/raid1/www/Hosts/bankrupt/TCRAP_Public/130529.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
Wednesday, May 29, 2013, Vol. 16, No. 105
Headlines
A U S T R A L I A
LM INVESTMENT: Judge Junks FTI Consulting Bid to Oust Trustees
M WEBB BROS: In Voluntary Administration, Owes $1.25 Million
MIDWEST VANADIUM: S&P Affirms CCC Corp. Credit & Sr Issue Ratings
MORNINGTON WINERY: Ferrier Hodgson Appointed as Administrators
OTOWERTH CONSTRUCTIONS: Involved in AUD1.3MM Fraud
PHARMAXIS LTD: To Cut 30% Workforce after Bronchitol Setbacks
SERIES 2013-1: Fitch Puts 'BB' Rating on AUD25.2MM Class E Notes
SWAN SERVICES: Low-Paid Foreign Workers To Miss Payouts
TRIMS: Nine Investors Keen on Buying or Investing
* Moody's Sees Hike in Australian Prime RMBS Arrears in Q1
C H I N A
CHINA NATURAL: Asks NY Judge to Dismiss Involuntary Ch. 11
ROAD KING: S&P Revises Outlook to Stable & Affirms 'BB-' CCR
SUNTECH POWER: Receives NYSE Notice Regarding 2012 Annual Report
I N D I A
CHARUTAR AROGYA: ICRA Reaffirms 'B+' Ratings on INR27.75cr Loans
COMMERCIAL AUTO: ICRA Assigns 'B+' Ratings to INR9.4cr Loans
GRAH AVAS: ICRA Reaffirms 'B+' Rating on INR10cr Term Loan
HIND AUTOCRANKS: ICRA Assigns 'D' Ratings to INR10cr Loans
IBD SPACE: ICRA Reaffirms 'B+' Rating on INR27.5cr Term Loan
JAI AMBEY: ICRA Reaffirms 'B+' Ratings on INR6cr Loans
JNJ MACHINES: ICRA Assigns 'B' Ratings to INR16.5cr Loans
MILAN ASSOCIATES: ICRA Rates INR4.0cr Cash Credit at 'B+'
RISHI FIBERS: ICRA Reaffirms 'B' Ratings on INR11cr Loans
SOLAR SEMICONDUCTOR: ICRA Reaffirms D Ratings on INR508.6cr Loans
TRACK INNOVATIONS: ICRA Assigns 'B' Ratings to INR21.75cr Loans
J A P A N
ELPIDA MEMORY: Wants Tokyo Court-Approved Plan Recognized by U.S.
JLOC XXXIII: Fitch Withdraws 'D' Ratings on Three CMBS Deals
N E W Z E A L A N D
ALLIED FARMERS: May Lift Loan Book Value by NZ$274,000
STRATEGIC FINANCE: In Talks With FMA to Settle Claims
P H I L I P P I N E S
ASSOCIATED BROADCASTING: TV5 Offers Early Retirement Package
S O U T H K O R E A
SK HYNIX: Fitch Affirms 'BB' Issuer Default Ratings
X X X X X X X X
* Upcoming Meetings, Conferences and Seminars
- - - - -
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A U S T R A L I A
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LM INVESTMENT: Judge Junks FTI Consulting Bid to Oust Trustees
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Jenny Rogers at goldcoast.com.au reports that Queensland's top
judge has criticised the administrators of embattled LM Investment
Management over their bid to oust the trustees of LM's property
fund.
goldcoast.com.au relates that Chief Justice Paul de Jersey
described the legal move by FTI Consulting as "an unhelpful
intrusion" done to "pursue their own agenda" and said its
application had not benefited the fund's members.
Justice de Jersey also ordered FTI Consulting to pay indemnity
costs after its application failed, the report notes.
According to the report, legal sources said the costs, combined
with FTI's own legal bill, could reach AUD500,000.
goldcoast.com.au says the finding is the latest in a string of
ongoing legal battles launched over control of funds that were
managed by high-profile Gold Coast-based LM Investment Management,
which was placed into voluntary administration on March 19.
FTI Consulting earlier this month launched a bid seeking to set
aside the appointment of KordaMentha and Calibre Capital as joint
trustees of LM's Managed Performance Fund (MPF), goldcoast.com.au
recalls.
According to goldcoast.com.au, the MPF controls the Maddison
estate at Pimpama, LM's highly touted flagship project claimed to
be worth AUD1 billion but which is now carrying debt of about
AUD270 million.
goldcoast.com.au says Justice de Jersey dismissed FTI Consulting's
application and in ordering the firm to pay costs, said "the
conclusion that (FTI) were pursuing their own agenda itself
justifies indemnity costs".
He also directed that FTI Consulting could not recover the costs
from the fund, the report relays.
New Zealand Herald reported that voluntary administrators have
been appointed to LM Investment Management, a beleaguered
Australian firm that controlled a frozen mortage fund which
New Zealanders had more than NZ$100 million tied up in. LM
directors on March 19, 2013, appointed John Park and Ginette
Muller of FTI Consulting as voluntary administrators, blaming the
move on liquidity problems caused by a smear campaign.
LM is the responsible entity of these registered managed
investment schemes:
-- LM Cash Performance Fund;
-- LM First Mortgage Income Fund;
-- LM Currency Protected Australian Income Fund;
-- LM Institutional Currency Protected Australian Income Fund;
-- LM Australian Income;
-- LM Australian Structured Products Fund; and
-- The Australian Retirement Living Fund.
LM also operates the unregistered LM Managed Performance Fund.
The Supreme Court of Queensland in April appointed KordaMentha and
its affiliate firm Calibre Capital as joint trustees of the AUD350
million Gold Coast-based LM Managed Performance Fund (LMPF).
M WEBB BROS: In Voluntary Administration, Owes $1.25 Million
------------------------------------------------------------
ABC News reports that a stock and station agency in northern NSW
has gone into voluntary administration owing creditors $1.25
million.
M Webb Bros Pty Ltd, trading as Webb Bros Property and Livestock,
owes $750,000 to trade creditors and $500,000 to a secured
creditor, according to ABC News.
The report notes that administrator Scott Newton, from Shaw Gidley
Insolvency and Reconstruction, said it's the result of a cash flow
issue.
"It's had a reasonably poor year, this last financial year, partly
due to a downturn in sales from the livestock industry and a
couple of major bad debtors which lead to them having a cash flow
issue and not being able to fund creditor payments. . . . The
directors have an obligation to take steps in those circumstances,
and I think they took the appropriate steps by placing the company
into administration to give it some breathing space," the report
quoted Mr. Newton as saying.
The report discloses that the company leases the Taree Townhead
Selling Complex, in the Manning Valley, and the future of its
weekly cattle market is now uncertain.
"The way the sales occur, I wasn't in a position to cash flow the
purchase of the cattle to put through the sales process. . . .
"Upon my appointment I don't have a source of cash to cash flow
that; the way the livestock industry works I'm required to
guarantee the vendors their payment of their livestock whether or
not I've been paid from the sale of that livestock, and I'm just
not in the position to do that," the report quoted Mr. Newton as
saying.
The report discloses that Mr. Newton said that appointing another
operator to run or lease the saleyards in the interim could be an
option.
The report relays that Gloucester-based Gooch Agencies Real Estate
& Livestock is considering the option of leasing the saleyards.
And while the administrator of M Webb Pty Ltd says a few bad
debtors has contributed to the cash flow problem, the company has
320 creditors listed, the report notes.
Mr. Newton says the company also owes staff $170,000 to $180,000
in entitlements, the report adds.
MIDWEST VANADIUM: S&P Affirms CCC Corp. Credit & Sr Issue Ratings
-----------------------------------------------------------------
Standard & Poor's Ratings Services said that it had affirmed its
'CCC' corporate credit and senior issue ratings on Australian
mining company Midwest Vanadium Pty Ltd. (MVPL). The recovery
rating on the senior issue is '4'. At the same time, S&P removed
all ratings from CreditWatch, where they were placed with negative
implications on Feb. 21, 2013. The rating outlook is developing.
"We affirmed the ratings and removed them from CreditWatch
negative because MVPL had remedied the technical breach of its
indenture covenant and received external funding to improve its
previously weak liquidity," said Standard & Poor's credit analyst
May Zhong said.
MVPL has received consent from senior secured noteholders to waive
the minimum holding requirement in the interest reserve account
until Nov. 15, 2013. At the same time, its parent Atlantic Ltd.
has executed and fully drawn a new, senior unsecured, short-term
funding facility of about A$28.5 million from its largest
shareholder Droxford International Ltd. In addition, MVPL is
expected to a receive a research and development reimbursement
claim from the Australian Taxation Office (ATO) of about A$25
million in the next six months. These initiatives, in S&P's view,
provide timely relief to the company's liquidity pressure, and
should be sufficient to fund the ongoing ramp-up of the Windimurra
project until around third-quarter calendar 2013.
S&P believes a successful ramp-up of the project would sustainably
improve MVPL's liquidity position and enable the company to
fulfill its debt obligations in the next 12 months. S&P expects
the project to achieve about 70% production ramp-up by August 2013
and should begin to generate surplus cash from operations in the
third quarter of calendar year 2013.
