/raid1/www/Hosts/bankrupt/TCRAP

/raid1/www/Hosts/bankrupt/TCRAP_Public/130627.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, June 27, 2013, Vol. 16, No. 126 Headlines A U S T R A L I A DUNDEE'S HOTEL: In Liquidation; Workers' Future in Doubt INNOVATE SA: Clifton Hall Appointed as Liquidator WIRRINA COVE: Unable to Attract Bids at June 21 Auction WRIGHTS HOME: Appoints Clifton Hall as Liquidators C H I N A EXIM BANK: Moody's Revises Baseline Credit Assessment to ba3 ZUNGUI HAIXI: OSC Probes Ernst & Young Over Audit Failure * Chinese Issuers Continue to Replenish Land Banks Says Moody's I N D I A AA NUTTS: ICRA Assigns 'BB' Rating to INR0.80cr Loans AFEEF CASHEW: ICRA Reaffirms 'BB' Rating on INR3cr LT Loan AGARWAL FASTENERS: ICRA Assigns 'BB+' Ratings to INR18cr Loans ALLIED MEDICAL: ICRA Cuts Rating on INR13cr Loans to '[ICRA]BB+' ARADHNA FABRICS: ICRA Reaffirms 'BB-' Ratings on INR13.22cr Loans CARRYCON INDIA: ICRA Upgrades Ratings on INR10.3cr Loans to 'B+' CP SPONGE: ICRA Assigns 'B+' Ratings to INR23.12cr Loans DEEPAK STEEL: ICRA Cuts Rating on INR40cr Loan to 'BB+' EXCEL ANO: ICRA Rates INR3.35cr Loans at '[ICRA]B+' HARSHA STONE: ICRA Assigns 'B-' Rating to INR0.44cr Loan HMM INFRA: ICRA Assigns 'B' Rating to INR10cr Loan PHYTO CHEM: ICRA Assigns 'B' Ratings to INR7.25cr Loans QUICK FOODS: ICRA Assigns 'B+' Ratings to INR7.6cr Loans SHANTI EDUCATIONAL: ICRA Rates INR7.1cr LT Loan at 'B-' TRUE WELL: ICRA Assigns 'B' Ratings to INR6.50cr Loans ULTRA POWER: ICRA Assigns 'C+' Ratings to INR27.5cr Loans J A P A N TOSHIBA CORP: To Restructure TV Business to End Losses N E W Z E A L A N D DOMINION FINANCE: Three Directors Plead Guilty FIVE STAR: Williams Launders Toxic Loans, Says Court - - - - - ================= A U S T R A L I A ================= DUNDEE'S HOTEL: In Liquidation; Workers' Future in Doubt -------------------------------------------------------- Murray Valley Standard reports that employees from Dundee's Hotel, at Murray Bridge, have been stood down and are not likely to find out their fate for some time. The iconic hotel was placed into creditor's voluntary liquidation late last week with debts of about AUD2.3 million, the report relates. Doors were closed on June 21 and the hotel's 25 employees are now waiting to find out if they will re-open, Valley Standard says. According to the report, liquidator Peter Macks, from Macks Advisory, said creditors and directors would be meeting this week but it was too early to comment on the business's immediate future. He said the hotel had gone into liquidation because its owners had struggled to cope with mounting costs, the report notes. "My understanding as to why it's happened is really because the level of trading in recent times has been insufficient to deal with the cost base the business had," the report quotes Mr. Macks as saying. "It was building up losses and the companies involved had no choice but to place it into administration." INNOVATE SA: Clifton Hall Appointed as Liquidator ------------------------------------------------- Timothy Clifton of Clifton Hall was appointed as Liquidator in respect of Innovate SA Incorporated on June 25, 2013. WIRRINA COVE: Unable to Attract Bids at June 21 Auction ------------------------------------------------------- Dissolve.com.au reports that the Wirrina Cove resort and conference centre, which had been managed by receivers since 2011, was still not able to attract any bids at a June 21 mortgage sale. The sale is being handled by receiver David Whyte with Karen Seeto marketing it, the report says. Dissolve.com.au relates that the 18-hole golf course, 89-room hoteland conference centre has been the center of a marketing campaign since November of last year. It entered receivership as Equititrust Income Fund was controlled by BDO. Ms. Seeto said the receiver has been in discussions with 3 interested parties, according to Dissolve.com.au. The asset was among the last of the original 485 hectare package set, the report notes. Dissolve.com.au says assets that include a 75-lot residential development and vacant land tracts that totaled approximately 295 hectares have already been sold. The marina's thirty berths were kept and some parties are negotiating on a caravan park. WRIGHTS HOME: Appoints Clifton Hall as Liquidators -------------------------------------------------- Timothy Clifton and Mark Hall of Clifton Hall were appointed as Joint and Several Liquidators of Wrights Home Furnishers Pty Ltd on June 24, 2013. The first meeting of creditors will be held on July 5, 2013 in the offices of Clifton Hall, Level 4, 12 Gilles Street, in Adelaide at 10:00 a.m. ========= C H I N A ========= EXIM BANK: Moody's Revises Baseline Credit Assessment to ba3 ------------------------------------------------------------ Moody's Investors Service has affirmed the A3 foreign currency senior unsecured debt and issuer ratings of Export-Import Bank of Malaysia Berhad (MEXIM), as well as its (P)A3 senior unsecured MTN program rating. At the same time, Moody's has revised the bank's baseline credit assessment to ba3 from b1 following improvements in EXIM's standalone credit profile. The outlook on all EXIM's ratings remains stable. Ratings Rationale: Senior Unsecured Debt Rating Of A3 MEXIM's A3 senior unsecured rating is driven by its intrinsic credit strength, as reflected by its BCA of ba3, and six notches of uplift stemming from Moody's support assumptions. At A3, MEXIM's senior unsecured debt rating is in line with the A3 rating for the government of Malaysia. It also reflects its government ownership, its important policy role in providing financial services to Malaysian trade-oriented companies and cross-border businesses for which there is no or limited private-sector alternative offering, and Malaysia's history of lending support to government-related institutions and banks. Furthermore, although explicit support is not mandated, the bank's receipt of guarantees provided on its borrowings in 1999, liquidity support in 2007, and recapitalization through a loan-to- equity conversion in 2008 are tangible evidence of support in the past. This track record of support reinforces Moody's view that the bank will continue to benefit from government assistance, if needed. Baseline Credit Assessment (BCA) of ba3 The upward revision of MEXIM's BCA to ba3 from b1 reflects the steady improvements in the bank's asset quality and liquidity over the past three years, which reflect in turn its improved risk management culture and practices since an internal re-organization and transformation in 2008. At end-2012, its gross impaired loans ratio declined to 22.2%, from its peak level of 50% at end-2010. This decline was accompanied by a steady fall in nominal impaired loans and new impaired loan formation rates. Stability for its liquidity profile also improved, mainly from the bank's efforts in extending the tenor of its funding. At end-2012, 68% of its total borrowings showed a maturity of over five years, up from 36% a year ago. Although the bank's capital level has declined with business growth, the development is in line with Moody's expectations. At end-2012, its Tier 1 capital ratio was 41.3%. Moody's expects its capitalization to remain sufficient to withstand shocks at its current rating level. The stable ratings outlook reflects Moody's expectations that the bank's overall credit fundamentals will remain stable, underpinned by its improved risk management capabilities, in turn supporting its business growth and asset quality. At the same time, Moody's does not expect any changes to its policy status and government ownership over the next 12-18 months, which could in turn impact Moody's support assumptions. What Could Drive The Ratings Down/Up MEXIM's senior unsecured debt rating is aligned to that of the