/raid1/www/Hosts/bankrupt/TCRAP_Public/160818.mbx
T R O U B L E D C O M P A N Y R E P O R T E R
A S I A P A C I F I C
Thursday, August 18, 2016, Vol. 19, No. 163
Headlines
A U S T R A L I A
BHP BILLITON: Posts Record Annual Loss of US$6.4 Billion
BOXING EXPRESS: First Creditors' Meeting Set For Aug. 25
CRAZY LACE: Grain Trader Face Two Court Appearance in a Week
SWISSCUT AUSTRALIA: First Creditors' Meeting Set For Aug. 25
TMD INVESTMENTS: First Creditors' Meeting Set For Aug. 24
XTU PTY: First Creditors' Meeting Slated For Aug. 24
C H I N A
MOXIAN INC: Cash Flow Problems Raise Substantial Doubt
POWERLONG REAL: Interim Results Supports B2 CFR, Moody's Says
YINGDE GASES: Fitch Says Cash Collection Risk Remains High
H O N G K O N G
HUA HAN: Fitch Puts 'BB-' FC IDR on Rating Watch Negative
NOBLE GROUP: Pushes Back After Moody's Two-Step Rating Downgrade
NOBLE GROUP: Moody's Lowers CFR & Sr. Unsec. Bond Ratings to B2
I N D I A
AMBICO EXPORTS: CRISIL Reaffirms B+ Rating on INR240MM Loan
ANMOL ASSOCIATES: CRISIL Assigns 'B' Rating to INR30MM Cash Loan
ANUBHAV PLAST: Ind-Ra Assigns 'IND B+' Long-Term Issuer Rating
ASIAN OILFIELD: CRISIL Lowers Rating on INR380MM Loan to 'D'
ASSOCIATED APPLIANCES: CRISIL Reaffirms B- Rating on INR100M Loan
BAJRANG COTEX: CRISIL Assigns B+ Rating to INR45MM Cash Loan
BAJRANG COTTON: CRISIL Assigns B+ Rating to INR90MM Cash Loan
BHAIRAVNATH POULTRY: CRISIL Reaffirms B Rating on INR96.6MM Loan
BHARGAVA EDUCATIONAL: Ind-Ra Assigns 'IND B+' Rating to Term Loan
BILCARE LIMITED: ICRA Assigns 'MC' Rating to INR125cr Loan
BRAND CONCEPTS: Ind-Ra Hikes LT Issuer Rating to 'IND BB'
CEEKAY ASSOCIATES: Ind-Ra Assigns 'IND B+' LT Issuer Rating
CHANDRAKONA COLD: Ind-Ra Hikes LT Issuer Rating to 'IND B'
CRIYAGEN AGRI: CRISIL Reaffirms 'B' Rating on INR160MM Term Loan
EXOTICA CERAMIC: ICRA Suspends B+ Rating on INR5cr Cash Loan
GALAXY ENERGY: CRISIL Assigns 'B' Rating to INR150MM Cash Loan
H.K. AGRO: ICRA Assigns 'B' Rating to INR3.38cr Term Loan
HBS REALTORS: ICRA Reaffirms 'B' Rating on INR53.56cr NCD
IMMENSE INDUSTRIES: CRISIL Cuts Rating on INR350MM Loan to 'D'
INDIAN BANK: Fitch Affirms & Withdraws 'B' Issuer Default Ratings
INTERNATIONAL AGRO: ICRA Suspends B Rating on INR17cr Term Loan
JAY UMIYA: ICRA Reaffirms 'B' Rating on INR5.50cr Cash Loan
KASTURCHAND FERTILIZERS: Ind-Ra Cuts LT Issuer Rating to 'IND B+'
LOK RAJ: CRISIL Assigns 'D' Rating to INR120MM Cash Loan
MANN RESIDENCY: CRISIL Hikes Rating on INR190MM Loan to 'C'
MEWAR UNIVERSITY: CRISIL Lowers Rating on INR296.7MM Loan to D
MULTITECH AUTO: Ind-Ra Assigns 'IND BB+' Long-term Issuer Rating
PANACHE ALUMINIUM: ICRA Suspends 'D' Rating on INR22cr Loan
PARVATIYA PLYWOOD: CRISIL Reaffirms B+ Rating on INR57.5MM Loan
PREMIER CONVEYORS: ICRA Assigns 'B' Rating to INR2.75cr LT Loan
R.A. MOTORS: CRISIL Reaffirms B+ Rating on INR100MM Loan
ROOP RAM: CRISIL Raises Rating on INR140MM LT Loan to 'C'
SALIA POLYMERS: CRISIL Assigns B- Rating to INR45MM Cash Loan
SANGAR OVERSEAS: Ind-Ra Hikes Long-Term Issuer Rating to 'IND B'
SAYONA COLORS: CRISIL Lowers Rating on INR450MM Cash Loan to D
SHIVA TRADING: CRISIL Assigns B+ Rating to INR35MM Cash Loan
SHREE RAM: CRISIL Assigns 'B' Rating to INR60MM Cash Loan
SHRI BIJASANI: CRISIL Reaffirms 'B' Rating on INR70MM Cash Loan
SOLWEDISH SOLAR: Weak Financial Strength Cues ICRA SP 3D Grading
SRI BALASUBRAMANIA: CRISIL Reaffirms B- Rating on INR59.4MM Loan
SRI LAKSHMI: CRISIL Lowers Rating on INR170MM LT Loan to 'B'
SRINIVASA CIVIL: Ind-Ra Suspends 'IND D' LT Issuer Rating
SUDAMA COTTON: CRISIL Reaffirms 'B' Rating on INR50MM Cash Loan
SWAROOP AGRO: CRISIL Assigns B+ Rating to INR60MM Term Loan
SWASH NONIONICS: CRISIL Reaffirms 'B' Rating on INR90MM LT Loan
SYRMA TECHNOLOGY: Ind-Ra Cuts LT Issuer Rating to 'IND BB+'
TATA CHEMICALS: Fitch Says Business Sale to Boost Credit Profile
TATA MOTORS: S&P Raises CCR to 'BB+', Outlook Stable
UNISEX AGENCIES: CRISIL Reaffirms B+ Rating on INR90MM Cash Loan
UTKAL HEALTHCARE: CRISIL Assigns 'B' Rating to INR450MM Term Loan
VEESONS ENERGY: CRISIL Reaffirms 'D' Rating on INR360MM Loan
VIKRANT ISPAT: Ind-Ra Assigns 'IND BB-' Long-Term Issuer Rating
I N D O N E S I A
MASKAPAI REASURANSI: Fitch Affirms 'BB' International IFS Rating
N E W Z E A L A N D
TAHA ASIA: Gore District Council Listed as Unsecured Creditor
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A U S T R A L I A
=================
BHP BILLITON: Posts Record Annual Loss of US$6.4 Billion
--------------------------------------------------------
The Irish Times reports that BHP Billiton reported a record
US$6.4 billion annual loss on August 16, hammered by a bad bet on
shale, a dam disaster in Brazil and a commodities slump, but said
it expects its free cash flow to more than double this year.