Ms. Zhong added: "The developing outlook reflects the uncertainty
regarding MVPL's liquidity position in the next 12 months. It is
not certain whether MVPL will generate sufficient cash flows as
the recent modification works on the beneficiation circuit have
yet to prove that the circuit will perform as expected. External
funding will be required again if there is further delay in
ramping up the Windimurra plant."
S&P would consider a higher rating if the processing plant is
fully operating and the company's operating cash flow is neutral,
leading to a sustainable liquidity position.
The rating could be lowered if the company's liquidity
deteriorates from current levels such that its ability to pay the
next 12-month's interest payment is impaired. This scenario could
occur if there are further delays in project ramp-up and the
company fails to source external funding to alleviate liquidity
pressure.
MORNINGTON WINERY: Ferrier Hodgson Appointed as Administrators
--------------------------------------------------------------
Cara Waters at SmartCompany reports that Mornington Winery Group
has collapsed as the wine industry battles against a "double
whammy" of high exchange rates and a consolidated retail sector.
John Lindholm and Peter McCluskey of Ferrier Hodgson were
appointed as administrators to the boutique winery last week.
Expressions of interest were sought for the winery, cellar door
and restaurant with seating capacity for 110 people.
Mornington Winery Group includes key brands Dromana Estate,
Mornington Estate, 'i' Range and David Traeger and has leasehold
vineyards of 48.5 hectares with 19.2 hectares currently under
vine.
The winery has 500 tonne crushing capacity, 130,000 litres of
onsite storage and produces 10,000 cases per annum.
OTOWERTH CONSTRUCTIONS: Involved in AUD1.3MM Fraud
--------------------------------------------------
Bendigo Advertiser reports that Otowerth Constructions used false
documents to obtain AUD1.3 million of bank loans before going into
liquidation, a court has heard.
The report relates that Otowerth's accountant Barry Norman
Washington, 69, was on May 22, 2013, handed a suspended prison
sentence for his involvement in forging documents to apply for
loans between 2005 and 2009.
According to the report, the Bendigo Magistrates Court heard the
loans were illegally obtained to pay for housing developments that
were then sold for a profit.
Bendigo Advertiser notes that Otowerth folded in December 2011,
owing an estimated AUD4.6 million to creditors across central
Victoria.
The report says the court heard the company's director and sole
shareholder Ross Drechsler ordered Mr. Washington to apply for the
bank loans under false names.
Mr. Washington told police he was fearful that if he did not
comply with Mr. Drechsler's demands he would lose his job and
would not be able to gain employment elsewhere due to his age and
failing health, the report relays.
Magistrate Cottrill ordered him to serve a six-month prison
sentence, wholly suspended for 12 months, according to Bendigo
Advertiser.
The court heard Mr. Drechsler -- who now lives in Melbourne -- had
yet to be charged with any offences, the report adds.
Otowerth Constructions is a Bendigo-based building company.
PHARMAXIS LTD: To Cut 30% Workforce after Bronchitol Setbacks
-------------------------------------------------------------
Australian Associated Press reports that Pharmaxis will slash 45
jobs and cut costs as the company undertakes a major restructure
after encountering regulatory problems.
According to AAP, Pharmaxis chief executive Gary Phillips said all
areas of the business had been reviewed and the company would aim
to mitigate risks associated with drug development after failing
to achieve regulatory milestones.
"These decisions have been made in response to recent regulatory
and clinical trial setbacks," the news agency quotes Mr. Phillips
as saying.
Pharmaxis expects to reduce staff numbers by 30 per cent from 155
to 110 people, AAP relates.
The report says the company also expects to reduce costs by
AUD12 million per year, with around three quarters of the
reductions occurring by the end of the third quarter of the 2013
calendar year.
According to the report, Pharmaxis said it will seek "partnership
opportunities" for Bronchitol in the US for cystic fibrosis and
globally for bronchiectasis, while retaining a direct commercial
interest in Bronchitol in Europe and other approved and reimbursed
markets.
Bronchitol is an inhaled dry powder designed to hydrate the lung
and restore normal lung clearance mechanisms.
At the end of April Pharmaxis had AUD70.5 million in cash and a
further US$20 million available under a financing agreement upon
commencement of a US cystic fibrosis clinical trial, the report
discloses.
Based in Australia, Pharmaxis Ltd (ASX:PXS) --
http://www.pharmaxis.com.au/-- is a specialty pharmaceutical
company focused on the development of new products for the
diagnosis and treatment of chronic respiratory and immune
disorders. The Company is engaged in the development of products
for asthma, cystic fibrosis and chronic obstructive pulmonary
disease (COPD), including bronchiectasis and chronic bronchitis.
Pharmaxis reported three consecutive annual net losses of
AUD46.34 million, AUD45.75 million and AUD38.64 million for the
years ended June 30, 2010, 2011 and 2012.
SERIES 2013-1: Fitch Puts 'BB' Rating on AUD25.2MM Class E Notes
-----------------------------------------------------------------
Fitch Ratings has assigned Series 2013-1 REDS EHP Trust final
ratings. The transaction is an asset-backed securitisation of
automotive and equipment loan receivables. The ratings are as
follows:
AUD721.8m Class A notes: 'AAAsf'; Outlook Stable
AUD45m Class B notes: 'AAsf'; Outlook Stable
AUD34.2m Class C notes: 'Asf'; Outlook Stable
AUD23.4m Class D notes: 'BBBsf'; Outlook Stable
AUD25.2m Class E notes: 'BBsf'; Outlook Stable
AUD50.4m seller notes: not rated
The notes, due March 2019, were issued by Perpetual Trustee
Company Limited as trustee of Series 2013-1 REDS EHP Trust. The
Series 2013-1 REDS EHP Trust is a legally distinct trust
established pursuant to a master trust and security trust deed.
At the cut-off date, the total collateral pool consisted of 16,199
loan receivables totalling approximately AUD888.7m, with an
average size of AUD54,864. The pool comprises loan receivables
originated by BOQ Equipment Finance (BOQEF) whose ultimate parent
is Bank of Queensland (BBB+/Stable/F2). All loans are amortising
principal and interest loans for both cars and light commercial
vehicles (30.1%), trucks and buses (22.8%), trailers (13.4%),
excavators (11.2%) and other wheels (22.5%). The pool contains
loans with varying balloon amounts payable at maturity (48.8%),
with a weighted average balloon payment of 29.2%.
The transaction also benefits from a diversification of a large
number of small business borrowers across a broad range of
industries.
Key Rating Drivers
The 'AAAsf' Long-Term rating with Stable Outlook of the Class A
notes are based on the quality of the collateral; the 19.8% credit
enhancement provided by the subordinate class B, C, D, E and
seller notes; a liquidity reserve account of 1.25% of outstanding
notes, funded by issue proceeds; an interest rate swap provided by
Bank of Queensland, the standby interest rate swap provider,
Westpac Banking Corporation (AA-/Stable/F1+); and BOQEF's
underwriting and servicing capabilities.
The ratings on the class B, C, D and E notes are based on all the
strengths supporting the class A notes except their credit
enhancement levels.
Rating Sensitivities
Fitch's stress and rating sensitivity analysis is discussed in the
corresponding new issue report titled "Series 2013-1 REDS EHP
Trust", published today, now available at www.fitchratings.com or
by clicking on the above link. Included in a corresponding
appendix is a description of the representations, warranties and
enforcement mechanisms.
SWAN SERVICES: Low-Paid Foreign Workers To Miss Payouts
-------------------------------------------------------
The Sydney Morning Herald reports that thousands of low-paid
employees of collapsed cleaning company Swan Services will miss
out on unpaid entitlements because they are foreigners,
administrators said.
Swan Services collapsed last week and is likely to be liquidated.
It owes AUD1.6 million to its 2,466 employees for wages alone. Its
workers were said to earn AUD17 an hour cleaning shopping centres
and AUD21 an hour in office buildings.
SMH says many have found work with different contractors, but
Michael Crosby, president of the United Voice union, said they
were owed two weeks' pay, leave and leave loading, and
superannuation from March onwards.
Swan Services owes a further $2.7 million to creditors such as
cleaning product suppliers. The bill for government creditors,
primarily the Tax Office, is yet to be determined, SMH relays.
According to SMH, administrator Anthony Elkerton, from Pitcher
Partners, said the employee entitlements comprised an "unusually
high percentage" of Swan's debt, reflecting the labour intensity
of the cleaning industry.
SMH relates that Mr. Elkerton estimated that only 30-35 per cent
of Swan's workers would be eligible for the Fair Entitlements
Guarantee, a taxpayer-funded scheme that covers unpaid wages,
annual leave and redundancy entitlements of workers whose employer
has gone bankrupt or into liquidation until money can be retrieved
by insolvency.
Only Australian citizens or holders of a permanent visa or a
special category visa are eligible for the scheme.
Mr Elkerton said it was "too early to predict a return to
creditors."
Mr Elkerton said the payment of any employee entitlements would
"rely heavily on debtor collection rather than asset sales."
