/raid1/www/Hosts/bankrupt/TCRAP_Public/140306.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, March 6, 2014, Vol. 17, No. 46
Headlines
A U S T R A L I A
3PL (AUS): Hills Corporate Appointed as Administrators
BRANDSCREEN PTY: Zenovia Purchases Firm Out of Administration
ENERGY MAINTENANCE: Creditors' Meeting Slated For March 12
FREELANCE GLOBAL: Cor Cordis Appointed as Administrators
HARRIS & NOONAN: Owes About AUD1.86 Million to Creditors
INTERMIC GROUP: Hayes Advisory Appointed as Administrators
PERPETUAL TRUSTEE: Moody's Rates AUD16.14MM Class E Notes 'Ba2'
QANTAS AIRWAYS: Urges Government For Qantas Sale Act Removal
SCAPE SHAPES: PricewaterhouseCoopers Appointed as Administrators
C H I N A
* China Faces Test With Potential Corporate Bond Default
I N D I A
ALLOYTECH: CRISIL Reaffirms 'B+' Rating on INR90MM Loans
AMETHYST HOSPITALITY: CRISIL Rates INR45MM Term Loan at 'B+'
ARCON PROJECT: CRISIL Reaffirms 'B+' Rating on INR35.5MM Loan
CHENNAI MICRO: CRISIL Assigns 'B-' Rating to INR200MM Loans
CORE GREEN: ICRA Lowers Rating on INR367.33cr Loans to 'D'
DARJEELING POWER: ICRA Revises Rating on INR25cr Loans to 'B+'
DEWA PROJECTS: CRISIL Reaffirms 'D' Rating on INR2.87BB Loan
DHANALAXMI COTTON: CRISIL Assigns 'B' Rating to INR80MM Loans
DILIGENT PINKCITY: ICRA Assigns 'B+' Rating to INR104.8cr Loans
EMC SUPER: CRISIL Reaffirms 'D' Rating on INR150MM Loans
GHUBAYA EDUCATIONAL: CRISIL Rates INR99.1MM Term Loan at 'D'
GOLD MUSEUM: CRISIL Assigns 'D' Rating to INR60MM Cash Credit
GURU AASHISH: CRISIL Lowers Rating on INR800MM Loans to 'D'
HARE KRISHNA: CRISIL Assigns 'B+' Rating to INR180MM Loans
HARSO STEELS: CRISIL Reaffirms 'B+' Rating on INR175MM Loans
HEENA ENTERPRISES: CRISIL Assigns 'B' Rating to INR190MM Loans
J M MHATRE: CRISIL Assigns 'B' Rating to INR150MM Bank Loan
JAJOO ENTERPRISES: CRISIL Cuts Rating on INR450MM Loans to 'D'
JODHPUR HEALTH: CRISIL Assigns 'B' Rating to INR415MM Loans
MAHAVIR RICE: CRISIL Ups Rating on INR10MM Cash Credit to 'B+'
NAGPAL WAREHOUSE: CRISIL Rates INR60MM Term Loan at 'B+'
NANU RAM: ICRA Reaffirms 'B+' Rating on INR6cr Crash Credit
PRAHLADRAI FABRICS: CRISIL Cuts Ratings on INR950MM Loans to 'D'
PRINCES BUILDTECH: ICRA Reaffirms 'B+' Rating on INR15cr Loans
RISHI TRADERS: CRISIL Rates INR80MM Cash Credit at 'B+'
RUDRESH EDUCATION: ICRA Suspends B+ Rating on INR7.5cr Loans
S. V. BANDI: CRISIL Assigns 'B+' Rating to INR30MM Loan
SAHYADRI HEALTHCARE: CRISIL Rates INR125.5MM Term Loan at 'B+'
SATYA MEGHA: CRISIL Reaffirms 'D' Rating on INR372MM Loans
SHIVAM COTEX: CRISIL Assigns 'B+' Rating to INR200MM Loans
SHREE ADEISHWAR: CRISIL Assigns 'B' Rating to INR100MM Loan
SHRI GIRIRAJ: CRISIL Assigns 'B' Rating to INR100MM Loan
SHRI SANTKRUPA: CRISIL Upgrades Rating on INR70MM Loans to 'B-'
SHUBHYAN MOTORS: CRISIL Lowers Rating on INR20MM Loans to 'B'
SWASTIK MARKETING: ICRA Assigns 'B+' Rating to INR2.50cr Loan
T.J.S. ENGINEERING: CRISIL Raises Rating on INR90MM Loan to B+
TRENDY WHEELS: CRISIL Reaffirms 'B+' Rating on INR60MM Loans
VHV BEVERAGES: CRISIL Assigns 'B' Rating to INR170.7MM Loans
VIRAJ ALCOHOL: CRISIL Assigns 'B+' Rating to INR220MM Loans
VRUNDAVAN GINNING: CRISIL Cuts Rating on INR100MM Loans to 'B'
I N D O N E S I A
INDOSAT TBK: 2013 Results Within Moody's Ba1 Rating Expectations
MULTIPOLAR TBK: Fitch Assigns 'B+' Rating to US$30MM 9.75% Notes
J A P A N
MT. GOX: Mizuho Pushed to End Dealings with Bitcoin Exchange
MT. GOX: Plaintiffs in Class Suit Seek to Freeze U.S. Assets
* Japan's Financial Watchdog Considers Regulating Bitcoin
* JAPAN: Mulls Bitcoin Tax Following Mt Gox Collapse
S R I L A N K A
MULTI FINANCE: Fitch Withdraws 'B-' Rating with Watch Negative
- - - - -
=================
A U S T R A L I A
=================
3PL (AUS): Hills Corporate Appointed as Administrators
------------------------------------------------------
Grahame Peter Hill -- grahame@hillscorporate.com.au -- at Hills
Corporate Services Pty Ltd was appointed as administrators of 3PL
(Aus) Pty Ltd on March 3, 2014.
A first meeting of the creditors of the Company will be held at
Suite M2 135 Victoria Road, in Drummoyne, New South Wales, on
March 13, 2014, at 10:00 a.m.
BRANDSCREEN PTY: Zenovia Purchases Firm Out of Administration
-------------------------------------------------------------
Cliff Sanderson at dissolve.com.au reports that Brandscreen Pty
Ltd has been purchased out of administration by Zenovia Exchange.
According to dissolve.com.au, Zenovia CTO and founder Dwight
Ringdahl said the acquisition provides them a better Asian and
Australian market platform as well as a premium technology
offering.
It has been cited that the name of Brandscreen will be kept,
dissolve.com.au relates. Mr. Ringdahl cited the purchase aims to
build Brandscreen offices back up to their original state,
dissolve.com.au relays. Reports said that executives of Zenovia
are already at Brandscreen's offices in Sydney to start with the
integrated offering work, dissolve.com.au adds.
Brandscreen provides services to a number of clients located
throughout the Asia Pacific region.
Brandscreen called in administrators Roderick Mackay Sutherland
and Sule Arnautovic of Jirsch Sutherland in December 2013 as the
Australian based company's founders failed to find a buyer of the
business.
ENERGY MAINTENANCE: Creditors' Meeting Slated For March 12
----------------------------------------------------------
Benjamin Michael Johnson -- Ben.M.Johnson@fh.com.au -- and Andrew
John Saker -- andrew.saker@fh.com.au -- at Ferrier Hodgson were
appointed as administrators of Energy Maintenance Partners Pty Ltd
on Feb. 11, 2014.
A first meeting of the creditors of the Company will be held at
the offices of Ferrier Hodgson, Level 28, 108 St Georges Terrace,
in Perth, on March 12, 2014, at 11:00 a.m.
FREELANCE GLOBAL: Cor Cordis Appointed as Administrators
--------------------------------------------------------
Daniel P. Juratowitch -- djuratowitch@corcordis.com.au -- and
Bruno A. Secatore -- bsecatore@corcordis.com.au -- at Cor Cordis
Chartered Accountants were appointed as administrators of
Freelance Global Ltd on Feb. 28, 2014.
A first meeting of the creditors of the Company will be held at
The Law Institute of Victoria, Ground Floor, 470 Bourke Street, in
Melbourne, on March 13, 2014, at 10:00 a.m.
HARRIS & NOONAN: Owes About AUD1.86 Million to Creditors
--------------------------------------------------------
Harris & Noonan Pty Ltd's estimated debts to creditors totalled
approximately AUD1.86 million, liquidator Ferrier Hodgson said in
a report.
A meeting of creditors of Harris & Noonan was held in Adelaide on
March 4.
At the meeting, liquidator, Mr. Tim Mableson --
tim.mableson@fh.com.au -- a partner at corporate recovery firm
Ferrier Hodgson, delivered his preliminary report to creditors.
Creditors ratified the company's appointment of the voluntary
liquidators and no committee of inspection was formed.
In his report, Mr. Mableson estimated debts to creditors totalled
approximately AUD1.86 million, including AUD1.2 million owed to
trade creditors and AUD430,000 owed to the Australian Taxation
Office.
Employee entitlements of approximately AUD230,000 will be met
through the Federal Government's Fair Entitlements Guarantee
scheme.
Mr. Mableson reported it was still too early to determine the
return, if any, to unsecured creditors without further
investigation into the company's affairs.
He reported that the directors of Harris & Noonan claimed the
collapse of the company came about due to the significant losses
the company had incurred, including the Victoria Square Project,
which eroded the working capital available for the company's
pipeline of work.
Mr. Mableson said it is too early to assess the quantum of
realisations. "We need to conduct further enquiries and will
report to creditors regarding any return," Mr. Mableson said.
Harris & Noonan is engaged in landscaping business. The company
was placed into voluntary liquidation on Feb. 17, 2014. All 22
staff were made redundant at that time.
INTERMIC GROUP: Hayes Advisory Appointed as Administrators
----------------------------------------------------------
Alan Hayes -- ahayes@hayesadvisory.com.au -- and Christian
Sprowles -- csprowles@hayesadvisory.com.au -- at Hayes Advisory
were appointed as administrators of Intermic Group Pty Limited on
Feb. 28, 2014.
A first meeting of the creditors of the Company will be held at
Level 11, 66 King Street, in Sydney, on March 12, 2014, at
11:00 a.m.
PERPETUAL TRUSTEE: Moody's Rates AUD16.14MM Class E Notes 'Ba2'
---------------------------------------------------------------
Moody's Investors Service has assigned provisional ratings to
notes issued by Perpetual Trustee Company Limited in its capacity
as trustee of the SMART ABS Series 2014-1US Trust.
Issuer: SMART ABS Series 2014-1US Trust
USD 90.00 million Class A-1 Notes, Assigned (P)P-1 (sf);
USD 134.00 million Class A-2 Notes, Assigned (P)Aaa (sf);
USD 166.00 million Class A-3 Notes, Assigned (P)Aaa (sf);
USD 110.00 million Class A-4 Notes, Assigned (P)Aaa (sf);
AUD 9.69 million Class B Notes, Assigned (P)Aa3 (sf);
AUD 17.76 million Class C Notes, Assigned (P)A2 (sf);
AUD 17.76 million Class D Notes, Assigned (P)Baa3 (sf);
AUD 16.14 million Class E Notes, Assigned (P)Ba2 (sf).
The AUD 16.14 million Seller Notes are not rated by Moody's.
The Class A-1 Notes will be fixed rate notes. The Class A-2, Class
A-3 and Class A-4 Notes may be offered as either fixed or floating
rate notes. Where the Class A-2, Class A-3 and Class A-4 fixed and
floating rate Notes are offered, the notes will be issued as Class
A-2a, Class A-2b, Class A-3a, Class A-3b, Class A-4a and Class A-
4b respectively.
The transaction is a securitisation of a portfolio of Australian
novated leases, commercial hire purchase agreements, chattel
mortgages and finance leases secured by motor vehicles, originated
by Macquarie Leasing Pty Limited ("Macquarie"). This is
Macquarie's first ABS transaction issued in 2014.
Ratings Rationale
SMART ABS Series 2014-1US Trust replicates structures seen in
previous SMART transactions sponsored by Macquarie, and closely
follows the structure seen in other SMART ABS Series offered in
the US. Notable features of the transaction include the
conservative composition of the receivables pool backing the
transaction, the USD-denominated senior notes and the sequential
to pro-rata principal repayment profile.
The pool includes a high percentage of novated leases (63%), which
exhibit a lower level of risk than other contract types. At the
same time, the deal is exclusively backed by motor vehicles,
predominantly cars. Past non-US SMART transactions and other
Australian ABS transactions typically include 10-15% of other
equipment types. Motor vehicles exhibit less pro-cyclical default
patterns and, on average, higher recovery rates. As a result,
Moody's views the SMART ABS Series 2014-1US Trust pool as having
more positive collateral characteristics than peer portfolios.
In order to fund the purchase price of the portfolio, the Trust
will issue six classes of notes across up to twelve tranches. The
notes will be repaid on a sequential basis in the initial stages
(until the subordination percentage increases from the initial
12.0% to 18.9%, and from 13.0% to 19.9% including the liquidity
reserve) and once the transaction reaches the 10% pool factor. At
all other times, the structure will follow a pro rata repayment
profile. This principal paydown structure is comparable to other
structures in the Australian ABS market in recent years.
The deal will include a minimum of four (and up to seven in the
event both fixed and floating rate notes are issued) senior, USD-
denominated tranches. The Class A-1 Notes are fast-pay money-
market notes, rated P-1. The Class A Notes will be repaid
sequentially within the Class A Note allocation. The ratings are
based on the credit enhancement provided by the subordinated notes
and the liquidity reserve, in total equal to 13% for the Class A
Notes.
An unusual feature of this and previous USD-denominated SMART
transactions is that the maturity dates of the Class A Notes were
set not with reference to the maturity of the longest dated
receivable but rather with reference to the scheduled principal
amortisation profile (with a certain buffer to allow for defaults
and delinquencies). Moody's has accounted for the possibility of
losses and delinquencies during the term of the Class A notes in
its assessment of the likelihood of their repayment and believes
scheduled principal amortisation to be sufficient to repay the
Class A Notes by the maturity dates in full.
