/raid1/www/Hosts/bankrupt/TCRAP_Public/141001.mbx
T R O U B L E D C O M P A N Y R E P O R T E R
A S I A P A C I F I C
Wednesday, October 1, 2014, Vol. 17, No. 194
Headlines
A U S T R A L I A
AC EXPLORATION: Placed in Administration
EDIBLE CONCEPT: Wagamama Australia Goes Into Liquidation
MISSION NEW ENERGY: Incurs $1.1 Million Net Loss in Fiscal 2014
QANTAS AIRWAYS: Close To Engineers Pay Deal as Part of Cost Cut
RESIMAC VERSAILLES: S&P Assigns BB Rating to Class E Notes
T AND A MORRISSY: Placed in Administration
C A M B O D I A
CAMBODIA: S&P Affirms Then Withdraws 'B' Sovereign Credit Rating
C H I N A
CIFI HOLDINGS: S&P Revises Outlook to Pos. & Affirms 'B+' CCR
TEXHONG TEXTILE: S&P Affirms 'BB-' CCR; Outlook Stable
H O N G K O N G
EADGEAR HOLDINGS: U.S. SEC Files Charges Over Pyramid Scheme
GREENLAND HK: S&P Revises Outlook to Neg, Affirms BB+ Note Rating
I N D I A
A POWER: ICRA Suspends 'D' Rating on INR17.6cr Fund Based Loan
AGRAWAL OIL: ICRA Reaffirms 'B' Rating on INR10cr Cash Credit
AKS ALLOYS: ICRA Revises Rating on INR15cr Fund Based Loan to 'B'
AYURSUNDRA HEALTH: CRISIL Reaffirms B+ Rating on IN441.9MM Loan
BRAHMA REFRACTORIES: CRISIL Ups Rating on INR60MM Cash Loan to B+
CANDOR BIOTECH: ICRA Assigns B+ Rating to INR5.75cr Working Loan
CHINTAMANI SHARMA: ICRA Revises Rating on INR4cr FB Limits to 'B'
CICB-CHEMICON PVT: CRISIL Cuts Rating on INR454.8MM Loan to 'D'
DASARI VEER: CRISIL Ups Rating on INR107.6MM Term Loan to 'B-'
DEEPMALA FISHERIES: CRISIL Puts B Rating to INR50.5MM Bank Loan
FLOURISH PAPER: ICRA Reaffirms B+ Rating on INR6.0cr LT Scale
GARDENIA INDIA: ICRA Reaffirms B+ Rating on INR90cr Term Loan
GOVINDA MINERALS: CRISIL Cuts Rating on INR70MM Cash Loan to 'D'
HACO MACHINERY: ICRA Suspends D Rating on INR6.31cr FB Loan
JAGADAMBHA COTTON: CRISIL Cuts Rating on INR345MM Cash Loan to D
JAGWANI PROJECTS: CRISIL Reaffirms B Rating on INR40MM Cash Loan
JAISHRIRAM SUGAR: CRISIL Assigns D Rating to INR136.5MM Cash Loan
KBJ JEWEL: CRISIL Downgrades Rating on INR1.05BB Cash Loan to D
KERALA ELECTRICAL: CRISIL Assigns B Rating to INR173.5M Cash Loan
KHAS FOODS: CRISIL Assigns B Rating to INR50MM LT Bank Loan
KRISHNA NATURAL: ICRA Assigns B+ Rating to INR8.9cr Cash Credit
MILESTONE BUILDCON: CRISIL Reaffirms B Rating on INR1.40BB Loan
OM SAKTHI: CRISIL Reaffirms B Rating on INR95MM Overdraft Loan
R.J CHATHA: ICRA Assigns B+ Rating to INR10cr Packing Credit
SAHAJANAND TEXTILES: ICRA Suspends D Rating on INR14.87cr FB Loan
SANT FOODS: ICRA Reaffirms B Rating on INR17cr Fund Based Limits
SHAKUNTALA GOLD: CRISIL Cuts Rating on INR280MM Cash Loan to 'D'
SHREE TIRUPATI: CRISIL Assigns 'B+' Rating to INR50MM Cash Credit
SHRI HARI: ICRA Suspends 'D' Rating on INR12cr Cash Credit
SHUBHAM INDUSTRIES: ICRA Assigns B+ Rating to INR7.5cr Cash Loan
TROIX CHEMICALS: ICRA Cuts Rating on INR10cr Fund Based Loan to B
S I N G A P O R E
MYTRAH ENERGY: S&P Assigns 'B' LT Rating to Proposed Notes Issue
- - - - -
=================
A U S T R A L I A
=================
AC EXPLORATION: Placed in Administration
----------------------------------------
W. Roland Robson and Bill Cotter of Robson Cotter Insolvency Group
were appointed as administrators of AC Exploration Pty Ltd on
Sept. 24, 2014.
A first meeting of the creditors of the Company will be held at
Robson Cotter Insolvency Group, Suite 3, Factory 2, 97 Boundary
St, in West End, Queensland, on Oct. 7, 2014, at 10:30 a.m.
EDIBLE CONCEPT: Wagamama Australia Goes Into Liquidation
--------------------------------------------------------
Eloise Keating at SmartCompany reports that the Australian arm of
UK-based Japanese noodle franchise Wagamama has entered
liquidation and all of its Australian outlets are now closed, just
under a year after collapsing into voluntary administration.
Nathan Landrey -- nathan.landrey@fticonsulting.com -- of FTI
Consulting was appointed as liquidator of parent company Edible
Concept Holdings on September 25, after Stephen Vaughan and Ian
Hall of KPMG were appointed as administrators in October 2013,
SmartCompany relates.
SmartCompany says the first Wagamama store opened in Australia in
2002. At its peak, Wagamama operated as many as 10 restaurants in
Australia and it featured on the BRW Fast 100 in multiple years.
It is unclear how many Wagamama stores were still operating this
year, although the Wagamama restaurant at Melbourne's Southbank
closed shortly after KPMG took over, with Hall telling Fairfax at
the time the store was not profitable, according to SmartCompany.
SmartCompany, citing details available from former Edible Concept
Holdings chief executive Mark Rowland on LinkedIn, says the
Australian Wagamama restaurants were at one stage turning over
more than AUD25 million per annum.
Last month, Wagamama customers took to the chain's Facebook page
to ask why their local restaurants had closed without warning,
with claims the stores in Subiaco and Carrindale were quietly
closed, SmartCompany relates.
MISSION NEW ENERGY: Incurs $1.1 Million Net Loss in Fiscal 2014
---------------------------------------------------------------
Mission NewEnergy filed with the U.S. Securities and Exchange
Commission its annual report disclosing a net loss of $1.09
million on $9.68 million of total revenue for the year ended
June 30, 2014, compared to net income of $10.05 million on $8.41
million of total revenue during the prior year.
The Company's balance sheet at June 30, 2014, showed $4.04 million
in total assets, $15.40 million in total liabilities and a $11.35
million total deficiency.
A copy of the Form 6-K is available for free at:
http://is.gd/EDekKF
Annual Meeting
The Company will hold an annual general meeting on Oct. 27, 2014,
at 10:00 am (WST) at BDO, 38 Station Street, Subiaco, Perth,
Western Australia, to consider approval of the following items:
1. Adoption of remuneration report;
2. Re-election of director Guy Burnett;
3. Re-election of director Datuk Mohamed Zain Bin Mohamed
Yusuf;
4. Re-election of director James Garton
5. Re-election of director Mohd Azlan Bin Mohammed;
6. Issue of Shares to Executive Directors in lieu of cash
bonus;
7. Approval of 10% Placement Facility; and
8. Reduction of share capital.
A copy of the Notice is available for free at:
http://is.gd/wAWDy2
About Mission NewEnergy
Based in Subiaco, Western Australia, Mission NewEnergy Limited is
a producer of biodiesel that integrates sustainable biodiesel
feedstock cultivation, biodiesel production and wholesale
biodiesel distribution focused on the government mandated markets
of the United States and Europe.
The Company is not operating its biodiesel refining segment. The
refineries are being held in care and maintenance either awaiting
a return to positive operating conditions or the sale of assets.
The Company has materially diminished its Jatropha contract
farming operation and the company is now focused on divesting the
remaining Indian assets. The Company intends to cease all Indian
operations.
BDO Audit (WA) Pty Ltd, in Perth, Western Australia, issued a
"going concern" qualification on the consolidated financial
statements for the year ended June 30, 2013. The independent
auditors noted that the Company incurred operating cash outflows
of $3.7 million during the year ended 30 June 2013 and, as of that
date the consolidated entity's total liability exceeded its total
assets by $12.5 million. These conditions, along with other
matters, raise substantial doubt the Company's ability to continue
as a going concern.
QANTAS AIRWAYS: Close To Engineers Pay Deal as Part of Cost Cut
---------------------------------------------------------------
Matt O'Sullivan at The Sydney Morning Herald reports that one of
the Qantas unions at the centre of the 2011 industrial dispute
that grounded the airline is close to an agreement on a new four-
year deal that includes a pay freeze for the first 18 months.
SMH says the likelihood of a settlement is a significant step
towards achieving the goal of Qantas chief executive Alan Joyce to
freeze pay across the company as part of efforts to strip
AUD2 billion in costs from the business within three years.
According to the report, the licensed aircraft engineers' union
believes its members are likely to accept an in-principle deal
reached with Qantas for a new enterprise agreement covering about
1,500 staff.
As part of a side deal, about 65 engineers who were forced to take
redundancy this year would have the chance to return to work at
Qantas, SMH relates.
Following the forced redundancies, the union launched legal action
in the Federal Court against Qantas for allegedly breaching the
consultation provisions of the Fair Work Act. However, it has
agreed to drop the legal action if the 65 engineers are re-
employed, SMH says.
The report notes that the union has given its nod of approval to a
pay freeze for the first 18 months of an agreement, after which
its members would gain a 3 per cent annual wage increase.
According to SMH, Steve Purvinas, the federal secretary of the
Australian Licensed Aircraft Engineers Association, has told union
members that they could fight for a pay rise but "we expect that
the government would intervene again and order us to Fair Work
Australia for them to determine our pay outcome".
"This process would be lengthy and it would be difficult to
convince Fair Work that we should achieve a greater outcome than
others," he wrote in a newsletter, SMH relays.
SMH relates that Mr. Purvinas said September 30 he was confident
the union's members at Qantas would vote in favour of the proposed
agreement, which includes a deal for staff to take accrued holiday
leave before the company opted for further redundancies.
Qantas engineers have on average about six months of accrued
leave, the report notes.
"Our organisation recognises the need for Qantas to have smooth
sailing over the next couple of years and we want to be a part of
that and a part of Qantas' rebuilding," the report quotes Mr.
Purvinas as saying. "In return, we trust that Qantas will respect
our position in engineering."