Swan Services Pty Ltd was run by founder and owner Robert Swan
for a period of 43 years. Swan Services Pty Ltd and its
subsidiaries employed 2,466 people across universities, shopping
centres and office blocks across Australia.
Anthony Wayne Elkerton and David Gregory Young of Pitcher
Partners were appointed joint voluntary administrators of the
following companies on May 22, 2013:
-- Swan Services Pty Limited
-- Cleaners QLD Pty Limited (formerly traded as Swan Services
(QLD) Pty Limited)
-- Cleaners SA Pty Limited (formerly traded as Swan Services
S.A. Pty Limited)
-- Cleaners ACT Pty Limited (formerly traded as Swan Services
(ACT) Pty Limited)
-- Superior Cleaners WA Pty Limited (formerly traded as Swan
Services (W.A.) Pty Limited)
-- Cleaners New South Wales Pty Limited
-- Cleaners VIC Pty Limited (formerly traded as Swan Services
Victoria Pty Limited)
The Sydney Morning Herald reported that Mr. Elkerton said the
company had been losing money on several contracts, was hit
by a major computer glitch earlier this year, and had suffered a
delay in receiving payments from customers.
Early estimates are that the company owes AUD2.8 million to
creditors and is owed AUD12.5 million, SMH disclosed.
TRIMS: Nine Investors Keen on Buying or Investing
-------------------------------------------------
AdelaideNow reports that the administrators of collapse clothing
retailer Trims said nine investors have expressed an interest in
buying or investing in the company.
AdelaideNow relates that Andre Strazdins of BRI Ferrier said the
investors were all interstate and ranged from parties interested
in buying the retailer to those wanting to invest in the business.
Trims went into voluntary administration on May 14, and about 25
staff were laid off on May 17 after it was decided the company
could not reopen.
Administrators held the company's first creditors meeting on
May 24, which was attended by 20 suppliers and employees.
According to the report, Mr. Strazdins said the amount of money
owed to the company's unsecured creditors has grown by AUD200,000
to AUD2.3 million, and Trims has insufficient assets to pay all
those owed.
He said a further amount of about AUD560,000 is owed in
entitlement and redundancy payments to Trims employees, but
Mr. Strazdins was unable to confirm whether they would ultimately
receive their money, AdelaideNow relays.
Trims is a family-owned clothing store.
* Moody's Sees Hike in Australian Prime RMBS Arrears in Q1
----------------------------------------------------------
Moody's Investors Service says that the prime 30-days plus arrears
rate for Australian RMBS rose during Q1 2013 to 1.66% in March
from 1.44% in December and 1.59% in March 2012.
The increase was consistent across all issuer groups.
Specifically, the arrears rate for the major banks rose to 1.39%
in March from 1.16% in December, while for the regional banks, it
rose to 1.87% from 1.65%, and for non-authorized deposit-taking
institutions (ADIs), it rose to 3.46% from 3.24%.
Moody's further notes that the 30-days plus arrears rate for RMBS
deals with 100% low-doc loans has experienced continued increases
over recent years, peaking at a record high of 6.24% in January,
before ending Q1 2013 at 5.83% in March, up from 5.78% in December
2012.
Borrowers in low-doc deals provide little or, in the case of no-
doc loans, no proof of income. Moody's considers that the higher
delinquency rate of these loans can be explained by the cash flow
volatility of the borrowers, who are typically self-employed.
After excluding 100% low-doc deals, the prime 30-days plus arrears
rate would have been much lower at 1.60% in March.
Overall losses for Australian prime RMBS are still very low by
international standards with the worst performing 2004 vintage
incurring 36 basis points of losses to date. To date, lenders
mortgage insurance has covered the majority of these losses, with
any residual covered by excess spread or by the lender.
The non-conforming 30-days plus arrears rate rose to 7.85% in
March from 7.39% in December, and was 85 basis points lower than
March 2012 when it was 8.70%.
National unemployment remained relatively constant at 5.59% in
March, but variations across states were significant. For example,
the lowest unemployment rate of 4.75% was observed in Western
Australia, and highest of 7.33% in Tasmania.
Home prices in the major cities ended Q1 2013 with year-on-year
growth. Perth saw the strongest increase of 5.78% while Adelaide
witnessed the weakest of 0.28%. Overall, prices across Australia
rose 2.42%.
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C H I N A
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CHINA NATURAL: Asks NY Judge to Dismiss Involuntary Ch. 11
----------------------------------------------------------
Maria Chutchian of BankruptcyLaw360 reported that China Natural
Gas Inc. urged a New York bankruptcy judge to throw out the
involuntary Chapter 11 proceedings commenced by a hedge fund owned
by one of its directors, saying the filing was part of the
directors' effort to gain control of the company.
According to the report, the natural-gas pipeline operator, known
as CHNG, claims Xiang Dong Yang, who owns Abax Lotus Ltd. and Abax
Nai Xin A Ltd., had expressed interest in taking the publicly
traded company private before the two Abax entities.
Headquartered in Xi'an, Shaanxi Province, P.R.C., China Natural
Gas, Inc., was incorporated in the State of Delaware on March 31,
1999. The Company through its wholly owned subsidiaries and
variable interest entity, Xi';an Xilan Natural Gas Co., Ltd., and
subsidiaries of its VIE, which are located in Hong Kong, Shaanxi
Province, Henan Province and Hubei Province in the People's
Republic of China ("PRC"), engages in sales and distribution of
natural gas and gasoline to commercial, industrial and residential
customers through fueling stations and pipelines, construction of
pipeline networks, installation of natural gas fittings and parts
for end-users, and conversions of gasoline-fueled vehicles to
hybrid (natural gas/gasoline) powered vehicles at 0ptmobile
conversion sites.
On Feb. 8, 2013, an involuntary petition for bankruptcy was filed
against the Company by three of the Company's creditors, Abax
Lotus Ltd., Abax Nai Xin A Ltd., and Lake Street Fund LP (Bankr.
S.D.N.Y. Case No. 13-10419). The Petitioners claimed that they
have debts totaling $42,218,956.88 as a result of the Company's
failure to make payments on the 5% Guaranteed Senior Notes issued
in 2008. The Company says it intends to oppose the motion.
Adam P. Strochak, Esq., at Weil, Gotshal & Manges, LLP, in
Washington, D.C., represents the Petitioners as counsel.
ROAD KING: S&P Revises Outlook to Stable & Affirms 'BB-' CCR
------------------------------------------------------------
Standard & Poor's Ratings Services said that it had revised the
rating outlook on China-based toll-road and property company Road
King Infrastructure Ltd. (RKI) to stable from negative. In line
with the outlook revision, S&P raised its long-term Greater China
regional scale rating on RKI and the company's outstanding senior
unsecured notes to 'cnBB+' from 'cnBB'. At the same time, S&P
affirmed its 'BB-' long-term corporate credit rating on RKI and
the 'BB-' issue rating on the notes.
"We revised the outlook to reflect our expectation that RKI can
sustain the improvement in its financial performance over the next
12 months because of moderately increasing property sales and
stabilizing profit margin," said Standard & Poor's credit analyst
Joe Poon. "Our view is based on lower volatility in China's real
estate market and RKI's focus on mass market products, which are
less sensitive to policy tightening. In addition, the company has
improved project execution."
S&P assess RKI's business risk profile as "weak" and financial
risk profile as "aggressive."
S&P expects RKI's contract sales to improve to about Chinese
renminbi (RMB) 10.0 billion-RMB11.0 billion in 2013. The
company's sales execution has improved, leading contract sales to
grow 69% year on year in 2012. RKI's contract sales of
RMB9.56 billion in 2012 exceeded S&P's expectation of about
RMB8.5 billion. The company's contract sales were RMB3.0 billion
for the quarter ended March 2013.
RKI's profit margin is likely to remain stable in 2013 after
improving in 2012, in S&P's opinion. Selling prices should
increase modestly because of a stabilizing market. However,
construction costs are likely to rise slightly as well.
S&P expects RKI to meaningfully increase land acquisition activity
this year to replenish its land bank because of better sales and a
slower pace of land acquisitions in the past two years. S&P
believes RKI will likely maintain some discipline toward land
acquisitions.
"The stable operating performance of RKI's toll-road business
continues to provide stable cash flows, which underpin the
affirmed rating," said Mr. Poon. In 2012, RKI's four expressway
projects represented about 87% of the company's toll road
business. RKI will likely continue to seek out new investment
opportunities in expressways to maintain its solid toll road
portfolio.
S&P expects RKI's capital structure and cash flow coverage to
improve modestly in 2013. This is because better cash flow from
property sales may outpace the increase in spending on land
purchases and construction.
The stable outlook reflects S&P's expectation that RKI will likely
moderately grow its property sales and maintain stable profit
margin in the next 12 months. S&P also expects the cash flows
from the toll road business to be stable and solid.
S&P may lower the rating if: (1) RKI's EBIT interest coverage is
lower than 2x for a sustained period; or (2) the company's growth
and debt-funded expansion are more aggressive than S&P expected.
S&P could raise the rating if RKI further improves the execution
of its property sales, maintains profit margin more in line with
rated developer peers', and remains disciplined toward debt-funded
expansion. An upgrade trigger could be EBIT interest coverage of
more than 3x over a sustained period.
