/raid1/www/Hosts/bankrupt/TCRAP

/raid1/www/Hosts/bankrupt/TCRAP_Public/160727.mbx T R O U B L E D C O M P A N Y R E P O R T E R A S I A P A C I F I C Wednesday, July 27, 2016, Vol. 19, No. 147 Headlines A U S T R A L I A ARTENERGY PTY: First Creditors' Meeting Slated For Aug. 3 ASPENGLOW PTY: Placed into Liquidation BESPOKE HOSPITALITY: First Creditors' Meeting Set For Aug. 2 EDWARDS BENEFITS: License Canceled Due Failure to File Statements ESSELLARR CONTRACTING: First Creditors' Meeting Set For Aug. 2 GUVERA AUSTRALIA: Facebook, Tennis Australia Listed as Creditors INTERSTAR MILLENNIUM: Fitch Affirms 'Bsf' Rating on Cl. B Notes L & L ADAMS: First Creditors' Meeting Scheduled For Aug. 2 PRODUCTION PRINTING: First Creditors' Meeting Set For Aug. 3 C H I N A CHINA OIL: S&P Revises Outlook to Positive & Affirms 'BB' CCR KU6 MEDIA: Suspending Filing of Reports with SEC I N D I A ALLIED MEDICAL: Ind-Ra Assigns 'IND BB' Long-Term Issuer Rating ANIL SANTHOSH: CRISIL Assigns B+ Rating to INR10MM LT Loan BOSTIN ENGINEERS: Ind-Ra Suspends 'IND D' Long-Term Issuer Rating CASTINGS INDIA: Ind-Ra Assigns 'IND B+' Long-Term Issuer Rating DACSS GRANITES: CRISIL Lowers Rating on INR65MM LT Loan to 'B' DEE-TECH PROJECTS: Ind-Ra Suspends 'IND BB' LT Issuer Rating DEVDHAR RICE: Ind-Ra Suspends 'IND B-' Long-Term Issuer Rating DLECTA FOODS: CRISIL Reaffirms B+ Rating on INR147MM Term Loan EARTH STAHL: CARE Reaffirms 'D' Rating on INR19.65cr LT Loan EMSON GEARS: CRISIL Lowers Rating on INR647.1MM Loan to 'B+' G. T. HOMES: CRISIL Reaffirms B+ Rating on INR230MM Term Loan GAJRAJ HOTELS: CARE Ups Rating on INR18.03cr LT Loan to 'C' GINGER INFRASTRUCTURE: CARE Assigns B+ Rating to INR15cr LT Loan GODAWARI POWER: CARE Lowers Rating on INR1,110.21cr Loan to 'D' HARITHA BIO: Ind-Ra Suspends 'IND D' Long-Term Issuer Rating HYDRAULIC ENGINEERS: Ind-Ra Cuts LT Issuer Rating to 'IND B+' INDICON CONSTRUCTION: CRISIL Reaffirms B Rating on INR39MM Loan JAYARAJ INTERNATIONAL: CRISIL Reaffirms B+ Rating on INR50MM Loan JUGAL KISHORE: CARE Reaffirms B+ Rating on INR9cr LT Loan KALPATARU COLD: Ind-Ra Suspends IND D' Long-Term Issuer Rating KAVYA COLD: CARE Assigns B+ Rating to INR5.28cr LT Bank Loan KAY EM COPPER: Ind-Ra Suspends 'IND BB-' Long-Term Issuer Rating KIZHAKKEBHAGATHU RICE: CRISIL Cuts Rating on INR60MM Loan to C KPM PROCESSING: Ind-Ra Upgrades LT Issuer Rating to 'IND BB' KRISHNA GRUH: CRISIL Suspends 'B' Rating on INR30MM Term Loan KYS MANUFACTURERS: CARE Assigns B+ Rating to INR13.13cr LT Loan LAGU BANDHU: Ind-Ra Assigns 'IND BB' Long-Term Issuer Rating LAKSHMI TRADERS: CRISIL Suspends B Rating on INR50MM Cash Loan LINUS PROCESSORS: Ind-Ra Suspends 'IND BB-' LT Issuer Rating M C SPINNERS: Ind-Ra Suspends 'IND D' Long-Term Issuer Rating M.S. COLD: Ind-Ra Suspends IND BB-' Long-Term Issuer Rating MANNA RICE: CRISIL Assigns 'B' Rating to INR57.5MM LT Loan MATRIX ROLLER: Ind-Ra Suspends 'IND B' Long-Term Issuer Rating MINAKSHI COTEX: CRISIL Reaffirms B+ Rating on INR100MM Cash Loan MULPURI FOODS: CRISIL Upgrades Rating on INR620MM Loan to 'B' MULPURI POULTRIES: CRISIL Ups Rating on INR150MM Cash Loan to B NANDRAJ RICE: Ind-Ra Suspends 'IND B-' Long-Term Issuer Rating NARMADA SPINNING: CRISIL Raises Rating on INR200MM Loan to B+ NAROL TEXTILE: CRISIL Assigns B+ Rating to INR624.8MM Term Loan OSHO FORGE: CRISIL Lowers Rating on INR400MM Cash Loan to B+ P. K. INDUSTRIES: CARE Upgrades Rating on INR4cr Loan to BB- PARAMOUNT SEAFOODS: CRISIL Reaffirms B+ Rating on INR25MM Loan PAREKH ALUMINEX: CRISIL Reaffirms D Rating on INR8.55BB Loan PRIME URBAN: CRISIL Puts 'B' Rating on Notice of Withdrawal R V PLASTIC: Ind-Ra Suspends 'IND B+' Long-Term Issuer Rating RAJ SALT: CARE Upgrades Rating on INR4.40cr LT Loan to BB- RATTAN LAL: CRISIL Suspends 'D' Rating on INR195MM Term Loan SABOO TOR: Ind-Ra Suspends 'IND BB' Long-Term Issuer Rating SAHA BUILDING: CRISIL Reaffirms B+ Rating on INR40MM Cash Loan SAI MAATARINI: Ind-Ra Suspends 'IND BB' Term Loan Facility Rating SANTOSHI RICE: CARE Reaffirms B+ Rating on INR5.80cr LT Loan SATIJA MOTORS: CRISIL Assigns B+ Rating to INR45MM Cash Loan SHREE BALAJI: CARE Assigns B- Rating to INR4.80cr LT Loan SHREE MORAYA: CRISIL Assigns B+ Rating to INR60MM Term Loan SMS INTERNATIONAL: CRISIL Reaffirms B+ Rating on INR48.8MM Loan SORENTO GRANITO: CARE Reaffirms B+ Rating on INR2.04cr LT Loan SRI DHARAM: CRISIL Cuts Rating on INR145MM LT Loan to 'D' SRI VENKATESWARA: CRISIL Upgrades Rating on INR234.8MM Loan to B SUNFAME CERAMIC: CARE Assigns B+ Rating to INR5.86cr LT Loan SWAGATTAM PLASTIC: Ind-Ra Suspends IND B+ Long-Term Issuer Rating T. S. JAYAPRAKASH: CRISIL Reaffirms 'B' Rating on INR46.5MM Loan TRIPATHI HOSPITAL: CRISIL Ups Rating on INR200MM Term Loan to B+ VED CELLULOSE: Ind-Ra Suspends 'IND BB' Long-Term Issuer Rating WILSON PRINTCITY: CRISIL Reaffirms 'B' Rating on INR47.5MM Loan J A P A N KAWASAKI KISEN: Egan-Jones Assigns B Sr. Unsecured Debt Ratings MARUI GROUP: Egan-Jones Assigns BB+ Sr. Unsecured Debt Ratings MITSUI ENGINEERING: Egan-Jones Assigns BB Sr. Unsec. Debt Ratings MITSUI OSK: Egan-Jones Assigns B Sr. Unsec. Debt Ratings SHOWA SHELL: Egan-Jones Assigns B Sr. Unsecured Debt Ratings SOFTBANK GROUP: Egan-Jones Assigns BB FC Sr. Unsec. Debt Rating TOKYO DOME: Egan-Jones Assigns BB- Sr. Unsecured Debt Rating UNITIKA LTD: Egan-Jones Assigns B Sr. Unsecured Debt Rating M A L A Y S I A 1MALAYSIA: Singapore Vows More 'Intrusive' Bank Probes 1MALAYSIA: Goldman Sachs Under Spotlight in 1MDB Scandal N E W Z E A L A N D BELLA'S CAFE: Closes After Two Decades in Business T A I W A N ACER INC: Egan-Jones Hikes Sr. Unsecured Debt Ratings to B- JIH SUN: Fitch Affirms 'BB+' LT FC Issuer Default Ratings YUANTA COMMERCIAL: Fitch Assigns 'BB+' Support Rating Floor - - - - - ================= A U S T R A L I A ================= ARTENERGY PTY: First Creditors' Meeting Slated For Aug. 3 --------------------------------------------------------- Richard Albarran of Hall Chadwick was appointed as administrator of Artenergy Pty Ltd on July 22, 2016. A first meeting of the creditors of the Company will be held at Chartered Accountants Australia and New Zealand, Level 9, Lawson and Wentworth Rooms, 33 Erskine Street, in Sydney, on Aug. 3, 2016, at 11:30 a.m. ASPENGLOW PTY: Placed into Liquidation -------------------------------------- Cliff Sanderson at Dissolve.com.au reports that Aspenglow Pty Ltd has collapsed into liquidation. Richard Hughes and Timothy Heenan of Deloitte Touche Tohmatsu have been appointed liquidators of the company. Dissolve.com.au says the liquidation comes after the company was reportedly unable to pay AUD22 million to BGP Geoexplorer. Aspenglow, previously named Palmer Petroleum, hired BGP in 2010 to survey the petroleum prospective licences of Palmer Petroleum in the Gulf of Papua and offer a report, Dissolve.com.au discloses. The liquidators are tasked to chase the debtors of Palmer Petroleum for creditors. Clive Palmer is the company`s only director, Dissolve.com.au notes. BESPOKE HOSPITALITY: First Creditors' Meeting Set For Aug. 2 ------------------------------------------------------------ Brendan Nixon of Stanley Morgan Solvency Accountants was appointed as administrator of Bespoke Hospitality Group Pty Ltd, trading as Aunty Oh's, on July 22, 2016. A first meeting of the creditors of the Company will be held at Level 8/490 Upper Edward Street, Spring Hill, in Queensland, on Aug. 2, 2016, at 2:00 p.m. EDWARDS BENEFITS: License Canceled Due Failure to File Statements ----------------------------------------------------------------- Australian Securities and Investments Commission has cancelled the Australian financial services (AFS) licence of Sydney-based Edwards Benefits Advisors Pty Ltd for failing to comply with a number of key obligations as a financial services licensee. In particular, ASIC found that Edwards Benefits: * failed to lodge financial statements, auditors reports and auditor opinions over consecutive years; and * failed to advise ASIC in writing, within 10 business days, of becoming aware of this significant breach. ASIC cancelled Edwards Benefits' AFS licence on June 29, 2016. Edwards Benefits has the right to appeal to the Administrative Appeals Tribunal for a review of ASIC's decision. Edwards Benefits had been operating since 1999 and was authorised to provide general financial product advice in relation to superannuation, investment, and life and disability insurance to Australian retail clients. The annual lodgement of audited accounts is an important part of a licensee demonstrating its capacity to provide financial services. ASIC will continue to contact AFS licensees which have not lodged audited financial statements and take appropriate action if they fail to lodge these statements. ESSELLARR CONTRACTING: First Creditors' Meeting Set For Aug. 2 -------------------------------------------------------------- Gavin Moss and James McPherson of Chifley Advisory were appointed as administrators of Essellarr Contracting Pty Ltd on July 21, 2016. A first meeting of the creditors of the Company will be held atthe Boardroom of Chifley Advisory, Level 3, 39 Martin Place, in Sydney, on Aug. 2, 2016, at 11:00 a.m. GUVERA AUSTRALIA: Facebook, Tennis Australia Listed as Creditors ---------------------------------------------------------------- Liam Walsh at The Courier-Mail reports that Tennis Australia, the Victoria Racing Club and Australian musicians have been caught out for hundreds of thousands of dollars after music-streaming outfit Guvera placed two subsidiaries in administration. US giant Facebook and small Australian advertising and technology businesses are also named on a creditors list of firms and people owed money by Gold Coast-based Guvera, the report says. Guvera, which boasts a catalogue of 30 million songs, last month placed subsidiaries Guvera Australia and Guv Services in administration, owing almost AUD15 million. The Courier-Mail relates that the move came after the ASX blocked Guvera's plans for a stockmarket listing. Guvera, which plans to offer a free service with advertisers paying the bill, planned to raise up to AUD100 million in that float. As previously reported, almost 70 staff have lost jobs and say they are owed outstanding superannuation and redundancy pay. Directors including Guvera chief executive officer Darren Herft and co-founder Claes Loberg are also listed in the meeting register, but it is not clear if they are creditors. Fellow co- founder Brad Christiansen is another name on the list; he last week resigned from the main Guvera's board, The Courier-Mail says. According to The Courier-Mail, creditor minutes stated that APRA AMCOS, the Sydney-based body handles royalties for musicians, was owed AUD928,712. Tennis Australia was owed AUD285,000. The Courier-Mail says Guvera had a deal with Tennis Australia this year for the Australian Open, letting listeners hear the playlists of stars including Victoria Azarenka, whose chosen tracks included Hands to Myself by US singer Selena Gomez. The Courier-Mail says Victoria Racing Club, which administers racing in the southern state, was owed AUD297,250. Race sponsors include Guvera, which had its own race called the Guvera Stakes. Other creditors include Facebook, the amount was not listed, the Australian Taxation Office, owed AUD1.1 million, and Guvera's former public relations firm Edelman, owed AUD33,950, according to The Courier-Mail. According to The Courier-Mail, one small technology business creditor was hopeful the subsidiaries' administrators, Deloitte, would succeed in reaching a resolution, although the creditor thought the cash crunch currently was a kick in the teeth. The report says Guvera's plan to pay back creditors involved raising more than AUD10 million from existing investors. One update sent earlier to associates of Guvera's fundraising partner, Amma Private Equity, said Amma had so far raised AUD1 million from "over 400 calls to the 3000 shareholders," adds The Courier-Mail. Australian-based Guvera is an online music and entertainment streaming service. INTERSTAR MILLENNIUM: Fitch Affirms 'Bsf' Rating on Cl. B Notes --------------------------------------------------------------- Fitch Ratings has downgraded five and affirmed 10 classes of notes from four transactions of the Interstar Millennium Series and Challenger Millennium Series. These transactions are backed by pools of Australian conforming residential mortgages originated through a network of mortgage originators and brokers under the Challenger Millennium Trust and Interstar Millennium Trust Securitisation programmes. A full list of rating actions can be found at the end of this commentary. KEY RATING DRIVERS The downgrades of the Class AB notes of Challenger Millennium Series 2007-2L, the class AB notes of Interstar Millennium Series 2005-2L Trust and the class A1, A2 and AB notes of Interstar Millennium Series 2006-2G Trust reflect the pro rata pay structure throughout the majority of the life of the transactions that leaves downgraded notes exposed to tail risk as the transaction gets smaller. Payment priority in these transactions reverts to sequential paydown if there are carryover charge-offs or 60+ days arrears are greater than 5% of the pool balance. Fitch makes the assumption in all structured finance ratings that no clean-up call options are exercised unless originators are obligated to do so, which is not the case in the Interstar and Challenger transactions. In recent years Challenger has chosen not to exercise clean-up call options. The 60+ days arrears for Interstar 2005-2L and Challenger 2007-2L are 4.16% and 4.36% respectively as of 31 March 2016. While the class AB notes in these two transactions are exposed to concentration risk due to the current pro-rata pay structure, there is a higher likelihood that the transactions will revert to sequential paydown with further portfolio deterioration or with continued paydown of the portfolio, which would mean that the arrears trigger would be met. The Interstar 2005-2L portfolio consists of 91.3% low-documentation mortgages and 87.0% for Challenger 2007-2L. Low-doc mortgages typically perform worse than full-documentation loans. The current pool factors for Interstar 2005-L and Challenger 2007-2L are 5.8% and 10.7% respectively. Interstar 2006-2G's portfolio is 84.5% full-documentation loans, and as a result, the credit enhancement was lower at closing compared to the Interstar 2005-2L and Challenger 2007-2L transactions. This feature, in conjunction with the credit enhancement level required before pro-rata amortization could start being lower than that for Interstar 2005-2L and Challenger 2007-2L, results in the transaction providing less credit enhancement to support the class A1 and A2 notes. The low absolute level of credit enhancement exposes the class A1 and A2 notes to some degree of concentration risk at the tail of the transaction. As of March 2016, the 60+ days arrears was 2.15%, which is well below the trigger of 5% at which the transaction would be required to revert to sequential paydown. In its analysis, Fitch modelled various default distributions and interest rate stresses, as well as prepayment speeds. In running the scenarios, for Interstar 2006-2G, Fitch observed that most scenarios passed 'AAsf'; however, the model did result in one minor (less than 2% unpaid principal) scenario failure for the class A1 and class A2 notes. Fitch determined that the small amount of discrepancy caused by the severe stress on a number of variables simultaneously is within the tolerance level of the ratings assigned. The Challenger 2007-1E, Interstar 2005-2L and Interstar 2006-2G transactions are exposed to foreign-currency risk in the event that the Libor (Challenger 2007-1E, Interstar 2005-2L and Interstar 2006-2G), Euribor (Challenger 2007-1E) or GBP Libor (Challenger 2007-1E) turn negative and the affected trust has to make additional payments to the currency swap provider in the relevant foreign currency. Excess spread is likely to be sufficient to cover any payments payable by the trust and as such this risk has not resulted in any of the negative ratings actions taken at this time. Since closing, the trusts have had a positive coupon. As of 31 March 2016, the 30+ days arrears for Challenger 2007-1E and Interstar 2006-2G were 2.69% and 3.11% respectively, above Fitch's 4Q15 Dinkum Index of 0.95%. As of 31 March 2016, 30+ day arrears levels for Challenger 2007-2L and Interstar 2005-2L were 5.26% and 5.59% respectively, below Fitch's most recent low-doc RMBS Index of 7.29%. All loans in the underlying portfolios have 100% lenders' mortgage insurance (LMI) in place, provided mainly by QBE Lenders' Mortgage Insurance Limited (Insurer Financial Strength Rating: AA-/Stable) and Genworth Financial Mortgage Insurance Pty Limited (Insurer Financial Strength Rating: A+/Stable). Losses have remained within expectations. At end-March 2016, LMI covered 99.2% of the claims submitted from the Challenger 2007-2L transaction while LMI covered between 94.9% and 97.2% of LMI claims submitted from the other three transactions. All losses that were not covered by LMI have been covered by excess spread or the residual unit holders. The affirmations of the ten RMBS classes reflect Fitch's view that available credit enhancement supports the notes' current ratings, the agency's expectations of Australia's economic conditions and that the credit quality and performance of the loans in the collateral pools have remained within the agency's expectations. Challenger Millenium Series 2007-1E does not have the same structural issue that exposes senior notes to tail risk as it pays sequentially for the life of the transaction. VARIATIONS FROM CRITERIA Fitch said, "In our analysis of foreign-currency exposure as a result of potential negative Libor, Euribor and GBP Libor, Fitch assumed the coupons due on the notes are floored at zero and that in a 'AAAsf' stress, each of these base rates go to -0.65% for five years, for 55 months at 'AAsf'and for 24 months at 'Bsf'. The foreign-currency path assumption for AUD/GBP, AUD/US$ and AUD/EUR used for the class A notes was year 1: +/-60%, year 2: +/-80%, year 3: +/-100%, year 4 and onwards: +/-120%. For the class B notes in Challenger 2007-1E, the path assumption was year 1: +/-60%, year 2: +/-60%, year 3: +/-60%, year 4 and onwards: +/-60%." The criteria variation from the "Criteria for Interest Rate Stresses in Structured Finance and Covered Bonds" arises from stressing the impact of negative interest rates on the transactions and the criteria variation from the "APAC Residential Mortgage Criteria" arises from using the foreign- currency path assumptions for payments payable by the trust in the case of negative interest rates. There is no rating impact on the transactions as a result of the criteria variations. RATING SENSITIVITIES Credit enhancement levels for the class A notes across the transactions can support many multiples of the arrears levels reported in the latest investor reports. The ratings are not expected to be affected by modest changes in performance. The class A notes of Challenger 2007-2L and Interstar 2005-2L can withstand additional foreclosure of 33.8% and 47.7% respectively at their 'AAAsf' loss severity. The class AB notes can withstand additional foreclosure of 81.8% and 79.4% respectively at the 'Asf' loss severity. The class A and AB notes of Challenger 2007- 2L and class AB notes of Interstar 2005-2L are LMI independent at their respective ratings. All other classes are LMI dependent. At the 'AAsf' loss severity, the class A notes of Interstar 2006- 2G can withstand additional foreclosure of 74.3%. The class AB notes can withstand additional foreclosure of 96.7% at 'BBBsf' loss severity. Both the class A and AB notes are LMI independent at their respective rating. The class A and AB notes of Challenger 2007-1E can withstand an additional foreclosure of 100% at their 'AAAsf' loss severity. The class A and AB notes are LMI independent. Class B notes for all transactions would be downgraded if there was a significant reduction in payment of LMI claims and an unexpected deterioration in delinquencies, defaults and losses. All class B notes are LMI dependent and there are currently no charge-offs to date. Fitch's analysis excludes credit to excess spread. DUE DILIGENCE USAGE No third party due diligence was provided or reviewed in relation to this rating action. DATA ADEQUACY Fitch conducted a file review of 10 sample loan files focusing on the underwriting procedures conducted by Challenger Mortgage Management Pty Ltd compared to its credit policy at the time of underwriting. Fitch has checked the consistency and plausibility of the information and no material discrepancies were noted that would impact Fitch's rating analysis. A comparison of the transaction's representations, warranties and enforcement mechanisms (RW&Es) to those of typical RW&Es for this asset class is available by accessing the reports and links given under Related Research below. The rating actions are as follows (note balances as end-March 2016): Interstar Millennium Series 2005-2L (Interstar 2005-2L): US$26.9 million Class A1 (ISIN US46071TAA16) affirmed at 'AAAsf'; Outlook Stable AUD53.8 million Class A2 (ISIN AU300INTC012) affirmed at 'AAAsf'; Outlook Stable AUD8.5 million Class AB (ISIN AU300INTC020) downgraded to 'Asf' from 'AA+sf'; Outlook Stable AUD4.6 million Class B (ISIN AU300INTC038) affirmed at 'Bsf'; Outlook Stable Interstar Millennium Series 2006-2G Trust (Interstar 2006-2G): US$54.3 million Class A1 (ISIN USQ49677AA73) downgraded to 'AAsf' from 'AAAsf'; Outlook Stable US$49.8 million Class A2 (ISIN USQ49677AB56) downgraded to 'AAsf' from 'AAAsf'; Outlook Stable AUD6.8 million Class AB (ISIN AU0000INBHC6) downgraded to 'BBBsf' from 'AAAsf'; Outlook Stable AUD8.0 million Class B (ISIN AU0000INBHD4) affirmed at 'Bsf'; Outlook Stable Challenger Millennium Series 2007-1E (Challenger 2007-1E) US$40.4 million Class A2a (ISIN XS0280784637) affirmed at 'AAAsf'; Outlook Stable GBP25.0 million Class A2b (ISIN XS0280786335) affirmed at 'AAAsf'; Outlook Stable EUR31.0 million Class AB (ISIN XS0280787226) affirmed at 'AAAsf'; Outlook Stable EUR32.5 million Class B (ISIN XS0280788976) affirmed at 'Bsf'; Outlook Stable Challenger Millennium Series 2007-2L (Challenger 2007-2L) AUD84.3 million Class A (ISIN AU0000CHUHA5) affirmed at 'AAAsf'; Outlook Stable AUD7.0 million Class AB (ISIN AU0000CHUHB3) downgraded to 'Asf' from 'AAAsf'; Outlook Stable AUD5.3 million Class B (ISIN AU0000CHUHC1) affirmed at 'Bsf'; Outlook Stable L & L ADAMS: First Creditors' Meeting Scheduled For Aug. 2 ---------------------------------------------------------- John Morgan & Geoff Davis of BCR Advisory were appointed as administrators of L & L Adams Contracting Pty Ltd on July 21, 2016. A first meeting of the creditors of the Company will be held at Rockhampton Leagues Club, Cambridge Street, in Rockhampton City, Queensland, on Aug. 2, 2016, at 1:15 p.m. PRODUCTION PRINTING: First Creditors' Meeting Set For Aug. 3 ------------------------------------------------------------ Mathew Gollant of Rodgers Reidy was appointed as administrator of Production Printing (Aust) Pty Ltd on July 22, 2016. A first meeting of the creditors of the Company will be held at Rodgers Reidy, Level 3, 326 William Street, in Melbourne, on Aug. 3, 2016, at 11:00 a.m. ========= C H I N A ========= CHINA OIL: S&P Revises Outlook to Positive & Affirms 'BB' CCR ------------------------------------------------------------- S&P Global Ratings said that it had revised its outlook on China Oil And Gas Group Ltd. (COGG) to positive from stable. At the same, S&P affirmed its 'BB' long-term corporate credit rating on the China-based gas distributor and S&P's 'BB' long-term issue rating on the company's senior unsecured notes. In line with the outlook revision, S&P raised its long-term Greater China regional scale rating on COGG and the notes to 'cnBBB' from 'cnBBB-'. "We revised the outlook because we expect COGG's financial strength to improve 2016 onwards," said S&P Global Ratings credit analyst Vincent Chow. This follows the Qinghai government's delayed decision to allow the company to pass through cost increases to end customers. S&P also expects the company's domestic gas distribution business to grow, the dollar margin to recover, and capital expenditure (capex) to remain stable over the next 12-18 months. S&P affirmed the ratings because it estimates that COGG's ratio of funds from operations (FFO) to debt will recover to 18%-23% over the next two years, from 13% in 2015. The company's 2015 performance was weaker than our expectation. The Qinghai government's approval to pass through costs will restore COGG's gross margin per unit of gas sold. S&P continues to expect limited EBITDA contribution and capital expenditure relating to the upstream business due to weak oil prices. S&P believes COGG remains exposed to regulatory risk for its city gas business in China due to a lack of transparency in the setting of city-gas tariffs. In addition, the execution of cost pass-through across different local governments may not be consistent. COGG's large exposure to Qinghai province (mainly the capital city Xining), a less-developed region, has amplified the volatility in its operating cash flows compared with its peers'. In 2015, 47% of COGG's gas sales volume was from this province. As a result, S&P continues to assess COGG as having higher business risk than peers with national exposure. However, given the low prices of oil and natural gas, S&P sees a risk of margin erosion due to cost pressure as less likely in the coming two years. As a result, S&P expects the company's margin to improve in 2016-2017. S&P estimates that its dollar margin will recover to Chinese renminbi (RMB) 0.4/ cubic meter (cbm) from 2016 onward, from RMB0.31/cbm in 2015, but still below RMB0.49/cbm in 2013. "In our base case, we expect COGG's gas volumes to grow 9%-10% year-on-year (YoY) in 2016-2018 through organic growth as well as the acquisition of additional concession rights," said Mr. Chow. The growth is higher than the 6% in 2015. Furthermore, S&P believes the diversification of the company's gas distribution exposure within China will reduce the volatility from Qinghai province and improve the visibility of COGG's operating cash flows, albeit gradually. "In the upstream oil and gas business, we expect COGG to remain exposed to the volatility in oil and gas prices, such as the sharp decline in oil prices since its Canadian acquisition in July 2014. We expect COGG to still be able to generate thin but positive operating cash flows from its upstream business. However, the company's strategy of managing drilling and land acquisitions within the upstream business' operating cash flows is likely to limit its growth potential for at least the next one to two years. This is because we expect oil prices to recover slowly. As a result, we have also cut our estimate of the company's total capital expenditure to around Hong Kong dollar (HK$) 800 million per year. Such factors for COGG's core city- gas business and upstream business underpin our assessment of its business risk profile as fair," S&P said. The positive outlook reflects S&P's expectation that COGG's financial strength will gradually improve due to a growing domestic gas distribution business, recovery of dollar margin from 2016, and stable capex over the next 12-18 months. S&P expects the company's FFO-to-debt ratio to improve gradually to 18%-20% over the same period. S&P could raise the rating if it sees improved visibility on COGG's ability to pass-through its costs in a timely manner, such that its FFO-to-debt ratio improves and approaches 25% on a sustainable basis. S&P may also raise the ratings if the company improves its business risk profile through further diversification into more favorable areas within China to improve the visibility of its operating cash flows. S&P could revise the outlook to stable if COGG's ratio of FFO to debt is above 15% but the improvement is slower than S&P anticipated. This may be a result of weaker-than-expected operating cash flows caused by any negative policy action or a weak economy. In addition, large acquisitions, such as additional upstream assets, may put pressure on the ratings. KU6 MEDIA: Suspending Filing of Reports with SEC ------------------------------------------------ Ku6 Media Co., Ltd., filed a Form 15 with the Securities and Exchange Commission notifying the termination of the registration of its ordinary shares under Section 12(g) of the Securities Exchange Act of 1934. As a result of the Form 15 filing, the Company is not anymore obliged to submit reports with the SEC. About Ku6 Media Ku6 Media Co., Ltd. -- http://ir.ku6.com/-- is an Internet video company in China focused on User-Generated Content. Through its premier online brand and online video Web site -- http://www.ku6.com/-- Ku6 Media provides online video uploading and sharing service, video reports, information and entertainment in China. Ku6 Media reported a net loss of $2.05 million on $10.9 million of total net revenues for the year ended Dec. 31, 2015, compared to a net loss of $10.7 million on $8.58 million of total net revenues for the year ended Dec. 31, 2014. As of Dec. 31, 2015, KU6 Media had $9.01 million in total assets, $14.49 million in total liabilities and a total shareholders' deficit of $5.48 million. PricewaterhouseCoopers Zhong Tian LLP, in Shanghai, the People's Republic of China, issued a "going concern" qualification on the consolidated financial statements for the year ended Dec. 31, 2015, citing that facts and circumstances including recurring losses, negative working capital, net cash outflows, and uncertainties associated with significant changes made, or planned to be made, in respect of the Company's business model raise substantial doubt about the Company's ability to continue as a going concern. ========= I N D I A ========= ALLIED MEDICAL: Ind-Ra Assigns 'IND BB' Long-Term Issuer Rating --------------------------------------------------------------- India Ratings and Research (Ind-Ra) has assigned Allied Medical Limited (AML) a Long-Term Issuer Rating of 'IND BB'. The Outlook is Stable. KEY RATING DRIVERS The ratings reflect AML's small scale of operations and moderate credit metrics despite volatile EBITDA margins. The company's provisional FY16 financials indicate revenue of INR303.3 million, (FY15: INR345.82 million). Its net leverage (total Ind-Ra adjusted net debt/operating EBITDAR) was 2.15x in FY16 (FY15: 2.08x), interest cover (operating EBITDA/Gross Interest Expense) was 3.13x (2.81x) and EBITDA margins were 18.30% (16.17%). The EBITDA margins fluctuated between 16.17% to 19.33 during FY14- FY16 due to the volatility in raw material prices. The ratings, however, are supported by over 30 years of operating experience of AML's promoters in the life saving equipment manufacturing business. The ratings are further supported by the company's strong relationships with customers and suppliers. The ratings factor in AML's comfortable liquidity as evident from its 89.67% average utilisation of the working capital limits during the 12 months ended June 2016. RATING SENSITIVITIES Negative: A significant decline in the revenue due to a fall in work orders, leading to weaker credit metrics, could be negative for the ratings. Positive: A significant improvement in the revenue while maintaining or improving its credit metrics from the current levels could be positive for the ratings. COMPANY PROFILE AML was incorporated in 1982, and is engaged in manufacturing and trading of life saving equipment, surgical and hospital equipment such as anaesthesia machines and anaesthesia vaporisers and other medical equipment. Its manufacturing facility is located in Gurgaon, Haryana. AML's ratings: -- Long-Term Issuer Rating: assigned 'IND BB'/Stable -- INR100 million fund-based limits: assigned 'IND BB'/Stable/'IND A4+' -- INR50 million non-fund-based limits: assigned 'IND A4+' ANIL SANTHOSH: CRISIL Assigns B+ Rating to INR10MM LT Loan ---------------------------------------------------------- CRISIL has assigned its 'CRISIL B+/Stable/CRISIL A4' ratings on the bank facilities of Anil Santhosh & Associates (ASA). Amount Facilities (INR Mln) Ratings ---------- --------- ------- Proposed Long Term Bank Loan Facility 10 CRISIL B+/Stable Bank Guarantee 10 CRISIL A4 Overdraft Facility 60 CRISIL A4 The rating reflects ASA's exposure to intense competition in civil construction industry in Kerala, modest net worth and moderately high working capital requirements. These rating weaknesses are partially offset by extensive experience of the partners in the construction industry. Outlook: Stable CRISIL believes that Anil Santhosh & Associates (ASA) will continue to benefit from its extensive experience of proprietors over the medium term. The outlook maybe revised to 'Positive' in case the firm significantly improves its scale of operations and profitability leading to better than expected cash accruals along with efficient working capital management. Conversely, the outlook maybe revised to 'Negative' in case of lower than expected cash accruals or larger than expected working capital requirements or large debt funded capex pressurizing the firm's liquidity. Established in 1995, Anil Santhosh & Associates (ASA) is a Palakkad based partnership firm involved in civil construction. The firm's partners are Mr. Anil George and Mr. Santhosh V. BOSTIN ENGINEERS: Ind-Ra Suspends 'IND D' Long-Term Issuer Rating ----------------------------------------------------------------- India Ratings and Research (Ind-Ra) has migrated Bostin Engineers Pvt. Limited's (BEPL) 'IND D' Long-Term Issuer Rating to the suspended category. The rating will now appear as 'IND D(suspended)' on the agency's website. The ratings have been migrated to the suspended category due to lack of adequate information. Ind-Ra will no longer provide ratings or analytical coverage for BEPL. The ratings will remain in the suspended category for a period of six months and be withdrawn at the end of that period. However, in the event the issuer starts furnishing information during this six-month period, the ratings could be reinstated and will be communicated through a rating action commentary. BEPL' ratings: -- Long-Term Issuer Rating: migrated to 'IND D(suspended)' from 'IND D' -- INR4.96 million Long-term loans: migrated to Long-term 'IND D(suspended)' from Long-term 'IND D' -- INR60 million fund-based working capital limits: migrated to Long-term 'IND D(suspended)' from Long-term 'IND D' -- INR89 million non-fund-based working capital credit limits: migrated to Short-term 'IND D(suspended)' from Short-term 'IND D' CASTINGS INDIA: Ind-Ra Assigns 'IND B+' Long-Term Issuer Rating --------------------------------------------------------------- India Ratings and Research (Ind-Ra) has assigned Castings India Private Limited (CIPL) a Long-Term Issuer Rating of 'IND B+'. The Outlook is Stable. A full list of rating action is at the end of this commentary. KEY RATING DRIVERS The ratings reflect CIPL's small scale of operations and weak credit metrics. According to FY16 provisional numbers, the company's revenue was INR325 million (FY15:INR321 million). Its net financial leverage (net debt/EBITDA) was 4.5x in FY16 (FY15: 4.3x), EBITDA interest coverage (EBITDA/gross interest) was 1.5x (1.1x) and operating EBITDA margin was 3.8% (FY15: 3%). The ratings also factor in CIPL's tight liquidity profile as reflected by overutilization of its working capital limit on average during the 12 months ended June 2016. The ratings, however, are supported by the founder's rich experience of more than two decades in casting iron manufacturing business. RATING SENSITIVITIES Positive: An increase in revenue and operating profit, along with an improvement in the credit metrics, could be positive for the ratings. Negative: A decline in the operating profitability, resulting in deterioration in the interest coverage, could be negative for the ratings. COMPANY PROFILE Incorporated in 1996, CIPL is a re-rolling mill. The company manufactures TMT bar and rod and construction castings such as mild steel round, tor steel, flat square, light angle and Z section at its facility (with an annual installed capacity of 14,400MT) in Gamharia, Jamshedpur. The company's registered office is in Kolkata, West Bengal. It is managed by Mr. Surendra Kumar Shroff. CIPL's Ratings -- Long-Term Issuer Rating: assigned 'IND B+'/Stable -- INR14 million Long-term loan: assigned 'IND B+'/Stable -- INR50 million fund-based working capital: assigned 'IND B+'/Stable DACSS GRANITES: CRISIL Lowers Rating on INR65MM LT Loan to 'B' -------------------------------------------------------------- CRISIL has downgraded its rating on the long-term bank facilities of Dacss Granites Private Limited (DGPL) to 'CRISIL B/Stable' from 'CRISIL B+/Stable', and reaffirmed its rating on the short- term facilities at 'CRISIL A4'. Amount Facilities (INR Mln) Ratings ---------- --------- ------- Bank Guarantee 2 CRISIL A4 (Reaffirmed) Letter of Credit 20 CRISIL A4 (Reaffirmed) Long Term Loan 65 CRISIL B/Stable (Downgraded from 'CRISIL B+/Stable') Packing Credit 190 CRISIL A4 (Reaffirmed) Proposed Long Term 63 CRISIL B/Stable (Downgraded Bank Loan Facility from 'CRISIL B+/Stable') The downgrade reflects pressure on liquidity due to low cash accrual against debt obligation in fiscal 2016, which will continue over the medium term. Large working capital requirement due to sizeable inventory led to high bank limit utilisation of over 95% in the 12 months ended March 2016. Working capital cycle will remain a key monitorable over the medium term. The ratings reflect DGPL's below-average financial risk profile because of moderate gearing and weak debt protection metrics, and small scale of, and working capital-intensive, operations. These weaknesses are partially offset by extensive experience of its promoter. Outlook: Stable CRISIL believes DGPL will benefit over the medium term from the extensive experience of its promoter in the granite industry and established track record. The outlook may be revised to 'Positive' if sustained increase in scale of operations and operating profitability leads to a better financial risk profile. The outlook may be revised to 'Negative' if deterioration in working capital cycle or decline in operating profitability further weakens financial risk profile. Set up in 2005 Mr. Darala Ashwani Kumar Reddy, DGPL processes rough granite blocks into polished granite slabs. DEE-TECH PROJECTS: Ind-Ra Suspends 'IND BB' LT Issuer Rating ------------------------------------------------------------ India Ratings and Research (Ind-Ra) has migrated Dee-Tech Projects Pvt. Ltd.'s (DTPL) 'IND BB' Long-Term Issuer Rating to the suspended category. The Outlook was Stable. The rating will now appear as 'IND BB(suspended)' on the agency's website. The ratings have been migrated to the suspended category due to lack of adequate information. Ind-Ra will no longer provide ratings or analytical coverage for DTPL. The ratings will remain in the suspended category for a period of six months and be withdrawn at the end of that period. However, in the event the issuer starts furnishing information during this six-month period, the ratings could be reinstated and will be communicated through a rating action commentary. DTPL's Ratings: -- Long-Term Issuer Rating: migrated to 'IND BB(suspended)' from 'IND BB'/ Stable -- INR220 million fund-based limits: migrated to 'IND BB(suspended)'from 'IND BB' -- INR310 million non-fund-based limits: migrated to 'IND BB(suspended)'/'IND A4+(suspended)' from 'IND BB'/ 'IND A4+' DEVDHAR RICE: Ind-Ra Suspends 'IND B-' Long-Term Issuer Rating -------------------------------------------------------------- India Ratings and Research (Ind-Ra) has migrated Devdhar Rice Mill's (DERM) 'IND B-' Long-Term Issuer Rating to the suspended category. The Outlook was Stable. The rating will now appear as 'IND B-(suspended)' on the agency's website. The ratings have been migrated to the suspended category due to lack of adequate information. Ind-Ra will no longer provide ratings or analytical coverage for DERM. The ratings will remain in the suspended category for a period of six months and be withdrawn at the end of that period. However, in the event the issuer starts furnishing information during this six-month period, the ratings could be reinstated and will be communicated through a rating action commentary. DERM's ratings: -- Long-Term Issuer Rating: migrated to 'IND B-(suspended)' from 'IND B-'/Stable -- INR87 million fund-based working capital limits: migrated to 'IND B-(suspended)' from 'IND B-' and 'IND A4(suspended)' from 'IND A4' DLECTA FOODS: CRISIL Reaffirms B+ Rating on INR147MM Term Loan -------------------------------------------------------------- CRISIL's ratings on the bank facilities of Dlecta Foods Private Limited (DFPL) continues to reflect DFPL's weak financial risk profile, marked by a small net worth and high gearing, its modest scale of operations in the intensely competitive dairy industry and susceptibility to offtake risk on its undergoing project. Amount Facilities (INR Mln) Ratings ---------- --------- ------- Cash Credit 73 CRISIL B+/Stable (Reaffirmed) Letter of Credit 5 CRISIL A4 (Reaffirmed) Proposed Long Term Bank Loan Facility 47.7 CRISIL B+/Stable (Reaffirmed) Term Loan 147 CRISIL B+/Stable (Reaffirmed) These rating weaknesses are partially offset by the company's strong business risk profile supported by its focus on niche segments, operational benefits derived from association with Schreiber Dynamix Dairies Ltd (Schreiber; rated 'CRISIL AA- /Stable/CRISIL A1+'), and its promoters' experience in the dairy industry. Outlook: Stable CRISIL believes that DFPL will continue to benefit over the medium term from its association with Schreiber and its promoters' extensive industry experience. The outlook may be revised to 'Positive' if the company's financial risk profile, especially its liquidity, improves, most likely due to equity infusion or substantial cash accruals. Conversely, the outlook may be revised to 'Negative' if DFPL's financial risk profile, especially its liquidity, deteriorates because of low accruals, lengthening of its working capital cycle, or debt-funded capex. DFPL was originally established as Devashree Foods Pvt Ltd in 2001; the name was changed in 2014. The company markets and distributes dairy products, such as butter, cheese, and milk powder. It purchases these products from Schreiber and sells them under its own brand, Delecta. DFPL has a unit for manufacturing non-dairy whipped cream and creamer cups (evaporated ultra-high temperature milk packed in polyvinyl chloride cups). EARTH STAHL: CARE Reaffirms 'D' Rating on INR19.65cr LT Loan ------------------------------------------------------------ CARE reaffirms the ratings to the bank facilities of Earth Stahl and Alloys Private Limited. Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long-term Bank Facilities 19.65 CARE D Reaffirmed Short-term Bank Facilities 0.40 CARE D Reaffirmed Rating Rationale The reaffirmation of the ratings assigned to the bank facilities of Earth Stahl and Alloys Private Limited (ESAPL) takes into consideration the on-going delay in debt servicing and classification of the company's account as Non-performing Asset. The ability of ESAPL to timely service its debt obligations with improvement in liquidity position is the key rating sensitivity. Incorporated in 2009, ESPL, promoted by Mr Ravi Laddha and Mr Rajesh Somani, is engaged in the manufacturing of cast iron lumps (using waste iron content material) which are subsequently used by the iron foundries and steel plants to manufacture ingots, pellets and billets. The company is also involved in the trading of the iron scrap. ESPL has its manufacturing units located at Simga, Chhattisgarh, having an installed capacity of 10,800 metric tonnes per annum (MTPA) as on March 31, 2015. During FY15, the total operating income of the company stood at INR32.16 crore (vis-a-vis INR30.21 crore in FY14), whereas a net loss of INR0.79 crore was incurred in the same year (vis-Ö-vis PAT of INR0.05 crore in FY14). Furthermore, during FY16 (prov.), the total operating income stood at INR11.94 crore, whereas the net loss during the same year stood at INR4.22 crore. EMSON GEARS: CRISIL Lowers Rating on INR647.1MM Loan to 'B+' ------------------------------------------------------------ CRISIL has downgraded its rating on the long-term bank facilities of Emson Gears Limited (EGL; part of the Emson group) to 'CRISIL B+/Stable' from 'CRISIL BB/Stable'. Amount Facilities (INR Mln) Ratings ---------- --------- ------- Cash Credit 240 CRISIL B+/Stable (Downgraded from 'CRISIL BB/Stable') Proposed Cash 60 CRISIL B+/Stable (Downgraded Credit Limit from 'CRISIL BB/Stable') Proposed Long Term 52.9 CRISIL B+/Stable (Downgraded Bank Loan Facility from 'CRISIL BB/Stable') Term Loan 647.1 CRISIL B+/Stable (Downgraded from 'CRISIL BB/Stable') The downgrade reflects CRISIL's belief that Emson group's liquidity will remain stretched on account of large repayment obligations of around INR171 million in fiscal 17. Large debt was contracted for the expansion of facilities in fiscal 14 and 15, however sluggish demand in the automotive sector restricted ramp up of operations, leading to moderation in profitability; and operating income to gross block ratio slipping to less than 1 time. Although, demand has improved in the first quarter of fiscal 17, mainly from the tractor industry; in anticipation of a healthy monsoon, the expected net cash accrual will be tightly matched against maturing debt obligations. Consequently, incremental working capital requirement will be debt funded and in turn will keep current ratio weak at 0.9 time. In fiscal 16, the shortfall in cash accruals against maturing debt obligations of INR274 million was primarily met by refinancing/incurring additional debt. The rating continues to reflect working capital intensive operations, stretched liquidity on account of large maturing debt, and end-user concentration leading to exposure to macro- economic factors of the industry and impact, thereof. The weaknesses are partially offset by the established position, and integrated operations supporting profitability. For arriving at the rating, CRISIL has combined the business and financial risk profiles of EGL and Osho Forge Ltd (OFL). This is because these companies, collectively referred to as the Emson group, operate in the same line of business and are under a common management. OFL manufactures gears, crown wheels, and pinions, all of which are used as raw material by EGL. CRISIL used to consolidate Osho Gears and Pinion Ltd (OGPL) also, however, the same is now merged with EGL. Outlook: Stable CRISIL believes the Emson group will continue to benefit from its established market position in the automotive components segment. The outlook may be revised to 'Positive' if significant ramp up in operations while maintaining/improving profitability leads to higher cash accruals. The outlook may be revised to 'Negative' if working capital requirement or lower-than-expected cash accruals or large debt-funded capital expenditure weaken the financial risk profile, especially liquidity. The Emson group comprises EGL and OFL. EGL was established as a partnership firm, Emson Sales, in 1981. The firm, founded by Mr Ashok Kumar Dhall and Mr Vimal Dhall, manufactures gears and was reconstituted as a limited company in 1981. In 1993, the group established OFL to implement vertical integration into the forgings segment. In the same year, another facility to manufacture gears and pinions was set up under OGPL, the same is now merged with EGL. G. T. HOMES: CRISIL Reaffirms B+ Rating on INR230MM Term Loan ------------------------------------------------------------- CRISIL's rating on the long-term bank facility of G. T. Homes (GTH) continues to reflect GTH's susceptibility to project implementation and demand risks and to cyclicality in the real estate industry in India. These rating weaknesses are partially offset by the extensive experience of the firm's partners in the real estate industry and the funding support that it receives from them. Amount Facilities (INR Mln) Ratings ---------- --------- ------- Term Loan 230 CRISIL B+/Stable (Reaffirmed) Outlook: Stable CRISIL believes that GTH will continue to benefit over the medium term from its partners' extensive industry experience and the funding support that it receives from them. The outlook may be revised to 'Positive' if the firm completes its projects on time, and achieves significant customer bookings, resulting in improvement in its liquidity. Conversely, the outlook may be revised to 'Negative' in case of pressure on GTH's liquidity, most likely on account of a time or cost overrun in its projects or lower-than-expected advances from customers, resulting in low cash inflows, or if the firm undertakes large debt-funded projects. GTH, established in 2003 as a partnership firm, executes real estate projects; it is owned and managed by Mr. Gajendra Singh Rajpal and his nephew, Mr. Gurjeet Singh Rajpal. The firm is currently executing two residential real estate projects in Raipur and Naya Raipur (both in Chhattisgarh). GAJRAJ HOTELS: CARE Ups Rating on INR18.03cr LT Loan to 'C' ----------------------------------------------------------- CARE revises the rating assigned to the bank facilities of Gajraj Hotels Private Limited. Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long-term Bank Facilities 18.03 CARE C Revised from CARE D Rating Rationale The revision in the rating of Gajraj Hotels Private Limited (GHPL) factors in the improvement in debt servicing track record. The rating also continues to draw comfort from experience of the promoters and favourable location of the hotel property. The rating, however, continues to remain constrained on account of small scale of operations, weak financial risk profile characterized by cash losses, leveraged capital structure, stressed debt coverage indicators and liquidity position. The rating also factors in cyclical nature of the hotel industry coupled with high competition and subdued industry outlook. Going forward, GHPL's ability to improve the overall financial profile shall be the key rating sensitivity. GHPL was incorporated on November 6, 1992, by Mr Chand Ram, his wife Ms Krishna Devi and his son, Mr Gajraj Singh. The company commenced operations with its first hotel named 'Hotel Gajraj' (HG) established in the year 1992. GHPL has set up another hotel by the name of 'Motel Gajraj Continental' (GC) in Bahadurgarh, Haryana, which commenced its fullfledged operations from April 2013. From April 2016 onwards, the company has discontinued the operations of 'Hotel Gajraj'. In FY15 (refers to the period April 1 to March 31), GHPL achieved a total operating income (TOI) of INR6 crore with PBILDT of INR1.85 crore as against TOI of INR6.65 crore with PBILDT of INR2.81 crore in FY14. Furthermore, during FY16 (as per the provisional results), the company has achieved total operating income of INR4.47 crore with PBILDT of INR0.82 crore. GINGER INFRASTRUCTURE: CARE Assigns B+ Rating to INR15cr LT Loan ---------------------------------------------------------------- CARE assigns 'CARE B+' rating to the bank facilities of Ginger Infrastructure Private Limited. Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long term Bank Facilities 15 CARE B+ Assigned Rating Rationale The rating assigned to the bank facilities of Ginger Infrastructure Private Limited (GIPL) are constrained by the risk emanating from execution of the project underway and risk related to timely commencement and stabilization of operations. The rating further takes into consideration the low booking status as on May 31, 2016 (refers to the period April 1 to March 31) and presence in a competitive environment. The above constraints outweigh the comfort derived from the experience of the promoters and strategic location of the project. The ability of the company to successfully complete the project in a timely manner without any cost overrun and deriving benefit as envisaged are the key rating sensitivities. Incorporated in Dec. 19, 2012, GIPL is a Nagpur based special purpose vehicle (SPV) formed by Diamant Infrastructure Limited (DIL) for construction and development of commercial complex at Jaripatka (Nagpur) under the name of "Ginger Square" to be operated on a built-operate-transfer (BOT) basis for a concession period of 30 years commencing from August 2016 and ending in August 2046, with renewal of lease further for a period of 30 years. The project was awarded by Nagpur Municipal Corporation (NMC) for construction and development of the commercial complex. The proposed complex would consist of shops, restaurants, hotels, shopping mall, banquet halls, car parking, etc, distributed on different floors over total area of 3.16 lakh square feet (lsf). GIPL will sublease the shops, for this purpose NMC, along with GIPL and each sub lessee shall enter into a tripartite agreement and the hotels and banquet halls shall be operated by GIPL. An agreement has been signed between GIPL and NMC on May 08, 2014, for construction and development on BOT with a construction period of 2.5 years which is expected to get completed by December 2016 and the concession period of 30 years commencing from August 2016 and ending in August 2046 with 1 Complete definition of the ratings assigned are available at renewal of lease for further period of 30 years. Thereafter, the facility at the site would stand transferred to NMC. The total cost of the project is estimated at INR59.80 crore which will be funded by the promoter's contribution of INR15.00 crore, advance against sale of shops of INR14.80 crore and bank term loan of INR30.00 crore. The financial closure for the said debt funding has been achieved and the construction of the proposed project is expected to be completed by the end of December 2016. DIL is the main promoter of GIPL holding a major share of 51% till FY16 (refers to the period April 1 to March 31). However, in FY17, the stake of DIL in GIPL is reduced to 33%. DIL was incorporated in 1980 and is engaged in the execution of civil construction (mainly into road construction) and real estate projects. GODAWARI POWER: CARE Lowers Rating on INR1,110.21cr Loan to 'D' --------------------------------------------------------------- CARE revises the ratings on the bank facilities/instrument of Godawari Power and Ispat Limited. Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long term Bank Facilities 1110.21 CARE D Revised from CARE BBB+ Short term Bank Facilities 300.00 CARE D Revised from CARE A3+ NCD 76.67 CARE D Revised from CARE BBB+ Rating Rationale The revision in the ratings takes into account the ongoing delays in debt servicing by the company. Incorporated on September 21, 1999, GPIL is promoted by the Hira group. GPIL is engaged in manufacturing and selling of iron ore pellets, sponge iron, steel billets, ferro alloys, and various long steel products like MS round in coil (wire rods) and Hard Black (HB) wires, from its plant located at Raipur, Chhattisgarh. GPIL has operational captive iron ore mines at Ari Dongri, Chhattisgarh with a capacity of 14,00,000 tpa and at Boria Tibu, Chhattisgarh with a capacity of 7,00,000 tpa. As on March 31, 2016, GPIL had capacities for manufacturing 18,00,000 tonnes per annum (tpa) of pellets, 4,95,000 tpa of sponge iron, 4,00,000 tpa of steel billets, 1,00,000 tpa of MS Round Coil and 150,000 tpa of HB wire. The company's performance was affected due to prevailing adverse market conditions in the iron and steel industry and consequent reduction in operating margins leading to stress on cash flows. GPIL registered a net loss of INR 63.39 crore on total operating income of INR 1538.07 crore in FY16 (refers to the period April 1 to March 31) as against PAT of INR 62.11 crore on a total income of INR 1924.25 crore in FY15. HARITHA BIO: Ind-Ra Suspends 'IND D' Long-Term Issuer Rating ------------------------------------------------------------ India Ratings and Research (Ind-Ra) has migrated Haritha Bio Products India Private Limited (HBPIPL) 'IND D' Long-Term Issuer Rating to the suspended category. The rating will now appear as 'IND D(suspended)' on the agency's website. The ratings have been migrated to the suspended category due to lack of adequate information. Ind-Ra will no longer provide ratings or analytical coverage for HBPIPL. The ratings will remain in the suspended category for a period of six months and be withdrawn at the end of that period. However, in the event the issuer starts furnishing information during the six-month period, the ratings could be reinstated and will be communicated through a rating action commentary HBPIPL's ratings: -- Long-Term Issuer Rating: migrated to 'IND D(suspended)' from 'IND D' -- INR326 million Long-term loan: migrated to 'IND D(suspended)' from 'IND D' -- INR130 million fund-based limits: migrated to 'IND C (suspended)' from 'IND C' and 'IND A4(suspended)' from 'IND A4' HYDRAULIC ENGINEERS: Ind-Ra Cuts LT Issuer Rating to 'IND B+' ------------------------------------------------------------- India Ratings and Research (Ind-Ra) has downgraded Hi-Tech Hydraulic Engineers' (Hi-Tech) Long-Term Issuer Rating to 'IND B+' from 'IND BB-'. The Outlook is Stable. A full list of rating actions is at the end of the commentary. KEY RATING DRIVERS The downgrade reflects Hi-Tech's tight liquidity as evident from instances of over utilisation of the working capital limits for the six months ended June 2015, which were regularised within 11 days. According to the unaudited provisional financial statements for FY16, the net working capital cycle lengthened to 217 days (FY15: 95 days; FY14: 102 days) on the back of a high receivable period of 221 days (62 days; 116 days). The ratings continue to reflect Hi-tech's small scale of operations and moderate credit metrics with a revenue of INR283.2m in FY16 (FY15: INR244.3 million; FY14: INR205.5 million), net leverage (total adjusted net debt/operating EBITDA) of 3.15x (5.3x; 2.5x) and interest coverage (operating EBITDA/gross interest expenses) of 2.0x (2.1x; 3.2x). EBITDA margins improved to 13.7% in FY16 from 8.1% in FY15. The management attributes the improvement to the inclusion of high margin machinery components in its product portfolio. Hi-tech incurred capex of INR95 million in FY15 and FY16 to double its capacity to 3,600TPA from 1,800TPA at its manufacturing unit. The additional capacity has been operational since end-June 2015. The ratings also factor in the partnership structure of the organisation. The ratings, however, continue to be supported by the firm's established operational track record and the founder's operating experience of over a decade in manufacturing hydraulic machinery components. RATING SENSITIVITIES Positive: A sustained improvement in the liquidity position will be positive for the ratings. Negative: Further stress on the liquidity on a margin contraction or further deterioration in the cash conversion cycle will be negative for the ratings. COMPANY PROFILE Incorporated in 2002, Hi-Tech is a Hyderabad-based partnership firm, involved in the manufacture of hydraulic machinery components and heavy structural fabrication work. Hi-Tech's ratings: -- Long-Term Issuer Rating: downgraded to 'IND B+'/Stable from 'IND BB-'/Stable -- INR45.7 million long-term loan (decreased from INR50.0 million): downgraded to 'IND B+'/Stable from 'IND BB-'/Stable -- INR60 million fund-based limits (increased from INR50 million): downgraded to 'IND B+'/Stable from 'IND BB-'/Stable -- INR30 million non-fund-based limits (decreased from INR40 million): downgraded to 'IND A4' from 'IND A4+' INDICON CONSTRUCTION: CRISIL Reaffirms B Rating on INR39MM Loan --------------------------------------------------------------- CRISIL's ratings on the bank facilities of Indicon Construction Private Limited (ICPL) continue to reflect its modest scale of operations, large working capital requirement, and exposure to risks related to intense competition and tender-driven nature of business in the civil construction industry. These rating weaknesses are partially offset by the extensive industry experience of its promoters and a moderate capital structure. Amount Facilities (INR Mln) Ratings ---------- --------- ------- Bank Guarantee 10.8 CRISIL A4 (Reaffirmed) Cash Credit 39.0 CRISIL B/Stable (Reaffirmed) Proposed Long Term Bank Loan Facility 10.2 CRISIL B/Stable (Reaffirmed) Outlook: Stable CRISIL believes ICPL 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 significant and sustained growth in revenue and cash accrual, while the capital structure is maintained. The outlook may be revised to 'Negative' if the company's financial risk profile, particularly liquidity, deteriorates on account of low cash accrual, a stretched working capital cycle, or large capital expenditure. ICPL was set up in 2003 by Mr. Pradeep Kadam and Mr. Ashok Dhamdhere in Pune. It undertakes construction activity within Maharashtra for the Public Works Department and Pradhan Mantri Gram Gadak Yojana. The company is registered as a Class 1-A contractor with the Government of Maharashtra and constructs roads mainly in Pune district. JAYARAJ INTERNATIONAL: CRISIL Reaffirms B+ Rating on INR50MM Loan ----------------------------------------------------------------- CRISIL's ratings on the bank facilities of Jayaraj International Private Limited (JIPL) continue to reflect the company's modest scale of operations in the intensely competitive timber trading industry and below-average financial risk profile because of small networth, high total outside liabilities to tangible networth (TOLTNW) ratio, and weak debt protection metrics. These weaknesses are partially offset by the extensive experience of its promoters. Amount Facilities (INR Mln) Ratings ---------- --------- ------- Cash Credit/ Overdraft facility 50 CRISIL B+/Stable (Reaffirmed) Letter of Credit 250 CRISIL A4 (Reaffirmed) Outlook: Stable CRISIL believes JIPL will continue to benefit over the medium term from the extensive experience of its promoters. The outlook may be revised to 'Positive' if significant increase in scale of operations and profitability margins results in better debt protection metrics and capital structure. The outlook may be revised to 'Negative' if lower-than-expected cash accrual or sizeable debt further weakens financial risk profile. Update Revenue increased 7% year-on-year to INR375 million in fiscal 2016, as expected. This was mainly due to addition of clients with geographical expansion. Operating margin remained moderate at 8% despite exposure to fluctuation in foreign exchange rates. Operations are expected to remain working capital-intensive over the medium term because of sizeable inventory (90-120 days) of a wide variety of timber, and stretched receivables following high credit to customers. However, large working capital requirement is supported by stretched payables. Financial risk profile remains weak because of modest networth of INR72 million and high TOLTNW ratio of 3.8 times as on March 31, 2016. Furthermore, debt protection metrics are likely to remain weak, with low interest coverage ratio, in 2015-16. However, cash accrual will be sufficient to meet debt obligation over the medium term, while funding from promoters will further support liquidity. Set up in 2001 in Chennai by Mr. Raja Sekhar and his wife, Ms. T Jayasri, JIPL imports and trades in timber. For fiscal 2015, profit after tax (PAT) was INR5.2 million on revenue of INR347 million, against a PAT of INR3.9 million on revenue of INR371.3 million for fiscal 2014. For fiscal 2016, revenue is expected at about INR375 million. JUGAL KISHORE: CARE Reaffirms B+ Rating on INR9cr LT Loan --------------------------------------------------------- CARE reaffirms rating to the bank facilities of Jugal Kishore Vanaspati Products Private Limited. Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long-term Bank facilities 9 CARE B+ Suspension Revoked and reaffirmed Rating Rationale The rating of Jugal Kishore Vanaspati Products Private Limited (JKVL) continues to remain constrained on account of its relatively small scale of operations in the highly fragmented and competitive edible oil industry and its financial risk profile marked by thin and stagnant profitability margin, moderately leveraged capital structure and working capital intensive nature of operations. The rating, further, continues to remain constrained on account of project implementation risk associated with it and vulnerability of margins due to volatility in groundnut prices. The rating, however, continues to derive strength from the experienced management, strategic location of its plant and stable demand for edible oil in India. JKVL's ability to improve its scale of operations and profitability along with efficient management of working capital and timely completion of project are the key rating sensitivities. Bikaner (Rajasthan) based JKVL was incorporated as a private limited company in July 1987. JKVL is promoted by Mr. Shreeram Agarwal, Mr. Satish Agarwal and Mr. Dinesh Agarwal. The company is mainly engaged in the business of manufacturing and supplying refined groundnut oil and oil cakes. JKVL is also an ISO- 9001- 2008 certified company and has an installed capacity of 2400 Metric Tonnes Per Annum (MTPA) for crushing of groundnut seeds and 3000 MTPA for refining groundnut oil as on March 31, 2016 with manufacturing facility located at Bikaner. The company sells its product under its registered brand name of "Chandi Sikka". The company's key raw material viz. groundnut seeds are sourced from local market of Bikaner. The promoters of the company have promoted other group concern i.e. J.K. Ceramics Private Limited (JKCPL; rated CARE B+) engaged in the manufacturing of industrial guar gum powder and processing of guar refined dall, churi korma, edible oil and oil cake of mustard and groundnut. As per provisional results of FY16, JKVL has reported a total operating income of INR35.98 crore (FY15: INR39.68 crore) with a net profit of INR 0.26 crore (FY15: INR0.27 crore). KALPATARU COLD: Ind-Ra Suspends IND D' Long-Term Issuer Rating -------------------------------------------------------------- India Ratings and Research (Ind-Ra) has migrated Kalpataru Cold Storage Private Limited's (Kalpataru) 'IND D' Long-Term Issuer Rating to the suspended category. The rating will now appear as 'IND D(suspended)' on the agency's website. The ratings have been migrated to the suspended category due to lack of adequate information. Ind-Ra will no longer provide ratings or analytical coverage for Kalpataru. The ratings will remain in the suspended category for a period of six months and be withdrawn at the end of that period. However, in the event the issuer starts furnishing information during this six-month period, the ratings could be reinstated and will be communicated through a rating action commentary. Kalpataru's ratings: -- Long-Term Issuer Rating: migrated to 'IND D(suspended)' from 'IND D' -- INR41.8 million Long-term loans: migrated to Long-term 'IND D(suspended)' from Long-term 'IND D' -- INR78.8 million fund-based working capital limits: migrated to Long-term/Short-term 'IND D(suspended)' from Long- term/Short-term 'IND D' -- INR2 million non-fund-based working capital credit limits: migrated to Short-term 'IND D(suspended)' from Short-term 'IND D' KAVYA COLD: CARE Assigns B+ Rating to INR5.28cr LT Bank Loan ------------------------------------------------------------ CARE assigns 'CARE B+' rating to the bank facilities of Kavya Cold Storage. Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long-term Bank Facilities 5.28 CARE B+ Assigned Rating Rationale The rating assigned to the bank facilities of Kavya Cold Storage (KCS) is primarily constrained on account of the project stabilization risk associated to its recently completed debt- funded project for establishing cold storage facility. The rating is further constrained due to its constitution being a partnership firm; competition faced from the local players and business prospects depending on vagaries of nature and seasonality associated with it. The above constraints far outweigh the benefits derived from the partners' experience and strategic location of the firm within the potato-growing region of Gujarat. The ability of KCS to achieve the envisaged revenue and profitability margins along with better working capital management are the key rating sensitivities. Established in the year 2015, KCS had recently completed a green field project for providing cold storage facility for storing potatoes on a rental basis and started the commercial production from March, 2016. KCS was established by ten partners led by Mr Ajitkumar Patel and Mr Narendrakumar Patel. KCS had undertaken project for providing cold storage facility with an annual proposed installed capacity of 6,500 metric ton at its facilities located at Sabarkantha-Gujarat. The total cost incurred for the project was INR7.59 crore which was funded through term loan of INR4.98 crore, partner's capital of INR1.95 crore and balance of INR0.66 crore by way of unsecured loans. KAY EM COPPER: Ind-Ra Suspends 'IND BB-' Long-Term Issuer Rating ---------------------------------------------------------------- India Ratings and Research (Ind-Ra) has migrated Kay Em Copper Private Limited's 'IND BB-' Long-Term Issuer Rating to the suspended category. The Outlook was Stable. This rating will now appear as 'IND BB-(suspended)' on the agency's website. The ratings have been migrated to the suspended category due to lack of adequate information. Ind-Ra will no longer provide ratings or analytical coverage of KECPL. The ratings will remain in the suspended category for a period of six months and be withdrawn at the end of that period. However, in the event the issuer starts furnishing information during this six-month period, the ratings could be reinstated and will be communicated through a rating action commentary. KECPL's ratings: -- Long-Term Issuer Rating: migrated to 'IND BB-(suspended)' from 'IND BB-'/Stable -- INR40 million fund-based cash credit facility: migrated to 'IND BB-(suspended)' from 'IND BB-' and 'IND A4+(suspended)' from 'IND A4+' -- INR10 million non-fund based bank guarantee: migrated to 'IND A4+(suspended) from 'IND A4+' -- INR90 million non-fund-based letter of credit: migrated to 'IND A4+(suspended) from 'IND A4+' -- INR2 million FC/CEL: migrated to 'IND A4+(suspended) from 'IND A4+' KIZHAKKEBHAGATHU RICE: CRISIL Cuts Rating on INR60MM Loan to C -------------------------------------------------------------- CRISIL has downgraded its rating on the bank facility of Kizhakkebhagathu Rice Mills (KRM) to 'CRISIL C' from 'CRISIL B/Stable'. Amount Facilities (INR Mln) Ratings ---------- --------- ------- Open Cash Credit 60 CRISIL C (Downgraded from 'CRISIL B/Stable') The rating downgrade reflects instances of delays in repayments of term loans which are not rated by CRISIL. The delays have been caused on account of stretch in liquidity as seen by stretch in working capital cycle leading to fully utilized bank limits. The rating reflects KRM's modest scale of operations in the intensely competitive rice milling industry, and the susceptibility of the firm's operating profitability to changes in government regulations and to volatility in raw material prices. The rating also factors in the firm's weak financial risk profile marked by low networth, high gearing and below-average debt protection metrics. These rating weaknesses are partially offset by the extensive experience of KRM's promoters in the rice industry, and the firm's established relationships with customers and suppliers. Set up in 1997, KRM mills and processes paddy into rice, rice bran, broken rice and husk. It has an installed paddy milling capacity of 5 tonnes per hour (tph). Its rice mill is located at Muvattupuzha, Kerala. Its operations are managed by Mr. Dinu Kurien. KPM PROCESSING: Ind-Ra Upgrades LT Issuer Rating to 'IND BB' ------------------------------------------------------------ India Ratings and Research (Ind-Ra) has upgraded KPM Processing Mill Private Limited's (KPM) Long-Term Issuer Rating to 'IND BB' from 'IND BB-'. The Outlook is Stable. KEY RATING DRIVERS The upgrade reflects an improvement in KPM's scale of operations and credit metrics due to increased work orders. The company's provisional FY16 financials (year end March) indicate net revenue of INR443m (FY15: INR340m) with net financial leverage (total Ind-Ra adjusted net debt/ operating EBITDAR) of 2.5x (3.8x) and EBITDA interest cover (operating EBITDA/gross interest expenses) of 3.4x (3.6x). The operating margins remained strong at 22.5% in FY16 (FY15: 22.8%). The ratings are supported by over two decades of experience of KPM's promoters in fabric dyeing. The ratings, however, are constrained by KPM's tight liquidity position as indicated by around 100% utilisation of its working capital borrowings during the six months ended June 2016. RATING SENSITIVITIES Positive: An improvement in the scale of operations leading to improvement in the credit metrics could lead to a positive rating action. Negative: Any deterioration in the overall credit metrics could lead to a negative rating action. KPM was registered on 19 November 2010 under the Companies Act, 1956. The company has set up a 12,000kg/day fabric dyeing unit at Tirupur in Tamil Nadu. The company is promoted by P. Sekaran, N. Chandra Sekaran and Thamilselvi. KPM's ratings: -- Long-Term Issuer Rating: upgraded to 'IND BB'/Stable from 'IND BB-'/Stable -- INR90 fund-based working capital limits (increased from INR70 million): upgraded to 'IND BB'/Stable from 'IND BB-'/Stable -- INR153.16 million Long-term loans (decreased from INR199 million): upgraded to 'IND BB'/Stable from 'IND BB-'/Stable -- INR22.5 million non-fund-based working capital limit: affirmed at 'IND A4+' KRISHNA GRUH: CRISIL Suspends 'B' Rating on INR30MM Term Loan ------------------------------------------------------------- CRISIL has suspended its rating on the bank facilities of Krishna Gruh Udhyog (KGU). Amount Facilities (INR Mln) Ratings ---------- --------- ------- Cash Credit 30 CRISIL B/Stable Term Loan 30 CRISIL B/Stable The suspension of rating is on account of non-cooperation by KGU with CRISIL's efforts to undertake a review of the ratings outstanding. Despite repeated requests by CRISIL, KGU is yet to provide adequate information to enable CRISIL to assess KGU'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' KGU, a Kutch (Gujarat)-based proprietorship firm, was established in 2013. It manufactures ready-to-eat snacks such as namkeens, potato chips, and fryums. Its day-to-day operations are managed by its proprietor, Mr. Ramesh Mavji Kara. KYS MANUFACTURERS: CARE Assigns B+ Rating to INR13.13cr LT Loan --------------------------------------------------------------- CARE assigns 'CARE B+' rating to the bank facilities of Kys Manufacturers And Exporters Pvt. Limited. Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long-term Bank Facilities 13.13 CARE B+ Assigned Rating Rationale The rating assigned to the bank facilities of KYS Manufacturers and Exporters Pvt. Limited (KMPL) is constrained by its relatively small scale of operations, lack of backward integration vis-Ö-vis volatility in the raw material prices, stiff competition due to fragmented nature of the industry with presence of many unorganized players, working capital intensive nature of operations and leveraged capital structure. The aforesaid constraints are partially offset by experienced promoters with long track record of operations, and strategic location of the plant. The ability to increase its scale of operations with improvement in profit margins and ability to manage working capital effectively are the key rating sensitivities. KMPL incorporated in the year March 1997, was promoted by Mr Sandeep Malhotra and Mr Mahesh Kumar Sharma, Jamshedpur, with Mr Sandeep Malhotra being the main promoter. KMPL is engaged in the manufacturing of TMT bars and sectional products like angles, rounds, channels, etc, at its facility in Jamshedpur (Jharkhand) and is currently running with an installed capacity of 24,400 MTPA. KMPL sells its production in Jharkhand, Bihar, Uttar Pradesh, West Bengal, etc. KMPL is also engaged in trading of iron and steel related products and the same accounted for around 53% of total operating income in FY15 (refers to the period April 1 to March 31), albeit manufacturing activity being the primarily activity of KMPL. As per the audited results of FY15, KMPL reported a PAT of INR0.10 crore (PAT of INR0.04 crore in FY14), on a total operating income of INR33.70 crore (total operating income of INR23.89 crore in FY14). Furthermore, during FY16, KMPL is stated to have achieved a total operating income of INR40.00 crore. LAGU BANDHU: Ind-Ra Assigns 'IND BB' Long-Term Issuer Rating ------------------------------------------------------------ India Ratings and Research (Ind-Ra) has assigned Lagu Bandhu Motiwale Private Limited (LBMPL) a Long-Term Issuer Rating of 'IND BB'. The Outlook is Stable. The agency has also assigned LBMPL's INR200 million fund-based facilities 'IND BB' with a Stable Outlook, and 'IND A4+' ratings. KEY RATING DRIVERS The ratings reflect LBMPL's volatile revenue and declining operating profit margins during FY12-FY16, due to the retail nature of the business and its presence in a highly fragmented and competitive industry. Despite the volatility, revenue grew at a CAGR of 7% to INR1,391 million according to provisional financials for FY16 from INR1,060 million in FY12. EBITDAR margins declined to 8.0% from 20.6% during the same period. The ratings factor in the company's moderate credit metrics with net financial leverage of (adjusted net debt/EBITDAR) of 5.6x in FY16 (FY15: 6.1x), and interest cover (EBITDAR/interest+rent) of 1.4x (1.4x). In line with Ind-Ra's methodology, 'Operating Leases: Implications for Lessees' Credit', LBMPL's showroom rentals have been adjusted to arrive at the leverage ratios. The ratings also take in to account LBMPL's high working capital cycle as indicated by net cash conversion days of 382 days (FY15: 391 days) due to its high inventory holding requirements. The ratings, however, derive strength from the company's track record of operations and comfortable liquidity as indicated by its average maximum utilisation of 70.08% for the 12 months ended May 2016. RATING SENSITIVITIES Positive: Sustainable improvement in the revenue and profitability leading to an improvement in the credit metrics will be positive for the ratings. Negative: A decline in the profitability resulting in pressure on credit metrics will be negative for the ratings. COMPANY PROFILE In 1989 LBMPL was converted to a private limited entity from a partnership firm. It is engaged in the retailing of gold and diamond jewellery. The company has nine exclusive showrooms situated in Mumbai (Dadar and Borivali), Thane, Dombivali, Pune (Karve Road and Aundh), Goa, and Oklahoma, USA. LAKSHMI TRADERS: CRISIL Suspends B Rating on INR50MM Cash Loan -------------------------------------------------------------- CRISIL has suspended its ratings on the bank facilities of Lakshmi Traders (LT). Amount Facilities (INR Mln) Ratings ---------- --------- ------- Cash Credit 50 CRISIL B/Stable Letter of Credit 45 CRISIL A4 The suspension of ratings is on account of non-cooperation by Code with CRISIL's efforts to undertake a review of the ratings outstanding. Despite repeated requests by CRISIL, Code is yet to provide adequate information to enable CRISIL to assess Code'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' LT was established as a proprietorship concern by Mr. Sankarlingam, a Chennai-based entrepreneur, in 1977. The firm trades in steel scrap and steel long products such as bars, channels, and angles. It sells the steel scrap to thermo- mechanically treated (TMT) bar manufacturers, casting units, and foundries. LT has its administrative office in Chennai. LINUS PROCESSORS: Ind-Ra Suspends 'IND BB-' LT Issuer Rating ------------------------------------------------------------ India Ratings and Research (Ind-Ra) has migrated Linus Processors Private Limited's (LPPL) 'IND BB-' Long-Term Issuer Rating to the suspended category. The rating will now appear as 'IND BB- (suspended)' on the agency's website. The Outlook was Stable. The ratings have been migrated to the suspended category due to lack of adequate information. Ind-Ra will no longer provide ratings or analytical coverage for LPPL. The ratings will remain in the suspended category for a period of six months and be withdrawn at the end of that period. However, in the event the issuer starts furnishing information during the six-month period, the ratings could be reinstated and will be communicated through a rating action commentary. LPPL's ratings: -- Long-Term Issuer Rating: migrated to 'IND BB-(suspended)' from 'IND BB-'/Stable -- INR88 million fund-based limits: migrated to 'IND BB- (suspended)' from 'IND BB-' -- INR60 million non-fund-based limits: migrated to 'IND A4+(suspended)' from 'IND A4+' M C SPINNERS: Ind-Ra Suspends 'IND D' Long-Term Issuer Rating ------------------------------------------------------------- India Ratings and Research (Ind-Ra) has migrated M C Spinners Private Limited's (MCS) 'IND D' Long-Term Issuer Rating to the suspended category. The rating will now appear as 'IND D(suspended)' on the agency's website. The ratings have been migrated to the suspended category due to lack of adequate information. Ind-Ra will no longer provide ratings or analytical coverage for MCS. The ratings will remain in the suspended category for a period of six months and be withdrawn at the end of that period. However, in the event the issuer starts furnishing information during the six-month period, the ratings could be reinstated and will be communicated through a rating action commentary MCS's ratings: -- Long-Term Issuer Rating: migrated to 'IND D(suspended)' from 'IND D' -- INR150 million fund-based working capital limits: migrated to Long-term 'IND D(suspended)' from 'IND D' -- INR22 million non-fund-based working capital limits: migrated to Short-term 'IND D(suspended)' from 'IND D' -- INR256.5 million long-term loans: migrated to Long-term 'IND D(suspended)' from 'IND D' M.S. COLD: Ind-Ra Suspends IND BB-' Long-Term Issuer Rating ----------------------------------------------------------- India Ratings and Research (Ind-Ra) has migrated M.S. Cold Storage 's (MSCS) 'IND BB-' Long-Term Issuer Rating to the suspended category. The Outlook was Stable. The rating will now appear as 'IND BB-(suspended)' on the agency's website. The agency has also migrated MSCS' INR90.1 million term loan to 'IND BB-(suspended)' from 'IND BB-'. The ratings have been migrated to the suspended category due to lack of adequate information. Ind-Ra will no longer provide ratings or analytical coverage for MSCS. The ratings will remain in the suspended category for a period of six months and be withdrawn at the end of that period. However, in the event the issuer starts furnishing information during the six-month period, the ratings could be reinstated and will be communicated through a rating action commentary. MANNA RICE: CRISIL Assigns 'B' Rating to INR57.5MM LT Loan ---------------------------------------------------------- CRISIL has assigned its 'CRISIL B/Stable' rating to the long-term bank facilities of Manna Rice Industries Private Limited (MRIPL). Amount Facilities (INR Mln) Ratings ---------- --------- ------- Proposed Long Term Bank Loan Facility 22.5 CRISIL B/Stable Cash Credit 10.0 CRISIL B/Stable Long Term Loan 57.5 CRISIL B/Stable The rating reflects the company's exposure to risks related to implementation, stabilisation related risk of its rice mill project. These weakness are partially offset by the extensive experience of its promoters in the rice industry. Outlook: Stable CRISIL believes MRIPL will implement its rice mill without any significant time or cost overrun. The ratings may be revised to 'Positive' if the company generates higher than expected cash accruals, backed by timely stabilisation of operations post capex, resulting in improvement in financial risk profile. Conversely, the outlook may be revised to 'Negative' if lower- than-expected revenue or profitability or deterioration in working capital management or any significant unexpected debt- funded capital expenditure negatively impacts financial risk profile and liquidity. MRIPL, incorporated in 2010, is setting up a rice mill at Kuttannad in Kerala. The company is promoted by Mr James K C, Mr Mathew Varghese Chirayathu, and Mr Rofin M, and its operations are managed by Mr. Vijayan Nampoothiry N. MATRIX ROLLER: Ind-Ra Suspends 'IND B' Long-Term Issuer Rating -------------------------------------------------------------- India Ratings and Research (Ind-Ra) has migrated Matrix Roller Mill Private Limited's (MARF) 'IND B' Long-Term Issuer Rating to the suspended category. The Outlook was Stable. This rating will now appear as 'IND B(suspended)' on the agency's website. The ratings have been migrated to the suspended category due to lack of adequate information. Ind-Ra will no longer provide ratings or analytical coverage for MARF. The ratings will remain in the suspended category for a period of six months and be withdrawn at the end of that period. However, in the event the issuer starts furnishing information during the six-month period, the ratings could be reinstated and will be communicated through a rating action commentary. MARF's are as follows: -- Long-Term Issuer Rating: migrated to 'IND B(suspended)' from 'IND B'/Stable -- INR71 million fund-based working capital limits: migrated to 'IND B(suspended)' from 'IND B' and 'IND A4(suspended) from 'IND A4' -- Proposed INR29 million fund-based limits: migrated to 'Provisional IND B(suspended)' from 'Provisional IND B' and 'Provisional IND A4(suspended)' from 'Provisional IND A4' -- INR60 million term loans: migrated to 'IND B(suspended)' from 'IND B' -- Proposed INR16 million term loans: migrated to 'Provisional IND B(suspended)' from 'Provisional IND B' MINAKSHI COTEX: CRISIL Reaffirms B+ Rating on INR100MM Cash Loan ---------------------------------------------------------------- CRISIL's rating on the bank facility of Minakshi Cotex (Minakshi) continues to reflect the firm's weak financial risk profile, marked by weak debt protection metrics and moderate gearing, its working capital intensive nature of operations, and susceptibility to volatility in raw material prices and to adverse regulatory changes. Amount Facilities (INR Mln) Ratings ---------- --------- ------- Cash Credit 100 CRISIL B+/Stable (Reaffirmed) These rating weaknesses are partially offset by the extensive experience of Minakshi's partners in the cotton ginning industry, and funding support from partners in the form of unsecured loans. Outlook: Stable CRISIL believes that Minakshi will continue to benefit over the medium term from its promoters' extensive industry experience and funding support. The outlook may be revised to 'Positive' if there is substantial and sustained growth in the firm's revenues and profitability from the current level, or if there is an improvement in its capital structure, most likely through fresh capital infusion. Conversely, the outlook may be revised to 'Negative' if Minakshi's liquidity weakens significantly, most likely because of substantially less-than-expected cash accruals or large working capital requirements. Minakshi was set up in 2003 as a partnership firm by the Tayal family of Madhya Pradesh. The firm has two units in Georai and Khamgaon (Maharashtra), where it undertakes cotton ginning and pressing. MULPURI FOODS: CRISIL Upgrades Rating on INR620MM Loan to 'B' ------------------------------------------------------------- CRISIL has upgraded its rating on the long-term bank facilities of Mulpuri Foods and Feeds Private Limited (MFFPL; part of the Mulpuri group) to 'CRISIL B/Stable' from 'CRISIL D'. Amount Facilities (INR Mln) Ratings ---------- --------- ------- Cash Credit 620 CRISIL B/Stable (Upgraded from 'CRISIL D') Long Term Loan 150.8 CRISIL B/Stable (Upgraded from 'CRISIL D') The upgrade reflects timely servicing of debt by the group over the four months through June 2016. The upgrade also factors in CRISIL's belief that the group will continue to meet its debt obligations in a timely manner over the medium term, backed by continued funding support from promoters. The rating reflects the group's below-average financial risk profile, working capital-intensive operations, and exposure to risks inherent in the poultry and aqua-culture industries. These rating weaknesses are partially offset by an established regional market position in the poultry and aqua-culture industries and the extensive industry experience of its promoter. For arriving at its rating, CRISIL has combined the business and financial risk profiles of MFFPL, Mulpuri Fisheries Pvt Ltd (MFPL), Mulpuri Poultries (MP), and Sri Venkateswara Poultry Farm (SVPF). This is because all these entities, together referred as the Mulpuri group, have a common management, and significant intra-group operational and financial linkages. Furthermore, there are cross corporate guarantees extended to each other. Outlook: Stable CRISIL believes the Mulpuri group will continue to benefit over the medium term from the extensive industry experience of its promoter. The outlook may be revised to 'Positive' if there is a substantial and sustained increase in revenue and profitability margins, or continued improvement in working capital management. The outlook may be revised to 'Negative' in case of a steep decline in profitability margins, or significant deterioration in the capital structure of the group caused most likely by large, debt-funded capital expenditure or a stretched working capital cycle. The Mulpuri group was set up by Mr. Lakshmana Swamy who has more than three decades of experience in the poultry industry. The group is based in Vijayawada, Andhra Pradesh. SVPF, established in1992, and MP, established in 2003, sell hatching eggs. MFFPL, incorporated in 2009, manufactures floating fish feed and poultry feed. MFPL, was incorporated in 2009, breeds Pangasius and Indian carp fish. MULPURI POULTRIES: CRISIL Ups Rating on INR150MM Cash Loan to B --------------------------------------------------------------- CRISIL has upgraded its rating on the bank facilities of Mulpuri Poultries (MP; part of the Mulpuri group) to 'CRISIL B/Stable' from 'CRISIL D'. Amount Facilities (INR Mln) Ratings ---------- --------- ------- Cash Credit 150 CRISIL B/Stable (Upgraded from 'CRISIL D') Long Term Loan 131.1 CRISIL B/Stable (Upgraded from 'CRISIL D') The upgrade reflects timely servicing of debt by the group over the four months through June 2016. The upgrade also factors in CRISIL's belief that the group will continue to meet its debt obligations in a timely manner over the medium term, backed by continued funding support from promoters. The rating reflects the group's below-average financial risk profile, working capital-intensive operations, and exposure to risks inherent in the poultry and aqua-culture industries. These rating weaknesses are partially offset by an established regional market position in the poultry and aqua-culture industries and the extensive industry experience of its promoter. For arriving at its rating, CRISIL has combined the business and financial risk profiles of MP, Mulpuri Foods and Feeds Pvt Ltd (MFFPL), Mulpuri Fisheries Pvt Ltd (MFPL), and Sri Venkateswara Poultry Farm (SVPF), together referred as the Mulpuri group. This is because all these entities, together referred as the Mulpuri group, have a common management, and significant intra-group operational and financial linkages. Furthermore, there are cross corporate guarantees extended to each other. Outlook: Stable CRISIL believes the Mulpuri group will continue to benefit over the medium term from the extensive industry experience of its promoter. The outlook may be revised to 'Positive' if there is a substantial and sustained increase in revenue and profitability margins, or continued improvement in working capital management. The outlook may be revised to 'Negative' in case of a steep decline in profitability margins, or significant deterioration in the capital structure of the group caused most likely by large, debt-funded capital expenditure or a stretched working capital cycle. The Mulpuri group was set up by Mr. Lakshmana Swamy who has more than three decades of experience in the poultry industry. The group is based in Vijayawada, Andhra Pradesh. SVPF, established in1992, and MP, established in 2003, sell hatching eggs. MFFPL, incorporated in 2009, manufactures floating fish feed and poultry feed. MFPL, was incorporated in 2009, breeds Pangasius and Indian carp fish. NANDRAJ RICE: Ind-Ra Suspends 'IND B-' Long-Term Issuer Rating -------------------------------------------------------------- India Ratings and Research (Ind-Ra) has migrated Nandraj Rice Mill's (NARM) 'IND B-' Long-Term Issuer Rating to the suspended category. The Outlook was Stable. The rating will now appear as 'IND B-(suspended)' on the agency's website. The agency has also migrated the ratings on NARM's INR70m fund-based working capital limits to Long-term 'IND B-(suspended)' and Short-term 'IND A4(suspended)' from 'IND B-' and 'IND A4' The ratings have been migrated to the suspended category due to lack of adequate information. Ind-Ra will no longer provide ratings or analytical coverage for NARM. The ratings will remain in the suspended category for a period of six months and be withdrawn at the end of that period. However, in the event the issuer starts furnishing information during this six-month period, the ratings could be reinstated and will be communicated through a rating action commentary. NARMADA SPINNING: CRISIL Raises Rating on INR200MM Loan to B+ ------------------------------------------------------------- CRISIL has upgraded its rating on long term bank facilities of Narmada Spinning Private Limited (NSPL) to 'CRISIL B+/Stable' from 'CRISIL B/Stable', whereas the short term rating is re- affirmed at 'CRISIL A4'. Amount Facilities (INR Mln) Ratings ---------- --------- ------- Bank Guarantee 16.5 CRISIL A4 (Reaffirmed) Cash Credit 30.0 CRISIL B+/Stable (Upgraded from 'CRISIL B/Stable') Proposed Long Term 3.5 CRISIL B+/Stable (Upgraded Bank Loan Facility from 'CRISIL B/Stable') Term Loan 200.0 CRISIL B+/Stable (Upgraded from 'CRISIL B/Stable') The rating upgrade reflects improvement in the business risk profile, led by successful ramp-up in scale of operations. Extensive industry experience of promoters and established relationships with customers and suppliers have resulted in higher-than-expected operating income estimated around INR446.4 million, in Fiscal 2016, the first year of operations. The business risk profile is also supported by comfortable operating margin of 13.9% estimated for Fiscal 2016. CRISIL expects sustained growth in revenue and moderate profitability over the medium term. The financial risk profile is above-average, led by moderately high gearing of 2.12 times, estimated as on March 31, 2016, and healthy debt protection metrics, marked by interest coverage of 2.23 times, estimated as on March 31, 2016. The rating continues to reflect the short track record and moderate scale of operations, amidst intense competition in the textile industry and average financial risk profile. These rating weaknesses are partially offset by extensive industry experience of promoters and established relationships with customers and suppliers. Outlook: Stable CRISIL believes that NSPL will continue to benefit from extensive experience of promoters in the textile industry. The outlook may be revised to 'Positive' if the company reports substantial growth in scale of operations, while maintaining profitability and the working capital cycle. The outlook may be revised to 'Negative' if revenue or profitability declines significantly or if a huge, debt-funded capital expenditure weakens the business and financial risk profile. Incorporated in Fiscal 2014, NSPL is engaged in manufacturing of open-end spinning yarn. The company has been promoted by the Morbi-based Dhamsania family and commenced commercial operations in April 2015. NAROL TEXTILE: CRISIL Assigns B+ Rating to INR624.8MM Term Loan --------------------------------------------------------------- CRISIL has assigned its 'CRISIL B+/Stable/CRISIL A4' ratings to the bank loan facilities of Narol Textile Infrastructure & Enviro Management (NTIEM). Amount Facilities (INR Mln) Ratings ---------- --------- ------- Bank Guarantee 50 CRISIL A4 Term Loan 624.8 CRISIL B+/Stable The ratings reflect NTIEM's exposure to project implementation related risks and to timely stabilisation and commensurate ramp- up in sales during its initial phase of operations. These rating weaknesses are partly mitigated by NTIEM's exclusivity and tie up with many textile processors and other units in Narol cluster, near Ahmedabad (Gujarat) for operating common effluent collection, conveyance, treatment and disposal facilities, and funding support it receives from members' contribution and government grants. Outlook: Stable CRISIL believes NTIEM will benefit over the medium term from its exclusive arrangement with processing units in its area. The outlook may be revised to 'Positive' in case of timely implementation and stabilisation of the project leading to anticipated revenue and cash accruals during initial phase of operations. The outlook may be revised to 'Negative' if there is delay in implementation or stabilisation of the project leading to lower revenue, cash accruals or stretch in working capital cycle adversely impacting financial risk profile, especially liquidity. NTIEM was established in 2010, promoted by various textile units in the Narol textile cluster of Ahmedabad, for establishing CETP facilities for the benefit of members with an objective of attaining a clean and green environment. The project is under implementation and is expected to start commercial operations in 2016-17. OSHO FORGE: CRISIL Lowers Rating on INR400MM Cash Loan to B+ ------------------------------------------------------------ CRISIL has downgraded its ratings on the bank facilities of Osho Forge Limited (OFL; part of the Emson group) to 'CRISIL B+/Stable/CRISIL A4' from 'CRISIL BB/Stable/CRISIL A4+'. Amount Facilities (INR Mln) Ratings ---------- --------- ------- Cash Credit 400 CRISIL B+/Stable (Downgraded from 'CRISIL BB/Stable') Overdraft Facility 50 CRISIL A4 (Downgraded from 'CRISIL A4+') Proposed Long Term 90 CRISIL B+/Stable (Downgraded Bank Loan Facility from 'CRISIL BB/Stable') Term Loan 110 CRISIL B+/Stable (Downgraded from 'CRISIL BB/Stable') The downgrade reflects CRISIL's belief that Emson group's liquidity will remain stretched on account of large repayment obligations of around INR171 million in fiscal 17. Large debt was contracted for the expansion of facilities in fiscal 14 and 15, however sluggish demand in the automotive sector restricted ramp up of operations, leading to moderation in profitability; and operating income to gross block ratio slipping to less than 1 time. Although, demand has improved in the first quarter of fiscal 17, mainly from the tractor industry; in anticipation of a healthy monsoon, the expected net cash accrual will be tightly matched against maturing debt obligations. Consequently, incremental working capital requirement will be debt funded and in turn will keep current ratio weak at 0.9 time. In fiscal 16, the shortfall in cash accruals against maturing debt obligations of INR274 million was primarily met by refinancing/incurring additional debt. The rating continues to reflect working capital intensive operations, stretched liquidity on account of large maturing debt, and end-user concentration leading to exposure to macro- economic factors of the industry and impact, thereof. The weaknesses are partially offset by the established position, and integrated operations supporting profitability. For arriving at the rating, CRISIL has combined the business and financial risk profiles of OFL and Emson Gears Ltd (EGL). This is because these companies, collectively referred to as the Emson group, operate in the same line of business and are under a common management. OFL manufactures gears, crown wheels, and pinions, all of which are used as raw material by EGL. CRISIL used to consolidate Osho Gears and Pinion Ltd (OGPL) also, however, the same is now merged with EGL. Outlook: Stable CRISIL believes the Emson group will continue to benefit from its established market position in the automotive components segment. The outlook may be revised to 'Positive' if significant ramp up in operations while maintaining/improving profitability leads to higher cash accruals. The outlook may be revised to 'Negative' if working capital requirement or lower-than-expected cash accruals or large debt-funded capital expenditure weaken the financial risk profile, especially liquidity. The Emson group comprises EGL and OFL. EGL was established as a partnership firm, Emson Sales, in 1981. The firm, founded by Mr Ashok Kumar Dhall and Mr Vimal Dhall, manufactures gears and was reconstituted as a limited company in 1981. In 1993, the group established OFL to implement vertical integration into the forgings segment. In the same year, another facility to manufacture gears and pinions was set up under OGPL, the same is now merged with EGL. P. K. INDUSTRIES: CARE Upgrades Rating on INR4cr Loan to BB- ------------------------------------------------------------ CARE revises the LT rating and reaffirms the ST rating assigned to the bank facilities of P. K. Industries. Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long-term Bank Facilities 4 CARE BB- Revised from CARE B+ Short-term Bank Facilities 6 CARE A4 Reaffirmed Rating Rationale The revision in the long-term rating assigned to the bank facilities of P. K. Industries (PKI) is primarily due to improvement in the total operating income (TOI), increase in cash accruals coupled with improvement in profit margins, debt coverage indicators and liquidity position during FY16 (refers to the period April 1 to March 31). The ratings continue to draw strength from the vast experience of the proprietor in the transformer industry and its stable association with reputed clientele. The ratings, however, continue to remain constrained on account of its leveraged capital structure and working capital intensive nature of operations. PKI's ability to increase the scale of operations coupled with improvement in capital structure as well as better working capital management remain the key rating sensitivities. Bhopal-based (Madhya Pradesh) P. K. Industries (PKI) was formed in 2000 as a proprietorship firm by Mr Prashant K Gupta. The firm is ISO 9001: 2008 certified entity and it is engaged into the business of manufacturing of power and distribution transformers.PKI manufactures transformers from capacity of 5 Kilo Volt Ampere (KVA) to 5 Mega Volt Ampere (MVA) and supplies the same to State Electricity Boards (SEB's) in Madhya Pradesh and Rajasthan and other private customers who take contract from government departments. During FY16, PKI reported total operating income (TOI) of INR20.04 crore with PAT of INR0.82 crore as compared with TOI of INR7.92 crore and PAT of INR0.31 crore during FY15. During Q1FY17 (Prov.), PKI has achieved a turnover of INR6.25 crore. PARAMOUNT SEAFOODS: CRISIL Reaffirms B+ Rating on INR25MM Loan -------------------------------------------------------------- CRISIL's ratings on the bank facilities of Paramount Seafoods (Paramount) continue to reflect its below-average financial risk profile, marked by weak debt protection metrics and modest net worth. The ratings also factor in the firm's susceptibility to volatility in raw material prices and to fluctuations in foreign exchange rates. Amount Facilities (INR Mln) Ratings ---------- --------- ------- Foreign Bill Discounting 45 CRISIL A4 (Reaffirmed) Foreign Bill Discounting 25 CRISIL B+/Stable (Reaffirmed) Packing Credit 50 CRISIL A4 (Reaffirmed) Proposed Term Loan 20 CRISIL B+/Stable (Reaffirmed) These rating weaknesses are partially offset by the extensive experience of promoters in the seafood industry. Outlook: Stable CRISIL believes that Paramount 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 significant improvement in revenue and profitability, leading to a substantial increase in cash accrual, while also strengthening its capital structure. Conversely, the outlook may be revised to 'Negative' in case of low cash accrual, a stretched working capital cycle, or any large capital expenditure, resulting in deterioration in the financial risk profile, especially liquidity. Paramount, set up in 2011, exports frozen marine products. The firm is promoted by Mr. A M Gafoor and his family. PAREKH ALUMINEX: CRISIL Reaffirms D Rating on INR8.55BB Loan ------------------------------------------------------------ CRISIL's ratings on the bank facilities and non-convertible debentures of Parekh Aluminex Limited (PAL) continue to reflect delays in servicing debt, as per CRISIL's discussions with PAL's lenders. Efforts to resolve cash flow mismatch have not been successful since the demise of then chairman and managing director, Mr. Amitabh Arun Parekh, in January 2013; he was the key management person supervising operations. Amount Facilities (INR Mln) Ratings ---------- --------- ------- Cash Credit 3450 CRISIL D (Reaffirmed) Letter of Credit 550 CRISIL D (Reaffirmed) Letter of credit & Bank Guarantee 900 CRISIL D (Reaffirmed) Proposed Long Term Bank Loan Facility 8550 CRISIL D (Reaffirmed) Incorporated in 1994, PAL manufactures aluminium foil containers (AFC), lids, covers, and allied products used in packaging food items. Manufacturing units are in Dadra and Nagar Haveli. In 2005, PAL acquired a Singapore-based company to enter the Southeast Asian markets. In 2008, its units acquired export oriented-unit status. The company entered the retail space with two brands, PAL and ME Foil, in fiscal 2011. It has annual production capacities of 6880 million pieces of AFC, 39.6 million pieces of foil roll, and 1790 million pieces of foil lids. PAL incurred a loss of INR3.8 billion on net sales of INR10.9 billion for fiscal 2013, against a profit after tax of INR846.6 million on net sales of INR13.7 billion for fiscal 2012. No financials have been released since June 2013. PRIME URBAN: CRISIL Puts 'B' Rating on Notice of Withdrawal ----------------------------------------------------------- CRISIL has placed its ratings on the bank facilities of Prime Urban Development India Limited (PUDIL) on 'Notice of Withdrawal' for a period of 180 days on PUDIL's request. The ratings will be withdrawn at the end of the notice period. The rating action is in line with CRISIL's policy on withdrawal of its ratings on bank loans. Amount Facilities (INR Mln) Ratings ---------- --------- ------- Export Bill 250 CRISIL B/Stable (Notice Negotiation of Withdrawal) Packing Credit 50 CRISIL A4 (Notice of Withdrawal) Outlook: Stable CRISIL believes that PUDIL will continue to benefit over the medium term from the promoters long standing presence in the industry. The outlook may be revised to 'Positive' in case PUDIL reports significantly higher-than-expected growth in cash flow from operations, thereby translating into an improvement in its financial risk profile. Conversely, the outlook may be revised to 'Negative' if the company faces a stretch in its working capital cycle, or if the cash flow from operations in respect of its real estate segment is significantly below expectations. PUDIL was incorporated in 1936 by the Patodia family, headed by Late Mr.Madanlal Patodia. The operations of the company are currently being managed by the third generation of the Patodia family- Mr.Manoj Patodia and Mr. Anuj Patodia. The company is engaged in the trading of cotton yarn. The company is also engaged in real estate development through three partnership firms in which the company is a partner. These firms are- Prime New Line AOP, Prime Developers and Prime Mall Developers. PUDIL is listed on the Bombay Stock Exchange. R V PLASTIC: Ind-Ra Suspends 'IND B+' Long-Term Issuer Rating ------------------------------------------------------------- India Ratings and Research (Ind-Ra) has migrated R V Plastic Limited's (RVPL) 'IND B+' Long-Term Issuer Rating to the suspended category. The Outlook was Stable. This rating will now appear as 'IND B+(suspended)' on the agency's website. The ratings have been migrated to the suspended category due to lack of adequate information. Ind-Ra will no longer provide ratings or analytical coverage for RVPL. The ratings will remain in the suspended category for a period of six months and be withdrawn at the end of that period. However, in the event the issuer starts furnishing information during this six-month period, the ratings could be reinstated and will be communicated through a rating action commentary. RVPL's ratings: -- Long-Term Issuer Rating: migrated to 'IND B+(suspended)' from 'IND B+'/Stable -- INR100.00 million fund-based limits: migrated to 'IND B+(suspended)'/'IND A4(suspended)' from 'IND B+'/'IND A4' -- INR70.00 million non-fund-based bank guarantees: migrated to 'IND A4(suspended)' from 'IND A4' RAJ SALT: CARE Upgrades Rating on INR4.40cr LT Loan to BB- ---------------------------------------------------------- CARE revises the LT rating and reaffirms the ST rating assigned to the bank facilities of Raj Salt & Chemicals Pvt. Ltd. Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long-term Bank Facilities 4.40 CARE BB- Revised from CARE B+ Short-term Bank Facilities 8.00 CARE A4 Reaffirmed Rating Rationale The revision in the ratings of Raj Salt & Chemicals Pvt. Ltd (RSPL) takes into cognizance improvement in the financial risk profile in FY16 (refers to the period April 01 to March 31) vis- Ö-vis FY15 marked by improvement in total operating income, capital structure & debt service coverage indicators and improvement in liquidity position and operating cycle. However, the ratings continue to be constrained by small scale of operation and low profitability margin, stiff competition due to fragmented nature of the industry, exposure to volatility in the cashew nut prices and forex rates, highly competitive and working capital intensive nature of operation. The ratings, however, continue to draw comfort from the experience of the promoters; however, lacking experience in the trading of food products coupled with long track record of operations. Going forward, the ability of the entity to improve its scale of operations along with profit margins and effective working capital management would be the key rating consideration. RSPL was incorporated in March 1995 by Mr Bajrang Lal Agarwal and Mr Ritesh Agarwal of Kharagpur, West Bengal. The company was initially engaged in manufacturing of salt & chemicals and wax since inception. However, since April 2013, RSPL stopped the manufacturing operations and started trading in cashew nuts. The unit is located at Medinipore, West Bengal. The company imports its trading materials from Ivory Coast, Ghana, etc. and sells the products fully in the domestic market. Currently, the day-to-day affairs of the company are managed by Mr Bajrang Lal Agarwal with adequate support from the other director and a team of experienced personnel. In FY16 (A), the firm has reported a total operating income of INR23.83 crore (as against INR17.03 crore in FY15) and PAT of INR0.09 crore (as against PAT of INR0.06 crore in FY15). RATTAN LAL: CRISIL Suspends 'D' Rating on INR195MM Term Loan ------------------------------------------------------------ CRISIL has suspended its rating on the bank facility of Rattan Lal Jindal Educational Trust (RJET). Amount Facilities (INR Mln) Ratings ---------- --------- ------- Term Loan 195 CRISIL D The suspension of rating is on account of non-cooperation by RJET with CRISIL's efforts to undertake a review of the ratings outstanding. Despite repeated requests by CRISIL, RJET is yet to provide adequate information to enable CRISIL to assess RJET'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' RJET was founded in 2009 by members of the Jindal family comprising Mr. Hariram Gupta, his wife, Mrs. Santosh Gupta, son, Mr. Yogesh Gupta, daughter-in-law, Mrs. Sonal Gupta, and daughter, Ms. Usha Gupta. The trust operates the GD Goenka International School under the GD Goenka School franchise; the school, based in Sonepat (Haryana), is affiliated to the Central Board of Secondary Education. RJET is also operating two play schools under the La Petite brand of the GD Goenka School franchise, one in Kundli (Himachal Pradesh) and the other in Preet Vihar (Delhi). RJET started operations with its first batch of students in April 2012. SABOO TOR: Ind-Ra Suspends 'IND BB' Long-Term Issuer Rating ----------------------------------------------------------- India Ratings and Research (Ind-Ra) has migrated Saboo Tor Private Limited's (STPL) 'IND BB' Long-Term Issuer Rating to the suspended category. The Outlook was Stable. The rating will now appear as 'IND BB(suspended)' on the agency's website. The agency has also migrated STPL's INR105 million fund-based limits to 'IND BB(suspended)' from 'IND BB'. The ratings have been migrated to the suspended category due to lack of adequate information. Ind-Ra will no longer provide ratings or analytical coverage for STPL. The ratings will remain in the suspended category for a period of six months and be withdrawn at the end of that period. However, in the event the issuer starts furnishing information during the six-month period, the ratings could be reinstated and will be communicated through a rating action commentary. SAHA BUILDING: CRISIL Reaffirms B+ Rating on INR40MM Cash Loan -------------------------------------------------------------- CRISIL's ratings on the bank facilities of Saha Building Centre Private Limited (SBCPL) continue to reflect the company's large working capital requirement and modest scale of operations in the fragmented and competitive civil construction industry. These weaknesses are partially offset by the industry experience of its promoters. Amount Facilities (INR Mln) Ratings ---------- --------- ------- Bank Guarantee 35 CRISIL A4 (Reaffirmed) Cash Credit 40 CRISIL B+/Stable (Reaffirmed) Proposed Long Term Bank Loan Facility 20 CRISIL B+/Stable (Reaffirmed) Outlook: Stable CRISIL believes SBCPL will continue to benefit over the medium term from its promoters' industry experience. The outlook may be revised to 'Positive' in case of significant increase in the company's revenue and accrual, or improvement in its working capital management, leading to a better financial risk profile, especially liquidity. Considerably low accrual, or stretch in working capital cycle, or large debt-funded capital expenditure, leading to deterioration in the company's financial risk profile, particularly liquidity, may lead to a revision in the outlook to 'Negative'. SBCPL was set up in 1999 as a proprietorship firm, and was reconstituted as a private limited company in 2008. It undertakes civil construction, mainly of buildings. The daily operations are managed by its director Mr. Apurba Kumar Saha. SAI MAATARINI: Ind-Ra Suspends 'IND BB' Term Loan Facility Rating ----------------------------------------------------------------- India Ratings and Research (Ind-Ra) has migrated the 'IND BB' rating on Sai Maatarini Tollways Limited's (SMTL) INR13,973.5 million term loan facility to the suspended category. The Outlook was Negative. The rating will now appear as 'IND BB(suspended)' on the agency's website. The rating has been suspended due to lack of adequate information. Ind-Ra will no longer provide ratings or analytical coverage for SMTL. The rating will remain suspended category for a period of six months and be withdrawn at the end of that period. However, in the event the issuer starts furnishing information during this six-month period, the rating could be reinstated and will be communicated through a rating action commentary. SANTOSHI RICE: CARE Reaffirms B+ Rating on INR5.80cr LT Loan ------------------------------------------------------------ CARE reaffirms the rating assigned to the bank facilities of Santoshi Rice And General Mills. Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long-term Bank Facilities 5.80 CARE B+ Suspension revoked and rating reaffirmed Rating Rationale The rating assigned to the bank facilities of Santoshi Rice and General Mills (SRM) continues to remain constrained by its weak financial risk profile marked by small scale of operations, low profitability margins and leveraged capital structure & weak coverage indicators. The rating is further constrained by working capital-intensive nature of operations, partnership nature of constitution, business susceptible to the vagaries of nature and its presence in a highly competitive and fragmented agro-processing business with a high level of government control. The rating, however, draws strength from the experienced partners in the agro-processing industry and long track record of operation of the entity, growing scale of operations and favorable manufacturing location. Going forward, the ability of SRM to scale up its operations with improvement in the profitability margins and capital structure along with effective working capital management shall be the key rating sensitivities. Karnal-based, (Haryana) SRM was established as a partnership firm in 1986 by two partners namely Mr Pawan Kumar and Mr Kanti Prasad, sharing profits and loss equally. They collectively look after the overall operations of the firm. The firm is engaged in milling and processing of paddy, with a total installed capacity of 32,000 metric ton per annum (MTPA) as on March 31, 2016. SRM procures paddy from local grain markets through dealers and agents mainly from the state of Haryana. The firm sells basmati and non-basmati rice in the states of Delhi, Haryana and Punjab through a network of commission agents and traders. SRM has achieved a total operating income (TOI) of INR36.30 crore with PBILDT and profit after tax (PAT) of INR1.34 crore and INR0.03 crore, respectively, in FY15 (refers to the period April 1 to March 31) as against TOI INR29.44 crore with a PBILDT and PAT of INR0.88 and INR0.01 crore, respectively, in FY14. Furthermore, during FY16, the entity achieved TOI of INR11.90 crore (as per the unaudited results). SATIJA MOTORS: CRISIL Assigns B+ Rating to INR45MM Cash Loan ------------------------------------------------------------ CRISIL has assigned its 'CRISIL B+/Stable/CRISIL A4' ratings to the bank facilities of Satija Motors Pvt Ltd (SMPL). Amount Facilities (INR Mln) Ratings ---------- --------- ------- Bank Guarantee 20 CRISIL A4 Cash Credit 45 CRISIL B+/Stable The ratings reflect SMPL's modest scale of and working capital- intensive operations in the intensely competitive automobile dealership business and below-average financial risk profile because of a small networth and leveraged capital structure. These rating weaknesses are partially offset by the extensive experience of promoters in the automobile dealership industry, their funding support, and healthy relations with principals. For arriving at the ratings, CRISIL has treated unsecured loans of INR19.7 million as on March 31, 2015, extended by promoters, as neither debt nor equity. This is because these are expected to be retained in the business over the medium term. Outlook: Stable CRISIL believes SMPL will benefit from the extensive industry experience of promoters and their healthy relations with principals. The outlook may be revised to 'Positive' in case of significant improvement in financial risk profile backed by considerably higher cash accrual or equity infusion by promoters. Conversely, the outlook may be revised to 'Negative' if low accrual, most likely on account of a decline in revenue or profitability, or large, debt-funded capex leads to deterioration in the financial risk profile, particularly liquidity. SMPL was earlier established in 1984 as a partnership firm, Satija Motor Cycle, for setting up authorised dealership of Yamaha Motors Pvt Ltd two-wheelers. In November 1990, the firm was reconstituted as a private limited company with its present name. In 2002, it added dealership of Mahindra & Mahindra Ltd tractors. SMPL, promoted by the Satija family and managed by Mr. Nikish Satija, and is based in Chhindwara (Madhya Pradesh). SHREE BALAJI: CARE Assigns B- Rating to INR4.80cr LT Loan --------------------------------------------------------- CARE assigns 'CARE B-' rating to the bank facilities of Shree Balaji Steel. Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long term Bank Facilities 4.80 CARE B- Assigned Rating Rationale The rating assigned to the bank facilities of Shree Balaji Steel (SBS) is constrained by its small scale of operations, weak financial profile with net loss in FY15 (refers to the period April 1 to March 31), risk associated with trading nature of business and competitive and fragmented nature of the industry and constitution as a proprietorship firm limiting financial flexibility. The rating also factors in leveraged capital structure and weak debt protection metrics. The above constraints outweigh the comfort derived from the experience of the proprietor. The ability of the entity to improve its scale of operation, improve its financial profile and profitability along with efficient management of working capital are the key rating sensitivities. SBS, based out of Nagpur (Maharashtra) is a proprietorship entity promoted by Mr Radheshyam Sarda and commenced operation in January, 1981. SBS is engaged in trading of iron & steel products such as Thermo Mechanically Treated (TMT) bars, round bars, angles, channels, beams, flats, sheets, etc. which find application in industries like construction, infrastructure and engineering. The entity has its registered office and servicing facility based in Nagpur. The servicing facility is rented and has an area of 800 sq. ft. The entity procures materials from domestic suppliers players based in Nagpur and sells its products in the state of Maharashtra and Chhattisgarh. During FY15 (refers to the period April 1 to March 31), SBS posted a net loss of INR0.26 crore on a total income of INR15.04 crore as against a PAT of INR0.10 crore on a total income of INR10.02 crore for FY14. Furthermore, the entity has achieved a turnover of INR8 crore during FY16 (provisional). SHREE MORAYA: CRISIL Assigns B+ Rating to INR60MM Term Loan ----------------------------------------------------------- CRISIL has assigned its 'CRISIL B+/Stable' rating to the long- term bank facilities of Shree Moraya Polymers Private Limited (SMPPL). Amount Facilities (INR Mln) Ratings ---------- --------- ------- Cash Credit 20 CRISIL B+/Stable Rupee Term Loan 60 CRISIL B+/Stable The rating reflects SMPPL's small scale of operations and weak financial risk profile, marked by low networth and high gearing. The rating also factors in working capital intensity in operations and volatility in raw material prices. These rating weaknesses are partially offset by the extensive experience of the promoters and healthy relationship with key customer, Bisleri International Pvt Ltd (Bisleri). Outlook: Stable CRISIL believes that SMPPL will continue to benefit from its established customer relationships and the experience of its promoters. The outlook may be revised to Positive' if ramp-up in scale of operations results in stronger cash accrual and financial risk profile. Conversely, the outlook may be revised to 'Negative' if delay in stabilising operations, significantly constrains the financial metrics, including liquidity. Incorporated in February 2013, SMPPL manufactures PET bottles for Bisleri. SMPPL began commercial operations in September 2013. The company is promoted by Mr. Santosh Sawant, Mr. Ajay Galande and Mr. Rohidas Landhghe, and is based in Pune, Maharashtra. SMS INTERNATIONAL: CRISIL Reaffirms B+ Rating on INR48.8MM Loan --------------------------------------------------------------- CRISIL's ratings on the bank facilities of SMS International Beverages Private Limited (SMS) continue to reflect a weak financial risk profile because of high gearing, below-average debt protection metrics, and a small networth. Amount Facilities (INR Mln) Ratings ---------- --------- ------- Bank Guarantee 1 CRISIL A4 (Reaffirmed) Cash Credit 30 CRISIL B+/Stable (Reaffirmed) Letter of Credit 15 CRISIL A4 (Reaffirmed) Proposed Long Term Bank Loan Facility 24.3 CRISIL B+/Stable (Reaffirmed) Term Loan 48.8 CRISIL B+/Stable (Reaffirmed) The ratings also factor in a modest scale of operations in the intensely competitive food processing segment. These rating weaknesses are partially offset by the extensive industry experience of the company's promoters and their funding support. Outlook: Stable CRISIL believes SMS 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 a significant increase in scale of operations along with improved profitability, leading to a better capital structure. The outlook may be revised to 'Negative' if the financial risk profile deteriorates, most likely because of lower-than-expected cash accrual or large working capital requirement. Update Net sales and operating margin are estimated at about INR200 million and 9.0%, respectively, for fiscal 2016, against INR159.6 million and 7.3%, respectively, in the previous fiscal. The improvement in sales was because of increased sales volumes from recently added distributors/stockists supported by a pan-India distribution network. Consequently, operating profitability improved, supported by better negotiation of prices for imported tetra packs with suppliers. Net sales and operating margin are expected to remain at INR220-250 million and 8.5%, respectively, over the medium term, supported by improving brand penetration. Total outside liabilities to tangible networth (TOLTNW) ratio was high, estimated at 7.8-8.0 times as on March 31, 2016, because of large debt contracted for setting up the plant. The ratio may, however, improve sharply after receipt of subsidy from MFPI (Ministry of Food Processing Industries), estimated at INR40 million. This will be utilised towards repayment of existing term loans. If the subsidy is not received, the TOLTNW ratio will improve only gradually on account of moderate accretion to reserves. Interest coverage and net cash accrual to total debt ratios are estimated at 1.8 times and 0.08 times, respectively, for fiscal 2016. Debtors are estimated at 10-15 days and inventory at 130 days as on March 31, 2016. Without the subsidy, cash accrual is likely to be tightly matched against maturing debt in fiscal 2017. Dependency on bank limit remains high, reflected in average utilisation of around 95% in the 12 months through March 2016. SMS was established in 2013 in Solan, Himachal Pradesh, promoted by Mr. Mool Chand Garg, Mr. Sanjay Mittal, and Mr. Sudheer Gupta. The company manufactures food products, including fruit juices, fruit drinks, jams and jellies; it commenced production in January 2014. It sells juices under the Pulpy Fresh brand. SORENTO GRANITO: CARE Reaffirms B+ Rating on INR2.04cr LT Loan -------------------------------------------------------------- CARE reaffirms the ratings assigned to the bank facilities of Sorento Granito Private Limited. Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long-term Bank Facilities 2.04 CARE B+ Reaffirmed Long-term/Short term Bank Facilities 17.75 CARE B+/CARE A4 Reaffirmed Rating Rationale The ratings assigned to the bank facilities of Sorento Granito Private Limited (SGPL) continue to remain constrained on account moderate scale of operations, low profit margins, moderately leveraged capital structure, weak debt coverage indicators and moderate liquidity position. The ratings also remain constrained on account of susceptibility of margins to volatility in raw material and fuel prices, customer concentration risk and its presence in the highly fragmented vitrified tile industry with fortunes linked with the cyclical real estate market. The ratings also take into consideration significant decline in turnover, profitability and cash accruals coupled with elongation in operating cycle during FY16 (Provisional, refers to the period April 1 to March 31). The ratings, however, continue to draw strength from vast experience of the promoters in the tiles manufacturing business, well-established relationship with customers & suppliers and location advantage through its presence in the tile cluster of Gujarat. The ability of SGPL to increase its scale of operations and improve its overall financial risk profile by improving profitability and capital structure while efficiently managing the working capital requirements remain the key rating sensitivities. Incorporated in 2007, Morbi-based SGPL is engaged in the manufacturing of vitrified tiles. Its plant has daily installed capacity of 7,500 boxes of tiles size 2' X 2' square feet. It sells its product under the brand name of "Sorento". SGPL is promoted by Mr Bhagwandas Tulsiyani along with Mr Hasmukhlal Ubhadiya, Mr Murlibhai Tulsiyani andMr Narendra Kagthara. During FY15, SGPL reported a total operating income (TOI) of INR82.76 crore with a PAT of INR0.66 crore as against TOI of INR49.36 crore with a PAT of INR0.13 crore in FY15. During FY16 (Provisional), SGPL reported a TOI of INR48 crore. SRI DHARAM: CRISIL Cuts Rating on INR145MM LT Loan to 'D' --------------------------------------------------------- CRISIL has downgraded the rating on the long-term bank facility of Sri Dharam Educational Trust (SDET) to 'CRISIL D' from 'CRISIL B/Stable'. Amount Facilities (INR Mln) Ratings ---------- --------- ------- Long Term Loan 145 CRISIL D (Downgraded from 'CRISIL B/Stable') The rating downgrade reflects instances of delay by SDET in servicing its debt repayment obligations on account of weak liquidity arising out of cash flow mismatch. SDET is also vulnerable to the intense competition from other educational institutes in the region of its operation. However, the trust benefits from the management's extensive industry experience. Set up in 2013, SDET runs a nursery school in Tindivanam (Tamil Nadu), Aakrutii School and a secondary school (Sri Dharamchand Jain School) affiliated to Central Board of Secondary Education (CBSE). Mr. H Bablasa is the key promoter-trustee who looks after the trust's operations. SRI VENKATESWARA: CRISIL Upgrades Rating on INR234.8MM Loan to B ---------------------------------------------------------------- CRISIL has upgraded its rating on the long-term bank facilities of Sri Venkateswara Poultry Farm (SVPF; part of the Mulpuri groups) to 'CRISIL B/Stable' from 'CRISIL D'. Amount Facilities (INR Mln) Ratings ---------- --------- ------- Cash Credit 150 CRISIL B/Stable (Upgraded from 'CRISIL D') Long Term Loan 234.8 CRISIL B/Stable (Upgraded from 'CRISIL D') The upgrade reflects timely servicing of debt by the group over the four months through June 2016. The upgrade also factors in CRISIL's belief that the group will continue to meet its debt obligations in a timely manner over the medium term, backed by continued funding support from promoters. The rating reflects the group's below-average financial risk profile, working capital-intensive operations, and exposure to risks inherent in the poultry and aqua-culture industries. These rating weaknesses are partially offset by an established regional market position in the poultry and aqua-culture industries and the extensive industry experience of its promoter. For arriving at its rating, CRISIL has combined the business and financial risk profiles of SVPF, Mulpuri Foods and Feeds Pvt Ltd (MFFPL), Mulpuri Fisheries Pvt Ltd (MFPL), and Mulpuri Poultries (MP). This is because all these entities, together referred as the Mulpuri group, have a common management, and significant intra-group operational and financial linkages. Furthermore, there are cross corporate guarantees extended to each other. Outlook: Stable CRISIL believes the Mulpuri group will continue to benefit over the medium term from the extensive industry experience of its promoter. The outlook may be revised to 'Positive' if there is a substantial and sustained increase in revenue and profitability margins, or continued improvement in working capital management. The outlook may be revised to 'Negative' in case of a steep decline in profitability margins, or significant deterioration in the capital structure of the group caused most likely by large, debt-funded capital expenditure or a stretched working capital cycle. The Mulpuri group was set up by Mr. Lakshmana Swamy who has more than three decades of experience in the poultry industry. The group is based in Vijayawada, Andhra Pradesh. SVPF, established in1992, and MP, established in 2003, sell hatching eggs. MFFPL, incorporated in 2009, manufactures floating fish feed and poultry feed. MFPL, was incorporated in 2009, breeds Pangasius and Indian carp fish. SUNFAME CERAMIC: CARE Assigns B+ Rating to INR5.86cr LT Loan ------------------------------------------------------------ CARE assigns 'CARE B+' and 'CARE A4' ratings to the bank facilities of Sunfame Ceramic Private Limited. Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long-term Bank Facilities 5.86 CARE B+ Assigned Short-term Bank Facilities 2.30 CARE A4 Assigned Rating Rationale The ratings assigned to the bank facilities of Sunfame Ceramic Private Limited (SCPL) are primarily constrained on account of small scale of operations coupled with low profit margins, moderately leveraged capital structure, moderate debt coverage indicators and moderate liquidity position. Furthermore, the ratings are also constrained on account of prospects linked to the highly cyclical real estate sector and susceptibility of margins to volatility associated with raw material and feed stock (LNG) prices. The ratings, however, derive benefits from the experienced promoters, located in the ceramic hub with easy access to raw material, fuel and labour. SCPL ability to increase its scale of operations and profit margins in light of volatile raw material and fuel costs would remain the key rating sensitivities. Furthermore, improvement in the capital structure and debt coverage indicators would also remain crucial. Morbi-based (Gujarat) SCPL was incorporated during March 2011 by Mr Kirti Udhreja, Mr Jayanti Patel andMr Suresh Jain and commenced commercial production of ceramic wall tiles from November 2011 onwards. SCPL operates with a capacity of manufacturing ~30,000 square meters per day (smpd) of non- vitrified wall tiles as on March 31, 2016. As per the audited result for FY15 (refers to the period April 1 to March 31), SCPL reported a TOI of INR16.80 crore with a PAT of INR0.12 crore as compared with TOI of INR14.47 crore and PAT of INR0.14 crore in FY14. As per the provisional results for FY16, SCPL has registered a TOI of INR9.00 crore. SWAGATTAM PLASTIC: Ind-Ra Suspends IND B+ Long-Term Issuer Rating ----------------------------------------------------------------- India Ratings and Research (Ind-Ra) has migrated M/s Swagattam Plastics' (Swagattam) 'IND B+' Long-Term Issuer Rating to the suspended category. The Outlook was Stable. The rating will now appear as 'IND B+(suspended)' on the agency's website. The ratings have been migrated to the suspended category due to lack of adequate information. Ind-Ra will no longer provide ratings or analytical coverage for Swagattam. The ratings will remain in the suspended category for a period of six months and be withdrawn at the end of that period. However, in the event the issuer starts furnishing information during the six-month period, the ratings could be reinstated and will be communicated through a rating action commentary. Swagattam's ratings: -- Long-Term Issuer Rating: migrated to 'IND B+(suspended)' from 'IND B+'/Stable -- INR5 million non-fund-based limits: migrated to 'IND A4(suspended)' from 'IND A4' -- INR30 million fund-based limits: migrated to IND B+(suspended)' from 'IND B+' -- INR10.53 million Long-term loans: migrated to 'IND B+(suspended)' from 'IND B+' T. S. JAYAPRAKASH: CRISIL Reaffirms 'B' Rating on INR46.5MM Loan ---------------------------------------------------------------- CRISIL has reaffirmed its ratings to the bank facilities of T. S. Jayaprakash (TSJ). Amount Facilities (INR Mln) Ratings ---------- --------- ------- Bank Guarantee 20 CRISIL A4 (Reaffirmed) Overdraft Facility 46.5 CRISIL B/Stable (Reaffirmed) Proposed Working Capital Facility 13.5 CRISIL B/Stable (Reaffirmed) The ratings continue to reflect TSJ's modest scale, and working- capital-intensive nature of operations in the intensely competitive civil construction industry. These rating weaknesses are partially offset by the extensive industry experience of the firm's proprietor. Outlook: Stable CRISIL believes that TSJ will continue to benefit over the medium term from its proprietor's extensive industry experience. The outlook may be revised to 'Positive' in case of a significant increase in the firm's scale of operations while it maintains its operating profitability, or if it improves its working capital management, resulting in a better financial risk profile. Conversely, the outlook may be revised to 'Negative' if TSJ's accruals decline, or if its working capital requirements increase substantially, leading to weakening of its financial risk profile. TSJ is a Palakkad (Kerala)-based civil contractor. Its operations are managed by its proprietor, Mr. T S Jayaprakash. TRIPATHI HOSPITAL: CRISIL Ups Rating on INR200MM Term Loan to B+ ---------------------------------------------------------------- CRISIL has upgraded its rating on the long-term bank facility of Tripathi Hospital Private Limited (THPL) to 'CRISIL B+/Stable' from 'CRISIL B/Stable'. Amount Facilities (INR Mln) Ratings ---------- --------- ------- Term Loan 200 CRISIL B+/Stable (Upgraded from 'CRISIL B/Stable') The upgrade reflects the expected improvement in the company's business and financial risk profiles on account of full-fledged commencement of its hospital by October 2016. The company's turnover rose to INR38 million in fiscal 2016 from INR16 million in fiscal 2015 on account of partial commencement of hospital, and is expected at INR150-200 million in fiscal 2017. Its operating margin improved significantly to 55% in fiscal 2016 from 10.7 per cent in 2014-15 on account of increased occupancy with no major increase in cost, and is expected to remain healthy. The company's financial risk profile is expected to improve because with expected improvement in accretion to reserves. Its total outside liabilities to tangible networth ratio improved to 2.9 times as on March 31, 2016, from 5.87 times as on March 31, 2015 on account of equity infusion of INR30 million in fiscal 2016. The rating reflects THPL's small scale of operations, and its exposure to risks related to stabilisation of operations of its multi-speciality hospital. These weaknesses are partially offset by the extensive experience of its promoters in the healthcare industry. Outlook: Stable CRISIL believes THPL will continue to benefit over the medium term from its promoters' extensive industry experience. The outlook may be revised to 'Positive' if the company significantly scales up operations, while improving its operating profitability, resulting in substantial cash accrual and a better financial risk profile. The outlook may be revised to 'Negative' if its scale of operations remains stagnant, or if it undertakes substantial debt-funded capital expenditure, weakening its financial risk profile, particularly liquidity. THPL, incorporated in November 2001, provides medical services in the fields of orthopaedics and gynaecology/obstetrics. It was originally established as a partnership firm in 2000 and was reconstituted as a private limited company in 2001. The company is managed by Mr B K Tripathi and his wife Ms. Nidhi Tripathi. It has a 100-bed hospital at Noida in Uttar Pradesh. VED CELLULOSE: Ind-Ra Suspends 'IND BB' Long-Term Issuer Rating ---------------------------------------------------------------- India Ratings and Research (Ind-Ra) has migrated Ved Cellulose Limited's (VCL) 'IND BB' Long-Term Issuer Rating to the suspended category. The Outlook was Stable. The rating will now appear as 'IND BB(suspended)' on the agency's website. A full list of rating actions is given at the end of the commentary. The ratings have been migrated to the suspended category due to lack of adequate information. Ind-Ra will no longer provide ratings or analytical coverage for VCL. The ratings will remain in the suspended category for a period of six months and be withdrawn at the end of that period. However, in the event the issuer starts furnishing information during the six-month period, the ratings could be reinstated and will be communicated through a rating action commentary. VCL's Ratings: -- Long-Term Issuer Rating: migrated to 'IND BB(suspended)' from 'IND BB'/Stable -- INR147.5 million fund-based limits: migrated to 'IND BB(suspended)' from 'IND BB' -- INR34.85 million term loan: migrated to 'IND BB(suspended)' from 'IND BB' -- INR60 million non-fund-based limits: migrated to 'IND A4+(suspended)' from 'IND A4+' WILSON PRINTCITY: CRISIL Reaffirms 'B' Rating on INR47.5MM Loan --------------------------------------------------------------- CRISIL has reaffirmed its ratings on the long term bank facilities of Wilson Printcity Private Limited (WPPL) at 'CRISIL B/Stable' while assigning its ratings on the short-term facilities at 'CRISIL A4'. Amount Facilities (INR Mln) Ratings ---------- --------- ------- Bank Guarantee 5 CRISIL A4 (Reassigned) Cash Credit 35 CRISIL B/Stable (Reaffirmed) Term Loan 47.5 CRISIL B/Stable (Reaffirmed) Proposed Long Term Bank Loan Facility 27.5 CRISIL B/Stable (Reaffirmed) The ratings on the bank facilities of Wilson Printcity Pvt Ltd (WPPL) continues to reflect the company's large working capital requirement and small scale of operations in the fragmented printing industry. These weaknesses are partially offset by the industry experience of its promoters, and its comfortable financial risk profile. Outlook: Stable CRISIL believes WPPL will continue to benefit over the medium term from the industry experience of its promoters and its healthy debt protection metrics. The outlook may be revised to 'Positive' if the company reports strong accrual backed by significant increase in revenue or operating margin, and improves its working capital management. The outlook may be revised to 'Negative' in case of decline in its accrual, or large debt- funded capital expenditure, or increase in working capital requirement, weakening its financial risk profile. Update WPPL had modest revenue of INR152.0 million in fiscal 2016. The revenue has been stagnant on account of discontinuation of relationship with Navneet Education Limited and no order from the Gujarat government for printing of text books. However, the company won other orders. Its operating margin declined to 9.0% in fiscal 2016 from 23.1% in fiscal 2015 on account of intense competition. Its working capital requirement remains large because of receivables of over 100 days in the three years ended March 31, 2016, and inventory of 65 days. However, the working capital management is supported by payables. The company's financial risk profile remains comfortable for the current scale of operations, supported by networth of INR118.0 million and gearing of less than 1.0 time as on March 31, 2016. Its debt protection metrics were also healthy, with interest coverage and net cash accrual to total debt ratios of 2.1 times and 0.21 time, respectively, for fiscal 2016. The liquidity is modest because of low accrual of INR17-20 million in fiscal 2016 and high bank line utilisation of over 98.0% in the 12 months through May 2016. The liquidity is supported by unsecured loans of INR111 million from the promoters. WPPL, incorporated in 1995, is promoted by the Ahmedabad, Gujarat-based Mr. Gunvantrail Dave and his family members. The company provides printing services. Its printing press facility is at Sanand in Ahmedabad. ========= J A P A N ========= KAWASAKI KISEN: Egan-Jones Assigns B Sr. Unsecured Debt Ratings --------------------------------------------------------------- Egan-Jones Ratings Company assigned B ratings on senior unsecured debt issued by Kawasaki Kisen Kaisha Ltd. on July 5, 2016. Kawasaki Kisen Kaisha, Ltd., also referred to as "K" Line, is one of the largest Japanese transportation companies. MARUI GROUP: Egan-Jones Assigns BB+ Sr. Unsecured Debt Ratings -------------------------------------------------------------- Egan-Jones Ratings Company assigned BB+ ratings on senior unsecured debt issued by Marui Group Co Ltd on July 7, 2016. Marui Group operates through about 25 subsidiaries and 6 affiliates in retailing and credit card services. MITSUI ENGINEERING: Egan-Jones Assigns BB Sr. Unsec. Debt Ratings ----------------------------------------------------------------- Egan-Jones Ratings Company assigned BB ratings on senior unsecured debt issued by Mitsui Engineering & Shipbuilding Co. Ltd on July 1, 2016. Mitsui Engineering & Shipbuilding is a Japanese company. MITSUI OSK: Egan-Jones Assigns B Sr. Unsec. Debt Ratings -------------------------------------------------------- Egan-Jones Ratings Company assigned B ratings on senior unsecured debt issued by Mitsui OSK Lines Ltd on July 7, 2016. Mitsui OSK Lines (MOL) is a Japanese transport company headquartered in Toranomon, Minato, Tokyo, Japan. SHOWA SHELL: Egan-Jones Assigns B Sr. Unsecured Debt Ratings ----------------------------------------------------------- Egan-Jones Ratings Company assigned B ratings on senior unsecured debt issued by Showa Shell Sekiyu KK on July 6, 2016. Showa Shell Sekiyu Kabushiki Kaisha is the base of Royal Dutch Shell group in Japan. The Company provides oil and energy solution business in Japan and worldwide. It was formed by the merger of Showa Oil Company and Shell Sekiyu. SOFTBANK GROUP: Egan-Jones Assigns BB FC Sr. Unsec. Debt Rating ---------------------------------------------------------------- Egan-Jones Ratings Company assigned a BB foreign currency senior unsecured rating on debt issued by SoftBank Group Corp on June 30, 2016. SoftBank Group Corp. is a Japanese multinational telecommunications and Internet corporation. TOKYO DOME: Egan-Jones Assigns BB- Sr. Unsecured Debt Rating ------------------------------------------------------------ Egan-Jones Ratings Company assigned BB- ratings on senior unsecured debt issued by Tokyo Dome Corp on July 11, 2016. EJR also assigned B ratings on commercial paper issued by the Company. Tokyo Dome Corporation operates an air dome-type baseball stadium and an urban amusement center. The Company also sells sundry goods and operates financing, hotels, real estate, restaurants, and convention and exhibition halls. UNITIKA LTD: Egan-Jones Assigns B Sr. Unsecured Debt Rating ----------------------------------------------------------- Egan-Jones Ratings Company assigned B ratings to senior unsecured debt issued by Unitika Ltd on July 8, 2016. Unitika Ltd is a Japanese company based in Osaka, Japan. Primarily, the company produces various textiles, glass, plastics, and carbon fiber products. =============== M A L A Y S I A =============== 1MALAYSIA: Singapore Vows More 'Intrusive' Bank Probes ------------------------------------------------------ Jeevan Vasagar at The Financial Times reports that Singapore's regulator has vowed more "intrusive" inspections of banks over money-laundering after admitting that the scandal surrounding Malaysia's state investment fund has been a blow to the city- state's reputation as a financial centre. FT says banks in Singapore were used to channel money diverted from 1MDB, according to US prosecutors, who allege that more than $3.5 billion was siphoned off from the Malaysian state investment fund. "There is no doubt that the recent findings have made a dent in our reputation as a clean and trusted financial centre," FT quotes Ravi Menon, managing director of the Monetary Authority of Singapore, as saying. He described the lapses in anti money-laundering controls as "unacceptable" and warned of tougher inspections, the report relates. "We will spend more time," Mr Menon said at the launch of the MAS annual report. "We will ask more questions. We will look through minutes. There will be surprise visits." FT relates that Mr Menon said the tougher regime would not apply across the board but would focus on banks that had underperformed in previous inspections. "We will work hard with the industry to ensure that Singapore offers neither safe haven nor safe passage for tainted money from anywhere," he added. From next month, the MAS will have a dedicated money-laundering unit, and a supervisory team to monitor risks and carry out on- site inspections, according to FT. These functions have previously been spread between departments. The regulator is also creating a new enforcement unit to investigate suspected violations. Earlier this year, the MAS ordered the closure of Swiss bank BSI's Singapore operation after inspections that revealed lapses in policy, failures of oversight and multiple breaches of anti money-laundering regulations, FT says. BSI accounts in Switzerland and Singapore have been used for 1MDB-related fund transfers, FT relays citing US prosecutors. Last week, Singapore authorities announced the seizure of bank accounts and other assets totalling SGD240 million (USD177 million) in connection with investigations into 1MDB fund flows, FT recalls. This total includes SGD120 million belonging to Malaysian businessman Jho Low and his family. FT notes that Mr Low is alleged by US prosecutors to have played a central role in the operations of 1MDB, although he has denied playing any part after the fund was created. About 1MDB Kuala Lumpur-based 1Malaysia Development Bhd (1MDB) operates as a government agency. The Company offers financial assistance, analysis, and advice through investors, corporations, and consultants to startups and growth companies. 