"While commodity prices are expected to remain low and volatile
in the short to medium term, we are confident in the long-term
outlook for our commodities, particularly oil and copper," the
report quotes chief executive Andrew Mackenzie as saying in a
statement.
Even excluding US$7.7 billion in writedowns and charges,
underlying profit slumped 81% to US$1.2 billion for the year to
June 2016 from US$6.4 billion a year ago, hit by weak iron ore,
copper, coal, oil and gas prices, the report discloses.
The Irish Times says the underlying profit was the weakest since
the merger of BHP and Billiton in 2001, but better than analysts'
expectations of about US$1.1 billion.
Australia-based BHP Billiton Limited (NYSE:BHP) --
http://www.bhpbilliton.com/-- is a global resources
company. The Company is engaged in exploration, development,
production, processing and marketing of minerals, such as iron
ore, metallurgical and energy coal, copper, aluminum, manganese,
uranium, nickel, silver and potash. It is also engaged in
exploration, development, production and marketing of
conventional and unconventional oil and gas. The Company operates
through segments: Petroleum and Potash, Copper, Iron Ore and
Coal. The Company's Petroleum and Potash segment is engaged in
exploration, development and production of oil and gas and potash
pre-development. The Copper segment is engaged in mining of
copper, silver, lead, zinc, molybdenum, uranium and gold. The
Iron Ore segment is engaged in mining of iron ore. The Coal
segment is engaged in mining of metallurgical coal and thermal
(energy) coal.
BOXING EXPRESS: First Creditors' Meeting Set For Aug. 25
--------------------------------------------------------
Nick Combis and Ashley Leslie of Vincents Chartered Accountants
were appointed as administrators of Boxing Express Pty Ltd on
Aug. 15, 2016.
A first meeting of the creditors of the Company will be held at
Vincents Chartered Accountants, Level 34, 32 Turbot Street, in
Brisbane, on Aug. 25, 2016, at 10:30 a.m.
CRAZY LACE: Grain Trader Face Two Court Appearance in a Week
------------------------------------------------------------
Peter Hemphill at The Weekly Times reports that Murray Bridge
grain trader Brenton Strauss potentially faces two court
appearances within a week.
Administrator Tony Matthews of Anthony Matthews and Associates,
took court action in February to wind up Strauss company Crazy
Lace (SA) Pty Ltd, owner of the Nhill Bulk Handling site in the
West Wimmera, the report says.
It was to be heard in the Adelaide Supreme Court on August 15,
the report states.
According to the report, Mr. Strauss put Crazy Lace (SA) up as
guarantor for two 10-cent-in-the-dollar payments to creditors of
another company, Sapphire (SA) Pty Ltd under a deed of company
arrangement entered into in May 2014. But he failed to make the
payments to creditors, the report relates.
On August 22, Mr. Strauss goes before the Murray Bridge
Magistrates Court for another mention under action taken by the
Australian Securities and Investments Commission over breach of
directors duties, says The Weekly Times.
He faces up to five years in jail on each of two counts under
Section 184 of the Corporations Act if found guilty of the
criminal charges, the report adds.
SWISSCUT AUSTRALIA: First Creditors' Meeting Set For Aug. 25
------------------------------------------------------------
Andrew Hugh and Jenner Wily of Armstrong Wily were appointed as
administrators of Swisscut Australia Pty Ltd on Aug. 15, 2016.
A first meeting of the creditors of the Company will be held at
Level 5, 75 Castlereagh Street, in Sydney, on Aug. 25, 2016, at
11:00 a.m.
TMD INVESTMENTS: First Creditors' Meeting Set For Aug. 24
---------------------------------------------------------
Philip Campbell-Wilson and Adam Nikitins of Ernst & Young were
appointed as administrators of TMD Investments Pty Ltd on Aug.
12, 2016.
A first meeting of the creditors of the Company will be held at
EY Centre, Level 33, 200 George Street, in Sydney, on Aug. 24,
2016, at 10:30 a.m.
XTU PTY: First Creditors' Meeting Slated For Aug. 24
----------------------------------------------------
Michael Oscar Basedow and Leigh Deveron Prior of Pitcher Partners
were appointed as administrators of XTU Pty Ltd on Aug. 12, 2016.
A first meeting of the creditors of the Company will be held at
Pitcher Partners, Level 1, 100 Hutt Street, in Adelaide, on
Aug. 24, 2016, at 10:30 a.m.
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C H I N A
=========
MOXIAN INC: Cash Flow Problems Raise Substantial Doubt
------------------------------------------------------
Moxian, Inc., filed with the Securities and Exchange
Commission its Form 10-Q report for the quarterly period ended
June 30, 2016.
Moxian posted $3.85 million net loss on $5,703 of revenues for
the three months ended June 30, 2016, as compared to a net loss
of $1.92 million on $18,187 of revenues reported for the same
period a year ago.
For the nine months ended June 30, 2016, the Company listed a net
loss of $9.38 million on $18,645 of revenues, compared to a net
loss of $4.06 million on $86,353 of revenues for the same period
in the prior year.
Moxian had total assets of $8.25 million, total liabilities of
$3.80 million and stockholders' equity of $4.45 million at
June 30, 2016.
As of June 30, 2016, the Company's current liabilities exceeded
the current assets by approximately $3.1 million and its
accumulated deficits were approximately $20.6 million and the
Company has incurred losses since inception, which raise
substantial doubt about the ability to continue as a going
concern. To maintain working capital sufficient to support the
Company's operation and finance the future growth of its
business, the Company has comprehensively considered the
available sources of funds.
The Company does not currently have sufficient cash or
commitments for financing to sustain its operations for the next
twelve months.
The Company plans to increase the cash flows from an initial
public offering ("IPO") and or other private placements. If the
Company's IPO and private placements do not reach the level
anticipated in its plan, and the Company is not able to obtain
the necessary additional capital on a timely basis, on acceptable
terms, or at all, the Company may be unable to implement its
current plans for expansion, repay our debt obligations or
respond to competitive pressures, any of which would have a
material adverse effect on its business, prospects, financial
condition and results of operations.
A copy of the Company's Form 10-Q report is available at:
https://is.gd/GwT1EY
Guangdong, China-based Moxian, Inc., is in the O2O
(Online-to-Offline) business. O2O means providing an online
platform for small and medium sized enterprises (SMEs) with
physical stores to conduct business online, interact with
existing customers and obtain new customers.