The union will begin polling members on the in-principle agreement
next Tuesday [October 7], which will take about 10 days. If
accepted, the new agreement would begin on January 1.
SMH further says that despite the breakthrough with the engineers,
talks with the Transport Workers Union, which represents about
2000 Qantas ground staff whose three-year agreement expired on
July 1, are showing no signs of a resolution.
Qantas also remains in negotiations with the Australian and
International Pilots Association over new enterprise bargaining
agreements covering long and short-haul pilots, SMH reports.
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.
The TCR-AP reported on Jan. 27, 2014, that Standard & Poor's
Ratings Services affirmed its 'BB+' long-term issue rating on
Qantas Airways Ltd.'s senior unsecured debt, in line with the
corporate credit rating. At the same time, S&P assigned a
recovery rating of'3', indicating its expectation of meaningful
(50%-70%) recovery for creditors in the event of a payment
default. S&P has also removed the senior unsecured debt from
CreditWatch with negative implications, where it was placed on
Dec. 5, 2013.
RESIMAC VERSAILLES: S&P Assigns BB Rating to Class E Notes
----------------------------------------------------------
Standard & Poor's Ratings Services assigned its ratings to six
classes of prime residential mortgage-backed securities (RMBS)
issued by The New Zealand Guardian Trust Co. Ltd. as trustee of
the RESIMAC Versailles Trust - RESIMAC Versailles Trust Series
2014-1.
The ratings reflect:
-- S&P's view of the credit risk of the underlying collateral
portfolio, including the fact that this is a closed
portfolio, which means no further loans will be assigned to
the trust after the closing date.
-- S&P's view that the credit support is sufficient to
withstand the stresses it applies. This credit support
comprises note subordination and lenders' mortgage
insurance policies.
-- S&P's expectation that the various mechanisms to support
liquidity within the transaction, including an externally
fully funded yield-enhancement reserve on closing, an
amortizing liquidity facility equal to 3.0% of the initial
aggregate amount of the notes, and principal draws are
sufficient under S&P's stress assumptions to ensure timely
payment of interest on the rated notes.
-- The benefit of a fixed-to-floating interest-rate swap to be
provided by Westpac Banking Corp. to hedge the mismatch
between receipts from any fixed-rate mortgage loans and the
variable-rate RMBS.
The issuer has informed Standard & Poor's (Australia) Pty Limited
that the issuer will be publically disclosing all relevant
information about the structured finance instruments that are
subject to this rating report.
STANDARD & POOR'S 17G-7 DISCLOSURE REPORT
SEC Rule 17g-7 requires an NRSRO, for any report accompanying a
credit rating relating to an asset-backed security as defined in
the Rule, to include a description of the representations,
warranties and enforcement mechanisms available to investors and a
description of how they differ from the representations,
warranties and enforcement mechanisms in issuances of similar
securities.
The Standard and Poor's 17g-7 Disclosure Report included in this
credit rating report is available at:
http://standardandpoorsdisclosure-17g7.com/2728.pdf
REGULATORY DISCLOSURES
Please refer to the initial rating report for any additional
regulatory disclosures that may apply to a transaction.
RATINGS ASSIGNED
Class Rating Amount (mil. NZ$)
A1 AAA (sf) 115.50
A2 AAA (sf) 15.60
B AA (sf) 5.70
C A (sf) 4.95
D BBB (sf) 3.45
E BB (sf) 2.10
F N.R. 2.70
N.R.--Not rated.
T AND A MORRISSY: Placed in Administration
------------------------------------------
Cliff Sanderson at Dissolve.com.au reports that T and A Morrissy
Investments Pty. Ltd. has been placed into administration.
Jason Glenn Stone and Petr Vrsecky of PKF Lawler Melbourne have
been appointed as administrators of the company on Sept. 19, 2014,
according to Dissolve.com.au.
The company's creditors are set to meet on October 1, the report
says.
===============
C A M B O D I A
===============
CAMBODIA: S&P Affirms Then Withdraws 'B' Sovereign Credit Rating
----------------------------------------------------------------
Standard & Poor's Ratings Services affirmed its unsolicited 'B'
long-term and short-term sovereign credit ratings on the Kingdom
of Cambodia. The outlook on the long-term rating is stable. At
the same time, S&P affirmed its unsolicited 'axBB-' long-term and
'axB' short-term ASEAN regional scale ratings on Cambodia. S&P's
transfer and convertibility (T&C) assessment is 'B+'.
S&P then withdrew its ratings on Cambodia due to insufficient
market interest.
RATIONALE
The ratings on Cambodia prior to the withdrawal took into account
the country's weak policy institutions, low-income economy, non-
transparent policymaking environment, and limited monetary
flexibility. These constraints are weighed against healthy growth
prospects, strong inflows of foreign direct investments, as well
as substantial donor engagement that keep government debt and
interest burden low.
Cambodia's centralized political system, coupled with non-
transparent policymaking, was a major rating constraint. Tension
between the ruling Cambodian People's Party (CPP) and the
opposition Cambodia National Rescue Party (CNRP) escalated after
the 2013 elections due to allegations of fraud. Although
hostilities have subsided recently with a power-sharing deal,
relations between the two parties are likely to remain volatile
over disagreements on policymaking and key political appointments.
Cambodia's economy with its low average income, which S&P
projected at US$1,088 for 2014, further constrains policy
flexibility in the event of an economic or financial shock.
The absence of an independent monetary policy framework, owing to
extensive use of the U.S. dollar, severely hampers monetary policy
flexibility. Foreign currency deposits account for more than 80%
of broad money supply, leaving the central bank with setting bank
reserve requirements as the main policy tool.
Cambodia's record of stable growth with its generally market-
oriented economic policies supports the ratings. S&P believes its
medium-term growth prospects are favorable with further expansions
of the tourism and garment sectors. S&P projects real per capita
growth of about 5.5% over the next three to five years.
The continued engagement of international donors also underpins
the ratings. This support conditions policy formulation and
provides substantial fiscal and balance-of-payments assistance
through concessional loans and grants. Together with its modest
net debt level of an estimated 27.5% of GDP in 2014, donor support
has afforded Cambodia a very low interest burden of 2.2% of
general government revenues.
Cambodia's external position is adequate, with estimated average
gross external financing needs for 2014-2017 at approximately 90%
of current account receipts plus usable reserves and its narrow
net external debt at 8%.
OUTLOOK
The stable outlook at the time of withdrawal incorporated S&P's
expectation of policy continuity and donor support.
In accordance with S&P's relevant policies and procedures, the
Rating Committee was composed of analysts that are qualified to
vote in the committee, with sufficient experience to convey the
appropriate level of knowledge and understanding of the
methodology applicable. At the onset of the committee, the chair
confirmed that the information provided to the Rating Committee by
the primary analyst had been distributed in a timely manner and
was sufficient for Committee members to make an informed decision.
After the primary analyst gave opening remarks and explained the
recommendation, the Committee discussed key rating factors and
critical issues in accordance with the relevant criteria.
Qualitative and quantitative risk factors were considered and
discussed, looking at track-record and forecasts.
The committee agreed that no key rating factors had changed.
The chair ensured every voting member was given the opportunity to
articulate his/her opinion. The chair or designee reviewed the
draft report to ensure consistency with the Committee decision.
The views and the decision of the rating committee are summarized
in the above rationale and outlook. The weighting of all rating
factors is described in the methodology used in this rating
action.
RATINGS LIST
Ratings Affirmed; Withdrawn
To From
Cambodia (Kingdom of) (Unsolicited Ratings)
Sovereign Credit Rating NR B/Stable/B
ASEAN Regional Scale NR axBB-/--/axB
NR--not rated.
=========
C H I N A
=========
CIFI HOLDINGS: S&P Revises Outlook to Pos. & Affirms 'B+' CCR
-------------------------------------------------------------
Standard & Poor's Ratings Services revised the rating outlook on
China-based property developer CIFI Holdings (Group) Co. Ltd. to
positive from stable. At the same time, S&P affirmed its 'B+'
long-term corporate credit rating on CIFI and the 'B' issue rating
on the company's outstanding senior unsecured notes. S&P also
affirmed the 'cnBB' long-term Greater China regional scale rating
on CIFI and the 'cnBB-' rating on the notes.
"We revised CIFI's outlook to reflect our view of the company's
increasing operating scale, good sales execution despite a
generally sluggish market, and steady profitability," said
Standard & Poor's credit analyst Dennis Lee. "In our view, these
factors could reduce the company's business risks and lead us to
raise the rating over the next 12 months. At the same time, we
expect CIFI to manage its leverage with caution."
S&P believes CIFI can maintain its strong sales growth in 2014 and
2015. In the first six months of 2014, the company achieved
contract sales of Chinese renminbi (RMB) 10.2 billion, up 43% year
over year, even though the overall property market declined. In
S&P's opinion, the strong sales performance is attributable to
CIFI's flexible pricing, product positioning in the mass-market
segment, and strategic focus on tier-one and certain tier-two
cities, where end-user demands remains robust. In S&P's base-case
scenario, it estimates that CIFI's contract sales will reach about
RMB20 billion in 2014 and RMB24 billion-RMB25 billion in 2015.
"We anticipate that CIFI will maintain good operating efficiency
while expanding its scale," Mr. Lee said. "Over the past two
years, CIFI has shown good execution capabilities under a fast-
asset-turnover model, with high cash collection and sell-through
rates. Its sell-through ratio in 2013 was about 70%, compared
with the industry average of 50%-60%. Although the ratio is
likely to drop as the operating scale continues to expand, we
believe that the company can maintain a sell-through rate at an
above-average level."
S&P believes CIFI will maintain its leverage at the current level
over the coming 12 months, to support its rapid expansion. In
addition, the company's total borrowings should grow in line with
sales. CIFI has a track record of maintaining its debt leverage
and cash flow coverage ratios while enlarging its scale over the
past two years.
Nevertheless, S&P expects CIFI's financing costs to gradually
improve. The company is replacing high-cost trust financing with
funds raised from its senior notes and syndication loans in the
offshore market. S&P expects this trend to continue to lower the
overall funding costs and extend the company's debt maturities.
Because of the shift in funding channels, CIFI's effective
interest rate decreased to 8.7% in the first half of 2014 from
over 10% in 2012.
S&P views the execution risk on a recently acquired land parcel in
Shanghai as higher than for its other projects. That is because
of the large land costs totaling RMB4.2 billion, as well as the
project nature of the largely commercial project in the center of
a top-tier city. CIFI's record of operating a similar project is
limited. Nevertheless, S&P understands that the company plans to
introduce strategic investors to share the financing burden.
Including this project, CIFI's total spending on land in the year
to date is still within our expectation.
S&P affirmed the ratings to reflect its view of CIFI's growth
appetite and "aggressive" financial risk profile, the execution
risk attributable to its rapid expansion, and the company's
relatively short track record of prudent financial management.