sovereign due to its important policy role. Therefore, its rating may move in line with any changes in the sovereign rating. MEXIM's BCA could move up if the bank adopted a commercial business model that would improve its profitability and asset quality metrics, although such a development could imply a reduced policy role, or a weakened relationship with the government. Conversely, any signs of weakening links with the government or diminishing policy importance could adversely affect MEXIM's debt rating. Its BCA could be revised downwards if its asset quality worsens without a commensurate increase in loan loss reserves, or its Tier 1 ratio falls below its internal target of 16%. Principal Methodology The methodologies used in this rating were Government-Related Issuers: Methodology Update published in July 2010 and Finance Company Global Rating Methodology published in March 2012. MEXIM is a development financial institution wholly owned by the government of Malaysia, with 99.9% of its share capital held by the Minister of Finance (Incorporated), and one ordinary share held by the Federal Lands Commissioner (Incorporated). MEXIM reported total assets of MYR7.3 billion (USD2.3 billion) at end-December 2012. ZUNGUI HAIXI: OSC Probes Ernst & Young Over Audit Failure --------------------------------------------------------- Ben Dummett at The Wall Street Journal reports that the Ontario Securities Commission accused Ernst & Young LLP of failing to properly audit the financial statements of Zungui Haixi Corp. ahead of the Chinese shoe maker completing a CAD39.8 million initial public offering in 2009 and listing its shares on the junior Canadian TSX Venture Exchange. The Journal notes that the allegations come after the regulator in December alleged the big accounting firm failed to adequately audit the financial statements of Sino-Forest Corp. between 2007 and 2010. The Canadian company is accused of inflating the value of its timber assets in China. Sino-Forest, which emerged from bankruptcy protection earlier this year, conducted an internal investigation into the allegations. Former company executives have denied fraud. Ernst & Young has defended its work for Sino-Forest. According to the Journal, the OSC said Monday it now alleges Ernst & Young of ignored signs Zungui may have manipulated its sales to attract investors to invest in the IPO. Ernst & Young said it plans to fight the latest charges, the report relays. "We will vigorously defend against the OSC's allegations," a spokeswoman said in an e-mailed statement obtained by the Journal. "Issues concerning Zungui Haixi came to light as a result of actions we took during our 2011 audit. We brought these issues to the attention of the audit committee and management, and eventually resigned as auditor. We have cooperated with the OSC throughout its subsequent investigation." The OSC is scheduled to hold a hearing on the allegations July 15, the Journal adds. Zungui Haixi Corporation, through its subsidiaries, engages in the manufacture and sale of athletic footwear, apparel, accessories, and casual leather footwear in the People's Republic of China. * Chinese Issuers Continue to Replenish Land Banks Says Moody's --------------------------------------------------------------- Moody's Investors Service says its rated developers have been active in acquiring new land in the past two months. "We expect our rated developers will remain active in land acquisitions in the coming three to six months, as they continue to replenish their land banks to support their long-term growth plans," says Kaven Tsang, a Moody's Vice President and Senior Analyst. Large national developers, such as China Overseas Land & Investment Limited (Baa1 stable), China Vanke Co. Ltd. (Baa2 stable) and Poly Real Estate Group Co Ltd (Baa2 stable) have acquired new land to replenish their land banks. Meanwhile, a few regional players -- Yuexiu Property Company Limited (Baa3 stable), Kaisa Group Holdings Limited (B1 stable) and CIFI Holdings (Group) Co Ltd (B1 stable) -- have made sizeable acquisitions in May and June. "While their liquidity positions will remain adequate, the sizable acquisitions will increase their execution risk," adds Tsang. Tsang was speaking at the release of the latest edition of Moody's China Property Focus newsletter. The growth momentum in China's property market continued in May, but the year-on-year growth rate slowed down to 33.9% from 56.8% in April owing to: (1) the State Council's policy guidelines announced in February to increase controls on the sector; and (2) a higher comparative base in May last year when the market picked up. "We expect year-on-year sales growth will continue to slow down in the coming months amidst tight controls and a higher comparative base in the second half of 2012," says Tsang. The report also states that property prices in China's 70 major cities continued to climb in May 2013. The number of cities with year-on-year growth in prices increased to 69 in May from 68 in April, and which was the highest level since September 2011. In addition, the number of cities with price increases of more than 5% year-on-year surged to 38 from 24 in the previous month, and which was the highest level since April 2011. Moody's expects the government will maintain its tight controls on the property sector, given the robust price growth over the past few months. But further dramatic measures are unlikely as the month-on-month price growth in six of the major cities, including Beijing and Guangzhou, moderated to 1%-2% in May 2013 from 2%-3% in March. The report also states that the credit profiles of rated developers will remain largely stable in the next twelve months. There were no rating changes in Moody's portfolio since the last publication; just over 80%, or 33 out of 41 developers, had stable rating outlooks as of 20 June 2013, versus 20 at end-2012. Their stable outlooks reflect an improved operating environment, their enhanced liquidity positions, as well as Moody's expectation that the risks from the government's new tightening measures will be manageable. ========= I N D I A ========= AA NUTTS: ICRA Assigns 'BB' Rating to INR0.80cr Loans ----------------------------------------------------- ICRA has reaffirmed the '[ICRA]BB' rating to the INR1.50 crore long term fund based facilities (sub limit) of AA Nutts. ICRA has assigned a long term rating of '[ICRA]BB' to the INR0.80 crore term loan facilities of AA Nutts. The outlook on the long term rating is stable. ICRA has also reaffirmed the '[ICRA]A4' rating to the INR13.00 crore (enhanced from INR9.60 crore) short term fund based facilities and the INR3.50 crore short term non fund based facilities (sub limit) of the firm. Amount Facilities (INR Cr) Ratings ---------- -------- ------- Long Term loans 0.80 [ICRA]BB(Stable)/assigned Long term fund (1.50) [ICRA]BB(Stable)/reaffirmed based facilities (sub-limit) Short term fund 13.00 [ICRA]A4/reaffirmed/ assigned based facilities Short term non fund (3.50) [ICRA]A4/reaffirmed based facilities (sub-limit) ICRA has taken a consolidated view of AA Nutts and another group entity, Al Aziz and Company for the purpose of ratings, on account of the common management and close operational linkages among the aforementioned entities. The reaffirmation of ratings takes into account the long standing experience of the promoter in the cashew processing business and the healthy growth in revenues during 2011-12 and 2012-13, supported by both increase in sales volume and average realizations. The ratings also positively factor in the firm's operational linkages with group entities, which aid AA Nutts in enhancing its business capabilities. The ratings are, however, constrained by financial profile of the firm, characterised by a) thin margins