POWERLONG REAL: Interim Results Supports B2 CFR, Moody's Says
-------------------------------------------------------------
Moody's Investors Service said Powerlong Real Estate Holdings
Limited's interim results are in line with expectation and
support the positive outlook on its B2 corporate family rating
and B3 senior unsecured ratings.
"Powerlong' credit metrics improved in 1H 2016 due to increased
revenue contribution from its commercial developments in Shanghai
and stable growth in its recurring income base," says Dylan Yeo,
a Moody's Analyst.
Powerlong's contracted sales increased by 6% year-on-year to
RMB7.5 billion for the six months ended June 2016. Its revenue
grew by 31.6% year-on-year to RMB6.2 billion and gross margin
rose to 37.2% from 32.3% during the same period.
Higher-margin commercial sales contributed 61.1% of total
revenue, while 26.5% of revenue arose from lower-margin
residential sales. The mix between commercial and residential
sales shifted to about 70:30 in 1H 2016 from about 40:60 in 1H
2015.
The increase in revenue outpaced the increase in total debt
during the first six months of 2016, resulting in revenue/debt
increasing to 49.3% from 45.6%.
At the same time, EBIT interest coverage grew to 2.7x from 2.4x
as a result of higher EBIT and lower average interest rates.
Rental income and management fees also increased to RMB1.2
billion for the 12 months ended June 2016 from RMB1.1 billion at
end-2015 due to higher rents paid at its existing malls and the
contribution of new malls in Shanghai and Hangzhou that were
opened in Q4 2015.
Consequentially, interest coverage from recurring income -- which
includes rental income, management fees and a proportion of other
income -- rose to about 0.77x for the 12 months to June 2016 from
0.72x in 2015.
Moody's expects Powerlong's credit metrics to slightly improve by
end-2016 due to a further increase in revenue recognition.
Moody's estimates that revenue/debt will improve to 50%-55% in
the next 12 months and EBIT interest will increase to 2.7x-2.9x.
At the same time, interest coverage from recurring income will
further rise to about 0.8x-1.0x in the next 12 months with the
full-year contribution of the new malls in 2015 and the
commencement of four malls in Q4 2016.
"Powerlong's liquidity remains adequate due to its proactive debt
management and conservative approach towards land acquisitions,"
says Yeo.
Powerlong had a cash balance of RMB7.2 billion at end-June 2016,
an increase of 7% from RMB 6.7 billion at end-2015.
At the same time, its short-term debt declined to RMB5.1 billion
from RMB6.0 billion, resulting in its cash-to-short term debt
ratio improving to 141% from 112%.
The company has maintained a conservative land acquisition
strategy amid rising land prices, resulting in a decline in its
total land bank to 8.1 million square meter (sqm) from
RMB10.1 million sqm at end-2015. It only purchased three new
land plots in 1H 2016 for about RMB1.1 billion.
Moody's estimates that the company's existing land bank is
sufficient for about 2-3 years of sales in Shanghai, and about 3-
5 years in other regions in China.
Moody's expects Powerlong will gradually increase its land
purchases again over the next 12-18 months in order to replenish
its land bank in Shanghai.
The principal methodology used in these ratings was Homebuilding
And Property Development Industry published in April 2015.
Powerlong Real Estate Holdings Limited is a Chinese developer
focused on building large-scale integrated residential and
commercial properties in China.
As of June 30, 2016, it had a development land bank of around 8.1
million square meters in gross floor area in nine provinces, and
26 commercial properties in operation.
The company listed on the Hong Kong Exchange in October 2009.
The Hoi family, the founders, hold the majority stake in the
company.
YINGDE GASES: Fitch Says Cash Collection Risk Remains High
----------------------------------------------------------
Cash collection risk of Yingde Gases Group Company Limited
(Yingde; B+/Stable) will remain high in the near-term, with
ongoing long trade receivable days and sustained high 1H16
delinquency rates, says Fitch Ratings.
Yingde's account receivable days declined to 95 days in 1H16,
from 103 days at end-2015. This was primarily due to a cut in
bills receivable days. Yingde's bill receivables accounted for
21.5% of total net account receivables in 1H16. Yingde's trade
receivable days edged down to 70 days in 1H16, from 71 days at
end-2015, and its bills receivable days decreased considerably,
from 32 days to 25 days. However, the company's 1H16 delinquency
rate remains high at 69%, compared with 67% at end-2015. A slump
in average selling prices for its merchant business and weaker
cash flow generation amid China's feeble steel and chemical
sectors adds to the company's risks.
Fitch expects Yingde's FFO-adjusted net leverage to increase in
2016 from 4.1x in 2015 and remain high due to rising debt and the
ongoing average selling price slump for its merchant business.
This will be partially mitigated by sustained high operating
EBITDA margins exceeding 30% (1H16: 36.7%, 1H15: 33.6%),
supported by its large onsite businesses, which contributed 84%
of total revenue in 1H16, and selling and administration expense
cuts in 1H16. Yingde's revenue beat our expectations, rising 9%
yoy to CNY4.1 billion in 1H16 due to 12% yoy sales volume growth.
Net leverage rises will also be partially offset by capex cuts to
CNY1 billion in 2016, down 11% from the previous year, which we
expect to remain around that level in 2017. Fitch expects 1H16
net-debt/operating EBITDA of around 2.9x, from 3.4x at end-2015.
These expectations are based on Fitch's assumption of Yingde
maintaining its working capital position.
Fitch said, "We do not expect tight liquidity conditions, as
Yingde has a sufficient cash balance of CNY1.7 billion and unused
banking facilities of CNY2 billion, against CNY3.0 billion of
short-term debt. The company should not experience refinancing
risks, as it has demonstrated reliable access to equity funding
and domestic bond markets."
Yingde is also involved in a cash collection law suit against its
China-based coal chemical company client, Heilongjiang Heihua
Group, a state-owned entity with total claims of around CNY10m.
However, another suit has settled as Yingde announced on 25 July
that it took back the operating rights of its Pingshan Plant from
Hebei Jingye Steel and Iron Company Limited.
================
H O N G K O N G
================
HUA HAN: Fitch Puts 'BB-' FC IDR on Rating Watch Negative
---------------------------------------------------------
Fitch Ratings has placed Hua Han Health Industry Holdings
Limited's (Hua Han) Long-Term Foreign-Currency Issuer Default
Rating (IDR) of 'BB-', its senior unsecured rating of 'BB-' and
the 'BB-' rating on its USD150 million senior notes due 2019 on
Rating Watch Negative (RWN). This follows the delay in Hua Han's
response to allegations that it had inflated its revenue and cash
balance, which raises uncertainties over the robustness of the
company's corporate governance and internal controls.