CIFI's good execution record, enhanced financial flexibilities
with lower funding costs and longer debt maturities, and good
market position in the Shanghai market temper these weaknesses.
The positive outlook reflects S&P's view that CIFI will sustain
strong execution of its fast-asset-turnover model, generate robust
property sales, and maintain its profit margin over the next 12
months. S&P also anticipates that the company will continue to
manage its leverage and balance sheet while expanding.
S&P could raise the rating if CIFI maintains strong sales
execution, despite the sluggish industry outlook, such that the
company continues to improve its scale and diversity. At the same
time, CIFI would show consistent financial management and keep its
debt-to-EBITDA ratio at 4x-5x.
S&P could revise the rating to stable if: (1) CIFI's sales
execution is weaker than it expects, such that its contract sales
in 2014 are substantially below S&P's base-case estimate of about
RMB20 billion; or (2) the company's EBITDA margin is materially
lower than 25%.
TEXHONG TEXTILE: S&P Affirms 'BB-' CCR; Outlook Stable
------------------------------------------------------
Standard & Poor's Ratings Services said that it had affirmed its
'BB-' long-term corporate credit rating on China-based textile
company Texhong Textile Group Ltd. The outlook is stable. S&P
also affirmed its long-term Greater China regional scale rating on
Texhong at 'cnBB+'. At the same time, S&P affirmed its 'BB-'
long-term issue rating and 'cnBB+' long-term Greater China
regional scale rating on the company's outstanding senior
unsecured notes.
"We affirmed the ratings on Texhong because we expect the
company's profitability to remain volatile over the next 12
months, due to continued volatility in cotton prices," said
Standard & Poor's credit analyst Joe Poon. "Further, the core-
spun yarn market remains highly fragmented and competitive."
In addition to an uncertain global economic outlook, the company
is increasingly subject to high country risk in Vietnam. These
factors constrain Texhong's business risk profile, which S&P
assess as "fair."
Nevertheless, S&P expects Texhong to maintain moderate financial
leverage and satisfactory revenue growth over the next 12 months.
S&P also expects the company to maintain its strong market
position in core-spun yarns and to achieve cost advantages after
expanding its operations in Vietnam, where spindle capacity is
likely to reach nearly 50% of total capacity in 2014.
S&P estimates the company's EBITDA margin could fall to 11%-13%
from 16.3% in 2013 over the next 12 months. But the cost
advantages from Texhong's Vietnamese operations and its
established market position in China mitigate the risk.
Texhong is maintaining its market position in the core-spun yarn
market in China due to its increasing production capacity. S&P
estimates the company has about 30% market share in China, with
spindle capacity of about 1.9 million in the first half of 2014.
This niche market continues to grow at a healthy rate, supported
by growing demand for the company's products in China, where it
has a diverse customer base and a good distribution network.
In S&P's view, Texhong's financial management will provide a
buffer for the company to weather the volatile business
environment as its capital expenditure is likely to reduce in the
next two years. S&P expects Texhong's ratio of total debt to
EBITDA to be 2.8x-3.3x over the next 12 months. While S&P's
rating on Texhong incorporates some margin and earnings
volatility, the rating could come under pressure if the margin
materially deteriorates. Accordingly, S&P continues to assess
Texhong's financial risk profile as "aggressive."
"The outlook is stable, reflecting our expectation that Texhong
will improve its leverage over the next 12 months after the
completion of its Vietnam expansion," said Mr. Poon. "We also
anticipate that profitability will be flat, after deteriorating
this year, due to lower domestic cotton and yarn prices and
compressed margins in Vietnam."
Despite that, S&P believes Texhong can maintain a ratio of debt to
EBITDA below 3.5x over the next 12 months, which is well below
S&P's downgrade trigger.
S&P could lower the rating if Texhong's profitability and
financial risk profile materially deteriorate. This could happen
if: (1) the company engages in larger debt-funded expansion than
we expect; (2) cotton and yarn prices severely fluctuate,
affecting profitability and causing the EBITDA margin to be
significantly below 10%; or (3) textile demand weakens because of
an economic slowdown. A ratio of debt to EBITDA exceeding 4.5x on
a continued basis could trigger a downgrade.
The rating upside is limited over the next 12 months. S&P could
raise the rating if Texhong can: (1) achieve a more stable
financial performance across down cycles, which could happen if
the company expands into less-volatile downstream businesses; and
(2) shows a disciplined approach toward debt-funded expansion and
adopts prudent financial policies. A ratio of debt to EBITDA
consistently below 2.5x could trigger an upgrade.
===============
H O N G K O N G
===============
EADGEAR HOLDINGS: U.S. SEC Files Charges Over Pyramid Scheme
------------------------------------------------------------
The Securities and Exchange Commission has announced charges
against the operators of an international pyramid scheme that
raised more than $129 million from investors worldwide, primarily
in the U.S., China, and Taiwan. The case follows another against
a separate pyramid scheme that lured investors in the U.S., China,
and Korea with seminars, webinars, and YouTube videos.
The newest case, filed in federal court in San Francisco, charges
Hong Kong-based eAdGear Holdings Limited and California-based
eAdGear, Inc., along with operators Charles S. Wang and Qian Cathy
Zhang, of Warren, N.J., and Francis Y. Yuen, of Dublin, Calif.
According to the SEC complaint, even though eAdGear claimed to be
a successful Internet marketing company, nearly all of its revenue
was generated by investors, not its products or services.
The complaint alleges that eAdGear's operators used money from new
investors to pay earlier investors as well as to repay a personal
loan and purchase million-dollar homes for themselves. It alleges
the operators concealed and perpetuated the scheme by displaying
sham websites on eAdGear's own site to make it appear as if it had
real, paying customers and manipulated revenue distributions to
investors toappear profitable.
"eAdGear and its operators falsely claimed that they were running
a profitable Internet marketing company when in reality, they were
operating a Ponzi and pyramid scheme that preyed on Chinese
communities and caused investors to lose millions of dollars,"
said Jina L. Choi, director of the SEC's San Francisco Regional
Office.
The eAdGear case follows one filed in federal court in Georgia
against Zhunrize Inc. and CEO Jeff Pan for allegedly defrauding
investors of more than $105 million since 2012. Despite its
claims to be a legitimate multi-level marketing company, Zhunrize
derived most of its funds from selling memberships, not products,
according to the SEC complaint.
"Zhunrize claimed to offer investors the opportunity to be an
'e-commerce Business Owner' selling products to customers through
a website. In fact, it was a pyramid and 'profits' came from fees
paid by later investors," said William Hicks, associate regional
director of the SEC's Atlanta Regional Office.
In both cases, the courts granted the SEC's request for an asset
freeze and issued a temporary restraining order. In the case of
eAdGear, that order bars the defendants from soliciting investors,
including through websites they have used until now
www.eadgear.com, www.eadgear.net, www.winteam777.com, and
www.winteam168.com. A court hearing has been scheduled for
October 10.
Jessica W. Chan, John A. Roscigno, and Jason M. Habermeyer of the
SEC's San Francisco Regional Office conducted the eAdGear
investigation. Erin E. Schneider and Cary S. Robnett supervised
theinvestigation. Ms. Chan and Susan F. LaMarca will lead the
SEC's litigation. The SEC appreciates the assistance of the
United States Attorney's Office for the Northern District of
California and the Federal Bureau of Investigation. It also
appreciates the assistance of the Hong Kong Securities and Futures
Commission, the China Securities Regulatory Commission, the
Ontario Securities Commission, and the Financial Conduct Authority
in the United Kingdom.
Michael E. Mashburn and Kristin Wilhelm of the SEC's Atlanta
Regional Office conducted the Zhunrize investigation, supervised
by Peter J. Diskin. Ms. Wilhelm is leading the SEC's litigation.
GREENLAND HK: S&P Revises Outlook to Neg, Affirms BB+ Note Rating
-----------------------------------------------------------------
Standard & Poor's Ratings Services said that it had revised the
outlook on Greenland Hong Kong Holdings Ltd. (Greenland HK) to
negative from stable. At the same time, S&P affirmed the 'BBB-'
long-term corporate credit rating on Greenland HK and the 'BB+'
issue rating on its outstanding senior unsecured notes. S&P also
lowered its long-term Greater China regional scale rating on
Greenland HK to 'cnBBB+' from 'cnA-' and the issue rating on the
notes to 'cnBBB' from 'cnBBB+'. Greenland HK is a Hong Kong-based
offshore investment holding company of Greenland Group.
"We revised our outlook on Greenland HK to negative from stable to
reflect our outlook revision earlier today on the company's
parent, Greenland Holding Group Co. Ltd. (Greenland Group:
BBB/Negative/--; cnA-/--)," said Standard & Poor's credit analyst
Matthew Kong. "We revised the outlook on the parent due to its
increasing leverage. The rating and outlook on Greenland HK are
linked to those on Greenland Group."
The rating on Greenland HK is one notch below that on the parent
because S&P views Greenland HK as a "highly strategic" but not a
"core" subsidiary of Greenland Group. S&P expects Greenland Group
to remain Greenland HK's controlling shareholder. Greenland HK's
role as an offshore financing and investment platform for onshore
projects supports its status within the group. Greenland Group is
likely to control the management and operations of Greenland HK.
"We believe Greenland Group's weakened financial risk profile will
have a direct impact on Greenland HK's credit profile, given the
subsidiary's reliance on parental support," said Mr. Kong. S&P
anticipates that Greenland HK's financial risk profile will remain
"highly leveraged" because of the company's aggressive growth
appetite. S&P anticipates that Greenland HK's leverage will
remain high over the next two years. This is largely due to the
company's aggressive debt-funded expansion and large capital
expenditure for accelerated construction and land acquisitions.
S&P's view of the company's "weak" business risk profile reflects
its small operating scale and weak profitability. However, S&P
expects Greenland HK to enlarge its operating scale significantly
over the next five years as it benefits from the brand association
and strong support from the parent group.
The issue rating is one notch lower than the corporate credit
rating on Greenland HK, reflecting structural subordination.
The negative outlook on Greenland HK reflects the outlook on
Greenland Group. The negative outlook on Greenland Group reflects
S&P's expectation that the group's leverage will remain high over
the next 12-24 months.
S&P may lower the rating on Greenland HK if it downgrades
Greenland Group. S&P may also lower the rating if: (1) it
believes that Greenland HK's importance within Greenland Group has
weakened because of a change in Greenland Group's strategy; or (2)
Greenland Group's control and supervision of Greenland HK weakens.
S&P may revise Greenland HK's outlook to stable if it revises the
outlook on Greenland Group.
=========
I N D I A
=========
A POWER: ICRA Suspends 'D' Rating on INR17.6cr Fund Based Loan
--------------------------------------------------------------
ICRA has suspended [ICRA]D rating assigned to the INR17.60 crore
fund based facilities of A Power Himalayas Limited. The suspension
follows ICRA's inability to carry out a rating surveillance in the
absence of the requisite information from the company.
