/raid1/www/Hosts/bankrupt/TCRAP

/raid1/www/Hosts/bankrupt/TCRAP_Public/160616.mbx T R O U B L E D C O M P A N Y R E P O R T E R A S I A P A C I F I C Thursday, June 16, 2016, Vol. 19, No. 118 Headlines A U S T R A L I A CASSA BEDDING: First Creditors' Meeting Set for June 24 COOPERS TRANSPORT: First Creditors' Meeting Set for June 23 DEJAI LIVE: Liquidators Put Business Up for Sale DICK SMITH: Supplier to Provide Customer Refunds For JVC TV DYNAMIC WINDOW: First Creditors' Meeting Set for June 23 IL CAMINETTO: First Creditors' Meeting Set for June 24 QUEENSLAND NICKEL: Liquidators Seek Fresh Court Summons vs Palmer * Moody's Forecasts Wider Deficits in FY2016/17 for Queensland C H I N A FUTURE LAND: Moody's Changes Outlook on Ba3 CFR to Stable HUA HAN: Moody's Puts Provisional Ba3 Rating to Prop. Sr. Notes SICHUAN COAL: Flags Bond Default Risks as Debt Woes Spread I N D I A AADITYA KRAFT: CRISIL Reaffirms 'B' Rating on INR179.5MM Loan ADI WIRES: CRISIL Reaffirms 'D' Rating on INR31.8MM Term Loan AGROW FOODS: CARE Assigns 'B' Rating to INR10.0cr LT Loan ANDHRA ASBESTOS: ICRA Suspends 'B' Rating on INR6.0cr Loan ARABIAN GOLD: CRISIL Assigns B+ Rating to INR170MM Cash Loan ARIDO CERAMIC: ICRA Suspends 'B' Rating on INR7.0cr Term Loan ARIO INFRASTRUCTURE: CARE Lowers Rating on INR28cr Loan to D BALAJI INTERNATIONAL: CARE Assigns B+ Rating to INR2cr LT Loan BHUJBAL BROTHERS: CRISIL Suspends 'D' Rating on INR90MM LT Loan BKN DEVELOPERS: CRISIL Suspends B+ Rating on INR150MM LT Loan BKR HOTELS: CRISIL Suspends 'D' Rating on INR144.1MM Term Loan BOSS COTTON: CRISIL Suspends 'B' Rating on INR50MM Cash Loan CEBON CERAMIC: CARE Revises Rating on INR3.6cr LT Loan to B+ CHARISMA GOLDWHEELS: ICRA Suspends B+ Rating on INR6cr Loan DEV COTEX: CARE Lowers Rating on INR10cr LT Loan to 'D' DHANPATI AGRO: CRISIL Assigns 'D' Rating to INR65MM Cash Loan DIAMOND TMT: CRISIL Reaffirms B+ Rating on INR300MM Cash Loan EMAAR DEVELOPERS: CRISIL Assigns B+ Rating to INR200MM Loan GWALIOR DISTILLERIES: CARE Cuts Rating on INR37.5cr LT Loan to B+ HILLS CEMENT: ICRA Suspends 'D' Rating on INR162.23cr LT Loan KARAN ASHOK: CRISIL Reaffirms B+ Rating on INR100MM e-DFS KUTTANAD RUBBER: CRISIL Reaffirms 'B' Rating on INR10MM Loan KWALITY TOWNSHIP: ICRA Lowers Rating on INR5.0cr Loan to 'D' LANDMARK DEVELOPMENT: CRISIL Assigns B+ Rating to INR50MM Loan LION INSULATION: CARE Lowers Rating on INR7.33cr LT Loan to 'D' MAHA LAXMI: CRISIL Reaffirms 'B' Rating on INR30MM Cash Loan MANGALA SEEDS: CARE Assigns B+ Rating to INR8.0cr LT Loan MARVELOUS ENGINEERS: CARE Rates INR6.70cr LT Bank Loan at 'B' MEENAKSHI ASSOCIATES: CRISIL Reaffirms D Rating on INR100.8M Loan NANDI POLYMERS: ICRA Suspends 'B' Rating on INR9.15cr FB Loan NEC PACKAGING: CRISIL Assigns 'B' Rating to INR40MM Cash Loan PERFECT ENGINEERS: CRISIL Reaffirms B+ Rating on INR60MM Loan PRADHVI MULTITRADE: ICRA Suspends 'D' Rating on INR10cr Loan RAJGAD DNYANPEETH: CRISIL Suspends 'D' Rating on INR120MM Loan RAJKAMAL TEXTILES: CRISIL Reaffirms B+ Rating on INR50MM Loan REAL INNERSPRING: ICRA Reaffirms B+ Rating on INR3.25cr Loan SAMRADDHI COT: CARE Reaffirms B+ Rating on INR7.01cr LT Loan SHREE GANESH: ICRA Suspends 'D' Rating on INR265.99cr Loan SHREE RAJ: ICRA Withdraws 'B' Rating on INR4.70cr Term Loan SIDHIVINAYAK FILAMENTS: ICRA Suspends B/A4 Rating on INR47cr Loan SRI VANI: CRISIL Assigns 'B' Rating to INR10MM Cash Loan SUPREME EXPORTS: CARE Assigns 'B' Rating to INR5.0cr LT Loan SURYODAYA INFRA: ICRA Suspends B+ Rating on INR4.0cr Loan TOP GEAR: CRISIL Reaffirms B+ Rating on INR47.8MM LT Loan TRIVENI WIRES: ICRA Assigns 'B' Rating to INR25.0cr Loan UMIYA ENTERPRISE: ICRA Assigns 'B+' Rating to INR5.89cr LT Loan VANGILI FEEDS: CRISIL Cuts Rating on INR162.1MM Term Loan to B+ VASAVI NIRMAAN: CRISIL Cuts Rating on INR75MM LT Loan to 'B' VERTICE GLOBAL: CRISIL Assigns B- Rating to INR119MM LT Loan VINAYAGA IMPEX: CRISIL Lowers Rating on INR45MM Loan to 'D' N E W Z E A L A N D REYNOLDS GROUP: S&P Revises Outlook to Pos. & Affirms 'B' CCR S O U T H K O R E A DAEWOO SHIPBUILDING: Audit Agency Finds KRW1.5TT in Acctg Fraud - - - - - ================= A U S T R A L I A ================= CASSA BEDDING: First Creditors' Meeting Set for June 24 ------------------------------------------------------- Christopher Cook & Raj Khatri of Worrells Solvency & Forensic Accountants were appointed as administrators of Cassa Bedding Pty Ltd on June 14, 2016. A first meeting of the creditors of the Company will be held at Worrells Solvency & Forensic Accountants, Level 8, 102 Adelaide Street, in Brisbane, Queensland, on June 24, 2016, at 11:30 a.m. COOPERS TRANSPORT: First Creditors' Meeting Set for June 23 ----------------------------------------------------------- Brent Trevor-Alex Kijurina and Richard Albarran of Chadwick Chartered Accountants were appointed as administrators of Coopers Transport Australia Pty Ltd. A first meeting of the creditors of the Company will be held at Wesley Mission, Pollard Room, Lower Level Ground, 220 Pitt Street, in Sydney, on June 23, 2016, at 11:00 a.m. DEJAI LIVE: Liquidators Put Business Up for Sale ------------------------------------------------ Cliff Sanderson at Dissolve.com.au reports that Dejai Live Pty Ltd has been put up for sale. The company is currently under the control of liquidator Tony Cant of Romanis Cant Chartered Accountants, the report discloses. Dissolve.com.au relates that the sale includes the company's title, right and interest in intellectual property as well as other assets. Dissolve.com.au says the buyer of the company will get to acquire an established relationship with an international manufacturer and other suppliers. Dejai Live is the developer of an advanced telematics rear-view mirror device for corporations managing big vehicle fleets that include vans, leased vehicle, car rental and light commercial vehicles. Dejai entered administration on March 30, 2016. DICK SMITH: Supplier to Provide Customer Refunds For JVC TV ----------------------------------------------------------- Dominic Powell at SmartCompany reports that consumer electronics supplier Yale Prima Ltd has committed to providing full refunds for faulty televisions bought from Dick Smith before the retailer collapsed into receivership in January. According to SmartCompany, Yale Prima Pty Ltd will offer full refunds to consumers who bought unrepairable JVC branded televisions prior to January 5, using the conditions of its own 12-month warranty, following an investigation by the Australian Competition and Consumer Commission. The supplier imported Chinese-made televisions, which were then sold on to Dick Smith, the report says. SmartCompany relates that the ACCC said it received complaints from consumers in the aftermath of Dick Smith's collapse, with those consumers claiming they were not able to arrange repairs. replacements or refunds for faulty goods after the retail chain was placed under external administration. The report says Yale Prima had initially referred complaints to Dick Smith's receiver, Ferrier Hodgson. After April 1, the supplier then agreed to give partial refunds, despite the manufacturer's warranty allowing for full refunds. According to SmartCompany, ACCC Chairman Rod Sims said in a statement both retailers and manufacturers have obligations to provide remedies under the Australian Consumer Law (ACL). "When a retail business ceases trading, it is important that consumers are able to turn to the manufacturer for remedies, and it is equally important that manufacturers recognise their ongoing ACL obligations," the report quotes Mr. Sims as saying. James Douglas, commercial lawyer at LegalVision, told SmartCompany suppliers need to be aware of their obligations to consumers of their products under the ACL. When the goods are manufactured internationally, suppliers such as Yale Prima are considered the importer of the products and have to adhere to ACL appropriately, Mr. Douglas told SmartCompany. In this case, by referring complaints on to the receiver, Douglas says the company was "essentially trying to make it the receivers' obligation"."Suppliers have an obligation under ACL, and they're effectively the importer in this situation," SmartCompany quotes Mr. Douglas as saying. "Outside of this, the suppliers obligations depend on the contract with the retailer. About Dick Smith Dick Smith Holdings Limited Ltd (ASX:DSH) -- http://dicksmithholdings.com.au/-- is a retailer of consumer electronics products. The Company sells a range of products across four categories: office, mobility, entertainment, and other products and services. The Company has two segments: Dick Smith Australia and Dick Smith New Zealand. The Company connects with its customers through four physical store formats, catering for three distinct consumer demographics: Dick Smith, MOVE, David Jones Electronics Powered by Dick Smith and MOVE by Dick Smith Sydney International Airport. The Company's store network consists of approximately 393 stores across Australia and New Zealand, which include approximately 351 Dick Smith stores, approximately 10 MOVE stores, approximately four MOVE by Dick Smith stores and approximately 28 David Jones Electronics Powered by Dick Smith stores. As reported in the Troubled Company Reporter-Asia Pacific on Jan. 6, 2016, Dick Smith Holdings Ltd was placed in receivership on Jan. 5 following the appointment of Voluntary Administrators. Ferrier Hodgson partners Mr James Stewart, Mr Jim Sarantinos and Mr Ryan Eagle were appointed Receivers and Managers over DSH and an number of associated entities. The appointment was made by a syndicate of lenders which hold security over the group. DYNAMIC WINDOW: First Creditors' Meeting Set for June 23 -------------------------------------------------------- Stephen Robert Dixon and Ahmed Bise of Grant Thornton were appointed as administrators of Dynamic Window Systems Pty Ltd on June 10, 2016. A first meeting of the creditors of the Company will be held at the offices of Grant Thornton Australia Limited, The Rialto, Level 30, 525 Collins Street, in Melbourne, Victoria, on June 23, 2016, at 11:00 a.m. IL CAMINETTO: First Creditors' Meeting Set for June 24 ------------------------------------------------------ Richard Trygve Rohrt of Hamilton Murphy Certified Practising Accountants was appointed as administrator of Il Caminetto Pty Ltd, trading as Il Caminetto Pizza, on June 15, 2016. A first meeting of the creditors of the Company will be held at Hamilton Murphy Certified Practising Accountants, 237 Swan Street, in Richmond, Victoria, on June 24, 2016, at 11:00 a.m. QUEENSLAND NICKEL: Liquidators Seek Fresh Court Summons vs Palmer ----------------------------------------------------------------- Joshua Robertson at The Guardian reports that liquidators of Queensland Nickel have been forced to seek fresh court summonses to grill Clive Palmer and his associates after the outgoing federal MP hit them with a compensation claim blaming them for the demise of the business. According to The Guardian, lawyers for FTI Consulting were due to question Mr. Palmer's nephew and Queensland Nickel managing director Clive Mensink in the federal court on June 14 but failed to serve him in person before he went on holiday to Hong Kong. It came after Mr. Palmer, who faces being pursued over the alleged siphoning of AUD224 million from Queensland Nickel, ramped up his legal counter-attack in a lawsuit accusing FTI Consulting of triggering the collapse of his Townsville refinery after the firm was sacked as administrators, The Guardian says. According to the report, the court issued fresh summonses for Mensink, Palmer and Queensland Nickel general manager Ian Ferguson to appear on dates to be fixed, with no less than eight days' written notice. The Guardian relates that Chris Curtis, acting for the liquidators, told the court Mensink had "acknowledged service [of the old summons] by email . . . however there needs to be personal service [and] he is in Hong Kong". "We haven't served the others," Mr. Curtis, as cited by the Guardian, said. According to The Guardian, Mensink's lawyer Brendan Nyst told reporters outside court his client was "happy to appear before the examination if he's properly served". The report relates that Mr. Nyst said he could only speculate as to why liquidators had not done so before the old summons lapsed. The report says Mr. Palmer, in a claim filed against four FTI Consulting staff in the Queensland supreme court, alleged FTI Consulting withheld assets from cash to nickel stock and a fleet of 40 vehicles, leading to the loss of "essential leases and contracts" needed to keep the operation afloat. While Mr. Palmer has previously said the claim would be for AUD1.2 billion, court papers only state his companies QNI Metals and QNI Resources -- which own the refinery run by Queensland Nickel in a joint venture -- seek "equitable compensation" or "alternatively, damages for breach of contract". In its final report, FTI alleged it had evidence of Mr. Palmer acting as a "shadow director" in allegedly uncommercial director- related transactions worth hundreds of millions of dollars. These allegedly took place prior to Queensland Nickel going into voluntary administration in January, The Guardian discloses. These allegedly included money paid to Mr. Palmer's political party and his close relatives, and for mines, a vintage car collection, golf courses, resorts and the tycoon's ill-fated quest to build a replica of the Titanic, according to the Guardian. It said there may be evidence of "reckless conduct" by Palmer and Mensink which could result in criminal charges. The Guardian relates that FTI Consulting's John Park later said he expected the liquidator's actions, including the gathering of evidence through public examinations and attempts to recover funds, to be "vigorously defended". However, Palmer's lawsuit seeks a court order that he, as chairman of a joint venture owners committee, "was at all material times empowered to provide the general manager with directions in respect of the duties and responsibilities of the general manager," the report relays. The Guardian adds that the lawsuit also rejects FTI Consulting's claim it is owed AUD16.4 million by Palmer's parent companies for its administration duties. It claims the damage from the fallout of FTI's administration includes "loss of installed assets at the Port of Townsville valued at AUD214.5 million," the report relays. 