KEY RATING DRIVERS
No Response to Allegations Yet: On Aug. 11, 2016, Hua Han halted
trading in its shares listed on the Hong Kong stock exchange
pending the release of a clarification regarding the negative
report from Hong Kong-based Emerson Analytics Co. Ltd. Hua Han
has not made further announcements since. Emerson's key
allegations are that Hua Han inflated its revenue by three-fold,
made questionable transactions and overstated its net tangible
assets by HKD2.8 billion versus Emerson's assessed value of
HKD1.73 billion.
Heightened Uncertainty Without Clarification: Until the company
successfully refutes these allegations, Fitch is unable to
determine the robustness of Hua Han's internal controls and
corporate governance.
No Immediate Financial Risk: Fitch believes the risk of Hua Han
facing immediate funding shortfall as a result of this event is
low. Hua Han's reported cash and equivalents of HKD4 billion at
end-December 2015 are sufficient to meet its capex needs and
payments to all its creditors. The total amount owed to trade
creditors and borrowers was HKD1.63 billion at end-December 2015
while we estimate Hua Han's additional capex through to 2017 will
be no more than HKD1.2 billion.
RATING SENSITIVITIES
Fitch expects to resolve the RWN once Hua Han responds to the
allegations. The RWN will be removed and the ratings and Outlook
affirmed at previous levels if the allegations are convincingly
refuted in a timely manner. Any extended delay or failure to
adequately address key allegations may result in a negative
rating action.
NOBLE GROUP: Pushes Back After Moody's Two-Step Rating Downgrade
----------------------------------------------------------------
Jasmine Ng and Megan Durisin at Bloomberg News report that Noble
Group Ltd. pushed back after a two-level downgrade by Moody's
Investors Service, with the commodity trader saying a planned
sale of a U.S. energy unit was progressing well and efforts to
cut costs and debt were making headway. Bond prices fell, while
shares rose, Bloomberg says.
"We remain on track to reposition the company as an asset-light
supply chain manager with high-returning businesses," Bloomberg
quotes spokesman Stephen Brown as saying on August 16 after the
Moody's announcement the day before. "Efforts to improve
liquidity and further deleverage continue through the completed
$500 million rights issue, the well-progressed sale of Noble
Americas Energy Solutions and other capital initiatives and cost-
cutting measures."
In a tumultuous 18 months, Noble Group has lost its blue-chip
status and investment-grade rating amid sliding commodity prices,
attacks on its accounting and losses, Bloomberg relates. Former
Chief Executive Officer Yusuf Alireza quit in May and days later
the company announced the emergency rights issue. Moody's move
contrasted with an assessment from Fitch Ratings Ltd. hours
before that Noble's liquidity crunch may be temporary, the report
states.
"Given the company's limited ability to generate positive
operating cash flow and the large debt maturities in the second
quarter of 2017, the company's liquidity could come under further
pressure over the next 12 months, despite the $500 million in
proceeds from its equity rights offering," Bloomberg quotes
Moody's Senior Credit Officer Joe Morrison as saying.
Bloomberg notes that Moody's downgrade to B2 brings the rating
five steps below investment grade. That compares with the BB+
rating by Fitch, which is one notch under investment level. Fitch
said on August 15 Noble will probably generate $900 million in
the coming months, including from the rights issue. The fund-
raising was supported by shareholders, including China's
sovereign wealth fund.
Noble Group's 2020 notes fell for a second day, losing 1.7 cents
to 77.3 cents on the dollar for a yield of 15.5% as of 5:20 p.m.
on August 16 in Hong Kong, according to Bloomberg-compiled
prices. The Singapore-listed shares, which fell to the lowest
since 2003 this month before the rights shares began trading,
closed 2.8% higher, Bloomberg discloses.
According to Bloomberg, Noble has lost more than half its market
value over the past year as prices of everything from oil to coal
and copper tumbled and its accounting methods came under attack
from critics including Iceberg Research. As the company sells
parts of its business and shuts down others, it has shrunk from a
$10.2 billion trading behemoth in 2010 to a shadow of its former
self, with a current market value of $1.4 billion, Bloomberg
discloses.
Bloomberg relates that Hong Kong-based Noble last week reported a
second-quarter loss, an increase in net debt and drop in its
liquidity headroom. The company got a waiver from banks relating
to one of the covenants in its revolving-credit facility and
borrowing-base facility for the period to June 30, it said. Chief
Financial Officer Paul Jackaman told Bloomberg last week after
the results that credit lines linked to particular commodities
are "constrained."
About Noble Group
Hong Kong-based Noble Group Limited (SGX:N21) --
http://www.thisisnoble.com/-- engages in supply of agricultural,
industrial and energy products. The Company supplies agricultural
and energy products, metals, minerals and ores .Agriculture
products include grains, oilseeds and sugar to palm oil, coffee,
and cocoa. Energy business includes coal, gas and liquid energy
products. In metals, minerals and ores (MMO), it supplies iron
ore, aluminum, special ores and alloys. The Company operates
nearly in 140 locations. It supplies growth demand markets in
Asia and Middle East. Alcoa World Alumina and Chemicals is the
subsidiary of this company.
As reported in the Troubled Company Reporter-Asia Pacific on
on Aug. 16, 2016, Fitch said Noble Group Limited's (Noble;
BB+/Stable) liquidity crunch in 2Q16 is temporary and the
Hong Kong-based commodities trader will have sufficient liquidity
in 3Q16, following its rights offering and working capital
reductions.
S&P Global Ratings in June lowered its long-term corporate credit
rating on Noble Group Ltd. to 'B+' from 'BB-'. The outlook is
negative. At the same time, S&P lowered the long-term issue
rating on Noble's outstanding senior unsecured notes to 'B' from
'B+'. In addition, S&P lowered its long-term Greater China
regional scale rating on the company to 'cnBB-' from 'cnBB' and
on the notes to 'cnB+' from 'cnBB-'.
NOBLE GROUP: Moody's Lowers CFR & Sr. Unsec. Bond Ratings to B2
---------------------------------------------------------------
Moody's Investors Service has downgraded Noble Group Limited's
corporate family rating and senior unsecured bond ratings to B2
from Ba3, and the provisional rating on its senior unsecured
medium-term note (MTN) program to (P)B2 from (P)Ba3.
The rating outlook is negative.
RATINGS RATIONALE
"The downgrade follows Noble's weaker than expected profitability
and cash flow in 2Q 2016, which necessitated a waiver under a
financial covenant in its recently concluded credit facilities,"
says Joe Morrison, a Moody's Vice President and Senior Credit
Officer.
"Given the company's limited ability to generate positive
operating cash flow and the large debt maturities in 2Q 2017, the
company's liquidity could come under further pressure over the
next 12 months, despite the $500 million in proceeds from its
equity rights offering," adds Morrison.