SUNTECH POWER: Receives NYSE Notice Regarding 2012 Annual Report
----------------------------------------------------------------
Suntech Power Holdings Co., Ltd., has received a notification from
the New York Stock Exchange that it has failed to timely file its
Form 20-F for the fiscal year ended Dec. 31, 2012. The Company
had previously announced on May 1, 2013, that it required
additional time to complete its 2012 Annual Report and will delay
the filing beyond the deadline of April 30, 2013. The Company is
working diligently to complete these assessments and file restated
financials for 2010 and 2011, as well as the 2012 Annual Report,
as soon as practicable.
The NYSE has indicated that it will closely monitor the status of
the Company's late filing and related public disclosures for up to
a six-month period from its due date. If the Company fails to
file its annual report within six months from the filing due
date, the NYSE may allow the Company's securities to trade for up
to an additional six months.
About Suntech
Wuxi, China-based Suntech Power Holdings Co., Ltd. (NYSE: STP)
produces solar products for residential, commercial, industrial,
and utility applications. With regional headquarters in China,
Switzerland, and the United States, and gigawatt-scale
manufacturing worldwide, Suntech has delivered more than
25,000,000 photovoltaic panels to over a thousand customers in
more than 80 countries.
As reported by the TCR on March 20, 2013, Suntech Power Holdings
Co., Ltd., has received from the trustee of its 3% Convertible
Notes a notice of default and acceleration relating to Suntech's
non-payment of the principal amount of US$541 million that was due
to holders of the Notes on March 15, 2013. That event of default
has also triggered cross-defaults under Suntech's other
outstanding debt, including its loans from International Finance
Corporation and Chinese domestic lenders.
=========
I N D I A
=========
CHARUTAR AROGYA: ICRA Reaffirms 'B+' Ratings on INR27.75cr Loans
----------------------------------------------------------------
The rating of '[ICRA]B+' has been reaffirmed for term loan of
INR12.75 crore term loan limits and INR15.00 crore long-term fund-
based limits of Charutar Arogya Mandal.
Amount
Facilities (INR Cr) Ratings
---------- -------- -------
Long-term Term Loan 12.75 [ICRA]B+ reaffirmed
Long-term Fund-based 15.00 [ICRA]B+ reaffirmed
limits
The rating reaffirmation continues to reflect the weak financial
profile of the Trust, which is characterized by operating losses
and negative cash accruals. The operational metrics of the
healthcare business remain weak, given the low bed occupancy rates
and the partly subsidised nature of medical treatment. Further,
there exists limited flexibility in the medical education business
since fee-fixation is through a Government-constituted fee
committee, and the Trust remains susceptible to competition from
both Government and private educational institutions. Retention of
medical consultants and faculty alike remains a key challenge for
the Trust. Further, ICRA notes that the quantum of donations to
CAM has reduced over the last two years, and the ability of CAM to
make the hospital operations self-sustainable remains to be seen.
However, the rating reflects favorably the established reputation
and track record of the trust in the fields of healthcare and
medical education and the capital structure which is characterized
by satisfactory gearing levels due to the high funds corpus. The
rating also reflects the favorable prospects for the Oncology and
Cardiology healthcare segments; and the healthy intake levels for
the educational courses offered supported by the favorable
domestic prospects for higher education.
Charutar Arogya Mandal The Charutar Arogya Mandal, a charitable
trust, was set up in 1972 by late Dr. H M Patel, the then Union
Home and Finance Minister, to cater to the health care needs of
the rural community of Anand and Kheda districts of Gujarat.
Located at Karamsad in Gujarat, the Mandal presently runs a 571-
bed multi-speciality hospital, the Shree Krishna Hospital, besides
managing several institutions in the field of medical education
including the Pramukhswami Medical College.
CAM is registered as a Public Trust under Bombay Public Trust Act,
1850 and Society Registration Act 1860. Its properties are vested
in the Board of Trustees and the policies are decided by the
Governing Body headed by the Mandal's Chairperson, Dr. Amrita
Patel.
CAM has reported operating income (OI) of INR66.49 crore and net
loss (deficit) of INR14.84 crore for FY2012. In FY2013
(provisional estimates), CAM has reported OI of INR77.77 crore and
net loss of INR11.70 crore.
COMMERCIAL AUTO: ICRA Assigns 'B+' Ratings to INR9.4cr Loans
------------------------------------------------------------
ICRA has assigned '[ICRA]B+' and '[ICRA]A4' rating to the INR10.0
crore, bank facilities of Commercial Auto Products Private
Limited.
Amount
Facilities (INR Cr) Ratings
---------- -------- -------
Cash Credit 6.50 [ICRA]B+ Assigned
Term Loan 2.65 [ICRA]B+ Assigned
Bank Guarantee 0.10 [ICRA]A4 Assigned
Letter of Credit 0.50 [ICRA]A4 Assigned
Unallocated 0.25 [ICRA]B+ Assigned
The assigned rating takes into account CAPPL's long standing
experience of the promoters in the radiators manufacturing, and
healthy relations with tractor manufacturers as evident from
growing business volumes. The rating is, however, constrained by
moderate scale of operations, weak financial profile and stretched
cash flow position of the company. Going forward, CAPPL's ability
to increase its scale of operations as well as improve its
profitability, improve its financial risk profile and manage its
working capital intensity would remain key rating sensitivities.
CAPPL was incorporated in 1985 by Mr. Ajay Gupta to manufacture
and export radiators for the automotive industry. Initially, the
company was engaged in manufacturing copper brass radiator
followed by aluminum radiators manufacturing unit being set up in
2008. The company has moderate scale of operations and as per
management, it has 50% market share in both copper-brass radiators
and aluminum radiators in north India. CAPPL supplies to major
tractor manufacturers like Mahindra and Mahindra Limited (M&M),
Escorts Limited, International Tractors Limited (ITL) etc. CAPPL
is also looking for expansion in product lines by introducing new
products Inter Coolers and Charge Air Coolers, expected to reach
market in FY15. The promoters also have another company - Motor
Sales Ltd engaged in the business of leasing of commercial real
estate, cinema exhibition and dealership of TML in Lucknow.
Recent Results
As per provisional 2012-13 financials, CAPPL reported an Operating
Income (OI) of around INR38.0 crore, Operating Profits before
Depreciation, Interest and Tax (OPBDIT) of INR3.8 Crore, and
Profit After Tax (PAT) of INR0.6 Crore.
GRAH AVAS: ICRA Reaffirms 'B+' Rating on INR10cr Term Loan
----------------------------------------------------------
ICRA has reaffirmed the long term rating of '[ICRA]B+' for
INR10 crore working capital term loan of Grah Avas Vikas Private
Limited. Further, ICRA has assigned short-term rating of
'[ICRA]A4' rating for INR0.23 crore non-fund-based limits of
GAVPL.
Amount
Facilities (INR Cr) Ratings
---------- -------- -------
Working Capital 10.00 [ICRA] B+ (Reaffirmed)
Term Loan
Non-fund-based 0.23 [ICRA] A4 (Assigned)
Limits
The ratings reaffirmation draw comfort from long track record of
GAVPL's promoters in real estate business, healthy booking in its
on-going project, and healthy progress in execution. The ratings,
however, continue to be constrained by the moderate size of the
company's operations, significant supply in the vicinity and
continuing modest collection efficiency (-75% in FY13). The
ratings also take into account the company's exposure to execution
risk, as the project is in construction phase and is significantly
larger than the ones executed the company in the past. Further,
the ratings factor in exposure to funding risks as large part of
the project cost is expected to be met through customer advances
which are contingent on its ability to sell the space as well as
maintain healthy collection efficiency.
Grah Avas Vikas Pvt Ltd, incorporated in July 1998, is involved in
real estate and construction activities in the states of
Uttarakhand and Uttar Pradesh. The company has, in the past,
developed projects in the cities of Ghaziabad (Uttar Pradesh),
Dehradun (Uttarakhand) and Mussoorie (Uttarakhand). The promoters
have developed properties in residential, commercial, retail and
hospitality segments of real estate. The Group has constructed
around 40 residential and commercial buildings in residential
colonies in Ghaziabad- Vaishali & Kaushambhi, consisting of more
than 500 residential units, three group housing complexes in
Dehradun consisting of around 200 flats and one hotel in
Mussoorie, consisting of 24 rooms.
Recent Results
In FY2012, Grah Avas Vikas Private Limited (GAVPL) reported
operating income of INR12.39 crore (previous year INR10.37 crore)
and net profit of INR0.53 crore (previous year INR0.46 crore).
HIND AUTOCRANKS: ICRA Assigns 'D' Ratings to INR10cr Loans
----------------------------------------------------------
ICRA has assigned '[ICRA]D' rating to the INR5.3 crore term loans,
INR4.0 crore long-term fund based facilities and
INR0.7 crore proposed facilities of Hind Autocranks Private
Limited.