owing to low value addition/product differentiation and a highly competitive and fragmented industry structure, b) high working capital intensity, resulting in high debt levels compared to the scale of operations, c) stretched gearing and coverage indicators owing to high debt levels amidst thin accruals, and d) strained cash flows on account of high working capital requirements amidst thin operating profits. The ratings also take into account the prevailing labor shortage in the region and its current impact/possible impact on the firm's margins, owing to fulfilment of orders through third party purchases; the firm does not have any mechanization or diversification plans in the near term. Akin to other players in the industry, AA Nutts' margins are vulnerable to volatility in cashew price movements and forex fluctuations, although the latter is mitigated to an extent by the hedging mechanism adopted by the firm. AA Nutts also has high geographic concentration with the United States of America (USA). Commenced in 2007 as a partnership firm, AA Nutts is engaged in sale of cashew kernels and raw cashew nuts (RCNs). The firm procures its raw materials primarily from Africa and Indonesia, processing them in its manufacturing facilities located in Kollam, Kerala and primarily exports the processed blanched cashew kernels to USA, Europe and the Middle East countries. Part of the sales is also done in domestic markets and in through merchant exports, although these have remained less than 30% in the last few years. The firm is currently managed by Mr. M. A. Anzar. AFEEF CASHEW: ICRA Reaffirms 'BB' Rating on INR3cr LT Loan ---------------------------------------------------------- ICRA has reaffirmed the '[ICRA]BB' rating to the INR3.00 crore long term fund based facilities (sub limit) of Afeef Cashew Company. The outlook on the long term rating is stable. ICRA has also reaffirmed the '[ICRA]A4' rating to the INR13.20 crore (enhanced from INR11.00 crore) short term fund based facilities and the INR3.50 crore short term non fund based facilities (sub limit) of the firm. ICRA has also assigned a short term rating of '[ICRA]A4' to INR1.14 crore non-fund based facilities of Afeef. Amount Facilities (INR Cr) Ratings ---------- -------- ------- Long Long term fund (3.00) [ICRA]BB(Stable)/reaffirmed based facilities (sub-limit) Short term fund based 13.20 [ICRA]A4/reaffirmed facilities Short term non fund (3.50) [ICRA]A4/reaffirmed Based facilities (sub-limit) Short term non fund 1.14 [ICRA]A4/assigned based facilities ICRA has taken a consolidated view of Afeef Cashew Company and another group entity, Alpha International for the purpose of ratings, on account of the common management and close operational linkages among the aforementioned entities. The reaffirmation of ratings takes into account the long standing experience of the promoter in the cashew processing business and the healthy growth in revenues during 2011-12 and 2012-13 supported by both increase in sales volume and average realizations. The ratings also positively factor in the firm's operational linkages with group entities, which aid Afeef in enhancing its business capabilities. The ratings are, however, constrained by weak financial profile of the firm, characterised by a) thin margins owing to low value addition/product differentiation and a highly competitive and fragmented industry structure, b) high working capital intensity, resulting in high debt levels compared to the scale of operations, c) stretched gearing and coverage indicators owing to high debt levels amidst thin accruals, and d) strained cash flows on account of high working capital requirements amidst thin operating profits. The ratings also take into account the prevailing labour shortage in the region and its impact on the firm's margins, owing to fulfilment of orders through third party purchases; worsening of the situation is likely to impact the firm further, in the absence of any mechanization or diversification plans in the near term. Akin to other players in the industry, Afeef's margins are vulnerable to volatility in cashew price movements and forex fluctuations, although the latter is mitigated to an extent by the hedging mechanism adopted by the firm. Afeef also has high geographic concentration with the United States of America (USA). Commenced in 2007 as a partnership firm, Afeef Cashew Company is engaged in sale of cashew kernels and raw cashew nuts (RCNs). The firm procures its raw materials primarily from Africa and Indonesia, processing them in its manufacturing facilities located in Kollam, Kerala and primarily exports the processed blanched cashew kernels to USA, Europe and the Middle East countries. Part of the sales is also done in domestic markets and in through merchant exports, although these have remained less than 30% in the last few years. The firm is currently managed by Mr. Mohammed Najeeb. AGARWAL FASTENERS: ICRA Assigns 'BB+' Ratings to INR18cr Loans -------------------------------------------------------------- ICRA has assigned an '[ICRA]BB+' rating to the INR8.00 crore fund-based bank facilities and the INR10.00 crore term loans of Agarwal Fasteners Private Limited. The outlook on the long-term rating is 'stable'. ICRA has also assigned an '[ICRA]A4+' rating to the INR8.00 crore fund based and INR4.00 crore non-fund-based bank facilities of AFPL. Amount Facilities (INR Cr) Ratings ---------- -------- ------- Long-term, fund- 8.00 [ICRA]BB+ (Stable) assigned based limits Term Loans 10.00 [ICRA]BB+ (Stable) assigned Short-term, fund- 8.00 [ICRA]A4+ assigned based limits Short-term, non- 4.00 [ICRA]A4+ assigned fund based limits The assigned ratings take into account long experience of the promoters in the stainless steel fasteners industry; strong distribution capability of AFPL, in form of large dealer network, which gives the company pan-India coverage for its products and wide product range of the company, catering to multiple sectors, which reduces industry specific risks. However, the ratings are constrained by high gearing of the company; highly fragmented and unorganized nature of the fasteners industry, which exerts pricing pressures; exposure to price risks, given the cyclicality inherent in the stainless steel industry and moderately high working capital intensity of operation, which adversely impacts liquidity profile of the company and exposure to forex risk, given the significant dependence on exports and in the absence of a formal hedging mechanism. Incorporated in 1987, AFPL is closely held by Agarwal family and is involved in manufacture of stainless steel nuts and bolts. The manufacturing facility of AFPL is ISO 9001:2008 certified. During first half of 2012-13, AFPL has shifted its main manufacturing facility from Vasai to Palghar, both of which are located in Thane district of Maharashtra. Recent Results As per the provisional results for the first eleven months of 2012-13, AFPL recorded profit before tax of INR5.38 crore on the back of an operating income of INR105.44 crore. In 2011-12, AFPL recorded a profit after tax (PAT) of INR2.67 crore on an operating income of INR106.89 crore. ALLIED MEDICAL: ICRA Cuts Rating on INR13cr Loans to '[ICRA]BB+' ---------------------------------------------------------------- ICRA has revised the long term rating for 13.00 crore (earlier INR11.04 crore) term loans and fund-based limits of Allied Medical Limited from '[ICRA]BBB-' to '[ICRA] BB+'. The long-term rating carries a stable outlook. ICRA has also revised the short-term rating for INR6.00 crore (earlier INR1.50 crore) non-fund-based limit of AML from '[ICRA]A3' to '[ICRA]A4+'. Amount Facilities (INR Cr) Ratings ---------- -------- ------- Long Term Loans and 13.00 [ICRA]BB+ {Revised from Fund-based Limits [ICRA]BBB-} Non-fund-based