/raid1/www/Hosts/bankrupt/TCRAP_Public/150617.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, June 17, 2015, Vol. 18, No. 118
Headlines
A U S T R A L I A
FLEXI ABS: Fitch Assigns 'BB(EXP)sf' Rating to Class E Notes
GOLDEN UNIVERSE: First Creditors' Meeting Set For June 22
TRIO CAPITAL: Advocacy Group Decries Astarra Fund De-Registration
* New Safe Harbour Laws May Save Insolvent Firms, Liquidator Says
C H I N A
ASIA FASHION: Responds to Auditor's Qualified Opinion
FUWEI FILMS: Gets Extension of NASDAQ Listing Compliance Period
HOPSON DEVELOPMENT: Moody's Affirms B3 CFR; Outlook Now Stable
* CHINA: Risks 'Real Damage' to Economy, Hank Paulson Says
H O N G K O N G
NORD ANGLIA: Moody's Assigns (P)B1 Rating to CHF235MM New Bonds
I N D I A
AGARWAL EDUCATION: CARE Revises Rating on INR12.61cr Loan to B+
AMBICA TIMBER: ICRA Reaffirms B+ Rating on INR10cr Cash Credit
ANIIRUDH ENTERPRISES: CRISIL Reaffirms D Rating on INR46MM Loan
BALWAS REALITY: CARE Assigns B+ Rating to INR10.02cr LT Loan
BASAVESHWAR ELECTRICALS: CRISIL Reaffirms B+ INR75MM Loan Rating
C.P. FOODS: CRISIL Reaffirms B+ Rating on INR55MM Loan
CHAUDHARY NURSING: CARE Assigns 'B+' Rating to INR1cr LT Loan
COT TEXTILES: CRISIL Suspends D Rating on INR430MM LT Loan
DELHI MSW: Ind-Ra Withdraws Issuer Rating of 'IND BB-(Suspended)'
DEY'S COLD: CRISIL Suspends 'B' Rating on INR60MM Cash Loan
GEO AQUATIC: CRISIL Assigns B+ Rating to INR49.6MM Bill Disc.
HES INFRA: Ind-Ra Suspends 'IND BB-' Long-Term Issuer Rating
INDIA FROZEN: Ind-Ra Affirms 'IND B+' Long-Term Issuer Rating
J.S. INTERNATIONAL: Ind-Ra Assigns 'IND BB+' LT Issuer Rating
KHADEEJA CASHEW: CRISIL Assigns 'B' Rating to INR40MM Cash Loan
KRISHNA TECHNOCHEM: CRISIL Reaffirms 'B' Rating on INR42.5MM Loan
M.J. INDUSTRIES: CRISIL Reaffirms 'B' Rating on INR70MM Cash Loan
M. R COTTON: CRISIL Reaffirms 'B' Rating on INR72.5MM Cash Loan
MAYUR COLDSTORAGE: CRISIL Reaffirms 'D' Rating on INR65MM Loan
MODERN DISTROPOLIS: CRISIL Reaffirms B Rating on INR150MM Loan
MOENUS TEXTILE: Ind-Ra Affirms 'IND BB-' Long-Term Issuer Rating
MOTOR SALES: CRISIL Reaffirms 'B' Rating on INR95MM Cash Loan
MUMBAI WASTE: Ind-Ra Withdraws 'IND BB-(Suspended)' Rating
NORTHERN INDIA: CRISIL Cuts Rating on INR150MM Cash Loan to 'B'
OVERSEAS CARPETS: CRISIL Assigns 'B-' Rating to INR180MM Loan
PRATHYUSHA EDUCATIONAL: 'IND D' Rating on INR133MM Loan Suspended
PRITHVI POLYMERS: Ind-Ra Assigns 'IND B' Long-Term Issuer Rating
R.G. PIGMENTS: CRISIL Reaffirms B+ Rating on INR30MM Bank Loan
RADICAL BIO-ORGANICS: CRISIL Suspends 'D' Rating on INR480MM Loan
RAJ INTERNATIONAL: CRISIL Suspends 'D' Rating on INR520MM Loan
RAMKY ENVIRO: Ind-Ra Withdraws 'IND BB-(Suspended)' Issuer Rating
RATAN ALUMINUM: CRISIL Reaffirms 'B+' Rating on INR100MM Loan
RIBA TEXTILES: Ind-Ra Affirms 'IND BB+' Long-Term Issuer Rating
ROYAL PALMS: CRISIL Suspends 'D' Rating on INR871.1MM Term Loan
SADVI POWER: CRISIL Suspends 'D' Rating on INR50MM Cash Loan
SAGAR EDUCATIONAL: CRISIL Suspends 'D' Rating on INR160MM Loan
SANJAY STRIPS: CRISIL Suspends B+ Rating on INR150MM Cash Loan
SHAH MAHENDRA: CRISIL Suspends 'D' Rating on INR140MM Bill Disc.
SHINE STAR: Ind-Ra Affirms 'IND BB-' Long-Term Issuer Rating
SHIVA UDYOG: CRISIL Suspends 'D' Rating on INR183.5MM Term Loan
SHREE BALAJI: Ind-Ra Assigns 'IND B+' Long-Term Issuer Rating
SIDDHIVINAYAK POLYTEX: Ind-Ra Affirms 'IND BB-' Issuer Rating
SINGHAL INDUSTRIES: CRISIL Suspends 'B' Rating on INR180.3MM Loan
SREE VEERA: CRISIL Reaffirms 'D' Rating on INR75.1MM Term Loan
SRI BALAJI: CRISIL Reaffirms B+ Rating on INR55MM Cash Loan
SRINIVAS INFRASTRUCTURE: Ind-Ra Assigns 'IND BB+' Issuer Rating
TAMILNADU WASTE: Ind-Ra Withdraws 'IND BB-(SO)(Suspended)' Rating
TARA EDUCATIONAL: CRISIL Assigns B+ Rating to INR13.8MM Loan
TECHNOFAB ENGINEERS: CRISIL Suspends 'D' Rating on INR40MM Loan
TRANS FAB: CRISIL Reaffirms B+ Rating on INR109.5MM Cash Loan
V M MATERE: CRISIL Suspends B+ Rating on INR100MM Cash Loan
V3 MEGACORP: CRISIL Reaffirms 'D' Rating on INR87MM Bank Loan
VINAYAK RATHI: CRISIL Suspends B Rating on INR225MM Cash Loan
VRS GRANITES: CRISIL Ups Rating on INR30MM LT Loan to 'B'
YETURU BIO-TECH: CRISIL Reaffirms 'D' Rating on INR40MM Cash Loan
M A L A Y S I A
MALAYSIA AIRLINES: Strike Will Only Backfire on MAS Employees
N E W Z E A L A N D
NZ DIRECTORIES: Creditors Approve Debt-For-Equity Deal
P A K I S T A N
PAKISTAN MOBILE: Moody's Upgrades CFR to B1, Outlook Now Stable
S I N G A P O R E
ASIA-EURO HOLIDAYS: Closes Doors; 500 Customers Affected
MAIN STREET: Goes Out of Business as Cash Runs Dry
* SINGAPORE: More Travel Agencies Go Bust as Consumers Go Online
S O U T H K O R E A
MAGNACHIP SEMICONDUCTOR: S&P Lowers CCR to 'CCC+'; Outlook Neg.
V I E T N A M
VIETNAM BANK: Moody's Assigns 'B1' Counterparty Risk Assessments
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A U S T R A L I A
=================
FLEXI ABS: Fitch Assigns 'BB(EXP)sf' Rating to Class E Notes
------------------------------------------------------------
Fitch Ratings has assigned expected ratings to Flexi ABS Trust
2015-2's asset-backed floating-rate notes. The issuance consists
of notes backed by small balance unsecured consumer loans
originated by Certegy Ezi-Pay Pty Ltd (Certegy) whose ultimate
parent is FlexiGroup Limited. The ratings are as follows:
AUD100 million Class A1 notes: 'F1+(EXP)sf';
AUD125.1 million Class A2 notes: 'AAA(EXP)sf'; Outlook Stable;
AUD17.1 million Class B notes: 'AA(EXP)sf'; Outlook Stable;
AUD12.85 million Class C notes: 'A(EXP)sf'; Outlook Stable;
AUD10 million Class D notes: BBB(EXP)sf'; Outlook Stable;
AUD5.7 million Class E notes: BB(EXP)sf'; Outlook Stable; and
AUD14.25 million Class F notes: NRsf
The notes will be issued by Perpetual Corporate Trust Limited in
its capacity as trustee of Flexi ABS Trust 2015-2.
At the cut-off date, the total collateral pool consisted of
142,188 individual consumer loan contracts totalling AUD280.9m.
The loan receivables are retail point-of-sale interest-free
consumer finance receivables that finance a wide variety of
products including solar equipment (43.1%); jewellery (17.9%);
fitness equipment (4%); and a broad cross section of other
products. Transactions issued by Certegy have portfolios that have
a remaining term that is shorter than typical Australian ABS
transactions; therefore we have amended back-loaded loss timing to
ensure the pool, towards the tail, is at least larger than the
balance of expected losses that are realised within our cashflow
analysis.
Key Rating Drivers
Experienced Originator: Certegy is a wholly owned subsidiary of
FlexiGroup Limited (FlexiGroup), a provider of retail point-of-
sale consumer finance. Certegy provides "no interest ever"
consumer loans, an interest-free product, and cheque guarantee
products in Australia. Certegy delivers its products through a
varied network of retailers and service providers.
Diverse and Granular Portfolio: The portfolio comprises of
receivables originated to a geographically diversified pool of
Australian retail customers across many asset types. The average
contract size is AUD1,976 while the weighted average (WA)
remaining term stands at 22.5 months. The pool contains 54.2%
homeowners and 30% repeat customers.
Strong Track Record: Delinquencies greater than 30 days on
Certegy's retail portfolio have historically tracked below 3.0%.
Availability of Excess Spread: The transaction yields significant
levels of excess spread which is used to support the rating of the
Class D and E notes, while sufficient credit enhancement, provided
by the subordination of more junior notes, exists for the Class
A1, A2, B and C notes, to be rated independent of any soft credit
support (excess spread).
Support Features Support Rating: A liquidity reserve, funded by
proceeds from issuance, will ensure stable cash flows for all
rated notes and trust expenses. A derivative reserve account will
be established to set aside any voluntary prepayments made by
borrowers, to ensure sufficient income is available to cover
future swap payments.
No Residual Value Risk: All securitised loans are structured so
that there is no exposure to residual value risk, with the
borrower liable for such risks at all times.
Expected Rating Sensitivities
In Fitch's analysis, all rated classes of notes could withstand
more than a 50% increase in the base case default level for each
notes' relevant rating stress. Under Fitch's 'AAA' stress, the
Class A notes can withstand more than 6.0x the expected base case
loss than is currently experienced. The Class B, C, D and E notes
could withstand respectively, 4.8x, 3.6x, 2.6x and 1.8x, the
expected base case loss than is currently experienced.
Due Diligence Usage
No third party due diligence was provided or reviewed in relation
to this rating action.
Data Adequacy
Fitch conducted a file review of 12 sample loan files focusing on
the underwriting procedures conducted by Certegy compared to
Certegy's credit policy at the time of underwriting. No material
discrepancies were noted in the underwriting practices of Certegy.
The file review also checked the accuracy of the data file
provided to Fitch for its rating analysis. The file review
reported no material errors that would impact Fitch's rating
analysis.
Key Rating Drivers and Expected Rating Sensitivities are further
discussed in the corresponding presale report entitled "Flexi ABS
Trust 2015-2", published today. Included as an appendix to the
report are a description of the representations, warranties, and
enforcement mechanisms.
GOLDEN UNIVERSE: First Creditors' Meeting Set For June 22
---------------------------------------------------------
A H J Wily of Armstrong Wily was appointed as administrator of
Golden Universe Investment Pty Ltd, formerly trading as Three
Beans Coffee Vanilla Mung Eastgardens, June 10, 2015.
A first meeting of the creditors of the Company will be held at
Level 5, 75 Castlereagh Street, in Sydney, on June 22, 2015, at
11:00 a.m.
TRIO CAPITAL: Advocacy Group Decries Astarra Fund De-Registration
-----------------------------------------------------------------
Malavika Santhebennur at Money Management reports that a
Wollongong-based investor advocacy group has condemned the
liquidators of the collapsed Trio Capital funds, which this week
intends to de-register a managed investment scheme Trio Capital
invested in.
According to the report, Victims of Financial Fraud (VOFF) said it
will be "disastrous" if liquidator PPB Advisory deregisters
Astarra Strategic Fund today, at a meeting in the State Library of
NSW.
Money Management relates that the Astarra Strategic fund pumped
over AUD123 million of retirement and investment savings out of
Australia, and put the money into Global Consultants and Services
Limited (GCSL), now based in Liechtenstein.
The report says the Supreme Court of NSW noted that the principal
of GCSL was at the helm of Trio Capital Group and the scheme.
VOFF said de-registration would mean no legal action can be taken
against GCSL for monetary compensation, the report relays.
"De-registration of ASF would be the end game of this massive
transnational fraud. Not only would have the criminals avoided
criminal prosecution due to the shear incompetence of ASIC but
will now be finally let off the hook completely, in regards to
restitution to the victims and the 178 million dollars the
criminals stole," the report quotes VOFF Vice President Paul
Matters as saying.
According to the report, Mr. Matters said PPB and the corporate
regulator should litigate action against GCSL to retrieve the
"stolen money".
Trio invested some assets of the funds into Astarra Strategic
Fund, with most of its assets going into so called hedge funds in
the Caribbean, the report discloses. But there is little evidence
the investments were actually made, or if they were, that they had
any real value, Money Management notes.
The Australian Prudential Regulation Authority appointed acting
trustee, and the corporate regulator cancelled Trio's licence as a
fund manager in 2009, the report adds.
About Trio Capital
Trio Capital was formerly the trustee of five superannuation
entities and the responsible entity for 25 managed investment
schemes, including the Astarra Strategic Fund. The Astarra
Strategic Fund was a fund of hedge funds, which in December 2009
had reported assets of $125 million. Investors in the Astarra
Strategic Fund included several superannuation trusts managed by
Trio Capital as well as self-managed superannuation funds and
direct investors.
The Astarra Strategic Fund invested in several questionable
overseas hedge funds, mostly based in the Caribbean. The
Australian Securities & Investments Commission commenced an
investigation into Trio Capital in October 2009 over concerns
about the legitimacy of its investments. Trio Capital was placed
into administration on Dec. 16, 2009, and on April 16, 2010, the
NSW Supreme Court ordered that the Astarra Strategic Fund be
wound up. Since this time the liquidator of Trio Capital has
been unable to recover the vast majority of the investments made
by the Astarra Strategic Fund.
Investigations into Trio Capital are continuing by both ASIC and
the Australian Prudential Regulation Authority.
* New Safe Harbour Laws May Save Insolvent Firms, Liquidator Says
-----------------------------------------------------------------
Kirsten Robb at SmartCompany reports that around one-third of
businesses liquidated could be saved and billions of dollars
recovered for the Australian economy if the government adopts
draft safe harbour recommendations from the Productivity
Commission, according to registered liquidator Sean Wengel.
Mr. Wengel, an insolvency principal at financial advisory firm
William Buck, told SmartCompany the safe harbour provisions
recommended in the Productivity Commission's draft report on the
barriers of setting up and closing a business have the potential
to save up to 3000 insolvent business from being liquidated.
The recommendations would see a provision for a 'safe harbour' to
allow company directors to explore restructuring options without
personal liability for insolvent trading, which is currently a
significant disincentive for directors, SmartCompany relates.
"The current insolvency trading laws essentially incentivise
terminating a struggling business rather than encouraging its
resurrection," SmartCompany quotes Mr. Wengel as saying.
According to the report, Mr. Wengel said when a company director
realises a company is trading as insolvent they have two options
-- appointing external administrators or shutting down.
But he said an external administration rarely helps turnaround an
insolvent business and typically triggers defaults on contracts
and creates a stigma for the business and its directors,
SmartCompany relays.
"Lots of the company's value is lost when it enters external
administration," the report quotes Mr. Wengel as saying. "It's
fair to say a large majority would prefer to save their business."
As a registered liquidator, Mr. Wengel said directors usually look
for restructuring help "when it's all too late" because of fear of
personal liability.
"They've pushed it on for too long and they have no choice but to
appoint me as liquidator. But if they'd come in 12 months prior to
work on a solution to save the business, a lot would be much
happier with the outcome," Mr. Wengel told SmartCompany.
The new provisions are slated to provide directors with a limited
period of time to seek restructuring advice to find a workable
solution for a business and avoid any personal liability in doing
so, adds SmartCompany.
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C H I N A
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ASIA FASHION: Responds to Auditor's Qualified Opinion
-----------------------------------------------------
Kelly Tay at Business Times reports that Asia Fashion Holdings'
independent auditor, Foo Kon Tan LLP, has included a qualified
opinion on the company's financial statements for the financial
year ended Dec 31, 2014.
Issues flagged include the inability to ascertain the
appropriateness of compensation claims and opening balances of the
group; unverified transactions pertaining to an associated
company; and the recoverability of loans, Business Times relates.
According to the report, Asia Fashion responded to the qualified
opinion on June 16, saying that the compensation claims relate to
the operations of Qianfeng International Ltd and its subsidiaries,
which had been disposed of by the group on Feb 3, 2015.
"The board is of the view that the compensation claims are
isolated and non-recurring in nature, relating specifically to the
disposed group, and that they would not affect the future
operations as well as the operating results of the group from
FY2015 onwards," the report quotes Asia Fashion as saying.
According to the report, Asia Fashion said this is because the
company had obtained appropriate legal and financial advice in
connection with the settlement of the compensation claims.