Amount
Facilities (INR Cr) Ratings
---------- -------- -------
Term Loans 5.3 [ICRA]D assigned
Long-Term Fund 4.0 [ICRA]D assigned
Based Limits
Long-Term Fund 0.7 [ICRA]D assigned
Based Limits
(proposed)
The assigned rating reflects recent delays in debt servicing by
the company with stretched liquidity position owing to significant
debt-funded capital expenditure in the recent past and weak
operating performance during 2012-13. The company has incurred a
significant capital expenditure of ~Rs. 9.0 crore over the last
three years (2010-11 to 2012-13) towards capacity expansion with
the same funded primarily through external borrowings. In
addition, owing to slowdown in automotive demand, the company's
operating performance during 2012-13 has also been weak as
reflected in de-growth in revenues and decline in profitability.
The ratings also factor in the company's small scale of operations
restricting its operational and pricing flexibility; low value
addition with largely job-work nature of operations (although the
same has gradually been evolving in favor of direct sales); high
competitive intensity from other organised and unorganised players
and stretched financial profile as reflected in high gearing and
inadequate coverage indicators. Nevertheless, the ratings derive
positively factor in the company's established relationship with
OEMs like M&M and TML and limited exposure to raw material price
fluctuations with job-work nature of operations.
Established in 1996, Hind Autocranks Private Limited is primarily
engaged in manufacturing of semifinished and finished crankshafts
catering to Mahindra and Mahindra Limited and Tata Motors Limited.
The company manufactures crankshafts for engines ranging from 2-
cylinders to 6-cylinders. The company is a part of the Hind Group
which also comprises of one more partnership firm
named Hind Engineering engaged in job-work for HAPL. The Group was
promoted by Mr. Maruti Lal Kakatkar in 1964 starting with an
electrical shop under Hind Engineering. Over the years, the Group
has entrenched itself as an automotive components manufacturer.
The current operations of the company are looked after by Mr.
Ulhaas Kakatkar, son of Mr. Maruti Lal Kakatkar. The Group
presently has 5 manufacturing lines (3 under HAPL and 2 under Hind
Engineering). The combined manufacturing capacity of the Group
stands at 1,000 crankshafts per day (i.e. around 200 crankshafts
per line).
Recent Results
For 2011-12, the company's operating income stood at INR18.1 crore
with a Profit After Tax (PAT) of INR0.8 crore as against an
operating income of INR15.8 crore and PAT of INR0.7 crore for
2010-11.
IBD SPACE: ICRA Reaffirms 'B+' Rating on INR27.5cr Term Loan
------------------------------------------------------------
ICRA has reaffirmed the long term rating assigned to INR27.50
crore fund-based limits of IBD Space Infrastructure Private
Limited at [ICRA]B+.
Amount
Facilities (INR Cr) Ratings
---------- -------- -------
Fund Based Limits 27.50 [ICRA]B+ re-affirmed
Term Loan
The rating reaffirmation takes into account the long experience of
IBD's promoters in the field of real estate development and
favourable location of the project in Indore city with ease of
accessibility. The rating also draws comfort from timely infusion
of required equity contribution, improvement in collection
efficiency and completion of the construction work for Phase-I of
the project.
The rating is however constrained by the high market risk posed by
significant unsold area (45% of the area remains unsold as on
Mar'13). The market risk gets elevated further with the presence
of many completed and on-going projects in the close vicinity. Any
delays in receiving additional bookings and realization of
commensurate customer advances may constrain the cash flows,
impacting IBD's ability to meet quarterly debt repayments which
are scheduled to commence from Q2FY14 onwards.
Going forward, ability of the company to achieve high bookings and
collect advances in a timely manner in order to meet its debt
repayment obligations would constitute key rating sensitivities.
Incorporated in June 2008, IBD Space Infrastructure Private
Limited is engaged in development and construction of apartments,
houses, flats, rooms, bungalows, markets, shopping complexes,
townships or other building or accommodations. The company is
developing its first project 'Belmont Park' (residential
apartments) in Village Kelod Hala, Near IDA Scheme No.78 Part II,
A.B. Road, Indore (Madhya Pradesh). This first phase of the
project is being developed on the land area of 219,871 sq. ft.
with saleable area of 524,256 sq. ft. for an estimated cost of
INR67.50 crore (revised from INR60.0 crore projected earlier). As
on Mar 2013, company has incurred ~90% of the revised project cost
while bookings have been received for 55% of the saleable area.
The project is being developed by IBD Space Infrastructure Pvt.
Ltd. on Joint Development Agreement (JDA) basis with two JDA
Partners: Space Infra and Real Estate Pvt. Ltd. & Nipun Real mart
Pvt. Ltd. These two partners will get 15% of the sales proceeds
from the project as cost of land.
Recent Results
IBD reported net profit of INR0.18 crore on an operating income of
INR3.47 crore in FY12.
JAI AMBEY: ICRA Reaffirms 'B+' Ratings on INR6cr Loans
------------------------------------------------------
ICRA has reaffirmed '[ICRA]B+' rating for the INR6.0 Crore bank
facilities of Jai Ambey Castings Private Limited.
Amount
Facilities (INR Cr) Ratings
---------- -------- -------
Working Capital 1.0 [ICRA]B+ reaffirmed
Facilities
Term Loans 4.5 [ICRA]B+ reaffirmed
Unallocated 0.5 [ICRA]B+ reaffirmed
The rating reaffirmation takes into account the healthy growth in
revenues recorded by JACPL post the commercialization of
operations in January 2012. The ratings, however, remain
constrained by the company's limited track record of operations
and its weak financial risk profile, characterized by high gearing
and weak debt coverage indicators. The company's profitability as
well as cash flows remain exposed to the cyclicality associated
with the steel industry. Going forward, JACPL's ability to manage
its working capital intensity, while increasing its scale of
operations, would remain the key rating sensitivity.
Incorporated in 2011, Jai Ambey Castings Private Ltd is engaged in
the manufacturing of mild steel (MS) Ingots, which are
subsequently rolled into long steel products like thermo
mechanically treated (TMT) bars, channels, angles etc. The plant,
located in Bhiwadi, commenced its commercial operations in Jan
2012 and has an installed capacity of 24,000 MT per annum. The
company is a family run business has been promoted by Mr. Rati Ram
and his three sons, M. Satish Kumar, Mr. Kapil Kumar and Mr.
Mukesh Kumar.
JNJ MACHINES: ICRA Assigns 'B' Ratings to INR16.5cr Loans
---------------------------------------------------------
A rating of '[ICRA]B' has been assigned to the INR15.50 crore term
loans and INR1.00 crore cash credit facilities of JNJ Machines
Private Limited.
Amount
Facilities (INR Cr) Ratings
---------- -------- -------
Term Loans 15.50 [ICRA]B assigned
Cash Credit 1.00 [ICRA]B assigned
Rating Rationale
The assigned rating is constrained by JNJ's limited track record
and small size of operations; limited experience of promoters in
machining and fabrication industry and weak financial profile
characterized by low profitability, weak coverage indicators and
high working capital intensity. The rating is further constrained
on account of JNJ's small clientele base with weak current order
book position; and exposure of the company's order inflows and
hence utilization levels to capital expenditure plans of end user
industries/clients, though it is trying to mitigate the risk by
establishing diversified customer base across various industries.
The rating, however, favorably factors in the location advantage
derived from the location of the company in Hazira - one of the
prominent industrial belts of the country with several large heavy
engineering companies which provides good potential clientele base
for JNJ and favourable demand prospects from the end-user
infrastructure sector segments such as heavy engineering, oil and
gas, power etc. in the long term.
JNJ Machines Private Limited was incorporated on July 26, 2010 and
is engaged in precision machining and fabrication (on job work
basis) of various components used in power and other heavy
engineering sectors like steel, oil, gas etc. JNJ's machining and
fabrication facility is located at Hazira, near Surat in the state
of Gujarat.
Recent Results
For the year ended on March 31, 2012, the company has reported an
operating income of INR0.53 crore and a net loss of INR0.01 crore
as against an operating income of INR0.06 crore and a loss of
INR0.04 crore for FY 2011. For the 10 months ended January 31,
2013, the company reported an operating income of INR3.32 crore
and profit before depreciation and tax of INR0.09 crore. (as per
provisional unaudited financials)
MILAN ASSOCIATES: ICRA Rates INR4.0cr Cash Credit at 'B+'
---------------------------------------------------------
The rating of '[ICRA]B+' has been assigned to the INR4.00 crore
fund based facilities of Milan Associates. ICRA has also assigned
an '[ICRA]A4' rating to the INR16.00 crore non-fund based
facilities of MA.
Amount
Facilities (INR Cr) Ratings
---------- -------- -------
Cash Credit 4.00 [ICRA]B+ assigned
Bank Guarantee 16.00 [ICRA]A4 assigned
The assigned ratings are constrained by the relatively modest
scale of operations of the firm and modest financial risk profile
as indicated by modest margins and high gearing levels. The
ratings also factor in high geographical concentration risk with
most of the ongoing and future projects being located in Gujarat;
sectoral concentration risk arising from focus on road
construction projects and the high competitive intensity in the
civil construction space resulting in a pressure on margins. In
ICRA's view, timely completion and delivery as per contract terms
remains critical for the firm to avoid LD claims and invocation of
bank guarantees which are substantial in relation to current net
worth of the firm. ICRA also notes the constitution of the firm as
a partnership concern leads to inherent risks with respect to
capital withdrawals which can have adverse bearing on the capital
structure.
