/raid1/www/Hosts/bankrupt/TCRAP

/raid1/www/Hosts/bankrupt/TCRAP_Public/160414.mbx T R O U B L E D C O M P A N Y R E P O R T E R A S I A P A C I F I C Thursday, April 14, 2016, Vol. 19, No. 73 Headlines A U S T R A L I A AQUA COOLER: First Creditors' Meeting Set For April 21 DYNASTY CORP: First Creditors' Meeting Set For April 21 QUEENSLAND NICKEL: If Liquidated, Taxpayers to Fund Payouts SYDNEY ALLEN: Mascot Printing Steps in to Help VIP SHEDS: Goes Into Liquidation C H I N A CHINA SHANSHUI: Courts Order Unit to Pay Creditors US$372MM DELTA TECHNOLOGY: Receives Nasdaq Listing Non-Compliance Notice LDK SOLAR: Grand Court of Cayman Islands Orders Liquidation SUNSHINE 100: Fitch Affirms 'B-' LT Issuer Default Ratings SUNTECH POWER: U.S. Unit's Plan Hearing Adjourned to April 27 ZOOMLION HEAVY: S&P Affirms B+ Corp. Credit Rating; Outlook Neg. I N D I A A.N.R COTTON: ICRA Suspends B+ Rating on INR11.0cr Loan AGNI LIMITED: CRISIL Suspends B Rating on INR34.6MM Cash Loan AMBO EXPORTS: CRISIL Suspends D Rating on INR700MM Loan AMIT ENGINEERS: ICRA Assigns 'B+' Rating to INR4.10cr Loan ANKIT INTERNATIONAL: ICRA Assigns 'B' Rating to INR35cr Loan AUSTIN DISTRIBUTORS: CRISIL Suspends B- Rating on INR273.5MM Loan B.R. GUAR: ICRA Reaffirms B+ Rating on INR5.50cr Cash Loan B.S. AGRICULTURE: ICRA Assigns B/A4 Rating to INR5.50cr Loan BHALARA COTTON: ICRA Reaffirms 'B' Rating on INR17cr LT Loan BORSE BROTHERS: CRISIL Cuts Rating on INR93.7MM Loan to B- CHALLANI RANKA: ICRA Suspends B+ Rating on INR10cr Bank Loan COMPETENT DYESTUFF: ICRA Suspends B Rating on INR10cr Loan COOCH BEHAR: ICRA Reaffirms B- Rating on INR34.49cr Term Loan CYBERWALK TECH: ICRA Reaffirms 'D' Rating on INR68.84cr Loan DEV BHOOMI: ICRA Assigns 'B' Rating to INR6.0cr Term Loan EMERALD INDUSTRIES: ICRA Suspends B-/A4 Rating on INR14.80cr Loan FILTER MANUFACTURING: CRISIL Suspends D Rating on INR35MM Loan GANTA SRIRAM: ICRA Assigns B+ Rating to INR5.90cr LT Loan GROWTHPATH SOLUTIONS: CRISIL Assigns 'B' Rating to INR60MM Loan HINDUSTAN WINDOWS: Ind-Ra Suspends IND B- Long-Term Issuer Rating ICA EDU: Ind-Ra Assigns 'IND BB' Long-Term Issuer Rating JBJ TECHNOLOGIES: ICRA Reaffirms 'B' Rating on INR7.25cr Loan KAILASH EDUCATIONAL: Ind-Ra Rates INR90MM Term Loan 'IND BB-' KALINGA FERRO: CRISIL Suspends D Rating on INR221MM Cash Loan KCRM FOODS: CRISIL Assigns 'B' Rating to INR45MM Cash Loan KDM CLOTHING: Ind-Ra Affirms 'IND BB-' Long-Term Issuer Rating KIRPA FOODS: ICRA Assigns 'B' Rating to INR22.50cr Loan KPR INDUSTRIES: ICRA Lowers Rating on INR337.54cr Loan to D MA MAHAMAYA: CRISIL Suspends B Rating on INR60MM Term Loan MADHOOR BUILDWELL: CRISIL Reaffirms B+ Rating on INR204.5MM Loan MANGALA CASHEW: ICRA Assigns B+ Rating to INR10cr LT Loan MG WELL: ICRA Lowers Rating on INR4.0cr Loan to 'D' MITTAL ALLOY: CRISIL Assigns 'B' Rating to INR33MM LT Loan MULCHAND FIBER: CRISIL Reaffirms B Rating on INR89.2MM Term Loan NARULA FOODS: CRISIL Suspends D Rating on INR196MM Cash Loan PRECISE SEAMLESS: Ind-Ra Assigns 'IND BB' Long-Term Issuer Rating R.H. SORTEX: ICRA Assigns D Rating to INR5.62cr Loan RAMALINGA REDDY: CRISIL Assigns B+ Rating to INR45MM LT Loan SEAGA INDIA: ICRA Reaffirms 'B+' Rating on INR8.0cr Term Loan SHAKUN GASES: CRISIL Assigns 'B' Rating to INR40MM Cash Loan SHANTI GOPAL: ICRA Revises Rating on INR40cr LT Loan to 'B' SHREE KRISHNA: ICRA Lowers Rating on INR48cr LT Loan to 'D' SHREE SANYEEJI: CRISIL Suspends D Rating on INR440MM Cash Loan SHYAMA SAKTI: CRISIL Suspends D Rating on INR50MM Cash Loan SIDDARTH ORGANISATION: ICRA Assigns B+ Rating to INR2.16cr Loan SKD REALTY: ICRA Assigns B+ Rating to INR25cr LT Loan SMVD POLYPACK: CRISIL Suspends B+ Rating on INR105MM LT Loan SRI BALAJI: CRISIL Suspends D Rating on INR650MM Cash Loan SRI SUBRAMANYESWARA: ICRA Assigns 'B' Rating to INR12.70cr Loan SRI VIJAYA: CRISIL Reaffirms 'B' Rating on INR70MM Cash Loan SUMIT GAS: CRISIL Suspends D Rating on INR40MM Bank Loan SUNSHAKTI OIL: Ind-Ra Assigns 'IND D' Long-Term Issuer Rating SUSHEEL YARNS: CRISIL Suspends B+ Rating on INR85MM Cash Loan SUYAMBU PROJECTS: CRISIL Assigns B Rating to INR60MM Cash Loan SVL TRADING: Weak Financial Strength Cues ICRA SP 3D1 Grading VARDA SPINNING: CRISIL Suspends B+ Rating on INR100MM Loan J A P A N TAKATA CORP: To Seek Restructuring Sponsor by August N E W Z E A L A N D CJ SOLUTIONS: In Liquidation; Owes More Than NZ$4.5MM EVERGREEN LODGE: Lodges Placed Under Receivership P A K I S T A N PAKISTAN: Fitch Affirms 'B' Long-Term Issuer Default Ratings T A I W A N WAN HAI: Moody's Retains Ba2 CFR on Slightly Weaker 2015 Results - - - - - ================= A U S T R A L I A ================= AQUA COOLER: First Creditors' Meeting Set For April 21 ------------------------------------------------------ John Melluish and Robyn Duggan of Ferrier Hodgson were appointed as administrators of Aqua Cooler Pty Limited on April 11, 2016. A first meeting of the creditors of the Company will be held at Ferrier Hodgson, Level 13, 225 George Street, in Sydney, on April 21, 2000, at 10:30 a.m. DYNASTY CORP: First Creditors' Meeting Set For April 21 ------------------------------------------------------- Kimberley Stuart Wallman at HLB Mann Judd (Insolvency WA) was appointed as administrator of Dynasty Corporation Pty Ltd, trading as Dynasty Drycleaners, on April 11, 2016. A first meeting of the creditors of the Company will be held at Level 3, 35 Outram Street, in West Perth, on April 21, 2016, at 10:30 a.m. QUEENSLAND NICKEL: If Liquidated, Taxpayers to Fund Payouts ----------------------------------------------------------- Mark Ludlow at Australian Financial Review reports that federal taxpayers will have to pick up the tab for most of Queensland Nickel's AUD110 million in debts if it is placed in liquidation later this month. With Clive Palmer failing to officially lodge his AUD250 million rescue plan and proponents of a community and worker buy-back deciding they will not submit a proposal, administrator FTI Consulting is expected to be left with little choice but to recommend to creditors the company be wound up, according to AFR. If the former operating company is placed into liquidation, the bulk of the debts -- or about AUD70 million of worker entitlements -- will be picked up by the federal government's Fair Entitlements Guarantee Scheme, the report states. According to AFR, Mr. Palmer's calculated ploy to get taxpayers to help cover his debts has angered the cash-strapped Turnbull government. "The moral and legal responsibility for the payment of entitlements of all Queensland Nickel workers lies with Mr Palmer, not the taxpayer," the report quotes a spokesman for Employment Minister Michaelia Cash as saying. "It is up to Clive Palmer and the management of Queensland Nickel Sales to urgently make arrangements to ensure that employees are not denied their lawful entitlements." AFR says the potential AUD70 million-plus payment would easily be the largest claim under the Fair Entitlements Guarantee Scheme. If the federal government pays the worker's entitlements, that will leave about AUD40 million in debts to trade creditors such rail company Aurizon (AUD20 million), the Australian Taxation Office, nickel mines in New Caledonia and electricity and gas suppliers to Mr Palmer's Yabulu refinery just north of Townsville. AFR relates that Mr Palmer, the resources tycoon turned federal MP, has remained coy in the past few weeks about whether he would submit a deed of company arrangement for Queensland Nickel. This followed his audacious bid last month to take back operational control of the Townsville refinery through the creation of a new operating company, Queensland Nickel Sales. He then promptly mothballed the refinery until July, forcing 550 workers out of a job, the report says. If Queensland Nickel is placed into liquidation Mr Palmer could leave himself exposed to charges of being a shadow director and insolvent trading, as well as QNI's parent companies, QNI Metals and QNI Resources, being chased for outstanding debts, AFR states. According to AFR, Mr Palmer said he hadn't been a director of Queensland Nickel in February last year, while QNI's financial accounts were signed off by Ernst & Young in September last year. Mr Palmer denied he will be chased for outstanding debts after FTI Consulting submits its report to creditors in the next few weeks, adds AFR. "If it goes into liquidation that's just what happens. Companies go into liquidation across the country everyday," the report quotes Mr. Palmer as saying in an interview. "If there's a debt to that company, it's a company debt. Provided the company has traded while solvent -- which the administrators will report on -- that's where it ends. I haven't had any involvement in any of it." If Mr Palmer decides to re-open the Yabulu refinery he will have to negotiate new agreements with suppliers such as Aurizon, AFR states. According to the report, the rail company which transports the nickel products to and from the Port of Townsville has already allocated AUD18 million in provisional losses for its debts from Queensland Nickel. With the refinery shut until at least July 30, Aurizon has already called for 18 voluntary redundancies from its 110 Townsville-based train drivers, AFR says. AFR says FTI Consulting director John Park late last month warned Mr Palmer was running out of time to lodge his deed of company arrangement before they report back to creditors in mid-April. AFR relates that Sister City Partners director Warwick Powell, who is trying to co-ordinate a creditor-worker buyback of the Townsville refinery, also confirmed they would not submit a rescue plan for Queensland Nickel, but they were still interested in buying the refinery assets off Mr Palmer. "We wouldn't proceed with the buyback if those debts were transferred to a new operating company. There is no reason why a brand new company would be interested in taking on the liability of an old company," AFR quotes Mr Powell as saying. Queensland Nickel operates the Palmer Nickel and Cobalt Refinery in Queensland, Australia. Queensland Nickel directors appointed John Park, Stefan Dopking, Kelly-Anne Trenfield and Quentin Olde of FTI Consulting as voluntary administrators on Jan. 18, 2016. SYDNEY ALLEN: Mascot Printing Steps in to Help ---------------------------------------------- Broede Carmody at SmartCompany reports that a multimillion-dollar printing business that collapsed into voluntary administration last week has been thrown a potential lifeline after a competitor decided to step in to operate the company while administrators assess a possible restructure. Sydney Allen Printers, which is based in Parramatta in New South Wales and turns over around AUD14 million annually, appointed external managers last week, SmartCompany relates. However Sydney Allen Printers continues to trade, with fellow printing company Mascot Printing entering into a licence agreement to manage the business while administrators explore a possible sale or restructure, according to SmartCompany. In a statement issued to SmartCompany, Mascot Printing's managing director Joe Pizzo said he is "very pleased" to be able to support Sydney Allen Printers. "With key staff and management onboard and the financial backing of Mascot, we are confident that we will be able to service all Sydney Allen customers without any interruption," Mr. Pizzo said, notes the report. Sydney Allen Printers employs around 50 people, with a creditors' meeting scheduled for April 19. The report says Mascot Printing has signalled its interest in purchasing Sydney Allen once the voluntary administration process wraps up. SmartCompany understands that should Mascot Printing put up its hand to purchase Sydney Allen Printers, it would aim to retain as many staff as possible. VIP SHEDS: Goes Into Liquidation -------------------------------- Cliff Sanderson at Dissolve.com.au reports that VIP Sheds Pty Ltd has gone into liquidation. Barry Kenneth Hamilton of Barry Hamilton and Associates has been appointed liquidator of the company on April 7, 2016, the report discloses. According to Dissolve.com.au, the liquidation reportedly left the fabrication company's customers out of pocket. These customers have deposited money on sheds, which haven't been delivered. The liquidator is currently investigating the matter, the report states. ========= C H I N A ========= CHINA SHANSHUI: Courts Order Unit to Pay Creditors US$372MM ----------------------------------------------------------- Reuters reports that Chinese courts have ordered cash-strapped Shandong Shanshui Cement Group Ltd to pay back its creditors CNY2.4 billion ($372 million), the company said in a statement posted on the Shanghai Clearing House website on April 12. Reuters relates that the company said it was unlikely to be able to make the required payments due to financial difficulties, and the courts would take steps such as auctioning off the firm's assets to meet these obligations. Defaults have accelerated among Chinese companies, particularly in the heavy industrial sectors including steel and cement, which have been hard hit by China's economic slowdown, says Reuters. According to the news agency, bond defaults by the cement maker, a subsidiary of Hong Kong-listed China Shanshui Cement Group Ltd, had led creditors to turn to legal avenues to seek repayments. Reuters relates that Shandong Shanshui Cement's statement to the clearing house outlined the current status of almost 100 suits against the indebted company and showed that various courts had ordered it to pay back principal and interest to creditors burnt by unmet bond repayments. Courts have ruled on eight out of a total 96 cases against the company, although these were some of the largest suits, the statement, as cited by Reuters, showed. The total amount being sought is around $764 million. The courts have ordered repayments to be made to creditors including China Merchants Bank, Qilu Asset Management and regional lender China Guangfa Bank (CGB), adds Reuters. About China Shanshui China Shanshui Cement Group Limited is engaged in manufacturing and sale of cement and clinker, and limestone mining. The Company is engaged in the production and sales of various types of cements, and the production of commodity clinker necessary for various types of high grade cements in Shandong and Liaoning Provinces. The commodity clinker produced by the Company is mainly sold to clients with cement grinding station. The cement produced by the Company under the brand of Shanshui Dongyue is widely used in construction works for roads, bridges, housing and various types of construction projects. The Company operates in four geographical areas: Shandong Province, Northeastern China, Xinjiang Region and Shanxi Province. As reported in the Troubled Company Reporter-Asia Pacific on Nov. 17, 2015, Standard & Poor's Ratings Services said that it had lowered its long-term corporate credit rating on China Shanshui Cement Group Ltd. to 'D' from 'CC'. At the same time, S&P lowered its long-term Greater China regional scale rating on the company to 'D' from 'cnCC'. S&P also lowered its issue rating on Shanshui's U.S. dollar- denominated senior unsecured notes to 'D' from 'CC' and the Greater China regional scale rating on the notes to 'D' from 'cnCC'. Shanshui is a China-based cement producer. DELTA TECHNOLOGY: Receives Nasdaq Listing Non-Compliance Notice ------------------------------------------------------------- Delta Technology Holdings Limited ("Delta" or "the Company"), a leading provider of specialty chemicals, on April 7 disclosed that it received written notice from the Nasdaq Stock Market ("Nasdaq") stating that the Company is no longer in compliance with the $1.00 minimum bid price requirement for continued listing on The Nasdaq Capital Market, as set forth in Nasdaq Listing Rule 5550(a)(2). The notice has no immediate effect on the listing of the Company's ordinary shares, par value $.00001 per share (the "Ordinary Shares") and the Redeemable Ordinary Share Purchase Warrants (the "Warrants"), and the Ordinary Shares and Warrants will continue to trade on The Nasdaq Capital Market under the symbol "DELT" and "DELTW", respectively, at this time. In accordance with Nasdaq Listing Rule 5810(c)(3)(A), the Company has a grace period of 180 calendar days, or until September 26, 2016 ("Compliance Period"), to regain compliance with the minimum bid price requirement. To regain compliance, the bid price of the Company's common stock must meet or exceed $1.00 per share for at least ten consecutive business days during the Compliance Period. If the Company does not regain compliance with the minimum bid price requirement by September 26, 2016, Nasdaq may provide written notification to the Company that its securities will be subject to delisting. At that time, the Company may have alternatives to obtain an extension and/or avoid delisting, including an appeal of Nasdaq's delisting determination to the Nasdaq Listing Qualifications Panel. The Company intends to monitor the bid price of its Ordinary Shares between now and September 26, 2016 and will consider the various options available to it if its common stock does not trade at a level that is likely to regain compliance. About Delta Technology Holdings Ltd. Founded in 2007, Delta (NASDAQ: CISAW) is a China-based fine and specialty chemical company producing and distributing organic compound including para-chlorotoluene ("PCT"), ortho- chlorotoluene ("OCT"), PCT/OCT downstream products, unsaturated polyester resin ("UPR"), maleic acid ("MA") and other by-product chemicals. The end application markets of the Company's products include Automotive, Pharmaceutical, Agrochemical, Dye & Pigments, Aerospace, Ceramics, Coating-Printing, Clean Energy and Food Additives. Delta has approximately 300 employees, 25% of whom are highly-qualified experts and technical personnel. The Company serves nearly 400 clients in various industries. LDK SOLAR: Grand Court of Cayman Islands Orders Liquidation ----------------------------------------------------------- LDK Solar CO., Ltd., in Official Liquidation, on April 7 disclosed that on April 6, 2016, subsequent to the filing on February 11, 2016 of a joint creditors' petition dated February 5, 2016 (the "Petition") in the Grand Court of the Cayman Islands (the "Cayman Court"), the Cayman Court ordered that the Company be wound up in accordance with the Companies Law (2013 Revision) (as amended) (the "Cayman Order"). The Cayman Court further ordered that David Martin Griffin of FTI Consulting (Cayman) at Suite 3212, 53 Market Street, Camana Bay, PO Box 30613, Grand Cayman, KY1-1203, Cayman Islands and John Howard Batchelor of FTI Consulting, Level 22, The Center, 99 Queen's Road Central, Central, Hong Kong, be appointed as Joint Official Liquidators of the Company ("JOLs") and that the JOLs be authorized to, amongst other things, do any acts or things considered by them to be necessary or desirable in connection with the liquidation of the Company and the winding up of its affairs. About LDK Solar LDK Solar Co., Ltd. -- http://www.ldksolar.com/-- based in Hi- Tech Industrial Park, Xinyu City, Jiangxi Province, People's Republic of China, is a vertically integrated manufacturer of photovoltaic products, including high-quality and low-cost polysilicon, solar wafers, cells, modules, systems, power projects and solutions. LDK Solar was incorporated in the Cayman Islands on May 1, 2006, by LDK New Energy, a British Virgin Islands company wholly owned by Xiaofeng Peng, LDK's founder, chairman and chief executive officer, to acquire all of the equity interests in Jiangxi LDK