AGRAWAL OIL: ICRA Reaffirms 'B' Rating on INR10cr Cash Credit
-------------------------------------------------------------
ICRA has reaffirmed the [ICRA]B rating to INR10.00 crore long term
cash credit facility of Agrawal Oil and General Industries.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long Term, Fund based 10.00 [ICRA]B reaffirmed/assigned
limits Cash Credit
The rating reaffirmation takes into account substantial experience
of promoters in cotton seed oil business with established
relations with customers and easy availability of raw material by
virtue of favourable location. The rating is however constrained
by leveraged capital structure and weak coverage indicators due to
working capital intensive nature of operations and low profit
margins in line with low value adding nature of business. ICRA
also takes note of modest scale of operations in an intensely
competitive industry and vulnerability associated with agro
climatic conditions which has direct bearing on profitability of
the firm. Going forward, scaling up operations while managing
inventory levels, remains key rating sensitivity.
Established in 1982, AOGI is a partnership firm promoted by Mr.
Sanjay Agrawal. The firm is engaged in crushing of cotton seeds to
produce cotton seed wash oil and cotton seed cake. The
manufacturing facility of the firm is located in Amravati district
of Maharashtra with an installed crushing capacity of 100 quintal
per day.
AKS ALLOYS: ICRA Revises Rating on INR15cr Fund Based Loan to 'B'
-----------------------------------------------------------------
ICRA has revised the long-term rating outstanding on the INR15.00
crore fund based facilities of AKS Alloys Private Limited to
[ICRA]B from [ICRA]B+. ICRA has reaffirmed the short-term rating
of [ICRA]A4 outstanding on the INR5.00 crore fund based (sub-
limit) facility and the INR10.00 crore non-fund based facility of
AAPL.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Fund based facilities 15.00 Revised to [ICRA]B
from [ICRA]B+
Fund based (sub-limit (5.00) [ICRA]A4 reaffirmed
facility
Non-fund based facility 10.00 [ICRA]A4 reaffirmed
The revision in ratings considers the sharp decline in revenue
during 2013-14, due to the suspension of the company's operations
for more than eight months on account of non-availability of
labour. The ratings also consider the Company's stretched coverage
metrics, its exposure to the cyclicality inherent in the steel
industry, and the high competition in the fragmented and
commoditised steel ingots manufacturing and scrap trading business
which restricts pricing flexibility. AAPL's accruals are also
vulnerable to sharp unfavourable movements in foreign exchange
rates, in the absence of hedging. While the ongoing weakness in
the steel industry is expected to impact the Company's revenue
growth and accruals at least in the near term, the long-term
demand outlook for steel products remain favourable. The ratings
also consider the experience of promoters of over two decades in
the steel industry.
Incorporated in 2000, AAPL is primarily engaged in manufacturing
steel ingots and trading steel scrap / ingots. The Company
operates a steel ingot manufacturing facility, with a capacity of
18,000 TPA, at Pondicherry.
The Company is closely held and managed by the promoter group,
mainly comprising Mr. Sanjay Kumar Sharma and Mr. Nemi Chand
Kothari. The Company holds 80% equity stake in SAR Ispat Private
Limited, which is primarily engaged in manufacturing steel billets
at Pondicherry with a capacity of 36,000 TPA.
Recent results
The Company reported a net profit of about INR0.3 crore on an
operating income of INR25.0 crore during 2013-14 (according to
unaudited results) against a net profit of INR0.6 crore on an
operating income of INR91.5 crore during 2012-13.
AYURSUNDRA HEALTH: CRISIL Reaffirms B+ Rating on IN441.9MM Loan
---------------------------------------------------------------
CRISIL's ratings on the bank facilities of Ayursundra Health Care
Pvt Ltd continue to reflect AHPL's exposure to risk related to the
implementation of its on-going project, and its limited track
record of operations. These rating weaknesses are partially offset
by the benefits AHPL derives from its promoters' strong background
in the healthcare industry and their financial support to fund the
business operations.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Cash Credit 4 CRISIL B+/Stable (Reaffirmed)
Proposed Long Term
Bank Loan Facility 14.1 CRISIL B+/Stable (Reaffirmed)
Term Loan 441.9 CRISIL B+/Stable (Reaffirmed)
For arriving at the ratings, CRISIL has treated the unsecured
loans of INR68 million as on March 31, 2014 as neither debt nor
equity as the same are subordinated to bank debt and are interest
free.
Outlook: Stable
CRISIL believes that AHPL will continue to benefit over the medium
term from its promoters' extensive industry experience and their
funding support. The outlook may be revised to 'Positive' in case
the company successfully implements its on-going project within
the budgeted cost along with higher-than-expected cash accruals,
leading to improvement in its debt-protection metrics. Conversely,
the outlook may be revised to 'Negative' in case of time or cost
overrun in the project, or lower-than-expected equity infusion for
its capital expenditure programme, leading to deterioration in the
financial risk profile, resulting in pressure on its liquidity.
AHPL, incorporated in 2007, commenced commercial operations in
October 2010. AHPL runs a diagnostic center, which provides a wide
range of non-invasive diagnostic and other healthcare services in
Guwahati. AHPL is also operating a cardiac unit with ICU facility
with 12 beds since April 2012. The company plans to start a multi-
specialty hospital and rejuvenation center over the medium term.
The company is promoted by Mr. Simanta Das (Mr. Das) and Dr.
Abhijit Hazarika (Dr. Hazarika).
BRAHMA REFRACTORIES: CRISIL Ups Rating on INR60MM Cash Loan to B+
-----------------------------------------------------------------
CRISIL has upgraded its ratings on the bank facilities of Brahma
Refractories Pvt Ltd to 'CRISIL B+/Stable/CRISIL A4' from 'CRISIL
D/CRISIL D'.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Bank Guarantee 20 CRISIL A4 (Upgraded from
'CRISIL D')
Cash Credit 60 CRISIL B+/Stable (Upgraded
from 'CRISIL D')
Proposed Long Term 8.8 CRISIL B+/Stable (Upgraded
Bank Loan Facility from 'CRISIL D')
The ratings have been upgraded due to substantial improvement in
BRPL's liquidity stemming from complete repayment of its term
loans. Large maturing debt obligations were earlier constraining
the company's liquidity; with the complete repayment of term loans
and absence of any capital expenditure (capex), the company's
accruals, estimated at over INR10 million annually, are being
utilised for funding its working capital requirements leading to
improvement in liquidity. The upgrade also factors in the
company's stable business risk profile marked by steady revenues
of INR140 million to INR150 million and operating margin of 14 to
15 per cent and a comfortable financial risk profile, with gearing
of about 1 time and moderate debt protection indicators.
The ratings reflect the modest scale of operations and working-
capital-intensive operations. These weaknesses are partially
offset by the extensive experience of BRPL's promoters in the
refractory business and improving financial risk profiles.
Outlook: Stable
CRISIL believes that BRPL will continue to benefit from its
extensive experience in the refractory industry. The outlook may
be revised to 'Positive' if the company reports higher-than-
expected sales supported by stable operating margin and reducing
working capital cycle. Conversely, the outlook may be revised to
'Negative' if it reports further decline in working cycle or if
the company undertakes large debt-funded capex or reports
substantial decline in operating margin leading to increased
pressure on its financial risk profile.
Incorporated in 2005, BRPL was set up by Mr. Surendra Kumar Sinha
and is situated in Dhanbad (Jharkhand). It manufactures refractory
bricks, refractory mortars, and high alumina castables.
BRPL is expected to report profit after tax (PAT) of INR2.6
million on net sales of INR141 million for 2013-14 against PAT of
INR2.3 million on net sales of INR140 million for 2012-13.
CANDOR BIOTECH: ICRA Assigns B+ Rating to INR5.75cr Working Loan
----------------------------------------------------------------
ICRA has assigned its long term rating of [ICRA]B+ and short term
rating of [ICRA]A4 to the INR7.0 crore bank facilities of Candor
Biotech Limited.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Fund Based Working 5.75 [ICRA]B+ Assigned
Facilities
Non Fund Based
Facilities 0.60 [ICRA]A4 Assigned
Term Loans 0.20 [ICRA]B+ Assigned
Unallocated 0.45 [ICRA]B+ Assigned
The ratings take into account the extensive experience of the
promoters in the pharmaceuticals industry; the promoters'
experience spans nearly three decades and includes the management
of two pharmaceutical companies, CBL and Japshichem
Pharmaceuticals, for more than a decade. The ratings also factor
in the company's strong pan-India distribution network of more
than 250 distributors to sell its products under its own brand.
Further, ICRA also notes the high utilization of CBL's plant
capacities, which are running at a utilization of more than 90%.
The ratings, however, are constrained by CBL's weak financial
profile, with a gearing of 2.4x as on March 31, 2014, with 90% of
debt being short term in nature, and continued need of large
working capital loans to fund the stretched working capital cycle.
Further, despite healthy growth in sales over the last three
years, the overall scale of operations remains modest. Going
forward, CBL's ability to sustain revenue growth, while
maintaining profit margins and optimally funding its working
capital requirements, will remain the key rating sensitivities.
CBL was set up by Mr. Amarjit Singh, along with other promoters,
in 2002 and manufactures formulations such as tablets, capsules,
oral liquids, dry syrups, liquids and ointments. The company
started commercial operations from a plant in Punjab in 2002 and
shifted to Solan, Himachal Pradesh in 2006. The company sells its
pharmaceutical products through its own pan-India distribution
network of 250 distributors covering every state of the country.
The company also has a sister concern, JapshiChem Pharmaceuticals
operating in the same line of business since 2007.
Recent Results
In 2013-14, as per provisional financials, CBL reported Operating
Income of INR19.2 crore, Profit before Depreciation, Interest and
Tax (PBDIT) of INR1.4 crore and net profit of INR0.2 crore.
CHINTAMANI SHARMA: ICRA Revises Rating on INR4cr FB Limits to 'B'
-----------------------------------------------------------------
ICRA has revised its long term rating on the INR4.00 crore fund
based limits of Chintamani Sharma and Sonsto [ICRA]B from [ICRA]B+
and has reaffirmed the short term rating on the company's INR6.00
crore non fund based limits at [ICRA]A4.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Fund based limits 4.00 Revised to [ICRA]B from
[ICRA]B+
Non fund based limits 6.00 [ICRA]A4 reaffirmed
The rating revision is driven by the stretched liquidity position
of the firm as reflected in high utilisation of its bank limits.
Further, the ratings continue to be constrained by the firm's
modest scale of operations, low profitability margins due to
limited value additive nature of operations and the intensely
competitive nature of the industry and modest debt coverage
indicators of the firm. Moreover CMSS is a partnership firm and
any significant withdrawals from the capital account could
adversely impact its net worth and thereby the capital structure.