Arbitrators had also confirmed that the terms of the settlement
agreements were valid and enforceable.
The report relates that Foo Kon Tan LLP also said it was unable to
ascertain the recoverability of the CNY59 million (SGD12.8
million) shareholders' loan made by Asia Fashion to Rich Circles
Enterprise, which is repayable on June 18, 2016.
"The company will continually evaluate its financial position and
explore alternatives, such as the capitalisation of such
shareholders' loans together with Li Yaxin, the other major
shareholder of Rich Circles, who has also granted a loan of 51
million yuan to Rich Circles under the same terms as the loan
extended by the company. Such capitalisation will remove any
doubts as to the recoverability of these loans and will strengthen
the capital base of Rich Circles," the report quotes Asia Fashion
as saying.
Asia Fashion Holdings Limited is a China-based company engaged in
the manufacturer of functional knitted fabrics. The Company's
products include casual wear, sportswear, shoes and bags. Its
operations include knitting, dyeing and post-processing treatment
of synthetic knitted fabrics.
FUWEI FILMS: Gets Extension of NASDAQ Listing Compliance Period
---------------------------------------------------------------
Fuwei Films (Holdings) Co., Ltd., a manufacturer and distributor
of high-quality BOPET plastic films in China, on June 12 disclosed
that the Company received a letter from the Nasdaq Stock Market on
June 9, 2015 stating that while the Company had not regained
compliance with the NASDAQ Listing Rule 5550(a)(1) until June 8,
2015, it was eligible for an additional 180-day grace period,
until December 7, 2015, to regain compliance with the Bid Price
Rule.
On December 8, 2014, the Company received a letter from NASDAQ
notifying it of its failure to maintain a minimum closing bid
price of $1.00 over the then preceding 30 consecutive trading days
for its ordinary shares as required by the Bid Price Rule. The
letter stated that the Company had until June 8, 2015 to
demonstrate compliance by maintaining a minimum closing bid price
of at least $1.00 for a minimum of 10 consecutive trading days.
NASDAQ's determination was based on the Company having met the
continued listing requirement for Market Value of Publicly Held
Shares and all other applicable requirements for initial listing
on the NASDAQ Capital Market, with the exception of the Bid Price
Rule, and on the Company's written notice to NASDAQ of its
intention to cure the deficiency during the second compliance
period by effecting a reverse stock split, if necessary. If at any
time during this additional time period the closing bid price of
the Company's security is at least $1 per share for a minimum of
10 consecutive business days, NASDAQ will provide written
confirmation of compliance and this matter will be closed. If
compliance cannot be demonstrated by December 7, 2015, Staff will
provide written notification that the Company's ordinary shares
will be delisted.
At that time, the Company may appeal NASDAQ's determination to
delist its ordinary shares to a NASDAQ Hearings Panel. The Company
will monitor the closing bid price of its ordinary shares and will
consider various possible options, and, if necessary, it intends
to effect a reverse stock split, to regain compliance by the
Expiration Date.
About Fuwei Films
Fuwei Films conducts its business through its wholly owned
subsidiary, Fuwei Films (Shandong) Co., Ltd. ("Shandong Fuwei").
Shandong Fuwei develops, manufactures and distributes high-quality
plastic films using the biaxial oriented stretch technique,
otherwise known as BOPET film (biaxially oriented polyethylene
terephthalate). Fuwei's BOPET film is widely used to package food,
medicine, cosmetics, tobacco, and alcohol, as well as in the
imaging, electronics, and magnetic products industries.
HOPSON DEVELOPMENT: Moody's Affirms B3 CFR; Outlook Now Stable
--------------------------------------------------------------
Moody's Investors Service changed Hopson Development Holdings
Limited's ratings outlook to stable from negative.
At the same time, Moody's has affirmed the company's B3 corporate
family and Caa1 senior unsecured bond ratings.
"The change in outlook reflects Hopson's improved sales execution,
after the company shifted its product mix to tap into mass market
demand," says Dylan Yeo, a Moody's Analyst. "The change also
reflects Hopson's successful early redemption of its 2016 bonds; a
move which alleviates concerns over refinancing risk."
Hopson's improved sales execution in the first five months of 2015
benefitted from the ongoing changes in the company's product mix.
Contracted sales between 1 January 2015 and 30 May 2015 totaled
RMB4.6 billion, representing an increase of 190.3% on the RMB1.6
billion achieved in the same period last year.
Moody's points out that Hopson has set a contracted sales target
of RMB12 billion for all of 2015.
Moody's further points out that Hopson has been shifting its
product mix to tap into mass-market demand. For example, some of
its projects now feature smaller units.
Moody's notes that Hopson's contracted sales of RMB5.3 billion in
2014 was exceptionally weak relative to prior years, because of
the transition period required to change its products to suit its
mass market customers. By contrast, the company recorded
contracted sales totaling RMB12.0-RMB14.5 billion per annum during
2010-2013.
Nonetheless, its near-term refinancing risk has fallen, after
Hopson redeemed in May 2015 its $300 million senior notes maturing
in 2016. The redemption was funded by mortgage loans on its
investment properties in Guangzhou and Beijing.
The company faces no imminent offshore bond maturities until 2018.
"However, while Hopson's change in product mix will support sales
volumes, the company will face further margin compression and its
financial metrics will take time to recover," adds Yeo, who is
also the Lead Analyst for Hopson.
Moody's expects that Hopson's margins will narrow in 2015 and
2016, because its average selling price fell to RMB12,702 per sqm
in 2014 from RMB17,205 per sqm in 2013.
During the first five months of 2015, the company registered an
average selling price of 12,545 per sqm.
Moody's expects that Hopson's credit metrics will improve only
starting in 2016, because the weak contracted sales in 2014 will
affect its revenue recognition in 2015.
In 2015, Moody's expects that Hopson will record a homebuilding
EBIT interest coverage of 1.5x-2.0x, and a revenue-to-debt of 15%-
20%, after recording a higher homebuilding EBIT interest coverage
of 2.0x in 2014 and a higher revenue-to-debt of 34% in the same
period.
Moody's also points out that Hopson's B3 corporate family rating
reflects its constrained liquidity position, as a result of its
large proportion of bank loans with short maturities.
The company's cash balance -- including restricted cash -- totaled
HKD6.7 billion at end-2014. By contrast, its bank loans total
HKD12.6 billion in 2015 and HKD11.8 billion in 2016.
In addition, its cash-to-short term debt of 53.1% is weak relative
to industry peers.
Nevertheless, refinancing risk is partly offset by the company's
longstanding banking relationships and its investment properties.
Its high-quality land bank can also be used as collateral for
loans.
At end-2014, the company's land bank totaled 33 million sqm and
was spread across Guangzhou, Huizhou, Beijing, Tianjin, Shanghai
and Ningbo.
The size of its land bank is large relative to its domestic peers
in the B rating range. Its land bank is also large when compared
to its contracted sales volume over the last five years of about
400,000-600,000 sqm of gross floor area per annum.
The stable ratings outlook reflects Moody's expectation that
Hopson will demonstrate: (1) improved sales execution; (2) a
successful implementation of its business strategy; in particular,
in changing its product offering to tap into mass-market demand;
and (3) a successful refinancing of its short-term bank loans.
The ratings could be upgraded if Hopson: (1) improves its
liquidity position, such that its unrestricted cash adequately
covers its short-term debt; (2) achieves sustained improvements in
contracted sales; and (3) improves its interest coverage, such
that its homebuilding EBIT interest coverage exceeds 1.5x-2.0x on
a sustained basis.
The ratings could be downgraded if: (1) Hopson's liquidity
position deteriorates, as evidenced by declining cash, or rising
short-term debt levels; (2) the company experiences material
declines in its contracted sales and profit margins; and (3) its
homebuilding EBIT interest coverage falls below 1.0x.
The principal methodology used in these ratings was Homebuilding
And Property Development Industry published in April 2015.
Revenue/debt and EBIT interest coverage ratios are calculated
based on Moody's standard adjustments and the definition stated in
this methodology. Debt does not include adjustments for mortgage
guarantees.
Hopson Development Holdings Limited is one of the largest property
developers in China. Its land bank totaled 33 million square
meters in gross floor area at end-2014.
The company's principal business interest is in the development of
residential properties in the four major cities of Guangzhou,
Beijing, Shanghai, and Tianjin, as well as in the areas
surrounding these four cities.
* CHINA: Risks 'Real Damage' to Economy, Hank Paulson Says
----------------------------------------------------------
Tom Mitchell at FT.com reports that the Chinese government risks
"real damage" to the economy if it does not hasten reform of
China's state-owned enterprises and overhaul a debt-fuelled growth
model, Hank Paulson has warned.
For more than two decades the former US Treasury secretary and
Goldman Sachs chief has worked closely with pivotal Chinese
political figures such as Wang Qishan, currently head of the
Chinese Communist party's anti-graft bureau, and visits Beijing
frequently, FT.com says.
"Until the state-owned enterprises are put on a level and
competitive playing field, it's going to be difficult to have the
marketplace work efficiently in some key sectors of the economy,"
Mr. Paulson told the Financial Times during a visit to the Chinese
capital. "Reform of the SOEs has been moving too slowly."
At a party conclave in 2013, President Xi Jinping pledged that
market forces would play a "decisive role" in the Chinese economy,
presaging what appeared to be a renewed drive to reform the state
companies that still dominate critical sectors such as energy,
finance and telecommunications, says FT.com.
But two years later there has been little progress on state-sector
reform even as economic growth slows to its lowest level in a
quarter-century and overall debt levels, now at 250 per cent of
gross domestic product, continue to climb, according to FT.com.
A banker in the mid-1990s, Mr. Paulson was involved in the initial
public offerings of state giants such as China Mobile, now the
world's largest mobile network operator, on the Hong Kong stock
exchange, the report says.
But the Chinese government typically retained more than three-
quarters of their equity and is reluctant to allow private
competition in so-called "strategic sectors", let alone sell down
its stakes in the companies that occupy the commanding heights of
the economy, FT.com states.
"[Jobs and growth] have to come from the private sector," the
report quotes Mr. Paulson as saying. "You have to free up sectors
like finance and energy and telecommunications and really open up
the services market. There will be real magic when they do that."
FT.com says that in its effort to contain the country's dangerous
debt bubble, Beijing has recently authorised local governments to
issue bonds for the first time in order to refinance an estimated
CNY22 trillion (US$3.5 tril.) worth of off-balance sheet debts run
up by local government finance vehicles. In the wake of the global
financial crisis, the central government looked the other way as
such vehicles borrowed heavily to invest in infrastructure and
prop up overall economic growth, the report relates.
"The leverage at municipal level is not sustainable," Mr Paulson
told FT.com. "There are obviously some real losses there. Today
they are manageable, but the longer you prolong this there's a
much greater danger that this will spill over and do real damage
to the economy."
According to FT.com, the former US Treasury secretary pointed to a
Bilateral Investment Treaty currently being negotiated by Beijing
and Washington as an important potential "lever" for further
reform, similar to how then-Chinese premier Zhu Rongji used
accession to the World Trade Organisation to force painful reforms
on reluctant state firms and bureaucrats in the late 1990s.
FT.com. citing people close to the BIT discussions, relates that
the two sides have recently exchanged "negative lists" that would
clearly define which areas in each country are off-limits to
foreign investment.
The report notes that the US is pushing for "ambitious" or short
negative lists that could rekindle enthusiasm among multinationals
frustrated by Chinese market access restrictions and a much
tougher regulatory environment.
"Because it's become more challenging to do business in China, [US
companies] are no longer such vocal advocates for the importance
of the US-China economic relationship," Mr. Paulson, as cited by
FT.com, said. "Congress is hearing about the problems rather than
the opportunities."
================
H O N G K O N G
================
NORD ANGLIA: Moody's Assigns (P)B1 Rating to CHF235MM New Bonds
---------------------------------------------------------------
Moody's Investors Service assigned a provisional (P)B1 rating to
Nord Anglia Education, Inc (NAE, B1 Stable)'s proposed CHF235
million senior secured bonds. The bonds are to be issued by Nord
Anglia Education Finance LLC, guaranteed by NAE, and will rank
pari passu and pro rata with the existing credit facilities.
The provisional status of the rating will be removed upon the
closing of the transaction at the expected terms and conditions,
and upon the receipt of final documentation.
The outlook for the ratings is stable.
These actions conclude the review with direction uncertain, which
was initiated on 27 April 2015 in response to NAE's announcement
that it had entered into a definitive agreement with Meritas
Schools Holdings, LLC (B3 stable) to acquire six schools.
NAE will acquire the six schools for an aggregate purchase price
of approximately $575 million. NAE is funding the transaction with
$125 million in equity issuance, a $200 million increase in its
existing term loan B, issuance of the CHF bonds, and existing
cash.
"The acquisition will increase NAE's financial leverage, but the
company's stable, predictable business model and high profit
margins support the B1 corporate family rating," said Joe
Morrison, a Moody's Vice President and Senior Analyst. "The
secured credit facility and the secured bonds constitute the only
debt in the company's capital structure and are therefore rated at
the same level as the corporate family rating."
The stable outlook is based on expectation that NAE's financial
leverage will fall to a level that is in line with the B1 rating
category over the next 12-18 months absent large-scale, debt-
funded acquisitions.
Positive pressure on the ratings could develop if the company's
utilization rate and revenue per student improve, leading to the
adjusted debt to EBITDA ratio staying below 4.5x-5.0x, and the
company establishes a track record of pursuing acquisitions in a
more conservative manner.
Negative pressure on the ratings could arise if business
conditions deteriorate and/or the company undertakes large-scale
acquisitions such that its leverage -- as measured by adjusted
debt to EBITDA -- does not trend down to 6.0x over the next 12-18
months. Furthermore, a material deterioration in the company's
liquidity position would heighten downward pressure on the
ratings.
The principal methodology used in this rating was Business and
Consumer Service Industry published in December 2014.
Nord Anglia Education, Inc. is headquartered in Hong Kong and
operates 35 international premium schools in Asia, Europe, the
Middle East, and North America, with over 23,900 students ranging
in level from pre-school through to secondary school. NAE also
provides outsourced education and training contracts with
governments and curriculum products through its Learning Services
division. For the 12 months ended 28 February 2015, NAE generated
revenues of $521 million.
=========
I N D I A
=========
AGARWAL EDUCATION: CARE Revises Rating on INR12.61cr Loan to B+
---------------------------------------------------------------
CARE revises the rating assigned to the bank facilities of Agarwal
Education and Research Society.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long-term Bank Facilities 12.61 CARE B+ Revised from
CARE B
Rating Rationale
The revision in the rating assigned to the bank facilities of
Agarwal Education and Research Society (AERS) takes into
account continuous growth in its scale of operations marked by
increasing Total Operating Income along with improvement in its
surplus margin and successful completion of its phase II of debt-
funded capex during FY15 (refers to the period April 1 to
March 31).
The rating, however, continues to remain constrained on account of
AERS's relatively modest scale of operations in the education
industry, its moderately leveraged capital structure and moderate
liquidity position. The rating further continues to be constrained
on account of the increasing level of competition in the education
sector from other colleges and high regulatory restrictions
applicable to educational institutes in India.
The rating, however, continues to draw strength from qualified
management with adequate infrastructure facilities in its
institute.
AERS's ability to increase its scale of operations thorough
improvement in enrolment ratio while maintaining its
profitability along with improvement in its capital structure
would remain the key rating sensitivities.
Jaipur-based (Rajasthan) AERS is registered as a society in 2010
with an objective to impart education. AERS is promoted and
managed by Mr Ramesh Agarwal along with his family members. AERS
runs an institute named Advait Vedanta Institute of Technology
(ADVED) spread over 20 acres of land area at Jaipur. ADVED offers
degree courses of engineering at graduate level in the field of
Civil Engineering, Mechanical Engineering, Electrical Engineering,
Electronics and Communication Engineering and Computer Science and
polytechnic diploma in the field of Civil Engineering and
Mechanical Engineering. The institute is affiliated with Rajasthan
Technical University (RTU) Kota and Board of Technical Education
(BTE), Rajasthan and approved by All India Council of Technical
Education (AICTE), Directorate of Technical Education (Rajasthan)
& BTE (Rajasthan).
As per FY15 provisional result, AERS has reported a total
operating income of INR5.31 crore (FY14: INR4.06 crore) with
surplus of INR0.09 crore (FY13: INR0.08 crore).
AMBICA TIMBER: ICRA Reaffirms B+ Rating on INR10cr Cash Credit
--------------------------------------------------------------
ICRA has reaffirmed the long term rating of [ICRA]B+ to the cash
credit facilities converted from earlier limit of INR2.70 crore to
INR10.00 crore as a sublimit of LC of Ambica Timber Mart. ICRA has
also reaffirmed the short term rating of [ICRA]A4 to the INR17.70
crore (enhanced from INR15.00 crore) non fund based Letter of
Credit (LC) and INR0.90 crore credit exposure facility of ATM. The
total limit utilization should not exceed INR18.60 crore at any
point of usage.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Fund Based - Cash
Credit (10.00) [ICRA]B+ reaffirmed
Non Fund Based-
Letter of Credit 17.70 [ICRA]A4 reaffirmed
Non Fund Based-
Credit Exposure 0.90 [ICRA]A4 reaffirmed
The reaffirmation of Ambica Timber Mart's (ATM) ratings continues
to take into account the relatively modest scale of operations as
well as the exposure of the firm's profitability to volatility in
timber price movements and currency exchange rates. Further, the
ratings are also constrained by a highly competitive business
environment due to low entry barriers, the limited value addition
in the trading business and the very high working capital
intensity of operations on account high inventory levels. ICRA
also notes that ATM is a partnership firm and any significant
withdrawals from the capital account will affect its capital
structure. Further, ICRA notes that the recent ban on export of
timber logs (Gurjan) by Myanmar government has adversely impacted
its sourcing from that country. However, the company is trying to
mitigate the same by increasing its imports for other varieties
from other countries.