Moody's base case assumptions are a default rate of 1.90% and a
recovery rate of 40.00%. These rates imply an expected (net) loss
of 1.14%. Both the default rate and the recovery rate have been
stressed relative to extrapolated historical levels of 1.50%
(extrapolated) and 54.13% respectively.
The ratings address the expected loss posed to investors by the
legal final maturity. The structure allows for timely payment of
interest and ultimate payment of principal by the legal final
maturity.
Methodology Underlying the Rating Action:
The principal methodology used in this rating was "Moody's
Approach to Rating Auto Loan-Backed ABS" published in May 2013.
Factors That Would Lead to an Upgrade or Downgrade of the Rating
Levels of credit protection that are greater than necessary to
protect investors against current expectations of loss could lead
to an upgrade of the rating. Moody's current expectations of loss
could be better than its original expectations because of fewer
defaults by underlying obligors or higher recoveries on defaulted
loans. The Australian job market and the market for used vehicles
are primary drivers of performance.
Levels of credit protection that are insufficient to protect
investors against current expectations of loss could lead to a
downgrade of the ratings. Moody's current expectations of loss
could be worse than its original expectations because of more
defaults by underlying obligors or lower recoveries on defaulted
loans. The Australian job market and the market for used vehicles
are primary drivers of performance. Other reasons for worse
performance than Moody's expects include poor servicing, error on
the part of transaction parties, a deterioration in credit quality
of transaction counterparties, lack of transactional governance
and fraud.
Moody's Parameter Sensitivities:
If the default rate rises to 3.80% (double Moody's assumption of
1.90%) and recovery rates are reduced to 20% (half Moody's
assumption of 40%) then the model-indicated rating for the Class
A4 Notes and Class B Notes both drop seven notches to Baa1 and Ba1
respectively.
QANTAS AIRWAYS: Urges Government For Qantas Sale Act Removal
------------------------------------------------------------
Qantas Airways has argued for the removal of the Qantas Sale Act
constraints for more than a decade. "We believe the Act is
outdated and puts Qantas at a unique disadvantage over its
competition," the national carrier said in a statement on
March 5.
"Both sides of politics have fully accepted that the Australian
aviation playing field is distorted.
"After extensive discussions with Qantas, the Government announced
that it had deliberated carefully on various options, and that its
preferred course of action is to ask the Parliament to repeal key
provisions of the Qantas Sale Act.
"If the legislation does not pass, then the domestic distortion
would remain.
"Qantas will now focus on what we can control, and that's
operating a great Australian business. We will continue to work
through the processes announced last week to take $2 billion in
costs out of our business.
"We have said that the price on carbon is a cost to our business
that we have not been able to recover through fare increases,
because of the intensely competitive market we operate in.
Domestically, it cost us $106 million in FY13 and $59 million in
HY14. It is among the significant challenges we face, including an
uneven playing field, capacity increases in the international
market and record high fuel prices.
"Our aim is always this: to preserve the future of Australia's
Qantas. Now more than ever we must look after our customers, stay
focused, and maintain the highest standards in all that we do."
Jared Owens at The Australian says the statement undermines
repeated claims by the Labor Party that the carbon tax is "not a
significant issue" for the airline, but also contradicts a Qantas
spokesman who last week said: "Qantas's current issues are not
related to carbon pricing."
It comes after the Abbott government refused Qantas's request for
a debt guarantee or loan, but moved to relax foreign ownership
limits on the embattled airline -- a plan that faces opposition in
the Senate, according to The Australian.
As reported in the Troubled Company Reporter-Asia Pacific on
Feb. 27, 2014, The Wall Street Journal said Qantas would cut 5,000
jobs, sell airport terminal leases, and defer aircraft deliveries
as intense competition sent it to a deep loss in the fiscal first-
half. According to the report, the Australian flag carrier also
said it would scrap routes, including flights between Perth and
Singapore, and suspend new growth at the Asian arm of low-cost
offshoot Jetstar.
Qantas booked a net loss for the six months through December of
235 million Australian dollars (US$211 million), compared with a
AUD109 million profit in the same period a year earlier, the
Journal related.
About Qantas Airways
Headquartered in Sydney, Australia, Qantas Airways Limited --
http://www.qantas.com.au/-- is an Australian airline company
engaged in the operation of international and domestic air
transportation services, and the provision of time definite
freight services. Qantas is also engaged in the sale of
international and domestic holiday tours, and associated support
activities, including flight training, catering, passenger and
ground handling, and engineering and maintenance. It is
organized into four segments: Qantas, Jetstar, Qantas Holidays
and Qantas Flight Catering.
As reported in the Troubled Company Reporter-Asia Pacific on
March 3, 2014, Moody's Investors Service said Qantas Airways
Limited's half year results to Dec. 30, 2013, are credit negative
though broadly within expectation and have no immediate impact on
its Ba1 corporate family rating, Ba2 senior unsecured long term
rating or non-prime (NP) short term rating. The outlook for
Qantas' ratings remains negative.
SCAPE SHAPES: PricewaterhouseCoopers Appointed as Administrators
----------------------------------------------------------------
Derrick Craig Vickers and Darryl Edward Kirk at
PricewaterhouseCoopers were appointed as administrators of Scape
Shapes Landscaping Pty Ltd on March 3, 2014.
A first meeting of the creditors of the Company will be held at
Christie Conference Centre, 320 Adelaide Street, in Brisbane, on
March 12, 2014, at 10:00 a.m.
=========
C H I N A
=========
* China Faces Test With Potential Corporate Bond Default
--------------------------------------------------------
Lingling Wei, writing for The Wall Street Journal, reported that
the first potential default in China's fast-growing corporate bond
market offers a test of whether Beijing will allow a long-taboo
practice as it seeks to rein in runaway credit: corporate
failures.
A deeply indebted Shanghai solar-equipment maker warned that it
won't be able to meet interest payments totaling CNY89.8 million
($14.7 million) due on March 7 on a bond sold two years ago,
citing a cash squeeze and its inability to raise enough funds in
time, the report recalled.
The potential default by Shanghai Chaori Solar Energy Science &
Technology Co., though small, would mark the first time a Chinese
company has defaulted on a bond traded in the mainland, the report
said, citing Moody's Investors Service.
So far, the Chinese government and state-owned banks have largely
kept risky borrowers afloat by providing bailouts or debt
extensions, keeping borrowing costs low for companies with high
debt, the report added. That has led many investors to flock to
Chinese corporate bonds on the belief they have an implicit
guarantee, helping to fuel growth.
Total corporate bonds outstanding rose more than tenfold to CNY8.7
trillion at the end of January from the end of 2007, allowing even
weak borrowers to tap funds at relatively low rates, the report
noted.
=========
I N D I A
=========
ALLOYTECH: CRISIL Reaffirms 'B+' Rating on INR90MM Loans
--------------------------------------------------------
CRISIL's rating on the long-term bank facilities of Alloytech
continues to reflect AT's below-average financial risk profile,
marked by a high gearing driven by large working capital
requirements, and the firm's small scale of operations and
susceptibility to volatility in raw material prices. These rating
weaknesses are partially offset by the benefit that the firm
derives from the experience of, and fund support from, its
partners in the aluminium industry.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Cash Credit 65 CRISIL B+/Stable (Reaffirmed)
Proposed Cash
Credit Limit 25 CRISIL B+/Stable (Reaffirmed)
Outlook: Stable
CRISIL believes that AT will continue to benefit over the medium
term from its partners' extensive industry experience. CRISIL,
however, believes that AT's financial risk profile will remain
weak during this period because of the firm's small net worth. The
outlook may be revised to 'Positive' in case AT significantly
improves its capital structure or records more-than-expected
improvement in its revenues. Conversely, the outlook may be
revised to 'Negative' in case AT's working capital cycle
lengthens, or there is a deterioration in its debt protection
metrics or operating margin.
Update
AT's revenue remained stagnant at INR478 million in 2012-13
(refers to financial year, April 1 to March 31) on account of
sluggish demand and intense competition in the highly fragmented
industry. At about 5 per cent in 2012-13, the operating margin
remains vulnerable to price of aluminium scrap, and is constrained
by the firm's limited pricing power. CRISIL believes that AT's
revenue will continue to be constrained by competition, and its
profitability will remain susceptible to fluctuations in raw
material prices.
AT's financial risk profile has been constrained by small net
worth of INR30 million and high gearing of 4.2 times as on
March 31, 2013. The liquidity continues to remain stretched on
account of low accruals of about INR6 million in 2012-13 and
moderate working capital intensity in operations reflected in
gross current assets of 123 days as on March 31, 2013. Due to
substantial reliance on bank lines to meet the incremental working
capital requirements, the average bank limit utilisation was high
at more than 90 per cent. CRISIL believes that a controlled
working capital cycle and continued fund support from the
promoters will be crucial for improving the firm's liquidity.
For 2012-13, AT reported a profit after tax (PAT) of INR3.4
million on net sales of INR478 million, against a PAT of INR9.7
million on net sales of INR488 million for 2011-12.
AT was set up in 1996 by Mr. G Shivakumar and M. Gopal in
Bengaluru (Karnataka). It manufactures aluminium alloys using
imported aluminium scrap. Bosch India Ltd is one of the key
customers of the firm.
AMETHYST HOSPITALITY: CRISIL Rates INR45MM Term Loan at 'B+'
------------------------------------------------------------
CRISIL has assigned its 'CRISIL B+/Stable' rating to the long-term
bank facilities of Amethyst Hospitality Pvt Ltd.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Long Term Loan 45 CRISIL B+/Stable
The rating reflects AHPL's start up nature of operations and
exposure to cyclicality and intense competition in the hospitality
industry. These rating weaknesses are partially offset by the
favorable location of the project and need-based funding support
from the promoters.
Outlook: Stable
CRISIL believes that AHPL will continue to benefit over the medium
term from the funding support from its promoters. The outlook may
be revised to 'Positive' if the company records more-than-expected
increase in its revenues and profitability on account of higher
occupancy levels and better average room rates (ARR), resulting in
an improvement in its financial risk profile. Conversely, the
outlook may be revised to 'Negative' if AHPL undertakes any
larger-than-expected, debt-funded capital expenditure programme,
or generates lower-than-expected cash accruals because of low
occupancy levels or ARR.
AHPL, incorporated in 2007, owns a three-star hotel in Bengaluru
(Karnataka). It is part of the Davanam group of companies which
has interest in jewellery and real estate business, among others.
The hotel is expected to be fully operational from March 2014.
For 2012-13 (refers to financial year, April 1 to March 31), AHPL
reported a loss of INR57.2 million on total revenues of INR49.6
million.
ARCON PROJECT: CRISIL Reaffirms 'B+' Rating on INR35.5MM Loan
-------------------------------------------------------------
CRISIL's ratings on the bank facilities of Arcon Project Pvt Ltd
continues to reflect APPL's small scale of operations, with
limited track record in civil construction, and exposure to risk
related to timely completion, funding and salability of its real
estate project. These rating weaknesses are partially offset by
APPL's healthy order book position, providing revenue visibility
over the medium term.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Bank Guarantee 79.5 CRISIL A4 (Reaffirmed)
Cash Credit 35.5 CRISIL B+/Stable (Reaffirmed)
Outlook: Stable
CRISIL believes that APPL will maintain its business risk profile,
backed by its healthy order book position for civil construction
business, providing revenue visibility over the medium term. The
outlook may be revised to 'Positive' if the company strengthens
its business profile through improvement in its scale of
operations from civil construction business, or through greater
customer diversity, or in case of better-than-expected booking of
its real estate project and receipt of customer advances, leading
to more-than-expected cash inflows. The outlook may also be
revised 'Positive' in case of improvement in financial risk
profile, particularly liquidity, through better-than-expected
accruals or infusion of capital by promoters or efficient
management of working capital. Conversely, lower-than-expected
accruals or stretch in working capital or delays in receipt of
customer advances or any significant debt-funded capital
expenditure plans, leading to deterioration in the company's
financial risk profile, particularly its liquidity, may lead to a
revision in the outlook to 'Negative'
APPL was incorporated in 2011 by Patna-based Mr. Arjun Singh and
Mr. Durga Pratap Singh to undertake civil construction and
infrastructural development work such as development of power
plant infrastructure and construction of buildings and bridges.
The company is also developing a residential-cum-commercial mall
in Muzaffarpur, Bihar
CHENNAI MICRO: CRISIL Assigns 'B-' Rating to INR200MM Loans
-----------------------------------------------------------
CRISIL has revoked the suspension of its rating on the long-term
bank facilities Chennai Micro Print Private Limited and has
assigned its 'CRISIL B-/Stable' rating to the facilities. CRISIL
had, on January 28, 2013, suspended the rating as CMPL had not
provided necessary information required to maintain a valid
rating. CMPL has now shared the requisite information, enabling
CRISIL to assign a rating to the bank facilities.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Cash Credit 115 CRISIL B-/Stable (Assigned;
Suspension revoked)
Long Term Loan 5.7 CRISIL B-/Stable (Assigned;
Suspension revoked)
Proposed Long Term 79.3 CRISIL B-/Stable (Assigned;
Bank Loan Facility Suspension revoked)
The rating reflects CMPL's modest scale of operations in an
intensely competitive and fragmented printing and packaging
industry, geographical concentration in revenue profile, and
average financial risk profile marked by modest net worth. These
rating weaknesses are partially offset by the promoters' long-
standing industry experience.
Outlook: Stable
CRISIL believes that CMPL will continue to benefit from its
promoters' long-standing industry experience over the medium term.
The outlook may be revised to 'Positive' if the company's credit
risk profile significantly improves on the back of better-than-
expected cash accruals along with efficient working capital
management. Conversely, the outlook may be revised to 'Negative'
in the event of further pressure on CMPL's liquidity profile owing
to lower-than-expected cash accruals, or larger-than-expected
working capital requirements or debt-funded capex.