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. FTI went from being administrators to liquidators at the second creditors meeting in April, after issuing a damning report into Queensland Nickel's finances, The Courier-Mail reported. * Moody's Forecasts Wider Deficits in FY2016/17 for Queensland -------------------------------------------------------------- Moody's Investors Service says that the State of Queensland's budget for FY2016/17, published on June 14, projects larger deficits for FY2016/17 and over the next three years when compared to projections made one year ago in its FY2015/16 budget. This expected deterioration in its financial performance reflects much lower royalty and tax income and, to a lesser extent, increased current spending, which is a credit negative. The general government sector's forecast budget gap for FY2016/17 is now projected to be AUD2.0 billion, or 3.8% of revenues (on a net lending/borrowing basis), which contrasts with the deficit of AUD968 million, or 1.8% of revenue, forecast a year ago for the same year. This negative adjustment of AUD1.0 billion reflects much lower assumptions for oil and metallurgical coal prices, which shave AUD739 million off royalty income, and weaker payroll tax income as higher paid mining jobs are replaced by service jobs with lower wages. These weaker revenue trends are partially offset by larger Goods and Services tax-backed (GST) Commonwealth grants, reflecting Queensland's increased share of grants due to its weaker revenue-raising ability and the growth in GST collections. At the same time, the government has implemented some new spending initiatives focused on efforts to boost economic growth during the transition period following the end of the mining investment boom. Furthermore, if a one-time AUD501 million Commonwealth disaster relief grant -- which was postponed from the prior year -- is excluded, the underlying deficit would have been higher. The budget also reported that estimated results for FY2015/16, are now expected to be better than budget with the deficit put at AUD940 million, or 1.9% of revenues, below the AUD1.2 billion or 2.3% in the budget. Furthermore, after excluding a deferment of the AUD1.1 billion disaster relief grants to subsequent years, the state would have registered a small surplus, in part due to a postponement in capital expenditures. Over the medium term, deficits from FY2015/16 through FY2018/19 are estimated to average a higher 3.3% of revenues compared to the 1.9% forecast last year for the same years. Principally, royalties which last year were projected to rise at an average 13.0% over the four years through FY2018/19, are now instead forecast to rise by a slower 4.2%. This trend, along with slower growth in taxes, has led to lower projected revenue growth, which is now forecast to rise by an average 2.6%, and just under the current expenditure rise of 2.7%; these growth rates are affected by the timing of Commonwealth grants for disaster relief. The state's ability to adjust down its spending in a weaker revenue environment will be challenging given upward pressures in healthcare and other social services, and will necessitate strong fiscal resolve if current spending is to be controlled. Moody's notes costs have begun rising at a faster rate as the government implements new initiatives. For example, current spending rose by 6.7% in FY2014/15 and is expected to rise by 5.5% in FY2016/17, well above the average projected over the next four years. Despite a lower rate of spending estimated for FY2015/16 at 1.2%, Moody's notes that employee costs in that year rose sharply by 7.6% due to new hiring for health services and indicate the challenges the state faces in controlling expenditures. The state's fiscal principles include a provision that current revenues must cover a large portion of capital spending which should help minimize fiscal deficits, helping to ease its above- average debt burden. However, Moody's also notes that the weakening in the state's gross operating balance to an average 7.9% over the four years through FY2018/19, down from the 9.6% forecast last year, somewhat diminishes the buffer to fund capital expenditures. Further supporting budget redress is a new policy that will limit new full time equivalent positions in accordance with population growth. The government has placed a strong emphasis on easing its debt burden over the medium term. However, the approach to debt reduction focuses on a re-structuring of its balance sheet rather than reducing the size of its consolidated cash deficits -- forecast to be in excess of AUD10 billion on a cumulative basis over the four years through FY2019/20. The state's "Debt Action Plan" includes applying AUD4 billion of its superannuation fund assets -- currently more than 100% funded -- to debt reduction and to fund capital expenditures. These measures follow last year's use of financial assets that are held for liabilities relating to long-service leave for debt reduction, a 5-year holiday in contributions to the superannuation fund, and the transference of debt from the general government sector to electric utilities. As part of its normal monitoring process, Moody's will evaluate the FY2016/17 budget, including the reasonableness of budget assumptions, the government's commitment to implement improved cost controls, and its flexibility to respond to potential further revenue volatility in royalties. Moody's assigns long-term issuer and debt ratings of Aa1/negative to the Queensland Treasury Corporation (QTC), the entity that issues debt on behalf of Queensland and its government owned corporations. QTC's debt is guaranteed by Queensland and the rating reflects the state's credit quality. ========= C H I N A ========= FUTURE LAND: Moody's Changes Outlook on Ba3 CFR to Stable --------------------------------------------------------- Moody's Investors Service has changed the outlook to stable from negative on Future Land Development Holdings Limited's Ba3 corporate family rating. At the same time, Moody's has affirmed both Ba3 corporate family rating and B1 senior unsecured debt rating. RATINGS RATIONALE "The stable outlook reflects that Future Land's sales execution, funding access and liquidity position have not been affected by the investigation of its controlling shareholder and chairman, Mr. Wang Zhenhua," says Stephanie Lau, a Moody's Assistant Vice President and Analyst. Future Land's contracted sales for January-May 2016 were up 140% year-on-year to RMB21.0 billion, representing around 52% of its full-year contracted sales target of RMB40 billion. The company's funding access has also not been affected by the investigation of its chairman. Its key Shanghai-listed subsidiary, Future Land Holdings Co., Ltd issued a second tranche of domestic private placed bonds totaling RMB3 billion in March 2016 at a weighted average coupon rate of 5.2%, which is lower than the 6% coupon rate from the first tranche issuance of RMB2.0 billion in November 2015. The company's liquidity position was adequate at end-2015, with a cash to short-term debt ratio of 195%. In view of the company's solid contracted sales in the first five months of 2016 and the issue of the private placed domestic bonds, Moody's expects the company's liquidity position will remain adequate despite the investigation of its chairman. Future Land's Ba3 corporate family rating reflects its long and solid track record in Jiangsu Province. The company's small- to medium-sized sales and operating scale, and moderate credit metrics position it at the low Ba rating level. Moody's estimates that Future Land's revenue-to-debt and adjusted homebuilding EBIT interest coverage will be at around 120%-125% and 3.2x-3.3x respectively in the next 12-18 months, metrics that are appropriate for its current Ba3 rating. On the other hand, its Ba3 rating is constrained by its high concentration in the Yangtze River Delta. As a result, Future Land is exposed to volatility in one regional economy. Furthermore, its investment holding in its Shanghai-listed subsidiary, Future Land Holdings Co., Ltd, limits the free flow of surplus cash within the group. Future Land will mainly rely on its cash-on-hand, property investment profits derived from co-investments with Future Land Holdings, property management profits, and dividends from Future Land Holdings to service its debt and interest payments. Moody's also expects the high level of ownership by Mr. Wang will ensure that Future Land will have sufficient financial support from the group to cover its debt obligations. Upward pressure on the ratings is limited in the near term. Nevertheless, upward ratings pressure may emerge over the medium term if Future Land: (1) achieves its contracted sales targets over the next 1-2 years and grows its scale and geographic diversity within China; (2) shows good financial discipline and expands cautiously, while maintaining a sound liquidity profile and strong credit metrics, with its cash holdings sufficient to cover the short-term debt held by its non-Mainland-listed property portfolio; (3) improves the balance of revenues and profits between Future Land and Future Land Holdings Co., Ltd; and/or (4) improves its credit metrics, such that its EBIT/interest coverage exceeds 4.0x-4.5x. Future Land's ratings could be downgraded if: (1) its sales decline significantly; (2) it materially increases its investments in debt-funded projects; (3) there is a material weakening in balance-sheet liquidity, with cash/short-term debt coverage falling below 1.0x; (4) its credit metrics deteriorate, with EBIT/interest falling below 2.5x-3.0x, and/or revenue/adjusted debt falling below 85%-90%; (5) its debt levels rise significantly and it can no longer service its liabilities from its own operating cash flow and expected dividends from Future Land Holdings Co., Ltd; and/or (6) there is a material reduction in its ownership of Future Land Holdings Co., Ltd, or Future Land Holdings Co., Ltd's dividend payout policy changes such that Future Land's expected dividend income falls. The principal methodology used in these ratings was Homebuilding And Property Development Industry published in April 2015. Future Land Development Holdings Limited was founded in 1996 by its chairman, Mr. Wang Zhenhua. Mr. Wang has been in the property development business in China since 1993. The company listed on the Hong Kong Stock Exchange in November 2012. At end-December 2015, Future Land maintained a presence in 25 cities in China, with an attributable land bank of approximately 13.1 million square meters of gross floor area. HUA HAN: Moody's Puts Provisional Ba3 Rating to Prop. Sr. Notes ---------------------------------------------------------------- Moody's Investors Service has assigned a provisional (P)Ba3 rating to Hua Han Health Industry Holdings Limited's (Ba3 stable) proposed senior notes. At the same time, Moody's has affirmed Hua Han's Ba3 corporate family rating. The outlook on the ratings is stable. The proceeds from the proposed note issuance will be used for general corporate purposes. The provisional status of the rating will be removed upon completion of the bond issuance under satisfactory terms and conditions. RATINGS RATIONALE "The rating of the proposed notes is not notched down from Hua Han's corporate family rating of Ba3, because we expect that the company's level of secured and subsidiary debt will stay below 15% of total assets over the next 12-18 months," says Gloria Tsuen, a Moody's Vice President and Senior Analyst. The proposed bond issuance -- which will be used to support the company's capital expenditure (capex) needs -- will drive up Hua Han's adjusted debt/EBITDA to around 3x for the fiscal year ending 30 June 2016 (FY2016), up from 0.8x in FY2015. If Hua Han's capex levels remain high in FY2017, its debt leverage could rise to about 4x. Moody's expects that the company will manage its capex plans such that its adjusted debt/EBITDA will fall below 3.5x by end-FY2017. The company's plan to maintain a net cash position also provides some buffer against high near-term leverage. Moody's expects that Hua Han will continue to ramp up its hospital management business, and leverage should moderate to around 2x in FY2018. Hua Han's Ba3 corporate family rating reflects its established domestic market position as a pharmaceutical company -- mainly in traditional Chinese medicines -- with stable product demand, and steady profits and cash flows. This core business, combined with a solid net cash position, supports the company's efforts in developing new bio- pharmaceutical products, and more importantly, in diversifying its business to include hospital management services. However, Hua Han's rating is constrained by its small scale, the product and geographic concentration of its traditional Chinese medicine business, as well as intense competition and pricing pressure in the Chinese pharmaceutical industry. Hua Han's expansion into hospital services also poses execution and financial risks. The stable outlook on Hua Han's rating reflects Moody's expectation that the company will: (1) maintain its disciplined approach to financial management and a net cash position; (2) show solid profitability; and (3) implement the expansion of its hospital management plan within its budget and timeframe. Upward rating pressure is limited in the near to medium term, because the Ba3 rating factors in the successful rollout of Hua Han's expansion of its hospital management plan -- including the construction of its owned hospitals -- the financial benefits of which may not become fully apparent until FY2018. However, upward rating pressure could emerge in the longer term if the company: (1) ramps up and completes the development of its three owned hospitals without delays or cost overruns; (2) maintains a high profitability in its pharmaceuticals business; and (3) reduces leverage, as measured by adjusted debt/EBITDA to around 2.0x. Downward rating pressure could emerge if: (1) delays in the completion of its owned hospital construction, cost overruns, changes in industry conditions, government policies or the pursuit of growth initiatives result in Moody's view that the company's debt/EBITDA will likely trend above 3.5x by FY2017; or (2) there is a significant deterioration in the company's liquidity position, or its net cash position turns negative. The principal methodology used in these ratings was Global Pharmaceutical Industry published in December 2012. Listed on the Hong Kong Stock Exchange in 2002, Hua Han Health Industry Holdings Limited manufactures and distributes traditional Chinese medicines and bio-pharmaceutical medicines, and provides hospital services in China. Annual