The ratings, however, favourably factor in the long experience of
the promoter in the civil construction industry; the entity's
status as an "AA" class and "Special Category - I- contractor with
government of Gujarat; its reputed clientele comprising of
government and semi government bodies leading to limited counter-
party risk; moderate order book position (~2.58 times FY12
operating income) and positive outlook on infrastructure sector
over the medium to long term.
Milan Associates was promoted by Mr. Raken Dhirajlal Shah in the
year 1994 and was subsequently sold as a going concern to Mr.
Alpesh Patel (present partner) in the year 2007. MA is engaged in
road construction and canal/irrigation work for government
departments and semi government bodies of Gujarat. The firm
currently has three hot mix plants situated in and around Nadiad
(Gujarat). MA is a registered "AA" contractor and an approved
contractor in "Special Category I Contractor" class with the
Government of Gujarat.
Recent Results
For the year FY2011-12, the entity reported an operating income of
INR23.92 crore (against INR31.94 crore in FY 2010-11) and profit
after tax of INR0.74 crore (against INR0.82 crore in FY 2010-11).
Further, the firm has reported an operating income of INR43.37
crore and profit before depreciation and tax(PBDT) of INR1.43
crore for 9M FY13 (as provisional unaudited numbers).
RISHI FIBERS: ICRA Reaffirms 'B' Ratings on INR11cr Loans
---------------------------------------------------------
ICRA has reaffirmed the long-term rating of '[ICRA]B' to the
INR11.00 crore bank facilities of Rishi Fibers Private Limited.
Amount
Facilities (INR Cr) Ratings
---------- -------- -------
Long Term Fund Based
Limits-Cash Credit 10.00 [ICRA]B/Reaffirmed
Long Term Fund Based
Limits-Term Loan 0.82 [ICRA]B/Reaffirmed
Unallocated 0.18 [ICRA]B/Reaffirmed
The rating reaffirmation takes into satisfactory operational and
financial performance reported by RFPL as reflected by operating
income of INR38.06 crore in FY12, which was the inception year for
RFPL. The revenues have further improved to ~Rs 73 crore as per
the provisional results for FY13, which further reflects
positively on operational and financial performance of the company
given its initial years of operations. The rating is however
constrained by seasonality in revenues owing to RFPL's high
reliance on cotton ginning operations, which account for ~80%
revenues of the company. Further, low value additive nature of
operations and fragmented nature of industry has resulted in weak
operating profit margins of around 2-3%, which coupled with high
reliance on external funding support as evidenced by a high
gearing of 3.73x as on March 2012, has resulted in weak debt
coverage indicators as reflected by TD/OPBDITA of 12.21x, NCA/TD
of 3% and interest coverage of 1.75x for FY12.
ICRA also takes note of dynamic regulatory environment of the
cotton industry which lends an element of unpredictability to the
sector. Any regulatory changes affecting kapas prices have a
direct bearing on the ginning companies and consequently directly
affect the fortunes of the company. However, the rating is
supported by long standing experience of promoters in the cotton
industry and company's proximity to raw material sources by virtue
of its location in Sillod district, one of the biggest cotton
districts in Maharashtra. ICRA notes that proximity to raw
material source helps company to ensure steady supply and
marginally favorable prices. Further, the rating also favorably
factor in company's ready access to clientele of its other group
companies, which have also become RFPL's customers.
Going forward, RFPL's ability to grow its ginning operations,
improve its profitability and effectively manage its working
capital cycle, in addition to improving its capital structure,
will remain the key rating sensitivities.
Incorporated on April 19, 2011, Rishi Fiber Pvt Ltd acquired M/S
Radhika Ginning for an acquisition value of -INR2.6 crore funded
in debt equity ratio of ~0.62x. The company is primarily engaged
in the processing of raw cotton (Kapas), and manufacture of cotton
bales and cotton seeds. The company commenced operations in
November 2011 and has an installed capacity -300 bales/day. The
existing unit has 50 double rolling ginning machines and the plant
is located Sillod district, 60 Kms from Aurangabad.
Recent Results:
For the year ending March 2012, RFPL had net profit of INR0.24
crore on operating income of INR37.91 crore. According to
provisional results, the company has operating income of
INR73.28 crore for FY13.
SOLAR SEMICONDUCTOR: ICRA Reaffirms D Ratings on INR508.6cr Loans
-----------------------------------------------------------------
ICRA has reaffirmed the long-term and short-term rating of
'[ICRA]D' to the term loans, fund based facilities and non-fund
based facilities of Solar Semiconductor Private Limited
aggregating to INR508.68 crore.
Amount
Facilities (INR Cr) Ratings
---------- -------- -------
Term Loans 258.44 [ICRA]D reaffirmed
Fund Based Limits 173.09 [ICRA]D reaffirmed
Non-Fund Based Limits 77.15 [ICRA]D reaffirmed
The reaffirmation of rating takes into account the weak financial
profile of the company which is characterised by accumulating
losses, negative net worth position and tight liquidity. The
company's plant capacity utilisation continues to remain low,
affected by reduced off-take from one of the key customer in
recent fiscals. The company had already been referred to the
Corporate Debt Restructuring (CDR) Cell in June 2011 and as per
the terms of the CDR package, the loans were restructured and
repayment of the principal portion of the term loans was to
commence from June 2013 after a two-year moratorium, ICRA notes
that meeting the debt obligations in a timely manner would be
under pressure in the near term, given the inadequate cash flows
generated by the company's operations at present. The rating also
remains constrained by the high working capital intensity in the
business due to stretched receivables position as well as the
significant reduction in solar module prices due to overcapacity
across the solar module manufacturing value chain. ICRA however
favourably considers the technically competent management of the
company, the overall healthy demand outlook for the solar power
sector across the globe as well as in the domestic market
supported by various Government initiatives and the labour
advantages available from Indian operations.
Solar Semiconductor Private Limited specializes in Solar Photo
Voltaic technology products, services and solutions. The company
was established in 2006 and its holding company, Solar
Semiconductor Inc. has about 93% equity stake in the company. SSPL
leased facility in Gundlapochampally in Hyderabad for
manufacturing 75 MW Solar Module Line Facility which is a 100% EOU
registered with Vishkhapatnam Special Economic Zone. The company
commenced commercial operations in the second half of FY 2008 from
this facility. The company also has a 120 MW Solar Module Line
Facility (commissioned in February 2009) and 30 MW Cell Line
Facility (commissioned in June 2010) at FabCity in Hyderabad. The
company is also involved in system integration activities, i.e.
EPC contractor, for solar power plants and setup a 20 MW solar
plant in Gujarat in CY 2012. Due to the weak financial profile of
the company, it was referred by one of the lenders to the
Corporate Debt Restructuring (CDR) Cell and was admitted to the
same as on end of June 2011.
For FY 2012, the company reported net losses of INR127.57 crore on
an operating income of INR108.38 crore. For FY 2013, the company
has reported net losses of INR89.41 crore on an operating income
of INR114.03 crore (provisional).
TRACK INNOVATIONS: ICRA Assigns 'B' Ratings to INR21.75cr Loans
---------------------------------------------------------------
ICRA has assigned '[ICRA]B/[ICRA]A4' ratings for the INR27.0 Crore
bank facilities of Track Innovations India Private Limited.
Amount
Facilities (INR Cr) Ratings
---------- -------- -------
Working Capital 15.00 [ICRA]B assigned
Facilities
Term Loans 6.41 [ICRA]B assigned
Bank Guarantee 2.00 [ICRA]A4 assigned
Fund Based Facilities 3.25 [ICRA]A4 assigned
Unallocated 0.34 [ICRA]B assigned
The ratings assigned factor in the company's established
relationship with Northern Railways with supplies to the latter
being done since 1991. The ratings also take into account the
company's efforts to diversify its customer profile through an
increased focus on the private sector. The ratings are, however,
constrained by the company's weak financial risk profile, high
dependence on Northern Railways that results in lumpiness in
revenues as well the highly working capital intensive nature of
business. Additionally, the company's profitability remains
exposed to variations in raw material prices. Going forward, the
company's ability to scale up its operations as well as manage its
working capital intensity would remain key rating sensitivities.
Incorporated in 1989, Track Innovations (India) Private Limited is
engaged in the manufacturing and supplying of pre-stressed
concrete monoblock line sleepers and other special types of
sleepers to Indian Railways and other government and private
sector organizations. It has a plant located in Railway Colony,
Chandigarh. The company was initially promoted by Mr. Manish Verma
in 1989. It was then taken over by the current promoters, Mr. Amit
Padia and his family members in February 2009.
Recent Results
As per provisional financial statements, TIPL recorded an
operating income of INR28.9 Crore in 2012-13. The company reported
an operating profit before depreciation, interest and tax of
INR2.4 Crore and profit before tax (PBT) of INR0.4 Crore as per
provisional financials.
=========
J A P A N
=========
ELPIDA MEMORY: Wants Tokyo Court-Approved Plan Recognized by U.S.