Established in 1999, CMPL prints books and magazines. It also
manufactures printed duplex cartons.
CMPL reported a profit after tax (PAT) of INR13.3 million on an
operating income of INR565.5 million for 2012-13 (refers to
financial year, April 1 to March 31), as against a PAT of INR10.6
million on an operating income of INR510.0 million for 2011-12.
CORE GREEN: ICRA Lowers Rating on INR367.33cr Loans to 'D'
----------------------------------------------------------
ICRA has revised the long term rating of Core Green Sugar & Fuels
Private Limited to [ICRA]D from [ICRA]BB for INR224.21 crore
(reduced from INR248.77 crore) term loans, INR118.46 crore
(enhanced from INR78.06 crore) cash credit facilities and INR0.12
crore (earlier nil) unallocated limits. ICRA has also revised the
short term rating of CGSFPL to [ICRA]D from [ICRA]A4 for INR24.54
crore (reduced from INR26.00 crore) non fund based facilities.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Term Loan 224.21 [ICRA]D; revised from
[ICRA]BB (stable)
Cash Credit 118.46 [ICRA]D; revised from
[ICRA]BB (stable)
Non Fund Based
Limits 24.54 [ICRA]D; revised from
[ICRA]A4
Unallocated Limits 0.12 [ICRA]D; revised from
[ICRA]BB (stable)
The revision of ratings factors in the recent delays in servicing
of the debt obligations by the company owing to stretched
liquidity profile as reflected by high utilization of working
capital limits majorly due to high inventory of 287 days as on
March 31, 2013. The ratings are also constrained by the weak
financial profile profile of the company as characterized by
losses at net level, high gearing and weak coverage indicators in
FY13. Further, given that the high inventory of sugar as on
March 31, 2013 would be sold at low sugar realizations during
FY14, company is likely to report inventory losses thereby
adversely impacting the profitability in FY14.
While the company has large debt repayments going forward, the
profitability and coverage indicators are contingent on the cane
price for SY14 owing to low sugar realizations prevailing in the
market. The company's operations will also be subject to risks
that are associated with all sugar mills including agro-climatic
risks, cyclicality associated with sugar business and
vulnerability to government/regulatory actions associated with the
business as evident in restriction in terms of sugarcane pricing,
sugar exports, power sales and distillery products.
ICRA has however taken note of fully integrated nature of
operations of the company providing cushion to profitability to an
extent in case of sugar downturn, eligibility to long term low
cost SDF loans, limited off take risks associated with power in
Karnataka and favorable agro-climatic conditions in the catchment
area, including availability of well-irrigated arable land and
cane development activities undertaken by the company, which are
likely to result in healthy raw material availability in the long
run.
Going forward, the ability of the company to improve the liquidity
position; and timely service the debt obligations are the key
rating sensitivities.
Core Green Sugar and Fuels Private Limited has set up an
integrated sugar plant at Yadgir District of Karnataka which was
commissioned in April 2011. The plant has a 5000 TCD crushing
unit, 24 MW cogen unit and a 50 KLPD distillery units.
DARJEELING POWER: ICRA Revises Rating on INR25cr Loans to 'B+'
--------------------------------------------------------------
ICRA has revised the long term rating outstanding on the INR22.75
crore Term Loans, INR0.78 crore Fund based (Cash Credit) and
INR1.47 crore proposed bank facilities of Darjeeling Power Limited
from [ICRA]BB to [ICRA]B+.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Term Loans 22.75 [ICRA]B+ revised
Fund Based
(Cash Credit) 0.78 [ICRA]B+ revised
Proposed 1.47 [ICRA]B+ revised
The revision in rating takes into account the significant delays
in execution of the project, primarily on account of change in
evacuation system design, delays in receipt of certain approvals
and other execution related challenges. The delay in project
execution, with the project running 18 months behind schedule, has
significantly reduced the moratorium period for the project debt,
thereby exposing the company to refinancing risks.
The rating continues to remain constrained by the exposure to
hydrology risks given the unavailability of long term flow series
data at the project site as well as the high project gearing
(2.33:1) and consequent financial risk. The rating also factors in
the market risk with the power off-take agreement yet to be
signed; however the likely energy deficit status in northern India
in the foreseeable future provides comfort to some extent. The
rating favorably factors in the proven track record of the EPC
contractor and the project's eligibility for capital subsidy from
Ministry of New and Renewable Energy (MNRE) which is expected to
positively impact the project viability. Going forward, the
ability of the company to complete the project with minimal cost
and time overruns, meet the designed performance parameters and
receive funding support from the group in a timely manner remains
would be key rating sensitive factors.
Darjeeling Power Limited is a Special Purpose Vehicle (SPV)
incorporated to develop, own and operate a 3 MW small hydro power
(SHP) project known as Shaung Mini Hydropower Project (referred to
as Shaung Project). With the company utilizing equipment with 33%
overload capacity, the project capacity can effectively be taken
to 4 MW. The project is located in Kinnaur District of Himachal
Pradesh (HP). DPL was promoted by the Mumbai based Somani Group
which is engaged in education as well as hydro power having an
executed four projects in the past aggregating to 15.9 MW. The
company signed the Implementation Agreement (IA) with the
Government of Himachal Pradesh (GoHP) in June 2005 for carrying
out the project on "Build Own Operate & Transfer" (BOOT) basis for
a period of 40 years. The project is currently in advanced stages,
with the expected Commercial Operation Date (COD) of the project
to be in July 2014.
DEWA PROJECTS: CRISIL Reaffirms 'D' Rating on INR2.87BB Loan
------------------------------------------------------------
CRISIL's rating on the long-term bank loan facilities of
Dewa Projects Pvt Ltd continues to reflect its delays in servicing
debt, due to weak liquidity.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Term Loan 2,870 CRISIL D (Reaffirmed)
DPPL is also exposed to risks related to the completion and
saleability of its ongoing real estate residential project, Dewa
Pier 20, in Kochi (Kerala); and to cyclical demand in the Indian
real estate sector. However, the company benefits from the
experience of its promoters in the construction industry.
DPPL was established in April 2005. The company is constructing
residential apartments at Marine Drive, Kochi (Kerala). The total
project cost is expected to be over INR4.6 billion; the project is
in the early phase of construction. DPPL is promoted by Mr.
Venugopalan Nair, a Kuwait-based non-resident Indian.
DHANALAXMI COTTON: CRISIL Assigns 'B' Rating to INR80MM Loans
-------------------------------------------------------------
CRISIL has assigned its 'CRISIL B/Stable' rating to the long-term
bank facilities of Dhanalaxmi Cotton Industries.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Proposed Long Term
Bank Loan Facility 22.5 CRISIL B/Stable
Cash Credit 27.5 CRISIL B/Stable
Long Term Loan 30.0 CRISIL B/Stable
The rating reflects DCI's below-average financial risk profile,
marked by high gearing, and its small scale of operations in a
highly fragmented industry. These rating weaknesses are partially
offset by the extensive industry experience of DCI's promoters.
Outlook: Stable
CRISIL believes that DCI will continue to benefit over the medium
term from its promoter's extensive industry experience. The
outlook may be revised to 'Positive' if the firm's revenue and
profitability increase substantially or in case of significant
infusion of capital leading to improvement in its financial risk
profile. Conversely, the outlook may be revised to 'Negative' if
the firm undertakes aggressive debt-funded expansion, or if its
revenue and profitability decline substantially, or if the
promoters withdraw a large amount of capital from the firm leading
to deterioration in its financial risk profile.
Set up in January 2013, DCI is engaged in ginning and pressing of
raw cotton and sells cotton lint and cotton seeds. Based out of
Parakal village near Warangal and promoted by Mr.Yerra Harishankar
and his family, the firm commenced commercial operations from
November 2013.
DILIGENT PINKCITY: ICRA Assigns 'B+' Rating to INR104.8cr Loans
---------------------------------------------------------------
ICRA has assigned an '[ICRA]B+' rating to the Rs.104.80 crore fund
based facilities of Diligent Pinkcity Center Private Limited. ICRA
has also assigned an '[ICRA]A4' rating to the INR12.80 crore non
fund based facilities of DPCPL.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Fund Based Limits 104.80 [ICRA]B+ assigned
Non Fund Based
Limits 12.80 [ICRA]A4 assigned
The assigned ratings factor in the strong promoter set involving
some well established groups such as Dainik Bhaskar, Dangayach and
Derewala. This not only lends financial flexibility to the project
but also mitigates the implementation risk with adequate
experience of promoters in development of real estate projects and
hotels in the past.
The ratings also favorably factor in the low regulatory risks and
association with reputed architect and consultant team which
reduces the project execution risk to some extent. However, the
ratings are constrained on account of delays witnessed in project
implementation owing to issues such as delays in debt disbursement
and problems faced in acquiring land. Though company aims at
developing the Exhibition and Convention Center (Phase I) as per
initial timelines (by Aug 2014), there exists substantial
execution risk with the hotel (Phase II) being at the nascent
stage of development.
The assigned ratings also take into account its exposure to market
risk with the project's success depending on DPCPL's ability to
market it in the city, host industry events at the exhibition
center and generate adequate operating metrics for the hotel. ICRA
notes that the debt repayments are scheduled to begin from Dec
2014 and in the absence of adequate bookings for Exhibition and
Convention Center, the project could require funding support for
promoters for timely debt servicing. Further, any delay in project
implementation could also impact DPCPL's ability to meet debt
servicing obligations. Going forward, ability of the company to
complete the project within budgeted time and costs, and to
generate adequate cash flows from the Exhibition and Convention
Center and hotel once they become operational would constitute key
rating sensitivities.
Diligent Pinkcity Center Private Limited is a Jaipur based SPV
company promoted by Dainik Bhaskar Group., Dangayach group and
Derewala group. The company has been awarded the development of
the Exhibition and Convention Center at Sitapura, Jaipur under
Public Private Partnership format by the Rajasthan State
Industrial Development & Investment Corporation Limited. The
project is being developed in four phases with the first two
phases being implemented currently. As part of first phase
development, DPCPL is developing an Exhibition and Convention
Center as per the requirements set by RIICO while in the second
phase it would develop a 4-star hotel having 200 rooms. The
estimated cost of implementation of first two phases is INR168.80
crore which is being funded by INR104.80 crore debt and INR64
crore promoter's contribution/advances.
EMC SUPER: CRISIL Reaffirms 'D' Rating on INR150MM Loans
--------------------------------------------------------
CRISIL's rating on the long term bank facilities of EMC Super
Speciality Hospitals Pvt Ltd continue to reflect instances of
delays by EMC in servicing of its term debt. The delays have been
caused by the company's weak liquidity, marked by stretch in
receivables.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Cash Credit 50 CRISIL D (Reaffirmed)
Proposed Long Term
Bank Loan Facility 18.2 CRISIL D (Reaffirmed)
Term Loan 81.8 CRISIL D (Reaffirmed)
The rating also factors in EMC's average financial risk profile,
marked by high gearing and a small net worth, its modest scale of
operations and geographical concentration in its revenue profile.
These rating weaknesses are partially offset by the industry
experience of EMC's promoters.
Update
For 2012-13 (refers to financial year, April 1 to March 31), EMC
reported sales of INR244.8 million, a growth of around 20 per cent
year-on-year. The operating profitability also improved to 19 per
cent during the same period against 16.4 per cent during 2011-12.
During 2012-13, EMC signed contracts with insurance companies and
government departments under various schemes such as Ex-Servicemen
Contributory Health Scheme (ECHS) and Employee's State Insurance
(ESI) scheme, leading to improvement in its revenues and
profitability. For the nine months through December 2013, EMC's
revenues are estimated at INR210 million.
EMC's operations have remained working-capital-intensive as
reflected in its gross current asset (GCA) of 208 days as on March
31, 2013. The high GCA is primarily driven by stretch in
receivables from government departments as reflected in its
debtors of 149 days as on March 31, 2013. EMC's debt protection
metrics have remained average with interest coverage and net cash
accruals to total debt (NCATD) ratios at 2.5 times and 0.16 times
respectively for 2012-13. As on March 31, 2013, its gearing was
high 2.21 times and is expected to remain high over the medium
term because of its working-capital-intensive operations.
Furthermore, the financial risk profile remains constrained
because of its modest net worth of INR75.1 million as on March 31,
2013. The company's liquidity remains stretched with near-full
utilisation of its bank limits in order to manage its working
capital requirements.
For 2012-13, EMC reported a profit after tax (PAT) of INR10.2
million on net sales of INR244.8 million, against a PAT of INR3.8
million on net sales of INR202.8 million for 2011-12.
EMC was established as a partnership firm in 2003 by Mr. Pawan
Arora, Mrs Meenu Arora and Mr. Chaman Lal Arora in the name of
Emergency Medical Care Hospitals. The partnership firm was
reconstituted as a private limited company named as EMC in 2010.
The company operates a 235 bedded multi-specialty hospital in
Amritsar (Punjab).
GHUBAYA EDUCATIONAL: CRISIL Rates INR99.1MM Term Loan at 'D'
------------------------------------------------------------
CRISIL has assigned its 'CRISIL D' rating to the long-term bank
facilities of Ghubaya Educational Society.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Term Loan 99.1 CRISIL D
The rating reflects instances of delay by GES in servicing its
debt; the delays have been caused by the society's weak liquidity
arising out of depressed cash accruals on account of initial
stages of operations and delay in receipt of funds from the
government.
GES also has a weak financial risk profile, marked large debt-
funded capital expenditure and expected small scale of operations
due to limited intake capacity. The society, however, benefits
from the healthy demand prospects in the higher education industry
and funding support from promoters.
GES was set up in 2008 by Mr. Sher Singh Ghubaya and his family.
The society is managed by its chairman, Ms. Krishna Rani, and
general secretary, Mr. Virendra Singh (son of Mr. Sher Singh
Ghubaya). The society has set up an engineering institute named
the Ghubaya College of Engineering & Technology (GCET), at Sukhera
Bodla of Jalalabad in Fazilka (Punjab). Besides engineering
courses, the college has started conducting science courses
(except Biology) for Classes 11 and 12 (Maths, Physics and
Chemistry), and a diploma courses in Mechanical and Computer
Science.