revenues for FY2015 amounted to HKD1.8 billion (USD235 million). SICHUAN COAL: Flags Bond Default Risks as Debt Woes Spread ----------------------------------------------------------- Bloomberg News reports that a Chinese coal firm said it may miss a bond payment as debt woes spread in the world's second-biggest economy. Sichuan Coal Industry Group, based in the southwestern province of Sichuan, is uncertain it can repay CNY1.057 billion ($160.1 million) of bond principal and interest due June 15, it said in a statement to Shanghai Clearing House on June 14, Bloomberg relates. The state-owned company sold the CNY1 billion of one- year notes with a 5.72 percent coupon in 2015. According to Bloomberg, Chinese coal firms have struggled as the nation's worst economic slowdown in a quarter century batters demand and Premier Li Keqiang vows to cut excess capacity in industries. The companies need to repay CNY233 billion of bonds coming due by the end of this year, Bloomberg-compiled data show. Chinacoal Group Shanxi Huayu Energy Co. failed to make a note payment in April, Bloomberg notes. "This wave of defaults may continue to spread for those coal companies that have a lot of debt due this year," Bloomberg quotes Helen Lau, an analyst at Argonaut Securities (Asia) Ltd. in Hong Kong, as saying. "That said, for this company, let's see if there is white knight for rescue or if creditors want to extend a grace period or if they can secure refinancing loans from banks." Sichuan Coal is facing a cash shortage and is still trying to raise funds for the payment, according to the statement cited by Bloomberg. The company is reaching out to all parties including the government to help raise funding to pay the bond, Chen Yongjun, the person listed as a contact in the statement, said when reached by phone on June 14, Bloomberg relays. China's coal production fell 11% to 268 million tons in April, Bloomberg discloses. That's the biggest slump in data going back to April 2015. The company is wholly owned by the State-Owned Assets Supervision and Administration Commission of Sichuan Province, rating firm Shanghai Brilliance Credit Rating & Investors Service Co. said in a statement on Chinamoney website on May 30, Bloomberg discloses. ========= I N D I A ========= AADITYA KRAFT: CRISIL Reaffirms 'B' Rating on INR179.5MM Loan ------------------------------------------------------------- The rating on the long-term bank facilities of Aaditya Kraft & Papers Private Limited (AKPPL) continues to reflect exposure to risks related to implementation of its ongoing project of setting up a kraft paper unit. Amount Facilities (INR Mln) Ratings ---------- --------- ------- Cash Credit 33 CRISIL B/Stable (Reaffirmed) Term Loan 179.5 CRISIL B/Stable (Reaffirmed) The rating also factors in the start-up phase and expected small scale of operations in the highly fragmented and intensely competitive industrial paper segment. These rating weaknesses are mitigated by the entrepreneurial experience and funding support of promoters. Outlook: Stable CRISIL believes AKPPL will benefit over the medium term, from the entrepreneurial experience and funding support of promoters. The outlook may be revised to 'Positive' if the ongoing project is completed within stipulated time and cost, and generates strong revenue and profitability, resulting in sizeable cash accrual. Conversely, the outlook may be revised to 'Negative' if delay in completion of project and stabilisation of operations leads to low revenue and profitability; or if large working capital requirement or debt-funded capital expenditure weakens financial risk profile, particularly liquidity. AKPPL, incorporated in 2012 by Mr. Bibekananda Behara and family, manufactures kraft paper. The manufacturing facility is Cuttack (Odisha); and is expected to commence commercial production from June 2016. ADI WIRES: CRISIL Reaffirms 'D' Rating on INR31.8MM Term Loan ------------------------------------------------------------- CRISIL's rating on the long-term bank facilities of Adi Wires Private Limited (AWPL) continues to reflect instances of delay in its debt-servicing owing to weak liquidity. Further, there have been continuous overdrawals in the company's cash credit limit. Amount Facilities (INR Mln) Ratings ---------- --------- ------- Cash Credit 23.5 CRISIL D (Reaffirmed) Term Loan 31.8 CRISIL D (Reaffirmed) AWPL also has a weak financial risk profile with modest networth, subdued debt protection metrics, modest scale and working- capital-intensive operations. These weaknesses are partially offset by the extensive experience of the promoters in the steel industry, mainly in sponge iron and ingot manufacturing. Incorporated in 2006, Jharkhand-based AWPL manufactures binding wires and wire nails, which are largely used in the construction industry. The company is promoted and managed by Mr. Amit Sarawgi and Mr. Rohit Jain. AGROW FOODS: CARE Assigns 'B' Rating to INR10.0cr LT Loan --------------------------------------------------------- CARE assigns 'CARE B' rating to the bank facilities of Agrow Foods. Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long-term Bank Facilities 10.00 CARE B Assigned Rating Rationale The rating assigned to the bank facilities of Agrow Foods (AF) is constrained on account of the risk related to stabilization of operations, vulnerability to fluctuations in prices of raw material and presence in a highly fragmented industry limiting the bargaining power of the firm. The above weaknesses are partially offset by the strong promoter background with established relations with customers and suppliers. The ability of the company to establish itself in the industry and increase the scale of operations remain the key rating sensitivity. AF was established in the year 2015 by Mr. Swapnil Munde and is engaged in the trading and processing of food grains (pulses) in Nagpur (Maharashtra). The commercial operations of the entity started in September, 2015. The entity currently has a network of six suppliers including Shri Laxmi Tirumamba Murmura Industries, Paramal Pulses Private Limited and Balaji Industries. The top three customers of AF include Hanuman Dal Industries (rated CARE BB-), Girni Agro Products Private Limited and Tirupati Enterprises. ANDHRA ASBESTOS: ICRA Suspends 'B' Rating on INR6.0cr Loan ---------------------------------------------------------- ICRA has suspended [ICRA]B rating assigned to the INR6.00 crore fund based facilities and and INR1.00 crore unallocated limits of Andhra Asbestos Transport Company. The suspension follows ICRA's inability to carry out a rating surveillance in the absence of the requisite information from the company. Andhra Asbestos Transport Company (AATC) was incorporated as a partnership firm in 2006 to carry out dealership business of petroleum products for Bharat Petroleum Corporation Limited. It operates a retail outlet at Kadapa Bypass , Kadapa dist of Andhra Pradesh with a storage capacity of 4*20,000 Litres of oil. The firm is promoted by Mr Pasupuleti Brahmaih and his sons. Mr Pasupuleti is also involved in business of vegetable oil extraction (soya , rice bran and sunflower) and owns 3 other filling stations though other partnership firms. ARABIAN GOLD: CRISIL Assigns B+ Rating to INR170MM Cash Loan ------------------------------------------------------------ CRISIL has assigned its 'CRISIL B+/Stable' rating to the long- term bank facility of Arabian Gold and Diamonds (AGD). Amount Facilities (INR Mln) Ratings ---------- --------- ------- Cash Credit 170 CRISIL B+/Stable The ratings reflect below-average financial risk profile marked by a high gearing and small networth and exposure to risks related to modest scale of operations in the intensely competitive gold jewellery industry. These rating weaknesses are mitigated by the extensive experience of promoters in the gold jewellery retailing market. Outlook: Stable CRISIL believes AGD will continue to benefit over the medium term from the extensive industry experience of its promoters. The outlook may be revised to 'Positive' in case of better-than- expected operating revenue and margin, and net cash accrual, while improving debt protection metrics. Conversely, the outlook may be revised to 'Negative' if weak operating cycle, lower-than- expected growth in revenue and margins, or large, debt-funded capital expenditure, leads to weak debt protection metrics. AGD was set up in 2005, in Kerala, as a proprietorship concern by Mr. Abdul Rahiman Kunju for trading, manufacturing and retailing gold and diamond jewellery. ARIDO CERAMIC: ICRA Suspends 'B' Rating on INR7.0cr Term Loan ------------------------------------------------------------- ICRA has suspended the long term rating to [ICRA]B for INR3.00 crore fund based cash credit facility and INR7.00 crore term loan facility of Arido Ceramic. ICRA has also suspended an [ICRA]A4 rating to INR1.15 crore short term non fund based facilities of AC. Amount Facilities (INR crore) Ratings ---------- ----------- ------- Cash Credit Limit 3.00 [ICRA]B suspended Term Loan 7.00 [ICRA]B suspended Short Term-Non Fund Based Facilities 1.15 [ICRA]A4 suspended Arido Ceramic (AC) was incorporated in May 2013 as a partnership firm and is engaged in manufacturing of digitally printed ceramic glazed wall tiles. The manufacturing unit of the firm is located in Morbi, Gujarat, with an installed capacity of 30,000 MTPA. The commercial production has started from February 2014.The firm is promoted and managed by Mr. Rajesh Suvariya along with other family members and relatives. ARIO INFRASTRUCTURE: CARE Lowers Rating on INR28cr Loan to D ------------------------------------------------------------ CARE revises the ratings assigned to the bank facilities of Ario Infrastructure Private Limited. Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long-term/Short-term Bank Facilities 28 CARE D/CARE D Revised from CARE BB/ CARE A4 Rating Rationale The revision in the rating assigned to the bank facilities of Ario Infrastructure Private Limited (AIPL) is primarily due to irregularity in servicing its debt obligations due to weak liquidity position. Establishing a clear debt servicing track record with an improvement in the liquidity position is the key rating sensitivity. Ario Infrastructure Pvt. Ltd. (AIPL), promoted by Mr. Ajit Sarkar, was incorporated in November, 2009. AIPL took over the business operations of a partnership concern M/s. Ario Brothers, which was formed by Mr. Ajit Sarkar in 1976. AIPL has a track record of executing various small and midsized cross country pipelines, city gas distribution network, plant piping, equipment erection and other civil structural work projects. AIPL has established track record of implementing projects for various PSU clients such as GAIL, GSPL, ONGC, IOCL, and BPCL and has executed works in the states like Gujarat, Maharashtra, Uttar Pradesh and NCR region. BALAJI INTERNATIONAL: CARE Assigns B+ Rating to INR2cr LT Loan -------------------------------------------------------------- CARE assigns 'CARE B+/CARE A4' ratings to the bank facilities of Balaji International. Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long-term Bank Facilities 2 CARE B+ Assigned Short-term Bank Facilities 8 CARE A4 Assigned Rating Rationale The ratings assigned to Balaji International are primarily constrained by weak financial risk profile as marked by small scale of operations, decline in the total operating income, low profitability margins, leveraged capital structure, weak debt service coverage indicators and working capital intensive nature of operations. The ratings are further constrained by foreign exchange fluctuation risk, partnership nature of its constitution, regulatory risk, business susceptible to the vagaries of nature and fragmented and competitive nature of the industry. The ratings, however, draw comfort from experience of the partners in processing of rice and favourable manufacturing location. Going forward, the ability of the firm to profitably scale up its operations while improving its capital structure and managing the working capital requirements shall be the key rating sensitivities. Haryana-based Balaji International was established as a partnership firm in 1989 by Mr. Amar Nath, Mr. Kailash Chander, Mrs. Achla Rani and Mrs. Parveen Kumari sharing profits and losses in equal ratio. The firm is engaged in the milling and processing of basmati rice with an installed capacity of 6 metric ton per hour (MTPH) at its manufacturing unit located in Kurukshetra Road, Sandholi, Pehowa. The firm procures raw material (paddy) from local grain markets through commission agents in Haryana and Uttar Pradesh. The firm mainly exports its product to Middle East countries such as Jordan, Saudi Arabia, Dubai, Kuwait, etc. The firm also sells its product domestically to brokers and traders located in Haryana, Delhi and West Bengal under the brand name "Sargam" and "Khushi". The by-product of paddy, viz, husk, rice bran, and phak is also sold in the domestic market. The firm has three associate concerns, namely, Balaji Overseas, Shiv Shankar Rice Mills and Ishan International, all engaged in milling of rice. In FY15 (refers to the period April 1 to March 31), the firm has achieved a total operating income (TOI) of INR97.25 crore with PBILDT and PAT of INR4.65 crore and INR0.29 crore, as against total operating income (TOI) of INR146.93 crore with PBILDT and PAT of INR6.80 crore and INR0.61 crore in FY14. Furthermore, in FY16, the firm achieved total sales of INR35 crore (as per the unaudited results). BHUJBAL BROTHERS: CRISIL Suspends 'D' Rating on INR90MM LT Loan --------------------------------------------------------------- CRISIL has suspended its rating on the bank facility of Bhujbal Brothers Construction Co. (BBCC). Amount Facilities (INR Mln) Ratings ---------- --------- ------- Long Term Loan 90 CRISIL D The suspension of rating is on account of non-cooperation by BBCC with CRISIL's efforts to undertake a review of the ratings outstanding. Despite repeated requests by CRISIL, BBCC is yet to provide adequate information to enable CRISIL to assess BBCC'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' Established in 1970, BBCC undertakes residential real estate development, mainly in Pune (Maharashtra). The firm is promoted by Mr. Ramesh Bhujbal and his family members. BKN DEVELOPERS: CRISIL Suspends B+ Rating on INR150MM LT Loan ------------------------------------------------------------- CRISIL has suspended its rating on the bank facility of BKN Developers Pvt. Ltd. (BKN). Amount Facilities (INR