The ratings, however, continue to draw comfort from the
established track record of the promoters in the business of
timber trading and stable demand outlook for teakwood in the
country.
Ambica Timber Mart (ATM) was incorporated in 1969 by Mr.
Gangarambhai V Patel. In 1989, his son, Mr. Chandrakant Patel,
joined the business and currently the business is run by his
younger brother Mr. Kaushal Patel. The firm works as a trader
buying imported wood and selling it to retailers and saw mills.
The firm's facilities are located at Ahmedabad (Gujarat) and ATM
also has a land area on lease near Kandla port.
Recent Results
In FY15 (provisional unaudited financials), ATM reported an
operating income of INR14.47 crore (as against INR10.45 crore
during FY14) and net profit of INR1.06 crore (as against net
profit of INR1.13 crore during FY14).
ANIIRUDH ENTERPRISES: CRISIL Reaffirms D Rating on INR46MM Loan
---------------------------------------------------------------
CRISIL's rating on the bank facilities of Aniirudh Enterprises
(AE) continue to reflect instances of delay by AE in servicing its
debt; the delays have been caused by the company's weak liquidity.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Cash Credit 46 CRISIL D (Reaffirmed)
Term Loan 4 CRISIL D (Reaffirmed)
The rating also reflects the high degree of geographical
concentration in AE's order book and its exposure to intense
competition in the construction industry. However, the firm
benefits from its promoters' extensive industry experience.
AE was set up as a proprietorship firm in 1998 by Mr. Vivek
Ramchandra Kawde. The firm is engaged in the construction of roads
and tunnels in Maharashtra and Karnataka. The promoters
incorporated Aniirudh Civil Engineers and Contractors Pvt Ltd
(rated 'CRISIL D/CRISIL D') in 2011; this company is engaged in
jetty construction and stone crushing.
BALWAS REALITY: CARE Assigns B+ Rating to INR10.02cr LT Loan
------------------------------------------------------------
CARE assigns 'CARE B+' rating to the long-term bank facilities of
Balwas Reality & Infrastructure Pvt. Ltd.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long-term Bank Facilities 10.02 CARE B+ Assigned
Rating Rationale
The rating assigned to the bank facilities of Balwas Realty &
Infrastructure Pvt. Ltd. (BRI) is constrained by revenue being
small and concentrated to a single customer, moderate
profitability margins, significant investments in group entity
which is yet to commence operations, leveraged capital structure
and weak debt coverage indicators. The rating factors in
experienced and resourceful promoters along with established track
record of the Balwa group in the real estate industry.
The ability of BRI to maintain healthy occupancy on its leased
premises and subsequently timely receive lease rentals along with
successful receipt of cash flows from group entity are the key
rating sensitivities.
Incorporated in 1986, BRI is engaged into leasing of commercial
space. The company has constructed two buildings at Kashi Mira,
Thane, viz, Indiplex I (28,577.10 built-up area) and Indiplex II
(17,300.95 built-up area), which have been entirely leased to
Eagle Burgmann India Private Limited (EBIPL).
During FY14, BRI has posted a total operating income of INR5.11
crore (vis-a-vis INR4.56 crore in FY13) and loss of INR1.04
crore (vis-a-vis loss of INR0.20 crore in FY13). Furthermore, the
company has posted total operating income of INR5.09 crore and PAT
of INR0.38 crore in FY15 (Provisional).
BASAVESHWAR ELECTRICALS: CRISIL Reaffirms B+ INR75MM Loan Rating
----------------------------------------------------------------
CRISIL has assigned its 'CRISIL A4' rating to the short-term bank
facilities of Basaveshwar Electricals Pvt Ltd (BEPL) and
reaffirmed its rating on the company's long-term bank facilities
at 'CRISIL B+/Stable'.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Bank Guarantee 30 CRISIL A4 (Assigned)
Proposed Long Term
Bank Loan Facility 75 CRISIL B+/Stable (Reaffirmed)
Cash Credit 45 CRISIL B+/Stable(Reaffirmed)
The ratings reflect BEPL's modest scale of operations and large
working capital requirements. These rating weaknesses are
partially offset by the extensive experience of the company's
promoter in the power-related services industry.
Outlook: Stable
CRISIL believes that BEPL will continue to benefit over the medium
term from its promoter's extensive industry experience. The
outlook may be revised to 'Positive' if the company achieves
significant and sustained improvement in its revenue and
profitability while maintaining its capital structure. Conversely,
the outlook may be revised to 'Negative' if BEPL's revenue or
margins decline significantly, or if its working capital cycle
lengthens, or if it undertakes any large debt-funded capital
expenditure programme, resulting in weakening of its financial
risk profile.
BEPL, incorporated in April 2013 by Mr. M V Gachinmath, is an
engineering, procurement, and construction (EPC) contractor. It
sets up substations and transmission lines for state power
transmission and distribution utilities in Karnataka. Mr.
Gachinmath has been engaged in this industry for over two decades
and earlier conducted the business through his proprietorship
concern Basaveshwar Electricals and Engineers. However, with the
formation of BEPL, all business will be undertaken by this
company. BEPL's registered office is in Bijapur (Karnataka).
C.P. FOODS: CRISIL Reaffirms B+ Rating on INR55MM Loan
------------------------------------------------------
CRISIL's rating on the long-term bank facilities of C.P. Foods
(CPF) continues to reflect CPF's below-average financial risk
profile marked by high total outside liabilities to tangible net
worth (TOLTNW) ratio, small net worth, and average debt protection
metrics, and the customer concentration in its revenue profile.
These rating weaknesses are partially offset by its management's
extensive experience in the agricultural commodities trading
business.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Overdraft Facility 55 CRISIL B+/Stable (Reaffirmed)
Term Loan 3.5 CRISIL B+/Stable (Reaffirmed)
Outlook: Stable
CRISIL believes that CPF will continue to benefit over the medium
term from its promoters' extensive industry experience. The
outlook may be revised to 'Positive' if the firm reports
significantly high revenue and profitability, leading to healthy
cash accruals, and improvement in TOLTNW ratio. Conversely, the
outlook may be revised to 'Negative' if CPF's working capital
management worsens, or if it undertakes a large debt-funded
capital expenditure programme, or if its profitability declines,
weakening its financial risk profile.
Established in 2001, CPF is a partnership firm engaged in trading
and processing of pulses, including masoor dal, toor dal, udad
dal, moong dal, yellow peas, and chick peas. The firm primarily
caters to the domestic market. Its day-to-day operations are
managed by promoters Mr. E Jawahar, Mr. E Kathirvel, Mr. E
Rajavel, and Mr. Manikanda Prabhu. CPF has its processing unit in
Virudhunagar (Tamil Nadu).
CHAUDHARY NURSING: CARE Assigns 'B+' Rating to INR1cr LT Loan
-------------------------------------------------------------
CARE assigns 'CARE B+' and 'CARE A4' ratings to the bank
facilities of Chaudhary Nursing Homes Private Limited.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long-term Bank Facilities 1 CARE B+ Assigned
Short-term Bank Facilities 6 CARE A4 Assigned
Long-term/Short-term Bank 0.50 CARE B+/CARE A4
Facilities Assigned
Rating Rationale
The ratings assigned to the bank facilities of Chaudhary Nursing
Homes Private Limited (CNH) are primarily constrained by its small
scale of operations with low net-worth base and elongated
collection period resulting into stressed liquidity. The ratings
are further constrained due to reputation risk, its presence in
highly competitive industry and dependence on a single operational
facility.
These rating constraints are partially offset due to experienced
and qualified promoters in the healthcare industry, healthy
profitability, moderate capital structure and debt coverage
indicators.
Going forward, the ability of the company to increase its scale of
operation while sustaining profitability and timely realization of
its debtors are the key rating sensitivities.
Noida-based CNH (Uttar Pradesh) was incorporated in 1988 by Mr V.
S Chaudhary. Initially, CNH was running its operations with a
nursing home in Sector 19, Noida, Uttar Pradesh. In 2003, the
company relocated its operations to a new hospital property in
Sector 27, Noida (Uttar Pradesh) by the name of 'Vinayak
Hospital'. Vinayak Hospital is a 150-bed multi-specialty hospital
with present operational bed inventory of 104 as on March 31,
2015. The hospital provides numerous services such as general
surgery, gynaecology, orthopedics, E.N.T and treatments in
cardiology, nephrology and neurosurgery. The hospital has
empanelment with the central government for its Central Government
Health Scheme (CGHS) and state government for Ex-Servicemen
Contributory Health Scheme (ECHS). Furthermore, the hospital also
has third party agreements (TPA's) with various insurance
companies.
Apart from providing medical services, some space in the hospital
building has been rented for chemist shop and automated teller
machine (ATM).
In FY14 (refers to the period April 1 to March 31), CNH has
achieved a total operating income (TOI) of INR9.55 crore with
PBILDT and net profit (PAT) of INR 2.95 crore and INR0.88 crore,
respectively, as against TOI of INR8.76 crore, PBILDT of
INR2.71 crore and PAT of INR0.86 crore in FY13. Furthermore,
during FY15, the company achieved TOI of INR7.20 crore till
December 31, 2015.
COT TEXTILES: CRISIL Suspends D Rating on INR430MM LT Loan
----------------------------------------------------------
CRISIL has suspended its ratings on the bank facilities of Spin-
Cot Textiles Private Limited (SCTPL).
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Cash Credit 300 CRISIL D
Inland/Import Letter 100 CRISIL D
of Credit
Long Term Loan 430 CRISIL D
The suspension of ratings is on account of non-cooperation by
SCTPL with CRISIL's efforts to undertake a review of the ratings
outstanding. Despite repeated requests by CRISIL, SCTPL is yet to
provide adequate information to enable CRISIL to assess SCTPL's
ability to service its debt. The suspension reflects CRISIL's
inability to maintain a valid rating in the absence of adequate
information. CRISIL considers information availability risk as a
key credit factor in its rating process and non-sharing of
information as a first signal of possible credit distress, as
outlined in its criteria 'Information Availability Risk in Credit
Ratings'.
Incorporated in 2005 and promoted by Mr. Ghanta Kameswara Rao in
Guntur (Andhra Pradesh), SCTPL manufactures cotton yarn and trades
in raw cotton.
DELHI MSW: Ind-Ra Withdraws Issuer Rating of 'IND BB-(Suspended)'
-----------------------------------------------------------------
India Ratings and Research has withdrawn Delhi MSW Solutions
Limited's Long-Term Issuer Rating of 'IND BB-(suspended)'.
The ratings have been withdrawn due to lack of adequate
information. Ind-Ra will no longer provide ratings or analytical
coverage for DMSWSL.
Ind-Ra suspended DMSWSL's ratings on Nov. 28, 2014.
DMSWSL's ratings:
-- Long-Term Issuer Rating: 'IND BB-(suspended)'; rating
withdrawn
-- INR66 mil. fund-based working capital limits: 'IND
BB-(suspended)'/'IND A4+(suspended)'; ratings withdrawn
-- INR198.2 mil. non-fund-based limits: 'IND A4+(suspended)';
rating withdrawn
-- INR251.6 mil. term loans: 'IND BB-(SO)(suspended)'; rating
withdrawn
-- INR1,798.6 mil. term loans: 'IND BB-(suspended)'; rating
withdrawn
DEY'S COLD: CRISIL Suspends 'B' Rating on INR60MM Cash Loan
-----------------------------------------------------------
CRISIL has suspended its rating on the bank facilities of
Dey's Cold Storage Private Limited (DCS).
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Cash Credit 60 CRISIL B/Stable
Term Loan 40 CRISIL B/Stable
The suspension of ratings is on account of non-cooperation by DCS
with CRISIL's efforts to undertake a review of the ratings
outstanding. Despite repeated requests by CRISIL, DCS is yet to
provide adequate information to enable CRISIL to assess DCS's
ability to service its debt. The suspension reflects CRISIL's
inability to maintain a valid rating in the absence of adequate
information. CRISIL considers information availability risk as a
key credit factor in its rating process and non-sharing of
information as a first signal of possible credit distress, as
outlined in its criteria 'Information Availability Risk in Credit
Ratings'
DCS was incorporated in 2002 by Mr. Deepak Dey and his family. It
is engaged in storage, preservation and trading of potatoes. The
company owns a cold storage unit located in Hailakandi, Assam, and
is setting up another unit in Karimganj, Assam.
GEO AQUATIC: CRISIL Assigns B+ Rating to INR49.6MM Bill Disc.
-------------------------------------------------------------
CRISIL has assigned its 'CRISIL B+/Stable/CRISIL A4' ratings to
the bank loan facilities of Geo Aquatic Products Private Limited
(GAPPL).
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Term Loan 37.8 CRISIL B+/Stable
Bill Discounting 49.6 CRISIL B+/Stable
Packing Credit 20.0 CRISIL A4
The ratings reflect GAPPL's modest scale of operations in the
highly fragmented seafood industry and its working capital
intensive operations. These rating strengths are partially offset
by the experience of the promoters in the seafood industry.
Outlook: Stable
CRISIL believes that GAPPL will maintain its credit risk profile
over the medium term backed by its extensive experience of its
promoters in the seafood business. The outlook may be revised to
'Positive' in case of higher revenues and cash accruals leading to
improvement in its credit risk profile. Conversely, the outlook
may be revised to 'Negative' if the company undertakes any large
debt-funded capital expenditure or lower cash accruals leading to
deterioration in financial risk profile.
Incorporated in 1998, GAPPL is engaged in the business of
processing and export of shrimp. The company has its processing
and exporting unit located at Alappuzha (Kerala). The day to day
operations of the company is managed by Mr. C.A. Salim.
HES INFRA: Ind-Ra Suspends 'IND BB-' Long-Term Issuer Rating
------------------------------------------------------------
India Ratings and Research has suspended HES Infra Pvt Ltd's
'IND BB-' Long-Term Issuer Rating with a Stable Outlook. The
rating will now appear as 'IND BB-(suspended)' on the agency's
website.
The ratings have been suspended due to lack of adequate
information. Ind-Ra will no longer provide ratings or analytical
coverage for HES.
The ratings will remain suspended for a period of six months and
be withdrawn at the end of that period. However, in the event the
issuer starts furnishing information during this six-month period,
the ratings could be reinstated and will be communicated through a
rating action commentary.
HES' ratings are:
-- Long-Term Issuer Rating: migrated to 'IND BB-(suspended)'
from 'IND BB-'/Stable
-- INR600 mil. term loan limits: migrated to 'IND BB-
(suspended)' from 'IND BB-'/Stable
-- INR900 mil. fund-based working capital limit: migrated to
'IND BB-(suspended)' from 'IND BB-'/Stable and to
'IND A4+(suspended)' from 'IND A4+'
-- INR3,140 mil. non-fund-based working capital limit:
migrated to 'IND A4+(suspended)' from 'IND A4+'
-- Proposed INR1,360 mil. non-fund-based working capital
limit: 'Provisional IND A4+'; rating withdrawn as the
company did not proceed with the instrument as envisaged
INDIA FROZEN: Ind-Ra Affirms 'IND B+' Long-Term Issuer Rating
-------------------------------------------------------------
India Ratings and Research has affirmed India Frozen Foods' Long-
Term Issuer Rating at 'IND B+'. The Outlook is Stable. Rating
actions on IFF's bank loans are:
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Term loan 42.97 Assigned Final Long-Term
(reduced from 72.50) 'IND B+'/Stable
Term loan 7.50 'IND B+'; rating withdrawn
as the loan was paid in
full
KEY RATING DRIVERS
The ratings continue to be constrained by IFF's small scale of
operations even though the top-line increased to INR403.82 mil.
according to the provisional financials for FY15 (FY14:
INR80.97 mil.). The ratings are also constrained by the
partnership structure of the firm. Moreover, the firm reported
negative cash flow from operation of INR17.11 mil. in FY15 (FY14:
INR4.16 mil.).
The ratings factor in IFF's moderate credit metrics with interest
coverage (operating EBITDA/gross interest expense) of 2.3x in FY15
(FY14: 1.59x) and financial leverage (total adjusted
debt/operating EBITDAR) of 2.9x (4.22x). The ratings also factor
in the firm's moderate EBITDA margins of 6.08% in FY15 (FY14:
10.66%).
The ratings are supported by a decade-long experience of IFF's
promoters in processing frozen meat, bone mill and raw meat.
RATING SENSITIVITIES
Negative: A sustained decline in the operating margins leading to
weaker credit metrics will be negative for the ratings.
Positive: A significant improvement in the revenue while
maintaining or improving the credit profile will be positive for
the ratings.
IFF was established in 2008 and is engaged in processing frozen
meat, bone mill and raw meat. The company is located in Sambhal
(Uttar Pradesh).
J.S. INTERNATIONAL: Ind-Ra Assigns 'IND BB+' LT Issuer Rating
-------------------------------------------------------------
India Ratings and Research has assigned J.S. International a Long-
Term Issuer Rating of 'IND BB+'. The Outlook is Stable. The
agency has also assigned JSIN's bank loans these ratings:
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Term loan (outstanding) 86 'IND BB+'/Stable
Fund-based limits 800 'IND BB+'/Stable/'IND A4+'
KEY RATING DRIVERS
The ratings are constrained by the regulatory risks JSIN faces due
to its presence in the animal slaughtering and meat processing
industry. There are no restrictions on buffalo slaughter in most
of the Indian states; any such regulation on buffalo slaughter
might impact the company adversely. JSIN's operations are also
susceptible to shutdowns emanating from local religious customs
and pollution concerns. The ratings factor in the partnership
nature of the firm, which limits its financial flexibility.