GOLD MUSEUM: CRISIL Assigns 'D' Rating to INR60MM Cash Credit
-------------------------------------------------------------
CRISIL has assigned its 'CRISIL D' rating to the long-term bank
facility of Gold Museum Jewellers Pvt Ltd. The rating reflects
instances of delay by GMJPL in servicing its debt; the delays have
been caused by the company's weak liquidity.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Cash Credit 60 CRISIL D
GMJPL also has a weak financial risk profile, marked by a small
net worth, high gearing and subdued debt protection metrics, its
modest scale of operations in the highly fragmented retail
jewellery business and working-capital-intensive operations. These
rating weaknesses are partially offset by the extensive experience
of GMJPL's promoters in the jewellery business.
GMJPL, based in Kolhapur (Maharashtra) was promoted by Mr. Raju
Ismail Beg in 2010. It started commercial operations in February
2011. GMJPL retails in gold, diamond, silver and platinum
jewellery through its outlet in Kolhapur.
For 2012-13 (refers to financial year, April 1 to March 31), GMJPL
reported a profit after tax (PAT) of INR3.6 million on net sales
of INR311.9 million, against a PAT of INR3.5 million on net sales
of INR321.1 million.
GURU AASHISH: CRISIL Lowers Rating on INR800MM Loans to 'D'
-----------------------------------------------------------
CRISIL has downgraded its rating on the long-term bank facilities
of Guru Aashish Texfab Ltd (GATL; part of the Jajoo group) to
'CRISIL D' from 'CRISIL BB+/Stable'. The rating downgrade reflects
the Jajoo group's prolonged over-utilisation of its working
capital limits. This was caused by delay in realisation of
receivables from customers.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Cash Credit 550 CRISIL D (Downgraded from
'CRISIL BB+/Stable')
Proposed Long Term 250 CRISIL D Downgraded from
Bank Loan Facility 'CRISIL BB+/Stable')
The Jajoo group also has a below-average financial risk profile,
and low profitability, and is exposed to intense competition in
the fabrics trading industry. The group, however, benefits from
the extensive industry experience of its promoters, its
established relationships with various suppliers, and its asset-
light business model.
For arriving at its rating, CRISIL has combined the business and
financial risk profiles of GATL, Jajoo Enterprises Ltd, and
Prahladrai Fabrics Ltd. This is because these three companies,
together referred to as the Jajoo group, are engaged in similar
lines of business and have common promoters. Besides, JEL and GATL
have extended corporate guarantees to each other.
GATL was set up by Mr. Kamal Jajoo in Mumbai in 2003. GATL is a
closely held public limited company trading in fashion fabrics
primarily used in garments for youth and children. The company is
a part of the Jajoo group, which was established by Mr. Prahladrai
Jajoo (grandfather of Mr. Kamal Jajoo) in Gwalior (Madhya
Pradesh), in 1951. The other key group companies include PFL
(incorporated in 1992) and JEL (incorporated in 2000), which trade
in fabrics used for making shirts and suits.
The Jajoo group, on a provisional basis, reported a profit after
tax (PAT) of INR56.8 million on net sales of around INR8.79
billion for 2012-13 (refers to financial year, April 1 to
March 31); it had reported a PAT of INR54.84 million on net sales
of INR9.62 billion for 2011-12.
HARE KRISHNA: CRISIL Assigns 'B+' Rating to INR180MM Loans
----------------------------------------------------------
CRISIL has assigned its 'CRISIL B+/Stable' rating to the long-term
bank facilities of Hare Krishna Jewellery House Pvt Ltd.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Cash Credit 52.5 CRISIL B+/Stable
Proposed Long Term
Bank Loan Facility 127.5 CRISIL B+/Stable
The rating reflects HKJHPL's small scale of operations in the
competitive gems and jewellery industry. The rating also factors
in the company's average financial risk profile, marked by high
gearing and large working capital requirements. These rating
weaknesses are partially offset by the promoter's extensive
industry experience.
Outlook: Stable
CRISIL believes that HKJHPL will benefit from the extensive
industry experience of its promoters in the gold and diamond
jewellery retail and wholesale segments. The outlook may be
revised to 'Positive' if HKJHPL generates sizeable cash accruals,
with a significant improvement in its scale of operations and
hence, in its financial risk profile. Conversely, the outlook may
be revised to 'Negative' if the company's capital structure and
consequently, its financial risk profile deteriorate, due to
incremental working capital requirements; or if the company
undertakes any debt-funded capex plans.
HKJHPL is promoted by Mr. Santosh Kumar Agarwal and his son, Mr.
Chetan Agarwal. The company retails gold jewellery, diamond
jewellery, silver jewellery and precious stones through its
showroom in Ardali Bazaar, Varanasi (Uttar Pradesh).
HKJHPL reported a profit after tax (PAT) of INR2.9 million on net
sales of INR244.1 million for 2012-13 (refers to financial year,
April 1 to March 31), vis-a-vis a PAT of INR0.4 million on net
sales of INR0.5 million for 2011-12.
HARSO STEELS: CRISIL Reaffirms 'B+' Rating on INR175MM Loans
------------------------------------------------------------
CRISIL's ratings on the bank facilities of Harso Steels Pvt Ltd
continue to reflect its weak financial risk profile, marked by
high gearing and weak debt protection metrics, large working
capital requirements, and small scale of operations in the
intensely competitive pipes industry. These rating weaknesses are
partially offset by the benefits that HSPL derives from its
promoters' extensive experience in the pipes industry.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Cash Credit 150 CRISIL B+/Stable (Reaffirmed)
Letter of Credit 50 CRISIL A4 (Reaffirmed)
Term Bank Loan
Facility 25 CRISIL B+/Stable (Reaffirmed)
Outlook: Stable
CRISIL believes that HSPL will benefit over the medium term from
its promoters' extensive experience in the pipes industry and
established relationships with its customers and suppliers. The
outlook may be revised to 'Positive' if the company significantly
increases its scale of operations while maintaining its
profitability or improves its working capital management.
Conversely, the outlook may be revised to 'Negative' if less-than-
expected revenues, deterioration in its operating margin, or large
debt-funded capital expenditure programme causes its debt
protection metrics to weaken. Likewise, a further stretch in
working capital requirements, leading to deterioration in
liquidity profile could trigger an outlook revision to 'Negative'.
Update
HSPL has maintained its business risk profile with an operating
income of INR523.5 million in 2012-13 (refers to financial year,
April 1 to March 31), marginally lower than CRISIL's expectations
of around INR560 million; however, its operating margin of 4.9 per
cent in 2012-13 was in line with CRISIL's expectations. The
company's net cash accruals marginally improved to around INR5.6
million in 2012-13 from around INR5 million in 2011-12. The
business risk profile is expected to remain stable across the
medium term on account of diversified customer base, consisting of
Elite Tubes Pvt Ltd, Fabrigo, R S Enterprises, and others. HSPL's
operations have remained working capital intensive, marked by
gross current asset (GCA) days of 158 as on March 31, 2013, in
line with CRISIL's expectations and previous year's trend.
HSPL's capital structure has remained aggressive over 2012-13,
with gearing of 2.15 as on March 31, 2013, on account of low
accruals and working capital intensive operations being funded
primarily through bank borrowings. The company has weak debt
protection metrics, with interest coverage ratio of 1.32 times and
net cash accruals to total debt (NCATD) ratio of 0.04 times as on
March 31, 2013; these are expected to remain at a similar level
given its high dependency on bank borrowings for its working
capital requirements.
HSPL, incorporated in 1986 and promoted by the late Mr. Harbans
Lal Bansal, manufactures mild steel black pipes, steel structural
tubes, PVC (olyvinyl chloride) pipes, and PPR (polypropylene
random co-polymer pipe) fittings. HSPL is managed by Mr. Rakesh
Bansal (son of Mr. Harbans Lal Bansal).
HEENA ENTERPRISES: CRISIL Assigns 'B' Rating to INR190MM Loans
--------------------------------------------------------------
CRISIL has assigned its 'CRISIL B/Stable' ratings to the bank
facilities of Heena Enterprises.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Proposed Long Term
Bank Loan Facility 30 CRISIL B/Stable
Cash Credit 120 CRISIL B/Stable
Channel Financing 40 CRISIL B/Stable
The rating reflects Heena's moderate scale of operations in the
highly competitive and fragmented steel trading industry, along
with the susceptibility of its operating performance to demand
from end user industry. The rating also factors in the firm's
below financial risk profile, marked by small net worth, high
total outside liabilities to tangible net worth (TOLTNW) ratio and
subdued debt protection metrics. These rating weaknesses are
partially offset by the extensive experience of the promoters in
the iron and steel trading segment and established relationship
with suppliers and customers along with funding support provided
by them.
For arriving at its rating, CRISIL has treated unsecured loans of
INR38.5 million from promoters and family as neither debt nor
equity as these have been subordinated to the bank and are
expected to be retained in the business.
Outlook: Stable
CRISIL believes that Heena would continue to benefit over the
medium term from long track record of its promoter in the iron and
steel trading segment and established relations with its suppliers
and customers. The outlook may be revised to 'Positive' if there
is significant equity infusion by promoters or significant
improvement in profitability resulting in higher than expected
cash accruals and resulting in improvement in capital structure of
the firm. Conversely, the outlook may be revised to 'Negative' in
the event decline in revenues and profitability or if financial
risk profile deteriorates due to further stretch in working
capital cycle, impacting its capital structure or significant
withdrawals by the promoter.
Established as a proprietorship concern in 1978 in Mumbai
(Maharashtra) by Mr. Bharatkumar Bhuta, Heena Enterprises is
engaged in the trading of iron and steel products. The firm
primarily trades in long steel products like TMT bars. The day to
day operations of the firm are managed by Mr. Bharatkumar Bhuta
and his son Mr. Bhavin Bhuta.
J M MHATRE: CRISIL Assigns 'B' Rating to INR150MM Bank Loan
-----------------------------------------------------------
CRISIL has assigned its 'CRISILB/Stable' rating to the long-term
bank facilities of J M Mhatre Constructions Pvt Ltd. The rating
reflects JM Constructions' susceptibility to project
implementation risks and to cyclicality in the real estate
segment. These rating weaknesses are partially offset by the
benefits that the company derives from its resourceful promoters
and the attractive location of the project.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Proposed Long Term 150 CRISIL B/Stable
Bank Loan Facility
Outlook: Stable
CRISIL believes that JMM Constructions will continue to benefit
from the funding support it receives from its promoters. The
outlook may be revised to 'Positive' if the company completes its
project without significant time or cost overrun and registers
better-than-expected customer bookings/realisations, resulting in
improvement in its liquidity. Conversely, the outlook may be
revised to 'Negative' in case of cash flow mismatches resulting
from delay in project execution or cost escalation, or subdued
booking rates leading to tepid flow of advances, resulting in
weakening of its liquidity.
Incorporated in 2010, JMM Constructions proposes to undertake a
residential real estate project at Karjat in Raigad District
(Maharashtra). The project is expected to start by December 2014.
JAJOO ENTERPRISES: CRISIL Cuts Rating on INR450MM Loans to 'D'
---------------------------------------------------------------
CRISIL has downgraded its ratings on the bank facilities of Jajoo
Enterprises Ltd (JEL; part of the Jajoo group) to 'CRISIL D/CRISIL
D' from 'CRISIL BB+/Stable/CRISIL A4+'. The rating downgrade
reflects the Jajoo group's prolonged over-utilisation of its
working capital limits. This was caused by delay in realisation of
receivables from customers.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Cash Credit 420 CRISIL D (Downgraded from
'CRISIL BB+/Stable')
Letter of Credit 30 CRISIL D (Downgraded from
'CRISIL A4+')
The Jajoo group also has a below-average financial risk profile
and low profitability, and is exposed to intense competition in
the fabrics trading industry. The group, however, benefits from
the extensive industry experience of its promoters, its
established relationships with various suppliers, and its asset-
light business model.
For arriving at its ratings, CRISIL has combined the business and
financial risk profiles of JEL, Prahladrai Fabrics Ltd, and Guru
Aashish Texfab Ltd. This is because these three companies,
together referred to as the Jajoo group, are engaged in similar
lines of business and have common promoters. Besides, JEL and GATL
have extended corporate guarantees to each other.
JEL was set up by Mr. Kamal Jajoo in Mumbai in 2000. JEL is a
closely held public limited company trading in fabrics used for
making shirts and suits. The company is a part of the Jajoo group,
which was established by Mr. Prahladrai Jajoo (grandfather of Mr.
Kamal Jajoo) in Gwalior (Madhya Pradesh), in 1951. The other key
group companies include GATL (incorporated in 2003) and PFL
(incorporated in 1992), which also operate in a similar line of
business.
The Jajoo group, on a provisional basis, reported a profit after
tax (PAT) of INR56.8 million on net sales of around INR8.79
billion for 2012-13 (refers to financial year, April 1 to
March 31); it had reported a PAT of INR54.84 million on net sales
of INR9.62 billion for 2011-12.
JODHPUR HEALTH: CRISIL Assigns 'B' Rating to INR415MM Loans
-----------------------------------------------------------
CRISIL has assigned its 'CRISIL B/Stable/CRISIL A4' ratings to the
bank facilities of Jodhpur Health Care Private Limited.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Term Loan 375 CRISIL B/Stable
Bank Guarantee 20 CRISIL A4
Proposed Long Term
Bank Loan Facility 40 CRISIL B/Stable
The ratings reflect JHPL's exposure to risks related to on-going
hospital project and exposure to risks related to stabilisation
during initial stages of operations. These rating weaknesses are
partially offset by the benefits that the company derives from its
promoters' extensive experience in health care industry and
executing similar projects in the past.