Mln) Ratings ---------- --------- ------- Long Term Loan 150 CRISIL B+/Stable The suspension of rating is on account of non-cooperation by BKN with CRISIL's efforts to undertake a review of the ratings outstanding. Despite repeated requests by CRISIL, BKN is yet to provide adequate information to enable CRISIL to assess BKN'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' Set up in 2012, Bengaluru based BKN is engaged in real estate development. The day-to-day operations are managed by its promoter director Mr. L. Balakrishnama Naidu. BKR HOTELS: CRISIL Suspends 'D' Rating on INR144.1MM Term Loan -------------------------------------------------------------- CRISIL has suspended its rating on the bank facilities of BKR Hotels and Resorts Pvt Ltd (BHRPL; part of the BKR group). Amount Facilities (INR Mln) Ratings ---------- --------- ------- Cash Credit/ Overdraft facility 9.3 CRISIL D Proposed Long Term Bank Loan Facility 46.6 CRISIL D Term Loan 144.1 CRISIL D The suspension of rating is on account of non-cooperation by BHRPL with CRISIL's efforts to undertake a review of the ratings outstanding. Despite repeated requests by CRISIL, BHRPL is yet to provide adequate information to enable CRISIL to assess BHRPL'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 rating, CRISIL has combined the business and financial risk profiles of BKR Hotels and BKR Hotels & Resorts Pvt Ltd (BHRPL). This is because both the entities, together referred to as the BKR group, are engaged in the same line of business, and have a common management and fungible cash flows. The BKR group operates a hotel, BKR Grand, and a convention centre at Thyagaraya Nagar in Chennai. BHRPL was incorporated in July 2007, while BKR Hotels was established as a partnership firm in May 2010. Both the entities are located on the same premises and are commonly managed. BOSS COTTON: CRISIL Suspends 'B' Rating on INR50MM Cash Loan ------------------------------------------------------------ CRISIL has suspended its rating on the bank facilities of Boss Cotton & Oil Industries (BCOI). Amount Facilities (INR Mln) Ratings ---------- --------- ------- Cash Credit 50 CRISIL B/Stable Proposed Long Term Bank Loan Facility 26.5 CRISIL B/Stable Term Loan 23.5 CRISIL B/Stable The suspension of rating is on account of non-cooperation by BCOI with CRISIL's efforts to undertake a review of the ratings outstanding. Despite repeated requests by CRISIL, BCOI is yet to provide adequate information to enable CRISIL to assess BCOI'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' Set up in 2014, BCOI is a partnership firm located in Rajkot (Gujarat). Its partners have about 10 years of experience in the cotton industry. BCOI recently set up a unit to carry out cotton ginning, pressing, and oil extraction; the unit commenced operations in October 2014. CEBON CERAMIC: CARE Revises Rating on INR3.6cr LT Loan to B+ ------------------------------------------------------------ CARE revokes suspension and revises the lt rating and reaffirms the st rating assigned to the bank facilities of Cebon Ceramic Private Limited. Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long-term Bank Facilities 3.60 CARE B+ Suspension revoked and rating Revised from CARE B Long-term/Short-term Bank 1.00 CARE B+/CARE A4 Facilities Suspension revoked and rating Revised from CARE B/CARE A4 Short-term Bank Facilities 1.00 CARE A4 Suspension revoked and rating Reaffirmed Rating Rationale The revision in the long-term rating assigned to the bank facilities of Cebon Ceramic Private Limited (CCPL) is mainly on account of stabilization of operation during FY16 (Provisional, refers to the period April 01 to March 31) on the back of successful completion of its project. The ratings, however, continue to remain constrained on account of susceptibility of its operating margins to volatility in prices of natural gas and key raw materials, presence in a highly competitive ceramic tiles industry and fortunes linked to demand from the cyclical real estate sector. Furthermore, the ratings also remain constrained on account of its nascent stage of operation and its financial risk profile marked by thin profitability, moderately leveraged capital structure, moderate debt coverage indicators and moderate liquidity position during FY16 (Provisional). However, the rating continues to derive strength from wide experience of the promoters in the ceramic industry and location advantage with presence in ceramic hub with easy access to raw material, fuel and labor. The ability of CCPL to increase its scale of operations along with improvement in the overall financial risk profile amidst highly competitive ceramic industry along with efficient working capital management are the key rating sensitivities. CCPL was incorporated in January 2014 by Mr Amitkumar T Patel and Mr Manishkumar J Aghara. Both the promoters possess long experience in the ceramic industry and jointly manage operation of CCPL. CCPL is engaged into business of manufacturing of digital ceramic wall tiles of two different sizes 10"*13" and 10"*15". CCPL is operating from its sole manufacturing plant located in Morbi (Gujarat) with an installed capacity of 12,000 MTPA (Metric Tonnes Per Annum) as on March 31, 2016. CCPL completed its green field project having total cost of INR9.34 crore during March 2015 and commenced commercial operation from April 2015. During FY16 (Prov.), CCPL reported a PAT of INR0.02 crore on a total operating income (TOI) of INR12.54 crore. CHARISMA GOLDWHEELS: ICRA Suspends B+ Rating on INR6cr Loan ----------------------------------------------------------- ICRA has suspended [ICRA]B+ rating assigned to the INR6.00 crore fund based facilities of Charisma Goldwheels Private Limited. The suspension follows ICRA's inability to carry out a rating surveillance in the absence of the requisite information from the company. CGPL was incorporated in 1998 and has been operating as an authorised dealer for vehicles of Hyundai Motors in Chandigarh. The company deals in sale of new cars, repairs and servicing of cars. The day to day management of the company is taken care by Mr. Pratap Hoon. The company has one 3S (showroom, spares, service) sales showroom cum service workshop located in the industrial area of Chandigarh. DEV COTEX: CARE Lowers Rating on INR10cr LT Loan to 'D' ------------------------------------------------------- CARE revises the rating assigned to the bank facilities of Dev Cotex Private Limited. Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long term Bank Facilities 10 CARE D Revised from CARE B Rating Rationale The revision in the rating assigned to the bank facilities of Dev Cotex Private Limited (DCPL) is primarily driven by delay in debt repayment due to weak liquidity position. Establishing a clear debt servicing track record with an improvement in the liquidity position is the key rating sensitivity. Gondal-based (Rajkot) Dev Cotex Private Limited (DCPL) is engaged in the business of trading of cotton, cotton bales and cotton seeds. It was established in 2010 by Mr Anilkumar Selani and Mr Dhirajlal Selani and was taken over by Mr Bharatkumar V Selani and Mr Chirag B Selani in October 2014. Present directors are associated with Shiv Cotgin Private Limited of Gondal (Rajkot) which is also into cotton and kapas trading business. DCPL operates from its sole warehouse situated at new sardar market yard, Gondal. DHANPATI AGRO: CRISIL Assigns 'D' Rating to INR65MM Cash Loan ------------------------------------------------------------- CRISIL has assigned its 'CRISIL D' rating to the long-term bank facilities of Dhanpati Agro Udyog Private Limited (Dhanpati). Amount Facilities (INR Mln) Ratings ---------- --------- ------- Cash Credit 65 CRISIL D Term Loan 20.7 CRISIL D The rating reflects instances of delay by Dhanpati in meeting its debt obligations resulting from weak liquidity due to highly working capital-intensive operations. The rating also reflects weak financial profile because of high gearing and moderate debt protection metrics, and small scale of operations in the highly fragmented industry. These weaknesses are mitigated by promoters' experience and their funding support, and moderate operating profitability margins. Dhanpati was established in 2010 as a private-limited company by Mr. Brahmanand Jaiswal and his sons, Mr. Saurabh Jaiswal and Mr. Subhash Jaiswal. The company processes majorly basmati and non- basmati rice at its plant at Gorakhpur, Uttar Pradesh. Dhanpati has total milling and sorting capacity of 10 tonne per hour. DIAMOND TMT: CRISIL Reaffirms B+ Rating on INR300MM Cash Loan ------------------------------------------------------------- CRISIL's ratings on the bank facilities of Diamond TMT and Procon Private Limited (Diamond TMT) continue to reflect the company's limited track record in the intensely competitive steel industry. This weakness is partially offset by its promoters' extensive industry experience, and its comfortable financial risk profile. Amount Facilities (INR Mln) Ratings ---------- --------- ------- Bank Guarantee 10 CRISIL A4 (Reaffirmed) Cash Credit 300 CRISIL B+/Stable (Reaffirmed) Term Loan 80 CRISIL B+/Stable (Reaffirmed) Outlook: Stable CRISIL believes Diamond TMT will continue to benefit over the medium term from its promoters' industry experience. The outlook may be revised to 'Positive' if liquidity improves on account of significant increase in revenue and net cash accrual. The outlook may be revised to 'Negative' if debt protection metrics weaken because of low net cash accrual driven by subdued operating margin. Update Topline declined to INR1.24 billion in 2015-16 (refers to financial year, April 1 to March 31) from INR1.29 billion in 2014-15, while profitability remained at 3.0-3.5 percent. Working capital cycle was moderate, as indicated by gross current assets of 60-90 days as on March 31, 2016, driven by inventory of 30-45 days. Bank limit utilisation was moderate, averaging 60 percent. Financial risk profile remained below-average because of high gearing of 1.8-2.0 times and modest networth of INR100-110 million as on March 31, 2016. Debt protection metrics were subdued, with interest coverage ratio of 1.6 times in 2015-16. Diamond TMT, incorporated in February 2010, is promoted by Mr. Ajay Jain and his son Mr. Akshay Jain. The company has a thermo- mechanically treated (TMT) re-rolling mill in Bhavnagar, Gujarat. It began commercial production in April 2014. EMAAR DEVELOPERS: CRISIL Assigns B+ Rating to INR200MM Loan ----------------------------------------------------------- CRISIL has assigned its 'CRISIL B+/Stable' rating to the long- term bank facility of EMAAR Developers And Builders Private Limited (EDBPL). Amount Facilities (INR Mln) Ratings ---------- --------- ------- Project Loan 200 CRISIL B+/Stable The rating reflects susceptibility to timely implementation and saleability of EDBPL's ongoing project because of early stage of construction and low initial bookings, and exposure to cyclicality in the Indian real estate sector. These rating weaknesses are partially offset by the extensive experience of the company's promoters in Nagpur's real estate industry, and advantageous location and affordability of the ongoing project. Outlook: Stable CRISIL believes EDBPL will continue to benefit over the medium term from the extensive industry experience of its promoters and advantageous location and affordability of its ongoing project. The outlook may be revised to 'Positive' in case of better-than- expected booking of units and receipt of customer advances, leading to sizeable cash inflow. Conversely, the outlook may be revised to 'Negative' in case of a time or cost overrun in the ongoing project or slower-than-expected ramp-up in customer bookings, leading to lower-than-anticipated cash inflow and deterioration in the company's financial risk profile, particularly liquidity. Incorporated in 1997, EDBPL is promoted by Mr. Madan Balaji Ratan along with his family members. It undertakes residential and commercial real estate development in Nagpur. The company is presently developing Ratan City, a residential-cum-commercial project, in Nagpur. GWALIOR DISTILLERIES: CARE Cuts Rating on INR37.5cr LT Loan to B+ ----------------------------------------------------------------- CARE revises the rating assigned to the bank facilities of Gwalior Distilleries Limited. Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long term Bank Facilities 37.50 CARE B+ Revised from CARE BB- Rating Rationale The revision in the rating assigned to the bank facilities of Gwalior Distilleries Limited (GDL) takes into account delay in the implementation of project on account of delay in the receipt of letter of intent from the State Government and deterioration in financial risk profile marked by decline in operating income and cash accruals and deterioration in solvency and liquidity position in FY16 (Provisional) (refers to the period April 1 to March 31). The rating continues to be constrained on account of sensitivity of the business to government regulations and geographical concentration risk. The rating continues to draw support from the long track record of the entity with experienced promoters and high entry barriers in the liquor industry. Timely completion of its debt-funded capex along with stabilization of operations and achieve envisaged level of operations while improving its profit margins and solvency position and manage its working capital requirement efficiently remain the key rating sensitivity. GDL was incorporated in the year 1986 by Mr. Govind Yadav to undertake the business of blending and bottling of Indian made Foreign Liquor (IMFL). The product range of the company includes brandy, dry gin, rum and whisky under brand names of Royal Champ Whisky, Fauji Rum, Blue Bird Gin, Fauji Whisky, Oskar Whiskey and Royal Class Whisky. The IMFL blending and bottling unit of the company is located in Bhind district of Madhya Pradesh and has a total installed capacity of 90,000 cases per annum. The blending and bottling of the products are done under the permissible limits of Madhya Pradesh State Excise department. Presently, GDL is in the process of undertaking backward integration of operations by setting up a unit for the manufacturing of the basic raw material i.e., ENA and RS, which was otherwise being sourced from third parties. GDL has proposed for an installed capacity of 40KL (kilo litre) for the manufacturing of ENA and INR The basic raw material used for the manufacturing process is broken rice and bajra which the company will procure from local suppliers in and around Gwalior, Madhya Pradesh. The company will produce DDGS (Distillers dried grain stillage) a.k.a. a cattle feed as the byproduct and expects to further sell the same in Gwalior, Punjab, Haryana etc. During FY15, GDL earned a PAT of INR0.41 crore on a total income of INR7.87 crore as against a PAT of INR0.71 crore on a total income of INR6.95 crore for FY14. Furthermore, GDL earned a PAT of INR0.13 crore on a total income of INR4.73 crore during FY16 (Provisional). HILLS CEMENT: ICRA Suspends 'D' Rating on INR162.23cr LT Loan ------------------------------------------------------------- ICRA has suspended the [ICRA]D rating assigned to the INR162.23 crore long term loans & working capital facilities of Hills Cement Company Ltd. 