Liquidity is also stressed as reflected in the near-full working
capital utilization for the 12 months ended March 2015. Moreover,
EBITDA margins were subdued in FY14 (3.7%) due to high operating
expenses on the increased buffalo prices and domestic inflationary
pressures.
The ratings are also limited by intense price competition from
large domestic and global players. Brazil being the closest
competitor, any depreciation in the Brazilian Real against the US
dollar poses a huge challenge to the price competitiveness of
Indian buffalo meat.
The ratings are further constrained by the company's substantial
forex exposure (around 90% of revenue is from exports). However,
the forex risk is mitigated as it works on 30% advance payments
and also avails foreign bill discounting/post-shipment limits in
foreign currency.
The ratings factor in JSIN's moderate scale of operations as
revenue grew at a CAGR of over 50% over FY11-FY14, supported by an
increase in meat volumes and the prices in the global market.
However, revenue declined about 30% yoy in FY15 because of trade
restrictions to China and shutdown of the slaughter house due to
local religious reasons. The hampered availability of livestock
in sowing/harvesting season (May-June) affecting capacity
utilization is also a concern.
Ind-Ra expects the revenue to recover in FY16, driven by the
increased demand of Indian meat in international markets due to
better quality standards, an improvement in transportation and
storage practices and competitive pricing.
RATING SENSITIVITIES
Negative: A negative rating action could result from a substantial
decline in the revenue and profitability resulting in sustained
deterioration of the credit metrics.
Positive: A positive rating action could result from the
sustenance of revenue and profitability resulting in a sustained
improvement in the credit metrics.
JSIN operates an integrated meat processing plant in Unnao, Kanpur
since 2006. The firm produces and exports frozen halal boneless
buffalo meat, sheep meat and leather dog chews with capacity of
105MT, 6MT and 3.85MT per day, respectively. It complies with ISO
22000-2005 Certificate, HACCP Certificate, Halal Certificate; all
products have been approved by Agricultural and Processed Food
Products Export Development Authority. JSIN reported revenue of
INR6.7bn, EBITDA of
INR249 mil. and net income (before taxes) of INR112 mil. in FY14.
KHADEEJA CASHEW: CRISIL Assigns 'B' Rating to INR40MM Cash Loan
---------------------------------------------------------------
CRISIL has assigned its 'CRISIL B/Stable' rating to the long-term
bank facilities of Khadeeja Cashew Traders (KCT). The rating
reflects KCT's small scale of operations and weak financial risk
profile, marked by small net worth, moderately high total outside
liabilities to tangible net worth ratio and weak debt protection
metrics.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Cash Credit 40 CRISIL B/Stable
Long Term Loan 15 CRISIL B/Stable
These rating weaknesses are partially offset by the extensive
experience of KCT's promoter in the cashew industry.
Outlook: Stable
CRISIL believes that KCT will continue to benefit over the medium
term from its promoter's extensive industry experience. The
outlook may be revised to 'Positive' if the firm records
considerable increase in revenues and profitability coupled with
an improvement in its capital structure. Conversely, the outlook
may be revised to 'Negative' if the firm's cash accruals decline
on account of lower than expected revenues or profitability or if
the firm undertakes a considerable debt-funded capital expenditure
programme, weakening its financial risk profile.
Set up in 1998 by Mr. Niyas T, KCT trades in raw cashew nuts and
processes cashew kernels. KCT has its processing facilities in
Kollam (Kerala).
The firm reported a PAT of INR1 million on operating income of
INR178 million for 2013-14 (refers to financial year from April 1
to March 31); it reported a PAT of INR1 million on operating
income of INR181 million for 2012-13.
KRISHNA TECHNOCHEM: CRISIL Reaffirms 'B' Rating on INR42.5MM Loan
-----------------------------------------------------------------
CRISIL's ratings on the bank facilities of Krishna Technochem Pvt
Ltd (KTPL) continue to reflect KTPL's below-average financial risk
profile, marked by small net worth, weak debt protection metrics,
and moderate gearing, and exposure to risks related to volatility
in crude oil prices.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Bank Guarantee 2.5 CRISIL A4 (Reaffirmed)
Cash Credit 42.5 CRISIL B/Stable (Reaffirmed)
Letter of Credit 20 CRISIL A4 (Reaffirmed)
Letter of Credit 20 CRISIL B/Stable (Reaffirmed)
These rating weaknesses are partially offset by the extensive
experience of KTPL's promoters in the petrochemicals industry and
established relationship with suppliers and customers.
Update
KTPL's sales are estimated at INR377 million in 2014-15 (refers to
financial year, April 1 to March 31) as against INR283.0 million
in the previous year. The improvement has been on account of
higher inflow of orders. Its operating margin has remained low but
stable, over the past five years, in the range of 3.4-4.7 times,
and is estimated to be 3.4 per cent for 2014-15.
KTPL has moderate working capital requirements, as reflected in
gross current assets (GCAs) estimated at 136 days as on March 31,
2015, along with receivables, inventory and payables estimated at
33 days, 70 days and 43 days respectively as on the same date. The
company funds its working capital requirements through short-term
bank borrowings. Its bank limits were utilised at an average of 93
per cent over the 12 months through March 2015.
KTPL's financial risk profile remains moderate, marked by modest
net worth, moderate debt protection metrics, and gearing. Its net
worth and gearing are estimated at INR44 million and 1.42 times,
respectively, as on March 31, 2015; its interest coverage ratio is
estimated at 1.46 times and net cash accruals to total debt
(NCATD) ratio is estimated at 0.05 times, for 2014-15.
Outlook: Stable
CRISIL believes that KTPL will continue to benefit over the medium
term from its promoters' extensive industry experience and
longstanding relationship with its suppliers and customers. The
outlook may be revised to 'Positive' if KTPL's liquidity improves,
most likely because of improved working capital management or
higher cash accruals driven by improvement in profitability.
Conversely, the outlook may be revised to 'Negative' if KTPL's
financial risk profile, particularly liquidity, weakens further,
most likely because of stretch in working capital or larger-than-
expected debt-funded capital expenditure.
Incorporated in 1994, KTPL manufactures petrochemicals such as
organic composite solvent oil (OCS), crude mineral oil bottom, and
benzene. More than 80 per cent of the company's total revenue is
generated through the sale of OCS. KTPL's manufacturing unit is in
Howrah (West Bengal).
M.J. INDUSTRIES: CRISIL Reaffirms 'B' Rating on INR70MM Cash Loan
-----------------------------------------------------------------
CRISIL's rating on the long-term bank facility of M.J. Industries
(MJI) continues to reflect MJI's weak financial risk profile,
marked by high gearing and weak debt protection metrics, and small
scale of and working-capital-intensive operations in the
fragmented rice industry. These rating weaknesses are partially
offset by the partners' experience in the rice milling and
processing industry.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Cash Credit 70 CRISIL B/Stable (Reaffirmed)
Proposed Long Term
Bank Loan Facility 10 CRISIL B/Stable (Reaffirmed)
Term Loan 12.5 CRISIL B/Stable (Reaffirmed)
Outlook: Stable
CRISIL believes that MJI will maintain its business risk profile
over the medium term, backed by its partners' extensive industry
experience. The outlook may be revised to 'Positive' in case of
significant improvement in the firm's financial risk profile, most
likely driven by capital infusion or improved working capital
cycle or ramp up in its scale of operations. Conversely, the
outlook may be revised to 'Negative' if MJI's financial risk
profile weakens, most likely due to significant increase in
inventory, leading to large incremental bank borrowings, or debt-
funded capital expenditure or decline in sales.
MJI is a partnership firm set up in 1998 by Mr. Kewal Krishna, Mr.
Pawan Kumar, and Mr. Rakesh Kumar. The firm mills and processes
paddy into basmati rice. It has an installed paddy milling
capacity of 70 tonnes per day in Jalalabad (Punjab).
For 2014-15 (refers to financial year, April 1 to March 31), on
provisional basis, the firm reported book profit of around INR1
million on net sales of INR193 million against book profit of INR1
million on net sales of INR169 million in the previous year.
M. R COTTON: CRISIL Reaffirms 'B' Rating on INR72.5MM Cash Loan
---------------------------------------------------------------
The rating reflects M. R Cotton Industries (MR Cotton) modest
scale of operations in highly fragmented cotton industry due to
nascent stage of operations and vulnerability of business and
profitability to changes in government policy. The rating also
factors in MR Cotton's below average financial risk profile marked
by modest networth, high gearing and weak debt protection
measures.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Cash Credit 72.5 CRISIL B/Stable (Reaffirmed)
Term Loan 27.5 CRISIL B/Stable (Reaffirmed)
These rating weaknesses are partially offset by the extensive
experience of MR Cotton's partners in cotton industry.
Outlook: Stable
CRISIL expects MR Cotton will benefit over the medium term, backed
by its partner's extensive experience in the cotton industry. The
outlook may be revised to 'Positive' in case of higher-than
expected ramp up in scale of operations, while improving its
profitability margins, resulting in better cash accruals.
Conversely, the outlook may be revised to 'Negative', if MR
Cotton's financial risk profile deteriorates in case of the
lengthening of its working capital cycle or generates lower-than-
expected cash accruals from operations, resulting in weakening of
its liquidity and its debt servicing ability.
Update
For the year 2014-15 (refers to financial year from April 1 to
March 31), MR Cotton's turnover is estimated to be around INR304
million against INR135 million during previous year, supported by
full year of operations. Over the medium term CRISIL expects the
firm to maintain the turnover growth in the range of 10 to 15 per
cent, although the turnover growth continues to be susceptible to
the economic scenario and government policies. During 2014-15 due
to demand supply correction the cotton prices have dipped leading
to some pressure on the operating level margin for the firm. Over
the medium term CRISIL believes that the fragmented nature of
industry will restrict the firm's bargaining power thus leading to
similar low operating margins range bound at 3.0 to 4.0 per cent.
CRISIL expects MR Cotton's GCA days in the range of 65 to 70 days;
however the overall working capital requirements are expected to
rise with its scale of operations over the medium term. As of
March 31, 2015 the gearing of the firm improved year on year to
around 1.36 times on account of moderate working capital debt
level coupled with capital infusion of INR15 million to support
its networth. Over the medium term, the gearing is expected to
remain in range of 1.1 to 1.3 times on account of incremental debt
to service its working capital requirements vs. modest accruals.
The debt protection metrics continue to be below average with net
cash accruals at 0.04 times and interest coverage ratio at 1.5
times during 2014-15 marked by low profitability. Over the medium
term, the financial risk profile is expected to be constrained by
its below avg. debt protection metrics and stretched liquidity.
MR Cotton was established as a partnership firm in 2011 by Mr.
Dhirenbhai Patel, along with family members Mr. Mahendrabhai
Patel, Mr. Chetankumar Patel, Mr. Rumitkumar Patel and Smt. Veena
Vinodbhai Patel. The firm is engaged in ginning and pressing of
raw cotton (kapas) to make cotton bales and also undertakes sell
of cotton seed and cotton seed cake. The firm has manufacturing
facility at Kadi, Mehsana (Gujarat).
MR Cotton reported a net profit of INR1.5 million on operating
income of INR304 million for 2014-15 (on a provisional basis),
against a net loss of INR1.2 million on net sales of INR135
million for 2013-14.
MAYUR COLDSTORAGE: CRISIL Reaffirms 'D' Rating on INR65MM Loan
--------------------------------------------------------------
CRISIL's rating on the long-term bank facilities of
Mayur Coldstorage Pvt Ltd (MCPL) continues to reflect delay in
debt servicing by MCPL; the delays are due to the company's weak
liquidity, driven by its working-capital-intensive operations.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Cash Credit 10 CRISIL D (Reaffirmed)
Proposed Long Term 65 CRISIL D (Reaffirmed)
Bank Loan Facility
Term Loan 25 CRISIL D (Reaffirmed)
MCPL also has below-average financial risk profile, marked by
modest net worth, high gearing, subdued debt protection metrics,
and modest scale of operations. These weaknesses are partially
offset by the extensive experience of MCPL's promoters in the cold
storage industry.
MCPL was incorporated in 2000, by the Shaikh family, along with
business acquaintances Mr. Esmail Ebrahim Kharodia and Mr.
Mohammad Muld Haroon Khan. MCPL provides cold storage facilities
to various wholesalers and distributors located in and around APMC
market inVashi (Navi Mumbai). Mr. Esmail Ebrahim Kharodia oversees
MCPL's operations.
MODERN DISTROPOLIS: CRISIL Reaffirms B Rating on INR150MM Loan
--------------------------------------------------------------
CRISIL's rating on the long-term bank facilities of Modern
Distropolis Limited (MDL) continues to reflect the company's
below-average financial risk profile marked by subdued debt
protection metrics, and its large working capital requirements.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Cash Credit 150 CRISIL B/Stable (Reaffirmed)
Proposed Long Term
Bank Loan Facility 5 CRISIL B/Stable (Reaffirmed)
Term Loan 25 CRISIL B/Stable (Reaffirmed)
These rating weaknesses are partially offset by the extensive
experience of MDL's promoters in the steel products segment.
Outlook: Stable
CRISIL believes that MDL will continue to benefit over the medium
term from its promoters' extensive industry experience and its
established relationships with suppliers and customers. The
outlook may be revised to 'Positive' if MDL reports large cash
accruals leading to improvement in its financial risk profile.
Conversely the outlook may be revised to 'Negative' in case of
lengthening of the company's working capital cycle or large debt-
funded capital expenditure, weakening its financial risk profile.
Set up in 1993 as a partnership firm which was reconstituted as a
closely held public limited company in 2013, MDL is the authorised
dealer for Tata Steel Ltd and Tata Bluescope Steel Ltd for various
building materials, including galvanised iron wires, galvanised
corrugated sheets, and colour coated sheets. The company's daily
operations are managed by Mr. K V Anvar.
MOENUS TEXTILE: Ind-Ra Affirms 'IND BB-' Long-Term Issuer Rating
----------------------------------------------------------------
India Ratings and Research has affirmed Moenus Textile Private
Limited's Long-Term Issuer Rating at 'IND BB-' with a Stable
Outlook. The agency has also taken these rating actions on MTPL's
bank facilities:
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Term loans 41.44 Affirmed at 'IND BB-'/Stable
(reduced from 81.46)
Fund-based 106.00 Affirmed at 'IND BB-'/Stable
working capital (reduced from 126)
limits
Non-fund-based 21.00 Affirmed at 'IND A4+'
working capital (reduced from 28)
limit
KEY RATING DRIVERS
The affirmation reflects MTPL's continued small scale of
operations and modest credit profile. According to the
provisional financials for FY15 (year end March), revenue was
INR394.46 mil. (FY14: INR443.99 mil.), interest coverage was 3.19x
(2.62x) and net financial leverage was 2.42x (2.59x). The ratings
also factor in MTPL's moderate liquidity position as indicated by
its average maximum working capital utilization of 81.04% during
the 12 months ended May 2015.
The ratings continue to be supported by 20 years of experience of
one of the company's promoters in the textile industry.
RATING SENSITIVITIES
Positive: A sustained improvement in the overall credit metrics
will be positive for the ratings.
Negative: A sustained deterioration in the overall credit metrics
will be negative for the ratings.
Incorporated in 2005, MTPL manufactures cotton yarn using rotor
spinning technology in Mandideep, Madhya Pradesh. The company
also has a waste recycling plant to produce low-value cotton yarn.
MTPL is a private limited company managed by S. Rupamka and N.M.
Shukla.
MOTOR SALES: CRISIL Reaffirms 'B' Rating on INR95MM Cash Loan
-------------------------------------------------------------
CRISIL's rating on the long-term bank facilities of Motor Sales
Ltd (MSL) continues to reflect MSL's weak financial risk profile,
marked by a high total outside liabilities to tangible net worth
(TOLTNW) ratio, modest debt protection metrics, and a small net
worth. The rating also factors in the company's small scale of
operations. These rating weaknesses are partially offset by the
extensive experience of MSL's promoter in the automotive
dealership business and the company's stable rental revenue from
its commercial properties.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Cash Credit 95 CRISIL B/Stable (Reaffirmed)
Channel Financing 91 CRISIL B/Stable (Reaffirmed)
Proposed Long Term
Bank Loan Facility 35 CRISIL B/Stable (Reaffirmed)
Term Loan 3.1 CRISIL B/Stable (Reaffirmed)
Outlook: Stable
CRISIL believes that MSL will continue to benefit over the medium
term from its promoter's extensive industry experience. The
outlook may be revised to 'Positive' in case of substantial
increase in the company's revenue and sustained improvement in its
profitability margins and working capital management resulting in
substantial cash accruals and a better financial risk profile.
Conversely, the outlook may be revised to 'Negative' if MSL's
revenue or profitability margins decline, or if its capital
structure deteriorates on account of large working capital
requirements.
Incorporated in 1972 and promoted by Mr. Ajay Gupta, MSL deals in
vehicles of Tata Motors Ltd (TML). MSL has three showrooms, two in
Lucknow and one in Rae Bareli (both in Uttar Pradesh). The company
also operates a cinema hall and a commercial complex in Lucknow.
MUMBAI WASTE: Ind-Ra Withdraws 'IND BB-(Suspended)' Rating
----------------------------------------------------------
India Ratings & Research has withdrawn Mumbai Waste Management
Limited's Long-Term Issuer Rating of 'IND BB-(suspended)'.
The ratings have been withdrawn due to lack of adequate
information. Ind-Ra will no longer provide ratings or analytical
coverage for REEL.
Ind-Ra suspended MWML's ratings on Nov. 24, 2014.