Outlook: Stable
CRISIL believes that Jodhpur Health Care Private Limited (JHPL)
will maintain a stable credit risk profile on the back of
promoter's extensive experience. The outlook may be revised to
'Positive' in case of timely execution of the project within the
projected cost or in case of higher than expected occupancy levels
and profitability; resulting in higher than expected accruals and
thus better financial risk profile. Conversely, the outlook may be
revised to 'Negative' in case of any time or cost overrun which
would adversely impact the financial risk profile of the company
and thus its debt-servicing ability.
JHPL, incorporated in 2012 as a private limited company, is
promoted by the Jodhpur-based Dr. S L Agarwal, Mr. Shashikant
Singhi, Mr. Navneet Agarwal, Mrs. Renu Singhi, Mr. M K M Shah and
Mr. Hari Singh Shekhawat. JHPL is setting up a 204-bed, super-
specialty hospital (providing neurology, cardiology, gynaecology,
and orthopaedic care) in Jodhpur under the brand, Medipuls
Hospital. The project is expected to be completed by April 2014.
MAHAVIR RICE: CRISIL Ups Rating on INR10MM Cash Credit to 'B+'
--------------------------------------------------------------
CRISIL has upgraded its rating on the long-term bank facilities of
Mahavir Rice Mills (MRM; part of the MRM group) to 'CRISIL
B+/Stable' from 'CRISIL B/Stable', while reaffirming its rating on
the firm's short term facilities at 'CRISIL A4'.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Cash Credit 10 CRISIL B+/Stable (Upgraded
from 'CRISIL B/Stable')
Packing Credit 120 CRISIL A4 (Reaffirmed)
The rating upgrade reflects the improvement in the MRM group's
business risk profile and working capital cycle. The group's net
sales grew to around INR1390 million in 2012-13 (refers to
financial year, April 1 to March 31) from INR590 million in 2010-
11, driven by strong domestic and overseas demand for basmati
rice. This was supplemented by reduction in its gross current
assets to 70 days as on March 31, 2013, from 153 days a year
earlier due to reduced inventory holding in order to mitigate
risks relating to fluctuation in raw material prices. Reduced
working capital has resulted in lower working capital borrowing
and has led to a better-than-expected financial risk profile,
marked by an improvement in gearing and debt protection metrics.
The group's gearing reduced to 3.22 times as on March 31, 2013,
from 11.18 times as on March 31, 2012, while its net cash
accruals to total debt ratio improved to 0.11 times in 2012-13
from 0.03 times in 2011-12.
The upgrade also reflects the improvement in the MRM group's
liquidity, with expected cash accruals of around INR11.0 million
in 2013-14, which are expected to be sufficient to meet term debt
obligations of INR6 million during the year. Its liquidity is
further supported by the continuous extension of unsecured loans
by its partners, the balance of which was around INR102.4 million
as on March 31, 2013.
The ratings reflect the MRM group's weak financial risk profile,
marked by a small net worth, high gearing, and weak debt
protection metrics. The ratings also factor in the group's
susceptibility to risks related to changes in regulatory policies,
volatility in raw material prices, and dependence on the monsoon.
These rating weaknesses are partially offset by the extensive
experience of the MRM group's partners in, and healthy growth
prospects for, the rice industry.
For arriving at the ratings, CRISIL has combined the business and
financial risk profiles of MRM and BD Overseas (BDO), together
referred to as the MRM group. This is because the two entities
have common partners, are engaged in a similar line of business,
and have strong business and financial linkages.
Outlook: Stable
CRISIL believes that the MRM group's financial risk profile will
remain constrained over the medium term, marked by a small net
worth and high gearing. The group's business risk profile will,
however, continue to be supported by its partners' extensive
industry experience. The outlook may be revised to 'Positive' if
there is a significantly greater-than-expected improvement in the
MRM groups' scale of operations and profitability, leading to
larger-than-expected cash accruals, or in case of infusion of
capital by the partners, leading to an improvement in its
financial risk profile. Conversely, the outlook may be revised to
'Negative' if the group's financial risk profile weakens, most
likely because of a decline in sales, large debt-funded capital
expenditure, or sizeable capital withdrawals by the partners.
The MRM group mills, processes, and sells basmati rice in India
and abroad. It produces only parboiled rice, which has strong
demand in the Middle East and Iran. MRM was set up in 1984 as a
partnership firm by Mr. Jai Kumar Garg and his sons, Mr. Anil
Kumar and Mr. Parveen Kumar. BDO was set up by the Garg family to
increase the group's installed capacity. The group has a capacity
of 4 tonnes per hour (tph) for milling and 8 tph for sorting
(including BDO's 2 tph and 5 tph capacities for milling and
sorting, respectively, that were commissioned in June 2011).
NAGPAL WAREHOUSE: CRISIL Rates INR60MM Term Loan at 'B+'
--------------------------------------------------------
CRISIL has assigned its 'CRISIL B+/Stable' rating to the long-term
bank facility of Nagpal Warehouse Inc.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Term Loan 60 CRISIL B+/Stable
The rating reflects NWI's start-up phase of operations, dependence
on primary operational cash flows and exposure to high customer
concentration risk. These rating weaknesses are partially offset
by the benefits that NWI is likely to derive from its long-term
offtake agreement with Ava Merchandising Solutions Pvt Ltd (Ava)
leading to revenue visibility and comfortable financial risk
profile, particularly debt service coverage ratio.
Outlook: Stable
CRISIL believes that NWI will continue to benefit over the medium
term from its offtake agreement with Ava and will maintain its
above-average financial risk profile. The outlook may be revised
to 'Positive' if NWI scales up operations through timely
implementation of its ongoing capital expenditure (capex) and
witnesses a significant and sustained improvement in margins and
accruals leading to improvement in its debt servicing metrics.
Conversely, the outlook may be revised to 'Negative' in case of
delay in completion of the ongoing capex or delays in receipt of
rentals from clients or termination of lease agreement with Ava,
affecting NWI's ability to service its debt in a timely manner.
NWI, a partnership firm set up in 2012, is promoted by Mr.
Kanhaiya Nagpal and his son Mr. Ajay Nagpal. The firm is
constructing a warehouse on 226,512 square feet of land to
facilitate storage of agriculture-based products in Sonepat
(Haryana). It has obtained approvals for the project. The expected
completion date for the project is April 2014.
NANU RAM: ICRA Reaffirms 'B+' Rating on INR6cr Crash Credit
-----------------------------------------------------------
ICRA has reaffirmed a long term rating of '[ICRA]B+' assigned to
the INR6.0 Crore (enhanced from INR5.0 Crore) bank facilities of
Nanu Ram Jindal Gum & Chemicals Private Limited.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Cash Credit 6.0 [ICRA]B+ reaffirmed
The rating is constrained by the inexperience of promoters in guar
gum industry; relatively low market share of the company in
relation to the overall guar gum processing industry in the
country; agro-climatic risks related to guar seed production; and
adverse financial risk profile characterised by low profitability
and aggressive capital structure.
The rating, however, factors in the healthy demand prospects for
guar gum; limited competition from substitutes for the oil and gas
segment, although some new products are being developed for the
food segment, and the proximity of the company's plant to raw
material supply.
Nanu Ram Jindal Gum & Chemical Private Limited incorporated in
April 2012 promoted by Mrs. Shankuntla Devi & Mr. Neeraj Jindal.
The company is a manufacturer and trader of guar gum and
associated products. It is a promoter family-driven company, with
its manufacturing plant located in Siwani Mandi Haryana. The
company has manufacturing capacity of 5400 metric ton per annum
guar splits. Company supplies guar gum split to the manufacturers
of guar gum powder.
Recent Results
Nanu Ram Jindal Gum & Chemicals Private Limited reported turnover
of INR8.63 Crore and net profit of INR0.04 Crore in FY13.
PRAHLADRAI FABRICS: CRISIL Cuts Ratings on INR950MM Loans to 'D'
----------------------------------------------------------------
CRISIL has downgraded its rating on the long-term bank facilities
of Prahladrai Fabrics Ltd (PFL; part of the Jajoo group) to
'CRISIL D' from 'CRISIL BB+/Stable'. The rating downgrade reflects
the Jajoo group's prolonged over-utilisation of its working
capital limits. This was caused by delay in realisation of
receivables from customers.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Cash Credit 350 CRISIL D (Downgraded from
'CRISIL BB+/Stable')
Proposed Long Term 600 CRISIL D (Downgraded from
Bank Loan Facility 'CRISIL BB+/Stable')
The Jajoo group also has a below-average financial risk profile,
and low profitability, and is exposed to intense competition in
the fabrics trading industry. The group, however, benefits from
the extensive industry experience of its promoters, its
established relationships with various suppliers, and its asset-
light business model.
For arriving at its rating, CRISIL has combined the business and
financial risk profiles of PFL, Jajoo Enterprises Ltd (JEL), and
Guru Aashish Texfab Ltd. This is because these three companies,
together referred to as the Jajoo group, are engaged in similar
lines of business and have common promoters. Besides, JEL and GATL
have extended corporate guarantees to each other.
PFL was set up by Mr. Kamal Jajoo along with his father Mr.
Satyaprakash Jajoo and his brother Mr. Sharad Jajoo, in Mumbai in
1992. PFL is a closely held public limited company trading in
fabrics used for making shirts and suits. The company is a part of
the Jajoo group, which was established by Mr. Prahladrai Jajoo
(grandfather of Mr. Kamal Jajoo) in Gwalior (Madhya Pradesh), in
1951. The other key group companies include GATL (incorporated in
2003) and JEL (incorporated in 2000), which also operate in a
similar line of business.
The Jajoo group, on a provisional basis, reported a profit after
tax (PAT) of INR56.8 million on net sales of around INR8.79
billion for 2012-13 (refers to financial year, April 1 to March
31); it had reported a PAT of INR54.84 million on net sales of
INR9.62 billion for 2011-12.
PRINCES BUILDTECH: ICRA Reaffirms 'B+' Rating on INR15cr Loans
--------------------------------------------------------------
ICRA has reaffirmed the long-term rating of [ICRA]B+ assigned
earlier to the INR2.00 crore fund based limits and INR13.00 crore
term loans of Princes Buildtech & Infrastructure Developers
Private Limited.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Fund Based Limits 2.00 [ICRA]B+ (Reaffirmed)
Term Loans 13.00 [ICRA]B+ (Reaffirmed)
The rating factors in the adequate progress achieved in PBPL's
projects Princess' Business Skypark and Princess' Business
Skyline, which has been in line with expectation. The rating
continues to draw support from the extensive experience of PBPL's
promoters (Mr. Manoj Manwani and Mr. Vinod Lalwani) in the real
estate industry in Indore, Madhya Pradesh and the funding support
from them by way of unsecured loans. However, the same are
interest bearing in nature. The rating strengths are partially
offset on account of slower than expected sales velocity which
coupled with slowdown in the real estate sector exposes the
company to significant marketing risk. The risk is further
accentuated in the backdrop of commencement of the debt
repayments. Further, ICRA has noted increase in project cost which
is expected to be funded through promoter funds and customer
advances. The rating also takes into account PBPL's weak financial
profile as characterized by modest debt coverage indicators and
vulnerability to the cyclicality inherent in the real estate
industry in India. ICRA believes adequacy of sales and timely
collections from customers and extent of dependence on promoters
support will remain amongst the key rating sensitivities going
forward.
Princes Buildtech & Infrastructure Private Limited was
incorporated in 1999 and was previously known as Reny Housing Pvt.
Ltd. With the approvals from the competent authorities, the name
was changed from Reny Housing Pvt. Ltd. to Princes Buildtech &
Infrastructure Developers Pvt. Ltd. on 05-02-2008. The company is
a closely held company and is engaged in the development and
marketing of real estate project, primarily in Indore region.
Currently, PBPL is developing two commercial projects Princes
Business SkyPark and Princes Business Skyline. The total
saleable/leasable area for both the projects is around 2,84,000
sq.ft (company's share being 2,03,500 sq.ft). The projects are
being developed at an estimated cost of INR60.25 crore. As on
December 31, 2013, about INR45.68 crore has been spent on these
two projects.
For FY13, the company reported INR2.5 crore of net profit on an
operating income of INR11.74 crore as compared to INR0.554 crore
of net profit on an operating income of INR5.77 crore a year ago.
The net profit in FY13 was supported by one time gain of INR3
crore.
RISHI TRADERS: CRISIL Rates INR80MM Cash Credit at 'B+'
-------------------------------------------------------
CRISIL has assigned its 'CRISIL B+/Stable' rating to the long term
bank facilities of Rishi Traders.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Cash Credit 80 CRISIL B+/Stable
The rating reflects subdued financial risk profile, marked by a
small net worth, high gearing and modest debt protection metrics,
working capital intensive nature of operations and exposure to
intense competition in the cotton ginning industry. These
weaknesses are partially offset by the extensive entrepreneurial
experience of RT's promoters.
Outlook: Stable
CRISIL believes that the RT will continue to benefit over the
medium term from the extensive experience of its promoters. The
outlook may be revised to 'Positive' if RT reports significantly
higher than expected revenues, and profitability margins while
improving its capital structure. Conversely, the outlook may be
revised to 'Negative' in case of a significant decline in the
firm's revenues or profitability or if its capital structure
deteriorates on account of elongation of working capital cycle.
RT established in 2011 is engaged in ginning and pressing of raw
cotton. The day-to-day operations of the firm are managed by Mr
Kirti Kumar Patel and Mr Harilal Patel. The firm has its
manufacturing unit at Nagpur (Maharashtra).
RT reported a profit after tax (PAT) of INR2.36 million on net
sales of INR 96.3 million for 2012-13 (refers to financial year,
April 1 to March 31) against PAT of INR 0.3 million in 2011-12 on
net sales of INR 108.5 million.
RUDRESH EDUCATION: ICRA Suspends B+ Rating on INR7.5cr Loans
------------------------------------------------------------
ICRA has suspended '[ICRA]B+' rating for INR7.50 crore bank
facilities of Rudresh Education Society.