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. KARAN ASHOK: CRISIL Reaffirms B+ Rating on INR100MM e-DFS --------------------------------------------------------- CRISIL's rating on the long-term bank facilities of Karan Ashok Auto Pvt. Ltd. (KAAPL) continues to reflect a modest scale of operations in the intensely competitive automobile dealership market, along with low bargaining power with the principal, Honda Cars India Ltd (HCIL). Amount Facilities (INR Mln) Ratings ---------- --------- ------- Drop Line Overdraft Facility 12.5 CRISIL B+/Stable (Reaffirmed) Electronic Dealer Financing Scheme (e-DFS) 100 CRISIL B+/Stable (Reaffirmed) Term Loan 18.5 CRISIL B+/Stable (Reaffirmed) The rating also factors in a below-average financial risk profile marked by a high total outside liabilities to tangible net worth ratio. These rating weaknesses are partially offset by the company's established position as an automobile dealer for HCIL in the Kumaon region of Uttarakhand. Outlook: Stable CRISIL believes KAAPL will continue to benefit over the medium term from its established market position. The outlook may be revised to 'Positive' in case of substantial improvement in sales volume and operating margin, or significant equity infusion resulting in a better capital structure, along with prudent working capital management. Conversely, the outlook may be revised to 'Negative' if market share reduces, thereby significantly impacting revenue and profitability, or in case of any large, debt-funded capital expenditure, or further stretch in working capital requirement, leading to deterioration in liquidity. KAAPL was incorporated in 2010, promoted by the Haldwani, Uttarakhand-based Singh family. The company runs HCIL dealerships in Haldwani, Rudrapur, and Moradabad. Mr. Ashok Pal Singh and his son, Mr. Gaurav Singh, the directors, manage operations. KUTTANAD RUBBER: CRISIL Reaffirms 'B' Rating on INR10MM Loan ------------------------------------------------------------ CRISIL's rating on the bank facilities of The Kuttanad Rubber Co Ltd (KRCL) continues to reflect KRCL's modest scale of operations in the intensely fragmented rubber plantation industry and the susceptibility of its operating performance to volatility in rubber prices. These rating weaknesses are partially offset by the long standing regional presence of KRCL aided by its promoters' industry experience. Amount Facilities (INR Mln) Ratings ---------- --------- ------- Cash Credit/ Overdraft facility 10 CRISIL B/Stable (Reaffirmed) Long Term Loan 0.5 CRISIL B/Stable (Reaffirmed) Outlook: Stable CRISIL believes that KRCL will continue to benefit over the medium term from its promoters' extensive industry experience. The outlook may be revised to 'Positive' in case of significant improvement in the company's scale of operations and profitability margin or in case there is higher than expected decline in the loans and advances extended to associate company. Conversely, the outlook may be revised to 'Negative' in case of decline in the company's scale of operations and profitability or in case of deterioration in the company's capital structure on account of stretch in working capital cycle of any large debt- funded capital expenditure. KRCL is a closely held public limited company and operates a rubber plantation of 440 acres in Kanjirapally (Kerala). The company extracts raw rubber latex from its plantation and sells it to local centrifuged latex (cenex; used in making medical and surgical items) manufactures. The daily operations of the company is managed by the executive director, Mr. Joseph Thomas. KWALITY TOWNSHIP: ICRA Lowers Rating on INR5.0cr Loan to 'D' ------------------------------------------------------------ ICRA has revised the long term rating assigned to INR5.0 crore term loan of Kwality Township Pvt. Ltd. from [ICRA]B+ to [ICRA]D. Amount Facilities (INR crore) Ratings ---------- ----------- ------- Term Loan Facility 5.0 [ICRA]D; Downgraded ICRA has downgraded the ratings assigned to bank lines of KTPL due to delays in servicing of debt obligations. The delays have occurred because of stretched liquidity position of company, on backdrop of weak market scenario. Going forward, regularization of debt servicing will be the key rating sensitivity. Incorporated in 2009, KTPL undertakes development of housing projects and townships and undertook its first township project, "ARK City" in 2009. In this project located in Meerut, Uttar Pradesh, the company sold 300 plots and is developing single storey and duplex houses on another 100 plots as row houses. KTPL commenced the construction of its second project "ARK Residency", Meerut, in 2012. This is a mixed use project, comprising 72 commercial units and 45 residential units. The total project cost is estimated at INR19.72 crore, which is proposed to be funded by customer advances (40%), promoter's contribution (35%) and debt (25%). LANDMARK DEVELOPMENT: CRISIL Assigns B+ Rating to INR50MM Loan -------------------------------------------------------------- CRISIL has assigned its 'CRISIL B+/Stable' rating to the long- term bank facility of Landmark Development Corporation Private Limited. Amount Facilities (INR Mln) Ratings ---------- --------- ------- Proposed Long Term Bank Loan Facility 50 CRISIL B+/Stable The rating reflects susceptibility to implementation risks related to a recently launched residential project, and to risks and cyclicality inherent in the Indian real estate industry. These rating weaknesses are partially offset by the extensive experience of the promoters of the company in the real estate sector, primarily in development of land plots. Outlook: Stable CRISIL believes LDCPL will continue to benefit over the medium term from the extensive experience of its promoters in the real estate sector. The outlook may be revised to 'Positive' if healthy bookings for an ongoing project and timely receipt of advances lead to sizable cash inflows. Conversely, the outlook may be revised to 'Negative' if lower bookings, time or cost overrun in the project, or simultaneous launch of other projects lead to weakening of liquidity. Incorporated in 2012 and promoted by Mr. Vishal Chavan, Mr. Rupesh Chavan, and Mr. Anand Mahajan, LDCPL develops residential land plots and real estate projects in and around Pune. The company has successfully sold three land plotting schemes near Pune so far and will be selling a fourth in the near term. It has recently launched a residential real estate project, Elite Homes, which has 173 saleable units. LION INSULATION: CARE Lowers Rating on INR7.33cr LT Loan to 'D' --------------------------------------------------------------- CARE revises the rating assigned to the bank facilities of Lion Insulation Private Limited. Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long-term Bank Facilities 7.33 CARE D Revised from CARE B Rating Rationale The revision in the rating assigned to the bank facilities of Lion Insulation Private Limited (LIPL) is primarily due to irregularity in servicing its debt obligations due to weak liquidity position. Establishing a clear debt servicing track record with an improvement in the liquidity position is the key rating sensitivity. LIPL was incorporated in 2011. LIPL had set up a manufacturing plant located at Guna, Madhya Pradesh with total capacity of 9000 MTPA for manufacturing thermal and acoustical insulation products like Rockwool mattress, Rockwool slabs and pipe section, which will be used in refineries, chemicals plants and malls where temperature control is required. LIPL has commenced commercial production from December 2013. LIPL procures its raw material from Dhanbad (Coal mines), Bhilai (steel plants and iron ore plants) and from various local markets. LIPL has been supplying its product to the reputed clients like Lloyd Insulation (India) Limited and National Thermal Power Corporation Limited and is also targeting various government agencies like Bharat Heavy Electricals Limited. MAHA LAXMI: CRISIL Reaffirms 'B' Rating on INR30MM Cash Loan ------------------------------------------------------------ CRISIL's ratings on the bank loan facilities of Maha Laxmi Agro Tech (MLAT) continues to reflect small scale of operations in fragmented rice milling industry and susceptibility of its operating margin to adverse government regulations and volatility in raw material prices. These weaknesses are partially offset by the extensive experience of its management in rice milling industry and its moderate financial risk profile. Amount Facilities (INR Mln) Ratings ---------- --------- ------- Bank Guarantee 0.1 CRISIL A4 (Reaffirmed) Cash Credit 30.0 CRISIL B/Stable (Reaffirmed) Letter of Credit 3.5 CRISIL A4(Reaffirmed) Term Loan 25.0 CRISIL B/Stable (Reaffirmed) Outlook: Stable CRISIL believes that MLAT will continue to benefit from the extensive industry experience of its promoters over the medium term. The outlook may be revised to 'Positive' if the scale of operations significantly improves leading to improvement in its cash accruals. Conversely, the outlook may be revised to 'Negative' if there is a significant decline in its operating performance, or in case if the firm undertakes a large debt- funded capital expenditure in case of significant capital withdrawals by partners leading to weakening in its financial risk profile. Incorporated in 2011 as a partnership firm, MLAT has set up a plant to mill and process paddy into parboiled rice, rice bran, broken rice, and husk. The firm commenced commercial production in July 2012. There are 11 partners in the firm; Mr. B Jagdish and Mr. G Saibaba manage the firm's day-to-day operations. MANGALA SEEDS: CARE Assigns B+ Rating to INR8.0cr LT Loan --------------------------------------------------------- CARE assigns 'CARE B+' rating to the bank facilities of Mangala Seeds. Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long-term Bank Facilities 8.0 CARE B+ Assigned Rating Rationale The rating assigned to the bank facilities of Mangala Seeds (MS) is constrained by relatively small scale of operations coupled with low profitability, leveraged capital structure and weak debt coverage indicators, working capital intensive nature of operations due to elongated operating cycle, competition from other established players and MNCs in seed business and constitution of the entity as a partnership firm. However, the rating is underpinned by the established track record and experience of the partners for about three decades in seed business and strong marketing network within Warangal. The ability of the firm to improve its scale of operations and profitability margins, capital structure and efficiently manage its working capital requirements are the key rating sensitivities. MS was started as Hindu Undivided Family (HUF) on Oct. 4, 1999, by Mr Madishetty Ashok. In March 2007, Mr Madishetty retired from HUF and established Mangala Seeds as a partnership firm on April 01, 2007 with Mr Gourishetty Nagaraju as second partner. The firm is engaged in the production, procurement, processing, marketing and distribution of Paddy seeds in Warangal, Telangana. The processing unit of the firm is located at Madikonda,Warangal. MS purchases the breeder seeds (initial level or raw seeds) of paddy from the state authorities and Agriculture Universities. These seeds are sold to farmers for up-gradation to foundation seeds. Foundation seeds are then repurchased back from farmers for further germination and for producing final seeds as per the specifications of State Certification Agency (for agriculture seed). Post certification, these seeds are sold commercially in packed form. MARVELOUS ENGINEERS: CARE Rates INR6.70cr LT Bank Loan at 'B' ------------------------------------------------------------- CARE assigns 'CARE B' and 'CARE A4' ratings to the bank facilities of Marvelous Engineers Private Limited. Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long term Bank Facilities 6.70 CARE B Assigned Short-term Bank Facilities 0.11 CARE A4 Assigned Rating Rationale The ratings assigned to the bank facilities of Marvelous Engineers Private Limited (MEPL) are constrained on account of small scale of operations along with low profit margins, leveraged capital structure, weak debt coverage indicators, weak liquidity position and susceptibility of operating margins to volatility in raw material prices. The ratings draw support from the experience of the promoters of more than two decades, reputed and established client base and operational linkages with group concerns. The ability to improve profitability along with improvement in capital structure are the key rating sensitivities. MEPL is a Kolhapur-based (Maharashtra) company incorporated in March, 1990. It is promoted by Mr Sangram Vishnu Patil, Mr Vishnu Baburao Patil and is managed by the Patil family of Kolhapur. Since inception, the company is engaged in manufacturing of precision engineering and auto components namely bearing, chasis, brackets, cover, drum, flywheel, hub, housing, pinion which are used in earth moving equipment, trucks, tractors and allied equipment. The manufacturing facility of the company is ISO 9001:2000 certified and located at Kolhapur. The company mainly caters to the domestic market. Moreover, it also exports its products (around 30% of the total revenue in FY15 -- refers to the period April 1 to March 31) mainly to countries like United States, Brazil and Italy. MEPL's clients are reputed entities in their respective line of business such as John Deere India Private Limited, Lombardini S.R.I, Fairfield Atlas Limited, Comet S.P.A, Hyva India Private Limited, etc. Its top five customers contributed around 70% of the total income in FY15. MEENAKSHI ASSOCIATES: CRISIL Reaffirms D Rating on INR100.8M Loan ----------------------------------------------------------------- CRISIL has reaffirmed its ratings on the bank loan facilities of Meenakshi Associates Private Limited (MAPL) at 'CRISIL D/CRISIL D'. The rating continues to reflect continuous devolvement of letter of credit (LC), due to which its cash credit facility is over utilised, this is because of weak liquidity on account of large receivables and inventory. Amount Facilities (INR Mln) Ratings ---------- --------- ------- Bank Guarantee 100.8 CRISIL D (Reaffirmed) Cash Credit 70 CRISIL D (Reaffirmed) Letter of Credit 55 CRISIL D (Reaffirmed) Term Loan 10 CRISIL D (Reaffirmed) MAPL has weak liquidity because of low cash accrual and large working capital requirement. It has modest scale of operations in a fragmented and competitive industry. However, the company benefits from the extensive experience of the promoters in the heavy fabrication industry, and its established customer relationships. Incorporated in 1985, MAPL fabricates pressure vessels, heat exchangers, storage tanks, and chemical gas cylinders mainly for the petroleum refining and chemicals industries. The company has manufacturing facilities in Noida (Uttar Pradesh) and is promoted by Mr. Ish Kumar Narang and family. NANDI POLYMERS: ICRA Suspends 'B' Rating on INR9.15cr FB Loan ------------------------------------------------------------- ICRA has suspended [ICRA]B rating assigned to the INR9.15 crore fund based facilities, INR0.20 crore non-fund based facilities and INR0.85 crore unallocated limits of Nandi Polymers India Private Limited. ICRA has also suspended [ICRA]A4 rating assigned to INR1.80 crore non-fund based facilities of NPIPL. The suspension follows ICRA's inability to carry out a rating surveillance in the absence of the requisite information from the company. Nandi Polymers India Private Limited was incorporated in 2005 as a private limited company. NPPL is a part of Nandi group of companies which has presence in PVC Pipes & Fittings, Cement, Ethanol and Infrastructure sectors etc. Nandi Polymers was in the business of manufacturing HDPE pipes since 2005. In 2009, the company added LLDPE water tanks and in 2014 it added HDPE water tanks to its product portfolio. NEC PACKAGING: CRISIL Assigns 'B' Rating to INR40MM Cash Loan ------------------------------------------------------------- CRISIL has revoked the suspension of its rating on the bank facilities of NEC Packaging Limited (NEC) and assigned its 'CRISIL B/Stable/CRISIL A4' ratings to the facilities. CRISIL had, on April 27, 2016, suspended the rating, as the firm had not provided adequate information for a rating review. It has now shared the requisite information, enabling CRISIL to assign a rating to the bank facilities. Amount Facilities (INR Mln) Ratings ---------- --------- ------- Cash Credit 40 CRISIL B/Stable (Assigned; Suspension Revoked) Letter of Credit 10 CRISIL A4 (Assigned; Suspension Revoked) The ratings reflect working capital intensive nature of business, modest scale of operations and low profitability. These rating weaknesses are mitigated by the extensive experience of promoter in the packaging paper industry and NEC's above-average financial risk profile because of moderate leverage and average debt protection metrics. Outlook: Stable CRISIL believes NEC will continue to benefit from the extensive industry experience of its promoter and its established relationship with customers. The outlook may be revised to 'Positive' in case the company generates significantly higher- than-expected cash accruals while maintaining working capital requirement prudently. Conversely, the outlook may be revised to 'Negative' in case of lower-than-expected cash accruals, large, debt-funded capital expenditure, or stretched working capital cycle. Incorporated in 1979, NEC manufactures packaging materials such as printed corrugated cartons, unprinted laminated films, blister foils and bulk drug bags, printed poly vinyl chloride shrink labels, and cold formed foils. It has its manufacturing unit in Mohali (Punjab) and is managed by Mr. Vivek Kumar Gupta. PERFECT ENGINEERS: CRISIL Reaffirms B+ Rating on INR60MM Loan ------------------------------------------------------------- CRISIL's ratings on the bank facilities of Perfect Engineers & Contractors (PEC) continues to reflect PEC's modest scale of operations in the fragmented civil construction industry, the geographic concentration in its revenue, and its large working capital requirements. Amount Facilities (INR Mln) Ratings ---------- --------- ------- Bank Guarantee 20 CRISIL A4 (Reaffirmed) Cash Credit 60 CRISIL B+/Stable (Reaffirmed) These rating weaknesses are partially offset by the extensive experience of PEC's promoters in the civil construction industry and the firm's moderate financial risk profile marked by comfortable debt protection metrics. Outlook: Stable CRISIL believes that PEC will continue to benefit over the medium term from its promoters' extensive industry experience. The outlook may be revised to 'Positive' if the firm scales up its operations significantly while improving its profitability, leading to substantial cash accruals and a better financial risk profile. Conversely, the outlook may be revised to 'Negative' if PEC reports low revenue or profitability, or if its working capital management deteriorates resulting in weak liquidity, or if it undertakes a large debt-funded capital expenditure programme, leading to weakening of its financial risk profile. Set up in 1993 as a partnership firm, PEC undertakes civil construction work, primarily buildings in Kerala. The firm is based in Palakkad (Kerala) and its day-to-day operations are managed by Mr. M. Suneel and Mr. Sajeevan. PEC reported a profit after tax (PAT) of INR3.2 million on revenue of INR8.02 million for 2014-15 (refers to financial year, April 1 to March 31), against a PAT of INR10.8 million on revenue of INR116.4 million for 2013-14. PRADHVI MULTITRADE: ICRA Suspends 'D' Rating on INR10cr Loan ------------------------------------------------------------ ICRA has suspended the [ICRA]D rating assigned to the INR10.00 crore fund based cash credit facility1 of Pradhvi Multitrade Private Limited. The suspension follows ICRA's inability to carry out a rating surveillance in the absence of the requisite information from the company. Incorporated on Feb. 26, 2011, Pradhvi Multitrade Private Limited (Pradhvi Multitrade) is a private limited company promoted by Mr. K. R. Menon and Mr. Rajpal Singh engaged in the trading of greige cloth. The company's administrative and registered office is in Mulund, Mumbai and it has two godowns in Bhiwandi. RAJGAD DNYANPEETH: CRISIL Suspends 'D' Rating on INR120MM Loan -------------------------------------------------------------- CRISIL has suspended its rating on the bank facilities of Rajgad Dnyanpeeth (Rajgad). Amount Facilities (INR Mln) Ratings ---------- --------- ------- Proposed Term Loan 102.5 CRISIL D Term Loan 120.0 CRISIL D The suspension of rating is on account of non-cooperation by Rajgad with CRISIL's efforts to undertake a review of the ratings outstanding. Despite repeated requests by CRISIL, Rajgad is yet to provide adequate information to enable CRISIL to assess Rajgad'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' Rajgad was set up in 1982 and is managed by Mr. Anantrao Thopate and his son Mr. Sangram Thopate. The trust manages multiple educational institutes such as primary and secondary schools, pharmacy and engineering colleges, management colleges, and arts and commerce colleges in Bhor. While the schools are affiliated to the Maharashtra State Board, the engineering institutes are affiliated to the All India Council for Technical Education, and the arts and commerce colleges are affiliated to the University of Pune. RAJKAMAL TEXTILES: CRISIL Reaffirms B+ Rating on INR50MM Loan ------------------------------------------------------------- CRISIL's ratings on the bank facilities of Rajkamal Textiles continues to reflect Rajkamal's modest scale of operations and susceptibility to volatility in raw material prices. These rating weaknesses are partially offset by the firm's moderate financial risk profile, marked by average gearing and debt protection metrics, and its promoters' extensive experience in the textile industry. Amount Facilities (INR Mln) Ratings ---------- --------- ------- Bank Guarantee 0.9 CRISIL A4 (Reaffirmed) Cash Credit 50.0 CRISIL B+/Stable (Reaffirmed) Outlook: Stable CRISIL believes that Rajkamal will continue to benefit over the medium term from the extensive industry experience of its promoters. The outlook may be revised to 'Positive' if the firm scales up its operations and generates more-than-expected cash accruals on a sustained basis, resulting in an improvement in its financial risk profile. Conversely, the outlook may be revised to 'Negative' if Rajkamal's capacities are under utilised, resulting in low cash flows, if the operating margin declines, or if it undertakes a large debt-funded capital expenditure programme, leading to deterioration in its financial risk profile. Set up in 2002 by Mr. C Rajendran and Mrs. C Nanjammal, Rajkamal manufactures grey melange yarn with counts ranging from 20s to 40s. It is based in Coimbatore in Tamil Nadu. REAL INNERSPRING: ICRA Reaffirms B+ Rating on INR3.25cr Loan ------------------------------------------------------------ ICRA has reaffirmed its long-term rating of [ICRA]B+ on the INR3.60 crore (reduced from INR5.50 crore) fund based bank facility of Real Innerspring Technologies Private Limited. ICRA has also reaffirmed its short-term rating of [ICRA]A4 on the INR0.50 crore non-fund based facility of the company. ICRA has also assigned its [ICRA]B+ rating to the INR1.90 crore unallocated bank facilities of RIPL. Amount Facilities (INR crore) Ratings ---------- ----------- ------- Cash Credit 3.25 [ICRA]B+; reaffirmed Term Loan 0.35 [ICRA]B+; reaffirmed Bank Guarantee 0.25 [ICRA]A4; reaffirmed Letter of Credit 0.25 [ICRA]A4; reaffirmed Unallocated 1.90 [ICRA]B+; assigned The rating reaffirmation takes into account the growth in RIPL's scale of operations, which, as per provisional results, increased to INR32.83 crore in FY 2016. ICRA also takes note of the decline in the operating margins and the net losses incurred by the company in FY2015, which have resulted in an increase in gearing. The rating continues to take into account the company's relatively moderate scale of operations, despite the growth registered in recent years, and the highly competitive and fragmented industry in which it operates. The mattress industry is characterized by the presence of a large number of participants, both organized and unorganized, on account of low entry barriers arising from low technical and capital intensity. RIPL faces competition from established players like Sleepwell, Springwell, Kurlon etc, as well as numerous small to medium sized enterprises which limits the pricing flexibility of the industry participants, including RIPL, leading to subdued profitability. Also, RIPL has a weak financial risk profile, which is likely to deteriorate further with the debt funded capital expenditure being incurred by the company in FY2017. However, ICRA positively takes into account the significant experience of the promoters of RIPL in the mattress trading business and the financial support provided by them to the company in the form of unsecured loans over the last years. Further, the company's agreement with 'King Koil', a major player in the international mattress market, is expected to help the company going forward, in terms of support in the form of technology sharing and branding. The growing consumer preference towards luxury products is likely to generate sufficient demand for the company's products over the medium to long term. The ability to increase its scale of operations, while improving its profitability, along with a sustained improvement in its capital structure will be the key rating sensitivities. Incorporated in 2004 by the Gupta family, RIPL manufactures foam and spring mattresses. The company commenced operations at its manufacturing unit in Noida, Uttar Pradesh in 2004. This was followed by the addition of manufacturing units in Rudarpur (Uttarakhand) and Bhiwandi (Maharashtra). The spring mattresses manufactured by RIPL are sold under the brand name 'Sleep Zone'. In 2013, the company acquired the manufacturing and marketing license from an international mattress manufacturing company, which markets its products under the brand name 'King Koil'. The directors of RIPL are Mr. Archit Gupta, Mr. Nitin Gupta and Mr. Shobit Gupta, who along with other professionals manage the affairs of the company. The promoters have been involved in the mattress trading business since the last four decades and are also involved in various other businesses, such as manufacturing of non-woven fabric and manufacturing of composite containers. SAMRADDHI COT: CARE Reaffirms B+ Rating on INR7.01cr LT Loan ------------------------------------------------------------ CARE revokes suspension and reaffirms the rating assigned to the bank facilities of Samraddhi Cot Fibres Private Limited. Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long term Bank Facilities 7.01 CARE B+ Suspension revoked and rating reaffirmed Rating Rationale The rating assigned to the bank facilities of Samraddhi Cot Fibres Private limited (SCFPL) continues to remain constrained on account of the net loss reported by the company during FY15 (refers to the period April 1 to March 31) coupled with leveraged capital structure, weak debt coverage indicators and elongated working capital cycle. The rating is further constrained due to susceptibility of profit margins to cotton price fluctuations, seasonality associated with the cotton industry and the company's presence in the highly fragmented cotton ginning and pressing industry with limited value addition resulting into working- capital intensive nature of operations. The rating continues to draw strength from the experience of the promoters in the cotton industry and location advantage in terms of proximity to the cotton seed growing regions inMadhya Pradesh. The rating also takes into account increase in the total operating income (TOI) during FY15. The ability of SCFPL to improve its profit margins, capital structure and better working capital management in light of the competitive nature of the industry remain the key rating sensitivities. SCFPL was incorporated in 2011 and commenced its operation from December 2012. SCFPL is promoted by Mr Prakash Mittal, and the company is engaged into the business of cotton ginning and pressing. SCFPL operates from its plant located in Sendhwa, Madhya Pradesh, with a capacity of processing raw cotton for producing 200 bales per day and is currently utilising 80% of its total capacity. SCFPL procures its raw cotton locally through brokers and mandis. Furthermore, duringMarch 2014, SCFPL set up warehouse facility for storage of cotton bales and cotton seeds. During FY15 (A), SCFPL reported a TOI of INR41.01 crore and Net loss of INR0.04 as against TOI of INR31.11 crore and PAT of INR0.14 crore during FY14 (A). During FY16 (Prov.), SCFPL has achieved TOI of around INR30 crore. SHREE GANESH: ICRA Suspends 'D' Rating on INR265.99cr Loan ---------------------------------------------------------- ICRA has suspended the [ICRA]D rating assigned to the INR265.99 crore long term loans & working capital facilities of Shree Ganesh Metaliks Ltd. 