On August 11, Noble announced its 2Q 2016 results that indicated
that the commodity sector environment continues to pressure the
company's operations. Reported revenue and operating income from
supply chains for 2Q 2016 were $12.5 billion and $177 million,
respectively, down 32% and 46% year-on-year. Its reported
operating margin for 2Q 2016 also slipped to 1.42% from 2.19% in
1Q 2016 and 1.79% in 2Q 2015.
In addition, reported funds from operations (before interest
expenses) were only $48 million, insufficient to cover its cash
interest expenses of $51 million. Cash flow from operating
activities (CFO) for 2Q and 1H 2016 was negative $84 million and
negative $570 million, respectively.
The company's liquidity headroom decreased to about $800 million
at end-June 2016 from $1.9 billion at end-March 2016 because of
the expiry of credit facilities, while short-term debt grew to
$2.3 billion from $1.6 billion.
Given the persistently unfavorable operating environment,
negative CFO, and the ongoing discussions related to trade
facilities with banks, Moody's expects Noble's profitability and
cash flow to remain under pressure over the next 12 months, which
could further weaken liquidity and hinder its ability to maintain
compliance with financial covenants in its credit agreements.
This concern is partly mitigated by the $500 million in proceeds
from an equity rights issue and efforts it is making to reduce
working capital utilization and sell assets. Noble also said
that the sale of Noble Americas Energy Solutions (NAES) is on
track to close by the end of the year; however, the timing and
the scale of the sale remain uncertain.
Noble's adjusted net debt/EBITDA for the 12 months to June 2016
rose to about 5.6x from 4.0x in 2015.
The senior unsecured ratings are not notched down for legal
subordination. Although secured debt increased to about $621
million or about 12% of total debt at end-June 2016, Moody's
views that additional borrowings under the $2 billion borrowing
base facility are likely to be limited, because a large portion
of that facility is used to support letters of credit.
The B2 corporate family rating reflects Noble's large scale and
product and geographic diversity, tempered by the significant
pressures the company is facing in its operating environment and
the volatility of the commodity markets in which it operates.
The negative outlook reflects the company's weak liquidity and
uncertainty regarding its ability to rebuild and reposition its
operations to improve profitability and cash flow under the
prolonged commodity downcycle.
The rating outlook could return to stable, if (1) profitability
improves and the company is able to consistently generate
positive free cash flow and maintain cash balances at levels more
than sufficient to cover short-term debt; and (2) adjusted net
debt to EBITDA trends toward 5.0x.
However, Noble's ratings are likely to be downgraded further if
CFO remains consistently negative and liquidity deteriorates
further absent planned asset sales, or if adjusted net
debt/EBITDA remains in excess of 5.0x-6.0x.
The principal methodology used in these ratings was Trading
Companies published in June 2016.
Noble Group Limited is the largest global physical commodities
supply chain manager in Asia by revenue. Its diversified
activities across the supply chain include the sourcing, storage,
processing, transportation, and distribution of over 20 commodity
products.
Founder and Chairman, Mr. Richard Elman, holds an approximate 19%
stake in the company. China Investment Corporation -- the
Chinese sovereign wealth fund -- owns about 10% of the company.
=========
I N D I A
=========
AMBICO EXPORTS: CRISIL Reaffirms B+ Rating on INR240MM Loan
-----------------------------------------------------------
CRISIL's rating on the long-term bank facility of Ambico Exports
and Imports Private Limited continues to reflect an average
financial risk profile because of high total outside liabilities
to tangible net worth ratio and average interest coverage ratio.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Line of Credit 240 CRISIL B+/Stable (Reaffirmed)
The rating also factors in modest profitability and working
capital-intensive operations. These rating weaknesses are partly
offset by an increasing scale of operation, diverse product
portfolio, and the extensive experience of its promoters in the
diamond polishing segment.
Outlook: Stable
CRISIL believes Ambico will continue to benefit over the medium
term from the extensive industry experience its promoters and
established relationship with customers. The outlook may be
revised to 'Positive' in case of substantial improvement in the
financial risk profile, most likely because of fresh equity
infusion or sizeable accretion to reserves. The outlook may be
revised to 'Negative' the company's capital structure and
liquidity weaken further because of an increase in working
capital requirement, higher-than-expected debt-funded capital
expenditure, or a substantial decline in cash accrual.
Ambico was founded by Mr. Kalpesh Patel and Mr. Harshad Patel in
Mumbai in 2004. The company polishes rough diamonds and trades in
bulk chemicals. It derives most of its revenue from the diamond
polishing segment.
In fiscal 2016, on a provisional basis, profit after tax (PAT)
was INR7.0 million on net sales of INR1.45 billion; PAT was
INR5.0 million on net sales of INR995.0 million in fiscal2015.
ANMOL ASSOCIATES: CRISIL Assigns 'B' Rating to INR30MM Cash Loan
----------------------------------------------------------------
CRISIL has assigned its 'CRISIL B/Stable/CRISIL A4' ratings to
the bank facilities of Anmol Associates - Lucknow.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Bank Guarantee 20 CRISIL A4
Cash Credit 30 CRISIL B/Stable
The ratings reflect small scale of operations in the intensely
competitive civil construction industry with geographical
concentration and its average financial risk profile because of
modest networth. These rating weaknesses are mitigated by the
partner's extensive experience in the civil construction
industry.
Outlook: Stable
CRISIL believes that Anmol Associates - Lucknow will continue to
benefit over the medium term from its partners' extensive
industry experience. The outlook may be revised to 'Positive' if
the firm reports more-than-expected increase in its revenues and
profitability leading to higher-than-expected net cash accruals
by improving its working capital management. Conversely, the
outlook may be revised to 'Negative' if AS's financial risk
profile deteriorates on account of decline in its revenue and
profitability or in case of any larger-than-expected, debt-funded
capex or if AS's liquidity weakens significantly on account of
increase in its working capital requirements.
Anmol Associates promoted in 2013 as a partnership firm by Mr.
Neelesh Kumar Singh and Ms. Babita Singh and started its
commercial operations in December 2014. The firm mainly engaged
in construction and maintenance of road, sewage treatment and
civil construction in Uttar Pradesh for state and central govt.
authorities such as development authorities (DA), Central Public
Works Department (CPWD), UP Jal Nigam, state PWD and other
related Govt. infrastructure development authorities in Uttar
Pradesh
ANUBHAV PLAST: Ind-Ra Assigns 'IND B+' Long-Term Issuer Rating
--------------------------------------------------------------
India Ratings and Research (Ind-Ra) has assigned Anubhav Plast
Private Limited (APPL) a Long-Term Issuer Rating of 'IND B+'. The
Outlook is Stable.