-----------------------------------------------------------------
Yukio Sakamoto and Nobuaki Kobayashi, the Foreign Representatives
of Elpida Memory, Inc., a Japanese company that is the subject of
reorganization proceedings under Japanese law currently pending
before the Tokyo District Court, Eighth Civil Division, ask the
U.S. Bankruptcy Court for the District of Delaware to:
(i) recognize and enforce Elpida's reorganization plan
confirmed by the Tokyo Court in the Japan Proceeding and
recognizing the Tokyo Court's order confirming the
Reorganization Plan;
(ii) entrust the administration, realization and distribution of
Elpida's assets within the territorial jurisdiction of the
United States to the Foreign Representatives, including for
purposes of implementing the Cost Plus Model contemplated
by the Sponsor Agreement with Micron Technology, Inc.,
dated July 2, 2012 and incorporated into the
Reorganization Plan; and
(iii) restrain and enjoin all creditors of Elpida from commencing
or continuing any and all actions within the territorial
jurisdiction of the United States, insofar as those actions
are related to any claim or claims that will be
restructured or discharged under the Reorganization Plan.
The U.S. Court's protection, according to the Foreign
Representatives, is necessary to implement the orderly
reorganization of Elpida in accordance with the Reorganization
Plan, which was overwhelmingly approved by 99.54% of secured claim
voting rights and 67.90% of general unsecured claim voting rights
and was subsequently confirmed by the Tokyo Court and, upon
appeal, affirmed by the Tokyo High Court.
The Reorganization Plan, based on the Sponsor Agreement, is the
only means for Elpida's reorganization, the Foreign
Representatives tell the U.S. Court. For Elpida to fully realize
the benefits of the Reorganization Plan and Confirmation Order, it
is vital that the Reorganization Plan be recognized and enforced
against all of Elpida's reorganization creditors, the Foreign
Representatives assert.
The motion was filed by the Debtor's counsel, Mark D. Collins,
Esq., Paul N. Heath, Esq., Lee E. Kaufman, Esq., at Richards,
Layton & Finger, P.A.; and the Foreign Representatives' counsel,
Timothy Graulich, Esq., James I. McClammy, Esq., and Giorgio
Bovenzi, Esq., at Davis Polk & Wardwell LLP, New York, and
Theodore A. Paradise, Esq., at Davis Polk & Wardwell LLP, in
Tokyo.
A hearing on the motion will be held on June 27, 2013, at
10:00 a.m. (EDT). Objections are due June 7.
About Elpida Memory Inc.
Elpida Memory Inc. (TYO:6665) -- http://www.elpida.com/ja/-- is
a Japan-based company principally engaged in the development,
design, manufacture and sale of semiconductor products, with a
focus on dynamic random access memory (DRAM) silicon chips. The
main products are DDR3 SDRAM, DDR2 SDRAM, DDR SDRAM, SDRAM,
Mobile RAM and XDR DRAM, among others. The Company distributes
its products to both domestic and overseas markets, including the
United States, Europe, Singapore, Taiwan, Hong Kong and others.
The company has eight subsidiaries and two associated companies.
After semiconductor prices plunged, Japan's largest maker of DRAM
chips filed for bankruptcy in February with liabilities of 448
billion yen ($5.6 billion) after losing money for five quarters.
Elpida Memory and its subsidiary, Akita Elpida Memory, Inc.,
filed for corporate reorganization proceedings in Tokyo District
Court on Feb. 27, 2012. The Tokyo District Court immediately
rendered a temporary restraining order to restrain creditors from
demanding repayment of debt or exercising their rights with
respect to the company's assets absent prior court order.
Atsushi Toki, Attorney-at-Law, has been appointed by the Tokyo
Court as Supervisor and Examiner in the case.
Elpida Memory Inc. sought the U.S. bankruptcy court's recognition
of its reorganization proceedings currently pending in Tokyo
District Court, Eight Civil Division. Yuko Sakamoto, as foreign
representative, filed a Chapter 15 petition (Bankr. D. Del. Case
No. 12-10947) for Elpida on March 19, 2012.
Micron Technology, Inc. on Feb. 28 announced the Tokyo District
Court's issuance of an order approving Elpida Memory Inc.'s plan
of reorganization. Elpida's plan of reorganization calls for
Micron to sponsor Elpida's reorganization under which Elpida will
become a wholly owned subsidiary of Micron. The Tokyo District
Court's approval follows an Elpida creditor vote, concluded on
Feb. 26, in which the creditors voted to approve the
reorganization plan.
JLOC XXXIII: Fitch Withdraws 'D' Ratings on Three CMBS Deals
------------------------------------------------------------
Fitch Ratings has withdrawn the 'Dsf' rating on three Japanese
CMBS transactions as listed below. All of these transactions are
Japanese multi-borrower type CMBS securitisations.
JLOC XXXIII Trust
Class D TBIs 'Dsf'; rating withdrawn
JLOC 36, LLC
Class D notes 'Dsf'; rating withdrawn
JLOC 38, LLC
Class D notes 'Dsf'; rating withdrawn
Key Rating Drivers
The ratings are withdrawn as they are no longer considered by
Fitch to be relevant to the agency's coverage due to a lack of
investor interest. They were downgraded to 'Dsf' prior to this
rating withdrawal.
In each of the transactions, all other classes which ranked senior
to the defaulted classes have been fully redeemed.
Fitch will no longer provide ratings or analytical coverage for
these transactions.
====================
N E W Z E A L A N D
====================
ALLIED FARMERS: May Lift Loan Book Value by NZ$274,000
------------------------------------------------------
Paul McBeth at BusinessDesk reports that Allied Farmers, which
kept itself alive in March through a fire sale of toxic loans, may
lift the value of its loan book by NZ$274,000 as the Inland
Revenue Department threatens to wind up its rural operation to
recover unpaid tax.
BusinessDesk relates that the Hawera-based company's board, which
is finalising its 2013 accounts, "considers it appropriate to
advise that indicatively the net positive impact of the assessment
will be approximately NZ$276,000".
It made the statement one day after receiving a notice to
liquidate its Allied Farmers Rural subsidiary over an unpaid
NZ$4.2 million tax bill, BusinessDesk relays.
As at December 31, Allied Farmers' asset management unit, which
ring-fenced the toxic ex-Hanover loan book, had assets totalling
NZ$4.75 million and liabilities of NZ$1.29 million.
The group had net loans and advances worth NZ$1.02 million at the
end of the calendar year, with NZ$4.75 million past due and
impaired, the report discloses.
About Allied Farmers
Based in New Zealand, Allied Farmers Limited (NZE:ALF) --
http://www.alliedfarmers.co.nz/-- is engaged in livestock, real
estate, finance, wool brokering and manufacturing (meat and
timber). Rural Services comprise livestock, merchandise and real
estate operations. The Company's Rural Services activities are
carried out in Taranaki, Waikato, King Country and Manawatu. Its
Financial Services activities are carried out by Allied
Nationwide Finance Limited in Auckland, Wellington and
Christchurch. Timber processing comprises the Company's
discontinued sawmilling operations.
nzherald.co.nz said the future of Allied Farmers is in doubt after
its accounts revealed it needs to sell property, collect money
owed to it, and reach an agreement with its rural creditors in
order to survive as a going concern. The rural services business,
which acquired the assets of Hanover and United Finance in
December 2009, revealed its position in half-year accounts filed
to the NZX on March 26, 2012.
Allied Farmers Limited reported an unaudited loss of NZ$14.1
million for the year ended June 30, 2012, compared with NZ$40.9
million in 2011. A significant part of this loss, NZ$10.3
million (last year NZ$34.1 million), largely relates to the
further impairment of assets acquired from Hanover and United
Finance. Also included were NZ$0.7 million costs related to the
disposal of the rural merchandise business.
STRATEGIC FINANCE: In Talks With FMA to Settle Claims
-----------------------------------------------------
BusinessDesk reports that the Financial Markets Authority is in
talks with the board of failed lender Strategic Finance in a bid
to cut a deal, while the receiver for the financier has extended
its own settlement discussions.
The market watchdog, which in February said Strategic probably
breached securities law, is in "confidential settlement
discussions with the directors with respect to the FMA's claim", a
spokesman told BusinessDesk.
There is no indication yet as to when the discussions will be
completed, the report relays.
According to the report, the FMA gave the board the opportunity to
respond as it prepared to file civil proceedings against directors
including Kerry Finnigan, Graham Jackson, Marc Lindale, Timothy
Rich, Denis Thom and David Wolfenden.
It dropped its investigation into former director Jock Hobbs in
mid-2011 as the extent of his illness became apparent, the report
says.
BusinessDesk notes that the negotiations come as Strategic's
receiver, John Fisk of PwC, told investors in a May 9 update that
"substantial progress has been made" in their settlement talks
over potential breaches of the Companies Act and that it was
"worthwhile continuing with the settlement process whilst certain
matters are worked through".
That process has an agreed timetable and the receiver anticipates
making another announcement early next month, BusinessDesk
relates.
"The receivers acknowledge that investors are keen to see a
resolution in respect of any claims against directors and, at this
stage, we consider the settlement process provides the best
opportunity to maximise recoveries for investors," the update, as
cited by BusinessDesk, said.