MWML's ratings:
-- Long-term Issuer Rating: 'IND BB-(suspended)'; rating
Withdrawn
-- INR95 mil. fund-based working capital limits: 'IND BB-
(suspended)'/'IND A4+(suspended)'; rating withdrawn
-- INR25 mil. non-fund based limits: 'IND BB-(suspended)'/'IND
A4+(suspended)' ; rating withdrawn
-- INR275.7 mil. term loans: 'IND BB-(suspended)'; rating
withdrawn
NORTHERN INDIA: CRISIL Cuts Rating on INR150MM Cash Loan to 'B'
---------------------------------------------------------------
CRISIL has downgraded its rating on the long-term bank facilities
of Northern India Leather Cloth Manufacturing Company Pvt Ltd
(NILCO) to 'CRISIL B/Stable' from 'CRISIL B+/Stable'; the short-
term rating has been reaffirmed at 'CRISIL A4'.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Cash Credit 150 CRISIL B/Stable (Downgraded
from 'CRISIL B+/Stable')
Letter of Credit 40 CRISIL A4 (Reaffirmed)
Overdraft Facility 10 CRISIL B/Stable (Downgraded
from 'CRISIL B+/Stable')
Proposed Long Term 0.2 CRISIL B/Stable (Downgraded
Bank Loan Facility from 'CRISIL B+/Stable')
Term Loan 216.6 CRISIL B/Stable (Downgraded
from 'CRISIL B+/Stable')
The rating downgrade reflects CRISIL's belief that NILCO's
financial risk profile will remain under pressure over the medium
term on account of weak liquidity, with cash accruals that are
insufficient to service maturing debt. The liquidity is
constrained by stretch in debtor cycle, weak bargaining power with
large customers, and intensifying competition especially from
Chinese imports. Stagnant revenue, and weak profitability owing to
increased overheads and high interest and financial charges, are
expected to constrain net cash accruals. Any shortfall in cash
accruals is expected to be met by infusion of equity of INR40
million in 2015-16 (refers to financial year, April 1 to
March 31).
Outlook: Stable
CRISIL believes that NILCO will continue to benefit over the
medium term from its established customer base, especially in
North India. The outlook may be revised to 'Positive' if
improvement in liquidity strengthens the financial risk profile.
Conversely, the outlook may be revised to 'Negative' if the
financial risk profile weakens on account of pressure on
liquidity.
Incorporated in 1980, NILCO manufactures polyvinyl chloride-coated
fabric, also known as synthetic leather, used in footwear,
furnishing, and sports goods, at its plant in Faridabad (Haryana).
OVERSEAS CARPETS: CRISIL Assigns 'B-' Rating to INR180MM Loan
-------------------------------------------------------------
CRISIL has revoked the suspension of its rating on the long term
bank facilities of Overseas Carpets Ltd (OCL) and has assigned its
'CRISIL B-/Stable' rating to these bank facilities. CRISIL had
earlier, through its rating rationale dated December 08, 2014,
suspended the rating as OCL did not provide the information
required to undertake a rating review. The company has now shared
the requisite information, enabling CRISIL to assign rating to the
company's bank facilities.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Bill Discounting 180 CRISIL B-/Stable (Assigned;
Suspension Revoked)
Cash Credit 70 CRISIL B-/Stable (Assigned;
Suspension Revoked)
Export Packing 100 CRISIL B-/Stable (Assigned;
Credit Suspension Revoked)
The rating reflects OCL's working-capital-intensive, and small
scale of, operations in the highly fragmented and competitive
carpet export industry. The rating also factors in the company's
stretched liquidity due to high receivables. These rating
weaknesses are partially offset by the extensive experience of
OCL's promoter and eestablished relationship with suppliers and
customers.
Outlook: Stable
CRISIL believes that OCL will continue to benefit from its
promoter's extensive experience in the industry and established
relationship with suppliers and customers, over the medium term.
The outlook may be revised to 'Positive' if the company scales up
its operations along with improvement in its working capital
management. Conversely, the outlook may be revised to 'Negative'
in case of deterioration in its liquidity due to significant
increase in working capital requirements, debt-funded capital
expenditure, or decline in margins resulting in lower-than-
expected cash accruals.
Incorporated in 1981, OCL exports carpets. It is promoted by Mr. O
P Garg. OCL is the flagship company of the Garg group, which has
interest in carpets and handicrafts exports, travel services, and
manufacturing of compact discs.
PRATHYUSHA EDUCATIONAL: 'IND D' Rating on INR133MM Loan Suspended
-----------------------------------------------------------------
India Ratings and Research migrated the Long-term 'IND D' rating
on Prathyusha Educational Trust's INR133.32 mil. bank loans and
INR20 mil. working capital facility to 'IND D(suspended)'.
The rating has been suspended due to lack of adequate information.
Ind-Ra will no longer provide ratings or analytical coverage for
PET's loans.
The rating will remain in the suspended category for a period of
six months and be withdrawn at the end of that period. However,
in the event the issuer starts furnishing information during this
six-month period, the rating could be reinstated and will be
communicated through a rating action commentary.
PRITHVI POLYMERS: Ind-Ra Assigns 'IND B' Long-Term Issuer Rating
----------------------------------------------------------------
India Ratings and Research has assigned Prithvi Polymers
Industries Pvt Ltd a Long-Term Issuer Rating of 'IND B'. The
Outlook is Stable. Ind-Ra has also assigned these ratings to
PPIPL's bank loans:
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Term loan 60 'IND B'; Outlook Stable
Fund-based limit 14.58 'IND B'; Outlook Stable
KEY RATING DRIVERS
The ratings reflect PPIPL's small scale of operations with revenue
of INR11 mil. according to the provisional financials for FY15
(year end March). The ratings further reflect the company's weak
credit metrics with interest coverage of 2.1x and net leverage of
18.1x. PPIPL has started commercial operations as recently as
January 2015 and is exposed to price fluctuations due to the
absence of raw material tie-ups.
The ratings, however, benefit from PPIPL's moderate working
capital utilization of around 50% on average during the five
months ended April 2015.
RATING SENSITIVITIES
Positive: A substantial increase in the revenue leading to a
substantial improvement in the credit metrics will be positive for
the ratings.
Negative: Any deterioration in the overall credit profile will be
negative for the ratings.
Incorporated in 2014, PPIPL manufactures thermoform disposables.
It is managed by Pradeep Goenka and has its registered office in
Mumbai.
R.G. PIGMENTS: CRISIL Reaffirms B+ Rating on INR30MM Bank Loan
--------------------------------------------------------------
CRISIL's ratings on the bank facilities of R.G. Pigments Pvt Ltd
(RGP) continue to reflect RGP's weak financial risk profile,
marked by weak debt protection metrics, moderate working capital
requirement, and modest scale of operations in the highly
fragmented metal (lead) industry. These rating weaknesses are
partially offset by the extensive experience of the company's
promoters in the metal industry and its moderate risk management
policies.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Cash Credit 20 CRISIL B+/Stable (Reaffirmed)
Letter of Credit 70 CRISIL A4 (Reaffirmed)
Proposed Long Term
Bank Loan Facility 30 CRISIL B+/Stable (Reaffirmed)
Outlook: Stable
CRISIL believes that RGP will continue to benefit over the medium
term from its promoters' extensive experience in the lead and zinc
industry and its moderate risk management policies. The outlook
may be revised to 'Positive' if the company enhances its financial
risk profile with sizeable cash accruals or improves its working
capital management. Conversely, the outlook may be revised to
'Negative' if RGP's financial risk profile, particularly its
liquidity, deteriorates due to low cash accruals or substantial
working capital requirements or debt-funded capital expenditure.
Update
RGP's business risk profile is expected to be supported by its
strong relationship with its suppliers and customers, as reflected
in strong topline growth at a compound annual growth rate of
around 29 per cent over the past 5 year through 2014-15.However,
RGP's operating profitability remained at about 3.5 per cent as
majority of sales are through trading. Increase in scale of
operations and modest profitability have led to modest cash
accruals, estimated at INR1.6 million to INR2.00 million for 2014-
15 (refers to financial year, April 1 to March 31), against which
it has no debt obligation. Furthermore, the company sustained its
moderate working capital requirements with estimated gross current
assets of 144 days as on March 31, 2015, driven by moderate
inventory of about 65 days for the same period. RGP's weak
financial risk profile is reflected in its estimated gearing of
2.7 times due to incremental working capital requirement and its
modest net worth of INR48 million, for the period ended on March
31, 2015. RGP's liquidity is further supported by unsecured loans
from promoters of about INR12 million estimated as on March 31,
2015.
RGP reported an estimated profit after tax (PAT) of INR1.00
million on net sales of INR455 million for 2014-15; the company
reported a PAT of INR0.90 million on net sales of INR439.00
million for 2013-14.
RGP was incorporated in Kota (Rajasthan) in 1991. The company
manufactures lead oxide and trades in pure lead, refined lead,
lead ingots, lead alloys, and lead oxide. RGP has a manufacturing
facility in Kota with a total capacity of around 6000 tonnes per
annum.
RADICAL BIO-ORGANICS: CRISIL Suspends 'D' Rating on INR480MM Loan
-----------------------------------------------------------------
CRISIL has suspended its ratings on the bank facilities of
Radical Bio-Organics Ltd (RBOL).
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Cash Credit 120 CRISIL D
Long Term Loan 480 CRISIL D
The suspension of ratings is on account of non-cooperation by RBOL
with CRISIL's efforts to undertake a review of the ratings
outstanding. Despite repeated requests by CRISIL, RBOL is yet to
provide adequate information to enable CRISIL to assess RBOL's
ability to service its debt. The suspension reflects CRISIL's
inability to maintain a valid rating in the absence of adequate
information. CRISIL considers information availability risk as a
key credit factor in its rating process and non-sharing of
information as a first signal of possible credit distress, as
outlined in its criteria 'Information Availability Risk in Credit
Ratings'
RBOL was incorporated in 2010. The company operates a cereal-based
distillery unit and a 6.2 megawatt coal-based captive power plant
at Jakkepally in Ranga Reddy (Andhra Pradesh). The principal
products manufactured at the plant are ENA and technical alcohol.
RAJ INTERNATIONAL: CRISIL Suspends 'D' Rating on INR520MM Loan
--------------------------------------------------------------
CRISIL has suspended its ratings on the bank facilities of Raj
International Ltd.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Cash Credit 180 CRISIL D
Foreign Bill Discounting 520 CRISIL D
Term Loan 49.9 CRISIL D
The suspension of ratings is on account of non-cooperation by Raj
International with CRISIL's efforts to undertake a review of the
ratings outstanding. Despite repeated requests by CRISIL, Raj
International is yet to provide adequate information to enable
CRISIL to assess Raj International's ability to service its debt.
The suspension reflects CRISIL's inability to maintain a valid
rating in the absence of adequate information. CRISIL considers
information availability risk as a key credit factor in its rating
process and non-sharing of information as a first signal of
possible credit distress, as outlined in its criteria 'Information
Availability Risk in Credit Ratings'.
Raj International was established as a partnership firm named Raj
Synthetics in 1992. The firm was reconstituted as a private
limited company in 1996. Raj International has various business
divisions including textile trading, diamond trading, gold
jewellery manufacturing, and wind power generation. In 2007, the
company was reconstituted as a closely held public limited company
and was subsequently renamed.
RAMKY ENVIRO: Ind-Ra Withdraws 'IND BB-(Suspended)' Issuer Rating
-----------------------------------------------------------------
India Ratings and Research has withdrawn Ramky Enviro Engineers
Limited Long-Term Issuer Rating of 'IND BB-(suspended)'.
The ratings have been withdrawn due to lack of adequate
information. Ind-Ra will no longer provide ratings or analytical
coverage for REEL.
Ind-Ra suspended REEL's ratings on Nov. 28, 2014.
REEL's ratings are:
-- Long-term Issuer Rating: 'IND BB-(suspended)'; rating
withdrawn
-- INR2.74 bil. term loans: 'IND BB-(suspended)'; rating
withdrawn
-- INR1.49 bil. fund-based working capital limits: 'IND
BB-(suspended)'/'IND A4+(suspended)'; ratings withdrawn
-- INR4.0 bil. non-fund-based working capital limits: 'IND BB
-(suspended)'/'IND A4+(suspended)'; ratings withdrawn
RATAN ALUMINUM: CRISIL Reaffirms 'B+' Rating on INR100MM Loan
-------------------------------------------------------------
CRISIL's rating on the long-term bank facilities of Ratan Aluminum
Recycling Pvt Ltd (RAPL) continues to reflect RAPL's modest scale
of operations in a fragmented aluminium ingots industry along with
high customer concentration in the revenue profile.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Cash Credit 100 CRISIL B+/Stable (Reaffirmed)
The rating also factors in its weak financial risk profile, marked
by high gearing and below-average debt protection metrics. These
weaknesses are partially offset by ramp up of RAPL's operations
despite its limited track record.
Outlook: Stable
CRISIL believes that RAPL's business risk profile will remain
constrained by its limited track record of operations, and high
customer concentration in revenue profile. The outlook may be
revised to 'Positive' if RAPL's financial risk profile improves
with sustained improvement in its scale of operations and
operating profitability, or with promoters' fund infusions.
Conversely, the outlook may be revised to 'Negative' if RAPL's
financial risk profile weakens with significantly low
profitability or sizeable working capital requirements.
RAPL was incorporated in 2011 and has a manufacturing facility in
Faridabad (Haryana). The company manufactures aluminium ingots,
mainly for supplies in the automotive sector, and is promoted by
Mr. O P Paliwal, Ms. Rajni Paliwal, Mr. Vijay Paliwal and Mr.
Puneet Paliwal.
RIBA TEXTILES: Ind-Ra Affirms 'IND BB+' Long-Term Issuer Rating
---------------------------------------------------------------
India Ratings and Research has affirmed Riba Textiles Limited's
Long-Term Issuer Rating at 'IND BB+'. The Outlook is Stable. The
rating actions on RTL's bank loan facilities are:
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Fund-based limits 260 Affirmed at
(increased from 230) 'IND BB+'/Stable/'IND A4+'
Non-fund-based 32 Affirmed at
limits (increased from 30) 'IND BB+'/Stable/'IND A4+'
Long-term loans 58 Affirmed at
(increased from 37.97) 'IND BB+'/Stable
Proposed fund 27.97 Assigned 'Provisional
based limits IND BB+'/Stable/
'Provisional IND A4+'
KEY RATING DRIVERS
The affirmation reflects RTL's moderate credit profile and
declining EBITDA margins due to higher raw material prices and
competition. According to the provisional financials for FY15
(year end March), financial leverage was 3.22x (FY14: 5.19x),
gross interest coverage was 2.03x (2.84x) and margins were 5.02%
(5.22%).
The ratings, however, benefit from RTL's diversification of sales
in terms of customers and geography as it sells to global markets
and thus mitigates the seasonal cyclicality for its products. The
ratings also factor in RTL's moderate scale of operations with
revenue growing 27.68% yoy to INR1,189.42m in FY15 provisional
(FY14: 23.23% yoy). Liquidity position is comfortable as
reflected by 58.5%. Average working capital utilization for the
12 months ended May 2015.
RATING SENSITIVITIES
Positive: A significant improvement in the revenue and operating
profitability resulting in a sustained improvement in the net
financial leverage will lead to a positive rating action.
Negative: A sustained decline in the operating profitability
and/or an increase in working capital requirements leading to
deterioration in the net financial leverage will lead to a
negative rating action.
Riba is a niche player manufacturing terry towels and bath robes
for export with a focus on design. The company manufactures terry
towels such as beach and bath towels for brands such as TK Maxx,
Metro Sears, BigW and Loblaws. The company also supplies bath
robes and bath mats which are manufactured on job-work basis.
ROYAL PALMS: CRISIL Suspends 'D' Rating on INR871.1MM Term Loan
---------------------------------------------------------------
CRISIL has suspended its ratings on the bank facilities of
Royal Palms India Pvt Ltd (RPIPL).
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Term Loan 871.1 CRISIL D Suspended
The suspension of ratings is on account of non-cooperation by ALO
with CRISIL's efforts to undertake a review of the ratings
outstanding. Despite repeated requests by CRISIL, ALO is yet to
provide adequate information to enable CRISIL to assess ALO's
ability to service its debt. The suspension reflects CRISIL's
inability to maintain a valid rating in the absence of adequate
information. CRISIL considers information availability risk as a
key credit factor in its rating process and non-sharing of
information as a first signal of possible credit distress, as
outlined in its criteria 'Information Availability Risk in Credit
Ratings'
RPIPL was incorporated in 1984. The company is managed by its
chairman and managing director, Mr. Amir A Nensey, along with his
sons, Mr. Muhamad Nensey and Mr. Dilawar Nensey. RPIPL operates in
the hospitality, real estate and construction sectors. The company
commenced its operations by acquiring 240 acres of land near Aarey
Milk Colony in Goregaon (East), Mumbai.
SADVI POWER: CRISIL Suspends 'D' Rating on INR50MM Cash Loan
------------------------------------------------------------
CRISIL has suspended its ratings on the bank facilities of
Sadvi Power and Infratech Pvt Ltd (SDPITL).
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Cash Credit 50 CRISIL D
Proposed Long Term
Bank Loan Facility 20 CRISIL D
The suspension of ratings is on account of non-cooperation by
SDPITL with CRISIL's efforts to undertake a review of the ratings
outstanding. Despite repeated requests by CRISIL, SDPITL is yet to
provide adequate information to enable CRISIL to assess SDPITL's
ability to service its debt. The suspension reflects CRISIL's
inability to maintain a valid rating in the absence of adequate
information. CRISIL considers information availability risk as a
key credit factor in its rating process and non-sharing of
information as a first signal of possible credit distress, as
outlined in its criteria 'Information Availability Risk in Credit
Ratings'
Set up in 2008 as a private limited company, Sri Rudra Avenues Pvt
Ltd, its name was changed to SDITPL in October 2009. The company
undertakes construction of residential complexes, power projects
and other civil works. It is based in Andhra Pradesh. Mr. Vinod
Reddy is the managing director of the company.