The suspension follows ICRA's inability to carry out a rating
surveillance in the absence of the requisite information from the
company.
According to its suspension policy, ICRA may suspend any rating
outstanding if in its opinion there is insufficient information to
assess such rating during the surveillance exercise.
Rudresh Education Society was established in the year 2006 and
managed by Juneja family and Dora family. Mr. Sunil Juneja is
president of the trust. The society is a non-profit organization
and operates one school, Himalaya International, in Ratlam, Madhya
Pradesh under the Rudresh Education Society. The curriculum in the
international school is affiliated to Central Board of Secondary
Education (CBSE).
S. V. BANDI: CRISIL Assigns 'B+' Rating to INR30MM Loan
-------------------------------------------------------
CRISIL has assigned its 'CRISIL B+/Stable/CRISIL A4' ratings to
the bank facilities of S. V. Bandi Engineers & Contractors.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Bank Guarantee 45 CRISIL A4
Overdraft Facility 30 CRISIL B+/Stable
The ratings reflect SVB's modest scale of operations,
susceptibility to intense competition in the civil construction
industry, and large working capital requirements. These rating
weaknesses are partially offset by the extensive experience of the
promoters' in the civil construction industry, and its moderate
financial risk profile marked by a moderate capital structure and
debt protection metrics.
Outlook: Stable
CRISIL believes that SVB will benefit over the medium term from
the extensive experience of its promoter in the civil construction
industry. The outlook may be revised to 'Positive' if SVB scales
up its operations and operating profitability on a sustained basis
over the medium term, thereby improving its financial risk
profile. Conversely, the outlook may be revised to 'Negative' if
SVB undertakes any significant debt-funded capital expenditure
programme or if its revenues and operating profitability decline
or if the firm's promoter withdraws substantial capital, thereby
weakening its financial risk profile.
Set up in 1983, SVB is a partnership firm established and managed
by Mr. S.V. Bandi and Mr. H.V. Bandi. The firm undertakes civil
construction works for various government agencies.
For 2012-13 (refers to financial year April 1 to March 31), SVB
reported a profit after tax (PAT) of INR4.2 million on net sales
of INR144.4 million, as against a PAT of INR INR4.4 million on net
sales of INR130.4 million for 2011-12.
SAHYADRI HEALTHCARE: CRISIL Rates INR125.5MM Term Loan at 'B+'
--------------------------------------------------------------
CRISIL has assigned its 'CRISIL B+/Stable' rating to the long term
bank facilities of Sahyadri Healthcare and Diagnostics Private
Limited.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Term Loan 125.5 CRISIL B+/Stable
The ratings reflect SHD's exposure to risks associated with
initial stage of operations and subdued financial risk profile,
marked by modest net worth and high gearing. These weaknesses are
partially offset by the benefits that SHD derives from its
association with Narayana Health Private Limited for management of
its hospital venture.
Outlook: Stable
CRISIL believes that SHD would continue to benefit from its
association with NHPL over the medium term. The outlook may be
revised to 'Positive' if the company reports significantly higher
than expected accruals and if the promoters arrange for additional
infusion thereby translating to an improvement in the capital
structure. Conversely, the outlook may be revised to 'Negative' if
SHD undertakes larger than expected debt funded capital
expenditure or if the accruals are significantly below
expectations, thereby weakening its debt servicing ability.
SHD was incorporated in 2009 by Mr Raghavendra Yeddyurappa and Mr
Vijayendra Yeddyurappa. The company has setup a multi-specialty
hospital in Shimoga, Karnataka. The company has tied up with NHPL
(promoted by Dr. Devi Prasad Shetty) for management of the
hospital. The hospital commenced operations in November 2012.
SATYA MEGHA: CRISIL Reaffirms 'D' Rating on INR372MM Loans
----------------------------------------------------------
CRISIL's ratings on the bank facilities of Satya Megha Industries
continue to reflect instances of delay by SMI in servicing its
debt; the delays have been caused by the firm's weak liquidity,
driven by large debt-funded capital expenditure and a stretched
working capital cycle.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Cash Credit 200 CRISIL D (Reaffirmed)
Letter of Credit 50 CRISIL D (Reaffirmed)
Term Loan 122 CRISIL D (Reaffirmed)
SMI also has a small scale of operations in the fragmented steel
products industry, geographical and customer concentration in its
revenue profile, and a small net worth. However, the firm benefits
from the extensive experience of its partners in manufacturing and
trading in steel products.
SMI was set up in Assam in August 2009 by Mr. Ratan Sharma, Mr.
Purushottam Murarka, and Mr. Mangilal Jalan. The firm started
operations in August 2011 by manufacturing steel billets. SMI's
partners have more than 18 years of experience in manufacturing
and trading in steel products through other group companies.
SHIVAM COTEX: CRISIL Assigns 'B+' Rating to INR200MM Loans
----------------------------------------------------------
CRISIL has assigned its 'CRISIL B+/Stable' rating to the long-term
bank facilities of Shivam Cotex.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Cash Credit 177 CRISIL B+/Stable
Term Loan 23 CRISIL B+/Stable
The rating reflects the modest scale of Shivam Cotex's recently
commenced operations in the highly competitive cotton ginning
industry, and exposure to risks related to any adverse impact of
regulations. These rating weaknesses are partially offset by the
benefits that Shivam Cotex derives from its partners' extensive
experience in the cotton ginning industry, leading to its
established relationships with customers and suppliers and
location advantages of its plant to the cotton growing region.
Outlook: Stable
CRISIL believes that Shivam Cotex will continue to benefit over
the medium term from its promoter-partners' extensive industry
experience. The outlook may be revised to 'Positive' if the firm
substantially increases its scale of operations. Conversely, the
outlook may be revised to 'Negative', if the firm achieves lower
than expected accruals or the firm's financial risk profile
weakens, caused most likely by increase in working capital
borrowings, large debt-funded capital expenditure, or disruption
in its operations because of adverse regulatory changes.
Set up in 2013, Shivam Cotex is promoted by Wankaner (Gujarat)
based Aghera family and partners. The firm is in the cotton
ginning and pressing business. The firm started its operations
from November-2013.
SHREE ADEISHWAR: CRISIL Assigns 'B' Rating to INR100MM Loan
-----------------------------------------------------------
CRISIL has assigned its 'CRISIL B/Stable' rating to the long-term
bank facilities of Shree Adeishwar Traders.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Cash Credit 100 CRISIL B/Stable
The rating reflects SAT's below-average financial risk profile,
marked by weak debt protection metrics. The rating also reflects
SAT's small scale of operations in the intensely competitive rice
industry, leading to low operating profitability. These rating
weaknesses are partially offset by the benefits that SAT derives
from its proprietor's extensive experience in the basmati rice
industry.
Outlook: Stable
CRISIL believes that SAT will continue to benefit over the medium
term from its proprietor's extensive industry experience. The
outlook may be revised to 'Positive' in case SAT registers
significant improvement in its scale of operations and operating
profitability and, hence, its financial risk profile. Conversely,
the outlook may be revised to 'Negative' in case the firm
registers a decline in its profitability or if its working capital
requirements are larger than expected, leading to pressure on its
financial risk profile.
SAT is a proprietorship firm incorporated by Mr. Dinesh Jain and
is engaged in the trading of rice. The firm is based out of
Narela, Delhi and procures primarily from the Narela Mandi.
SAT reported a profit after tax (PAT) of INR0.4 million on an
operating income of INR310.8 million for 2012-13.
SHRI GIRIRAJ: CRISIL Assigns 'B' Rating to INR100MM Loan
--------------------------------------------------------
CRISIL has assigned its 'CRISIL B/Stable' rating to the long-term
bank facilities of Shri Giriraj Traders.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Cash Credit 100 CRISIL B/Stable
The rating reflects SGT's below-average financial risk profile,
marked by weak debt protection metrics. The rating also reflects
SGT's small scale of operations in the intensely competitive rice
industry, leading to low operating profitability. These rating
weaknesses are partially offset by the benefits that SGT derives
from its proprietor's extensive experience in the basmati rice
industry.
Outlook: Stable
CRISIL believes that SGT will continue to benefit over the medium
term from its proprietor's extensive industry experience. The
outlook may be revised to 'Positive' in case SGT registers
significant improvement in its scale of operations and operating
profitability and, hence, its financial risk profile. Conversely,
the outlook may be revised to 'Negative' in case the firm
registers a decline in its profitability or if its working capital
requirements are larger than expected, leading to pressure on its
financial risk profile.
SGT is a proprietorship firm incorporated by Mr. Rajpal Sharma and
is engaged in the trading of rice. The firm is based out of
Narela, Delhi and procures primarily from the Narela Mandi.
SGT reported a profit after tax (PAT) of INR0.3 million on an
operating income of INR410.2 million for 2012-13, against a PAT of
INR0.2 million on an operating income of INR357.0 million for
2011-12.
SHRI SANTKRUPA: CRISIL Upgrades Rating on INR70MM Loans to 'B-'
---------------------------------------------------------------
CRISIL has upgraded its rating on the long-term bank facilities of
Shri Santkrupa Cotton Industries to 'CRISIL B-/Stable' from
'CRISIL C'.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Cash Credit 50 CRISIL B-/Stable (Upgraded
from 'CRISIL C')
Proposed Long Term 6 CRISIL B-/Stable (Upgraded
Bank Loan Facility from 'CRISIL C')
Term Loan 14 CRISIL B-/Stable (Upgraded
from 'CRISIL C')
The rating upgrade reflects timely servicing of debt by SSCI and
its improved liquidity during the six months ended January 31,
2014. This is backed by a sustainable improvement in the firm's
estimated gross current assets (GCA) days to 100 days as on March
31, 2014 as against 138 days a year earlier, led by improved
debtor and inventory management. CRISIL believes the SSCI's will
maintain its improved liquidity over the medium term, and its cash
accruals will remain sufficient, albeit with limited cushion, as
against term debt repayments of INR3 million.
The rating reflects SSCI's below-average financial risk profile,
marked by a modest net worth and weak debt-protection metrics, and
modest scale of operations. These ratings weaknesses are partially
offset by its promoters' extensive industry experience.
Outlook: Stable
CRISIL believes that SSCI will maintain its business risk profile
over the medium term supported by its promoters' extensive
experience in the cotton ginning industry. The outlook may be
revised to 'Positive' if the company's working capital cycle
reduces or there is a material improvement in its profitability,
resulting in an improvement in its debt-protection metrics.
Conversely, the outlook may be revised to 'Negative' if SSCI's
working capital cycle lengthens or its revenues or profitability
decline, resulting in weak liquidity.
SSCI was setup in 1997 as a partnership firm by Mr. Akash Fundkar,
Mr. Harbanssingh Juneja, Mr. Karamjeetsingh Juneja and
Mr.Onkarappa Todkar. The firm processes raw cotton (kappas) into
cotton bales and cotton seeds. It also has a crushing unit to
extract deoiled cake and oil from cotton seeds. The firm's unit is
based in Khamgaon (Maharashtra).
SSCI reported a profit after tax (PAT) of INR2.2 million on sales
of INR227 million for 2012-13 (refers to financial year, April 1
to March 31), against a PAT of INR2.4 million on sales of INR201.2
million for 2011-12.
SHUBHYAN MOTORS: CRISIL Lowers Rating on INR20MM Loans to 'B'
-------------------------------------------------------------
CRISIL has downgraded its rating on the long-term bank facilities
of Shubhyan Motors Pvt Ltd to 'CRISIL B/Stable' from 'CRISIL
B+/Stable', while assigning its 'CRISIL A4' rating to the
company's short-term facilities.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Cash Credit 10 CRISIL B/Stable (Downgraded
from 'CRISIL B+/Stable')
Inventory Funding
Facility 100 CRISIL A4 (Assigned)
Term Loan 10 CRISIL B/Stable (Downgraded
from 'CRISIL B+/Stable')
The rating downgrade reflects the weakening of SMPL's liquidity
following unrelated investments. The company has purchased a stake
in a group company, Blueray Aviation Pvt Ltd, which provides
training in the aviation sector. Also, it has bought two
helicopters which it plans to lease out. These investments
involved an outlay of over INR50 million, which is over 1.2 times
the company's net worth as on March 31, 2013. Moreover, the
investments have been primarily funded by debt, thereby weakening
SMPL's liquidity. The increased annual repayment obligations of
about INR6 million will be tightly matched with its expected
annual accruals.
The ratings reflect SMPL's below-average financial risk profile,
marked by aggressive gearing and weak debt protection metrics,
though supported by healthy risk coverage. The ratings are also
constrained by the company's unrelated diversification and its
exposure to intense competition in the automobile industry. These
rating weaknesses are partially offset by the extensive experience
of SMPL's promoters in the automobile dealership business.
Outlook: Stable
CRISIL believes that SMPL will continue to benefit over the medium
term from its promoters' extensive experience in the automobile
dealership business. However, its financial risk profile will
remain weak over this period, driven by large working capital
requirements and repayment obligations. The outlook may be revised
to 'Positive' if the company's financial risk profile improves
significantly, most likely because of adequate cash accruals,
especially from the new business, to meet its term debt
obligations. Conversely, the outlook may be revised to 'Negative'
if SMPL's investment in the unrelated business increases further,
or is there is any stretch in its working capital cycle, or if its
operating margin declines.
SMPL was incorporated in 1998, promoted by Mr. Ranjeet Pawar. It
is an authorised dealer of commercial vehicles (CVs) manufactured
by Tata Motors Ltd and two-wheelers manufactured by Hero Honda
Motors Ltd (Hero Honda). The company operates three showrooms, all
in Maharashtra, one each in Ahmednagar and Satara for TML's CVs,
and one for Hero Honda's two-wheelers in Pune. SMPL also deals in
spares and provides services.
For 2012-13 (refers to financial year, April 1 to March 31), SMPL
reported a profit after tax (PAT) of INR2.4 million on an
operating income of INR1.5 billion, as against a PAT of INR11.7
million on an operating income of INR2.3 billion for 2011-12.