Limits 6.00 [ICRA]A4+ {Revised from [ICRA]A3} The revision in ratings reflects significant liquidity pressure faced by AML, as indicated by persistently high utilization of working capital limits. The liquidity strain has built up due to elevated working capital intensity on account of stretched receivables, high inventory levels and limited credit offered by principals. Also, the company has incurred significant expenditure on equipments and research and development which has impacted its liquidity position. The ratings continue to be constrained by AML's moderate scale of operations, near-stagnant revenue growth over the last three years and fragmented industry structure characterized by large number of players dotting the spectrum leading to high competitive intensity. ICRA also notes that the company is exposed to risks associated with fluctuations in foreign exchange rates on account of imports of medical equipments and will be impacted by recent depreciation of Indian National Rupee (INR). The ratings, however, derive comfort from AML's experienced and technically qualified promoters with long track record in the medical equipment industry; established relationships with some of the global medical equipment companies; its diversified customer base, with a healthy mix of private sector and government clients and the stable demand prospects for medical equipments in India. Going forward, easing of liquidity pressures and improvement in scale of operations while maintain the credit metrics will be the key rating sensitivity. Allied Medical Limited was promoted by Dr. Vinod Kohli and his family in 1982 and is engaged in manufacturing and trading of anesthesia and other medical equipment. The manufacturing facilities of the company are located in the city of Gurgaon (Haryana). AML is ISO 9001:2000 and ISO 13485 certified for Design, Manufacture, Supply and Service of Medical Surgical and Hospital Equipments; it is also accredited with GMP (Good Manufacturing Practices) certification recognized by World Health Organisation (WHO). The R&D division of the company is recognized by Ministry of Science & Technology. Recent Results In FY2013, as per the provisional financial statements, Allied Medical Limited (AML) reported operating income of INR40.12 crore (previous year INR39.05 crore) and net profit of INR1.66 crore (previous year INR2.00 crore). ARADHNA FABRICS: ICRA Reaffirms 'BB-' Ratings on INR13.22cr Loans ----------------------------------------------------------------- ICRA has reaffirmed the long-term rating of '[ICRA]BB-' to the INR13.02 crore1 fund based and INR0.20 crore non-fund based bank facilities of Aradhna Fabrics Private Limited. The outlook on the long term rating continues to remain Stable. Amount Facilities (INR Cr) Ratings ---------- -------- ------- Long Term Fund 13.02 [ICRA]BB-(Stable)/Reaffirmed Based Limits Long Term Non-Fund 0.20 [ICRA]BB-(Stable)/Reaffirmed Based Limits The rating reaffirmation draws comfort from the experience of the promoters, who have been in the textile industry for more than three decades. The operational profile of the company has remained stable in the past few years with more than 90% of the revenues being derived from low value add knitting and fabric processing operations, which coupled with subdued demand has resulted in low operating profitability. Thus, despite a moderately geared capital structure, low profitability of operations has resulted in weak debt coverage indicators of the company as reflected by interest coverage of 1.92x, TD/OPBDITA of 3.94x and NCA/TD of 9% in FY13 as per the provisional results. The company had written off receivables of INR1.72 crore from one of its garment customers in 2011-12, which resulted in a decline in the operating profitability from 3.9% in FY11 to 1.4% in FY12. Although profitability has improved to ~5% in FY13 as per the provisional results, a large proportion of the sales continues to be contributed from the knitting, fabric processing and trading activities, which is expected to be continued in the near term, which shall keep the profitability low and debt coverage indicators weak. The rating continues to remain constrained by stagnancy in turnover witnessed by the company and modest scale of operations in a fragmented and competitive industry which is dominated by the unorganized sector, thereby limiting its pricing power and benefits of economies of scale. Given the low entry barriers, AFPL's business growth and profitability will continue to remain susceptible to entry of new players in the industry; however the company's forward integration into garmenting segment, which by virtue of higher value addition and better realizations could improve the overall profitability going forward as the company scales up its modest scale of garmenting operations. Going forward, an improvement in the profitability which shall be largely dependent on the company's ability to scale up its garmenting business and subsequently the extent of improvement in debt coverage indicators would be the key rating sensitivities. AFPL was incorporated in November 1995 and is promoted by Mr. Ashok Avasthi. The company started with the fabric knitting and during FY 2001-02, forward integrated into manufacturing of readymade garments for kids under its brand ATOZ and Kids First. However, due to fire at its garmenting unit in April 2007, the garmenting operations were suspended for ~2 years and were resumed in October 2009. Currently the company is primarily engaged into fabric knitting & processing and manufacturing of garments for other domestic apparel brands at its unit in Ludhiana (Punjab) with an installed capacity of 7.5 tons per day for knitted fabric and 2,000 garment pieces per day. AFPL is also engaged in trading of yarn and fabric which accounted for 4% of total sales in FY 2012-13. Recent Results: As per the provisional results for FY13, AFPL had net profit of INR0.43 crore on operating income of INR52.22 crore as against net profit of INR0.48 crore and operating income of INR53.55 crore and for the year ending March 2012. CARRYCON INDIA: ICRA Upgrades Ratings on INR10.3cr Loans to 'B+' ---------------------------------------------------------------- ICRA has upgraded the rating for INR5.0 crore fund-based limits and INR5.3 crore non-fund based limits (enhanced from INR2.5 crore earlier) of Carrycon India Limited from '[ICRA]B' to '[ICRA]B+'. Amount Facilities (INR Cr) Ratings ---------- -------- ------- Long Fund Based 5.0 [ICRA]B+; Upgraded from Limits [ICRA]B Non-Fund Based 5.3 [ICRA]B+; Upgraded from Limits [ICRA]B The upgrade of CIL's rating factors in better revenue visibility on account of its improved order-book position as it had secured large projects in civil construction segment apart from its traditional telecom networking projects. With diversification into civil construction business, CIL's working capital intensity has also improved, nevertheless it remains high at 44% in FY13. The rating continues to take support from CIL's long track record in the telecom infrastructure support business, its experienced promoters, and its association with some reputed companies. CIL's rating is, however, constrained by its weak liquidity position, and limited financial flexibility owing to modest net-worth and low profitability. The rating is also constrained by business risk arising out of its modest scale of operations, and exposure to fluctuations in raw-material prices. In ICRA's opinion due to expected increase in CIL's scale of operations supported by its relatively large order-book, its funding requirement are likely to increase, thus its ability to get its bank lines enhanced and/or raise funds through equity dilution will be critical. Going forward, the company's ability to improve upon its