Solar from Suzhou Liouxin Industry Co., Ltd., and Liouxin Industrial Limited. LDK Solar in February 2014 filed in the Cayman Islands for the appointment of provisional liquidators, four days before it was due to make a $197 million bond repayment. Its Joint Provisional Liquidators are Tammy Fu and Eleanor Fisher, both of Zolfo Cooper (Cayman) Limited. In September 2014, LDK Solar, LDK Silicon and LDK Silicon Holding Co., Limited each applied to file an originating summons to commence their restructuring proceedings in the High Court of Hong Kong. On Oct. 21, 2014 three U.S. subsidiaries of LDK Solar, LDK Solar Systems, Inc., LDK Solar USA, Inc. and LDK Solar Tech USA, Inc. filed voluntary petitions to reorganize under Chapter 11 of the United States Bankruptcy Code in the United States Bankruptcy Court for the District of Delaware. The lead case is In re LDK Solar Systems, Inc. (Bankr. D. Del., Case No. 14-12384). On Oct. 21, 2014, LDK Solar filed a petition in the same U.S. Bankruptcy Court for recognition of the provisional liquidation proceeding in the Grand Court of the Cayman Islands. The Chapter 15 case is In re LDK Solar CO., Ltd. (Bankr. D. Del., Case No. 14-12387). The U.S. Debtors' General Counsel is Jessica C.K. Boelter, Esq., at Sidley Austin LLP, in Chicago, Illinois. The U.S. Debtors' Delaware counsel is Robert S. Brady, Esq., Maris J. Kandestin, Esq., and Edmon L. Morton, Esq., at Young, Conaway, Stargatt & 73 Taylor, LLP, in Wilmington, Delaware. The U.S. Debtors' financial advisor is Jefferies LLC. The Debtors' voting and noticing agent is Epiq Bankruptcy Solutions, LLC. The U.S. Debtors commenced the Chapter 11 Cases in order to implement the prepackaged plan of reorganization, with respect to which the U.S. Debtors launched a solicitation of votes on Sept. 17, 2014, from the holders of LDK Solar's 10% Senior Notes due 2014, as guarantors of the Senior Notes, and required such holders of the Senior Notes to return their ballots by Oct. 15, 2014. Holders of the Senior Notes voted overwhelmingly in favor of accepting the Prepackaged Plan. SUNSHINE 100: Fitch Affirms 'B-' LT Issuer Default Ratings ---------------------------------------------------------- Fitch Ratings has affirmed China-based Homebuilder Sunshine 100 China Holdings Ltd.'s (Sunshine 100) Long-Term Foreign-Currency Issuer Default Ratings (IDR) at 'B-'. The Outlook is revised to Negative from Positive. Sunshine 100's senior unsecured rating and the rating on its outstanding $US215m senior notes due in 2017 have been downgraded to 'CCC+' from 'B-', with a Recovery Rating of 'RR5'. The Outlook revision reflects significant headwinds for the homebuilder as slower growth in housing sales resulted in insufficient cash flow to support the expansion of its commercial property business. Contracted sales turnover, measured by contracted sales to gross debt, slowed to 0.4x, and leverage, measured by net debt to adjusted inventory, surged to 62%. The IDR was affirmed at 'B-' because the company does not have an imminent liquidity shortage, and it may yet gradually improve its business model by cutting back land purchases and disposing of lower-quality projects. The one-notch downgrade of the senior unsecured rating reflects Fitch's expectations of lower recovery in the event of a default, which may be seen in the shift in the Recovery Rating to 'RR5', which represents below average recovery prospects, from 'RR4', which represents average recovery prospects. KEY RATING DRIVERS Contracted Sales Miss Target: Sunshine 100's contracted sales rose 12.4% to CNY7.5billion in 2015, which was below the management's target. Most of the company's projects acquired before 2015 are in areas with excessive property inventories or in lower-tier cities, which have slower turnover and less predictable sales. Sunshine 100 needs to generate contracted sales to support its large development expenditure which includes the expansion of its investment properties. The slower-than- expected contracted sales turnover has put pressure on its financial flexibility. Asset Quality Improving Gradually: Sunshine 100 is refocusing its resources on better located projects in 2015 to improve its sales performance. The company acquired four land parcels with gross floor area (GFA) of 1.5 million square metres (sqm) in 2015 for attributable land premium of CNY1.1billion. The four sites are of better quality and well-located. Sunshine 100 could gradually improve its asset quality to support contracted sales growth if it continues this disciplined land purchase strategy. The company's total attributable land reserve was 10.5million sqm of GFA at end-2015. Persistent High Development Expenditure: Sunshine 100's high development expenditure has increased its cash needs and hurt its financial profile. The company has had high construction budgets since 2014, and the budget is CNY6billion in 2016, representing 60% of total planned contracted sales. This is driven by its large construction scale; the company had total GFA under construction of 3.4 million sqm at end-2015, among which 1.9 million sqm were started in 2015. Leverage to Remain High: Sunshine 100's net debt increased 55% yoy at end-2015, which drove leverage to 62% from 51% at end- 2014. However, if its efforts in raising contracted sales, project destocking and improving asset quality go as the management expects, its leverage could be maintained at 60%-65% in the next 12-18 months. Sustainable Liquidity: Sunshine 100's short-term debt payable in 2016 is less than 25% of total debt, which reached CNY20billion at the end of 1Q16. Fitch believes Sunshine 100's liquidity is sustainable in the next 12-months because it has an undrawn bank facility of CNY5.7billion and domestic bond issuance quota of CNY3.7billion approved by China Securities Regulatory Commission (CSRC). KEY ASSUMPTIONS "Fitch's key assumptions within our rating case for the issuer include: -- Mild growth in contracted sales in 2016 -- Active inventory destocking and sales of lower-quality assets to improve asset quality and ease liquidity -- Selective and disciplined land purchases to improve land bank quality and support contract sales growth -- Development expenditure remains high at around CNY6billion in 2016 -- Profit margins remain under pressure" RATING SENSITIVITIES Negative: Future developments that may, individually or collectively, lead to negative rating action include: -- Net debt/adjusted inventory sustained above 65% (2015: 62%) -- Contracted sales/total debt sustained below 0.4x (2015: 0.4x) -- EBITDA margin sustained below 10% (2015: 11%) -- Deterioration in Sunshine 100's liquidity position, such as failure to refinance its existing $US215m offshore bond maturing in 2017 in the next 12-18 months Positive: The current rating is on Negative Outlook. Fitch does not anticipate developments with a material likelihood, individually or collectively, of leading to a rating upgrade. However, if the above factors do not materialise, then the Outlook may revert to Stable. FULL LIST OF RATING ACTIONS -- Long-Term Foreign-Currency IDR affirmed at 'B-', Outlook revised to Negative from Positive -- Senior unsecured rating downgraded to 'CCC+' from 'B-', with a Recovery Rating of 'RR5' -- $US215 million 12.75% senior unsecured notes due 2017 downgraded to 'CCC+' from 'B-', with a Recovery Rating of 'RR5' SUNTECH POWER: U.S. Unit's Plan Hearing Adjourned to April 27 ------------------------------------------------------------- Suntech America, Inc., and its affiliated debtors announced that the hearing to consider confirmation of their plan of liquidation has been adjourned for April 27, 2016 at 1:00 p.m. (prevailing Eastern Time) before The Honorable Christopher S. Sontchi, United States Bankruptcy Judge, in the Bankruptcy Court, 824 North Market Street, 5th Floor, Courtroom 6, Wilmington, Delaware 19801. Based on the date of the Confirmation Hearing, each of (i) the Deadline to File Memoranda of Law and/or Affidavits in Support of Confirmation of the Combined Plan and Disclosure Statement,2 (ii) the Deadline to File Replies to any Objections to the Combined Plan and Disclosure Statement, and (iii) the Vote Report Filing Deadline has been extended to April 25, 2016 at 12:00 p.m. (prevailing Eastern Time). On Nov. 17, 2015, the Debtors, with the support of the Committee, filed the Debtors' Combined Disclosure Statement and Chapter 11 Plan of Liquidation. On Jan. 14, 2016, the Court entered an order approving the Solicitation Procedures Motion and authorizing the Debtors to solicit votes on the Combined Plan and Disclosure Statement. The Court set a Feb. 16 deadline for ballots and objections, and a Feb. 25 hearing to consider confirmation of the Plan. The Feb. 25 hearing was adjourned by the Debtors. On Feb. 19, the Debtors filed an omnibus objection to disputed warranty-related claims solely for purposes of voting to accept or reject the Plan. The Debtors explained that they have received claims on account of warranties provided by former affiliate Wuxi Suntech Power Co., Ltd., to customers of photovoltaic (PV) modules. According to the Debtors, Wuxi has agreed to honor the warranties with the same force, effect and validity as such warranties existed prior to the sale of Wuxi to Jiangsu Sunfeng Photovoltaic Technology Co., Ltd. in April 2014. The Debtors have examined the disputed warranty claims and have determined that such Claims seek recovery for amounts for which the Debtors have no liability. On March 4, Wuxi Suntech Power Co. Ltd., responded to the Omnibus Objection, acknowledging that "Wuxi has agreed to reconfirm its obligation to honor Old Wuxi's standard warranties in effect on the day Wuxi purchased Old Wuxi's assets in the PRC with the same force, effect and validity as such warranties existed against Old Wuxi." However, Wuxi objects to the Debtors' characterization that the Disputed Warranty Claims "all relate to claims that arise under, or are otherwise covered by, the Warranties." The Chapter 11 Plan Suntech America, Inc., et al., filed with the U.S. Bankruptcy Court for the District of Delaware a combined disclosure statement and Chapter 11 plan of liquidation, which serve as the culmination of extensive negotiations between the Debtors, the Official Committee of Unsecured Creditors, The Solyndra Residual Trust and Wuxi Suntech Power Co., Ltd./Suntech Power Asia Pacific. Majority of the Debtors' assets have already been liquidated to cash. The Debtor has $16.3 million in cash and cash equivalents. A plan settlement provides for the resolution of two significant disputed claims against the Debtors (The Solyndra Residual Trust's $1.5 billion Claim and Wuxi Suntech Power Co.'s approximate $145 million Claim). The general unsecured claims of Solyndra and Wuxi are allowed at $360,441,916 and these claimants have agreed to a payment of $10,312,500 plus 60% of the total value of any additional assets, for a 2.86% recovery. Holders of other general unsecured claims totaling $6 million are slated to recover 30%. Holders of equity interests will receive the remaining cash after distribution to holders of allowed claims have been made. A black-lined version of the Combined Plan filed Jan. 14, 2016, is available for free at http://bankrupt.com/misc/SUNTECHplan0114.pdf About Suntech America Headquartered in San Francisco, California, Suntech America, Inc., aka Suntech Power, an affiliate of Wuxi, China-based Suntech Power Holdings Corp., was the main operating subsidiary of the Suntech Group in the Americas and its primary business purpose was acting as an intermediary for marketing, selling and distributing Suntech Group manufactured products. Suntech America, Inc., and Suntech Arizona, Inc. filed for Chapter 11 bankruptcy protection (Bankr. D. Del. Case Nos. 15- 10054 and 15-10056) on Jan. 12, 2015. Judge Christopher S. Sontchi presides over the cases. Mark D. Collins, Esq., Paul Noble Heath, Esq., William A. Romanowicz, Esq., Zachary I Shapiro, Esq., at Richards, Layton & Finger, P.A., serve as the Debtors' bankruptcy counsel. Upshot Services LLC is the Debtors' claims and noticing agent. The Debtors estimated their assets at between $100 million and $500 million, and their debts at between $100 million and $500 million. ZOOMLION HEAVY: S&P Affirms B+ Corp. Credit Rating; Outlook Neg. ---------------------------------------------------------------- Standard & Poor's Ratings Services affirmed its 'B+' long-term corporate credit rating on Zoomlion Heavy Industry Science and Technology Co. Ltd. The outlook is negative. S&P also affirmed its 'cnBB-' long-term Greater China regional scale rating on the China-based machinery maker. At the same time, S&P affirmed its 'B+' long-term issue ratings and 'cnBB-' long-term Greater China regional scale ratings on US$400 million 6.875% senior unsecured notes due 2017 and US$600 million 6.125% senior unsecured notes due 2022 issued by Zoomlion H.K. SPV Co. Ltd. Zoomlion guarantees the notes. "We affirmed the rating to reflect Zoomlion's moderately declining leverage over the next 12 months. The company has made progress in reducing its off-balance-sheet liabilities, such as guarantees and account receivables," said Standard & Poor's credit analyst Stanley Chan. "Our base case factors in Zoomlion's clear plan to refinance its foreign currency debt with onshore bonds that have lower interest cost." However, S&P sees risks to its base case from Zoomlion's short weighted average debt maturity profile, at less than two years as of end-2015. In addition, liquidity pressure may escalate if the currently favorable onshore credit conditions quickly or significantly change. Zoomlion's profitability should mildly recover in 2016 and 2017 from historical lows in 2015. However, the increase won't be sufficient to significantly reduce the company's leverage. Sluggish demand in China's construction machinery market caused the company's operating scale and profitability to decline substantially in 2012-2015. S&P estimates Zoomlion's debt-to-EBITDA ratio to be a high 17.7x in 2016, albeit declining from 19.9x in 2014, after factoring in the off-balance-sheet liabilities. The company's overall exposure to contingent liabilities includes guarantees to banks and others. S&P estimates these liabilities will decline to Chinese renminbi (RMB) 8 billion-RMB9 billion in 2016, from RMB10.27 billion in 2015 and RMB17.26 billion in 2014. Zoomlion was no longer engaged in factoring its account receivables to banks for cash in 2015. S&P expects the mildly positive momentum in Zoomlion's operating cash flows starting in second-half 2015 to continue in 2016. The company has been executing tight credit underwriting standards. S&P estimates that Zoomlion will generate positive operating cash flows of RMB2 billion-RMB2.5 billion in 2016. However, S&P believes the company may still face some challenges in execution as the market remains weak. In S&P's base-case scenario, it expects Zoomlion to benefit from business diversification after its recent acquisitions of Chery Heavy Industries and its machinery business, and Ladurner Ambiente and its environment protection related business. Zoomlion will likely continue to control its business costs, with a focus on controlling its selling, general, and administrative (SG&A) expenses. S&P estimates the company's gross margin will stabilize at around 30% in the coming 24 months. Zoomlion's EBITDA margin could improve to 9%-11% during this time, from 8.3% in 2015. Despite the recent improvement in working hours for certain construction machinery, S&P remains cautious on China's construction machinery sector and see no clear sign of a sector turnaround yet. S&P believes the excessive inventory in the property market and supply-side reforms will reduce overcapacity. The ongoing reforms will continue to pressure demand in the construction machinery sector over the coming 12 months. S&P expects industry consolidation to take place, and the large market players will likely seize market share from small players in the medium to long term. S&P projects Zoomlion's total revenue to increase 3%-5% to RMB21 billion in 2016. S&P believes the major driver for business growth will come from the agricultural and environmental business. S&P expects the revenue contributions from concrete and crane machinery to continue to decline to 7%-12%. S&P estimates the contribution from environmental and sanitation machinery to grow 15%-20% during the year. In addition, S&P forecasts the agricultural business to grow at above 15% in 2016, with revenues reaching RMB4.3 billion in 2016. S&P estimates the percentage of revenue generated from agricultural and environmental protection business to increase to 43% by 2016. S&P anticipates the Chinese government's "one belt, one road" development strategy will have limited earnings impact on Zoomlion in the coming two years. The majority of the company's overseas clients are based in developing countries. S&P expects Zoomlion to lose its price advantage to domestic players in the developing countries due to the currency devaluation of local currency against Chinese yuan. Zoomlion has made provisions on bad and doubtful account receivables, which accounted for 7.41% of the total account receivables in 2015, from 5.52% in 2014. S&P projects the ratio may increase further in 2016 as the amount of receivables exceeding one year has increased over time and the level of provisioning is lower than peers'. In addition, 47.63% of the receivables under finance leases are classified as past due in 2016, from 30% in 2015. In S&P's view, the asset quality of the tradition business, which the company engaged in aggressive credit sales before 2013, may deteriorate further but at a slower pace. S&P believes the company has been prudently managing its business starting from 2014, and should partially offset the pressure on working capital. In S&P's view, Zoomlion has stronger technology capability with a well-diversified business across the construction, agricultural, and environment related machinery segments compared with international peers of similar scale. In addition, Zoomlion has shown resilient profitability during industry downturns. As of end-2015, policy bank borrowings account for a sizable proportion of company's total borrowings. Therefore, S&P applies a positive score to Zoomlion in S&P's comparable rating analysis. The negative outlook reflects S&P's expectation that Zoomlion's leverage will improve mildly but remain very high over the next 12 months. S&P forecasts the company's debt-to-EBITDA ratio to stay high at more than 10x in the coming 12 months but with an improving trend, benefitting from improving product mix, working capital management and capex control. Also, the company's large short-term maturities are vulnerable to a sudden change in the currently favorable onshore credit conditions. S&P may lower the rating if Zoomlion's funding and liquidity pressure escalates further and the debt maturity profile deteriorates. This could happen due to: (1) weaker-than-expected working capital management and profitability; (2) more aggressive debt-funded acquisitions; or (3) the weighted average debt maturity profile remaining less than two years. S&P may also downgrade the company if its EBITDA interest coverage ratio falls substantially below 1.2x. Although not explicitly factored into the current rating, any large debt-funded acquisitions could weaken S&P's current expectation for debt servicing and liquidity position. S&P may revise the outlook to stable if Zoomlion's liquidity and funding improves, while the company lengthens its debt maturity profile