Nevertheless, the ratings derive comfort from the long experience
of the promoters in the copper wire industry, favourable long term
demand outlook for the firm's products and its diversified
customer base. Going forward, the ability of the firm to increase
its scale of operations in a profitable manner while maintaining
working capital intensity at optimal levels will be the key rating
sensitivities.
CMSS was established in the year 1981 as a proprietorship firm and
was converted into a partnership firm in 1983-84. The firm is
engaged in manufacturing of copper wires. Its manufacturing
facility is located at Jhilmil in Delhi.
The firm reported, on a provisional basis, a net profit of INR0.35
crore on an operating income of INR30.99 crore in 2013-14 as
against net profit of INR0.29 crore on an operating income of
INR30.88 crore in the previous year.
CICB-CHEMICON PVT: CRISIL Cuts Rating on INR454.8MM Loan to 'D'
--------------------------------------------------------------
CRISIL has downgraded its ratings on the bank facilities of
CICB-Chemicon Pvt Ltd to 'CRISIL D/CRISIL D' from 'CRISIL BB-
/Negative/CRISIL A4+'. The rating downgrade reflects CICB-
Chemicon's continuously overdrawn cash credit facility; this has
been due to the company's weak liquidity
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Bank Guarantee 80 CRISIL D (Downgraded from
'CRISIL A4+')
Cash Credit 30 CRISIL D (Downgraded from
'CRISIL BB-/Negative')
Letter of Credit 95 CRISIL D (Downgraded from
'CRISIL A4+')
Packing Credit 22.5 CRISIL D (Downgraded from
'CRISIL BB-/Negative')
Proposed Long Term 454.8 CRISIL D (Downgraded from
Bank Loan Facility 'CRISIL BB-/Negative')
The ratings also reflect the company's weak financial risk
profile, marked by weak debt protection metrics, and its small
scale of, and working-capital-intensive, operations, which
constrains its operating efficiency. These rating weaknesses are
partially offset by the benefits that CICB-Chemicon derives from
its technology tie-ups with global players, FS-Elliott Co LLC
(USA) and Hangzhou-Chinen Steam Turbine Power Co Ltd (China).
CICB-Chemicon, established in 1971 and based in Bengaluru,
primarily manufactures engineering goods, including compressors,
heat exchangers, and pressure vessels.
DASARI VEER: CRISIL Ups Rating on INR107.6MM Term Loan to 'B-'
--------------------------------------------------------------
CRISIL has upgraded its rating on the bank facilities of Dasari
Veer Raju & Gunnam Ramchandra Rao & Memorial Trust (DVR) to
'CRISIL B-/Stable' from 'CRISIL D'.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Proposed Long Term 22.9 CRISIL B-/Stable (Upgraded
Bank Loan Facility from 'CRISIL D')
Term Loan 107.6 CRISIL B-/Stable (Upgraded
from 'CRISIL D')
The rating upgrade reflects DVR's timely servicing of its debt
obligations, supported by its improved liquidity, with enhanced
cash accruals vis-a-vis its debt obligations, and the trustees'
consistent funding support. The rating also factors in CRISIL's
belief that DVR will sustain its adequate cash accruals vis-a-vis
its debt obligations, over the medium term.
The rating reflects below-average financial risk profile, marked
by its small net worth and high gearing; moreover, the trust is
exposed to regulatory risks inherent to education institutes.
However, DVR benefits from healthy demand prospects for the
education sector and the promoters' extensive industry experience.
Outlook: Stable
CRISIL believes that DVR will continue to benefit from healthy
demand prospects for the education sector, over the medium term.
The outlook may be revised to 'Positive' if the trust improves its
cash accruals with an enhanced scale of operations commensurate
with enrolments at its institutes. Conversely, the outlook may be
revised to 'Negative' if DVR's liquidity or financial risk profile
deteriorate, because of significantly low cash accruals, or
significantly delayed fee receipts, or sizeable debt-funded
capital expenditure.
Set up in 2007, DVR operates the Vikash College of Engineering for
Women, and Vikash Degree College, in Bargarh (Odisha). The trust
also runs the Vikash Concepts School, Vikash Junior College and
Vikash Polytechnic in Sambalpur (Odisha).
DEEPMALA FISHERIES: CRISIL Puts B Rating to INR50.5MM Bank Loan
---------------------------------------------------------------
CRISIL has assigned its 'CRISIL B/Stable/CRISIL A4' ratings to the
bank facilities of Deepmala Fisheries.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Term Loan 29.5 CRISIL B/Stable
Packing Credit 40 CRISIL A4
Proposed Long Term
Bank Loan Facility 50.5 CRISIL B/Stable
The ratings reflect DF's nascent stage and small scale of
operations in the highly competitive seafood industry, and its
exposure to risks related to volatility in raw material prices.
These rating weaknesses are partially offset by the extensive
experience of the firm's proprietor in the marine exports industry
and its expected moderate working capital requirements.
Outlook: Stable
CRISIL believes that DF will continue to benefit over the medium
term from the extensive industry experience of its proprietor. The
outlook may be revised to 'Positive' if the firm stabilises its
operations earlier-than-expected, leading to a substantial
increase in its cash accruals and consequently to an improved
capital structure. Conversely, the outlook may be revised to
'Negative' if DF's operating margin is lower than anticipated, or
if it undertakes a substantial debt-funded expansion programme, or
if its working capital management deteriorates, resulting in
significant weakening of its financial risk profile.
Established in 2013, DF is a proprietorship firm based in Veraval
(Gujarat). The firm is owned and managed by Mr. Kishore Fofandi.
It is setting up a processing unit for the export of marine
products, and production is expected to commence from November
2014.
FLOURISH PAPER: ICRA Reaffirms B+ Rating on INR6.0cr LT Scale
-------------------------------------------------------------
ICRA has reaffirmed the long term rating of [ICRA]B+ and a short
term rating of [ICRA]A4 assigned to the INR14.3 Crore bank
facilities of Flourish Paper and Chemicals Limited.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Fund-Based limits-
Long Term scale 6.0 [ICRA]B+ reaffirmed
Term Loan - Long
Term scale 1.3 [ICRA]B+ reaffirmed
Non-Fund based limits
Short term scale 7.0 [ICRA]A4 reaffirmed
The ratings continued to be constrained by the company's adverse
financial risk profile characterised by aggressive capital
structure, moderate debt coverage indicators and high working
capital intensity; exposure to commodity price cycles associated
with the paper industry; competitive industry; and vulnerability
of profitability to volatility in forex rates.
Nevertheless, while assigning the ratings, ICRA has favourably
taken note of the long experience of promoters in paper chemical
business; and favourable prospects for paper industry in the
medium to long term.
Flourish Paper and Chemicals Ltd (FPCL) was incorporated in 1995.
The company is engaged in manufacturing and trading of chemicals
used in paper industry. The company also trades kraft papers as
well as writing and printing paper. The company has its
manufacturing facility located in Derabassi, Punjab with sizing
chemicals manufacturing capacity of 18000 MTPA.
Recent Results
FPCL reported a operating income of INR39.07 Crore and a net
profit of INR0.38 Crore during financial year 2013-14. The company
had reported a turnover of INR34.71 Crore and a net profit of
INR0.37 Crore during financial year 2012-13.
GARDENIA INDIA: ICRA Reaffirms B+ Rating on INR90cr Term Loan
-------------------------------------------------------------
ICRA has reaffirmed the long term rating of [ICRA]B+ for INR90.0
crore (earlier INR35.0 crore) term loans of Gardenia India
Limited.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Term Loan 90.0 [ICRA]B+ Reaffirmed
The rating continues to remain constrained by the execution risks
for GIL's residential projects which are under development,
especially Gardenia Gateway which is significantly larger than the
size of the projects completed in the past. Further, the customer
advances have remained low in comparison to the value of the area
sold, which exposes the company to funding risk as a significant
proportion of the project cost is proposed to be funded by
customer advances. The rating also takes into account market risk
associated with unsold area in the projects as there is a
significant competition in the vicinity with a large quantum of
unsold inventory. ICRA also takes note of the company's exposure
to geographical concentration risks with operations being confined
to Noida and Ghaziabad and the susceptibility of real estate
markets to economic cycles. Apart from above the rating also
factors in GIL's exposure by way of sizeable corporate guarantees
given by GIL for projects of its group companies.
The rating however continues to derive strengths from GIL's
experienced promoters, its demonstrated capabilities in the
residential housing segment through other group companies, low
approval and regulatory risks with respect to its on-going
projects and regular funding support from the promoters for its
projects.
Going forward GIL's ability to successfully execute the ongoing
project within budgeted cost and time; and ensure timely bookings
as well as collection from the existing bookings would be critical
determinants of its credit risk profile.
Gardenia India Limited was founded by Mr. Manoj Kumar Ray & Mr.
Sanjeev Sharma in January 2007. GIL is involved in real estate
development activities and is an ISO 9001:2000 certified company.
Prior to setting up GIL, its promoters had been involved in real
estate industry for more than a decade. GIL has completed a number
of projects in past and is involved in development of few projects
primarily in National Capital Region.
Recent Results
The company has reported a profit after tax of INR0.88 crore on an
operating income of INR144.06 crore during FY2013 vis-…-vis profit
after tax of INR6.90 crore on an operating income of INR150.76
crore during FY2012.
GOVINDA MINERALS: CRISIL Cuts Rating on INR70MM Cash Loan to 'D'
---------------------------------------------------------------
CRISIL has downgraded its rating on the bank facilities of Govinda
Minerals Private Limited to 'CRISIL D/CRISIL D' from CRISIL
B/Negative/CRISIL A4'.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Cash Credit 70 CRISIL D (Downgraded from
'CRISIL B/Negative')
Letter of Credit 50 CRISIL D (Downgraded from
'CRISIL B/Negative')
The rating downgrade reflects consistent overdrawals in CC
facilities of the company for over 30 days owing to weak
liquidity.
The rating also reflects GMPL's weak financial risk profile marked
by weak liquidity and small scale of operations in the fragmented
steel industry. These rating weaknesses are partially offset by
the extensive experience of the promoters in the industry.
Govinda trades in various steel products and minerals, such as
iron ore and ferro alloys. The company commenced commercial
operations in 2008-09. The company operates primarily in and
around Kolkata (West Bengal).Govinda's day-to-day operations are
looked after by its promoter-directors, Mr. Rajesh Singhi and Mr.
Giriraj Binani.
For 2011-12, Govinda, on a provisional basis, reported a net
profit of INR1.8 million on net sales of INR958.00 million, as
against a net profit of INR2.00 million on net sales of INR797.00
million for 2010-11.
HACO MACHINERY: ICRA Suspends D Rating on INR6.31cr FB Loan
-----------------------------------------------------------
ICRA has suspended [ICRA]D rating assigned to the INR6.31 crore
fund based limits, INR1.85 crore non fund based limits and INR3.07
crore unallocated limits of HACO Machinery Pvt. Ltd. The
suspension follows ICRA's inability to carry out a rating
surveillance in the absence of the requisite information from the
company.