profitability and efficiently manage its working capital cycle will be amongst the key rating sensitivity factors. Incorporated in 1995, Carrycon India Limited is promoted by Mr. G. D. Rao, Mr. Prakash Bhanu, and Mrs. Sadhana Rao. CIL provides civil contractor/engineering services in the area of installing infrastructure for Telecom support services, Telecom network maintenance services, and installation of telecom towers, water supply, sewerage, de-silting, trunk sewer lines and civil construction work. Recent Results As per the provisional financial results for the FY13, the company had operating income (OI) of INR22.1 crore and profit after tax (PAT) of INR0.35 crore as compared to OI of INR17.4 crore and PAT of INR0.35 crore in FY12. CP SPONGE: ICRA Assigns 'B+' Ratings to INR23.12cr Loans -------------------------------------------------------- ICRA has assigned a long term rating of '[ICRA]B+' to the INR3.125 crore term loan and INR20.00 crore cash credit facilities of C. P. Sponge Iron Private Limited. Amount Facilities (INR Cr) Ratings ---------- -------- ------- Long Fund Based- 20.00 [ICRA]B+ assigned Cash Credit Fund Based-Term 3.12 [ICRA]B+ assigned Loan The rating takes into consideration the weak financial profile of the company, as characterised by its declining profitability, low returns from business and weak coverage indicators. The rating also factor in the inherent vulnerability of CPSIPL to the cyclicality in the steel industry, which is currently passing through a difficult phase and the high working capital intensity of operations which is likely to exert pressure on the liquidity position of the company at least in the near term. CPSIPL also has capital expenditure (capex) plans, the size of which is large relative to its current balance sheet size. This is likely to expose the company to project execution risks and funding risks, in ICRA's opinion. The rating however favorably takes into account the experience of the promoters in the steel industry, and the fuel supply agreement with Eastern Coalfields Limited for partial supply of coal ensuring steady availability of one key raw material and reducing costs to an extent. ICRA notes that a group company of CPSIPL has downstream facilities and this reduces its off-take risks. The ability of the company to improve its profitability margins and reduce its working capital intensity would remain key rating sensitivity going forward. Incorporated in 2002, C. P. Sponge Iron Private Limited (CPSIPL) manufactures sponge iron with an annual production capacity of 60,000 tons per annum (tpa). The plant is located at Durgapur in West Bengal with two DRI kilns of capacity 100 tpd (tons per day). Recent Results The company reported a net profit of INR0.72 crore on an operating income of INR84.08 crore as per the provisional results during FY13 as compared to a net profit of INR0.55 crore on an operating income of INR58.06 crore during FY12. DEEPAK STEEL: ICRA Cuts Rating on INR40cr Loan to 'BB+' ------------------------------------------------------- ICRA has revised downwards the rating assigned to the INR40.00 crore (enhanced from INR20.00 crore) cash credit facility of Deepak Steel & Power Limited from '[ICRA]BBB-' to '[ICRA]BB+'. The outlook on the long term rating has been revised from Negative to Stable. ICRA has also revised downwards the rating assigned to the INR10.00 crore (enhanced from INR3.12 crore) non-fund based bank facilities of DSPL from '[ICRA]A3' to '[ICRA]A4+'. The [ICRA]A3 rating assigned earlier to the INR35.00 crore fund based facility has been withdrawn. Amount Facilities (INR Cr) Ratings ---------- -------- ------- Long Fund Based Limit- 40.00 [ICRA]BB+ (Stable) Cash Credit downgraded Non-Fund Based Limits- 10.00 [ICRA]A4+ downgraded/ Bank Guarantee/Letter of assigned Credit/Forward Contract Fund Based Limit-Export Nil [ICRA]A3 withdrawn Packing Credit/Short Term Loan The rating revision primarily takes into account the ongoing supply-side bottlenecks and an adverse demand scenario in the steel industry, affecting both the manufacturing and trading activities of the company, which in turn have led to a significant decline in turnover over the last two years. The working capital intensity of DSPL also increased sharply during 2012-13 on account of mounting receivables and inventory levels, negatively impacting the company's liquidity position. The ratings, however, continue to factor in the experience of DSPL's promoters in the steel industry, proximity of DSPL's plant to raw material sources leading to low freight costs and the company's conservative capital structure, aided by regular equity infusions. ICRA notes that DSPL has been allotted mining rights for both iron ore and coal which, post commissioning, is likely to improve the cost structure of the company. Nevertheless, delay in commissioning of the coal and iron ore mines and the limited availability of iron ore in Odisha due to the decline in the mining activities have led to low capacity utilization in its existing facilities. The company has discontinued production of billets and has shutdown one of its manufacturing units (at Uliburu) since September 2012. The ratings also reflect the inherent vulnerability of DSPL to the cyclicality in the steel industry, which is likely to keep the company's margins and cash flows volatile in future. DSPL, formerly known as Deepak Industries (P) Ltd, was incorporated in 1994 and was subsequently converted into a public limited company in 2003. The company, promoted by the Gupta family of Barbil, Odisha, is engaged in the manufacturing of sponge iron (2,49,000 TPA) and billet (1,11,000 TPA). The company also has a power generating capacity of 38 MW at present. The manufacturing facilities of DSPL are located at Jharibahal, Topadihi and Uliburu in Odisha. Previously, DSPL had also been engaged in the export of iron ore fines and trading of sized iron ore in the domestic market, which were discontinued since November 2011. Recent Results During 2012-13, DSPL reported a net profit of INR1.57 crore (provisional) on an operating income of INR129.43 crore (provisional), as compared to a net profit of INR2.63 crore on an operating income of INR214.25 crore during 2011-12. EXCEL ANO: ICRA Rates INR3.35cr Loans at '[ICRA]B+' --------------------------------------------------- ICRA has assigned a long term rating of '[ICRA]B+' to INR3.35 crore fund based limits of Excel Ano Components. ICRA has also assigned a short term rating of '[ICRA]A4' to INR1.40 crore non fund based limits and INR0.25 crore fund based limits of EAO. Amount Facilities (INR Cr) Ratings ---------- -------- ------- Long Fund based limits 3.35 Assigned [ICRA]B+ Fund based limits 0.25 Assigned [ICRA]A4 Non Fund based limits 1.40 Assigned [ICRA]A4 The assigned ratings are constrained by EAO's small scale of operations; modest profitability and the high working capital intensity of operations as reflected in NWC/OI of 41% for FY2013 on account of high receivables(debtor days of 118 for FY2012-13). The small size of the company vis-�-vis peers in the industry and customers results in low bargaining power in the highly fragmented Aluminium extrusion industry which is also likely to exert pressure on the profitability levels of the firm. ICRA on the other hand also considers the long track record of the promoters in the industry and established relationships with reputed players like Hawkins Cooker Limited. Excel Ano Components is a partnership firm engaged in manufacturing Aluminium extrusions through its facilities located in Hyderabad, Andhra Pradesh. The firm has a capacity to manufacture ~2400 MT per annum. The firm is managed by Mr. Sarva Nagender who has experience of over 2 decades in the Aluminium extrusion industry. Recent Results The firm reported an