SAGAR EDUCATIONAL: CRISIL Suspends 'D' Rating on INR160MM Loan
--------------------------------------------------------------
CRISIL has suspended its ratings on the bank facilities of
Sagar Educational Trust (SET).
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Proposed Long Term 20 CRISIL D
Bank Loan Facility
Term Loan 160 CRISIL D
The suspension of ratings is on account of non-cooperation by SET
with CRISIL's efforts to undertake a review of the ratings
outstanding. Despite repeated requests by CRISIL, SET is yet to
provide adequate information to enable CRISIL to assess SET's
ability to service its debt. The suspension reflects CRISIL's
inability to maintain a valid rating in the absence of adequate
information. CRISIL considers information availability risk as a
key credit factor in its rating process and non-sharing of
information as a first signal of possible credit distress, as
outlined in its criteria 'Information Availability Risk in Credit
Ratings'
SET was set up in 2010. The trust owns an international school at
Panchkula near Chandigarh. Mr. Vinod Gupta is the key promoter
trustee who looks after the operations of the trust.
SANJAY STRIPS: CRISIL Suspends B+ Rating on INR150MM Cash Loan
--------------------------------------------------------------
CRISIL has suspended its ratings on the bank facilities of Sanjay
Strips Pvt Ltd (SSPL).
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Cash Credit 150 CRISIL B+/Stable
The suspension of ratings is on account of non-cooperation by SSPL
with CRISIL's efforts to undertake a review of the ratings
outstanding. Despite repeated requests by CRISIL, SSPL is yet to
provide adequate information to enable CRISIL to assess SSPL's
ability to service its debt. The suspension reflects CRISIL's
inability to maintain a valid rating in the absence of adequate
information. CRISIL considers information availability risk as a
key credit factor in its rating process and non-sharing of
information as a first signal of possible credit distress, as
outlined in its criteria 'Information Availability Risk in Credit
Ratings'
SSPL was established as a proprietary concern named Sanjay Steels
by Mr. Sanjay Gupta in July 2007; it was reconstituted as a
private limited company in April 2011. The company trades in cold-
rolled sheets and steel long products.
SHAH MAHENDRA: CRISIL Suspends 'D' Rating on INR140MM Bill Disc.
----------------------------------------------------------------
CRISIL has suspended its rating on the bank facilities of
Shah Mahendra Kumar and Company (Export) Private Limited (SMKC).
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Bill Discounting 140 CRISIL D
Proposed Short Term
Bank Loan Facility 50 CRISIL D
The suspension of rating is on account of non-cooperation by SMKC
with CRISIL's efforts to undertake a review of the rating
outstanding. Despite repeated requests by CRISIL, SMKC is yet to
provide adequate information to enable CRISIL to assess SMKC's
ability to service its debt. The suspension reflects CRISIL's
inability to maintain a valid rating in the absence of adequate
information. CRISIL considers information availability risk as a
key credit factor in its rating process and non-sharing of
information as a first signal of possible credit distress, as
outlined in its criteria 'Information Availability Risk in Credit
Ratings'
SMKC was originally set up as a proprietorship concern in 1967 by
Mr. Harilal Shah; the firm was reconstituted as a private limited
company in 1990. SMKC is a government-recognised trading house.
The company trades in and exports onions, garlic, spices, and
other agro commodities. It has warehouses in Vashi, Pune, and
Nashik (all in Maharashtra).
SHINE STAR: Ind-Ra Affirms 'IND BB-' Long-Term Issuer Rating
------------------------------------------------------------
India Ratings and Research (Ind-Ra) has affirmed Shine Star's
Long-Term Issuer Rating at 'IND BB-'. The Outlook is Stable. Ind-
Ra has also affirmed the company's bank loans as follows:
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Fund-based working 100 'IND BB-'; Outlook Stable
capital limits
Non-fund-based 8.50 'IND A4+'
working capital limits
KEY RATING DRIVERS
The affirmation reflects Shine Star's continued moderate financial
profile with net financial leverage of 2.6x, interest coverage of
1.3x and EBITDA of INR15m based on provisional FY15 financials.
The firm is exposed to price volatility in diamond (its end
product) as well as foreign exchange as its revenue is derived
mainly from exports to countries such as the US, Belgium, Dubai,
etc.
The ratings are, however, supported by over three-decade-long
experience of Shine Star's founders in importing, polishing and
exporting of rock diamonds. Also, the liquidity is moderate as
indicated by Shine Star's 37% to 78% working capital use for the
12 months ended April 2015.
RATING SENSITIVITIES
Positive: A substantial increase in the scale of operations
leading to a sustained improvement in the credit metrics will be
positive for the ratings.
Negative: Decline in the scale of operations will be negative for
the ratings.
Incorporated in 1975, Shine Star is a partnership firm with its
registered office in Mumbai. The firm is into the importing,
polishing and exporting of rock diamonds.
SHIVA UDYOG: CRISIL Suspends 'D' Rating on INR183.5MM Term Loan
---------------------------------------------------------------
CRISIL has suspended its ratings on the bank facilities of Shiva
Udyog Barrels Pvt Ltd (SUBPL).
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Cash Credit 100 CRISIL D
Letter of Credit 30 CRISIL D
Term Loan 5 CRISIL D
Working Capital
Term Loan 183.5 CRISIL D
The suspension of ratings is on account of non-cooperation by
SUBPL with CRISIL's efforts to undertake a review of the ratings
outstanding. Despite repeated requests by CRISIL, SUBPL is yet to
provide adequate information to enable CRISIL to assess SUBPL's
ability to service its debt. The suspension reflects CRISIL's
inability to maintain a valid rating in the absence of adequate
information. CRISIL considers information availability risk as a
key credit factor in its rating process and non-sharing of
information as a first signal of possible credit distress, as
outlined in its criteria 'Information Availability Risk in Credit
Ratings'
SUBPL was incorporated in 2008, to take over the partnership firm,
Shiva Udyog. Mr. Pankaj Agarwal, Mr. Sanjeev Kumar, and Mr. B Lal
(Shiva Udyog's partners) retained a proportionate shareholding in
SUBPL. The company manufactures barrels (steel drums).
SHREE BALAJI: Ind-Ra Assigns 'IND B+' Long-Term Issuer Rating
-------------------------------------------------------------
India Ratings and Research (Ind-Ra) has assigned Shree Balaji
Jewellers (SBJ) a Long-Term Issuer Rating of 'IND B+'. The Outlook
is Stable. The agency has also assigned SBJ's INR150 mil. fund-
based limits a Long-term 'IND B+' rating with Stable Outlook and a
Short-term 'IND A4' rating.
KEY RATING DRIVERS
The ratings reflect SBJ's small scale of operations coupled with
low EBITDA margins due to its presence in the highly commoditised
and high capital intensive gold jewellery business. In FY14 (year
end March), revenue was INR630.83m and margins were 7.94%. The
ratings also reflect the firm's moderate-to-weak credit profile
with net financial leverage (adjusted net debt/operating EBITDA)
of 3.33x in FY14 (FY13: 6.04x) and EBITDA gross interest coverage
(operating EBITDA/gross interest expense) of 2.96x (1.47x).
The ratings also factor in SBJ's tight liquidity position as
reflected by its full use of the working capital limits during the
12 months ended May 2015, along with partnership structure of the
entity.
However, the ratings are supported by over three-decade-long
experience of SBJ's founders in the gold jewellery business and
the company's established customer relationships.
RATING SENSITIVITIES
Negative: Further deterioration in the liquidity profile will be
negative for the ratings.
Positive: Any substantial improvement in the operating
profitability leading to an improvement in the overall credit
profile will be positive for the ratings.
SBJ was established on 14 September 2001 and manufactures and
trades gold, silver, and diamond jewellery. The firm operates from
Nangloi branch, New Delhi
SIDDHIVINAYAK POLYTEX: Ind-Ra Affirms 'IND BB-' Issuer Rating
-------------------------------------------------------------
India Ratings and Research has affirmed Siddhivinayak Polytex
Private Limited's Long-Term Issuer Rating at 'IND BB-'. The
Outlook is Stable. Ind-Ra has also taken these rating actions on
SVPPL's bank facilities:
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Fund-based facility 50 Affirmed at 'IND BB-'
/Stable/'IND A4+'
Long-term loans 50 Affirmed at 'IND BB-'/Stable
KEY RATING DRIVERS
The affirmation reflects SVPPL's moderate credit profile and small
scale of operations. In FY14 (year end March), net financial
leverage was 4.86x, EBITDA gross interest coverage was 1.25x and
revenue was INR340 mil. (FY13: INR68.80 mil., eight months of
operations). EBITDA margins were moderate at 5.56% in FY14 due to
the commoditized nature of the end-product and volatile raw
material prices. Also, SVPPL is present in a highly fragmented
and intensely competitive industry and has minimal bargaining
power as it has to supply goods almost on the terms set by its
customers.
The ratings, however, benefit from over-three-decade-long
experience of SVPPLs' promoter in the manufacturing industry. The
ratings are further supported by the company's strong relationship
with its clientele and comfortable liquidity position as evident
from its 60.86% utilization of the working capital limits during
the 12 months ended May 2015.
RATING SENSITIVITIES
Negative: A decline in the profitability leading to deterioration
in the credit metrics will be negative for the ratings.
Positive: A significant rise in the operating profitability
leading to improved credit metrics will be positive for the
ratings.
SVPPL was incorporated in 2010, and commenced operations in March
2013. It manufactures polypropylene woven bags and fabric at
Chandauli, Uttar Pradesh at capacity of 4,800 tons per year. The
company has a strong clientele base and locational advantage of
being close to its prominent customers such as Birla Corporation,
Chunar Cement and Shree Cement Limited.
SINGHAL INDUSTRIES: CRISIL Suspends 'B' Rating on INR180.3MM Loan
-----------------------------------------------------------------
CRISIL has suspended its ratings on the bank facilities of
Singhal Industries Private Limited (SIPL).
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Cash Credit 100 CRISIL B/Stable
Letter of Credit 10 CRISIL A4
Proposed Long Term
Bank Loan Facility 4.2 CRISIL B/Stable
Term Loan 180.3 CRISIL B/Stable
The suspension of ratings is on account of non-cooperation by SIPL
with CRISIL's efforts to undertake a review of the ratings
outstanding. Despite repeated requests by CRISIL, SIPL is yet to
provide adequate information to enable CRISIL to assess SIPL's
ability to service its debt. The suspension reflects CRISIL's
inability to maintain a valid rating in the absence of adequate
information. CRISIL considers information availability risk as a
key credit factor in its rating process and non-sharing of
information as a first signal of possible credit distress, as
outlined in its criteria 'Information Availability Risk in Credit
Ratings'
SIPL, incorporated in 2007 and based in Gujarat, manufactures leno
bags, various types of high density polyethylene and polypropylene
bags, wide-width fabric, and warning mats. These products are used
as packaging material in industries such as sugar, cement, and
fast-moving consumer goods; the warning mats are used as mandatory
protection layers on underground gas pipelines. The company is
promoted by Mr. Pradeep Agarwal and his sons, Mr. Tushar Agarwal
and Mr. Pulkit Agarwal.
SREE VEERA: CRISIL Reaffirms 'D' Rating on INR75.1MM Term Loan
--------------------------------------------------------------
CRISIL's rating on the long-term bank facilities of Sree Veera
Brahmendra Swamy Spinning Mills Pvt Ltd (SVBS) continues to
reflect instances of delay by it in servicing its debt; the delays
have been caused by the company's weak liquidity resulting from
its depressed cash accruals being inadequate to meet its term debt
obligations.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Cash Credit 65 CRISIL D (Reaffirmed)
Term Loan 75.1 CRISIL D (Reaffirmed)
SVBS has a below-average financial risk profile, marked by its
small net worth, high gearing, and weak debt protection metrics.
The company has a modest scale of operations, is exposed to
intense competition in the cotton yarn industry, and its
profitability margins are susceptible to volatility in cotton
prices. However, it benefits from the entrepreneurial experience
of its promoter and its location in the cotton belt of the
country.
Incorporated in 2006, SVBS manufactures cotton yarn. The company
was set up by Mr. Chundi Tirupataiah and was sold off to Mr. G
Sundararamaiah in 2013. SVBS's plant is based in Guntur district
of Andhra Pradesh.
SRI BALAJI: CRISIL Reaffirms B+ Rating on INR55MM Cash Loan
-----------------------------------------------------------
CRISIL's rating on the long-term bank facilities of M/s. Sri
Balaji Rice Industries (SBRI) continue to reflect the firm's
below-average financial risk profile marked by high gearing,
below-average debt protection metrics, and small net worth, and
susceptibility of its operating profitability to changes in
government regulations and paddy prices. These rating weaknesses
are partially offset by the extensive industry experience of
SBRI's promoters in the rice-milling industry.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Cash Credit 55 CRISIL B+/Stable (Reaffirmed)
Long Term Loan 40 CRISIL B+/Stable (Reaffirmed)
Proposed Long Term
Bank Loan Facility 10 CRISIL B+/Stable (Reaffirmed)
Outlook: Stable
CRISIL believes that SBRI will benefit over the medium term from
its promoters' extensive experience in the rice-milling industry.
The outlook may be revised to 'Positive' if there is substantial
and sustained improvement in the firm's revenue and profitability
margins, or if there is a substantial increase in its net worth
owing to sizeable equity infusion from its promoters. Conversely,
the outlook may be revised to 'Negative' in case of a steep
decline in SBRI's profitability margins, or significant
deterioration in its capital structure caused most likely by large
debt-funded capital expenditure or a stretch in its working
capital cycle.
Set up in 2007, SBRI, a partnership firm is engaged in milling and
processing of paddy into rice, rice bran, broken rice, and husk.
The firm's rice mill is located in Nalgonda(Telangana)and is
promoted by Mr. Ch. Venkateswarulu and Mr. Ch. Yadagiri.
SRINIVAS INFRASTRUCTURE: Ind-Ra Assigns 'IND BB+' Issuer Rating
---------------------------------------------------------------
India Ratings and Research has assigned Srinivas Infrastructure
Private Limited a Long-Term Issuer Rating of 'IND BB+'. The
Outlook is Stable. SIPL's bank facilities have also been assigned
these ratings:
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Fund-based limit 40 'IND BB+'; Outlook Stable
Non-fund-based limit 30 'IND A4+'
KEY RATING DRIVERS
The ratings reflect SIPL's small scale of operations and tight
liquidity. According to the unaudited financials for FY15 (year
end March), revenue was INR550 mil. (FY14: INR516 mil). The
company primarily depends on sub-contracts issued by its group
company Siddhardha Construction Private Limited ('IND BBB'/Stable)
for revenue. The company also almost fully utilized the working
capital facilities during the 12 months ended May 2015 due to a
stretched working capital cycle. Delays in collection led to net
cash conversion cycle deteriorating to 77 days in FY14 (FY13: 46
days).
The ratings also factor in SIPL's comfortable credit profile with
EBITDA margins of 10.4% in FY14 (FY13: 9.7%), net leverage (net
debt/EBITDA) of 0.15x (0.15x) and gross interest coverage of 2.7x
(2.9x) in FY14. Also, the ratings benefit from the over two-
decade-long experience of SIPL's promoter in the construction
sector.
RATING SENSITIVITIES
Positive: A significant increase in the revenue while maintaining
the operating profitability could lead to a positive rating
action.
Negative: Any stress on liquidity due to a decline in the
operating margins or the elongation of net working capital cycle
could lead to a negative rating action.
Incorporated in 1995, SIPL executes civil construction contracts
in Andhra Pradesh and Telangana.
TAMILNADU WASTE: Ind-Ra Withdraws 'IND BB-(SO)(Suspended)' Rating
-----------------------------------------------------------------
India Ratings and Research has withdrawn Tamilnadu Waste
Management Limited's bank loan ratings as:
-- INR67.5 mil. fund-based working capital limits: 'IND BB-
(SO)(suspended)'/'IND A4+(SO)(suspended)'; ratings
withdrawn
-- INR10 mil. non-fund based limits: 'IND A4+(SO)(suspended)';
rating withdrawn
-- INR190.8 mil. term loans: 'IND BB-(SO)(suspended)'; rating
withdrawn
The ratings have been withdrawn due to lack of adequate
information. Ind-Ra will no longer provide ratings or analytical
coverage for TNWML.
Ind-Ra suspended TNWML's ratings on Nov. 28, 2014.
TARA EDUCATIONAL: CRISIL Assigns B+ Rating to INR13.8MM Loan
------------------------------------------------------------
CRISIL has assigned its 'CRISIL B+/Stable/CRISIL A4' ratings to
the bank loan facilities of Tara Educational Trust (TET).
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Term Loan 13.8 CRISIL B+/Stable
Overdraft Facility 60 CRISIL A4
Proposed Long Term
Bank Loan Facility 6.2 CRISIL B+/Stable
The ratings reflect TET's small scale of operations, geographical
concentration in its revenue profile, and weak liquidity. These
rating weaknesses are partially offset by the extensive experience
of TET's trustees in the education sector and average financial
risk profile marked by moderate gearing.
Outlook: Stable
CRISIL believes that TET will continue to benefit over the medium
term from the extensive experience of its trustees. The outlook
may be revised to 'Positive' if the trust increases its scale of
operations substantially, most likely by increasing the number of
courses it offers or diversifying its geographical reach, while
maintaining its surplus levels and capital structure. Conversely,
the outlook may be revised to 'Negative' if TET undertakes a large
debt-funded capital expenditure programme, or is adversely
affected by any regulatory change, resulting in deterioration in
its financial risk profile.
TET was established in 1998 as the Pioneer Public School
Management Committee by Mr. Jaswant Singh. In 2010 this
institution was converted into TET; presently, it runs three
schools and one college.