HACO Machinery Pvt Ltd (erstwhile ISGEC Haco Metal Forming
Machinery Pvt Ltd) commenced operations in November, 2007 as a JV
between SISL and HACO NV Belgium. However SISL sold its entire
stake in the company to the Haco which is now the sole promoter in
the company. HACO is a well known international player in the
field of sheet metal forming machinery such as hydraulic press
brakes, shears and plasma cutting machines. HMPL operates out of a
manufacturing unit in Rewari, Haryana. Its product portfolio
comprises of hydraulic press brakes, hydraulic shears, and plasma
cutting machines.
JAGADAMBHA COTTON: CRISIL Cuts Rating on INR345MM Cash Loan to D
----------------------------------------------------------------
CRISIL has downgraded its rating on the long term bank facilities
of Jagadambha Cotton Industries Private Limited to 'CRISIL D' from
'CRISIL BB-/Stable'.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Cash Credit 345 CRISIL D (Downgraded from
'CRISIL BB-/Stable')
Rupee Term Loan 14.5 CRISIL D (Downgraded from
'CRISIL BB-/Stable')
The rating downgrade reflects instances of delay by JCPL in
servicing its debt; the delays have been caused by the company's
weak liquidity.
JCPL's profitability margins are susceptible to volatility in
cotton prices, and the company is also exposed to intense
competition and regulatory changes in the cotton ginning industry.
However, the company benefits from its promoters extensive
experience in the cotton ginning business.
JCPL is engaged in ginning and pressing of raw cotton and its
ginning unit is located in Khammam district in Andhra Pradesh. The
company is owned and managed by Mr. G Srinivasa Rao and Mr. Vinod
Kumar Agarwal.
JAGWANI PROJECTS: CRISIL Reaffirms B Rating on INR40MM Cash Loan
----------------------------------------------------------------
CRISIL's ratings on the bank facilities of Jagwani Projects
Private Limited continue to reflect JPPL's working-capital-
intensive operations, and weak financial risk profile, marked by a
small net worth, and high total outside liabilities to tangible
net worth ratio and high gearing. These rating weaknesses are
partially offset by the extensive entrepreneurial experience of
the company's promoters.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Cash Credit 40 CRISIL B/Stable (Reaffirmed)
Packing Credit 60 CRISIL A4 (Reaffirmed)
Outlook: Stable
CRISIL believes that JPPL will continue to benefit over the medium
term from the extensive entrepreneurial experience of its
promoters. The outlook may be revised to 'Positive' if there is
substantial improvement in the company's working capital
management or profitability, leading to a better financial risk
profile. Conversely, the outlook may be revised to 'Negative' if
JPPL's financial profile, especially its liquidity, deteriorates,
most likely because of a stretch in its working capital cycle and
debt-funded capital expenditure.
JPPL, incorporated in 1988, is promoted by the Kolkata (West
Bengal)-based Jagwani family. It currently exports iron ore fines.
The company also plans to set up a light-emitting diode (LED)
manufacturing unit.
JAISHRIRAM SUGAR: CRISIL Assigns D Rating to INR136.5MM Cash Loan
----------------------------------------------------------------
CRISIL has assigned its 'CRISIL D' rating to the long-term bank
facilities of Jaishriram Sugar and Agro Products Ltd. The rating
reflects the delay by JSAPL in servicing its term loan; the delay
has been caused by the company's weak liquidity, driven by its
suboptimal operating performance, with lower sugar cane crushing
leading to cash losses.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Cash Credit 33.5 CRISIL D
Sugar Pledge
Cash Credit 136.5 CRISIL D
JSAPL also has a weak financial risk profile, marked by weak
capital structure and debt protection metrics; moreover, it is
susceptible to the availability of sugar cane and to the high
degree of regulatory risks in the sugar industry. However, the
company benefits from the entrepreneurial experience of its
promoters and their continued funding support.
JSAPL was incorporated in February 2006 with an objective of
installing and commissioning a sugar plant with a capacity of 2000
tonnes of sugarcane crushed per day and a 6.5-megawatt
cogeneration plant. The plant, located at Halgaon, Ahmednagar
(Maharashtra), commenced commercial operations in 2012-13 (refers
to financial year, April 1 to March 31). The company's day-to-day
operations are now being taken care of by its current promoter Mr.
M N Navale and his family members.
KBJ JEWEL: CRISIL Downgrades Rating on INR1.05BB Cash Loan to D
---------------------------------------------------------------
CRISIL has downgraded its ratings on the bank facilities of
KBJ Jewel Industry India Pvt Ltd (KBJ Jewel; formerly known as KBJ
Jewellery Private Limited) to 'CRISIL D' from 'CRISIL BB+/Stable'.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Cash Credit 1050 CRISIL D (Downgraded from
'CRISIL BB+/Stable')
Proposed Long Term 50 CRISIL D (Downgraded from
Bank Loan Facility 'CRISIL BB+/Stable')
The rating downgrade reflects consistent overdawals for over 30
days in the group's bank facilities owing to stretched liquidity.
The rating also reflects high competition and fragmented nature of
business, exposure to regulatory changes in the gems and jewellery
business and its weak financial risk profile marked by weak debt
protection measures. These rating weaknesses are partially offset
by KBJ group's established presence in the gems and Jewellery
industry.
For arriving at the ratings, CRISIL has consolidated the business
and financial profiles of KBJ Jewel, Aksha Gold Ornaments Limited
(Aksha; formerly known as KBJ Gold Ornaments Ltd), Shakuntala Gold
Ornaments Limited (Shakuntala; formerly known as KBJ Gems and
Jewellery Limited) and BLK exim Limited (BLK; formerly known as
KBJ exports Limited) together referred as 'KBJ Group' on account
of business synergies within the group due to common manufacturing
facilities, common set of customers, financial fungibility within
group companies.
KBJ Jewel was incorporated in 2006, by Mr. Mohit Kamboj, a Mumbai-
based third generation entrepreneur; it manufactures plain gold
jewellery. The company is part of the Mumbai-based KBJ group
engaged in wholesale gold jewellery manufacturing such as
necklaces (primarily mangalsutras), bracelets, earrings, bangles
and other related products
KBJ Jewel is part of Mumbai based KBJ group engaged in wholesale
gold jewellery manufacturing. Apart from KBJ Gold, KBJ group has
other entities named Aksha Gold Ornaments Limited ( Aksha;
formerly known as KBJ Gold Ornaments Ltd.), Shakuntala Gold
Ornaments Limited( Shakuntala; formerly known as KBJ Gems and
Jewellery Limited) and BLK exim Limited (BLK; formerly known as
KBJ exports Limited). All the entities are based at Mumbai with
common manufacturing facilities, common set of customers, common
promoters and management
KBJ Jewel reported(on provisional basis) a profit after tax (PAT)
of INR6.1 million on net sales of INR12.2 billion for 2013-14, as
against a PAT of INR0.7 million on net sales of INR6.1 billion for
2012-13.
KERALA ELECTRICAL: CRISIL Assigns B Rating to INR173.5M Cash Loan
-----------------------------------------------------------------
CRISIL has assigned its 'CRISIL B/Stable/CRISIL A4' ratings to the
bank facilities of Kerala Electrical & Allied Engg. Co. Ltd.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Proposed Long Term 3.5 CRISIL B/Stable
Bank Loan Facility
Letter of Credit 60 CRISIL A4
Cash Credit 173.5 CRISIL B/Stable
Bank Guarantee 80 CRISIL A4
Bill Purchase 3 CRISIL A4
The ratings reflect KEL's below-average financial risk profile
marked by weak capital structure and sub-par debt protection
metrics, as well as its large working capital requirements. These
rating weaknesses are partially offset by KEL's established market
position in the transformer segment in Kerala and the continuous
fund support that it receives from the Government of Kerala (GoK)
for operational and financial requirements.
Outlook: Stable
CRISIL believes that KEL will continue to receive fund support
from GoK for its operations and timely debt servicing. The outlook
may be revised to 'Positive' if the company scales up its
operations and improves its operating margin significantly,
leading to sizeable cash accruals. Conversely, the outlook may be
revised to 'Negative' in case of significant cash losses or delay
in fund support from GoK, further weakening of its financial risk
profile.
KEL, set up in 1964 and based in Kochi (Kerala), manufactures
transformers and other electrical products, and steel structures.
KEL is wholly owned by GoK and its nominees. The company's daily
operations are managed by Mr. Beemapally Rasheed.
KEL, on a provisional basis, reported loss of INR30 million on
total revenue of INR900 million for 2013-14 (refers to financial
year, April 1 to March 31), against loss of INR65 million on total
revenue of INR649 million for 2012-13.
KHAS FOODS: CRISIL Assigns B Rating to INR50MM LT Bank Loan
-----------------------------------------------------------
CRISIL has assigned its 'CRISIL B/Stable/CRISIL A4' ratings to the
bank facilities of Khas Foods Pvt Ltd.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Proposed Long Term 50 CRISIL B/Stable
Bank Loan Facility
Packing Credit 25 CRISIL A4
Bill Discounting 15 CRISIL B/Stable
Overdraft Facility 10 CRISIL A4
The ratings reflect KFPL's below-average financial risk profile,
marked by a modest net worth, high gearing, and weak debt
protection metrics. The ratings also factor in the company's
modest scale of operations in the highly fragmented rice industry
and exposure to volatility in foreign exchange rates. These rating
weaknesses are partially offset by the extensive industry
experience of KFPL's promoters.
Outlook: Stable
CRISIL believes that KFPL will continue to benefit from its
promoters' extensive industry experience, over the medium term.
The outlook may be revised to 'Positive' in case the company
reports better-than-expected scale of operations and profitability
or substantial capital infusion along with efficient working
capital management. Conversely, the outlook may be revised to
'Negative' if the company's cash accruals are lower than expected
or if its working capital requirements are larger than expected or
if the company undertakes any unanticipated debt-funded capital
expenditure.
KFPL was incorporated in 2008 and is based in New Delhi. The
company trades in basmati and non-basmati rice. KFPL is promoted
by Mr. Pranav Puri and his family members.
KRISHNA NATURAL: ICRA Assigns B+ Rating to INR8.9cr Cash Credit
---------------------------------------------------------------
The long-term rating of [ICRA]B+ has been assigned to the INR8.90
crore cash credit facility and INR1.05 crore term loan facility of
Krishna Natural Fibre Private Limited.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Cash Credit 8.90 [ICRA]B+ assigned
Term Loan 1.05 [ICRA]B+ assigned
The assigned rating is constrained by KNFPL's modest scale of
operations and highly leveraged capital structure owing to low net
worth base. The ratings are further constrained by KNFPL's low
operating margins on account of low value addition in the
business; highly competitive and fragmented industry structure
owing to low entry barriers; and the vulnerability of the
company's profitability to raw material (i.e. cotton) prices,
which are subject to seasonality, crop harvest and regulatory
risks.