SWASTIK MARKETING: ICRA Assigns 'B+' Rating to INR2.50cr Loan
-------------------------------------------------------------
The long-term rating of [ICRA]B+ has been assigned to the INR2.50
crore cash credit facility of Swastik Marketing. The short-term
rating of [ICRA]A4 has also been assigned to the INR2.50 crore
short-term non-fund based limit of SM.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Cash Credit 2.50 [ICRA]B+ assigned
Bank Guarantee 2.50 [ICRA]A4 assigned
The assigned ratings are constrained by SM's modest scale of
operations and low profitability indicators on account of the
limited value addition in the business, and the tight liquidity
position of the firm as reflected by almost full utilization of
working capital bank limits in the past. The ratings are further
constrained by the competitive pressures from other established
mobile phone brands, lubricant brands and online sales platforms.
ICRA also notes that being a proprietorship firm, any substantial
capital withdrawals from the proprietor's capital account would
have a negative bearing on the gearing levels of the firm; the
quantum of withdrawals thus remains a key rating sensitivity.
The ratings, however, favourably take into account the long track
record of the promoter in the distribution business, moderate debt
coverage indicators of the firm and favourable demand prospects
for mobile phones, particularly the smart phone segment, in India.
Incorporated in 1988, Swastik Marketing is a proprietorship firm
engaged in trading and distribution business. Currently, SM is a
distributor of Blackberry mobile phones, Karbonn mobile
phones, Byond mobile phones, LG mobile phones and Shell
lubricants. The firm is also engaged in trading of grey cloth. SM
is promoted by Mr. Sandeep Jain.
Recent Results
During FY 2013, SM reported an operating income of INR35.02 crore
and profit after tax of INR0.37 crore as against an operating
income of INR26.61 crore and profit after tax of INR0.36 crore
during FY2012.
T.J.S. ENGINEERING: CRISIL Raises Rating on INR90MM Loan to B+
--------------------------------------------------------------
CRISIL has upgraded its rating on the bank facilities of
T.J.S. Engineering College to 'CRISIL B+/Stable' from 'CRISIL
B/Stable'.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Term Loan 90 CRISIL B+/Stable (Upgraded from
'CRISIL B/Stable')
The rating upgrade reflects CRISIL's belief that TJSEC, a part of
the TJ Sivananda Mudaliar Educational Trust, will sustain the
improvement in its cash accruals, and consequently, in its
liquidity over the medium term. The institute's cash accruals
increased with consistent adequacy in the enrollments to its
courses. TJSEC's cash accruals increased to INR33.2 million in
2012-13 (refers to financial year, April 1 to March 31) from
INR23.3 million in 2011-12, and could improve to around INR45
million in 2013-14.
The rating reflects TJSEC's susceptibility to changing student
preferences and competition and vulnerability to regulatory risks
associated with educational institutions. These rating weaknesses
are partially offset by the extensive entrepreneurship experience
of the promoters and their established business relations. The
rating also factors in the institute's above-average financial
risk profile, marked by low gearing and moderate debt protection
metrics.
Outlook: Stable
CRISIL believes that TJSEC will continue to benefit from its
promoters' extensive entrepreneurship experience over the medium
term. The outlook may be revised to 'Positive' if the institute
scales up its operations, and maintains its operating margin and
capital structure. Conversely, the outlook may be revised to
'Negative' if TJSEC's financial risk profile deteriorates with a
substantial decline in its student intake, revenues and operating
margin; or large debt-funded capital expenditure.
TJSEC was established by TJSMET. The institute started its first
academic session in 2009-10, with the Bachelor in Technology
degree. The trust, TJSMET, also founded T.J.S Polytechnic College
(TJSPC), which began its academic sessions in 2010-11, with a
Diploma in Engineering. The institutes share an 11.5 acre campus
in Peruvoyal, Thiruvallur (Tamil Nadu). TJSEC and TJSPC are
affiliated to Anna University (Chennai), and accredited by the All
India Council for Technical Education (AICTE).
TJSMET was setup in 2007 by Late Mr. T.J.Sivananda Mudaliar. The
trust reported a net surplus of INR25.7 million on an operating
income of INR138.5 million for 2012-13 (refers to financial year,
April 1 to March 31), against a surplus of INR16.9 million on an
operating income of INR92.4 million for 2011-12.
TRENDY WHEELS: CRISIL Reaffirms 'B+' Rating on INR60MM Loans
------------------------------------------------------------
CRISIL's ratings on the bank facilities of Trendy Wheels Pvt Ltd
continue to reflect its moderate financial risk profile, low
bargaining power with the principal and exposure to intense
competition in the automotive dealership segment. These rating
weaknesses are partially offset by the promoters' extensive
industry experience.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Bank Guarantee 20 CRISIL A4(Reaffirmed)
Cash Credit 30 CRISIL B+/Stable (Reaffirmed)
Proposed Long Term
Bank Loan Facility 25 CRISIL B+/Stable (Reaffirmed)
Term Loan 5 CRISIL B+/Stable (Reaffirmed)
Outlook: Stable
CRISIL believes that TWPL will continue to benefit over the medium
term from the promoters' extensive experience in the automotive
dealership segment. The outlook may be revised to 'Positive' if
the company enhances its cash accruals, and improves its capital
structure and working capital cycle. Conversely, the outlook may
be revised to 'Negative' if TWPL's financial risk profile weakens
with a sizeable decline in its revenues or profitability, or an
increase in its working capital cycle, or sizeable debt-funded
capital expenditure (capex).
Update:
TWPL's revenue increased to INR941 million in 2012-13 (refers to
financial year, April 1 to March 31), from INR847.3 million in the
previous year. The growth primarily resulted from an increase in
sport utility vehicle (SUV) sales of the principal, Mahindra &
Mahindra Ltd (M&M; rated 'CRISIL AA+/Stable/CRISIL A1+'), and the
resultant growth in sales of spares and accessories. TWPL's
operating margin was constrained by the nature of its business, at
less than 4 per cent for 2012-13. CRISIL believes that TWPL will
continue to improve its scale of operations over the medium term,
supported by the healthy demand outlook for its principal's
vehicles.
TWPL's financial risk profile remains moderate, marked by its
small net worth and high total outside liabilities to tangible net
worth (TOLTNW) ratio of INR40 million and 4.78 times,
respectively, for 2012-13. The company had moderate debt
protection metrics with its interest coverage and net cash
accruals to total debt (NCATD) ratios of 1.69 and 0.09 times,
respectively, for 2012-13. TWPL's liquidity continues to be
stretched with high inventory resulting in almost fully utilised
bank lines. The company's inventory increased to 48 days as on
March 31, 2013, from 23 days the previous year, with its principal
pushing inventory onto dealers. Consequently, TWPL's incremental
working capital requirements were INR51 million in 2012-13,
resulting in extensive reliance on external debt. However, the
absence of fixed debt obligations supports the company's
liquidity.
TWPL was incorporated in Kolhapur (Maharashtra) in 2005. The
company is promoted by Mr. Uday Lokhande and Mrs. Vaishali
Lokhande. TWPL is an exclusive authorised dealer for M&M utility
vehicles, passenger cars and SUVs in Kolhapur (Maharashtra).
TWPL reported a profit after tax (PAT) of INR4.2 million on net
sales of INR941 million for 2012-13, as against a PAT of INR6.4
million on net sales of INR847.3 million for 2011-12.
VHV BEVERAGES: CRISIL Assigns 'B' Rating to INR170.7MM Loans
------------------------------------------------------------
CRISIL has assigned its 'CRISIL B/Stable' rating to the bank
facilities of VHV Beverages Pvt Ltd.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Cash Credit 15 CRISIL B/Stable
Term Loan 155.7 CRISIL B/Stable
The rating reflects VHV's weak financial risk profile and nascent
stages of operations in a highly competitive industry. These
rating weaknesses are partially offset by the promoters'
experience and financial support from them.
Outlook: Stable
CRISIL believes that VHV's business risk profile is constrained on
account of the limited track record of its operations. The outlook
may be revised to 'Positive' in case of higher-than-expected sales
while maintaining above-average profitability leading to
improvement in the financial risk profile of the company.
Conversely, the outlook may be revised to 'Negative' in case of
any significant deterioration in the financial risk profile due to
higher-than-expected working capital requirements or/and large
debt-funded capital expenditure.
VHV, a wholly owned subsidiary of V&V Corporation Pvt Ltd (V&V),
was formed in 2012.VHV manufactures packaged drinking water and
carbonated soft drinks (CSD) under its Xalta brand with
manufacturing unit located at Jhajjar, Haryana. The operations and
management of the company is headed by Mr. Vishnoo Mittal and Mr.
Vinod Sehwag.
VIRAJ ALCOHOL: CRISIL Assigns 'B+' Rating to INR220MM Loans
-----------------------------------------------------------
CRISIL has assigned its 'CRISIL B+/Stable' rating to the long term
bank facilities of Viraj Alcohol & Allied Industries Ltd.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Cash Credit 50 CRISIL B+/Stable
Term Loan 170 CRISIL B+/Stable
The rating reflects VAAIL's stretched liquidity, marked by cash
accruals closely matching its debt obligations, and high bank
limit utilisation. The rating also factors in VAAIL's modest scale
of operations and moderate working capital requirements. These
rating weaknesses are partially offset by the funding support
from, and the extensive experience of the promoters in the grain-
based distillery segment; and VAAIL's moderate financial risk
profile, marked by its comfortable capital structure.
Outlook: Stable
CRISIL believes that VAAIL will continue to benefit from the
promoters' established experience in the grain-based distillery
segment over the medium term. The outlook may be revised to
'Positive' if the company significantly increases its scale of
operations and profitability, resulting in sizeable cash accruals.
Conversely, the outlook may be revised to 'Negative' if VAAIL
records a decline in its cash accruals due to pressure on its
scale of operations or profitability; or undertakes a considerable
capital expenditure programme, thus weakening its overall
financial risk profile and liquidity.
VAAIL was established in Sangli (Maharashtra) in 2002 as a private
limited company, and reconstituted as a closely held public
limited company in 2005. VAAIL is a grain-based alcohol producer,
and manufactures extra neutral alcohol (ENA), rectified spirit,
distillery dry grain soluble (DDGS), distillery wet grain soluble
(DWGS) and country liquor. VAAIL has an ENA production facility in
Sangli (Maharashtra) with an installed capacity of 60 kilo litres
per day (KLPD); the capacity was recently enhanced from 30 KLPD.
VAAIL reported a net loss of INR5.2 million on net sales of INR620
million for 2012-13 (refers to financial year, April 1 to
March 31); the company reported a profit after tax of INR181
million on net sales of INR530 million for 2011-12.
VRUNDAVAN GINNING: CRISIL Cuts Rating on INR100MM Loans to 'B'
---------------------------------------------------------------
CRISIL has downgraded its rating on the long-term bank facilities
of Vrundavan Ginning & Oil Mill to 'CRISIL B/Stable' from CRISIL
B+/Stable'. The rating downgrade reflects deterioration in the
firm's financial risk profile due to low cash accruals and large
working capital requirements.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Cash Credit 60 CRISIL B/Stable (Downgraded
from 'CRISIL B+/Stable')
Warehouse Financing 30 CRISIL B/Stable (Downgraded
from 'CRISIL B+/Stable')
Proposed Long Term 10 CRISIL B/Stable (Downgraded
Bank Loan Facility from 'CRISIL B+/Stable')
During 2012-13 (refers to financial year, April 1 to March 3),
VGOM's sales declined to INR196.5 million from INR294.5 million in
2011-12 due to limited availability of cotton. Although, the
firm's operating margin improved to 5.3 per cent during 2012-13
from 2.2 per cent in 2011-12 backed by inventory profits, its
accruals remained low at INR1.1 million. Against this, the firm
had large working capital requirements reflected in its gross
current assets of 218 days. Raw cotton, its major raw material, is
available only during the crop season, that is, from October to
March. The company, therefore, procures raw material during this
period for the next year's requirements. This results in high
inventory levels at year end. As on March 31, 2013, VGOM had
inventory of 184 days. Low cash accruals against large inventory
requirements had resulted in high debt levels, and consequently
its gearing declined to 2.57 times as on March 31, 2013, from 1.70
times as on March 31, 2012. This has also resulted in
deterioration in debt protection metrics; VGOM's net cash accruals
to total debt and interest coverage ratios were at 0.01 times and
1.48 times, respectively, for 2012-13.
Although CRISIL expects VGOM to book a healthy top line growth of
over 120 per cent in 2013-14, supported by good monsoon and
improvement in availability of cotton, its financial risk profile
is expected to remain below-average driven by large debt-funded
working capital requirements. CRISIL expects VGOM's gearing to
remain over 2 times over the medium term. Its operations will also
remain highly susceptible to erratic rainfalls and availability of
raw cotton over the medium term.
The rating continues to reflect VGOM's below-average financial
risk profile, marked by small net worth, high gearing and below-
average debt protection metrics, and its susceptibility to erratic
rainfall. These rating weaknesses are partially offset by its
promoters' extensive experience in the cotton industry and its
proximity to cotton growing belts.
Outlook: Stable
CRISIL believes that VGOM will continue to benefit over the medium
term from its promoters' extensive industry experience and its
credit risk profile will remain exposed to availability of raw
cotton. The outlook may be revised to 'Positive' if the firm
reports a sustainable and significant increase in its cash
accruals, or receives a large equity infusion which improves its
capital structure. Conversely, the outlook may be revised to
'Negative' if VGOM's profitability declines because of volatility
in cotton prices, or its financial risk profile, particularly its
liquidity, deteriorates because of a stretch in working capital
cycle or any larger-than-expected debt-funded capital expenditure
programme.
Formed in 1997, VGOM is a partnership firm promoted by the
Bhavnagar (Gujarat)-based Mr. Madhubhai Badarka, Mr. Panchubhai
Bhadarka, and six other partners. The firm is engaged in cotton
ginning and pressing, with capacity of 200 bales per day.