and reduces its off-balance-sheet exposure on a sustained basis. This could happen if Zoomlion: (1) generates positive operating cash flows for early debt prepayment; (2) improves its capital structure and lengthens its weighted average debt maturity debt to substantially more than two years; and (3) continues to reduce its off-balance-sheet liabilities and manage its on balance sheet exposure. ========= I N D I A ========= A.N.R COTTON: ICRA Suspends B+ Rating on INR11.0cr Loan ------------------------------------------------------- ICRA has suspended [ICRA] B+ assigned to INR11.00 crore fund based limits and INR1.00 crore unallocated limits of A.N.R Cotton Traders. The suspension follows ICRA's inability to carry out a rating surveillance in the absence of the requisite information from the company. A.N.R Cotton Traders was set up in 2001 as a partnership firm in Guntur and managed by Mr. A.Gopala Krishna. The firm is involved in trading of Cotton Lint, Seed and Kappas. AGNI LIMITED: CRISIL Suspends B Rating on INR34.6MM Cash Loan ------------------------------------------------------------- CRISIL has suspended its ratings on the bank facilities of Agni Limited (AGL). Amount Facilities (INR Mln) Ratings ---------- --------- ------- Bank Guarantee 15 CRISIL A4 Cash Credit 34.6 CRISIL B/Stable Proposed Long Term Bank Loan Facility 8.4 CRISIL B/Stable Term Loan 12 CRISIL B/Stable The suspension of ratings is on account of non-cooperation by AGL with CRISIL's efforts to undertake a review of the ratings outstanding. Despite repeated requests by CRISIL, AGL is yet to provide adequate information to enable CRISIL to assess AGL'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 factor in its rating process as outlined in its criteria 'Information Availability - a key risk factor in credit ratings' AGL was originally incorporated in 2000 as a private limited company, Agni Constructions Pvt Ltd; this company was subsequently reconstituted as a public limited company with the current name in April 2012. AGL is promoted by Delhi-based Mr. C Agnihotri. It is a civil contractor, engaged in construction of buildings. AMBO EXPORTS: CRISIL Suspends D Rating on INR700MM Loan ------------------------------------------------------- CRISIL has suspended its rating on the bank facilities of Ambo Exports Industries Limited (AEL; formerly known as Ambo Exports Ltd). Amount Facilities (INR Mln) Ratings ---------- --------- ------- Bank Guarantee 100 CRISIL D Foreign Bill Discounting 700 CRISIL D Letter of Credit 50 CRISIL D Proposed Short Term Bank Loan Facility 50 CRISIL D The suspension of ratings is on account of non-cooperation by AEL with CRISIL's efforts to undertake a review of the ratings outstanding. Despite repeated requests by CRISIL, AEL is yet to provide adequate information to enable CRISIL to assess AEL'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 factor in its rating process as outlined in its criteria 'Information Availability - a key risk factor in credit ratings' AEL commenced operations in 1992 and exports commodities such as tea, oil, rice, dal, and biscuits. It is promoted by Mr. O P Agarwal (based in Kolkata) and his family. AMIT ENGINEERS: ICRA Assigns 'B+' Rating to INR4.10cr Loan ---------------------------------------------------------- ICRA has assigned its long term rating of [ICRA]B+ to the INR4.60 Crore bank lines of Amit Engineers. ICRA has also assigned the short term rating of [ICRA]A4 to the INR1.70 crore short term bank facilities of the firm. Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long-term fund- based bank facilities 4.10 [ICRA]B+ assigned Long-term non fund-based bank facilities 0.50 [ICRA]B+; assigned Short-term-Non fund based facilities 1.70 [ICRA]A4; assigned ICRA's ratings take into account the small scale of firm's operations as well as its limited bargaining power as reflected in moderate margins and high working capital intensive operations. Further major supplies of the firm are to Indian railways wherein realizations are relatively slow. The ratings however derive comfort from the significant experience (more than two decades) of promoters, in the manufacturing of air conditioning and refrigeration products for Indian Railways, low counterparty default risk and relationships with other corporate like BEML. The order book of the firm provides visibility in revenues going forward. ICRA also takes note of the constitution of the firm as sole-proprietorship wherein there is risk of withdrawal of capital. Going forward, the firm's ability to improve in margins, increase scale of operations while optimizing its working capital cycle, will be the key rating sensitivities. Firm Profile Amit Engineers was established in 1986 and is into manufacturing of Air Conditioning and Refrigeration products for Indian Railways and is supplying fully integrated Air Conditioner to the Indian Railways since 2001. The company is an ISO 9001:2008 certified Company having their unit located in Chandigarh. Recent Results The company, on a provisional basiswhy on provisional basis for FY15, reported an Operating Income (OI) of INR11.30 crore and a Profit after Tax (PAT) of INR0.11 crore in FY15, as compared to an OI of INR9.09 crore and a PAT of INR0.09 crore in FY14. ANKIT INTERNATIONAL: ICRA Assigns 'B' Rating to INR35cr Loan ------------------------------------------------------------ ICRA has assigned a long term rating of [ICRA]B to the INR35.00 crore (enhanced from INR25.00 crore) of fund based bank facility of Ankit International. ICRA has also assigned a short term rating of [ICRA]A4 to the INR35.00 crore (enhanced from INR25.00 crore)2 non-fund based bank facility(Sub-limit of Short term Non- Fund Based Limit) of the firm. Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long Term Fund based Limit 35.00 [ICRA]B Assigned Short term Non Fund Based Limit 35.00 [ICRA]A4 Assigned The assigned ratings of Ankit International is constrained by its low profitability as a result of limited value addition in the trading business and pricing pressure from presence in the intensely competitive, unorganized and fragmented metals and metal scrap trading business. The ratings are further constrained by the relatively high working capital intensity resulting from inventory stocking practice on account of a wide product profile and relatively high debtor days which renders high reliance on external working capital borrowings. Inventory holding also renders exposure to price volatility of the trading products, the prices of which are commoditized in nature. The ratings are also constrained by the leveraged capital structure marked by high debt levels given the corresponding low net worth level and vulnerability of the same to withdrawals by the proprietor. However, the ratings favorably take into account the long experience of the promoters in scrap trading business and support of the group companies operating in the same line of business. Ankit International (AI) is a proprietorship firm, mainly engaged in import and trading of ferrous and non-ferrous metals, scrap and pipes. It procures goods mainly from China through direct import. It also imports from USA, UK and Estonia. There has been a major purchase from the domestic market as well. Sales region is mainly spread across the markets of Maharashtra, Gujarat and Haryana. Recent Results For the eleven months ending February 29, 2016, AI registered a net profit of INR0.27 crore on an operating income of INR71.51 crore (provisional numbers). AUSTIN DISTRIBUTORS: CRISIL Suspends B- Rating on INR273.5MM Loan ----------------------------------------------------------------- CRISIL has suspended its rating on the bank facilities of Austin Distributors Private Limited (ADPL). Amount Facilities (INR Mln) Ratings ---------- --------- ------- Cash Credit 80 CRISIL B-/Stable Term Loan 273.5 CRISIL B-/Stable The suspension of rating is on account of non-cooperation by ADPL with CRISIL's efforts to undertake a review of the ratings outstanding. Despite repeated requests by CRISIL, ADPL is yet to provide adequate information to enable CRISIL to assess ADPL'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 factor in its rating process as outlined in its criteria 'Information Availability - a key risk factor in credit ratings' ADPL was set up in 1938 in Kolkata (West Bengal) by British citizens. The company was acquaired by Mr. R P Patodia in 1970. Currently, it is managed by Mr. Sanjay Patodia, who is the managing director. ADPL has dealership of passenger cars of HMIL (since March 2011), and MM (since 2004); and two-wheelers of EML (since 1970). B.R. GUAR: ICRA Reaffirms B+ Rating on INR5.50cr Cash Loan ---------------------------------------------------------- ICRA has reaffirmed its rating of [ICRA]B+ on the INR5.50 crore cash credit facility and the Rs.1 crore term loan of B.R. Guar Gum Private Limited. ICRA has also reaffirmed its rating of [ICRA]B+/[ICRA]A4 on the INR0.50 crore unallocated limit of BRGGPL. Amount Facilities (INR crore) Ratings ---------- ----------- ------- Cash Credit 5.50 [ICRA]B+; reaffirmed Term Loan 1.00 [ICRA]B+; reaffirmed Unallocated 0.50 [ICRA]B+/[ICRA]A4; reaffirmed The ratings reaffirmation factors in the decline in revenues as well as profitability during the current year (YTD 2015-16) which is attributable to the dip in demand of guar gum powder from North America's oil and drilling sector, which is the major end user segment for Indian guar gum powder manufacturers, leading to crash in prices of guar gum over the last one year. The ratings continue to be constrained by the high fragmentation and high competitive intensity in the guar split manufacturing business resulting in thin profitability and the vulnerability of the company's profitability to adverse fluctuations in the guar seed prices, as seasonality and crop harvest impact guar seed production. The ratings, however, favourably factor in the location advantage of the company's manufacturing facility in terms of proximity to the main guar seed growing region in Rajasthan. Going forward, the ability of the company to increase its scale of operations while maintaining moderate gearing level and debt coverage indicators remain the key rating sensitivities. Incorporated in April 2011, BRGGPL commenced commercial operations in November 2011. The company is engaged in the manufacturing of guar gum splits at its unit located in Siwani Mandi in Haryana. The current seed processing capacity of the company is 1400 quintals per day. The company sells its product in the domestic market through a network of brokers who, in turn, sell to merchant exporters for use in oil & gas and food sector. As per its audited financials for 2014-15, BRGGL recorded a net profit of INR0.17 crore on an operating income of INR113.01 crore as against a net profit of INR0.15 crore on an operating income of INR98.60 crore in 2013-14. B.S. AGRICULTURE: ICRA Assigns B/A4 Rating to INR5.50cr Loan ------------------------------------------------------------ ICRA has assigned its long term rating of [ICRA]B and short term rating of [ICRA]A4 to the INR5.50 crore fund-based bank limits and INR1.50 crore non fund-based bank limits of B.S. Agriculture Industries (India). Amount Facilities (INR crore) Ratings ---------- ----------- ------- Fund based Limit 5.50 [ICRA]B/A4; assigned Non Fund based Limit 1.50 [ICRA]B/A4; assigned ICRA's rating is constrained by the vulnerability of BSAI's margins to raw material price fluctuations and the high competitive intensity of the industry given the low entry barriers. The ratings also factor in the modest scale of operations of the firm and its weak financial risk profile characterized by low net worth and high leverage (Gearing of 4.41x and Debt/OPBDITA3 of 3.7x as on March 31, 2015). The rating is further constrained by the vulnerability of the firm's profitability to adverse movements in exchange rates and inherent risks associated with the partnership constitution of the firm like withdrawal of capital, risk of dissolution etc. However, the rating draws comfort from the long experience of the promoters in the manufacturing of pump sets and diesel engines. The rating also favorably factors in BSAI's geographic revenue diversity as well as its moderate working capital cycle (NWC/OI4 of 7% in FY15) which has kept BSAI's funding requirements low. The ability of the firm to achieve sustained and profitable growth in operating income and improve its leverage will be the key rating sensitivities. BSAI, incorporated in 1968 by Mr. Baldev Singh Matharoo manufactures pump sets, diesel engines, centrifugal water pumps, generating sets and other agricultural equipment. The firm has manufacturing units in Ludhiana (Punjab) and Agra (Uttar Pradesh) and also one branch office in Patna (Bihar). Exports are made through the Ludhiana unit to Egypt, Bangladesh, Australia, South Africa etc. while domestic sales are catered to by the Agra unit. Recent Results For FY2015, the firm reported a net profit of INR0.79 crore on an operating income of INR31.9 crore, as compared to a net profit of INR0.68 crore on an operating income of INR28.6 crore for the previous year. The firm, on a provisional basis, reported an operating income of ~INR38 crore for FY2016. BHALARA COTTON: ICRA Reaffirms 'B' Rating on INR17cr LT Loan ------------------------------------------------------------ ICRA has reaffirmed the [ICRA]B rating to the INR17.00 crore fund based cash credit facilities of Bhalara Cotton Private Limited. ICRA has also reaffirmed the [ICRA]B rating to the INR5.00 crore long term fund based proposed limits of BCPL. Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long Term Fund based Cash Credit 17.00 [ICRA]B reaffirmed Long Term Fund based-Proposed Limits 5.00 [ICRA]B reaffirmed The reaffirmation of rating continues to reflect company's weak financial profile as reflected by low profitability, adverse capital structure, and weak debt coverage indicators. The ratings also take into account the low value additive nature of operations and intense competition on account of fragmented industry structure leading to thin profit margins and vulnerability of profitability to adverse fluctuations in raw material prices which are subject to seasonal availability of raw cotton and government regulations on MSP for procurement of raw cotton. The ratings however, positively factors in the long experience of the promoters in the cotton ginning and pressing business and favorable location of the plant giving it easy access to raw cotton. Incorporated in 2005, Bhalara Cotton Private Limited is promoted by Mr. Bipin Ranpariya and Mr. Jitendra Bhalara along with other shareholders. The company is engaged in the business of ginning and pressing of raw cotton with installed manufacturing capacity of around 250 bales per day. Recent Results For the year ended 31st March 2015, Bhalara Cotton Private Limited has reported an operating income of INR128.05 crore and profit after tax of INR0.23 crore as per audited results. BORSE BROTHERS: CRISIL Cuts Rating on INR93.7MM Loan to B- ---------------------------------------------------------- CRISIL has downgraded its rating on the long-term bank facilities of Borse Brothers Engineers & Contractors Private Limited (BBEC) to 'CRISIL B-/Stable' from CRISIL B/Stable, while reaffirming its rating on the short-term facility at 'CRISIL A4'. Amount Facilities (INR Mln) Ratings ---------- --------- ------- Bank Guarantee 25 CRISIL A4 (Reaffirmed) Cash Credit 20 CRISIL B-/Stable (Downgraded from 'CRISIL B/Stable') Proposed Long Term 31.3 CRISIL B-/Stable (Downgraded Bank Loan Facility from 'CRISIL B/Stable') Term Loan 93.7 CRISIL B-/Stable (Downgraded from 'CRISIL B/Stable') The rating downgrade reflects pressure on liquidity due to stretched working capital cycle. Working capital requirement is large because of high gross current assets of 567 days as on March 31, 2015. This is mainly due to sizeable inventory (304 days) and slow construction in ongoing build-operate-lease- transfer (BOLT) projects. Hence the working capital limits was utilised at an average of 95 percent over the 12 months ended October 2015, with instances of full utilisation. Further the term loan availed to fund BOLT projects has also weakened the capital structure. Gearing is expected to increase to above 2 times as on March 31, 2016, from 1.23 times in the previous year. Working capital management will remain a key rating sensitive factor over the medium term. The ratings reflect BBEC's small scale of, and working capital- intensive, operations in the fragmented and tender-driven civil construction industry, weak financial risk profile because of small net worth, high gearing, and low cash accrual, and exposure to risks related to BOLT projects. These weaknesses are partially offset by promoters' extensive experience and healthy order book. Outlook: Stable CRISIL believes BBEC will continue to benefit over the medium term from promoters' extensive experience. The outlook may be revised to 'Positive' in case of substantial improvement in scale of operations and efficient working capital management, while maintaining profitability and capital structure. Conversely, the outlook may be revised to 'Negative' in case of pressure on financial risk profile, particularly liquidity, because of low cash accrual or large working capital requirement in the absence of funding from promoters. Incorporated in April 2010, BBEC constructs roads and buildings, and also undertakes irrigation projects for Central and state government agencies. Business was earlier carried out under proprietorship firm, Borse Brothers Engineers and Contractors, established in 1986. CHALLANI RANKA: ICRA Suspends B+ Rating on INR10cr Bank Loan ------------------------------------------------------------ ICRA has suspended [ICRA]B+ ratings assigned to the INR10.00 crore bank lines of Challani Ranka Jewellery. The suspension follows ICRA's inability to carry out a rating surveillance in the absence of the requisite information from the company. COMPETENT DYESTUFF: ICRA Suspends B Rating on INR10cr Loan ---------------------------------------------------------- ICRA has suspended the [ICRA]B rating assigned to the INR10.0 crore bank lines of Competent Dyestuff & Allied Products Private Ltd. The suspension follows ICRA's inability to carry out a rating surveillance in the absence of the requisite information from the company. CDAPPL was incorporated in 1990. The company is engaged in trading of fluorine-based chemicals. The company is distributor of fluorine-based chemicals for the Aditya Birla Group (Tanfac Industries Ltd), the Mafatlal Group (Navin Fluorine International Limited) and SRF Limited. CDAPPL primarily caters to the requirements of steel and glass industries. The company also trades in fabric. COOCH BEHAR: ICRA Reaffirms B- Rating on INR34.49cr Term Loan ------------------------------------------------------------- ICRA has re-affirmed the long term rating of [ICRA]B- to the INR34.49 crore term loans and INR0.51 crore unallocated limit of Cooch Behar Mission Hospital Private Limited. Amount Facilities (INR crore) Ratings ---------- ----------- ------- Fund Based Limit Term Loans 34.49 [ICRA]B- re-affirmed Unallocated Limit 0.51 [ICRA]B- re-affirmed The re-affirmation of the rating takes into account the company's exposure to project execution risks and funding risks, given a significant portion of the total capex and the proposed equity infusion are pending. The disbursement of the sanctioned term loan for the pending capex has not yet been started on account of the delay in infusion