KEY RATING DRIVERS
The ratings reflect APPL's small scale of operations, weak
margins and weak credit metrics. APPL's FY16 provisional
financials indicate around 15% yoy decline in its top line to
INR237.40 million due to less orders and EBITDA margins of 4.47%
(4.28%). The company's gross leverage (total adjusted net
debt/operating EBITDA) was 6.31x in FY16 (FY15: 7.04x) and gross
interest coverage (operating EBITDA/gross interest expense) was
1.61x (1.27x).
The ratings, however, are supported by APPL's comfortable
liquidity position as indicated by the average utilization of its
fund-based limits being around 90.23% during the 12 months ended
June 2016. The ratings are further supported by around 36 years
of experience of the company's promoter in the electrical pole
manufacturing business.
RATING SENSITIVITIES
Positive: Substantial growth in the company's top line along with
an improvement in its operating profitability leading to improved
credit metrics could lead to a positive rating action.
Negative: A decline in the operating profitability leading to
deterioration in the credit metrics could lead to a negative
rating action.
COMPANY PROFILE
Incorporated in 1987, APPL manufactures steel tubular poles,
traffic light pole, single hand light pole, double hang light
pole, pipes etc. at its facility in Kanpur, Uttar Pradesh. The
company procures hot rolled coil, steel pipes etc. from Steel
Authority of India Limited ('IND AA'/Negative), SMT Group, Rana
Steel and supplies the final product to government electricity
boards on tender basis.
APPL's ratings:
-- Long term Issuer Rating: assigned 'IND B+'/Stable
-- INR70 million fund-based limit: assigned
'IND B+'/Stable/'IND A4'
-- INR15 million non-fund-based limit: assigned 'IND A4'
-- Proposed INR15 million non-fund-based limit: assigned
'Provisional IND A4'
ASIAN OILFIELD: CRISIL Lowers Rating on INR380MM Loan to 'D'
------------------------------------------------------------
CRISIL has downgraded its ratings on the bank facilities of
Asian Oilfield Services Limited to 'CRISIL D/CRISIL D' from
'CRISIL BB-/Negative/CRISIL A4'. The rating downgrade reflects
non-payment of interest for over 30 consecutive days, as
continued losses weakened liquidity.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Cash Credit 250 CRISIL D (Downgraded from
'CRISIL BB-/Negative')
Letter of credit & 150 CRISIL D (Downgraded from
Bank Guarantee 'CRISIL A4')
Proposed Letter of 70 CRISIL D (Downgraded from
Credit 'CRISIL A4')
Standby Letter of 380 CRISIL D (Downgraded from
Credit 'CRISIL A4')
The rating reflects AOSL's weak financial risk profile, and
exposure to risks related to limited revenue visibility due to a
weak order book. These rating weaknesses are partially offset by
AOSL's experience in seismic-data acquisition and technical
expertise backed by its access to wireless technology.
For arriving at its ratings, CRISIL has combined the business and
financial risk profiles of AOSL and Asian Oilfield & Energy
Services DMCC. This is because these entities, together referred
to as AOSL, operate in the same business segments and have
operating and financial linkages.
AOSL was established in 1992 by a group of technocrats led by Mr.
Avinash Manchanda. The company provides seismic-data acquisition
and processing services to oil and gas exploration companies. In
2010-11, with shareholding of 36.33 per cent, Samara Capital, a
private equity fund, became the largest shareholder in AOSL
following a preferential allotment of equity shares.
Subsequently, the management of the company was taken over by
Samara Capital, while Mr. Manchanda has divested his equity
stake. In 2014-15, Samara Capital increased its shareholding to
56.32 per cent through a preferential allotment of equity shares.
In May 2016, Samara Capital entered into a share price agreement
with Oilmax Energy Pvt. Ltd. (Oilmax) transferring its entire
shareholding to the latter. Subsequently, Oilmax announced an
open offer for an additional 26 per cent stake to the public
shareholders of AOSL.
AOSL, on a consolidated basis, reported net loss of INR270
million on net sales of INR777 million for 2015-16, against net
loss of INR273 million on net sales of INR1408 million for 2014-
15.
ASSOCIATED APPLIANCES: CRISIL Reaffirms B- Rating on INR100M Loan
-----------------------------------------------------------------
CRISIL's ratings on bank facilities of Associated Appliances
Limited continue to reflect sustained pressure on liquidity,
reflected in subdued accrual and the stretched working capital
cycle.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Bank Guarantee 30 CRISIL A4 (Reaffirmed)
Cash Credit 100 CRISIL B-/Stable (Reaffirmed)
Inland/Import
Letter of Credit 110 CRISIL A4 (Reaffirmed)
Term Loan 30 CRISIL B-/Stable (Reaffirmed)
This has led to high bank limit utilization, with frequent
instances of overdrawals and instances of LC devolvement for few
days. The financial risk profile is weak, marked by high gearing
and average debt-protection metrics. These rating weaknesses are
partially offset by the stable business risk profile, on account
of increase in scale of operations and extensive experience of
promoters in the home and kitchen appliances industry.
Outlook: Stable
CRISIL believes that AAL will continue to benefit over the medium
term from its promoter's experience in the home and kitchen
appliances industry. The outlook may be revised to 'Positive' if
the company reports a significant improvement in scale of
operations and profitability, leading to large cash accruals and
consequently, improved financial risk profile. Conversely, the
outlook may be revised to 'Negative' if AAL reports a modest
scale of operations and profitability or if its financial risk
profile deteriorates owing to a significant increase in its
working capital requirements. The outlook may also be revised to
'Negative' if the company undertakes any large debt-funded
capital expenditure.
Update
Operating income is estimated at INR1090 million in fiscal 2016,
better than CRISIL's expectation of INR907 million, as some new
products were added to the portfolio. Operating margin was around
7.5% in fiscal 2016, in line with expectation and is expected to
improve, over the medium term. Working capital requirement
remained high, indicated by gross current assets of 174 days as
on March 31, 2016.
The financial risk profile remained weak due to high gearing of
2.09 times as on March 31, 2016 and average interest coverage
ratio of 1.40 times for fiscal 2016. The planned capital
expenditure programme of INR17.5 million will be funded through a
term loan of INR12 million and rest from equity or unsecured
loans, or internal accrual. Networth stood at INR137 million as
on March 31, 2016. CRISIL expects the financial risk profile to
remain weak over the medium term. Liquidity continued to be
stretched, with high bank limit utilization and some instances of
overdraws due to late payments from few customers; however cash
accrual has sufficed to meet the term-debt obligation. CRISIL
believes that liquidity would improve with better realizations
from debtors.
AAL was founded in New Delhi in 1994, by Mr Dev Dutta Sharma and
his family members. The company manufactures and trades in home
and kitchen appliances, including liquefied petroleum gas stoves
and kitchen ventilation hoods.