For 2012-13, VGOM reported a book profit of INR0.80 million on net
sales of INR196.5 million, against a book profit of INR0.40
million on net sales of INR294.5 million for 2011-12.
=================
I N D O N E S I A
=================
INDOSAT TBK: 2013 Results Within Moody's Ba1 Rating Expectations
----------------------------------------------------------------
Moody's Investors Service says that PT Indosat Tbk's operating
performance for FY2013 was weaker than expected, but can be
accommodated within its Ba1 rating with a stable outlook.
In line with expectations, reported revenue grew by 6.4% year-on-
year (YoY) to IDR23.9 trillion, driven by strong revenue growth in
data and value added services. Indosat also recorded a modest 1.9%
YoY growth in mobile subscribers and 3% YoY rise in the blended
average revenue per user to IDR27,700 from IDR26,800.
"However, despite revenue growth, Indosat reported a decline of
52% YoY in operating profit, mainly on account of higher
maintenance expenses, inter-connect fees, restructuring and legal
fees," says Nidhi Dhruv, a Moody's Assistant Vice President.
At the same time, Indosat's reported EBITDA and EBITDA margin
declined to IDR10.4 trillion and 43.5% from IDR10.5 trillion and
47.0% in FY2012, respectively.
"While the legal fees and payouts associated with the pending
litigation with regard to the PT Indosat Mega Media case as well
as the severance payouts associated with restructuring are one-off
in nature, Moody's note that much of the deterioration in
operating profit comes from recurring maintenance costs, inter-
connect fees and personnel costs which will continue to weigh on
the company's operating margins," says Dhruv, also the Lead
Analyst for Indosat.
Capex for FY2013 of IDR9.7 trillion was above previous guidance,
and 67% higher than the previous year leading to negative free
cash flow of IDR0.7 trillion for the same period. Approximately
85% of the capex was spent on modernizing the cellular network to
better support future data demand. Management has guided to capex
of IDR8-9 trillion for 2014.
"Expected high capex for network modernization and spectrum
refarming will continue to weaken cash flow metrics over the next
1-2 years. Nonetheless, these investments are imperative to make
Indosat's networks 3G-ready and remain competitive, especially
against its closest competitor, XL Axiata (Ba1 stable), which has
significantly spent on network expansion since 2011, and is likely
to be in a position of strength following the acquisition of Axis
Telekom (unrated)," adds Dhruv.
Moody's expects 2014 to a be a continuation of the transformative
process that Indosat is going through in order to build out its 3G
network and material improvement in metrics is only expected in
FY2015.
As of 31 December 2013, Indosat's leverage -- as measured by
reported gross debt/EBITDA -- increased to 2.67x from 2.43x in the
previous year. Much of the increase in leverage is on account of
the weaker Indonesian Rupiah, which depreciated by 18% during the
year As of 31 December 2013, approximately 47% of Indosat's total
debt was denominated in US dollars.
"While only US$175.0 million or 18.5% of the Company's USD debt is
hedged (as of Sep 2013), the cash impact of this is still some
time off as approximately 70% of this is the USD650 million bond
which only matures in 2020. Hence, the company has time at hand to
rebalance its debt mix or resort to hedging more foreign currency
debt," adds Dhruv.
Indosat's cash balance of IDR2.2 trillion as of December 2013,
along with our expectation of operating cash flow of around IDR8-9
trillion in the next 12 months, will be sufficient to cover IDR8-9
trillion in capex. Our expectation is for Indosat to refinance the
majority of its scheduled debt maturities of IDR6.3 trillion in
the next 12 months through additional IDR bonds or bank loans. In
this regard, Moody's draw comfort from Indosat's demonstrated
ability to secure financing in both IDR and USD, even during
volatile periods in the credit markets, which has helped to
substantially reduce refinancing risk in the recent past.
Moody's also notes that Indosat management has indicated its
decision to dispose of its 5% stake in Tower Bersama
Infrastructure Tbk (Ba2 stable), and Moody's expect the
transaction to be completed in 1H 2014. At current market price,
the stake is worth approximately IDR1.5 trillion (USD 128
million). The company plans to use the sale proceeds to pay down
debt.
The principal methodology used in this rating was the Global
Telecommunications Industry published in December 2010.
Indosat is a fully integrated telecommunications network and
services provider in Indonesia. The company is the second-largest
cellular operator in the country, as well as its leading provider
of international call services. It also provides multi-media, data
communications, and internet services. Indosat is 65%-owned by
Ooredoo Q.S.C. (previously known as Qatar Telecom, A2/stable).
MULTIPOLAR TBK: Fitch Assigns 'B+' Rating to US$30MM 9.75% Notes
----------------------------------------------------------------
Fitch Ratings has assigned Indonesia-based retailer PT Multipolar
Tbk's (Multipolar, B+/ Stable) USD30m 9.75% notes due 2018 a final
'B+' rating. The new notes are issued by Pacific Emerald Pte.
Ltd. and guaranteed by Multipolar and certain of its subsidiaries.
The new notes are issued as a tap to the existing USD200m notes
due in 2018 that have the same terms and conditions and maturity.
The notes are rated at the same level as Multipolar's senior
unsecured debt rating as they represent direct, unconditional,
unsecured and unsubordinated obligations of the company. The
rating action follows the receipt of documents conforming to
information already received. The final rating is in line with
the expected rating assigned on 27 February 2014.
KEY RATING DRIVERS
Structural Subordination: The ratings of Multipolar largely
reflect its holding company structure and its high dependence on
dividends. The ratings, however, also recognize the group's solid
market position in the Indonesian retail sector, as evidenced by a
continued strong 2013 performance by PT Matahari Putra Prima Tbk
(MPPA, not rated), in which Multipolar owns 50.2%, and PT Matahari
Department Stores Tbk (MDS, not rated), in which Multipolar holds
20.5%. Fitch expects dividends from these two companies to
account for more than 50% of Multipolar's deconsolidated cash
flows (funds from operations from wholly owned entities plus
dividends from non-wholly owned subsidiaries) in 2014 (2013: 84%).
High Fixed Costs: Notwithstanding MPPA's and MDS's strong cash-
generating ability and their moderate leverage, their strategy to
lease retail space exposes both companies to the risk of rising
rental expenses and results in weaker credit metrics compared with
other rated peers that own their retail space. In particular,
MPPA's flexibility to pay dividends is restricted by its limited
financial capacity as indicated by a modest funds from operations
(FFO) fixed charge cover of below 2x.
Currency Mismatch Pressures: As of end-2013, about 80%
Multipolar's debts were denominated in US dollars. T his places
pressure on the company's financial metrics because the majority
of its earnings are in rupiah, which has depreciated by about 20%
against the US dollar over the last 12 months. As a result, Fitch
expects Multipolar's fixed charge coverage ratio (FFO from wholly
owned entities plus dividends/ interest expense plus rents) to
fall below 2x in 2014 (2013 estimate: 2.18x). However, Fitch
expects the ratio to improve to above 2x in 2015 as Multipolar
expects PT Nadya Putra Investama (NPI, not rated), a retail
subsidiary, to distribute special dividends from its cash pile in
2015 and 2016. The fact that Multipolar retains a majority of its
existing cash balance in US dollars also mitigates the currency
volatility.
Sufficient Liquidity: Fitch expects Multipolar to be able to
maintain sufficient liquidity, primarily driven by dividend flows
from MPPA and MDS. As of end-2013, Multipolar and wholly owned
subsidiaries held cash balances totaling over USD100m, against
short-term debts of around USD24m. Fitch also believes that
Multipolar will, in a distressed scenario, have access to
additional liquidity by monetizing its shareholding in MPPA or
MDS.
Contingent Liability: Although Multipolar gains potential benefits
of heightened governance and growth targets from its strategic
alliance with Singapore-based investment company Temasek Holdings
(Temasek) in MPPA, the Indonesian company faces significant
contingent liability under the terms of the alliance agreement.
Under the agreement, if MPPA fails to meet Temasek's operating
performance targets or internal rate of return requirements,
Multipolar will have to pay Temasek any shortfall of its USD300m
investment upon the latter's exit from MPPA. However, given the
current favorable retail market outlook, the risk of this
liability crystallising is, in Fitch's view, not high.
RATING SENSITIVITIES
Negative: Future developments that may, individually or
collectively, lead to negative rating action include:
-- Decline in Multipolar's fixed charge coverage ratio (FFO
from wholly controlled entities plus dividends/ interest
expense plus rents) to below 2x on a sustained basis.
-- Weakening of MPPA's financial profile
-- Inability to secure long-term funding
Positive rating action is not expected unless there is substantial
improvement in MPPA's financial profile, including a rise in
MPPA's fixed charge coverage to above 2x on a sustained basis.
=========
J A P A N
=========
MT. GOX: Mizuho Pushed to End Dealings with Bitcoin Exchange
------------------------------------------------------------
Takashi Mochizuki and Atsuko Fukase in Tokyo and Kathy Chu in Hong
Kong, writing for The Wall Street Journal, reported that in the
months before Mt. Gox's collapse, the bitcoin exchange was coming
under increasing pressure from one of its banks, which complained
about an unmanageable volume of money transfers and repeatedly
asked the exchange to close its account with the bank, people
familiar with the situation say.
According to the report, Mizuho Bank, which handled international
wire transfers and other Mt. Gox business at a branch in Tokyo's
Shibuya district, had become worried about Mt. Gox as early as
mid-2013, following reports that the U.S. Department of Homeland
Security had seized money from a Mt. Gox account at a U.S. bank,
these people say.
Mizuho started having concerns about Mt. Gox's large volumes of
money transfers at a time when U.S. authorities were investigating
whether business dealings involving bitcoin could be linked to
money laundering, the Journal said, citing one person close to the
situation.
That person also confirmed the authenticity of a recording,
circulating widely on the Internet through social media, of a
conversation in Japanese between an official from Mizuho Bank and
Mt. Gox's head, Mark Karpeles, in late January, the report added.
The tape indicated that Mizuho was stepping up a push to
disassociate itself from Mt. Gox.
In the conversation, the bank official repeated a request that Mt.
Gox close its account with Mizuho and warned that it might take
steps to close it if Mt. Gox refused, the report related. Mr.
Karpeles said on the tape he wanted to keep the account.
MT. GOX: Plaintiffs in Class Suit Seek to Freeze U.S. Assets
------------------------------------------------------------
Rachel Abrams, writing for The New York Times' DealBook, reported
that customers of Mt. Gox are trying to freeze assets in the
United States of the bankrupt Bitcoin exchange and its chief
executive, Mark Karpeles.
According to the report, plaintiffs in a class-action lawsuit
filed a motion seeking a temporary injunction to keep Mr. Karpeles
or his company from moving any money outside of the United States.
They also want a full accounting of any assets Mt. Gox has left.
Mr. Gox, a Japan-based virtual currency marketplace, filed for
bankruptcy on Feb. 28, and Mr. Karpeles said it had lost all
750,000 customer Bitcoins, as well as 100,000 of its own -- or
more than $450 million worth, the report said. Although the
company has a subsidiary incorporated in Delaware, it's unclear
what accounts, if any, the company held in the United States.
"There were weaknesses in the system," the report cited Mr.
Karpeles as saying during a news conference in Tokyo to discuss
the bankruptcy. "I'm truly sorry to have caused inconvenience.'
Gregory Greene, an Illinois man who claims to have eventually
acquired more than $25,000 worth of Bitcoins on Mt. Gox, filed his
class-action lawsuit, three days after the company's website went
offline, charging "systematic misuse and misappropriation of its
users' property,' the report related.
* Japan's Financial Watchdog Considers Regulating Bitcoin
---------------------------------------------------------
Takashi Mochizuki and Mitsuru Obe, writing for The Wall Street
Journal, reported that Japan's government is set to clarify its
view on the virtual currency in the wake of the collapse of Tokyo-
based exchange Mt. Gox, officials said, though they appeared no
closer to declaring a specific agency in charge of overseeing
bitcoin.
According to the report, people familiar with a draft being
prepared for a cabinet meeting say the government will reaffirm
that Japan doesn't consider bitcoin a currency, the basis for the
argument by Japan's banking watchdog, the Financial Services
Agency, that bitcoin shouldn't be subject to its oversight.
The draft is being prepared by the FSA and other government
agencies in response to a letter from upper-house lawmaker Tsutomu
Okubo asking for clarification of the issue, including whether
bitcoin should be considered a currency or a type of financial
product, the report related.
One government official said, "What we are considering is that
bitcoin isn't a currency, but that doesn't mean it will
automatically be categorized as a commodity," the report further
related.
* JAPAN: Mulls Bitcoin Tax Following Mt Gox Collapse
----------------------------------------------------
Japan Today reports that Japan is looking at ways to tax bitcoin
transactions, a report said on March 4, in the wake of the
spectacular failure of the Tokyo-based Mt Gox exchange after a
half-billion-dollar theft.
According to Japan Today, the Yomiuri Shimbun newspaper said the
finance ministry and the national tax agency are studying possible
rules that could govern transactions using the digital currency.
Authorities believe purchases made with bitcoin can be subject to
consumption and corporate taxes, even though the unit is not a
legal currency, the Yomiuri said without citing sources, Japan
Today relates.
"However, many countries including Japan do not have concrete
frameworks to levy taxes (on bitcoin transactions)," the Yomiuri
said, leaving officials basically stumped.
Japan's sales tax is set to rise from the current 5% to 8% in
April.
================
S R I L A N K A
================
MULTI FINANCE: Fitch Withdraws 'B-' Rating with Watch Negative
--------------------------------------------------------------
Fitch Ratings Lanka has withdrawn Sri Lanka-based Multi Finance
PLC's (MFP) National Long-Term Rating of 'B-(lka)' with Rating
Watch Negative.
Fitch has withdrawn the ratings as it no longer has sufficient
information to maintain the rating. Accordingly, Fitch will no
longer provide ratings or analytical coverage for MFP.
*********
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, and Peter A. Chapman,
Editors.
Copyright 2014. 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 ***