The assigned rating, however, favourably factors in the long-
standing experience of the company's promoters in the cotton
industry and favourable location of the company's manufacturing
facility at Kadi in Gujarat giving it an easy access to quality
raw material.
Incorporated in October 1999, Krishna Natural Fibre Private
Limited (KNFPL) is engaged in the business of ginning and pressing
of raw cotton. The company's manufacturing facility is located at
Kadi in Gujarat and is equipped with twenty-four ginning machines
and one pressing machine. The company is currently promoted by Mr.
Nathalal Jani, Mr. Bipin Patel along with other family
members/relatives who have a long-standing experience in the
cotton industry.
Recent Results
During FY 2014 (provisional financials), KNFPL reported an
operating income of INR68.74 crore and profit after tax of INR0.08
crore as against an operating income of INR61.81 crore and profit
after tax of INR0.09 crore during FY 2013.
MILESTONE BUILDCON: CRISIL Reaffirms B Rating on INR1.40BB Loan
---------------------------------------------------------------
CRISIL's rating on the bank facility of Milestone Buildcon Pvt Ltd
continues to reflect MBPL's exposure to residual implementation
risks (the first phase of the company's project is expected to be
operational by March 2015) and offtake risk associated with its
ongoing information technology (IT) special economic zone (SEZ)
project in Bengaluru. These rating weaknesses are partially offset
by the operational and financial support that MBPL receives from
its promoter, the Bhartiya group.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Rupee Term Loan 1400 CRISIL B/Stable (Reaffirmed)
Outlook: Stable
CRISIL believes that MBPL will receive operational and financial
support from the Bhartiya group to operationalise its project and
to service its debt in a timely manner. The outlook may be revised
to 'Positive' in case of significant improvement in the company's
capital structure and higher occupancy for its project.
Conversely, the outlook may be revised to 'Negative' in case of
low occupancy or large debt, constraining its financial risk
profile.
MBPL is a wholly owned subsidiary of Bhartiya Urban Infrastructure
& Land Development Co Pvt Ltd, which was incorporated in 2006 by
the Bhartiya group. MBPL is developing an IT SEZ at Bhartiya City
in Bengaluru. In the first phase of the project, the company will
develop leasable area of 0.571 million square feet at a total
project cost of INR2213 million, which will be operational by
March 2015.
The Bhartiya group has been engaged for over two decades in the
fashion business through Bhartiya International Ltd (BIL), which
exports leather garments and accessories for brands such as Zara,
Mango, Louis Vuitton, and Tommy Hilfiger.
For 2013-14 (refers to financial year, April 1 to March 31), BIL
reported a net profit of INR145 million on net sales of INR4.14
billion, against a net profit of INR101 million on net sales of
INR3.04 billion for 2012-13.
OM SAKTHI: CRISIL Reaffirms B Rating on INR95MM Overdraft Loan
--------------------------------------------------------------
CRISIL's ratings on the bank loan facilities of Om Sakthi
Constructions (OSC) continue to reflect OSC's susceptibility to
intense competition in the civil construction industry due to the
tender-based nature of its operations, and its large working
capital requirements. These rating weaknesses are partially offset
by the extensive industry experience of the firm's promoters and
its moderate financial risk profile, marked by moderate gearing
and debt protection metrics though constrained by a modest net
worth.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Bank Guarantee 25 CRISIL A4 (Reaffirmed)
Overdraft Facility 95 CRISIL B/Stable (Reaffirmed)
Outlook: Stable
CRISIL believes that OSC will continue to benefit over the medium
term from its healthy order book and the extensive industry
experience of its promoters. The outlook may be revised to
'Positive' if the firm's scale of operations improves
significantly, leading to higher cash accruals and improved
liquidity. Conversely, the outlook may be revised to 'Negative' if
OSC undertakes a significant deb-funded capital expenditure
programme, or its revenue or profitability decline, or its
promoters withdraw substantial capital, leading to deterioration
in its financial risk profile.
Update
OSC's revenues during 2013-14 (refers to financial year, April 1
to March 31), remained muted at INR850 million owing to the
slowdown in civil construction in Tamil Nadu. However, there has
been an improvement during 2014-15, with revenue of INR600 million
for the five months ended August 31, 2014. CRISIL believes that
OSC's cash accruals will remain low at INR14 million to INR18
million in 2014-15 due to low operating profitability.
OSC's financial risk profile remains moderate, constrained by a
small net worth. The firm had a net worth of INR79 million, with a
moderate gearing of 1.2 times, as on March 31, 2014. Over the
medium term, its net worth is expected to only marginally improve
owing to expected capital withdrawals. The firm's debt protection
metrics are expected to remain comfortable over this period.
OSC's liquidity is stretched, with highly utilised overdraft
limits. The firm's bank limits were highly utilised through the 12
months through August 2014 due to its working-capital-intensive
operations. CRISIL believes that the firm's cash accruals will
remain low over the medium term.
Set up in 2011 as a partnership firm, OSC undertakes civil
construction in the roads segment in Tamil Nadu and Puducherry.
The firm is promoted by Mr. V Kannan along with his family
members.
R.J CHATHA: ICRA Assigns B+ Rating to INR10cr Packing Credit
------------------------------------------------------------
ICRA has assigned long-term rating of [ICRA]B+ to INR22.0 crore
fund based facilities of R.J Chatha Rice Mills.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Cash Credit 7.00 [ICRA]B+ Assigned
Packing Credit 10.00 [ICRA]B+ Assigned
Warehouse Receipts 5.00 [ICRA]B+ Assigned
The assigned rating factors in moderate scale of operations of the
firm in rice milling business which coupled with high intensity of
competition in the industry has resulted in low profitability and
stretched debt coverage indicators. Funding of working capital
requirements majorly through bank borrowings has led to a highly
leveraged capital structure. The rating also takes into account
the working capital intensive nature of rice milling business
arising out of the need to maintain substantial inventories in
line with the industry trends. The rating also takes into account
agro climatic risks, which can affect the availability of paddy in
adverse conditions. ICRA however draws comfort from long
experience of promoters in rice industry, proximity of the mill to
major rice growing area which results in easy availability of
paddy and stable demand outlook of rice in both Indian and foreign
markets.
Incorporated in the year 1971, R.J Chatha Rice Mills is a
partnership firm engaged in milling and processing of basmati and
non basmati rice. The firm has its plant located in Amritsar
(Punjab) with milling capacity of 4MT/ hour. The firm exports rice
mainly to Iran, Oman, Saudi Arabia and other Middle East
countries.
Recent Results
The firm reported a net profit after tax of INR0.10 crore on an
operating income of INR99.73 crore (as per provisional numbers) in
FY2014 as against net profit of INR0.05 crore on an operating
income of INR63.28 crore in FY2013.
SAHAJANAND TEXTILES: ICRA Suspends D Rating on INR14.87cr FB Loan
-----------------------------------------------------------------
ICRA has revised and suspended the rating assigned to the INR14.87
crore bank facilities of Sahajanand Textiles Private Limited from
[ICRA]B to [ICRA]D.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long Term Fund 14.87 [ICRA]D Revised
Based Limits from [ICRA]B and Suspended
The revised ratings take into account the stretched liquidity
position of the company and continued delays in debt servicing
following cash flow mismatches. The suspension follows ICRA's
inability to carry out a rating surveillance in the absence of
requisite information from the company.
Sahajanand Textiles Private Limited (STPL), incorporated in July
2012, has been set-up for the manufacturing of artificial silk
cloth. The company's products will find application in suiting,
shirting, dress materials, curtains and furnishing. STPL's
manufacturing site is located at Pipodra village in Surat district
(Gujarat).
SANT FOODS: ICRA Reaffirms B Rating on INR17cr Fund Based Limits
----------------------------------------------------------------
ICRA has reaffirmed the [ICRA]B rating to the INR17.00 crore fund
based facilities of Sant Foods Private Limited.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Fund Based limits 17.00 [ICRA]B (reaffirmed)
The rating is constrained by SFPL's weak financial profile as
reflected by low profitability metrics, high gearing and
consequently weak debt coverage indicators coupled with high
working capital requirements. The rating also takes into account
high intensity of competition in the industry and agro climatic
risks, which can affect the availability of paddy in adverse
weather conditions. The rating, however favorably takes into
account long standing experience of promoters in rice industry and
the proximity of the mill to major rice growing area which results
in easy availability of paddy.
Sant Foods Private Limited was established in the year 2008. The
Company is primarily engaged in the milling of rice with an
installed capacity of 6 tons per hour. The company has 2 sortex
machines with the capacity of 5 tons/hour and 2 tons/hour. The
company is professionally is managed by Mr. Pradeep Wadhwa.
Recent Results
During the financial year 2013-14, the Company reported a profit
after tax (PAT) of INR0.13 crore on an operating income of
INR44.13 crore as against PAT of INR0.10 crore on an operating
income of INR40.09 crore in FY13
SHAKUNTALA GOLD: CRISIL Cuts Rating on INR280MM Cash Loan to 'D'
---------------------------------------------------------------
CRISIL has downgraded its ratings on the bank facilities of
Shakuntala Gold Ornaments Limited (Shakuntala; formerly known as
KBJ Gems and Jewellery Limited; part of the KBJ Group) to 'CRISIL
D' from 'CRISIL BB+/Stable'.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Cash Credit 280 CRISIL D (Downgraded
from 'CRISIL BB+/Stable')
Proposed Long Term 20 CRISIL D (Downgraded
Bank Loan Facility from 'CRISIL BB+/Stable')
The rating downgrade reflects consistent overdawals for over 30
days in the group's bank facilities owing to stretched liquidity.
The rating also reflects high competition and fragmented nature of
business , exposure to regulatory changes in the gems and
jewellery business and its weak financial risk profile marked by
weak debt protection measures. These rating weaknesses are
partially offset by KBJ group's established presence in the gems
and Jewellery industry.
For arriving at the ratings, CRISIL has consolidated the business
and financial profiles of Shakuntala, Aksha Gold Ornaments Limited
(Aksha; formerly known as KBJ Gold Ornaments Limited), KBJ Jewel
Industry India Pvt Ltd (KBJ Jewel; formerly known as KBJ Jewellery
Private Limited) and BLK Exim Limited (BLK; formerly known as KBJ
exports Limited) together referred as 'KBJ Group' on account of
business synergies within the group due to common manufacturing
facilities, common set of customers, financial fungibility within
group companies.
Shakuntala was incorporated in 2011 by Mr. Mohit Kamboj, a Mumbai-
based third generation entrepreneur; it manufactures fancy
jewellery. The company is part of Mumbai-based KBJ group engaged
in wholesale gold jewellery manufacturing such as necklaces
(primarily mangalsutras), bracelets, earrings, bangles and other
type of related allied products.