operating income and profit of INR9.49 crore and INR0.50 crore respectively in FY2013 (as per provisional and unaudited statements) as against an operating income and net profit of INR9.99 crore and INR0.14 crore respectively in FY2012. HARSHA STONE: ICRA Assigns 'B-' Rating to INR0.44cr Loan -------------------------------------------------------- ICRA has assigned '[ICRA]B-' rating to the INR0.44 crores long term fund based limits and '[ICRA]A4' rating to the INR5.50 crores short term fund based limits of Harsha Stone Industries. ICRA has also assigned '[ICRA]A4' rating to the INR1.56 crore unallocated short term fund based limits of HSI. Amount Facilities (INR Cr) Ratings ---------- -------- ------- Long Long term 0.44 [ICRA]B- assigned Fund based limits Short term fund 5.50 [ICRA]A4 assigned based limits Unallocated short 1.56 [ICRA]A4 assigned term fund based limits The assigned ratings are constrained by intensely competitive nature of stone processing industry, HSI's modest scale of operations and low value additive nature of its operations. The ratings also factor in the firm's modest financial risk profile as reflected by low profitability, high gearing levels, moderate coverage indicators and high working capital intensity of operations. Further HSI is a partnership firm and any significant withdrawals from the capital account could adversely impact its net worth and thereby the capital structure. Nevertheless, the ratings derive comfort from the long experience of the promoters in this business and their established relationship with customers. Going forward, ability of the firm to increase its scale of operations in a profitable manner while maintaining working capital intensity will be key rating sensitivities. Harsha Stone Industries was established in the year 1988 as a partnership firm. It is engaged in the processing of natural stone products primarily sandstone. The manufacturing facility of the firm is located at Kota in Rajasthan and Betamcharia in Andhra Pradesh. The firm exports mainly to European countries. The firm reported a net profit of INR0.21 crores on an operating income of INR12.73 crores in FY12 as against net profit of INR0.14 crores on an operating income of INR8.64 crores in FY11. HMM INFRA: ICRA Assigns 'B' Rating to INR10cr Loan -------------------------------------------------- ICRA has assigned an '[ICRA]B' and '[ICRA]A4' ratings to the INR14.00 crore Fund and Non-Fund Based bank limits of HMM Infra Limited. Amount Facilities (INR Cr) Ratings ---------- -------- ------- Long Fund Based 10.00 [ICRA]B (Assigned) Facilities Non-Fund Based 4.00 [ICRA]A4 (Assigned) Facilities The ratings reflect HMM's weak financial profile characterized by declining turnover and net losses during FY2010-12 owing to reduced demand for bus coaches from the main clients which include Tata Motors and Ashok Leyland. The liquidity profile of the company also turned adverse during this period owing to weak cash accruals coupled with significant annual debt repayment obligations and full utilization of working capital limits. The ratings are further constrained due to vulnerability of profits to movements in the steel prices given the fixed price nature of contracts and high inventory holdings. However, the rating favorably takes into account HMM's experienced management, company's long track record in the steel fabrication business and healthy order flow for the recently started business, fabrication of heavy steel structures which provides visibility to revenues in the short to medium term. Going forward, HMM's ability to secure new orders, grow its revenues while improving its profitability and capital structure will be amongst the key rating sensitivity factors. HMM INFRA LIMITED formerly known as HMM Coaches Ltd is a public limited company incorporated in 1996 and has been historically involved in the fabrication of automobiles body unit at village Mandour (Ambala). The company is promoted by the Goel family of Haryana and has two manufacturing units, in Ambala (Haryana) and Khapoli (Punjab). The unit in Khapoli was sold off in 2012; however, the company is yet to receive the complete payment for the sale. Its main promoter, Mr. Bhupinder Goel has about 20 years experience in the business of auto body building. With the reduced demand for automobiles body since FY2011, the company diversified into manufacturing heavy steel structures and installed an annual capacity of 24,000 MT p.a. Its product profile includes box & H beams, crane girders, composite steel plate girders which find their use in rail over bridges, solar power plants, tube & pipe punching machine etc. Recent results: In FY2013, HMM reported a profit after tax (PAT) of INR0.23 crore on an operating income (OI) of INR38.61 crore as against a PAT of INR-1.00 crore on an OI of INR38.61 crore in the previous year. PHYTO CHEM: ICRA Assigns 'B' Ratings to INR7.25cr Loans ------------------------------------------------------- ICRA has assigned a long term rating of '[ICRA]B' to INR7.00 crore fund based and INR0.25 crore non fund based bank facilities of Phyto Chem (India) Limited. ICRA has also assigned a short term rating of '[ICRA]A4' to the INR3.50 crore non fund based bank facilities of PCIL. Amount Facilities (INR Cr) Ratings ---------- -------- ------- Long Fund bases 7.00 [ICRA]B assigned Facilities Bank Guarantee 0.25 [ICRA]B assigned LC/ILC 3.50 [ICRA]A4 assigned The [ICRA]B/[ICRA]A4 ratings are constrained by the inherent vulnerability of the pesticides and agro-chemical (PAC) business to adverse agro-climatic conditions, limited client base of the company and absence of any long term tie-ups resulting in high volatility in institutional sales, high working capital intensity and the fragmented nature of the PAC industry. Since PCIL's sales are limited to the domestic market (and more particularly within Andhra Pradesh (AP) which contributes close to 90% of total revenues), the company is directly exposed to variations in monsoon conditions and crop acreage. PCIL's working capital intensity is also high on account of long recovery times of over 6 months for significant amount of receivables, and high raw material inventory which is partially offset by relatively high credit period on imports (backed by LC facility). The ratings draw comfort from the long track record of the promoters in the PAC business. ICRA also notes that PCIL is diversifying its retail network to other states which is expected to reduce dependence on AP market over medium term. PCIL was incorporated on 11th January, 1989 as a Private Limited Company named Phyto Chem (India) Private Limited in the State of Andhra Pradesh. The company had a public issue in January 1995 and got listed on the Bombay Stock Exchange. The Company is engaged in manufacture of Pesticides, Insecticides and related products. PCIL has a plant for production of Pesticides Formulations, located in Bonthapally -- 40kms from Hyderabad. Recent Results PCIL recorded a net profit of INR0.64 crore on a turnover of INR33.47 in FY 13 when compared to INR0.95 crore and INR26.93 respectively in FY 12. QUICK FOODS: ICRA Assigns 'B+' Ratings to INR7.6cr Loans -------------------------------------------------------- The rating of '[ICRA]B+' has been assigned to INR4.00 crore fund based cash-credit facility and INR3.60 crore term loan facility of Quick Foods Co. A rating of '[ICRA]A4' has also been assigned to INR0.25 crore short-term non-fund based facility of QFC. Amount Facilities (INR Cr) Ratings ---------- -------- ------- Long Cash Credit 4.00 [ICRA]B+ assigned Term Loan 3.60 [ICRA]B+ assigned Bank Guarantee/Import 0.25 [ICRA]A4 assigned LC/FSC The assigned ratings are constrained by QFC's limited track record of operations and stretched liquidity position marked by high inventory