1MDB focuses on investments with strategic value and high multiplier effects on the economy, particularly in energy, real estate, tourism, and agribusiness. As reported in the Troubled Company Reporter-Asia Pacific on July 23, 2015, Reuters said Singapore Police Force has frozen two bank accounts to help with an investigation in to Malaysia's troubled state-owned investment fund 1Malaysia Development Bhd (1MDB), which is being probed by authorities in Malaysia for financial mismanagement and graft. Reuters said the freezing of the Singapore bank accounts follows a similar move in Malaysia where a task force investigating 1MDB said earlier in July that it had frozen half a dozen bank accounts following a media report that nearly $700 million had been transferred to an account of Malaysia's Prime Minister Najib Razak. The Wall Street Journal reported on July 3, 2015, that investigators looking into 1MDB had traced close to US$700 million of deposits moving through Falcon Bank in Singapore into personal bank accounts in Malaysia belonging to Najib. The TCR-AP, citing Bloomberg News, reported on Nov. 26, 2015, that 1MDB agreed to sell its power assets to China General Nuclear Power Corp. for MYR9.83 billion ($2.3 billion) as the state investment company moved one step closer to winding down operations after its mounting debt raised investor concern. Bloomberg related that the company faced cash-flow problems after a planned initial public offering of Edra faced delays amid unfavorable market conditions, President Arul Kanda said Oct. 31, 2015. The listing plan was later canceled as the company opted for a sale of the assets, Bloomberg noted. The TCR-AP, citing The Wall Street Journal, reported on April 27, 2016, that the company defaulted on a $1.75 billion bond issue, triggering cross defaults on two other Islamic notes totaling MYR7.4 billion ($1.9 billion). Asian Nikkei Review reported last month that Malaysia has replaced the board of 1Malaysia Development Berhad with treasury officials, paving the way for the dissolution of the troubled state investment fund. 1MALAYSIA: Goldman Sachs Under Spotlight in 1MDB Scandal -------------------------------------------------------- Reuters reports that Goldman Sachs' work with Malaysian sovereign wealth fund 1MDB is under the spotlight over U.S. government allegations that billions of dollars were diverted for the personal use of officials and some people associated with them. Reuters relates that the Wall Street bank helped 1MDB, which was founded by Malaysian Prime Minister Najib Razak in September 2009, raise $6.5 billion in three bond sales in 2012 and 2013 to invest in energy projects and real estate to boost the Malaysian economy. Instead, more than $2.5 billion raised from those bonds was misappropriated by high-level 1MDB officials, their relatives and associates, Reuter says citing U.S. Department of Justice civil lawsuits filed in court on July 20. According to Reuters, prosecutors said the money was used to buy artwork, including paintings by Vincent Van Gogh and Claude Monet, luxury properties in New York and London and to pay off gambling debts in Las Vegas. Reuters says Goldman Sachs, which earned close to $600 million to arrange and underwrite the 1MDB bonds, has not been accused of any wrongdoing. Still, the lawsuits allege investors were not properly informed about the use and nature of the bonds. The U.S. Justice Department said that the offering circulars for two of the bonds issued in 2012 contained "material misrepresentations and omissions" over what the proceeds of the bonds would be used for and the nature of the relationship between 1MDB and International Petroleum Investment Company (IPIC), an entity owned by the Abu Dhabi government, according to Reuters. IPIC guaranteed one bond directly and another one indirectly. The U.S. government also alleged in its lawsuit that no reference to IPIC's indirect guarantee was included on one of the offering circular, Reuters says. "We helped raise money for a sovereign wealth fund that was designed to invest in Malaysia. We had no visibility into whether some of those funds may have been subsequently diverted to other purposes," Reuters quotes a spokesman for the bank as saying. The FBI and other U.S. regulators, including New York's Department of Financial Services, have been investigating Goldman Sachs' business relationship with 1MDB, Reuters states. About 1MDB Kuala Lumpur-based 1Malaysia Development Bhd (1MDB) operates as a government agency. The Company offers financial assistance, analysis, and advice through investors, corporations, and consultants to startups and growth companies. 1MDB focuses on investments with strategic value and high multiplier effects on the economy, particularly in energy, real estate, tourism, and agribusiness. As reported in the Troubled Company Reporter-Asia Pacific on July 23, 2015, Reuters said Singapore Police Force has frozen two bank accounts to help with an investigation in to Malaysia's troubled state-owned investment fund 1Malaysia Development Bhd (1MDB), which is being probed by authorities in Malaysia for financial mismanagement and graft. Reuters said the freezing of the Singapore bank accounts follows a similar move in Malaysia where a task force investigating 1MDB said earlier in July that it had frozen half a dozen bank accounts following a media report that nearly $700 million had been transferred to an account of Malaysia's Prime Minister Najib Razak. The Wall Street Journal reported on July 3, 2015, that investigators looking into 1MDB had traced close to US$700 million of deposits moving through Falcon Bank in Singapore into personal bank accounts in Malaysia belonging to Najib. The TCR-AP, citing Bloomberg News, reported on Nov. 26, 2015, that 1MDB agreed to sell its power assets to China General Nuclear Power Corp. for MYR9.83 billion ($2.3 billion) as the state investment company moved one step closer to winding down operations after its mounting debt raised investor concern. Bloomberg related that the company faced cash-flow problems after a planned initial public offering of Edra faced delays amid unfavorable market conditions, President Arul Kanda said Oct. 31, 2015. The listing plan was later canceled as the company opted for a sale of the assets, Bloomberg noted. The TCR-AP, citing The Wall Street Journal, reported on April 27, 2016, that the company defaulted on a $1.75 billion bond issue, triggering cross defaults on two other Islamic notes totaling MYR7.4 billion ($1.9 billion). Asian Nikkei Review reported last month that Malaysia has replaced the board of 1Malaysia Development Berhad with treasury officials, paving the way for the dissolution of the troubled state investment fund. ==================== N E W Z E A L A N D ==================== BELLA'S CAFE: Closes After Two Decades in Business -------------------------------------------------- Paul Mitchell at Stuff.co.nz reports that Palmerston North's Bella's Cafe has closed after two decades in business. According to Stuff.co.nz, owner and chef Karl Austen said Bella's style of fine dining had gone out of fashion as people watched their wallets and business had been declining. It had been open 20 years, to the day, when it closed on July 1, he said. "Bella's had its regulars which kept things going for 20 years but there wasn't enough new blood coming in. It's a shame, but nothing lasts forever and they do say this is the year for change." When Mr. Austen and former business partner Alistair Pearson took over the eatery in 1998 it was a lunch time cafe, and part of the name stuck. The report relates that Mr. Austen said while he was selling up in Palmerston North, he was looking to open a new restaurant in Whanganui. "I already have clientele there and the town's screaming out for somewhere like Bella's. There's little in that style of fine dining over there." He also wanted to take the opportunity to try some new ideas that didn't quite fit with Bella's style. "I want to be learning something new everyday. I love what I do, but repetition hinders you a bit." Stuff.co.nz says the first half of 2016 has already seen several well-known names in Palmerston North hospitality leave the scene, including Hester Guy's retirement and the closure of long running restaurants Ken's Kitchen and Halikarnas. Restaurant Association of New Zealand Manawatu president Sean Kereama couldn't believe Bella's had closed, but it was possibly a sign of the times, he said, Stuff.co.nz relays. "It was a lovely restaurant in a good position [on The Square]. It's been one of Palmerston North's best restaurants for a number of years. But dining out is one of the first things out the door when people are tightening their belts," Stuff.co.nz quotes Mr. Kereama as saying. A fixture of the city's dinning scene, Bella's had a reputation for top-notch casual fine dining. The business won Restaurant of the Year at the Manawatu Hospitality Awards three times, starting with at the inaugural awards in 2007, Stuff.co.nz discloses. =========== T A I W A N =========== ACER INC: Egan-Jones Hikes Sr. Unsecured Debt Ratings to B- ----------------------------------------------------------- Egan-Jones Ratings Company raised the senior unsecured ratings on debt issued by Acer Inc. to B- from CCC+ on July 1, 2016. EJR also raised the commercial paper rating on the Company to B from C. Acer Inc. is a Taiwanese multinational hardware and electronics corporation specialising in advanced electronics technology and is headquartered in Xizhi, New Taipei City, Taiwan. JIH SUN: Fitch Affirms 'BB+' LT FC Issuer Default Ratings --------------------------------------------------------- Fitch Ratings has affirmed the ratings of Jih Sun Financial Holding Co., Ltd (JSH) and its subsidiary Jih Sun International Bank (JSIB). At the same time, Fitch has downgraded the ratings of Jih Sun Securities Corp., Ltd (JSS) and removed them from Rating Watch Negative (RWN). The Outlooks for all three entities are Stable. Fitch placed JSS's ratings on RWN on 18 May 2016 because the agency was re-assessing the group's credit profile. A full list of rating actions is at the end of this rating action commentary. KEY RATING DRIVERS IDRS AND NATIONAL RATINGS Fitch has affirmed the ratings on JSH and JSIB and downgraded JSS's ratings because the agency has shifted its approach to analyse the group's consolidated profile and assigned common ratings to all group entities. Previously, Fitch rated the group using JSS's ratings as the anchor for the group's ratings and notched each entity's rating from the anchor rating based on its credit profile. However, JSIB's significant size and contribution to the group leads to some limitations in that approach. JSIB accounts for about 85% of JSH's assets and JSS makes up around 15% of the holding company's assets. Fitch's revised assessment of the group takes into account the high integration of the management within the group, the consolidated regulatory supervision, and fungibility of liquidity and capital within the group. Thus, all three entities have high correlation of default, and Fitch treats them as having one credit profile. The affirmation of JSH and JSIB, and downgrade of JSS reflect the growing asset and earnings contribution from JSIB to the group. JSH's credit profile is weighed down by its overall modest franchise and limited pricing power. The group's franchise is smaller relative to most financial holding companies in Taiwan, with the group's brokerage franchise shrinking. The group's ratings are supported by its balance sheet strength and conservative risk appetite. JSH takes on less growth risk relative to peers. Its balance sheet expanded at CAGR of only 1.5% between 2011 and 2015. Its impaired ratio declined substantially to 1.82% at end-2015 from 4.66% at end-2013. JSH's capitalisation is strong, with its Fitch Core Capital Ratio higher than those of peers in Taiwan. However, its ROA excluding bad debt recoveries is lower than that of peers. VIABILITY RATINGS Fitch has assigned JSH a Viability Rating (VR) of 'bb+' to reflect the credit profile on a consolidated basis. Fitch has also upgraded JSIB's VR to 'bb+' from 'bb', and removed its Rating Watch Positive (RWP) to align it with other ratings of the group. SUPPORT RATING AND SUPPORT RATING FLOOR Fitch has simultaneously assigned a Support Rating of '5' and a Support Rating Floor of 'NF' (No Floor) to JSIB to reflect the low likelihood of sovereign support to the entity due to its small deposit franchise and modest systemic importance. SUBORDINATED DEBT JSIB's non-Basel-III-compliant subordinated bond is rated one notch below the issuer's National Long-Term Rating to reflect its subordinated status and the absence of going-concern loss- absorption features. JSIB's Taiwanese Basel III Tier 2 (B3T2) capital is rated two notches below the issuer's anchor rating, comprising zero notching for non-performance risk and two notches for loss severity. Wider notching than Fitch's base case of one notch reflects the poor recovery prospects for Taiwanese B3T2 debt at the point of non-viability or government receivership. Taiwan's authorities would only move a bank into insolvency administration when it reaches a very low capital level or a 2% capital adequacy ratio, reducing the recovery prospects for B3T2 debt. The above notching practices are in accordance with Fitch's criteria on rating bank regulatory capital and similar securities. RATING SENSITIVITIES IDRS, VIATBILITY RATINGS AND NATIONAL RATINGS The group's IDRs, VRs, and National Ratings could be upgraded if the group can strengthen its franchise and sustainably improve its core profitability without significantly expanding its risk appetite. A downgrade to the group's IDRs, VRs, and National Ratings could result from unexpected large proprietary trading losses by its securities business or significantly weakened loan book quality leading to impairment of capital. SUPPORT RATING AND SUPPORT RATING FLOOR The Support Rating and Support Rating Floor are sensitive to any change in assumptions around the propensity or ability of the Taiwan government to provide timely support to the bank. SUBORDINATED DEBT Any rating action on JSIB's National Long-Term Rating could trigger a similar move on its debt ratings The full list of rating actions is as follows: JSH Long-Term Foreign Currency IDR affirmed at 'BB+'; Outlook Stable Short-Term Foreign Currency IDR affirmed at 'B' National Long-Term Rating affirmed at 'A-(twn)'; Outlook Stable National Short-Term Rating affirmed at 'F2(twn)' Viability Rating assigned at 'bb+' JSIB Long-Term Foreign Currency IDR affirmed at 'BB+'; Outlook Stable Short-Term Foreign Currency IDR affirmed at 'B'; National Long-Term Rating affirmed at 'A-(twn)'; Outlook Stable National Short-Term Rating affirmed at 'F2(twn)'; Viability Rating upgraded to 'bb+' from 'bb'; removed from Rating Watch Positive Subordinated debt (non-Basel III-compliant) rating affirmed at 'BBB+(twn)' Subordinated debt (Basel III Tier 2 capital) rating affirmed at 'BBB(twn)' Support Rating assigned at '5' Support Rating Floor assigned at 'NF' JSS Long-Term Foreign Currency IDR downgraded to 'BB+' from 'BBB-'; removed from Rating Watch Negative; assigned Stable Outlook Short-Term Foreign Currency IDR downgraded to 'B' from 'F3'; removed from Rating Watch Negative National Long-Term Rating downgraded to 'A-(twn)' from 'A(twn)'; removed from Rating Watch Negative; assigned Stable Outlook National Short-Term Rating downgraded to 'F2(twn)' from 'F1(twn)'; removed from Rating Watch Negative YUANTA COMMERCIAL: Fitch Assigns 'BB+' Support Rating Floor ----------------------------------------------------------- Fitch Ratings has affirmed the 'BBB+' Long-Term Foreign-Currency Issuer Default Rating (IDR) ratings of Taiwan-based Yuanta Financial Holding Co., Ltd. (YFHC) and its subsidiaries, Yuanta Securities Co., Ltd. (YS) and Yuanta Commercial Bank Co., Ltd. (YCB). The Outlook is Stable. At the same time, Fitch removed the Rating Watch Negative (RWN) on the three entities. A full list of rating actions is at the end of this commentary. Fitch placed the group's ratings on RWN on 19 August 2015 following YFHC's announcement to acquire all the shares of Ta Chong Commercial Bank (TCB), as the acquisition would potentially dilute the group's financial strength and involve execution risk. YFHC completed its acquisition of TCB in 22 March, 2016 and plans to consolidate TCB and YCB into one Yuanta-branded bank by first half of 2017. KEY RATING DRIVERS IDRS, NATIONAL RATINGS AND SENIOR DEBT The removal of ratings from RWN and the consequent affirmation of the rating on the group reflects its enlarged franchise and sound financial standing, which is commensurate with the group's IDRs. Fitch deems the group companies as highly correlated and sharing the same credit profile, hence all three companies are rated at the same level. Fitch assessed the group using the common ratings approach, finding that the group had a diversified business model, with the securities and banking business representing 42% each of YFHC's total equity investment at end-1Q16, management's high integration within the group, consolidated regulatory supervision and liquidity and capital fungibility within the group. The group's ratings reflect its improving domestic and regional franchise, sound internal capital generation and the subsidiaries' adequate capital position. The banking business had a pro-forma 9.4% common equity Tier 1 ratio at end-2015 and the securities business had a capital adequacy ratio of more than 350%. Fitch expects steady profitability and restrained asset growth to underpin the group's capital, with modest capital usage among its principal subsidiaries. Group asset quality is in line with similarly rated domestic peers, with an impaired loan ratio of 1.6% and coverage ratio of more than 100% at end-1Q16. Excluding the legacy portfolio from Yuanta Securities Korea Co., Ltd, the pro-forma impaired loans ratio at banking business would fall to 1.1%, with a coverage ratio of 136%. The group has a conservative market-risk appetite and consistently manages its value-at-risk below 0.5% of YFHC's equity, its self-imposed threshold. YCB's senior unsecured bonds are rated at the same level as its National Long-Term Rating of 'AA-(twn)', reflecting the bonds' relative probability of default within Taiwan's national scale. VIABILITY RATING Fitch has assigned YFHC a Viability Rating of 'bbb+' to reflect its credit profile on a consolidated basis and has upgraded YCB's Viability Rating to 'bbb+' from 'bb+' to align it with the group's rating. SUPPORT RATING AND SUPPORT RATING FLOOR Fitch has assigned YCB a Support Rating of '3' and a Support Rating Floor 'BB+' to reflect its moderate systemic importance and moderate probability of state support, if needed, based on its aggregate 3% deposit market share. RATING SENSITIVITIES IDRS, VIABILITY RATING, NATIONAL RATINGS AND SENIOR DEBT Negative ratings action could result from a weakened risk profile, which could arise from overly aggressive acquisitions that significantly dilute funding and capitalisation or from excessive risk-taking for yield that compromises underwriting standards and risk controls. A rating upgrade is less likely, as the group is still developing its regional franchise and business diversity and has only moderate pricing power in its main operating segments; a higher- rated international peer would have a more established business model and strategic objectives, alongside refined management quality. Any rating action on YCB could trigger a similar move on the rating of its debt. SUPPORT RATING AND SUPPORT RATING FLOOR YCB's Support Rating and Support Rating Floor are sensitive to any change in Fitch's assumptions around the propensity or ability of the Taiwan government (A+/Positive) to provide it with timely support to the bank. Its Support Rating and Support Rating Floor may also be negatively affected if there is a significant and sustained decline in YCB's deposit market share. The rating actions are as follows: Yuanta Financial Holding Co., Ltd.: Long-Term Foreign-Currency IDR affirmed at 'BBB+'; removed from RWN, Outlook Stable Short-Term Foreign-Currency IDR affirmed at 'F2'; removed from RWN National Long-Term Rating affirmed at 'AA-(twn)'; removed from RWN, Outlook Stable National Short-Term Rating affirmed at 'F1+(twn)'; removed from RWN Viability Rating assigned at 'bbb+' Yuanta Securities Co., Ltd.: Long-Term Foreign-Currency IDR affirmed at 'BBB+'; removed from RWN, Outlook Stable Short-Term Foreign-Currency IDR affirmed at 'F2'; removed from RWN National Long-Term Rating affirmed at 'AA-(twn)'; removed from RWN, Outlook Stable National Short-Term Rating affirmed at 'F1+(twn)'; removed from RWN Yuanta Commercial Bank Co., Ltd.: Long-Term Foreign-Currency IDR affirmed at 'BBB+'; removed from RWN, Outlook Stable Short-Term Foreign-Currency IDR affirmed at 'F2'; removed from RWN National Long-Term Rating affirmed at 'AA-(twn)'; removed from RWN, Outlook Stable National Short-Term Rating affirmed at 'F1+(twn)'; removed from RWN Viability Rating upgraded to 'bbb+' from 'bb+' Support Rating assigned at '3' Support Rating Floor assigned at 'BB+' Senior unsecured debt affirmed at 'AA-(twn)'; removed from RWN ********* 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 ***