of the requisite equity capital, thereby affecting further progress of the capex programme. ICRA also notes that the company's cash flows continue to be encumbered by limited operational activities, with regulatory approval to run only 50 beds in the hospital at present, vis-a-vis the total proposed capacity of 136 beds, due to slow augmentation of medical infrastructure and other resources. The company also remains exposed to geographical concentration risks with presence in a single location, accentuated further by competition from other hospitals operating in the catchment area. Furthermore, recruitment and retention of good doctors by CBMH would remain a key challenge. However, ICRA takes note of the favourable demand outlook of the healthcare industry in the long term, and long experience of one of the promoters as a doctor, which is likely to mitigate operational risks to an extent, going forward. CBMH's ability to conclude the project without any further significant time and cost overrun, and attain the expected occupancy level subsequently, would remain key rating sensitivities. Established in 2007, CBMH is currently in the process of setting up a 136 bedded multi-specialty hospital and nursing college in Cooch Behar, West Bengal. One of the promoters of the company, Dr. Nirmal Palit, possesses a long experience as a doctor. CBMH commenced commercial operation with the initial regulatory approval obtained in November 2014, for running 20 beds. In January 2016, the hospital has obtained approval for additional 30 beds, and is running 50 beds currently. Nevertheless, a significant portion of the proposed infrastructure of the hospital is yet to be built up. Recent Results CBMH reported a net loss of INR0.24 crore on an operating income of INR1.95 crore in FY2015. It had an operation of five months (November 2014 - March 2015) during the year. CYBERWALK TECH: ICRA Reaffirms 'D' Rating on INR68.84cr Loan ------------------------------------------------------------ ICRA has reaffirmed the long term rating of [ICRA]D for INR68.84 crore1 term loans of Cyberwalk Tech Park Private Limited. Amount Facilities (INR crore) Ratings ---------- ----------- ------- Term Loan 68.84 [ICRA]D reaffirmed The rating action factors in the delays in servicing of debt by CTPPL in light of absence of adequate cash flow generation due to subdued incremental sales/leasing activity in its project. Given the oversupply situation in the vicinity of the project, CTPPL remains exposed to considerable market risk. ICRA has also taken note of restructuring of CTPPL's debt, resulting in deferment of principal and its interest repayment liability till January 2017. Till such date, the company is only required to service the interest on the funded interest term loan. The rating however takes into consideration the company's majority shareholder - Aarone Group's long experience in the industry and continued funding support extended by the promoters towards the project. Going forward, timely servicing of debt repayment commitments and CTPPL's ability to lease/sell the remaining area at desired prices and maintain its collection efficiency will remain the key rating sensitivities. Cyberwalk Tech Park Private Limited (Sofed Retailer Private Limited) was taken over by Mr. Amit Kumar Modi and Parabolic Real Estate Private Limited (jointly promoted as a Special Purpose Vehicle by Mr. Pranav Gupta and Mr.Vineet Gupta) to set up an IT Park at Manesar, Gurgaon. Thereafter, Aarone Promoters Private Limited (a group company of Aarone Group) was included in the management of CTPPL in the capacity of a real estate developer. Presently Aarone Promoters Private Limited is the largest shareholder with 44.20% stake followed by Mr.Amit Kumar Modi and Parabolic Real Estate Private Limited at 27.9% each. The IT Park is titled 'Cyber Walk' and is being developed in two phases, with a total leasable/saleable area of 11.28 lakh sq.ft; with 8.8 lakh sq.ft to be developed in phase one. DEV BHOOMI: ICRA Assigns 'B' Rating to INR6.0cr Term Loan --------------------------------------------------------- ICRA has assigned its long-term rating of [ICRA]B to the INR6.0 crore term loans and INR2.5 crore working capital facility of Dev Bhoomi Frozen Food Products. Amount Facilities (INR crore) Ratings ---------- ----------- ------- Term Loan 6.0 [ICRA]B; assigned Working Capital 2.5 [ICRA]B; assigned ICRA's rating takes into account the highly competitive nature of the industry in which DBFF operates, characterized by a few larger players and a number of small players, coupled with the firm's limited track record of operations. The rating is also constrained by the vulnerability of the firm's profitability to agro climatic risks as raw material availability and prices are dependent on weather conditions. The rating also factors in the firm's elongated working capital cycle on account of high inventory levels and its below average coverage indicators. ICRA also takes note of the partnership constitution of the firm which exposes it to risks of withdrawal, dissolution etc. However, the rating derives comfort from the experience of the firm's management in a similar line of business and increasing demand for frozen fruits and vegetables in the domestic market. ICRA also takes note of the favourable location of the processing facility, in close proximity to fruit and vegetable growing areas. Going forward, the firm's ability to ramp up its scale of operations while bringing about a sustained improvement in its working capital cycle and profitability will be the key rating sensitivities. Established in 2014, DBFF is engaged in the processing of fruits and vegetables through Individual Quick Freezing (IQF) technology for preservation. Its day-to-day operations are looked after by Mr Yogesh Jain and Mr Vinesh Jain, having profit sharing of 50% each. Both the partners were earlier engaged in trading of frozen vegetables and fruits, and packaged food. The firm has a production capacity of 5,300 Metric Tonnes Per Annum (MTPA) at its unit located at Kashipur (Uttarakhand). The major products that can be processed by the firm include green peas, cauliflower, bean, carrot, okra, litchi, mango and corn; the firm proposes to source these from adjoining areas of Udham Singh Nagar and Nainital located in Uttarakhand. However, the firm is processing green peas in its initial period of operations. Recent Results The firm achieved an operating income of INR0.45 crore on which it incurred a net loss of INR0.55 crore in 2M FY2015. EMERALD INDUSTRIES: ICRA Suspends B-/A4 Rating on INR14.80cr Loan ----------------------------------------------------------------- ICRA has suspended the [ICRA] B-/ [ICRA] A4 assigned to the INR14.80 crore long term bank facilities of Emerald Industries The suspension follows ICRA's inability to carry out a rating surveillance in the absence of the requisite information from the company. According to its suspension policy, ICRA may suspend any rating outstanding if in its opinion there is insufficient information to assess such rating during the surveillance exercise. FILTER MANUFACTURING: CRISIL Suspends D Rating on INR35MM Loan -------------------------------------------------------------- CRISIL has suspended its ratings on the bank facilities of Filter Manufacturing Industries Private Limited (FMIPL). Amount Facilities (INR Mln) Ratings ---------- --------- ------- Bank Guarantee 30 CRISIL D Cash Credit 35 CRISIL D Letter of Credit 10 CRISIL D Proposed Long Term Bank Loan Facility 18 CRISIL D Standby Line of Credit 3 CRISIL D The suspension of ratings is on account of non-cooperation by FMIPL with CRISIL's efforts to undertake a review of the ratings outstanding. Despite repeated requests by CRISIL, FMIPL is yet to provide adequate information to enable CRISIL to assess FMIPL'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 factor in its rating process as outlined in its criteria 'Information Availability - a key risk factor in credit ratings' Incorporated in 1990, FMIPL designs and erects industrial filters and APC systems for railways, and steel, fertilisers, and power industries. The company also undertakes fabrication of sheet metal, and manufactures and trades in medical disposables. FMIPL is managed by Mr. Pritish Basu. GANTA SRIRAM: ICRA Assigns B+ Rating to INR5.90cr LT Loan --------------------------------------------------------- ICRA has assigned the long-term rating of [ICRA]B+ to INR5.90 crore fund based bank facilities and INR4.10 crore unallocated limits of Ganta Sriram Educational Society. Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long term fund based 5.90 [ICRA]B+; Assigned Long term Unallocated 4.10 [ICRA]B+; Assigned The assigned ratings are constrained by the small scale of operations of GSES, the challenges involved in attracting high quality of students and faculty amidst high competition in the industry, and regulated nature of the higher education industry where any adverse regulation could impact revenue growth and profitability. Further ratings are subdued by the low placement percentage in the past. ICRA also notes that, with Government of Andhra Pradesh accounting for majority of the receivables of the society, any delays in payments would stretch the liquidity position. However the assigned rating favourably factors in the track record of society members of GSES. Further rating also positively factors in the healthy occupancy ratio at under graduate courses offered by the institute in the past few years. Going forward, the ability of the institute to improve its scale of operations, maintain healthy occupancy ratio and effectively manage working capital requirements with timely receipt of fees from government would be key rating issues. Ganta Sriram Educational Society was established in 2007. The society runs "Ramachandra College of Engineering" in Eluru, West Godavari district of Andhra Pradesh. The college is affiliated to Jawaharlal Nehru Technological University, Kakinada. Mr. GS Ramachadra Rao is the current Chairman of the society. The college offers courses under 5 different streams in under graduate Engineering, 3 courses under Post Graduation course and M.B.A course. The college has ~2300 students pursuing various courses for AY2015-16. Recent Result GSES registered INR11.16 Crore of receipts and a net surplus of INR3.52 Crore in FY15 as against Gross receipts of INR7.34 Crore and a net surplus of INR0.89 Crore in FY14. GROWTHPATH SOLUTIONS: CRISIL Assigns 'B' Rating to INR60MM Loan --------------------------------------------------------------- CRISIL has assigned its 'CRISIL B/Stable' rating to the long-term bank facility of Growthpath Solutions Private Limited (GSPL). The rating reflects the small scale of operations in a fragmented industry and low operating profitability. These rating weaknesses are partially offset by the moderate financial risk profile because of comfortable gearing and funding support from promoters. Amount Facilities (INR Mln) Ratings ---------- --------- ------- Cash Credit 60 CRISIL B/Stable Outlook: Stable CRISIL believes GSPL will continue to benefit over the medium term from the promoters' extensive industry experience. The outlook may be revised to 'Positive' in case of a significant increase in the scale of operations and profitability, along with improvement in the working capital cycle. Conversely, the outlook may be revised to 'Negative' if larger-than-expected debt-funded capital expenditure or less-than-expected cash accrual weakens the capital structure. Incorporated in 2010 by the Delhi-based Jain family, GSPL is promoted by Mr. Atul Jain and his wife Ms. Poonam Jain. The company trades in flour, bakery products, olive oil, and other fast-moving consumer goods. Mr. Atul Jain manages the operations. GSPL reported a net profit of INR0.56 million on sales of INR272.66 million for 2014-15 (refers to financial year, April 1 to March 31), as against a net profit and sales of INR0.41 million and INR175.1 million, respectively, for 2013-14. HINDUSTAN WINDOWS: Ind-Ra Suspends IND B- Long-Term Issuer Rating ----------------------------------------------------------------- India Ratings and Research (Ind-Ra) has migrated Hindustan Windows Mfg Co's (HWMC) 'IND B-' Long-Term Issuer Rating to the suspended category. The Outlook was Stable. This rating will now appear as 'IND B-(suspended)' on the agency's website. A full list of rating actions is at the end of this commentary. The ratings have been migrated to the suspended category due to lack of adequate information. Ind-Ra will no longer provide ratings or analytical coverage for HWMC. The ratings 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 the six-month period, the ratings could be reinstated and will be communicated through a rating action commentary. HWMC's ratings: -- Long-Term Issuer Rating: migrated to 'IND B-(suspended)' from 'IND B-'/Stable -- INR65 million fund-based working capital limits: migrated to 'IND B-(suspended)' from 'IND B-' -- INR40 million non-fund-based working capital: migrated to 'IND A4 (suspended)' from 'IND A4' ICA EDU: Ind-Ra Assigns 'IND BB' Long-Term Issuer Rating -------------------------------------------------------- India Ratings and Research (Ind-Ra) has assigned ICA Edu Skills Pvt. Limited (ICA) a Long-Term Issuer Rating of 'IND BB'. The Outlook is Stable. The agency has also assigned ICA's INR50.0 million non-fund-based working capital limits a Long-term 'IND BB' rating with a Stable Outlook and a Short-term 'IND A4+' rating. KEY RATING DRIVERS The ratings reflect ICA's moderate revenue base and credit metrics. In FY15, revenue was INR391.36m (FY14: INR317.95m), net financial leverage (total adjusted net debt/operating EBITDA) was negative at 1.2x (FY14: 2.4x) and EBITDA interest coverage was 2.4x (4.3x). The ratings also reflect ICA's comfortable liquidity profile as indicated by its 85% average working capital utilisation during the 12 months ended February 2016. The ratings are supported by over 15 years of experience of ICA's promoters in running a computer training centre. RATING SENSITIVITIES Positive: A sustained improvement in the EBITDA interest coverage would lead to a positive rating action. Negative: A sustained decline in the EBITDA interest coverage would lead to a negative rating action. COMPANY PROFILE Kolkata-based ICA was incorporated in 1999. The company runs as a computer training centre. It is managed by Mr Narendra Kumar Shyamsukha and Mr Deepak Parmanik. JBJ TECHNOLOGIES: ICRA Reaffirms 'B' Rating on INR7.25cr Loan ------------------------------------------------------------- ICRA has reaffirmed its long-term rating of [ICRA]B and short term rating of [ICRA]A4 on the INR8.55 crore1, fund based and non fund based bank facilities of JBJ technologies Limited. Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long Term Fund- based bank facilities 7.25 [ICRA]B; reaffirmed Short Term Fund Based 0.55 [ICRA]A4; reaffirmed Short Term Non fund Based 0.75 [ICRA]A4; reaffirmed ICRA's ratings reaffirmation continues to take into JBJ's modest scale of operations, its tight liquidity owing to long cash conversion cycle and high debt repayment obligations in relation to cash accruals. The ratings continue to be constrained on account of low bargaining power with its suppliers and customers due to which JBJ makes payments to suppliers almost on immediate basis whereas payments are realized after providing credit period. The liquidity of the company remains tight due to long conversion cycle involved in developing and designing of the prototypes in the molding division leading to high inventory levels. The company relies largely on external borrowings for funding the working capital given the limited net worth base. This coupled with high term loan repayments lead to stretched liquidity position as reflected in near full utilization of its working capital facilities throughout the year. The assigned ratings plz update this also factor in its modest financial profile as indicated in high gearing and modest profitability margins resulting in modest debt protection metrics. Apart this, the rating also take into consideration the high client concentration risk with top two customers contributing ~46% of the total revenue in FY2015. The ratings, however favorably take into account JBJ's reputed clientele like SC Johnson and Kent Ro and its long association with them along with ability to generate repeat orders. Further, ICRA also factors in the long experience of promoters in the mould making and injection molding segments. Going forward, ability of the company to maintain revenue growth while improving its profitability and efficiently manage its working capital to improve its liquidity shall be the key rating sensitivities. Established in 1996, JBJ is a closely held company primarily involved into designing and manufacturing of high precision moulds and manufacturing of plastic moulds through injection molding. The company caters to highly reputed clients like SC Johnson, Kent Ro etc and manufactures outer body for the All Out brand (SC Johnsons) and Kent's Water purification system. Recent Results JBJ reported a net profit of INR0.40 crore on an operating income of INR35.72 crore in FY 2014-15, as against a net profit of INR0.19 crore on an operating income of INR30.86 crore in the previous year. KAILASH EDUCATIONAL: Ind-Ra Rates INR90MM Term Loan 'IND BB-' ------------------------------------------------------------- India Ratings and Research (Ind-Ra) has assigned Kailash Educational & Charitable Society's (KECS) INR90 million term loan facility a Long-term rating of 'IND BB-'. The Outlook is Stable. COMPANY PROFILE KECS has set up a school in collaboration with Delhi Public School Society (DPSS). KECS was established in 2004 under Societies Registration Act, 1860. DPS Sirsa is the first school of KECS and is in first year of operations. Basic infrastructure facilities were completed in March 2015 with capacity of around 1,200 students and Phase II construction work is in progress which will take the total capacity to around 2,000 students. KEY RATING DRIVERS The rating is constrained by KECS' current tight liquidity profile and high debt burden. Available funds/total long-term debt was 9.57% and debt/cash balance before interest & depreciation was negative 30.01x in FY15. The rating is supported by the likelihood of demand being high for the school because of the already established brand name Delhi Public School. The school started its operations in April 2015 and has 514 students in its first academic session (2015- 2016). Ind-Ra expects the debt/CBBID, debt service coverage ratio and interest service coverage ratio to become comfortable on back of stabilisation of operations and a sustained improvement in CBBID in coming years. Also, size of operations is likely to increase on back of growth in the total headcount. With over 150 institutions, DPSS has established a brand name Delhi Public School. The collaborations with DPSS reduces KECS' brand building efforts and allows it to concentrate on developing efficient and cost-effective operating systems and delivery mechanisms. RATING SENSITIVITIES Positive: Improvements in liquidity and a sustained improvement operating margins along with growth in total headcount could be positive for the rating. Negative: Any unexpected fall in student demand in conjunction with a disproportionate increase in debt in relation to operating income and delay in Phase-II construction could affect the rating. KALINGA FERRO: CRISIL Suspends D Rating on INR221MM Cash Loan ------------------------------------------------------------- CRISIL