Net profit (on provisional basis) is estimated at INR7.20 million
on revenue of INR979 million for fiscal 2016, against net loss of
INR66.7 million on revenue of INR784 million, a year ago.
BAJRANG COTEX: CRISIL Assigns B+ Rating to INR45MM Cash Loan
------------------------------------------------------------
CRISIL has assigned its 'CRISIL B+/Stable' ratings to the bank
loan facilities of Bajrang Cotex.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Cash Credit 45 CRISIL B+/Stable
Term Loan 12.4 CRISIL B+/Stable
The ratings reflect BCT's small scale of operations and
vulnerability of profitability to fluctuation in the raw material
prices. The rating also factors in firm's below average financial
risk profile marked by small net worth, high gearing and below
average debt protection metrics. These rating weaknesses are
partially offset by extensive industry experience of the partners
in the cotton industry.
Outlook: Stable
CRISIL believes that BCT will benefit over the medium term from
the extensive experience of its partners in the cotton industry.
The outlook may be revised to 'Positive' if BCT reports higher-
than expected accruals, or improvement in working capital
management, leading to improvement in the financial risk profile.
Conversely, the outlook may be revised to 'Negative' in case BCT
reports lower-than expected accruals or its working capital cycle
is elongated, leading to deterioration in its financial risk
profile.
Established in 2012 as partnership firm, BCT is engaged in cotton
ginning and pressing with an installed capacity of 7000 metric
tonnes per annum. BCT has its manufacturing facility located at
Parbhani (Maharashtra). The firm is day to day operation of the
firm is looked after by Mr. Ramesh Dayma and Mr. Vijay Goyal.
BAJRANG COTTON: CRISIL Assigns B+ Rating to INR90MM Cash Loan
-------------------------------------------------------------
CRISIL has assigned its 'CRISIL B+/Stable' rating to the bank
loan facilities of Bajrang Cotton Private Limited.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Cash Credit 90 CRISIL B+/Stable
Term Loan 2.8 CRISIL B+/Stable
The ratings reflect BCPL's small scale of operations and
vulnerability of profitability to fluctuation in the raw material
prices. The rating also factors in company's below average
financial risk profile marked by small net worth, high gearing
and below average debt protection metrics. These rating
weaknesses are partially offset by extensive industry experience
of the partners in the cotton industry
Outlook: Stable
CRISIL believes that BCPL will benefit over the medium term from
the extensive experience of its promoters in the cotton industry.
The outlook may be revised to 'Positive' if BCPL reports higher-
than expected accruals, or improvement in working capital
management, leading to improvement in the financial risk profile.
Conversely, the outlook may be revised to 'Negative' in case BCPL
reports lower-than expected accruals or its working capital cycle
is elongated, leading to deterioration in its financial risk
profile.
Incorporated in 2011, BCPL is engaged in cotton ginning and
pressing with an installed capacity of 7000 metric tonnes per
annum. BCPL has its manufacturing facility located in Indore
(Madhya Pradesh). The day to day operation of the company is
looked after by Mr. Hemant Goyal.
BHAIRAVNATH POULTRY: CRISIL Reaffirms B Rating on INR96.6MM Loan
----------------------------------------------------------------
CRISIL's ratings on the bank facilities of Bhairavnath Poultry
Farms Private Limited continue to reflect its below-average
financial risk profile, because of modest networth, high gearing,
and weak debt protection metrics, and the vulnerability of
operating profitability to risks inherent in the poultry
industry. These weaknesses are partially offset by the extensive
experience of the promoters in the poultry industry.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Bank Guarantee 2.3 CRISIL A4 (Reaffirmed)
Cash Credit 96.6 CRISIL B/Stable (Reaffirmed)
Proposed Long Term
Bank Loan Facility 45.3 CRISIL B/Stable (Reaffirmed)
Term Loan 35.8 CRISIL B/Stable (Reaffirmed)
Outlook: Stable
CRISIL believes that BPFPL will continue to benefit over the
medium term from the promoters' extensive industry experience.
The outlook may be revised to 'Positive' if there is significant
and sustainable improvement in cash accrual while sustaining the
capital structure. Conversely, the outlook may be revised to
'Negative' if liquidity is constrained most likely by a decline
in sales and profitability or stretch in the working capital
cycle.
BPFPL was incorporated in 1995, promoted by Mr. Prasad Bhagat and
Mr. Krishnaji Bhagat. The company, based in Pune (Maharashtra),
is engaged in poultry farming.
BHARGAVA EDUCATIONAL: Ind-Ra Assigns 'IND B+' Rating to Term Loan
-----------------------------------------------------------------
India Ratings and Research (Ind-Ra) has assigned Bhargava
Educational Society's (BES) INR58 million term loan and INR5
million working capital facility Long-term 'IND B+' ratings. The
Outlook is Stable.
KEY RATING DRIVERS
The ratings are constrained by BES' current tight liquidity
profile and high debt burden. Provisional (P) FY16 numbers
indicate that its available funds/total long-term debt was 4.44%
(FY15: 2.87%) and debt/cash balance before interest and
depreciation (CBBID) was 3.68x (3.48x). Additionally, since BES
is in the initial years of operations, the agency believes it
will take another three-to-four years for operations to
stabilise. BES reported positive current balance (INR0.73
million) for the first time in FY15 and this further improved to
INR5.67 million in FY16 (P).
The ratings are supported by the high demand for BES' school in
the past three years; its headcount grew from 72 students in FY13
to 557 students in FY16. The school received regulatory approval
for 10th grade in 2016 and is in the process of expanding its
infrastructure to accommodate growing demand. Currently, it
provides education from kindergarten to 10th grade and plans to
subsequently increase this to 12th grade.
Ind-Ra expects BES' debt/CBBID, debt service coverage ratio and
interest service coverage ratio to become comfortable on the back
of stabilization of operations and a sustained improvement in
CBBID in the next three-to-four years. Additionally, the agency
believes its size of operations will increase on account of
growth in the total headcount.
RATING SENSITIVITIES
Positive: An improvement in liquidity and a falling debt burden,
along with sustained improvement in operating margins resulting
from strong growth in total headcount, could positively affect
the ratings.
Negative: Any unexpected fall in student demand, in conjunction
with a further increase in debt in relation to operating income,
could negatively affect the ratings.
COMPANY PROFILE
BES has a registered office in Banga, Punjab and was established
in 2011 under the Societies Registration Act, 1860. It runs one
school -- Darrick International School -- in Gunachaur, Punjab;
this was started in 2012 and received regulatory approval for
10th grade in 2016. It is accredited with the Central Board of
Secondary Education, Delhi.