TECHNOFAB ENGINEERS: CRISIL Suspends 'D' Rating on INR40MM Loan
---------------------------------------------------------------
CRISIL has suspended its rating on the bank facilities of
Technofab Engineers (TE).
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Cash Credit 40 CRISIL D
Proposed Long Term
Bank Loan Facility 25.3 CRISIL D
Term Loan 14.7 CRISIL D
The suspension of ratings is on account of non-cooperation by TE
with CRISIL's efforts to undertake a review of the ratings
outstanding. Despite repeated requests by CRISIL, TE is yet to
provide adequate information to enable CRISIL to assess TE's
ability to service its debt. The suspension reflects CRISIL's
inability to maintain a valid rating in the absence of adequate
information. CRISIL considers information availability risk as a
key credit factor in its rating process and non-sharing of
information as a first signal of possible credit distress, as
outlined in its criteria 'Information Availability Risk in Credit
Ratings'
Established in 1991 by Mr. Chetan Lavania, as his proprietorship
concern, Technofab Engineers is engaged in manufacturing,
fabrication of transmission, telecom towers and sub-station
structures, etc. The concern's office is located at Nagpur,
Maharashtra.
TRANS FAB: CRISIL Reaffirms B+ Rating on INR109.5MM Cash Loan
-------------------------------------------------------------
CRISIL's ratings on the bank facilities of Trans Fab Power India
Pvt Ltd (TPIPL) continue to reflect its below-average financial
risk profile, marked by small net worth, high gearing, and below-
average debt protection metrics.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Bank Guarantee 95 CRISIL A4 (Reaffirmed)
Cash Credit 109.5 CRISIL B+/Stable (Reaffirmed)
Letter of Credit 75 CRISIL A4 (Reaffirmed)
Proposed Long Term
Bank Loan Facility 20.5 CRISIL B+/Stable (Reaffirmed)
The ratings also factor in the company's modest scale of
operations in the fragmented transformer manufacturing industry,
and large working capital requirements. These rating weaknesses
are partially offset by the extensive industry experience and
funding support of the promoters, and TPIPL's moderate order book
and healthy customer relationships.
Outlook: Stable
CRISIL believes that TPIPL will continue to benefit over the
medium term from its promoters' extensive experience in the
electrical transformer industry and their funding support. The
outlook may be revised to 'Positive' if significant improvement in
scale of operations and profitability results in stronger cash
accruals for TPIPL; or if efficient working capital management and
continued funding support from the promoters strengthen its
financial risk profile. Conversely, the outlook may be revised to
'Negative' if low cash accruals, large working capital
requirements, or any sizeable capital expenditure weakens the
company's financial risk profile, particularly liquidity.
Incorporated in 2006, TPIPL manufactures distribution and power
transformers ranging from 25 kilovolt amperes to 25 megavolt
amperes. Its manufacturing facilities are in Pirangut, near Pune
(Maharashtra). TPIPL mainly caters to engineering, procurement,
and construction (EPC) players in the power sector and to other
industrial customers. The company is promoted by Mr. R B Shinde,
who has nearly two decades of experience in the electrical
transformers industry.
V M MATERE: CRISIL Suspends B+ Rating on INR100MM Cash Loan
-----------------------------------------------------------
CRISIL has suspended its ratings on the bank facilities of
V M Matere Infrastructures India Private Limited (VMMIIPL).
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Bank Guarantee 100 CRISIL A4
Cash Credit 100 CRISIL B+/Stable
Corporate Loan 60 CRISIL B+/Stable
Term Loan 20 CRISIL B+/Stable
The suspension of ratings is on account of non-cooperation by
VMMIIPL with CRISIL's efforts to undertake a review of the ratings
outstanding. Despite repeated requests by CRISIL, VMMIIPL is yet
to provide adequate information to enable CRISIL to assess
VMMIIPL's ability to service its debt. The suspension reflects
CRISIL's inability to maintain a valid rating in the absence of
adequate information. CRISIL considers information availability
risk as a key credit factor in its rating process and non-sharing
of information as a first signal of possible credit distress, as
outlined in its criteria 'Information Availability Risk in Credit
Ratings'
Incorporated in 2007, VMMIIPL undertakes road construction and
repairs, constructs buildings, and lays pipelines for water supply
and sewage disposal. Its promoters, the Matere family from Pune
(Maharashtra), have been in the civil construction business since
1991, through the proprietorship concern VM Matere. VMMIIPL
acquired the business of this firm in 2008-09.
V3 MEGACORP: CRISIL Reaffirms 'D' Rating on INR87MM Bank Loan
-------------------------------------------------------------
CRISIL's ratings on the bank facilities of V3 Megacorp
International Pvt Ltd (V3) continue to reflect V3's below-average
financial risk profile, marked by high gearing and working-
capital-intensive operations. The company is exposed to risks
related to a slowdown in capital investments in the Indian
economy. V3, however, benefits from its promoter's extensive
experience in the steel fabrication segment.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Bank Guarantee 87 CRISIL D (Reaffirmed)
Cash Credit 55 CRISIL D (Reaffirmed)
Letter of Credit 3 CRISIL D (Reaffirmed)
Long Term Loan 5.2 CRISIL D (Reaffirmed)
Proposed Long Term
Bank Loan Facility 30.4 CRISIL D (Reaffirmed)
Working Capital
Term Loan 180.0 CRISIL D (Reaffirmed)
Update
V3 continues to have instances of overdrawals in the working
capital limits for more than 30 days because of its weak
liquidity, marked by weakening of its revenue profile leading to
insufficient cash accruals. CRISIL believes that V3's liquidity
will remain weak over the medium term because of its modest scale
of operations.
V3, incorporated in 2006, is promoted by Mr. Vighnaprabodhan
Thanneermalai. The company fabricates structural components for
the power, cement, and sugar industries, and for industrial
plants.
VINAYAK RATHI: CRISIL Suspends B Rating on INR225MM Cash Loan
-------------------------------------------------------------
CRISIL has suspended its rating on the bank facilities of Vinayak
Rathi Steels Rolling Mills Private Limited (VRSRM).
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Cash Credit 225 CRISIL B/Stable
Term Loan 105 CRISIL B/Stable
The suspension of ratings is on account of non-cooperation by
VRSRM with CRISIL's efforts to undertake a review of the ratings
outstanding. Despite repeated requests by CRISIL, VRSRM is yet to
provide adequate information to enable CRISIL to assess VRSRM's
ability to service its debt. The suspension reflects CRISIL's
inability to maintain a valid rating in the absence of adequate
information. CRISIL considers information availability risk as a
key credit factor in its rating process and non-sharing of
information as a first signal of possible credit distress, as
outlined in its criteria 'Information Availability Risk in Credit
Ratings'
VRSRM was originally incorporated in 1979 as Good Luck Sales Pvt
Ltd; the name was changed in January 2008, as the promoters
planned to set up a steel rolling mill in New Delhi. The company
is promoted by Mr. Rajiv Rathi and his sons, Mr. Rishi Rathi and
Mr. Aditya Rathi. VRSRM, which commenced commercial production in
December 2011, manufactures steel-rolled products, mainly thermo-
mechanically-treated bars; it has a capacity of 120,000 tonnes per
annum (tpa; enhanced from 84,000 tpa).
VRS GRANITES: CRISIL Ups Rating on INR30MM LT Loan to 'B'
---------------------------------------------------------
CRISIL has upgraded its ratings on the bank facilities of
VRS Granites Pvt Ltd (VRSG) to 'CRISIL B/Stable/CRISIL A4' from
'CRISIL D/CRISIL/D'.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Bill Purchase 20 CRISIL A4 (Upgraded from
'CRISIL D')
Cash Credit 10 CRISIL B/Stable (Upgraded
from 'CRISIL D')
Long Term Loan 30 CRISIL B/Stable (Upgraded
from 'CRISIL D')
Packing Credit 40 CRISIL A4 (Upgraded from
'CRISIL D')
The rating upgrade reflects the improvement in VRSG's liquidity,
leading to timely servicing of its term loans over the past two
quarters. The company had generated cash accruals of INR13 million
in 2014-15 (refers to financial year, April 1 to
March 31), driven by ramp up in its scale of operations and its
healthy operating margin. The increasing cash accruals were
sufficient to timely repay its debt obligations over the past two
quarters. CRISIL believes that VRSG's increasing cash accruals
will be sufficient to meet its debt repayment obligations going
ahead as well. The rating upgrade also factors in CRISIL's belief
that the company will sustain its improved financial risk profile
over the medium term backed by steady accretion to reserves and
controlled reliance on external debt.
The ratings reflect VRSG's modest scale of operations and its
large working-capital requirements. These rating weakness are
partially offset by the extensive experience of VRSG's promoters
in the granite industry.
Outlook: Stable
CRISIL believes that VRSG will continue to benefit over the medium
term from its promoters' extensive industry experience. The
outlook may be revised to 'Positive' if there is a substantial
increase in the company's scale of operations while it sustains
its profitability, or if its capital structure improves, most
likely driven by equity infusion by promoters. Conversely, the
outlook may be revised to 'Negative' if VRSG's revenue or
profitability declines, or its working capital cycle lengthens,
leading to pressure on its liquidity.
Incorporated in June 2011, VRSG processes granite blocks into
polished slabs. The company's processing facility is in Medhak
(Andhra Pradesh). It has a capacity to manufacture 180,000 square
feet per month of cut and polished granite. The company is
currently promoted by Mr. Venugopal Karwa.
YETURU BIO-TECH: CRISIL Reaffirms 'D' Rating on INR40MM Cash Loan
-----------------------------------------------------------------
CRISIL's rating on the long-term bank facilities of Yeturu Bio-
Tech Ltd (YTBL) continues to reflect instances of delay by the
company in servicing its debt; the delays have been caused by the
company's weak liquidity resulting from its depressed cash
accruals being inadequate to meet its term debt obligations.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Cash Credit 40 CRISIL D (Reaffirmed)
Proposed Long Term
Bank Loan Facility 19.8 CRISIL D (Reaffirmed)
Secured Overdraft
Facility 5.0 CRISIL D (Reaffirmed)
Term Loan 27.2 CRISIL D (Reaffirmed)
YTBL has modest scale of operations, large working capital
requirements, and below-average financial risk profile, marked by
its small net worth and weak debt protection metrics. However, the
company benefits from its promoters' extensive industry
experience.
YTBL was established as a partnership firm in 1996 as Yeturu
Gardens by Mr. Yeturu Ramchandra Reddy; the firm was reconstituted
as a private limited company and got its current name in 2003 and
is based in Hyderabad (Telangana). The company cultivates aloe
vera plants and manufactures aloe vera-based personal care and
healthcare products.
===============
M A L A Y S I A
===============
MALAYSIA AIRLINES: Strike Will Only Backfire on MAS Employees
-------------------------------------------------------------
The Star Online reports that a union call for a "tools down"
protest by employees of Malaysia Airlines (MAS) will only backfire
on themselves as well as potentially result in the airline facing
a costly consumer backlash, an academician warned on June 15.
Dr. Ahmad Zaharuddin Sani Sabri of Universiti Utara Malaysia (UUM)
said that after the twin tragedies of MH370 and MH17 which eroded
passengers confidence and raised safety issues, this intransigence
seemed increasingly likely to damage Malaysia's image and the
airlines brand, the report relates.
And he said it was most unfair that people would have their travel
plans disrupted by the selfish actions of a tiny number of
employees, according to the Star Online.
According to the report, Dr. Ahmad Zaharuddin, who is deputy
director of UUM's Institute of Tun Dr Mahathir Mohammad Thoughts,
said the threat issued last week by the National Union of Flight
Attendants of Malaysia (NUFAM) to go on strike unless the airline
rescinded its move to retrench 6,000 employees, was
"irresponsible" given the reality that MAS was in a "technically
bankrupt" situation.
He said after undergoing three failed restructurings, all efforts
must be made to ensure the success of the ongoing revamp because
failure was not an option, the Star Online relays.
"MAS' survival is now paramount. If there is any employees' union
who's thinking of staging a strike, they should ask themselves who
is going to benefit from such a move? " Dr. Ahmad Zaharuddin told
Bernama, the report relays.
He told the union that going on strike would only undermine the
airline's recovery plans and put the jobs of the other 14,000
employees being retained at great risk, the Star Online reports.
The Star Online adds that Dr. Zaharuddin pointed out the
MYR6 billion being pumped by Khazanah Nasional Bhd (Khazanah)
which owns MAS to save the national carrier also meant providing a
lifeline to the remaining 14,000 jobs, adding that without the
injection of such massive funds, the airline would be declared
bankrupt already.
If MAS is forced to reinstate the 6,000 employees as demanded by
the union, then the airline would have to close shop, he added,
the report relays.
"Why must we allow the minority to prevail over the majority? Why
don't we think of national interest instead of individuals'
interest?" the report quotes Dr Zaharuddin as saying. "It doesn't
mean that we are not sympathetic to the plight of the 6,000
workers being laid off but if we want to save MAS, then they will
have to seek other employment."
* * *
As reported by the Troubled Company Reporter - Asia Pacific on
June 3, 2015, Bloomberg News said Malaysia's national airline is
terminating about 6,000 workers and reviewing plane purchases in a
bid to return to profit as Chief Executive Officer Christoph
Mueller declared the company "technically bankrupt."
According to Bloomberg News, Mr. Mueller said Malaysia Airlines
Bhd. is kicking off a corporate revamp with a "hard reset" as it
seeks to cut costs by 20 percent and break even by 2018 after two
air disasters last year. The carrier is retaining at least 14,000
employees for the new company and will refurbish the business-
class section on some planes as part of its turnaround, he said.
Bloomberg said Malaysia Airlines is seeking to reinvent itself
after stiff competition led to years of losses, even before flight
MH370 disappeared in March last year and MH17 was shot down over
Ukraine. Bloomberg related that Mr. Mueller said the carrier
needs time to turn around with a plan that includes adjusting the
size of operations and renegotiating key contracts.
The old structure, Malaysian Airline System Bhd., will cease
operations in August, and selected assets and liabilities will be
transferred to the new company, Bloomberg noted.
Headquartered in Selangor, Malaysia, state-owned Malaysia Airlines
-- http://www.malaysiaairlines.com/-- engages in the business of
air transportation and the provision of related services.
====================
N E W Z E A L A N D
====================
NZ DIRECTORIES: Creditors Approve Debt-For-Equity Deal
------------------------------------------------------
Jonathan Underhill at BusinessDesk reports that creditors of NZ
Directories Holdings, the owner of the Yellow directories service,
have voted overwhelmingly in favour of a new capital structure,
that will see them holding securities in a new company in return
for relinquishing claims to NZ$385 million of debt.
The new company Yellow Holdings Ltd will incorporate New Zealand
Directories IP Ltd, Yellow Pages Group Ltd and its subsidiary,
Finda Ltd, they said in a statement, BusinessDesk relates.
"The board, management and shareholders are very pleased to make
these changes as they effectively unshackle the business to be
more nimble, responsive and future focused," the report quotes
chairman Brett Chenoweth as saying. "We now have a simpler
corporate structure, with 12 shareholders and a conservative level
of commercial debt."
According to the report, the company's leverage will be about two
times earnings before interest, tax, depreciation and
amortisation.
Executives won't answer questions or be available for interviews
to discuss the changes to the directories business, according to
the statement, issued by PR firm Porter Novelli and distributed
selectively to media, BusinessDesk says.
Auckland-based NZ Directories has gross assets of NZ$182.5 million
and there was "no realistic prospect that the company can
refinance the existing debt facilities with a third-party
financier" when they come due on August 31, NBR Online reports
citing the company's notice for June 15's meeting.
The creditors will be issued with shares and notes in Yellow
Holdings, a company structured to meet new 'thin capitalisation
rules' coming into effect from July 1, BusinessDesk discloses. Mr.
Chenoweth said the new company incorporated on April 21 is still
held in the name of a single shareholder, the report adds.
The report says the new structure is the second such overhaul in
four years. Bankers to the company formerly known as Yellow Pages
Group wrote off NZ$1.05 billion of debt when they took control of
the business in 2011, the report recalls. They were issued 250
million shares held via Yellow Pages Equity Trust and NZ$500
million of senior notes, wiping out the equity of the original
owners, Hong Kong-based Unitas Capital and Canada's Ontario
Teachers' Pension Plan, who bought Yellow Pages from Telecom for
NZ$2.24 billion in 2007 in a leveraged buy-out, according to
BusinessDesk.
NZ Directories Holdings, formerly known as Yellow Pages Group was
formed in 1988 and publishes the print, online and mobile
directories for Yellow, as well as the White pages(R) and the
Local directoryTM. Yellow Pages owns the 018(R) directory
assistance service, a majority stake in 50s-plus website
grownups.co.nz, and publishes the Retirement guideTM and New
Zealand tourism guideTM, an award-winning online tourism
directory.
===============
P A K I S T A N
===============
PAKISTAN MOBILE: Moody's Upgrades CFR to B1, Outlook Now Stable
---------------------------------------------------------------
Moody's Investors Service upgraded the corporate family rating of
Pakistan Mobile Communications Limited (Mobilink) to B1 from B2.
At the same time, Moody's has revised the ratings outlook to
stable from positive.
The rating action reflects the upgrade to Pakistan's sovereign
rating to B3, and to Mobilink's stronger fundamental credit
quality when compared to the sovereign.
On 11 June, Moody's upgraded Pakistan's foreign currency
government bond rating, along with its issuer and senior unsecured
ratings by one notch to B3 from Caa1, and assigned a stable
outlook.
"Despite its stronger fundamental credit quality, Mobilink's B1
corporate family rating is constrained by the two notch
differential between its own rating and the sovereign's B3
rating," says Gloria Tsuen, a Moody's Vice President and Senior
Analyst.
"Mobilink's rating has been upgraded by one notch, in line with
the one notch upgrade to Pakistan's sovereign ratings," adds
Tsuen.