levels on account of seasonal nature of operations. The ratings also factor in the stressed capital structure of the firm owing to initial debt funded capex and vulnerability of profitability to fluctuations in raw material prices which are subject to seasonality and crop harvest. ICRA further incorporates the intense competition in the food processing industry and low brand visibility and the partnership status of QFC, whereby any significant withdrawals from the capital account could affect its net worth and thereby its capital structure. The ratings, however, favorably factor in the long experience of the promoters in food processing business; positive demand outlook given the government's initiatives to promote food industry as well as growing demand for ready to eat food on account of changing food habits across urban regions in India. Quick Foods Co. was incorporated in the year 2009 and is engaged in manufacturing of dehydrated and frozen products with its manufacturing facilities located in Gomta, Gujarat. It is a group company of Pardes Dehydration Co., engaged in dehydration of vegetables. QFC was formed with a motive to add more value added products under the group's banner. The firm is currently headed by Mr. Hitendra Parekh, who has been present in food processing industry since 1983. SHANTI EDUCATIONAL: ICRA Rates INR7.1cr LT Loan at 'B-' ------------------------------------------------------- ICRA has assigned an '[ICRA]B-' rating to the INR7.1 crore term loan of Shanti Educational Trust. Amount Facilities (INR Cr) Ratings ---------- -------- ------- Long Term Loan 7.1 [ICRA]B- Assigned The rating takes into consideration the nascent stage of SET's operations as the school commenced operations from April 2013, affiliation from Central Board of Secondary Education (CBSE) yet to be received, aggressive funding structure for setting up the school and the board performance of the students yet to be tested, which could impact the admissions going forward. The rating takes into account the large number of admissions at SET for during the first academic year of 2013-14 and the established franchise partner -- G. D. Goenka Public School under which SET has set up its school. SET was established in 2010 as a trust in Patna, Bihar. The trust has started a school as a franchisee of G.D. Goenka Public School and the first batch of 257 students have been admitted for the academic session 2013-14. TRUE WELL: ICRA Assigns 'B' Ratings to INR6.50cr Loans ------------------------------------------------------ ICRA has assigned long-term rating of '[ICRA]B' to INR6.20 crore fund based limits of True Well Pipe Industries. ICRA has also assigned ratings of '[ICRA]B/[ICRA]A4' to INR0.30 crore unallocated limits of TWPI. Amount Facilities (INR Cr) Ratings ---------- -------- ------- Long Fund based 6.20 [ICRA]B assigned Limits Unallocated Limits 0.30 [ICRA]B/[ICRA]A4 assigned The assigned ratings are constrained by the highly competitive and fragmented nature of the pipe industry leading to pressure on margins; project execution risk due to nascent stage of construction of HDPE pipe manufacturing facility; and risks arising from proprietorship nature of the firm. Additionally, marketing risk of the new product being a new area of business for TWPI; the firm's stressed cash flows due to debt funded expansion and high working capital requirements and vulnerability of profitability to the fluctuations in key raw material prices as it constitutes more than 80% of the cost of production constrain the ratings. The ratings, however, favorably factor in the long experience of the promoter of about two decades in Pipe industry; steady increase in revenues albeit on a small base and favorable growth prospects driven by demand in drip irrigation and government's impetus on road development projects. The ability of the entity to complete the project without time & cost overruns, scale up volumes and profitability while managing its working capital cycle will be the key rating sensitivities from credit perspective. Founded in 1997, True Well Pipe Industries was a partnership firm between the two partners, Mr. V.M. Rama Krishna and Mr T. Gopalakrishna to manufacture rigid PVC tubes. However in the year 1997, Mr. T. Gopalakrishna retired from the firm and consequently the firm was dissolved and Mr. V.M. Rama Krishna took over the firm and registered under his proprietorship concern. The manufacturing unit is located in Nellore District of Andhra Pradesh. In 2008, the promoter leased out an outlet to increase its scale of operations. Recent Results In 2012-13, TWPI reported net profit of INR0.11 crore (provisional) on operating income of INR26.62 crore (provisional) as against net profit of INR0.09 crore on operating income of INR22.17 crore in 2011-12. ULTRA POWER: ICRA Assigns 'C+' Ratings to INR27.5cr Loans --------------------------------------------------------- ICRA has assigned a long term rating of '[ICRA]C+' to the INR19.50 crore long-term fund based limits and the INR8.00 crore unallocated limits of Ultra Power Projects Pvt. Ltd. Amount Facilities (INR Cr) Ratings ---------- -------- ------- Long Fund based 19.50 [ICRA]C+ assigned Limits Unallocated 8.00 [ICRA]C+ assigned The assigned rating is constrained by the absence of firm fuel supply arrangements for UPPPL's 7.5 MW Industrial Waste based power plant located in Andhra Pradesh, shortage in availability of rice husk, poultry litter and the other raw materials and the consequent volatility in PLF (Plant Load Factor) levels as demonstrated by the recent dip in power generation. The rating also negatively factors in the fixed price nature of the twenty years Power Purchase Agreement (PPA) with Central Power Distribution Company of Andhra Pradesh Limited limiting the company's ability to pass through any increase in raw material prices. ICRA notes that financial profile of the company is weak characterised by volatility in profits on account of fluctuations in raw material prices and power generation levels, weak coverage indicators and a negative net worth owing to the recent vintage of plant and machinery. In addition, UPPPL is also exposed to counter party risk given that it sells its entire power output to APCPDCL. Considering the limited availability of raw material and consequently low projected capacity utilization, ICRA notes that infusion of funds by the promoters would be critical to timely debt servicing. However, ICRA's rating draws comfort from the presence of a long term PPA with assured off take of the power generated, stabilization of operations since commencement of commercial operations in June, 2010. UPPPL operates an Industrial Waste based power plant with an installed capacity of 7.5 MW located in Yacharam, Ranga Reddy District in A.P. The power generated from this plant which began its commercial operations in June 2010 is sold to APTRANSCO under a twenty-year PPA. UPPPL is a part of the "Ultra" group of companies which have interests in manufacture and supply of defence equipment for the Indian Navy under their group company Ultra Dimensions Private Limited. The group also undertakes pipe fabrication works, annual contracts for ship maintenance for the Navy. Recent Results (Provisional) UPPPL has, for the year ended March 31, 2013 reported an operating income of INR14.57 crore and a net loss of INR5.02 crore as against INR22.68 crore and INR4.42 crore respectively for 2011-12. ========= J A P A N ========= TOSHIBA CORP: To Restructure TV Business to End Losses ------------------------------------------------------ Naoko Fujimura & Takashi Amano at Bloomberg News report that Toshiba Corp. will present a restructuring plan in July designed to turn around television operations that have lost $1 billion in the past two years. The