Shakuntala is part of Mumbai based KBJ group engaged in wholesale
gold jewellery manufacturing. Apart from Shakuntala, KBJ group has
other entities named Aksha Gold Ornaments Limited (Aksha; formerly
known as KBJ Gold Ornaments Limited), KBJ Jewel Industry India
Pvt. Ltd. (KBJ Jewel; formerly known as KBJ Jewellery Private
Limited) and BLK exim Limited (BLK; formerly known as KBJ exports
Limited). All the entities are based at Mumbai with common
manufacturing facilities, common set of customers, common
promoters and management
Shakuntala reported(on provisional basis) a profit after tax (PAT)
of INR5.4 million on net sales of INR4.1 billion for 2013-14, as
against a PAT of INR0.4 million on net sales of INR4 billion for
2012-13.
SHREE TIRUPATI: CRISIL Assigns 'B+' Rating to INR50MM Cash Credit
-----------------------------------------------------------------
CRISIL has assigned its 'CRISIL B+/Stable' rating to the bank
facilities of Shree Tirupati Ginning & Pressing Factory (STGPF).
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Cash Credit 50 CRISIL B+/Stable
Term Loan 14 CRISIL B+/Stable
The ratings reflect STGPF's modest scale of operation in
fragmented and competitive cotton industry and vulnerability of
operating performance to changes in government policy. The rating
also factors in below average financial risk profile marked by
leveraged capital structure and weak debt protection measures.
These rating strengths are partially offset by extensive
experience of STGPF's promoters in cotton industry and their
established relations with suppliers and wide customer base.
Outlook: Stable
CRISIL expects STGPF to continue to benefit over the medium term,
backed by its partner's extensive experience in the cotton
industry and established relations with customers. The outlook may
be revised to 'Positive' in case of higher-than expected scale of
operations, while improving its profitability margins, resulting
in better cash accruals. Conversely, the outlook may be revised to
'Negative', if STGPF's financial risk profile deteriorates due to
lengthening of its working capital cycle or due to decline in
revenues or profitability.
STGPF was set as a partnership firm in 2003 by Mr. Ramnivas Tiwari
along with his sons Mr. Vijay R. Tiwari and Mr. Ajay R. Tiwari
along with their family member Mr. Omprakash M. Tiwari. The firm
is engaged in ginning and pressing of raw cotton (kapas) to make
cotton bales, and also has a seed crushing unit where cotton oil
is extracted from cotton seeds. It also undertakes sell of cotton
seed and cotton seed cake and trading of raw cotton. Day to day
operations of the firm is managed by Mr. Ajay Tiwari and Mr.
Omprakash Tiwari.
SHRI HARI: ICRA Suspends 'D' Rating on INR12cr Cash Credit
----------------------------------------------------------
ICRA has suspended the [ICRA]D rating assigned to the INR13.18
crore long term working capital limits and term loan limits of
Shri Hari Cotex Private Limited. The suspension follows ICRAs
inability to carry out a rating surveillance due to non
cooperation from the company.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long Term-Fund Based
Limits - Cash Credit 12.00 [ICRA]D; Suspended
Long Term-Fund Based 1.18 [ICRA]D; Suspended
Limits Term Loan
Shri Hari Cotex Pvt Ltd. incorporated in 2010 was promoted by Mr.
Bhavesh Shelani, Mr. Gopal Shelani and Mr. Harshad Shelani. The
company is engaged in cotton ginning & pressing to produce cotton
bales and cotton seeds. The company is equipped with 30 ginning
machines having an intake capacity of 150 MTPD and the commercial
production was expected to start in October 2011, however the same
has commenced from April 2012 due to delay in getting power
connection from GEB.
SHUBHAM INDUSTRIES: ICRA Assigns B+ Rating to INR7.5cr Cash Loan
----------------------------------------------------------------
The long-term rating of [ICRA]B+ has been assigned to the INR7.50
crore cash credit facility of Shubham Industries.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Cash Credit 7.50 [ICRA]B+ assigned
The assigned rating is constrained by SI's low operating margins
on account of low value addition in the business; highly
competitive and fragmented industry structure owing to low entry
barriers; and the vulnerability of the firm's profitability to raw
material (i.e. cotton) prices, which are subject to seasonality,
crop harvest and regulatory risks. ICRA also notes that as SI is a
partnership firm, any significant withdrawals from the capital
account by the partners would affect its net worth and thereby its
capital structure; this remains a key rating sensitivity.
The assigned rating, however, favourably factor in the long-
standing experience of the firm's promoters in the cotton
industry; favourable location of the firm's manufacturing facility
at Kadi in Gujarat giving it an easy access to quality raw
material and favourable demand outlook for cotton and cottonseeds
in the domestic market.
Shubham Industries (SI) was established as a partnership firm in
2005 and is engaged in the business of ginning & pressing of raw
cotton and crushing of cotton seeds. The firm's manufacturing
facility is located at Kadi in Gujarat and is equipped with forty-
two ginning machines, one pressing machine and thirteen expeller
machines. The firm is currently promoted by Mr. Ashok Patel, Mr.
Bhavin Patel along with other family members who have a long-
standing experience in the cotton industry.
Recent Results
During FY 2014 (provisional financials), SI reported an operating
income of INR86.78 crore and profit after tax of INR0.36 crore as
against an operating income of INR58.34 crore and profit after tax
of INR0.21 crore during FY 2013.
TROIX CHEMICALS: ICRA Cuts Rating on INR10cr Fund Based Loan to B
-----------------------------------------------------------------
ICRA has downgraded the long-term rating assigned to bank
facilities of Troix Chemicals Private Limited aggregating to
INR10.00 crore (enhanced from INR7.00 crore) from [ICRA]B+ to
[ICRA]B. The rating suspension done in May 2014 has been revoked.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long-term Fund- 10.00 [ICRA]B; Downgraded from
based limits [ICRA]B+
The rating revision takes into account the significant
deterioration in company's operations in FY 2014 and YTD FY 2015
on account of disruption in supplies from company's principal viz.
Andhra Petrochemicals Limited (APL) since September 2013; which in
turn has primarily been on account of issues faced by APL's main
supplier viz. Hindustan Petroleum Corporation Limited's Vizag
refinery. Further, owing to reduced sales and pressure on
profitability margins, the company reported loss in FY 2014 and 4m
FY 2014 which has led to significant erosion in its net worth
position leading to a stretched capital structure. The rating is
further constrained by the company's modest scale of operations
and intense competitive pressures from imports. ICRA further notes
that the company's product profile remains limited; though
company's recent foray into trading of monomers and plans of
trading business in Ethyl Acetate is expected to diversify its
product profile to some extent.
The rating, however, favourably takes into account the extensive
experience of the promoter group; the diverse customer base; and
the established position of the company as a leading distributor
for APL, which is the sole producer of oxo-alcohols in the
domestic market.
Troix Chemicals Private Ltd. is an authorised distributor of
Andhra Petrochemicals Limited for its three main products viz. 2-
Ethyl Hexanol (2-EH), Iso-Butanol and n-Butanol, which mainly find
application in the plastics and as solvents in the paints/coatings
and pharmaceutical industries. TCPL is managed by four Directors
viz. Mr. Rajesh Punamiya, Mr. Vijaykumar Punamiya, Mr. Rohit Jain
and Mr. Vinit Jain, each holding ~25% of the shareholding in the
company. The company was established in 1996-97 by the earlier
management and was later acquired by the present management in
1999, and commenced operations in the trading of petrochemicals in
2001.
Recent Results
For the year-ended March 31, 2014, the company reported an
Operating Income (OI) of INR66.32 crore and loss of INR0.74 crore
(provisional). For the 4months-ended July 31, 2014, the company
reported operating income of INR18.86 crore and loss of INR0.67
crore (provisional).
=================
S I N G A P O R E
=================
MYTRAH ENERGY: S&P Assigns 'B' LT Rating to Proposed Notes Issue
----------------------------------------------------------------
Standard & Poor's Ratings Services affirmed its 'B' long-term
corporate credit rating on Guernsey-based Mytrah Energy Ltd.
(Mytrah). The outlook is stable. S&P also assigned its 'B' long-
term issue rating to a proposed issue of senior notes that Mytrah
guarantees. The company's wholly owned subsidiary Mytrah Energy
(Singapore) Pte. Ltd. will issue the notes. Mytrah operates wind
power assets in India.
The rating affirmation reflects S&P's view that Mytrah's revenue
growth will continue to be strong over the next two years as the
company adds wind power capacity. This will improve Mytrah's
financial position, although leverage is likely to remain high
over the period.
S&P estimates that Mytrah's revenue will grow 50% or more annually
over the next two years. The company commissioned about 200
megawatt (MW) of wind capacity over the past six months,
increasing wind capacity to 517 MW. Mytrah is likely to
commission another 32 MW capacity in the next two to three months.
At the same time, S&P expects the company to maintain its high
EBITDA margins of about 90% because of its low operating costs.
Mytrah's long-term power purchase agreements that have fixed
tariffs support its business risk profile, which S&P assess as
"fair." The company also benefits from its diverse customers and
the chronic power deficit in India. Mytrah's exposure to weak
state electric utilities and the company's small scale and short
track record temper these strengths.
"We expect Mytrah's high capital expenditure for expansion over
the next two to three years to result in high leverage," said
Standard & Poor's credit analyst Mehul Sukkawala. "We believe
Mytrah will be exposed to exchange-rate risk if the proposed bond
is successful. This is because the company would have significant
foreign currency debt whereas all of its cash flows are
denominated in Indian rupee."
The bond will be issued by a restricted group comprising the
issuing company and five operating subsidiaries of Mytrah.
However, S&P assess the company on a consolidated basis, including
the restricted and the unrestricted group. That's because of the
restricted group's common management and line of business,
importance to Mytrah, and our unfavorable view of the Indian legal
environment.
"The stable outlook reflects our view that Mytrah will maintain
its priority dispatch position in supplying power and the
efficiency of operational wind farms. We also expect the company
to continue to benefit from a supportive regulatory framework for
wind power in India over the next 12 months. However, Mytrah's
significant expansion plans and high leverage will continue to
constrain its financial risk profile," Mr. Sukkawala said.
S&P could lower the rating on Mytrah if: (1) the company's capital
expenditure involves greater execution risks than S&P expects,
including significant cost overruns or delays in project
completion; (2) the company's operational efficiency weakens with
lower plant load factors than S&P's expectation, which lowers its
EBITDA interest coverage to less than 1.4x on a sustained basis;
or (3) the company's liquidity declines in the event that its cash
flows are utilized without leaving adequate reserves to meet
upcoming debt-servicing needs.
S&P sees limited upside to the rating over the next 12-24 months
because it expects Mytrah's financial risk profile to remain
"highly leveraged" over the period. S&P could raise the rating if
the company's operating performance improves significantly and
margins remain high. This could occur with greater
diversification in the asset base, strong operations, and a track
record of timely recoveries from customers.
*********
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 ***