has suspended its ratings on the bank facilities of Kalinga Ferro Ispat Private Limited (KFIPL). Amount Facilities (INR Mln) Ratings ---------- --------- ------- Cash Credit 221 CRISIL D Letter of Credit 10 CRISIL D Term Loan 61.5 CRISIL D The suspension of ratings is on account of non-cooperation by KFIPL with CRISIL's efforts to undertake a review of the ratings outstanding. Despite repeated requests by CRISIL, KFIPL is yet to provide adequate information to enable CRISIL to assess KFIPL'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 factor in its rating process as outlined in its criteria 'Information Availability - a key risk factor in credit ratings' KFIPL was established in 2005; its corporate office is at Kolkata. The company manufactures and trades in ferrochrome. Its manufacturing unit is in Jajpur district (Odisha). KFIPL was acquired in 2010 by Mr. Giriraj Ratan Binani; it started commercial operations in July 2010 and has a capacity of 8052 tonnes per annum. KCRM FOODS: CRISIL Assigns 'B' Rating to INR45MM Cash Loan ---------------------------------------------------------- CRISIL has assigned its 'CRISIL B/Stable/CRISIL A4' ratings to the bank facilities of KCRM FOODS Cont:Kalyana Chakravarthi Rice Mill (KCRM). Amount Facilities (INR Mln) Ratings ---------- --------- ------- Bank Guarantee 15 CRISIL A4 Cash Credit 45 CRISIL B/Stable The rating reflects modest scale of operations in the intensely competitive rice milling industry, and the susceptibility of its profitability margins to changes in government regulations and paddy prices. The rating of the firm is also constrained on account of its below average financial risk profile marked by its modest net-worth, low gearing, and weak debt protection metrics. These rating weaknesses are partially offset by the benefits that KCRM derives from its promoters' extensive experience in the rice milling industry. Outlook: Stable CRISIL believes that KCRM will continue to 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 a substantial and sustained increase in the firm's scale of operations, or in case of sizeable capital additions from its partners. Conversely, the outlook may be revised to 'Negative' in case of a steep decline in the firm's revenues or profitability margins, or significant deterioration in its capital structure caused most likely by a large debt-funded capital expenditure or a stretch in its working capital cycle. KCRM, set up in 1999, KCRM is engaged in milling of non-basmati raw and parboiled rice. Its rice milling unit is located in Pedapally in Andhra Pradesh. The firm currently has 9 partners' and is managed by Mr. Valluri Venkata Rao and Mr.Surya Bhaskara Rao. KDM CLOTHING: Ind-Ra Affirms 'IND BB-' Long-Term Issuer Rating --------------------------------------------------------------- India Ratings and Research (Ind-Ra) has affirmed KDM Clothing Co.'s (KCC) Long-Term Issuer Rating at 'IND BB-'. The Outlook is Stable. KEY RATING DRIVERS The affirmation reflects KCC's continued small scale of operations and moderate credit metrics with revenue of INR207.35 million in FY15 (FY14: INR169.79 million), interest coverage (operating EBITDA/gross interest expense) of 2.10x (1.85x) and financial leverage (adjusted net debt/operating EBITDAR) of 2.43x (1.91x). The ratings are constrained by the continued deterioration in EBITDA margins to 7.21% in FY15 (FY14: 7.85%; FY13: 9.11%) due to increasing raw material prices and the partnership nature of the business. The ratings factor in KCC's comfortable liquidity with 60.77% working capital utilisation over the 10 months ended January 2016 and a net cash conversion cycle of 23 days in FY15 (FY14: 23 days; FY13: 70 days). RATING SENSITIVITIES Positive: Substantial growth in the revenue along with an improvement in the operating margins leading to an improvement in the credit metrics could lead to a positive rating action. Negative: A further decline in the operating profitability leading to deterioration in the credit metrics will be negative for the ratings. COMPANY PROFILE Established in 2007, KCC manufactures hosiery goods and sweaters and sells them both in India and overseas. The promoters of the firm have more than 20 years of experience in the same line of business. KCC's ratings: -- Long-Term Issuer Rating: affirmed at 'IND BB-'/Stable -- INR35 million fund-based limits (reduced from INR43.70 million): affirmed at 'IND BB-'/Stable/'IND A4+' -- INR20.003 million long-term loan (reduced from INR24.68 million): affirmed at 'IND BB-'/Stable KIRPA FOODS: ICRA Assigns 'B' Rating to INR22.50cr Loan ------------------------------------------------------- ICRA has assigned its long-term rating of [ICRA]B on the INR22.50 crore fund based facilities of Kirpa Foods. Amount Facilities (INR crore) Ratings ---------- ----------- ------- Fund Based Limits 22.50 [ICRA]B; Assigned ICRA's rating factors in the entity's nascent stage of operations with modest scale of operations, which coupled with the low value additive nature of business and high competition in the industry, has resulted in low profitability and weak debt coverage indicators. The rating also takes into account the working capital intensive nature of the rice milling business due to the need to maintain substantial inventories. Further, the initial capital expenditure and working capital requirements have been primarily funded through bank borrowings, leading to a highly leveraged capital structure. The rating is also constrained by agro climatic risks, which can affect the availability of paddy in adverse conditions. However, the rating is supported by the experience of the promoters in the rice industry, proximity of the mill to a major rice growing area which results in easy availability of paddy and stable demand outlook with rice being an important part of the staple Indian diet. Going forward, the ability of the firm to increase its scale of operations and sustain its profitability, while improving its capital structure and optimizing the working capital intensity will be the key rating sensitivities. Incorporated in 2014, KF is a partnership firm engaged in milling, processing and sorting of basmati rice. The firm also sells some quantities of non-basmati rice, although the proportion remains low. The concern has its plant at Fazilka (Punjab) with a milling capacity of 8 tonnes per hour. The commercial operations of the entity started from December 2014 onwards. Recent Results The concern reported a net profit of INR0.04 crore on an operating income of INR17.94 crore in 3M FY2015.Further, the entity, on a provisional basis, has achieved a sale of INR96.50 crore till mid of March 2016 for FY2016. KPR INDUSTRIES: ICRA Lowers Rating on INR337.54cr Loan to D ----------------------------------------------------------- ICRA has revised the long-term rating assigned to the INR337.54 crore term loans of KPR Industries (India) Limited from [ICRA]BB- to [ICRA]D. ICRA has also revised the ratings assigned to the INR157.46 crore unallocated limits of KPRIL from [ICRA]BB- /[ICRA]A4 to [ICRA]D. Amount Facilities (INR crore) Ratings ---------- ----------- ------- Fund Based Limit Term loans 337.54 [ICRA]D revised Unallocated Limits 157.46 [ICRA]D revised The revision in ratings primarily takes into account delays in interest servicing owing to delay in project completion on account of local disturbances, state agitations, and elections during the construction of caustic soda plant. As a result, the total estimated cost of the project increased to INR691.27 crore from INR570.10 crore primarily owing to higher IDC and the company has approached the bank for sanction of cost overruns which is pending currently with the lead bank. The ratings continue to be constrained by moderate project execution risk of caustic soda plant construction with around 85% of the revised project cost incurred as on November 2015 end; high project gearing of 1.45 times and funding risk given that pending cost overruns have to be sanctioned by bank, promoters yet to bring in INR34.15 crore of the equity towards project cost funding. The ratings are also constrained by cyclicality inherent in the caustic soda industry; competition from other established players in the caustic soda industry; and lack of captive power plant resulting in higher operational costs owing to power intensive nature of caustic soda manufacturing. However, the ratings positively factors in the execution of plant construction by reputed equipment suppliers including UDHE India (Private) Ltd for caustic soda; savings in logistic cost as the proposed plant is located close to Kakinada port with majority of raw materials being shipped; and high level of forward integration mitigating chlorine off-take risk which is the constraining factor for caustic soda plant capacity utilisations in India. Going forward, timely sanction of bank limits for cost overruns funding, execution of the project in a timely manner and early stabilisation of operations post COD are the key rating drivers from credit perspective. Incorporated in 2011, KPR Industries (India) Limited (KPRIL) is setting up a 210 tons per day (TPD) caustic soda plant along with chlorine derivative products such as chlorinated paraffin wax (30 TPD), stable bleaching powder (50 TPD), and mono chloro acetic acid (20 TPD) at Biccavolu, East Godavari district, Andhra Pradesh. The initial project cost was INR740.65 crore which was to be funded by equity of INR290.65 crore equity and term loan of INR450 crore. The project scope got revised downwards with deferment of caustic potash and sulphuric acid plant construction owing to prevailing adverse market scenario for these products resulting in project cost revision from INR740.65 crore to INR570.10 crore and to be funded by equity of INR232.56 and term loan of INR337.54 crore with revision in commercial operations date (COD) from November 2014 to May 2015. Due to delays in construction, the total project cost increased to INR691.27 crore and to be funded by term loan of INR409.28 crore and equity of INR281.99 crore. The plant COD is also revised to November 2016. MA MAHAMAYA: CRISIL Suspends B Rating on INR60MM Term Loan ---------------------------------------------------------- CRISIL has suspended its rating on the bank facilities of MA Mahamaya Rice Mill Private Limited (MMRMPL). Amount Facilities (INR Mln) Ratings ---------- --------- ------- Cash Credit 60 CRISIL B/Stable Term Loan 60 CRISIL B/Stable The suspension of rating is on account of non-cooperation by MMRMPL with CRISIL's efforts to undertake a review of the ratings outstanding. Despite repeated requests by CRISIL, MMRMPL is yet to provide adequate information to enable CRISIL to assess MMRMPL'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 factor in its rating process as outlined in its criteria 'Information Availability - a key risk factor in credit ratings' Incorporated in 2006, MMRMPL mills non-basmati parboiled rice. Its manufacturing facility is located in Madhyamgram (West Bengal). MMRMPL's day-to-day operations are looked after by its director, Mr. Sandip Hazra. The company markets its product under the brand, Mahamaya Bhog. MADHOOR BUILDWELL: CRISIL Reaffirms B+ Rating on INR204.5MM Loan ---------------------------------------------------------------- CRISIL's ratings on the bank facilities of Madhoor Buildwell Private Limited (Madhoor) continues to reflect high geographic concentration in Madhoor's revenue profile, below-average financial risk profile with modest net worth, moderate gearing, and adequate debt protection metrics. Amount Facilities (INR Mln) Ratings ---------- --------- ------- Cash Credit 204.5 CRISIL B+/Stable (Reaffirmed) Proposed Long Term Bank Loan Facility 190 CRISIL B+/Stable (Reaffirmed) Proposed Short Term Bank Loan Facility 5.5 CRISIL A4 (Reaffirmed) The operations of Madhoor are working capital intensive with large inventory to be carried for its real estate activities. The rating weaknesses are partially mitigated by the benefits that the company derives from the extensive experience of its promoters in the civil construction business as well as real estate activities. Madhoor also has moderate order-book position, which provides medium term revenue visibility. CRISIL had downgraded its ratings on the bank facilities of Madhoor to CRISIL B+/Stable/CRISIL A4 from 'CRISIL BB- /Stable/CRISIL A4+' on February 18, 2016. The rating downgrade reflected the stretch in the liquidity profile of the company due to elongation of working capital cycle. A change in the sponsor for some of its projects has resulted in an increased processing time for release of payments to Madhoor for completed work. Consequently, as on September 30, 2015, the company had receivables of about INR246 million outstanding for more than 6 months, which has increased from INR26 million as on March 31, 2015. The delay in release of payments has resulted in increased reliance on short term debt to meet incremental working capital requirements. Resultantly, Madhoor's fund-based working capital bank lines have remained fully utilized for the past six months through December 31, 2016. Recovery of these slow moving receivables will remain a key rating sensitivity factor over the medium term. Outlook: Stable CRISIL believes that Madhoor will benefit from its promoters' extensive industry experience and strong revenue visibility, over the medium term. The outlook may be revised to 'Positive' in case there is significant improvement in the company's revenue and profitability, while sustaining its working capital cycle and capital structure. Conversely, the outlook may be revised to 'Negative' in case of delay in any of Madhoor's projects or less than anticipated bookings in its real estate projects leads to a liquidity crunch. Madhoor is engaged in real estate development and has been undertaking civil construction activities in Nasik (Maharashtra) since 1994. The founder promoter and chairman, the Late Mr. Ratilal Shivdas Patel, was in the construction business for five decades. Now, the business is run by his three sons'Mr. Pradip Ratilal Patel, Mr. Arvind Ratilal Patel, and Mr. Chetan Ratilal Patel. MANGALA CASHEW: ICRA Assigns B+ Rating to INR10cr LT Loan --------------------------------------------------------- ICRA has assigned a long term rating of [ICRA]B+ to INR10.00 crore long term fund based facilities of Mangala Cashew Industries. Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long-Term Fund Based Limits (CC) 10.00 [ICRA]B+ assigned The assigned rating takes into account the high competitive intensity in the cashew industry, which limits the firm pricing flexibility, the weak operating margins owing to the low value addition nature of business, the susceptibility of revenues and margins to the volatility in material prices and exchange rates owing to its dependence on imports. The rating is also constrained by the weak capital structure following the capital withdrawal by the partners in 2014-15; however, the capital infusion during 2015-16 is expected to moderate the capital structure. The ratings also take into account the inherent risks associated with the partnership nature of business including the risk of capital withdrawal and limited ability to raise capital among others. The rating, however, positively factors in the long standing presence of the promoters in the cashew industry with more than 3 decades of experience and the significant scale up in operations of the firm in the recent years by undertaking trading of Raw Cashew Nuts (RCN) and kernels in addition to the job work business. Mangala Cashew Industries was established in the year 1985 as a job work unit for processing of raw cashew nuts (RCN) to cashew kernels for its sister concern Mangalore Cashew Industries. From the year 2012-13 onwards, the firm started trading in RCN and processed kernels, which currently accounts for about 99% of the firm's revenues. The firm is currently managed by Mr. Vaman Kamath and Mr. Vasudeva Kamath. MCI has its processing unit in Padavinangady, Mangalore with an installed capacity of 5 MT per day. Recent Results The firm reported a net profit of INR1.4 crore on an operating income of INR135.2 crore during the financial year 2014-15, as against a net profit of INR2.2 crore on an operating income of INR101.8 crore during 2013-14. MG WELL: ICRA Lowers Rating on INR4.0cr Loan to 'D' --------------------------------------------------- ICRA has revised the long term rating assigned to the INR3.86 crore1 (earlier INR5.07 crore) fund based bank facilities of MG Well Solutions Project International Private Limited from [ICRA]B to [ICRA]D. ICRA has also revised the short term rating from [ICRA]A4 to [ICRA]D to the INR4.00 crore non-fund based bank facilities of the company. The unallocated limits of INR1.21 crore has also been rated at [ICRA]D. Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long-term fund based facility (CC) 2.00 [ICRA]D downgraded Term Loan 1.86 [ICRA]D downgraded Short-term non- fund based facilities (BG) 4.00 [ICRA]D downgraded Unallocated limits 1.21 [ICRA]D assigned The ratings downgrade is on account of delays in debt servicing by MGW due to weakening of its liquidity profile arising from stretched receivables. ICRA also notes the company's small scale and limited scope of its operations. The ratings also take into account the susceptibility of revenues to forex fluctuations as well as the intense competition from other large players who dominate the field of cementing for oil and gas rigs. The ratings however favourably incorporate the established experience of the proprietor and key management personnel of the firm in the field of cementing of wells in oil and gas rigs. MG Well Solutions Project International Private Limited (MGW) was incorporated in 2005, by Mr. Ravinder Singh Bawa and other like- minded promoters who had significant experience in the field of designing and construction cementing units. The company commenced operations in 2009 and is engaged in providing cementing services for oil and gas rigs. MGW has its registered office in Jabalpur and a portable laboratory in Baroda. Recent Results As per its audited financials for FY 15, MGW recorded net loss of INR0.14 crore on an operating income of INR7.90 crore. MITTAL ALLOY: CRISIL Assigns 'B' Rating to INR33MM LT Loan ---------------------------------------------------------- CRISIL has assigned its 'CRISIL B/Stable' ratings to the long term bank facilities of Mittal Alloy Castings Company. (MACC). Amount Facilities (INR Mln) Ratings ---------- --------- ------- Cash Credit 20 CRISIL B/Stable Long Term Loan 33 CRISIL B/Stable The ratings reflect MAAC's exposure to risks related to the implementation and stabilisation of the firm's ongoing project in Raigarh (Chhattisgarh), exposure to intense competition in the Steel manufacturing industry. These rating weaknesses are partially offset by the benefits that the firm derives from its promoters' extensive industry experience over the medium term. Outlook: Stable CRISIL believes that MAAC will continue to benefit over the medium term from its promoters' extensive industry experience. The outlook may be revised to 'Positive' if MAAC generates more- than-expected revenues and profits, after stabilising its operations. Conversely, the outlook may be revised to 'Negative' in case the firm reports delay in the commissioning of its project because of unforeseen events, or its financial risk profile deteriorates because of additional, debt-funded capital expenditure. MAAC, incorporated in July 2015 is setting up a facility for manufacturing of Grinding Media Balls.Based out of Raigarh (Chhattisgarh), MAAC is promoted by Mr. Shri Deepak Agrawal and Shri Ramsharan Agrawal. MULCHAND FIBER: CRISIL Reaffirms B Rating on INR89.2MM Term Loan ---------------------------------------------------------------- CRISIL's rating on the long-term bank facilities of Mulchand Fiber Private Limited (MFPL; part of the Mulchand group) continues to reflect below-average financial risk profile, because of modest networth, high gearing and weak debt protection metrics. Amount Facilities (INR Mln) Ratings ---------- --------- ------- Cash Credit 40 CRISIL B/Stable (Reaffirmed) Term Loan 89.2 CRISIL B/Stable (Reaffirmed) The rating also factors in stretched liquidity amidst large working capital requirements, fully drawn bank limits and large debt obligation in MFPL. These rating weaknesses are mitigated by the promoters' extensive experience in the cotton industry and their funding support and moderate scale of operations of the group. To arrive at the rating, CRISIL has combined the business and financial risk profiles of MFPL and Mulchand Phulchand Krishi Udyog Pvt Ltd (MPKUPL). This is because both the companies, together referred to as the Mulchand group, are promoted by the same family, engaged in similar business activities and have business and financial interlinkages. Moreover, MPKUPL has 60 percent stake in MFPL with remaining held by promoters in individual capacity. Outlook: Stable CRISIL believes the Mulchand group will continue to benefit over the medium term, from its promoters' extensive industry experience. The outlook may be revised to 'Positive', if sizeable cash accrual on sustainable basis, supported by enhanced scale of operations and profitability or fund infusion by promoters improves liquidity. Conversely, the outlook may be revised to 'Negative', if financial risk profile and liquidity weaken, because of significantly low cash accrual or stretched working capital cycle. MFPL was founded by Mr. Ashok Phulchand Agrawal and Ms. Chaya Ashok Agrawal, in Jalna in 2012. The company undertakes cotton ginning, de-linting of cotton seeds and oil extraction. MPKUPL was incorporated in 2003 in Jalna by Mr. Ashok Agrawal and undertakes ginning of cotton. NARULA FOODS: CRISIL Suspends D Rating on INR196MM Cash Loan ------------------------------------------------------------ CRISIL has suspended its rating on the bank facilities of Narula Foods Private Limited (NFPL). Amount Facilities (INR Mln) Ratings ---------- --------- ------- Cash Credit 196 CRISIL D Term Loan 4 CRISIL D The suspension of rating is on account of non-cooperation by NFPL with CRISIL's efforts to undertake a review of the ratings outstanding. Despite repeated requests by CRISIL, NFPL is yet to provide adequate information to enable CRISIL to assess NFPL'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 factor in its rating process as outlined in its criteria 'Information Availability - a key risk factor in credit ratings' Incorporated in 1997, NFPL mills rice and extracts and refines rice bran oil. The company is promoted by Mr. Ashok Narula and Mr. Ravi Narula. Its manufacturing unit is in Guru Har Sahai (Punjab). PRECISE SEAMLESS: Ind-Ra Assigns 'IND BB' Long-Term Issuer Rating ---------------------------------------------------------------- India Ratings and Research (Ind-Ra) has assigned Precise Seamless Apparels Private Limited (PSAPL) a Long-Term Issuer Rating of 'IND BB'. The Outlook is Stable. A full list of rating actions is at the end of the commentary. KEY RATING DRIVERS The ratings reflect PSAPL's small scale of operations despite a substantial improvement in revenue in FY16; Interim financials for the April 2015-January 2016 period indicate revenue of INR661 million (FY15: INR535.67 million, FY14: INR442.25 million). The ratings also reflect PSAPL's weak credit metrics with net leverage (total Ind-Ra adjusted net debt/operating EBITDAR) of 4.08x in FY15 (FY14: 4.94x) and gross interest coverage (operating EBITDA/gross interest expense) of 2.08x (2.31x); the operating margins of the company are volatile and ranged between 12.43%-17.23% during FY12-FY15. The ratings are constrained by PSAPL's presence in the highly fragmented and intense competitive apparel industry and high customer concentration with around 90% of the revenue coming from the top two customers. The ratings, however, are supported by the company's moderately comfortable liquidity position as reflected by its 86.91% average utilisation of the working capital facilities for the 12 months ended March 2016 and the decade-long experience of its directors in the apparel industry. RATING SENSITIVITIES Negative: Deterioration in the profitability leading to sustained deterioration in the credit metrics will be negative for the ratings. Positive: A significant improvement in the revenue with the operating profitability being sustained and a subsequent improvement in the credit metrics will be positive for the ratings. COMPANY PROFILE PSAP is a private limited company incorporated in 2005. The company manufactures garments at its 400,000 pieces/month in Gurgaon, Haryana. It exports its entire production and has relationships with reputed brands such as GAP, Kohls, Abercrombie & Fitch. PSAPL's ratings: -- Long-Term Issuer Rating: assigned 'IND BB'; Outlook Stable -- INR130 million fund-based facilities: assigned 'IND BB'/Stable/'IND A4+' -- INR120 million term loan facilities: assigned 'IND BB'/Stable -- INR70 million non-fund-based facilities: assigned 'IND A4+' R.H. SORTEX: ICRA Assigns D Rating to INR5.62cr Loan ---------------------------------------------------- ICRA has assigned its [ICRA]D rating to INR5.62 crore fund based bank facilities of R.H. Sortex Rice Mills Private Limited. Amount Facilities (INR crore) Ratings ---------- ----------- ------- Fund Based limits 5.62 [ICRA ]D; assigned The assigned rating factors in delays in debt servicing by RHS on account of its stretched liquidity position. The company maintained high level of inventory (paddy) due to which the principal and interest obligation was not met on time. Further ICRA takes note of the decline in the turnover of RHS in the last two years on account of its presence in a highly competitive rice milling industry. RHS was established in 2011 as a private limited company. The company is primarily engaged in the milling of rice with an installed capacity of 8 Tons per hour in Gorakhpur District (U.P.). The company is professionally managed by Mr. Sukhdev Jaiswal. Recent Results The company reported a profit after tax (PAT) of INR0.15 crore on an operating income of INR16.06 crore for FY2015 as against PAT of INR0.12 crore on an operating income of INR19.68 crore in FY2014. Till January 31st 2016, the company reported, on a provisional basis, an operating income of INR9.16 crore. RAMALINGA REDDY: CRISIL Assigns B+ Rating to INR45MM LT Loan ------------------------------------------------------------ CRISIL has assigned its 'CRISIL B+/Stable' rating to the long- term bank facilities of Ramalinga Reddy (RR). Amount Facilities (INR Mln) Ratings ---------- --------- ------- Proposed Long Term Bank Loan Facility 34.1 CRISIL B+/Stable Lease Rental Discounting Loan 20.9 CRISIL B+/Stable Long Term Loan 45 CRISIL B+/Stable The rating reflects RR's exposure to implementation and demand risks associated with its ongoing commercial real estate project at Hosur Main Road Bommanahalli, Bengaluru, and its vulnerability to cyclicality inherent in the Indian real estate industry. These rating weaknesses are partially offset by the extensive experience of promoters in the real estate industry, and the strategic location of the project. Outlook: Stable CRISIL believes RR will continue to benefit over the medium term from the promoters' extensive industry experience. The outlook may be revised to 'Positive' if earlier-than-expected execution of its project and improved inflow of advances improve the liquidity. Conversely, the outlook may be revised to 'Negative' in case of a time or cost overrun in the project, or subdued response to the ongoing project, adversely affecting liquidity. Set up in 2010 as a proprietorship concern, RR is developing a commercial real estate project at Hosur Main Road Bommanahalli. The firm is promoted by Mr. Ramalinga Reddy and his family members. SEAGA INDIA: ICRA Reaffirms 'B+' Rating on INR8.0cr Term Loan ------------------------------------------------------------- ICRA has reaffirmed its rating of [ICRA]B+ on the INR13 crore fund based facilities of Seaga India Private Limited. ICRA has also reaffirmed its short-term rating of [ICRA]A4 on the INR2 crore (enhanced from INR1 crore) non-fund based limits of SIPL. Amount Facilities (INR crore) Ratings ---------- ----------- ------- Fund Based Limits Cash Credit 8.00 [ICRA]B+ ; reaffirmed Fund Based Limits Term Loan 5.00 [ICRA]B+ ; reaffirmed Non Fund Based Limits 2.00 [ICRA]A4 ; reaffirmed While reaffirming the ratings, ICRA factors in the increase in scale of operations of the company with operating income recording a ~75% yoy growth rate and stood at INR49.07 crore in 2014-15 as against INR28.07 crore in 2013-14. This was primarily driven by re association of the company with brands like Pepsico and Coca Cola. The ratings continue to be constrained by SIPL's low bargaining power given the large size of its customers and the vulnerability of its profitability to fluctuations in prices of key raw materials and foreign exchange rates. The ratings are further constrained by the financial profile characterised by low return indicators and adverse capital structure. The ratings, however, take comfort from the past experience of the promoters in manufacturing vending machines and the reputed customer profile comprising large and renowned beverage and FMCG players. The ability to improve its scale of operations while maintaining steady flow of orders with its key clients along with improving its capital structure will be some of the key rating sensitivities. SIPL was incorporated in 1966 as Karna Industries Limited (KIL) and is involved in the business of manufacturing commercial refrigeration equipment and vending machines. Initially in 2004, Seaga USA entered into a technical collaboration agreement with KIL and later on in 2007, acquired it fully and changed KIL's name to SIPL. SIPL has its manufacturing facility in Bahadurgarh, Haryana. In 2014-15, SIPL reported a net profit of INR0.48 crore on an operating income of INR49.07 crore as against a net profit of INR0.17 crore on an operating income of INR28.07 crore in the previous year. SHAKUN GASES: CRISIL Assigns 'B' Rating to INR40MM Cash Loan ------------------------------------------------------------ CRISIL has revoked the suspension of its ratings on the bank facilities of Shakun Gases Private Limited (SGPL) and has assigned its 'CRISIL B/Stable/CRISIL A4' ratings to these facilities. Amount Facilities (INR Mln) Ratings ---------- --------- ------- Proposed Cash 40 CRISIL B/Stable (Assigned; Credit Limit Suspension Revoked) Proposed Letter 200 CRISIL A4 (Assigned; of Credit Suspension Revoked) CRISIL had suspended the ratings on July 24, 2014, as SGPL had not provided the necessary information for a rating review. The company has now shared the requisite information, enabling CRISIL to assign ratings to its bank facilities. The ratings reflect SGPL's small scale of operations in cyclical and fragmented ship breaking industry and below average financial risk profile marked by moderate net worth and weak debt protection metrics. These rating weaknesses are partially offset by SGPL's extensive industry experience of the promoters. Outlook: Stable CRISIL believes that SGPL will maintain its business risk profile over the medium term on the back of extensive industry experience of its promoters in the ship breaking industry. The outlook could be revised to 'Positive' if there's significant improvement in the company's financial risk profile, backed by healthy growth in revenues and profitability . Conversely, the outlook may be revised to 'Negative' if there's a significant decline in revenues or further deterioration in profitability, capital structure or debt protection metrics. Incorporated in 1985, SGPL is engaged in ship breaking business. Mr. Sanjeev Jain and Ms. Nita Jain manage the day-to-day operations of the company. The ship breaking process is carried out at ship breaking yard in Mumbai for which the company has a plot on rent from Bombay port trust. SHANTI GOPAL: ICRA Revises Rating on INR40cr LT Loan to 'B' ----------------------------------------------------------- ICRA has revised its long-term rating on the INR40.00 crore fund based facilities of Shanti Gopal Concast Limited to [ICRA]B from [ICRA]BB-(Stable). Further, ICRA has reaffirmed its short term rating on INR2.00 crore non fund based facilities of SGCL at [ICRA]A4. Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long-term Fund Based Facilities 40.00 [ICRA]B; revised Short-term Non Fund Based Facilities 2.00 [ICRA]A4; reaffirmed The rating revision is driven by the year-on-year decline in SGCL's operating income in FY2015, which was continued in YTD FY2016 as well, due to low utilisation levels of the sponge iron unit, as well as the billet manufacturing operations. The low capacity utilisation of the sponge iron unit was due to weak demand, whereas the high cost of external power led to curtailment of the billet manufacturing operations. This led to reduced profits, which coupled with high levels of debt due to the expenditure being incurred on the captive power plant, led to sharp weakening in debt coverage indicators. The ratings continue to be constrained by the challenging business environment and the fragmented industry in which SGCL operates, which limits pricing power and hence results in modest profitability. ICRA notes that due to its modest accruals in FY2016, SGCL has remained dependent on funding support from promoters. However, the ratings continue to favourably factor in the promoters' established track record in managing various companies under the Ganga group, having demonstrated management and funding support. The ratings also favorably factor in the established relationship of the company with its customers as evident in regular repeat orders. ICRA expects that with the commissioning of the captive power plant, the capacity utilisation of SGCL's plants is likely to improve and support the profitability in FY2017. Going forward, the ability of the company to continue to receive support from the Ganga group, improve its capacity utilisation while improving the profitability and bring about a sustained improvement in its liquidity position, will be the key rating sensitivities. SGCL was incorporated in 2005 and manufactures sponge iron and steel billets. The company was initially promoted by the Agarwal family, who later sold their entire stake in the company to the Chaudhary family in October, 2011. SGCL has its manufacturing facility in Mirzapur, Uttar Pradesh, having installed capacity of 90,000 tonnes per annum (TPA) for manufacturing sponge iron and 28,800 TPA for manufacturing steel billets. The Ganga Group is a collaboration of the Chaudhary and the Tulsyan families. The group is engaged in various businesses: polywoven sacks through- Quality Woven Sacks (rated [ICRA]BB- (Stable)/A4), Ganga Bag Udyog Private Limited (rated [ICRA]BB- (Stable)/A4), Neel Kamal Polytex Industries Pvt. Ltd. (rated [ICRA]BB(Stable)) and RAS Polytex Pvt. Ltd.; paper through-Ganga Papers India Ltd. (rated [ICRA]BB- (Stable)/A4) and Ganga Pulp and Papers Pvt. Ltd., and sponge iron and billet manufacturing through SGCL. Recent Results SGCL reported an operating income (OI) of INR84.4 crore and a net profit of INR0.2 crore in FY2015, as against an OI of INR110.3 crore and a net profit of INR0.5 crore in the previous year. SHREE KRISHNA: ICRA Lowers Rating on INR48cr LT Loan to 'D' ----------------------------------------------------------- ICRA has downgraded the long term rating to [ICRA]D from [ICRA]C+ for INR48.00 crore (reduced from INR56.00 crore) fund-based bank facilities of Shree Krishna Paper Mills & Industries Limited. Also, ICRA has downgraded the long term rating for INR5.00 crore Cumulative Redeemable Preference Shares to [ICRA]D from [ICRA]C+. ICRA has also downgraded the short term rating for INR14.00 crore non fund-based bank facilities of SKPMIL to [ICRA]D from [ICRA]A4. Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long Term Fund- Based Facilities 48.00 [ICRA] D (Downgraded) Cumulative Redeemable Preference Share 5.00 [ICRA] D (Downgraded) Short Term Non Fund-Based Facilities 14.00 [ICRA] D (Downgraded) The rating downgrade takes into account recent delay in debt servicing because of continued liquidity issues being faced by the company. Though the debt levels have declined during last few years, however modest profitability coupled with large scheduled repayments during FY17 on account of ballooning of repayment obligations as per the terms of Corporate Debt Restructuring (CDR) will necessitate further restructuring of the liabilities during FY17. Accordingly, the company has delayed the repayments due in March 2016 and the debt servicing ability is expected to remain inadequate unless the repayment obligations are restructured. ICRA notes, the repayment burden in FY17 will almost double to more than INR12 crore from about INR6.9 crore in FY16 because of bunching up of repayments of term loans and cumulative redeemable preference share apart from recompense liability towards lenders under CDR. ICRA also notes that the operational performance of the company in terms of capacity utilization remains strong with capacity utilization of its newsprint plant at Kotputli exceeding 100% for last few years, which coupled with ongoing shifting of manufacturing capacity for coated paper and thermal sensitive paper from Bahadurgarh unit to Kotputli unit will benefit the company in medium term by way of cheaper grid power and operational synergies. Besides, the proposed improvements in product mix can drive improvement in sales, profits and accruals. Despite strong operational performance, high debt levels have always constrained the debt servicing ability of the company and accordingly the company also plans to reduce indebtedness by way of monetization of its land at its closed Bahadurgarh unit during FY17. Going forward, besides the restructuring of its debt repayment obligations in near term; the debt servicing ability of the company in the long term will remain contingent upon debt reduction through monetisation of land at Bahadurgarh unit and improvement in production, sales and profits through better product mix, restarting of production for coated paper and thermal sensitive paper. Shree Krishna Paper Mills & Industries Limited (SKPMIL) was incorporated by Pasari Group in the year 1972. While the Company manufactures newsprint paper, and printing and writing Paper (PWP) at its Kotputli (Rajasthan) unit, the capacities for manufacturing coated paper and thermal Sensitive Paper (TSP) earlier installed at Bahadurgarh (Haryana) unit are being shifted to Kotputli unit. The erstwhile coated paper manufacturing unit at Bahadurgarh, Haryana was acquired from Bansal Paper Mills in the year 1974, while the printing and writing paper unit at Kotputli was commissioned in FY2006. The company had availed a sizeable term loan to fund the capex at Kotputli unit. However, as the production did not commence as planned due to technical issues, the company suffered huge losses, thereby resulting in complete erosion