Japanese maker of flash-memory chips, elevators and reactors plans to make the unit profitable in the second half of this business year ending March 31, Hisao Tanaka, who became president yesterday, told reporters in Tokyo earlier this month, Bloomberg reports. Bloomberg notes that Toshiba and Sony Corp. are among Japanese companies that have been reorganizing businesses for years, trying to revive TV operations hurt by falling prices and a strong yen. At the same time, the report relates, they have tried to speed up development on new products to lure back customers from industry leaders Apple Inc. and Samsung Electronics Co. According to Bloomberg, the maker of Regza TVs needs to offer more value-added models, while cutting fixed costs and inventories, Mr. Tanaka said, adding details of the plan have yet to be decided. "Cutting fixed costs by just 10 billion yen ($103 million) isn't enough," the report quotes Mr. Tanaka as saying. Bloomberg relates that Mr. Tanaka said the company, whose sales shrank 24 percent in the past five years, plans to set up a new division to house patents held by various companies within the Toshiba group. These previously tended to be used separately within each division, limiting the potential for sharing innovation, Mr. Tanaka said. About Toshiba Corp. Toshiba Corporation (TYO:6502) -- http://www.toshiba.co.jp/-- is a Japan-based manufacturer involved in five business segments. The Digital Products segment offers cellular phones, hard disc devices, optical disc devices, liquid crystal televisions, camera systems, digital versatile disc (DVD) players and recorders, personal computers (PCs) and business phones, among others. The Electronic Device segment provides general logic integrated circuits (ICs), optical semiconductors, power devices, large-scale integrated (LSI) circuits for image information systems and liquid crystal displays (LCDs), among others. The Social Infrastructure segment offers various generators, power distribution systems, water and sewer systems, transportation systems and station automation systems, among others. The Home Appliance segment offers refrigerators, drying machines, washing machines, cooking utensils, cleaners and lighting equipment. The Others segment leases and sells real estate. ==================== N E W Z E A L A N D ==================== DOMINION FINANCE: Three Directors Plead Guilty ---------------------------------------------- The New Zealand Herald reports that three Dominion Finance directors -- including two well-known members of the business community -- have pleaded guilty and been convicted of making untrue statements in offer documents. The Herald says the men are the last of the Dominion Finance directors to go through the court system and were due to go to trial early next month. According the report, Dominion Finance and North South Finance directors Rick Bettle and Vance Arkinstall pleaded guilty to five Securities Act charges for signing offer documents that contained untrue statements. Another director Paul Forsyth pleaded guilty to seven Securities Act charges on June 26. Messrs. Bettle and Arkinstall were originally facing all seven charges but the Financial Markets Authority -- which is bringing the case against the men -- is no longer pursuing two of those. The report says the men admitted the charges, which related to the finance companies' prospectuses and advertisements, in the High Court at Auckland on Wednesday before Justice Sarah Katz. Six of the failed companies' directors were originally facing charges but one has died and two others earlier pleaded guilty, the Herald notes. Messrs. Bettle, Arkinstall and Forsyth are due to be sentenced on August 16 and the men were remanded at large on Wednesday, according to the Herald. Justice Katz ordered a pre-sentence report with a home-detention appendix be prepared for all three men, the report adds. About Dominion Finance Based in Auckland, New Zealand, Dominion Finance Holdings Limited was engaged in the provision of financial services through the raising of debenture stock. The company operated through its wholly owned subsidiaries Dominion Finance Group Limited and North South Finance Limited, and investment vehicle Dominion Investment Fund Limited. Both Dominion Finance Group Limited and North South Finance Limited accepted debenture stock investments and apply them (in conjunction with its own funds) towards the provision of certain loans and other financial accommodation. Dominion Finance Group was put into receivership in September 2008 owing about NZ$176.9 million to more than 5,900 investors. It was put into liquidation by the High Court at Auckland in May 2009. Associate Judge Faire appointed William Black and Andrew Grenfell of McGrathNicol as liquidators of the firm. Receiver Rod Partington of Deloitte said the liquidation application will not affect the progress of the receivership. North South Finance went into receivership in July 2010. In total, the group is estimated to owe creditors NZ$400 million. FIVE STAR: Williams Launders Toxic Loans, Says Court ---------------------------------------------------- The New Zealand Herald reports that Five Star founder Neill Williams planned and carried out a complex scheme to launder "toxic" related-party loans culminating in a transaction that was "as uncommercial as can be imagined", the High Court heard Monday. The Herald relates that the elderly accountant -- who has been declared bankrupt twice since age 60 -- was sentenced to three years, seven months in jail earlier this year in a Financial Markets Authority case. According to the report, Mr. Williams' trial on separate charges brought by the Serious Fraud Office began in the High Court at Auckland on June 24, where the accused pleaded not guilty to two counts of theft by a person in a special relationship and five of dishonesty using a document. The charges related to alleged offending between mid-2003 and 2007 at Five Star Consumer Finance, one of the companies in the collapsed Five Star Group, the Herald says. The Herald notes that Crown lawyer Brian Dickey said one of the theft charges related to a "complex matrix of interrelated and interdependent transactions" from March 2007. It involved Antares Finance Holdings (another company in the Five Star Group) purchasing all the shares of FSCF from Five Star Finance, which was previously its parent company. According to the Herald, the Crown lawyer said the transactions were designed to direct FSCF investor funds into FSF and "cleaned out" substantial related-party lending, some of which gave rise to the other theft charge Mr. Williams is facing. Five Star's related-parted balance was growing, which Mr. Dickey said was a problem for Mr. Williams and the group's listed directors, the report adds. About Five Star Finance Established in 1992, Five Star Finance Limited focused on financing real estate loans following a restructuring exercise that created Five Star Consumer Finance in New Zealand and Five Star Consumer Finance Pty in Australia. Five Star Debenture Nominee Limited acted as debenture holder on behalf of unsecured depositors and appeared to lend all of the money it raised to Five Star Finance. Five Star Finance Limited went into receivership on September 5, 2007. Five Star Debenture Nominee Limited went into liquidation on November 5, 2007. At the start of the liquidation in June 2009, the shortfall of assets to liabilities was NZ$51.7 million, according to The Dominion Post. The Post says joint liquidator Paul Sargison, of Gerry Rea & Associates, said the firm's directors attributed the group's failure to the economic crisis but his own appraisal is that Five Star has been insolvent since no later than March 31, 2005. ********* 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 ***