As Mobilink is predominantly a domestic entity, with substantially
all of its revenues derived from, and assets based in, Pakistan,
Moody's believes that the company's fundamental creditworthiness
needs to closely reflect the potential risks that it shares with
the sovereign. Thus, non-financial corporates are not usually
rated more than two notches above the sovereign (see Credit Policy
paper entitled "How Sovereign Credit Quality Can Affect Other
Ratings" and published on 16 March 2015).
Moody's expects Mobilink to maintain the largest market share by
the number of subscribers and keep its market share of 28%-29%
this year, given its strong brand and extensive network coverage.
Its holding of the largest 3G spectrum in Pakistan will also help
it maintain good network quality in 3G services. The company
launched its commercial 3G services last July.
Despite a difficult 2014 with intense competitive pressure and
regulatory changes such as the government's implementation of a
biometric verification system for all mobile subscriptions,
Mobilink has maintained a strong financial profile for its B1
rating level. Mobilink's adjusted debt/EBTIDA rose to about 1.5x
in FY2014, from 1.0x in FY2013, due to the 3G spectrum payment of
$300.9 million and $350 million in capex. However, leverage
remains very strong for the rating level.
Mobilink also maintains adequate liquidity. As of March 2015, the
company had a cash balance of $67 million and undrawn committed
lines totaling $93 million. Moody's expects the company's
operating cash flows to total around $300 million in the next 12
months. These funds will be sufficient to cover its short-term
debt of about $84 million and its total estimated capital
expenditure of around $300 million.
While Mobilink's rating does not include any uplift, its
fundamental credit profile continues to incorporate ongoing
operational and financial support from its indirect parents,
Global Telecom Holdings SAE (unrated), and its ultimate
shareholder, VimpelCom Ltd (Ba3 stable); both of which are
globally diversified and larger telecommunications groups.
Given Moody's guidelines regarding the differential between
government and corporate ratings, it is unlikely that Mobilink
will experience any upward rating pressure in the absence of an
upgrade of Pakistan's sovereign rating.
Alternatively, Mobilink would need to generate a substantially
greater revenue share from outside Pakistan, which seems unlikely
over the near to medium term. However, an upgrade is possible in
the medium to long term if, in addition to a sovereign upgrade,
Mobilink maintains its (1) strong market position with adjusted
EBITDA margin in excess of 35%; (2) current solid balance sheet
and financial profile; (3) strong relationships with its parents
and banks; and (4) sufficient cushion under its bank loan
covenants.
Mobilink's ratings would be under downward pressure if the
sovereign rating is downgraded, as Moody's will seek to maintain
the current gap of two notches between their ratings.
Given Mobilink's fundamental credit quality, it is unlikely its
rating will be downgraded for reasons other than a downward
sovereign rating action absent a precipitous decline in its
financial and operating profile. Such a decline would be evident
if Mobilink: (1) experiences significant deterioration in its
market share; (2) resumes paying dividends or increases management
fees to its parent, thereby reducing the available retained cash
flow to the extent that adjusted retained cash flow/debt falls
below 20%; (3) faces difficulty in accessing capital to fund
ongoing growth, or repay/refinance lines, as and when they fall
due; or (4) sees signs of Global Telecom or VimpelCom not
providing financial assistance, should there be any breach of
covenants.
The principal methodology used in this rating was Global
Telecommunications Industry published in December 2010.
Mobilink is the largest mobile operator in Pakistan by number of
subscribers.
=================
S I N G A P O R E
=================
ASIA-EURO HOLIDAYS: Closes Doors; 500 Customers Affected
--------------------------------------------------------
Maureen Koh and Ng Jun Sen at The New Paper report that Asia-Euro
Holidays closed down suddenly, leaving only an A4-sized paper
notice on the front door of its Chinatown Point office on May 22.
The report relates that the notice was, almost word for word, what
was on the shutters of well-known travel and coach company Five
Stars Tours when it closed just as abruptly in January last year.
According to the report, customers were asked to approach their
travel insurers or the Small Claims Tribunal and the Consumers
Association of Singapore if they had booked tours.
It is estimated that about 500 customers have been affected by
Asia-Euro's closure, the report states.
The New Paper relates that the tour agency, which had been in
business for 13 years, was taking bookings till last mid-May.
The report adds that Mr. Darren Chew, the company's head of
department for branch control, and marketing and communications,
confirmed its closure. He told Lianhe Wanbao that financial woes
had forced the company to shut its doors.
The travel agency's venture into property in 2010 had not turned
out well, he said, The New Paper relays. It had reportedly
invested in 14 apartments and landed properties in Singapore,
Malaysia and Thailand.
The New Paper relates that Mr Chew said it had lost SGD million,
of which SGD1 million was credit card debt.
Business registration records show that Asia-Euro Holidays'
directors are Tan Meow Hwee and Tay Jwee Hiang, the report notes.
MAIN STREET: Goes Out of Business as Cash Runs Dry
--------------------------------------------------
Rumi Hardasmalani at Today Online reports that Main Street Travels
went defunct last month after the company ran out of cash.
"Corporate bookings need capital and credit. We have had many
corporates not paying up. To fight them meant spending more money.
High local salaries, paid-up capital requirements, rentals, audit
costs and a host of other pre-requisites made survival tough. Many
general retail travel agents are out of business and many others
will soon be," Today Online quotes
Mr Sameer Gupta, owner of the agency, as saying.
* SINGAPORE: More Travel Agencies Go Bust as Consumers Go Online
----------------------------------------------------------------
Rumi Hardasmalani at Today Online reports that as more and more
travellers go online to book flights, hotel rooms and tours, a
rising number of home-grown travel agencies have been forced out
of business.
A total of 86 travel agencies shut shop in the first five months
of this year, surpassing the 80 new ones that obtained operating
licences, Singapore Tourism Board (STB) data showed, signalling a
shake-up in the industry segment, the report discloses.
Today Online relates that at the current pace of closures, the
number of firms going out of business this year is also set to
exceed the 114 that ceased operations last year. This will extend
the trend since 2011 when closures have risen year after year.
Meanwhile, 159 new travel agency licences were issued last year,
down from 163 in 2013, STB data showed, Today Online reports.
The report quotes Ms. Kay Swee Pin, president of Singapore
Outbound Travel Agents Association (SOTAA), as saying that: "In
fact, there are far too many travel agents in a small market such
as Singapore." As of December, there were 1,201 licensed travel
agents here, up from 973 in 2010 and 735 in 2005, the report
discloses.
====================
S O U T H K O R E A
====================
MAGNACHIP SEMICONDUCTOR: S&P Lowers CCR to 'CCC+'; Outlook Neg.
---------------------------------------------------------------
Standard & Poor's Ratings Services said that it has lowered to
CCC+' from 'B-' its long-term corporate credit and debt ratings on
Korea-based analog and mixed-signal semiconductor designer and
manufacturer MagnaChip Semiconductor Corp.. The outlook on the
long-term corporate credit rating is negative.
"The downgrade reflects our expectation that MagnaChip's cash on
hand will continue to decline over the next one to two years,
mainly due to weak operating profitability in its foundry
business," said Hong Kong-based credit analyst JunHong Park. "We
estimate the company will make substantial operating losses in
2015 because of weak demand for its high-end smartphone-related
products, a low fabrication utilization rate, and difficulties in
new customer and product development. We see limited prospects of
a turnaround over the next 12 months."
Standard & Poor's also sees uncertainty in legal disputes related
to the company's February 2015 restatement of its financial
results, and the outcomes could further impair its financial
position and liquidity. Although the company has recently
launched a program to optimize its costs and its portfolio to
improve operating efficiency, whether the company can achieve a
positive operating profit in the current challenging environment
is yet to be seen.
S&P expects MagnaChip to face increasing pressure on liquidity in
the next 12 to 24 months. Although, the company has no scheduled
principal debt repayments until 2021, S&P estimates deficits in
free operating cash flow will reduce its cash balance
substantially to about US$50 million or less over the next 12
months under S&P's base case scenario, compared with US$91 million
as of March 31, 2015. Because MagnaChip has no secured credit
facilities, S&P views the company as vulnerable and dependent on
favorable business, financial, and economic conditions to meet
financial commitments over the next one to two years.
The negative outlook reflects S&P's expectation that the company
will continue to make operating losses with substantial deficits
in free operating cash flow over the next several quarters. S&P
expects the company to rely mainly on cash on hand to meet
financial obligations over the next 12 months.
S&P may lower the ratings if it sees an increasingly high
likelihood the company will not meet its financial commitments
over the next 12 months. This could result from rapidly
deteriorating cash levels due to worse-than-anticipated operating
performance or unexpectedly large litigation expenses and
payments.
S&P may revise the outlook to stable if the company's operations
turn around and stabilize with sustainable generation of positive
free operating cash flow, although this scenario is less likely
over the next several quarters.
=============
V I E T N A M
=============
VIETNAM BANK: Moody's Assigns 'B1' Counterparty Risk Assessments
----------------------------------------------------------------
Moody's Investors Service assigned Counterparty Risk Assessments
(CR Assessments) to nine Vietnamese banks. The credit ratings
assigned to the nine Vietnamese banks remain unchanged.
Moody's has assigned the following long-term CR Assessments:
(1) B1(cr) assigned to Vietnam Bank for Industry and Trade
(Vietinbank) and Bank for Investment and Development of
Vietnam (BIDV);
(2) B2(cr) assigned to Asia Commercial Bank (ACB), Military
Commercial Joint Stock Bank (MB), Saigon-Hanoi Commercial
Joint Stock Bank (SHB), Saigon Thuong Tin Commercial Joint-
Stock Bank (Sacombank), Vietnam Prosperity Joint Stock
Commercial Bank (VP Bank), Vietnam Technological and
Commercial Joint Stock Bank (Techcombank) and Vietnam
International Bank (VIB).
Concurrently, Not-Prime (cr) short-term CR Assessments have been
assigned to all the Vietnamese banks.
Moody's has assigned long-term and short-term CR Assessments to
the nine Vietnamese banks.
CR Assessments are opinions of how counterparty obligations are
likely to be treated if a bank fails, and are distinct from debt
and deposit ratings in that they: (1) consider only the risk of
default rather than expected loss; and (2) apply to counterparty
obligations and contractual commitments rather than debt or
deposit instruments.
A CR Assessment is an opinion of the counterparty risk related to
a bank's covered bonds, contractual performance obligations
(servicing), derivatives (e.g., swaps), letters of credit,
guarantees and liquidity facilities.
For Vietnamese banks, the CR Assessment -- prior to government
support -- is positioned one notch above their Adjusted baseline
credit assessments (Adjusted BCAs). Moody's then assigns
government support assumptions, in line with the same support
assumptions on deposits and senior unsecured debt.
Such assignments reflect Moody's view that any support provided by
government authorities to a bank -- and which benefits senior
unsecured debt or deposits -- is very likely to benefit operating
activities and obligations reflected by the CR Assessments.
Such a view is consistent with Moody's belief that governments are
likely to maintain the banks' operations as a going concern to
reduce contagion and preserve the banks' critical functions.
In the case of the government-controlled banks Vietinbank and
BIDV, the starting points for the CR Assessments -- before
government support -- are B2 and B3, respectively, based on the
banks' Adjusted BCA plus one notch. Moody's then incorporates very
high support assumptions from the Vietnam government (B1 stable).
As a result, Moody's assigns CR Assessments of B1(cr) to both
Vietinbank and BIDV.
The CR Assessments assigned to the other seven Vietnamese banks,
which are majority-owned by private shareholders, are based on the
following inputs: (1) these banks' Adjusted BCAs plus one notch,
and (2) moderate probability of government support. As a result,
Moody's assigns CR Assessments of B2(cr) to ACB, MB, Sacombank,
SHB, Techcombank, VP Bank and VIB.
The principal methodology used in these ratings was Banks
published in March 2015.
Taking into account today's announcement, the bank ratings are as
follows:
Asia Commercial Bank
-- Local currency deposit ratings remain unchanged at B3/ Not
Prime with a positive outlook
-- Foreign currency deposit ratings remain unchanged at B3/ Not
Prime with a positive outlook
-- Local currency issuer ratings remain unchanged at B3/ Not
Prime with a positive outlook
-- Foreign currency issuer ratings remain unchanged at B3/ Not
Prime with a positive outlook
-- BCA and adjusted BCA remain unchanged at caa1
-- Assignment of CR Assessment of B2(cr)/ Not Prime(cr)
Headquartered in Ho Chi Minh, the bank reported total assets of
VND 179,610 billion (USD 8.4 billion) at end-December 2014.
Military Bank
-- Local currency deposit ratings remain unchanged at B3/ Not
Prime with a positive outlook
-- Foreign currency deposit ratings remain unchanged at B3/ Not
Prime with a positive outlook
-- Local currency issuer ratings remain unchanged at B3/ Not
Prime with a positive outlook
-- Foreign currency issuer ratings remain unchanged at B3/ Not
Prime with a positive outlook
-- BCA and adjusted BCA remain unchanged at caa1
-- Assignment of CR Assessment of B2(cr)/ Not Prime(cr)
Headquartered in Hanoi, the bank had total assets of VND 200,489
billion (USD 9.4 billion) at end-December 2014.
Sacombank
-- Local currency deposit ratings remain unchanged at B3/ Not
Prime with a positive outlook
-- Foreign currency deposit ratings remain unchanged at B3/ Not
Prime with a positive outlook
-- Local currency issuer ratings remain unchanged at B3/ Not
Prime with a positive outlook
-- Foreign currency issuer ratings remain unchanged at B3/ Not
Prime with a positive outlook
-- BCA and adjusted BCA remain unchanged at caa1
-- Assignment of CR Assessment of B2(cr)/ Not Prime(cr)
Headquartered in Ho Chi Minh, the bank had total assets of VND
178,939 billion (USD 8.4 billion) at end-December 2014.
VIB
-- Local currency deposit ratings remain unchanged at B2/ Not
Prime with a stable outlook
-- Foreign currency deposit ratings remain unchanged at B2/ Not
Prime with a stable outlook
-- Local currency issuer ratings remain unchanged at B2/ Not
Prime with a stable outlook
-- Foreign currency issuer ratings remain unchanged at B2/ Not
Prime with a stable outlook
-- BCA and adjusted BCA remain unchanged at b3
-- Assignment of CR Assessment of B2(cr)/ Not Prime(cr)
Headquartered in Hanoi, the bank had total assets of VND 80,661
billion (USD 3.8 billion) at end-December 2014.
Techcombank
-- Local currency deposit ratings remain unchanged at B3/ Not
Prime with a positive outlook
-- Foreign currency deposit ratings remain unchanged at B3/ Not
Prime with a positive outlook
-- Local currency issuer ratings remain unchanged at B3/ Not
Prime with a positive outlook
-- Foreign currency issuer ratings remain unchanged at B3/ Not
Prime with a positive outlook
-- BCA and adjusted BCA remain unchanged at caa1
-- Assignment of CR Assessment of B2(cr)/ Not Prime(cr)
Headquartered in Hanoi, the bank had total assets of VND 175,902
billion (USD 8.2 billion) at end-December 2014.
VP Bank
-- Local currency deposit ratings remain unchanged at B3/ Not
Prime with a positive outlook
-- Foreign currency deposit ratings remain unchanged at B3/ Not
Prime with a positive outlook
-- Local currency issuer ratings remain unchanged at B3/ Not
Prime with a positive outlook
-- Foreign currency issuer ratings remain unchanged at B3/ Not
Prime with a positive outlook
-- BCA and adjusted BCA remain unchanged at caa1
-- Assignment of CR Assessment of B2(cr)/ Not Prime(cr)
Headquartered in Hanoi, the bank had total assets of VND 163,241
billion (USD 7.6 billion) at end-December 2014.
VietinBank
-- Local currency deposit ratings remain unchanged at B1/ Not
Prime with a stable outlook
-- Foreign currency deposit ratings remain unchanged at B2/ Not
Prime with a stable outlook
-- Local currency issuer ratings remain unchanged at B1/ Not
Prime with a stable outlook
-- Foreign currency issuer ratings remain unchanged at B1/ Not
Prime with a stable outlook
-- The foreign currency senior unsecured rating remains
unchanged at B1
-- BCA and adjusted BCA remain unchanged at b3
-- Assignment of CR Assessment of B1(cr)/ Not Prime(cr)
Headquartered in Hanoi, the bank had total assets of VND 667,132
billion (USD 31 billion) at end-December 2014.
BIDV
-- Local currency deposit ratings remain unchanged at B1/ Not
Prime with a stable outlook
-- Foreign currency deposit ratings remain unchanged at B2/ Not
Prime with a stable outlook
-- Local currency issuer ratings remain unchanged at B1/ Not
Prime with a stable outlook
-- Foreign currency issuer ratings remain unchanged at B1/ Not
Prime with a stable outlook
-- BCA and adjusted BCA remain unchanged at caa1
-- Assignment of CR Assessment of B1(cr)/ Not Prime(cr)
Headquartered in Hanoi, the bank had total assets of VND 650,340
billion (USD 30 billion) at end-December 2014.
SHB
-- Local currency deposit ratings remain unchanged at B3/ Not
Prime with a stable outlook
-- Foreign currency deposit ratings remain unchanged at B3/ Not
Prime with a stable outlook
-- Local currency issuer ratings remain unchanged at B3/ Not
Prime with a stable outlook
-- Foreign currency issuer ratings remain unchanged at B3/ Not
Prime with a stable outlook
-- BCA and adjusted BCA remain unchanged at caa1
-- Assignment of CR Assessment of B2(cr)/ Not Prime(cr)
Headquartered in Hanoi, the bank had total assets of VND 169,036
billion (USD 7.9 billion) at end-December 2014.
*********
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 2015. 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 202-362-8552.
*** End of Transmission ***