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. SHREE RAJ: ICRA Withdraws 'B' Rating on INR4.70cr Term Loan ----------------------------------------------------------- ICRA has withdrawn the rating of [ICRA]B assigned to the INR5.70 crore1 bank limits of Shree Raj Agro Cold storage, which were under notice of withdrawal. Amount Facilities (INR crore) Ratings ---------- ----------- ------- Term Loan 4.70 [ICRA]B (withdrawn) Cash Credit 1.00 [ICRA]B (withdrawn) The ratings are withdrawn as the period of notice of withdrawal is completed. SIDHIVINAYAK FILAMENTS: ICRA Suspends B/A4 Rating on INR47cr Loan ----------------------------------------------------------------- ICRA has suspended [ICRA]B/[ICRA]A4 ratings assigned to the INR47.00 crore fund based and non-fund based limits of Sidhivinayak Filaments Private Limited. The suspension follows ICRA's inability to carry out a rating surveillance in the absence of the requisite information from the company. SFPL is a manufacturer of texturized yarn and knitted fabrics. The company was established in 1998. The company operates 7 texturizing machines, 51 circular knitting machines and 6 warp knitting machines in its manufacturing facility located in Silvassa. The company is promoted and managed by the Bajari family. Bajari Filaments Private Limited, promoted by the Bajari family and in the same line of business, is a group company of Sidhivinayak Filaments Pvt. Ltd. SRI VANI: CRISIL Assigns 'B' Rating to INR10MM Cash Loan -------------------------------------------------------- CRISIL has assigned the 'CRISIL B/stable/CRISIL A4' ratings to the bank facilities of Sri Vani Trading and Co. (SVT). Amount Facilities (INR Mln) Ratings ---------- --------- ------- Cash Credit 10 CRISIL B/Stable Foreign Letter of Credit 50 CRISIL A4 The ratings reflect modest scale of operations in highly fragmented timber industry, working capital-intensive operations and susceptibility to fluctuations in foreign exchange rates. These weaknesses are mitigated by extensive industry experience of promoters. Outlook: Stable CRISIL believes SVT will maintain its stable business risk profile over the medium term backed by the extensive industry experience of its promoters and its established relationships with customers. The outlook may be revised to 'Positive' if ramp- up in scale of operations along with improvement in profitability results in improved capital structure. Conversely, the outlook may be revised to 'Negative' if liquidity weakens due to large incremental working capital requirement, declined margins or large, debt-funded capital expenditure programme or in any change in government policy negatively impacts operations. Incorporated in 2008, as a partnership firm by Mr. Marimuthu and Mr. Inbaraj, SVT trades imported timber in Thenkasi, Tamil Nadu. The daily operations are managed primarily by Mr. Marimuthu. Net profit was INR0.67 million for 2014-15 (refers to financial year, April 1 to March 31) on net sales of INR189 million, as against net profit of INR0.55 million on net sales of INR156 million in 2013-14. Revenue was estimated at INR208 million for 2015-16. SUPREME EXPORTS: CARE Assigns 'B' Rating to INR5.0cr LT Loan ------------------------------------------------------------ CARE assigns 'CARE B' rating to the bank facilities of Supreme Exports. Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long-term Bank Facilities 5.0 CARE B Assigned Rating Rationale The rating assigned to the bank facilities of Supreme Exports (SE) is constrained by the relatively small scale of operations coupled with fluctuating profitability margins, weak debt coverage indicators, elongated operating cycle, competitive nature of industry, regulatory risk and seasonality associated with the seafood industry and constitution of the entity as a partnership firm. However, the rating is underpinned by the established track record and experience of the partners for three decades in sea food industry, satisfactory capital structure, location advantage and regulatory approvals in place. The ability of the firm to improve its scale of operations and profitability margins in the competitive market and improve its debt coverage indicators are the key rating sensitivities. Supreme Exports (SE) was established in the year 2000 and has been promoted by Mr SHV Prasad and his wife Ms S Rama Sita. The firm is engaged in processing, packing and export of shrimp to various places like Vietnam, China and Dubai. The product profile of the firm includes black tiger, vannamei, scamp and white shrimp. The plant has the certification of 'Hazard Analysis Critical Control Point (HACCP)', British Retail Consortium (BRC).The processing and storage facilities of SE are approved by the Marine Products Export Development Authority (MPEDA). During FY15 (refers to the period April 1 to March 31), SE reported a PAT of INR0.01 crore on a total operating income of INR9.64 crore as against PAT of INR0.1 crore on a total operating income of INR9.67 crore in FY14. Furthermore, during 11MFY16 (Provisional), the firm has achieved sales of INR18.92 crore. SURYODAYA INFRA: ICRA Suspends B+ Rating on INR4.0cr Loan --------------------------------------------------------- ICRA has suspended [ICRA]B+ rating assigned to the INR4.00 crore fund based facilities and INR4.50 crore non-fund based facilities of Suryodaya Infra Projects (I) Private Limited. The suspension follows ICRA's inability to carry out a rating surveillance in the absence of the requisite information from the company. The business was started as a partnership -- Prime Construction (PC) in 2006. SIPIL was incorporated on 30th December 2008 and commenced operations in May 2009. PC which was engaged in the same business was merged with SIPIL in 2010 The company is engaged in civil works for National Mineral Development Corporation (NMDC), like site clearance, area grading, raising of tailing dam embankment, road construction, construction of conveyor belts, etc. TOP GEAR: CRISIL Reaffirms B+ Rating on INR47.8MM LT Loan --------------------------------------------------------- CRISIL's ratings on the bank facilities of Top Gear Transmission Private Limited (TGTPL; part of the TG group) continue to reflect TG group's modest scale, and working-capital-intensive operations in the highly competitive industry. Amount Facilities (INR Mln) Ratings ---------- --------- ------- Bank Guarantee 7.5 CRISIL A4 (Reaffirmed) Cash Credit 20 CRISIL B+/Stable (Reaffirmed) Letter of Credit 15 CRISIL A4 (Reaffirmed) Long Term Loan 9.7 CRISIL B+/Stable (Reaffirmed) Proposed Long Term Bank Loan Facility 47.8 CRISIL B+/Stable (Reaffirmed) The ratings also factor in the group's modest networth and moderately high gearing. These weaknesses are partially offset by the promoters' extensive experience in the gearbox manufacturing industry and its healthy profitability leading to moderate debt- protection metrics. For arriving at the ratings, CRISIL has combined the business and financial risk profiles of TGTPL and Top Gear Transmissions (TGT), together referred to as the TG group, on account of significant operational and financial linkages between the two. Outlook: Stable CRISIL believes the TG group will continue to benefit from the promoters' extensive experience and funding support. The outlook may be revised to 'Positive' if there is higher-than-expected cash accrual along with efficient working capital management. The outlook may be revised to 'Negative' if operating margin declines or stretch in working capital cycle or large, debt-funded capital expenditure weaken the financial risk profile. Update Revenues during 2015-16 (refers to financial year, April 1 to March 31) have remained stagnant with net sales of INR361 million as against INR356 million during the previous year amidst muted demand. The profitability was in line with the previous year at around 13 percent. TG group's operations remained working capital intensive with estimated gross current assets of 225 days increasing from 203 days in previous year leading to high bank limit utilisation of around 90 percent over the past twelve months through December 2015. Financial risk profile is marked by modest estimated networth of INR78.1 million and moderately high gearing of 1.7 times as on March 31, 2016. The interest coverage and net cash accrual/ total debt were moderate at 2.8 times and 0.17 times, respectively for 2015-16. TG group is expected to generate cash accrual of INR25- 30 million, which shall be sufficient for annual debt repayments of INR16-20 million over the next two years. It was also supported by promoter funding support of INR24 million as on March 31, 2016. TGT was incorporated in 2002 in Satara (Maharashtra) by Mr. Srikanth Pawar. Reconstituted as a closely held public limited company in 2002, it designs and manufactures planetary gear boxes as well as custom built gear boxes used in capital goods industry. TGTPL, incorporated in 2002 in Satara by Mr. Shashikant B Pawar, manufactures heavy-built gear boxes used in capital goods industry. TRIVENI WIRES: ICRA Assigns 'B' Rating to INR25.0cr Loan -------------------------------------------------------- ICRA has assigned a long-term rating of [ICRA]B to the INR25.00 crore term loan, INR2.50 crore cash credit limit and INR7.75 crore unallocated limits of Triveni Wires Pvt. Ltd. ICRA has also assigned a short-term rating of [ICRA]A4 to the INR1.75 crore non-fund based bank facilities and to the INR5.00 crore non fund based sublimit of the company. Amount Facilities (INR crore) Ratings ---------- ----------- ------- Fund Based Limits Term Loan 25.00 [ICRA]B; assigned Cash Credit 2.50 [ICRA]B; assigned Unallocated 7.75 [ICRA]B; assigned Non Fund Based Limits Letter of Credit 1.25 [ICRA]A4; assigned Bank Guarantee 0.50 [ICRA]A4; assigned Capex LC/BC (5.00) [ICRA]A4; assigned The assigned ratings take into account the company's small scale of current operations, although healthy scaling up of operations is witnessed in the last two fiscals. ICRA takes note of the company's weak financial risk profile as reflected in a low profitability, modest cash accruals, weak coverage indicators and leveraged capital structure. Furthermore, the ongoing large capital expenditure program (capex) of the company to enhance its production capacity exposes TWPL to project execution risks, given the existing time and cost overruns in the project. Moreover, TWPL will be undertaking large external borrowing to fund the capex which is likely to impinge on the debt servicing capabilities of the company in the short term. The ratings also take into consideration the vulnerability of the company's margins to fluctuations in the prices of its key raw materials like steel and zinc, limited value addition in its business, the intense competition due to the fragmented nature of the industry and TWPL's low bargaining power against its established customers. The rating, however, draws comfort from the vast experience of the promoters in the field of wire drawing industry and the large capacity augmentation to ramp up scale of operation in near term. ICRA also notes, TWPL's long standing tie up with TSL as an EPA, which ensures utilisation of the increased capacity with a continuous flow of orders. ICRA expects a significant growth of 80-100% in TWPL's revenues from FY2017 as a result of the expected augmentation in the capacity and product diversification. The OI of the company is expected to increase by 80% in FY2017 assuming ~40% utilization and further by 100% in FY2018 assuming ~70% utilization of the total capacity of 37200 MTPA. While the company is expected to make profits at operating level in FY2017, losses would be incurred at net level as a result of high interest and depreciation expenses. In the near term, the company's ability to ramp up the scale of operations backed by optimum utilization of augmented capacity will lead to improvement in profit metrics and accruals in the business which will be critical for timely servicing debt obligation and hence will be the key rating sensitivities. Incorporated in the year 1981, Triveni Wires Private Limited (TWPL) is involved in the business of wire drawing from wire rods and galvanizing of wires. Directors, Mr. Premkumar Tekriwal, Mr. Arunkumar Tekriwala and Mr. Ramakanth Tekriwala who have experience in the wire drawing industry, manage the company. TWPL has a factory in Higna district of Nagpur with an installed capacity of 12000 MTPA and is setting up an additional unit in M.I.D.C. Butibori, Nagpur with an installed capacity of 37200 MTPA. TWPL has two group companies namely Tensile Wires Pvt. Ltd. Plasma Metal Processing Pvt. Ltd., which are engaged in a similar line of business. UMIYA ENTERPRISE: ICRA Assigns 'B+' Rating to INR5.89cr LT Loan --------------------------------------------------------------- The long-term rating of [ICRA]B+ has been assigned to the INR5.89 crore1 term loan facility, the INR4.00 crore cash credit facility and the INR2.61 crore unallocated limits of Umiya Enterprise. Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long term fund based-Term Loans 5.89 [ICRA]B+ assigned Long term fund based- Cash Credit 4.00 [ICRA]B+ assigned Unallocated Limits 2.61 [ICRA]B+ assigned The assigned rating is constrained by the small scale of operations of the firm as well as a weak financial risk profile characterised by thin profitability in the early stage of operations, weak return indicators, leveraged capital structure and moderate debt coverage indicators. The rating also takes into account the vulnerability of profitability to any changes in raw cotton linked prices of cotton yarn, cyclicality inherent in the textile industry and the high level of competition due to high fragmentation. ICRA also notes that UE is a partnership firm; any substantial withdrawal would adversely affect its net worth and thereby its capital structure. The rating, however, favourably factors in the long established experience of partners in the textile industry and location advantage due to its proximity to raw material sources and fabric processing units. Umiya Enterprise (UE) was established in July 2012 as a partnership firm to undertake weaving of yarn into grey fabric. The firm has established a weaving unit with 24 looms in Kalol, Gandhinagar in Gujarat with an installed capacity of producing 27 lakh metre of grey fabric per annum with operations commencing from August 2014. The partners have extensive experience in the textile industry through their former association with several entities engaged in the same line of business. Recent Results During FY2015 (8 months of operations), the firm reported an operating income of INR8.94 crore and net loss of INR2.20 crore. Further during FY2016, the firm reported an operating income of INR23.64 crore and net loss of INR0.23 crore (as per provisional financials). VANGILI FEEDS: CRISIL Cuts Rating on INR162.1MM Term Loan to B+ --------------------------------------------------------------- CRISIL has downgraded its rating on the long-term bank facility of Vangili Feeds (VF) to 'CRISIL B+/Stable' from 'CRISIL BB- /Stable'. Amount Facilities (INR Mln) Ratings ---------- --------- ------- Term Loan 162.1 CRISIL B+/Stable (Downgraded from 'CRISIL BB-/Stable') The downgrade reflects CRISIL's belief that VF's operating performance, essentially its scale operations will remain modest over the medium term given the continued sluggishness in the poultry industry as reflected in decline in realisation of broiler birds. Delay in commencement of its poultry feed facility and lower than expected realisation in the broiler bird segment had impacted the operating performance; VF reported lower than expected revenue during 2015-16 (refers to financial year, April 1 to March 31) leading to lower net cash accruals. CRISIL believes that the timely commencement of operations from the incremental poultry feed manufacturing capacity and its ability to scale up of operations, while maintaining its profitability and net cash accruals would remain the key rating sensitivity factors over the medium term. The rating reflects VF's moderate scale of operations in the fragmented poultry industry, weak operating efficiencies, and its modest financial risk profile marked by weak capital structure and modest debt protection metrics. These weaknesses are partially offset by extensive industry experience of partners, and longstanding relationships with suppliers and customers. Outlook: Stable CRISIL believes that VF will continue to benefit over the medium term from its established customer relations and the partner's extensive industry experience. The outlook may be revised to 'Positive' if revenue and profitability increase substantially, leading to better financial risk profile, or if partners infuse significant capital, resulting in improved capital structure. Conversely, the outlook may be revised to 'Negative' if the firm undertakes aggressive, debt-funded expansions, or if revenue and profitability decline sharply, or if there are larger-than- expected withdrawals by partners, leading to deterioration in financial risk profile. VF, established in 1989 as a partnership firm and based in Namakkal, Tamil Nadu, rears broiler birds (through contract farming), manufactures poultry feed, and trades in eggs. It is managed by Mr. V Subramaniam and his wife Ms. Selvi Subramaniam. For 2015-16, VF is estimated to report a profit after tax (PAT) of INR4 million on net sales of INR2.6 billion against net loss of INR65 million on net sales of INR2.1 billion for 2014-15. VASAVI NIRMAAN: CRISIL Cuts Rating on INR75MM LT Loan to 'B' ------------------------------------------------------------ CRISIL has downgraded its rating on the long-term bank facilities of Vasavi Nirmaan Private Limited (Vasavi Nirmaan) to 'CRISIL B/Stable' from 'CRISIL B+/Stable'. Amount Facilities (INR Mln) Ratings ---------- --------- ------- Long Term Loan 75 CRISIL B/Stable (Downgraded from 'CRISIL B+/Stable') Proposed Long Term 5 CRISIL B/Stable (Downgraded Bank Loan Facility from 'CRISIL B+/Stable') The residential project at Kundan Bagh, Hyderabad, has been delayed due to pending approvals for the revised scope of the project. The company has already invested INR130 million in the said project with no bookings done as approvals for the revised scope of project is yet to be received. The change in the scope of project is likely to result in escalation in the project cost thereby exposing the company to funding risk. Furthermore, the commercial project at Ameerpeth, Hyderabad is at initial stage of construction with nominal bookings. The rating also reflects Vasavi Nirmaan's exposure to funding, implementation, and demand risks associated with ongoing projects, accentuated by the early stage of project implementation. The rating also factors in high degree of geographical concentration in revenue profile and vulnerability to cyclicality inherent in the Indian real estate industry. These rating weaknesses are partially offset by the benefits that Vasavi Nirmaan derives from the extensive experience of its promoters in the real estate industry. Outlook: Stable CRISIL believes Vasavi Nirmaan will benefit over the medium term from the extensive industry experience of its promoters. The outlook may be revised to 'Positive' in case of significant booking of units and receipt of customer advances for its ongoing projects, leading to better-than-expected cash flow and liquidity. Conversely, the outlook may be revised to 'Negative' in case of weak liquidity, either because of lower-than-expected customer advances or significant cost overrun in ongoing projects. Vasavi Nirmaan was set up in 2013, by Mr. Yarram Vijay Kumar, Mr. S Rajamouli, Mr. P Venkateshwaralu, and Mr. Raju Aggarwal. The company is a real estate developer, and is currently developing: one residential project, two commercial projects, and one residential-cum-commercial project ' in Hyderabad. VERTICE GLOBAL: CRISIL Assigns B- Rating to INR119MM LT Loan ------------------------------------------------------------ CRISIL has assigned its 'CRISIL B-/Stable' rating to the long term bank facilities of Vertice Global Private Limited (VGPL) Amount Facilities (INR Mln) Ratings ---------- --------- ------- Proposed Long Term Bank Loan Facility 1 CRISIL B-/Stable Cash Credit 20 CRISIL B-/Stable Long Term Loan 119 CRISIL B-/Stable The rating reflects VGPL's modest scale of operation, its limited product diversification and its susceptibility to intense competition in the competitive Double Edged Blades (DE Blades) segment. These rating weaknesses are partially offset by the benefits that the company derives from its promoters' extensive industry experience and healthy demand prospects in export markets. Outlook: Stable CRISIL believes that VGPL will continue to benefit over the medium term from its promoters' extensive industry experience. The outlook may be revised to 'Positive' if VGPL generates more- than-expected revenues and profits, after stabilising its operations. Conversely, the outlook may be revised to 'Negative' in case the company 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. Incorporated in 2014, VGPL is engaged in manufacturing DE Blades. Based out of Hyderabad (Telangana), VGPL is promoted by Mr. Pabba Purushotham and Mr. Boddupalli Sai Teja. VINAYAGA IMPEX: CRISIL Lowers Rating on INR45MM Loan to 'D' ----------------------------------------------------------- CRISIL has downgraded its ratings on the bank facilities of Vinayaga Impex Private Limited (VIPL) to 'CRISIL D/CRISIL D' from 'CRISIL B+/Stable/CRISIL A4'. Amount Facilities (INR Mln) Ratings ---------- --------- ------- Cash Credit 34 CRISIL D (Downgraded from 'CRISIL B+/Stable') Export Bill 45 CRISIL D (Downgraded from Rediscounting 'CRISIL A4') Inland/Import 2.5 CRISIL D (Downgraded from Letter of Credit 'CRISIL A4') Overdraft Facility 25 CRISIL D (Downgraded from 'CRISIL B+/Stable') Packing Credit 25 CRISIL D (Downgraded from 'CRISIL A4') Proposed Long Term 13.9 CRISIL D (Downgraded from Bank Loan Facility 'CRISIL B+/Stable') Term Loan 4.6 CRISIL D (Downgraded from 'CRISIL B+/Stable') The rating downgrade reflects recent delays in servicing of interest of term loan availed by more than 90 days. The ratings reflect VIPL's below-average financial risk profile and working capital intensive nature of operations. These weaknesses are partially offset by the extensive experience of the promoters in the textile business and established customer relationships. Started in 2003, VIPL is a Delhi-based company that manufactures garments and fabrics. It is managed by Mr. B M Arora, Mr. Arjun Dev, and Mr. Pradeep Nanda. Its manufacturing unti is based in Ludhiana (Punjab). ==================== N E W Z E A L A N D ==================== REYNOLDS GROUP: S&P Revises Outlook to Pos. & Affirms 'B' CCR ------------------------------------------------------------- S&P Global Ratings said that it has revised its outlook on New Zealand-based packaging producer Reynolds Group Holdings Ltd., Beverage Packaging Holdings (Luxembourg) I S.A., Beverage Packaging Holdings (Luxembourg) II S.A., and Pactiv Corp. to positive from stable and affirmed its 'B' corporate credit rating on the company. At the same time, S&P assigned Reynolds Group Issuer Inc., Reynolds Group Issuer LLC, and Reynolds Group Issuer (Luxembourg) S.A.'s proposed $2.1 billion senior secured notes a 'B+' issue rating, with a recovery rating of '2', indicating S&P's expectation of substantial (70%-90%) recovery for lenders in the event of a payment default. Due to the increase in secured debt on a pro forma basis, the implied recovery for the senior secured notes is now in the lower half of the 70%-90% range, compared with the higher half previously. In addition, S&P assigned Reynolds Group Issuer Inc., Reynolds Group Issuer LLC, and Reynolds Group Issuer (Luxembourg) S.A.'s proposed $800 million senior unsecured notes a 'CCC+' issue rating, with a recovery rating of '6', indicating S&P's expectation of negligible (0%-10%) recovery in the event of a default. "The outlook revision reflects the prospects for a sustainable reduction in Reynolds' very high leverage," said S&P Global credit analyst Steven Mcdonald. Today's announced issuance will raise approximately $3 billion, which the company intends to use, along with approximately $879 million in cash, to redeem roughly $3.8 billion of existing debt. The transaction will reduce Reynolds' debt levels and future interest expense because of the lower coupon rates. The positive outlook indicates that there is at least a one-in- three likelihood that S&P may raise the ratings over the next 12 months. In S&P's base case, it assumes leverage will decline to between 6.5x and 7.0x through 2017, from currently very high levels, on the back of debt repayment and stable operating performance. Reynolds should generate free cash flow over this period and S&P will monitor the company's ability and willingness to deleverage, which could support an upgrade. S&P could raise the ratings if Reynolds continues to deleverage. A total adjusted debt to EBITDA metric of 6.5x or better, and the company's clear willingness to sustain credit measures at these levels, would support an upgrade. In S&P's view, repayment of additional near-term debt maturities instead of refinancing them could be one indication of such willingness. S&P could revise the outlook to stable if the company pursues a more aggressive financial policy that, in S&P's view, is likely to meaningfully delay progress in deleveraging. For instance, this could occur if the company were to make large acquisitions or shareholder distributions. ==================== S O U T H K O R E A ==================== DAEWOO SHIPBUILDING: Audit Agency Finds KRW1.5TT in Acctg Fraud --------------------------------------------------------------- Yonhap News Agency reports that South Korea's state audit agency said June 15 it has detected accounting fraud worth KRW1.5 trillion (US$1.27 billion) at Daewoo Shipbuilding & Marine Engineering Co., adding that its main creditor also failed to provide appropriate surveillance and management of the firm. Yonhap relates that South Korea's Board of Audit and Inspection (BAI) said Daewoo Shipbuilding's management also carried out business projects without legitimate procedures, which caused its financial losses to snowball. The shipbuilder posted an operating loss of KRW5.5 trillion last year, the report notes. While Korea Development Bank (KDB) was obligated to conduct inspections on the management of Daewoo Shipbuilding, the main creditor did not conduct the necessary investigation, Yonhap says. The BAI said its own study shows the shipbuilding company held the most risky grade of five, Yonhap relays. Yonhap relates that the BAI added that Daewoo Shipbuilding overestimated its operating profit in 2013 and 2014 by KRW44 billion and KRW1.09 trillion, respectively. The agency also pointed out that Daewoo Shipbuilding handed out incentives despite its lackluster earnings report, adds Yonhap. Yonhap notes that while the company decided to provide each employee with KRW9.46 million on average as incentives last year, KDB did not make take action despite the on-going financial losses. As a result, the company paid out incentives worth KRW87.7 billion, Yonhap says. According to Yonhap, the latest crisis from Daewoo Shipbuilding emerged as one of the major drags on the South Korean economy, as the shipbuilding industry has been one of the major growth engines for the country. Politicians also have been eying the issue as the crisis is feared to spark massive layoffs at the shipyard as well as its subcontractors, the report adds. Headquartered in Seoul, South Korea, Daewoo Shipbuilding & Marine Engineering Co. -- http://www.dsme.co.kr/-- is engaged in building ships and offshore structures. Its product portfolio includes commercial ships, such as liquefied natural gas (LNG) carriers, oil tankers, containerships, liquefied petroleum gas (LPG) carriers, pure car carriers; offshore structures, such as FPSO vessels, drilling rigs, drillships and fixed platforms, and naval vessels, including submarines, destroyers, rescue ships and patrol boats. ********* 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 ***