of its net worth. Subsequently, the company made references to corporate debt restructuring in the year 2007 and in the year 2009, whereby its debt was rescheduled. In FY2015, SKPMIL reported an Operating Income (OI) of INR140.9 crore, Operating Profit before Depreciation, Interest, Taxes and Amortization (OPBDITA) of INR8.8 crore and Profit after Tax (PAT) of INR0.4 crore against an OI of INR158.2 crore, OPBDITA of INR14.8 crore and PAT of INR2.7 crore reported in FY14. Subsequently, as per provisional results for the nine month period ending Dec'15, SKPMIL has achieved an OI of INR93.1 crore and OPBDITA of INR7.4 crore vis-Ö-vis OI of INR107.5 crore and OPBDITA of INR7.6 crore achieved during the previous corresponding period. SHREE SANYEEJI: CRISIL Suspends D Rating on INR440MM Cash Loan -------------------------------------------------------------- CRISIL has suspended its ratings on the bank facilities of Shree Sanyeeji Rolling Mills (SSRM). Amount Facilities (INR Mln) Ratings ---------- --------- ------- Cash Credit 440 CRISIL D Proposed Term Loan 209.5 CRISIL D Rupee Term Loan 150.5 CRISIL D The suspension of ratings is on account of non-cooperation by SSRM with CRISIL's efforts to undertake a review of the ratings outstanding. Despite repeated requests by CRISIL, SSRM is yet to provide adequate information to enable CRISIL to assess SSRM'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 factor in its rating process as outlined in its criteria 'Information Availability - a key risk factor in credit ratings' SSRM was established as a partnership firm in 2009 and started operations from February 2011. The firm manufactures thermo- mechanically treated (TMT) bars at its unit in Guwahati (Assam). SHYAMA SAKTI: CRISIL Suspends D Rating on INR50MM Cash Loan ----------------------------------------------------------- CRISIL has suspended its rating on the bank facilities of Shyama Sakti Rice Agro Food Products Private Limited (Shyama Sakti). Amount Facilities (INR Mln) Ratings ---------- --------- ------- Cash Credit 50 CRISIL D Term Loan 20 CRISIL D The suspension of rating is on account of non-cooperation by Shyama Sakti with CRISIL's efforts to undertake a review of the ratings outstanding. Despite repeated requests by CRISIL, Shyama Sakti is yet to provide adequate information to enable CRISIL to assess Shyama Sakti'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 factor in its rating process as outlined in its criteria 'Information Availability - a key risk factor in credit ratings' Incorporated in 2008, Shyama Sakti mills non-basmati parboiled rice. Its manufacturing facility is in Galsi (West Bengal). The company's day-to-day operations are looked after by its director, Mr. Dhamadas Ghatak. SIDDARTH ORGANISATION: ICRA Assigns B+ Rating to INR2.16cr Loan --------------------------------------------------------------- ICRA has assigned its long-term rating of [ICRA] B+ to the INR2.16 crore long-term fund based facilities of Siddarth Organisation. ICRA has also assigned its long term rating of [ICRA] B+ and its short-term rating at [ICRA] A4 to the firm's INR7.84 crore unallocated Line of Credit. Amount Facilities (INR crore) Ratings ---------- ----------- ------- Cash Credit 2.16 [ICRA]B+; assigned Unallocated 7.84 [ICRA]B+/[ICRA] A4; Assigned ICRA's rating is constrained by the highly competitive nature of the garment manufacturing industry owing to its fragmented nature, which coupled with SIPL's small scale of operations has resulted in modest cash accruals. The rating is further constrained by the firm's high working capital intensity, which is on account of high inventory holding requirements, resulting in high utilization of bank limits in the past few months. The ratings also factor in the firm's modest financial profile characterised by low net worth and high gearing. ICRA also takes note of the proprietorship constitution of the firm and the risks inherent in a proprietorship concern, like limited ability to raise capital, risk of dissolution, withdrawal of capital, etc However, the ratings favorably take into account the established track record and extensive experience of the promoters in the garment manufacturing business and the firm's diversified customer base which helps reduce product off-take risk. Going forward, the ability of the firm to improve its scale of operations in a profitable manner while optimally managing its working capital cycle, will be the key rating sensitivities. The Siddarth Group comprises of three entities- namely, Siddarth Organisation, Siddarth Organisation Limited and Siddarth Intercrafts Private Limited and is engaged in the manufacturing of ladies garments, kids garments, scarfs and fashion accessories. Recent Results Siddarth Organisation reported a net profit of INR0.23 crore on an operating income of INR4.86 crore in FY15, as against a net profit of INR0.26 crore on an operating income of INR4.88 crore in FY14. The firm, on a provisional basis, reported an operating income of INR2.64 crore for nine months ending December 31st, 2015. SKD REALTY: ICRA Assigns B+ Rating to INR25cr LT Loan ----------------------------------------------------- ICRA has assigned [ICRA]B+ rating to the INR25.00 crore2 term loan facility of SKD Realty LLP. Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long Term Fund Based Limits TL 25.00 [ICRA]B+; Assigned The rating assigned to SKD Realty LLP (SKD) is constrained by execution risks for the residential project under implementation as well as market risk associated with them given the moderate level of bookings till date. ICRA also takes note of the relatively high funding risk as a substantial part of the project funding is planned to be met from customer advances, which are contingent on timing of bookings and efficiency of collections from customers; while the efficiency of collection has been satisfactory till end of December 2015, the pace of bookings has been sluggish given the ongoing slowdown and weak consumer sentiment existing in the real estate industry. The rating however, favourably factors in the established position and track record of the promoter group in real estate development having long standing experience. The rating draws comfort from the favourable location of the project, in Mira Road (East) by virtue of its proximity to basic amenities and connectivity to Thane as well as Mumbai. SKD Realty LLP (SKD) is incorporated in 2011 as a partnership firm and was later converted into LLP firm in 2014. It is engaged in construction of residential project in Mira Road, Mumbai. The firm is promoted by partners having extensive experience in the field of real estate construction in Mumbai and adjoining areas. SKD has an on-going residential project 'Pinnacolo' which consist of 5 towers of 22 storeys each. The group has experience of more than 20 years in the real estate construction business in Mumbai. SMVD POLYPACK: CRISIL Suspends B+ Rating on INR105MM LT Loan ------------------------------------------------------------ CRISIL has suspended its rating on the bank facilities of SMVD Polypack Private Limited (SPPL). Amount Facilities (INR Mln) Ratings ---------- --------- ------- Cash Credit 38 CRISIL B+/Stable Proposed Long Term Bank Loan Facility 42 CRISIL B+/Stable Term Loan 105 CRISIL B+/Stable The suspension of rating is on account of non-cooperation by SPPL with CRISIL's efforts to undertake a review of the ratings outstanding. Despite repeated requests by CRISIL, SPPL is yet to provide adequate information to enable CRISIL to assess SPPL'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 factor in its rating process as outlined in its criteria 'Information Availability - a key risk factor in credit ratings' Incorporated in January 2010, SPPL manufactures PP and HDPE woven sacks and fabric. The company commenced commercial operations in November 2012. The day-to-day operations are managed by Mr. Promod Agarwal. SRI BALAJI: CRISIL Suspends D Rating on INR650MM Cash Loan ---------------------------------------------------------- CRISIL has suspended its ratings on the bank facilities of Sri Balaji Logs Products Private Limited (SBLPL; part of the Balaji group). Amount Facilities (INR Mln) Ratings ---------- --------- ------- Cash Credit 650 CRISIL D Letter of Credit 570 CRISIL D The suspension of ratings is on account of non-cooperation by SBLPL with CRISIL's efforts to undertake a review of the ratings outstanding. Despite repeated requests by CRISIL, SBLPL is yet to provide adequate information to enable CRISIL to assess SBLPL'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 factor in its rating process as outlined in its criteria 'Information Availability - a key risk factor in credit ratings' For arriving at the ratings, CRISIL has combined the business and financial risk profiles of SBLPL, Sri Balaji Forest Products Pvt Ltd, Aeon Manufacturing Pvt Ltd, Shree Ram Saw Mill Private Limited, and MK Patel Exim Pvt Ltd. This is because these companies, collectively referred to as the Balaji group, are under a common management, operate in the same industry, and derive significant operational benefits from each other. SBLPL was set up in 1997 by the Pandey family of Kolkata (West Bengal). The Balaji group is engaged in timber trading and allied manufacturing activities. The group's product portfolio includes timber-related products such as plywood, veneers, wooden sleepers, and sawn timber. SRI SUBRAMANYESWARA: ICRA Assigns 'B' Rating to INR12.70cr Loan --------------------------------------------------------------- ICRA has assigned the long term rating of [ICRA]B to the INR12.70 crore fund based limits and INR5.50 crore unallocated limits of Sri Subramanyeswara Polymers. Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long Term Fund Based Limits 12.70 [ICRA]B; assigned Long Term Unallocated Limits 5.50 [ICRA]B; assigned The assigned rating is constrained by the small scale of operations of the firm in the highly competitive poly woven sacks industry with low entry barriers and limited product differentiation, and weak bargaining power with suppliers and customers exerting pressure on margins. The rating also factors in high sector and geographic concentration with company selling most of its products to cement manufacturers located in Telangana and Andhra Pradesh. The ratings are further constrained by the susceptibility of profitability to fluctuations in polymer prices and weak financial profile of the firm with thin net margins, stretched coverage indicators and high working capital intensity. ICRA also takes note of the capital fund withdrawal risk inherent to partnership nature of the firm. The rating, however, draws comfort from long standing experience of the promoters, healthy relationships with its customers resulting in repeat orders in the cement industry, and healthy growth in revenues at CAGR of 23% over the last 5 years backed by increase in capacity expansion and sales volumes. Going forward, ability of the firm to improve its scale of operations, profitability and capital structure will be the key rating sensitivities from credit perspective. Sri Subramaneswara Polymers (SSP) incorporated in 2007, is a partnership firm engaged in the manufacturing of HDPE/PP woven sacks. The processing unit with current installed capacity of 7560 MT per annum is located at Koilkuntla in Kurnool district of Andhra Pradesh. SSP manufactures Polypropylene (PP) bags which are majorly used for packing cement and food grains. It also sells fabric sheets which is an intermediary product in the process of making bags. Recent Results As per audited financials for FY2015, SSP reported an operating income of INR58.20 crore with profit after tax of INR0.49 crore as against INR44.41 crore of operating income with profit after tax of INR0.43 crore in FY2014. SRI VIJAYA: CRISIL Reaffirms 'B' Rating on INR70MM Cash Loan ------------------------------------------------------------ CRISIL's rating on the long-term bank facilities of Sri Vijaya Lakshmi Raw and Boiled Rice Mill (SVRB) continues to reflect the firm's below-average financial risk profile because of weak capital structure and debt protection metrics. Amount Facilities (INR Mln) Ratings ---------- --------- ------- Cash Credit 70 CRISIL B/Stable (Reaffirmed) Long Term Loan 25 CRISIL B/Stable (Reaffirmed) Proposed Long Term Bank Loan Facility 5 CRISIL B/Stable (Reaffirmed) The rating also factors in a small scale of operations in the intensely competitive rice milling industry. These rating weaknesses are partially offset by the extensive industry experience of the firm's promoters. Outlook: Stable CRISIL believes SVRB will continue to benefit over the medium term from its promoters' extensive industry experience. The outlook may be revised to 'Positive' in case of substantial increase in revenue and profitability, along with significant capital infusion, leading to a better financial risk profile. Conversely, the outlook may be revised to 'Negative' in case of aggressive, debt-funded expansion, or a steep decline in revenue and profitability, leading to deterioration in the financial risk profile. Set up in 1983 and based in Ongole, Andhra Pradesh, SVRB mills and processes paddy into rice, rice bran, broken rice, and husk. The firm is promoted by Mr. B Purna Chandra Rao and his family members. SUMIT GAS: CRISIL Suspends D Rating on INR40MM Bank Loan -------------------------------------------------------- CRISIL has suspended its ratings on the bank facilities of Sumit Gas Agencies Private Limited (SAGPL). Amount Facilities (INR Mln) Ratings ---------- --------- ------- Bank Guarantee 40 CRISIL D Cash Credit 33 CRISIL D The suspension of ratings is on account of non-cooperation by SAGPL with CRISIL's efforts to undertake a review of the ratings outstanding. Despite repeated requests by CRISIL, SAGPL is yet to provide adequate information to enable CRISIL to assess SAGPL'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 factor in its rating process as outlined in its criteria 'Information Availability - a key risk factor in credit ratings' SGAPL lays gas pipelines in cities such as Faridabad, Ghaziabad, and Delhi, and undertakes sub-contract works for gas majors such as Adani Gas Ltd, Indraprastha Gas Ltd and Gas Authority of India. It was set up as a proprietorship firm in the 1990s and reconstituted as a private limited company in 2006. The key promoter and director Mr. Puneet Sehgal manages the operations. SUNSHAKTI OIL: Ind-Ra Assigns 'IND D' Long-Term Issuer Rating ------------------------------------------------------------- India Ratings and Research (Ind-Ra) has assigned Sunshakti Oil Refinery Private Limited (SORPL) a Long-Term Issuer Rating of 'IND D'. A full list of rating actions is at the end of this commentary. KEY RATING DRIVERS The ratings reflect SORPL's delays in servicing term-loan principal repayments over the 12 months ended February 2016 due to stretched liquidity. RATING SENSITIVITIES Positive: Timely debt servicing for three consecutive months may result in a positive rating action. COMPANY PROFILE Incorporated in 2011, SORPL refines crude edible oils such as palm, sunflower, soya and cotton seed oils. SORPL's ratings: -- Long-Term Issuer Rating: assigned Long-term 'IND D' -- INR17 million long-term loan: assigned Long-term 'IND D' -- INR50 million fund-based facilities: assigned Long-term 'IND D' -- INR30 million non-fund-based facilities: assigned Short-term 'IND D' SUSHEEL YARNS: CRISIL Suspends B+ Rating on INR85MM Cash Loan ------------------------------------------------------------- CRISIL has suspended its ratings on the bank facilities of Susheel Yarns Private Limited (SYPL). Amount Facilities (INR Mln) Ratings ---------- --------- ------- Cash Credit 85 CRISIL B+/Stable Letter of Credit 10.4 CRISIL A4 The suspension of ratings is on account of non-cooperation by SYPL with CRISIL's efforts to undertake a review of the ratings outstanding. Despite repeated requests by CRISIL, SYPL is yet to provide adequate information to enable CRISIL to assess SYPL'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 factor in its rating process as outlined in its criteria 'Information Availability - a key risk factor in credit ratings' The promoters started business in 1977, this company was incorporated in 1997and these plants was put in 1999-2000.The company manufactures blended fabrics and have strategic alliance for making polyster, polyster viscose & Acrylic polyster yarns. The company has also started manufacturing of garments particularly men's wear formal & casual trousers .The company has started export of fabric, yarn & garments. SYPL's plant is in Bhilwara (Rajasthan). SUYAMBU PROJECTS: CRISIL Assigns B Rating to INR60MM Cash Loan -------------------------------------------------------------- CRISIL has assigned its 'CRISIL B/Stable/CRISIL A4' ratings to the bank facilities of Suyambu Projects (SP). Amount Facilities (INR Mln) Ratings ---------- --------- ------- Bank Guarantee 40 CRISIL A4 Cash Credit 60 CRISIL B/Stable The ratings reflect SP's nascent stage and small scale of operations in the intensely competitive civil construction industry, revenue concentration risks and working capital intensive nature of operations. These rating weaknesses are partially offset by the benefits that the firm derives from the proprietor's extensive industry experience and its below-average financial risk profile constrained by small net worth. Outlook: Stable CRISIL believes that SP will continue to benefit over the medium term from the industry experience of its proprietor in the construction industry. The outlook may be revised to 'Positive' in case of significant improvement in the company's scale of operations and profitability resulting in higher-than-expected cash accruals. Conversely, the outlook may be revised to 'Negative', if the firm undertakes larger than expected debt- funded capital expenditure or in case of decline in revenues and profitability leading to deterioration in its financial risk profile. Established as a proprietorship firm in November, 2015, SP is engaged in civil construction activities primarily roads and over bridges. Based in Chennai (Tamil Nadu), the firm is promoted by Mr. Rajesh Jeevanandem. SVL TRADING: Weak Financial Strength Cues ICRA SP 3D1 Grading ------------------------------------------------------------- ICRA has assigned 'SP 3D1' grading to SVL Trading Corporation (SVL), indicating the 'Moderate Performance Capability' and 'Weak Financial Strength' of the channel partner to undertake off-grid solar PV projects. The grading is valid for a period of two years from March 30, 2016 after which it will be kept under surveillance. ICRA has also assigned 'SP 2C2' grading to SVL Trading Corporation (SVL), indicating the 'High Performance Capability' and 'Low Financial Strength' of the channel partner to undertake off-grid solar projects. The grading is valid till 31st December 2019 after which it will be kept under surveillance. Grading Drivers Strengths * Established brand in Karnataka as one of the largest dealers of TATA Power Solar India Ltd. * Addition of established players such as Emmvee Solar, V-Guard, Bosch, Supreme Solar to its products in the thermal segment * Long track record of the promoters in the Solar Industry with established technical competence in the solar thermal and Solar PV space and also in the advisory role for developers, regulators and financial institutions Risk Factors * Small scale projects executed in Solar PV segment and moderate size of projects executed in water heaters segment * Large number of organized/ unorganized