About Strategic Finance
Headquartered in Wellington, New Zealand, Strategic Finance
Limited (NZE:SFLHA) -- http://www.strategicfinance.co.nz/--
operated as a specialist finance company offering financial
services, primarily to the property sector. The Company also
provided specialist financial and advisory services to the
property and corporate sectors. The Company operated in
New Zealand, Australia and Pacific Islands. The Company's
operating subsidiaries include Strategic Advisory Limited,
Strategic Nominees Limited, Strategic Mortgages Limited and
Strategic Nominees Australia Limited. The Company's non-
operating subsidiary is Strategic Properties No.1 Limited. In
May 2009, the Company incorporated a subsidiary, Gulf Property
Holdings Limited.
Strategic Finance Limited's parent company, Strategic Investment
Group, was wholly owned by Australian-based finance company Allco
HIT Limited.
The Troubled Company Reporter-Asia Pacific reported on March 15,
2010, that PricewaterhouseCoopers partners John Fisk and Colin
McCloy were appointed receivers of Strategic Finance Limited and
related companies Strategic Advisory Limited, Strategic Mortgages
Limited, Strategic Nominees Limited, and Strategic Nominees
Australia Limited. This ended the moratorium arrangement that
had been in place since December 2008. The companies' trustee,
Perpetual Trust, appointed receivers after SFL failed to generate
sufficient loan recoveries for its milestone repayment on Jan. 7,
2010. The company owed NZ$417 million to 13,000 investors.
Perpetual Trust Ltd., on July 27, 2010, appointed liquidators to
Strategic Finance. The High Court in Wellington made an order
that Corporate Finance's John Cregten and Andrew McKay be
appointed liquidators.
=====================
P H I L I P P I N E S
=====================
ASSOCIATED BROADCASTING: TV5 Offers Early Retirement Package
------------------------------------------------------------
Doris C. Dumlao at the Philippine Daily Inquirer reports that
TV5 network operator Associated Broadcasting Corp. has offered a
generous early retirement package to employees as the Manuel V.
Pangilinan (MVP)-led firm affirmed commitment to curb financial
hemorrhage and challenge a long-entrenched Philippine broadcasting
duopoly.
"TV5 management is offering its employees opting for early
retirement a two- month salary per year of service, among other
benefits, included in its special limited voluntary retirement
package," the network's corporate communications team said Monday
in a reply to a query from Inquirer.
"All organizations go through a cycle of growth and adjustments
and TV5 is similarly going through a transition phase," TV5 said
in its official reply.
The usual separation package in case of redundancy under the
country's Labor Code is only one month per year of service.
Doubling the incentive is seen as a way for TV5 to reduce overhead
cost by giving its staff an attractive early retirement option.
TV5 has a current headcount of 4,000 employees and talents.
TV5, a challenger in the industry dominated by ABS-CBN and GMA-7,
also refuted rumors that filing for bankruptcy was an option for
MVP.
MVP-led Philippine Long Distance Telephone Co. group ventured into
the broadcasting business in 2009 with a deal to take over a 75-
percent stake in ABC from a consortium led by businessman Antonio
"Tonyboy" Cojuangco. The acquisition was made through MediaQuest
Holdings Inc., a subsidiary of PLDT Beneficial Trust Fund, the
telecommunication giant's retirement fund.
====================
S O U T H K O R E A
====================
SK HYNIX: Fitch Affirms 'BB' Issuer Default Ratings
---------------------------------------------------
Fitch Ratings has revised Korea-based SK Hynix Inc.'s (Hynix)
Outlook to Positive from Stable. The agency has affirmed the
company's Long-Term Foreign- and Local-Currency Issuer Default
Ratings (IDRs), as well as its senior unsecured rating, at 'BB'.
Key Rating Drivers
Favorable operational outlook: The revision of the Outlook to
Positive from Stable reflects Fitch's view that Hynix will benefit
from the tighter supply-demand balance following the merger of
Elipda Memory Inc. and Micron Technology Inc., the world's third
and fourth largest dynamic random access memory (DRAM) makers
respectively.
In addition, the second-tier Taiwanese makers' gradual exit from
commodity DRAM is positive for Hynix, as pricing pressure should
reduce. However, Hynix's market position may be pressured if
Elpida-Mircon benefits from an increased scale after the merger.
Positive developments expected: We believe that Hynix will
continue to benefit from more stable chip prices in 2013 given a
tighter supply of commodity DRAM due to DRAM makers' gradual
capacity reductions. In addition, demand for mobile and server
DRAM remains solid. Fitch forecasts that Hynix's EBIT margin will
remain in line with its Q113 level of 11% in 2013. (2012: -2%)
Leverage to improve: Fitch forecasts Hynix's funds flow from
operations (FFO)-adjusted leverage will remain below 2x in the
short to medium term (2012: 2x) as improved profitability and
conservative capex will lead to positive free cash flow (FCF).
Cyclicality still key risk: While we believe improvements in the
supply-demand balance will reduce cash flow volatility, the memory
semiconductor industry will remain exposed to cyclicality which
will continue to be a key weakness in Hynix's credit profile. If
market dynamics do not improve as we expect or if the company's
market position weakens, the Outlook will be revised back to
Stable.
Support from SKT: Hynix's ratings are a notch above its standalone
level of 'BB-' to incorporate the implied support from SK Telecom
Co., Ltd. (SKT, A-/Stable) with its 21% ownership of Hynix. Fitch
believes that Hynix is an important asset for the SK Group.
Rating Sensitivities
Negative: Future developments that may, individually or
collectively, lead to negative rating action include -
- FFO-adjusted leverage sustains above 3x
- Negative FCF on a sustained basis
- An indication of weakening ties between SKT and Hynix
Positive: Future developments that may, individually or
collectively, lead to positive rating action include -
- FFO-adjusted leverage below 2x
- Positive FCF on a sustained basis
- EBIT margins above 6% on a sustained basis
- Indications of an eased volatility risk of the industry leading
to a more stable credit profile for Hynix over the medium to
long term
===============
X X X X X X X X
===============
* Upcoming Meetings, Conferences and Seminars
---------------------------------------------
June 13-16, 2013
AMERICAN BANKRUPTCY INSTITUTE
Central States Bankruptcy Workshop
Grand Traverse Resort, Traverse City, Mich.
Contact: 1-703-739-0800; http://www.abiworld.org/
July 11-13, 2013
AMERICAN BANKRUPTCY INSTITUTE
Northeast Bankruptcy Conference
Hyatt Regency Newport, Newport, R.I.
Contact: 1-703-739-0800; http://www.abiworld.org/
July 18-21, 2013
AMERICAN BANKRUPTCY INSTITUTE
Southeast Bankruptcy Workshop
The Ritz-Carlton Amelia Island, Amelia Island, Fla.
Contact: 1-703-739-0800; http://www.abiworld.org/
Aug. 8-10, 2013
AMERICAN BANKRUPTCY INSTITUTE
Mid-Atlantic Bankruptcy Workshop
Hotel Hershey, Hershey, Pa.
Contact: 1-703-739-0800; http://www.abiworld.org/
Aug. 22-24, 2013
AMERICAN BANKRUPTCY INSTITUTE
Southwest Bankruptcy Conference
Hyatt Regency Lake Tahoe, Incline Village, Nev.
Contact: 1-703-739-0800; http://www.abiworld.org/
Oct. 3-5, 2013
TURNAROUND MANAGEMENT ASSOCIATION
TMA Annual Convention
Marriott Wardman Park, Washington, D.C.
Contact: http://www.turnaround.org/
Nov. 1, 2013
AMERICAN BANKRUPTCY INSTITUTE
NCBJ/ABI Educational Program
Atlanta Marriott Marquis, Atlanta, Ga.
Contact: 1-703-739-0800; http://www.abiworld.org/
Dec. 2, 2013
BEARD GROUP, INC.
19th Annual Distressed Investing Conference
The Helmsley Park Lane Hotel, New York, N.Y.
Contact: 240-629-3300 or http://bankrupt.com/
Dec. 5-7, 2013
AMERICAN BANKRUPTCY INSTITUTE
Winter Leadership Conference
Terranea Resort, Rancho Palos Verdes, Calif.
Contact: 1-703-739-0800; http://www.abiworld.org/
*********
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., Washington, D.C., USA.
Valerie U. Pascual, Marites O. Claro, Joy A. Agravante, Rousel
Elaine T. Fernandez, Julie Anne L. Toledo, Frauline S. Abangan,
and Peter A. Chapman, Editors.
Copyright 2013. All rights reserved. ISSN: 1520-9482.
This material is copyrighted and any commercial use, resale or
publication in any form (including e-mail forwarding,
electronic re-mailing and photocopying) is strictly prohibited
without prior written permission of the publishers.
Information contained herein is obtained from sources believed
to be reliable, but is not guaranteed.
TCR-AP subscription rate is US$775 for 6 months delivered via e-
mail. Additional e-mail subscriptions for members of the same
firm for the term of the initial subscription or balance
thereof are US$25 each. For subscription information, contact
Peter Chapman at 215-945-7000 or Nina Novak at 202-241-8200.
*** End of Transmission ***