players indicating high level of competition may lead to pressure on margins * Company has a concentrated dealership network with predominant presence in Karnataka * Weak financial profile of the company indicated by increased gearing, reduced margins, and high TOL/TNW * Low Net-worth of the company SI Related Business * Promoter Track Record: The promoter of SVL Trading Corporation is Mr. Anand Reddy who has over 13 years of experience in the business areas related to Solar thermal and PV projects. He is a B.Com graduate and is responsible for the overall management and strategic decision making in SVL Trading Corporation. * Technical competence and adequacy of manpower: SVL is one of the leading authorized dealers of TATA Power Solar India Limited in Bangalore with a relationship of over 11 years. The concern deals in various solar products and has an established brand image. * Quality of suppliers and tie ups: The firm mainly supplies solar PV systems from TATA Power Solar Systems. Apart from TATA, it has added other reputed suppliers for its SPV systems and thermal segment such as Emmvee Photovoltaic Power, Promptec Renewable Energy, Southern Batteries, V-guard Industries etc. * Customer and O&M Network: SVL has a network of customers spread across the state of Karnataka which includes both institutional as well as retail customers. SVL has a well established network of around 32 sub dealers. VARDA SPINNING: CRISIL Suspends B+ Rating on INR100MM Loan ---------------------------------------------------------- CRISIL has suspended its ratings on the bank facilities of Varda Spinning and Weaving Mills Private Limited (VSWL). Amount Facilities (INR Mln) Ratings ---------- --------- ------- Cash Credit 100 CRISIL B+/Stable Long Term Loan 55 CRISIL B+/Stable Standby Line of Credit 15 CRISIL A4 The suspension of ratings is on account of non-cooperation by VSWL with CRISIL's efforts to undertake a review of the ratings outstanding. Despite repeated requests by CRISIL, VSWL is yet to provide adequate information to enable CRISIL to assess VSWL'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 factor in its rating process as outlined in its criteria 'Information Availability - a key risk factor in credit ratings' VSWL, established by Mr. Salil Malhotra and his family members in 2010, started operations in September 2010. It was purchased by Mr. Sahil Singhania and Mr. Pankaj Singhania in September 2013. The company manufactures polyester yarn at its facility in Ludhiana (Punjab). ========= J A P A N ========= TAKATA CORP: To Seek Restructuring Sponsor by August ---------------------------------------------------- Nikkei Asian Review reports that Takata Corp, mired in a deepening air bag scandal, hopes to select a sponsor by August to pursue restructuring under new management. A third-party committee of outside attorneys and others had briefed automakers and banks on the plan by April 19, Nikkei says. Takata hopes to select a sponsor by the end of August and draw up fresh rehabilitation plans, the report relates citing the committee. It likely will accept a management team from the sponsor. Chairman and CEO Shigehisa Takada, a member of the founding family, is expected to step down, the report states. According to the report, the company aims to reach an agreement with automakers and banks around September on handling of recall costs. In the interest of maintaining a steady stream of parts, Takata has pushed for a private workout with creditors to share the recall cost burden and resolve other issues rather than undergoing a court-mediated process, Nikkei notes. The report says the autoparts maker has asked automakers to resume buying its air bags after the revamped management team takes over. It will ask lenders to maintain current credit and provide new credit lines to fund bond redemptions and new investments. But with so much uncertainty over recall costs and compensation for damages, it is unclear whether a willing sponsor will emerge, according to the report. At this point, the probability of public-private funds such as the Innovation Network Corp. of Japan becoming a sponsor is slim, the third-party committee, as cited by Nikkei, said. The report says Takata views automakers as possible sponsors. But "without identifying the cause and scope of the recall, we can't discuss support or how to split costs," the report quotes an official at a major automaker as saying. Takata may face an uphill battle finding a sponsor after its earlier explanations were criticized as inadequate, the report states. As reported in the Troubled Company Reporter-Asia Pacific on Nov. 24, 2014, 24/7 Wall St. said Takata Corporation faces huge fines, and almost certainly lawsuits (which have already begun), over its defective airbags. The report related that some experts believe that the Japanese company was not forthcoming about the technical failure that caused several serious accidents and deaths. If Takata goes bankrupt, which could certainly happen, claims against the company would be in limbo, 24/7 Wall St. said. Takata Corporation (TYO:7312) develops, manufactures and sells safety products for automobiles. The Company offers seatbelts, airbags, steering wheels, child seats and trim parts. The Company has subsidiaries located in Japan, the United States, Brazil, Germany, Thailand, Philippines, Romania, Singapore, Korea, China and other countries. ==================== N E W Z E A L A N D ==================== CJ SOLUTIONS: In Liquidation; Owes More Than NZ$4.5MM ------------------------------------------------------ Stuff.co.nz reports that a Christchurch demolition company with big ticket contracts across New Zealand has gone bust owing more than NZ$4.5 million. CJ Solutions Ltd, trading as Shilton & Brown Demolition, was placed into voluntary liquidation on April 8. Stuff.co.nz relates that the company, directed and owned by James Louis Shilton, better known as Jim, has been involved in major demolition projects in post-earthquake Christchurch, including the Vero building in Hereford St. Liquidator Gordon Hansen -- gordon@pkfgf.co.nz -- of PKF Goldsmith Fox, said the business was doing work at the University of Canterbury, Christchurch's The Crossing development, the Rydges hotel in Queenstown and projects in Auckland and Wellington when it faltered, according to Stuff.co.nz. Stuff.co.nz relates that Mr. Hansen said the debt to creditors would exceed NZ$4.5 million. That would be offset by the sale of plant and equipment and recovery from debtors. The company debt included NZ$535,000 to the Inland Revenue Department, about NZ$3.4 million to unsecured creditors and small amounts owing to employees. The secured debt to the bank was about NZ$700,000, Stuff.co.nz discloses. It is understood unsecured creditors are unlikely to see any of the money recouped, Stuff.co.nz notes. "There's probably three of four [other companies] which have security over things, in terms of specific securities over equipment and vehicles, then the bank has a general security as well," the report quotes Mr. Hansen as saying. Affected unsecured creditors include scaffold, cranage, landfill businesses, and other general contractors, Mr. Hansen, as cited by Stuff.co.nz, said. "They were clearly in an insolvent situation, and they decided there was no sensible way to trade out of it, so to stop the matter from getting worse they put the company into liquidation." According to Stuff.co.nz, Mr. Hansen, who blamed the company failure on "uneconomic contracts and a poor control over cash outflows", said Shilton was devastated by the collapse. Some 35 staff had lost their jobs, but several were rehired by firms that picked up Shilton & Brown Demolition's contracts, Mr. Hansen, as cited by Stuff.co.nz, said. "We are not undertaking any further work. On each site there's generally quite considerable time constraints in order to get the demolition work done so the head contracts are moving quickly to install new contractors, and in a number of situations they are able to take on the staff." Shelton did not respond to a request for comment, the report notes. EVERGREEN LODGE: Lodges Placed Under Receivership ------------------------------------------------- Cliff Sanderson at Dissolve.com.au reports that a receivership sale has left Remarkables Lodge and Evergreen Lodge under contract. Its previous owners reportedly owe creditors over NZ$3.7 million, the report relays. Dissolve.com.au says the two Queenstown lodges became subjects to a mortgagee sale following the move of their owners to default on secured creditor interest payments. Remarkables Lodge Ltd and Evergreen Lodge Ltd which own the lodges respectively entered receivership on February 4, the report discloses. Vivian Fatupaito -- vfatupaito@kpmg.co.nz -- and Andrew Hawkes -- ahawkes@kpmg.co.nz -- from KPMG Christchurch have been appointed receivers of the companies, adds Dissolve.com.au. =============== P A K I S T A N =============== PAKISTAN: Fitch Affirms 'B' Long-Term Issuer Default Ratings ------------------------------------------------------------ Fitch Ratings has affirmed Pakistan's Long-Term Foreign- and Local-Currency Issuer Default Ratings (IDRs) at 'B' with Stable Outlooks. The issue ratings on Pakistan's senior unsecured foreign- and local-currency bonds are also affirmed at 'B'. The agency has also affirmed the Short-Term Foreign-Currency IDR at 'B' and Country Ceiling at 'B'. KEY RATING DRIVERS The ratings reflect the following factors: -- Pakistan has made progress with fiscal consolidation, restoring foreign-reserve buffers, lowering inflation and initiating structural reforms after the country agreed to an Extended Fund Facility (EFF) with the International Monetary Fund (IMF) in September 2013. Nonetheless, a difficult political and security environment, high public debt and interest burden, and low per capita incomes weigh on Pakistan's rating. -- Official reserves shrank rapidly prior to the EFF, as Pakistan had to make large repayments due from previous IMF borrowing ($US1.3billion in 2012 and $US2.3billion in 2013). However the country's external liquidity position has strengthened markedly. Pakistan's official reserve assets rose to $US19.3billion at end-February 2016 from $US8.6billion at the inception of the latest IMF programme, supported by IMF disbursements, grants and Eurobond issuances totalling $3.5billion. There is limited pressure from external debt repayments in the near term. Projected principal repayments to the IMF for the EFF are stretched over a longer timeframe, starting with $US0.2billion in 2018 and rising to $US0.8billion in 2020, with the final payment due in 2025. An $US0.75billion bond due in June 2017 is the only Eurobond maturing until 2019. Repayments for official development assistance from the Paris Club begin in 2016, but are stretched over a 23-year period. -- Fitch considers external liquidity an ongoing vulnerability for Pakistan, despite a small current account deficit compared to peers (1% of GDP in the fiscal year to June 2015 (FY15) compared with 'B' median of 7.3%) and modest net external indebtedness. Net FDI inflows have averaged just 0.7% of GDP between 2010 and 2014, requiring Pakistan to access other forms of external financing, such as portfolio flows and multilateral support. Fitch expects FDI inflows to increase substantially in the future as plans for $US46billion worth of projects linked to the China-Pakistan Economic Corridor (CPEC) get underway. However, the extent the CPEC benefits the country's external finances will depend on the exact terms of projects, particularly financing plans and the import intensity of investments. Slower remittance growth from oil producers in the Middle East could add pressure to external finances. -- Pakistan's fiscal position is a key credit weakness. Interest payments amount to almost a third of general government revenues in FY15, compared to the 'B' median of 7.4%. High public indebtedness, the expensive cost of borrowing and a small tax base contribute to the government's interest burden. However, the budget deficit narrowed to 5.3% in FY15 from 8.4% in FY13, driven by a reduction in subsidies (0.6pp) and an increase in tax revenues (1.0pp). -- The power sector is a source of contingent liabilities for the government. Clearance of payment arrears accumulated by publicly owned utilities contributed 1.4pp to the budget deficit in FY13. Payment arrears amounted to 0.8% of GDP in FY15, but were not cleared by the government and not reflected in the budget numbers. The government plans to use the proceeds from the privatisation of power distribution companies to pay off the stock of arrears. However labour unrest and legal challenges over the privatisation of Pakistan International Airlines highlight the difficulty of the process. The stock of arrears could materialise on the general government balance sheet should privatisation plans fail, and the distribution companies continue to be loss-making. The build-up of arrears has slowed due to better receivables collection, reduction of losses from transmission and distribution, and the introduction of late payment surcharges. -- The ability of the Pakistan government to sustain structural improvements and maintain macroeconomic stability after the IMF programme is completed, due in September 2016, will be an important rating driver. The implementation of politically unpopular reforms could become more challenging in the run-up to the general election, expected in 2018. Low oil prices have also cushioned the cost to consumers of adjusting utility tariffs to more economic rates. Public opposition could be greater if tariffs were to rise sharply, for example in response to a stronger rebound in oil prices than Fitch expects, -- Pakistan is underdeveloped relative to 'B'-rated peers, with GDP per capita at $US1,422 in FY15 compared with the 'B' median of $US3,625. GDP growth over the past five years has averaged lower than peers despite the lower income level, environment. Structural reforms have gradually improved the availability and reliability of energy for businesses, and continued progress would create an environment more conducive to private investment. Private credit growth has accelerated since September 2015, driven, according to authorities, by fixed investments and working capital spending. Total private- sector credit only amounted to 15.1% of GDP at end-2015, compared to the 'B' median of 37.1%. Pakistani banks are well- capitalized and profitable, and should be able to facilitate greater provision of credit. Non-performing loans are high at 11.4% of gross loans, but the ratio has been declining since 2013. -- Civilian fatalities as a result of terrorist violence fell to around 940 in 2015 from over 3000 in 2013. However, the ongoing security risks faced by Pakistan were highlighted by the bombing in Lahore on 27 March 2016 that killed over 70 civilians, the highest number of fatalities from a terrorist incident in Pakistan since about 140 civilians were killed in the Peshawar school attack on 16 December 2014. An escalation of security concerns could lead to higher fiscal expenditure, loss of investor confidence and disrupt economic activity. RATING SENSITIVITIES The main factors that could, individually or collectively, lead to a negative rating action are: -- Policy slippage that leads to renewed pressure on economic and financial stability, which may be evident in a rapid loss of reserves or sharp rise in inflation. -- Deterioration in the fiscal position that leads to a sharp or sustained rise in government debt ratios, including contingent liabilities from state-owned entities. -- Political instability sufficient to damage the country's economic or financial stability The main factors that could, individually or collectively, lead to a positive rating action are: -- Sustained fiscal consolidation, strengthening of the revenue base, reduction in government debt ratios and the smaller contingent liabilities from state-owned entities. -- Progress with structural reform that leads to improvement in the business environment, stronger economic growth and higher investment. -- An improved security situation and decreased political risk KEY ASSUMPTIONS -- The ratings incorporate an assumption that Pakistan's relations with India do not deteriorate to the point of renewed armed conflict. -- The global economy is presumed to perform broadly in line with Fitch's latest Global Economic Outlook report. =========== T A I W A N =========== WAN HAI: Moody's Retains Ba2 CFR on Slightly Weaker 2015 Results ---------------------------------------------------------------- Moody's Investors Service says that Wan Hai Lines Ltd.'s slightly increased financial leverage in 2015 will not immediately affect its Ba2 corporate family rating. The rating outlook remains stable. "Wan Hai's financial leverage increased slightly in 2015 and will likely stay at current levels over the next 12-18 months, but remains appropriate for its Ba2 rating," says Chenyi Lu, a Moody's Vice President and Senior Analyst. Wan Hai's adjusted net debt/EBITDA rose slightly to 1.8x in 2015 from 1.6x in 2014, mainly due to an increase in adjusted net debt to NTD22.8 billion at end-2015 from NTD20.3 billion at end-2014. The additional net debt was driven by a decline in its cash balance to NTD21.9 billion at end-2015 from NTD26.8 billion at end-2014, in turn due to a NTD4.4 billion cash dividend payment in 2015. The dividend was much higher than the NTD1.8 billion paid in 2014, as a result of the company's stronger net earnings in 2014 than in 2013. Moody's expects Wan Hai's adjusted net debt/EBITDA to remain around 1.5x-2.0x over the next 12-18 months, based on its (1) short-term vessel chartering strategy; (2) purchase of slot capacity from partners; and (3) limited capital expenditure. This ratio positions it well at the Ba2 rating level. Wan Hai's revenue will likely decline by 3% in 2016 and remain flat in 2017, driven by lower freight rates amid a challenging operating environment stemming from industry overcapacity and weak demand. "We expect Wan Hai's adjusted EBITDA margin to stay at its current level, supported by its implementation of operating efficiency and cost improvement measures," adds Lu. Wan Hai's revenue declined by 4.7% to NTD63.9 billion in 2015, as lower freight rates were partially offset by a growth in sales volume despite the challenging market conditions in the liner market. The company's adjusted EBITDA margin rose slightly to 19.6% in 2015 from 19.4% 2014, as a result of relatively low bunker costs, cost improvement measures, and stronger sales volumes. Wan Hai's liquidity profile remains strong. At end-2015, Wan Hai had cash and cash equivalents of NTD21.8 billion and short-term marketable investments of NTD3.4 billion, which together provide a strong liquidity reserve for its short-term maturing debt of NTD8.3 billion over the next 12 months and projected capital expenditure of NTD4.0 billion over the same period. The principal methodology used in this rating was Global Shipping Industry published in February 2014. Wan Hai Lines Ltd. listed on the Taiwan Stock Exchange in May 1996. At end-2015, it operated a fleet of 89 container vessels (72 wholly owned and 17 chartered), offering intra-Asia, Asia- Middle East, and Trans-Pacific liner services. With 32 dedicated service routes at end-2015, Wan Hai is the leading provider of intra-Asia container shipping services with an estimated 20% market share. ********* 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 2016. 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 ***