BILCARE LIMITED: ICRA Assigns 'MC' Rating to INR125cr Loan
----------------------------------------------------------
ICRA has assigned 'MC' rating to the INR125.0 crore fixed deposit
program of Bilcare Limited.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Fixed Deposit Program 125.0 MC assigned
The assigned rating reflects Bilcare's stretched liquidity
profile and weak coverage indicators in the backdrop of net
losses in the business and leveraged capital structure. While
operations at standalone as well as consolidated level are
generating operating profits, large interest expense resulted in
net losses and erosion of net worth. Owing to strained liquidity
profile, the company has been delaying on its bank obligation and
the account has been classified as non-performing asset (NPA) by
the banks. Nevertheless, as by the management, Bilcare has been
regular in servicing its repayment obligation towards fixed
deposit holders. Going forward, company's ability to regularize
its repayment obligation towards banks as well as timely
servicing of its fixed deposit obligation remains key rating
sensitivity.
Incorporated in 1987, Bilcare Limited is primarily engaged in
manufacturing specialty pharmaceutical packaging barrier films.
Bilcare provides Pharmaceutical Packaging Innovation (PPI)
services and products, Global Clinical Services (GCS) and Anti-
Counterfeit technologies to major pharmaceutical companies. Over
the years, Bilcare has diversified its geographical presence by
organic and inorganic expansion. The company's manufacturing
facilities are located in India, Singapore, USA and Europe and
its R&D facilities are in India, Singapore and USA. In FY2016,
overseas revenue accounted for over 80% of company's consolidated
turnover.
Recent Results
In FY2016, at consolidated level, Bilcare reported an operating
profit (OPBIDTA) of INR232 crore on operating revenue of INR2,563
crore. During FY2016, at standalone level, Bilcare reported
operating profit of INR10.7 crore on operating revenue of
INR256.0 crore.
BRAND CONCEPTS: Ind-Ra Hikes LT Issuer Rating to 'IND BB'
---------------------------------------------------------
India Ratings and Research (Ind-Ra) has upgraded Brand Concepts
Pvt. Ltd's (BCPL) Long-Term Issuer Rating to 'IND BB' from
'IND BB-'. The Outlook is Stable.
KEY RATING DRIVERS
The upgrade reflects an improvement in BCPL's credit metrics. Its
interest coverage (operating EBITDA/gross interest expense)
improved to 4.06x in FY16 (FY15: 2.9x) and net leverage (total
adjusted net debt/operating EBITDAR) to 1.64x (2.53x). The
upgrade also factors in BCPL's comfortable liquidity position as
reflected by its working capital utilization of close to 75%
during the 12 months ended May 2016.
The ratings also take into account BCPL's moderate scale of
operations as reflected by its revenue of INR506 million in FY16
(FY15: INR387 million).
RATING SENSITIVITIES
Positive: Sustained improvement in the scale of operations along
with improvement in the interest coverage will be positive for
the ratings.
Negative: Sustained deterioration in the interest coverage and in
the overall liquidity profile will be negative for the ratings.
COMPANY PROFILE
Incorporated in 2007 BCPL sells branded goods all over the
country. It also has its own brands namely Sugarush in the ladies
handbags category and The Vertical in travel bags and small
leather goods categories.
BCPL's ratings:
-- Long-Term Issuer Rating: upgraded to 'IND BB' from 'IND BB-
'; Outlook Stable
-- INR77 million fund-based facilities: upgraded to
'IND BB'/Stable from 'IND BB-'/Stable
-- INR1.4 million term loan: assigned IND BB; Outlook Stable
-- INR31 million non-fund-based facilities: affirmed at
'IND A4+'
CEEKAY ASSOCIATES: Ind-Ra Assigns 'IND B+' LT Issuer Rating
-----------------------------------------------------------
India Ratings and Research (Ind-Ra) has assigned Ceekay
Associates a Long-Term Issuer Rating of 'IND B+'. The Outlook is
Stable. The agency has also assigned Ceekay's INR60 million fund-
based limits a Long-term 'IND B+' rating with a Stable Outlook.
KEY RATING DRIVERS
The ratings reflect Ceekay's weak credit metrics as reflected in
its interest coverage (operating EBITDAR/gross Interest expense +
rents) of 1.1x in FY16 (FY15:1.1x) along with net financial
leverage (total adjusted net debt/operating EBITDAR) of 8.1x
(4.9x) on account of low EBITDAR margins of 0.3% (0.2%). FY16
figures are provisional. The ratings are further constrained by
the proprietorship nature of the business.
The ratings benefit from the promoter's experience of around
three decades in the fasting moving consumer goods industry. The
ratings also derive comfort from the comfortable liquidity
position as reflected by the 78% average peak utilisation of the
fund-based limits during the six months ended June 2016.
RATING SENSITIVITIES
Positive: A sustained improvement in interest coverage will be
positive for the ratings.
Negative: Any deterioration in the liquidity position will be
negative for the ratings.
COMPANY PROFILE
Ceekay is a proprietorship firm established by Mr Shanti Kumar
Jain. It is an authorised distributor of Procter & Gamble in
Assam and operates through 20 offices cum warehouses. The
proprietor is also associated with businesses related to trading,
transportation and manufacturing computer paper.
CHANDRAKONA COLD: Ind-Ra Hikes LT Issuer Rating to 'IND B'
----------------------------------------------------------
India Ratings and Research (Ind-Ra) has upgraded Chandrakona Cold
Storage Private Limited's (CKCS) Long-Term Issuer Rating to
'IND B' from 'IND B-'. The Outlook is Stable.
KEY RATING DRIVERS
The upgrade reflects the improvement in CKCS's liquidity profile.
The company's EBITDA margins improved to 25.3% according to
provisional FY16 financials and to 24.3% in FY15 from 19.6% in
FY14, on account of an increase in the rent received for the
storage of potatoes. Revenue increased to INR27 million in FY16
(FY15: INR20 million; FY14: INR25 million). The company has
repaid all its debt availed from the bank.
CKCS's credit metrics continued to be moderate with interest
coverage of 3.0x in FY16P (FY15: 1.9x; FY14: 2.2x) and net
leverage of 1.2x (15.5x; 16.9x).
The ratings continue to be supported by the two-decade-long
experience of CKCS' founders in the cold storage business.
RATING SENSITIVITIES
Positive: Sustained improvement in the scale of operations along
with improvement in the overall credit profile will be positive
for the rating.
Negative: Detoriation in the liquidity position of the entity
will be negative for the rating.
COMPANY PROFILE
Incorporated in 1989, CKCS has a cold storage business through
which it stores potatoes. The cold store is located in Paschim
Mednipur, West Bengal, with a storage capacity of 221163.6
quintals of potatoes. It is managed by two of its directors,
Kannai Lal Roy and Jayanta Kumar Roy.
CKCS's ratings:
-- Long Term Issuer Rating: upgraded to 'IND B'/Stable from
'IND B-'/Stable
-- INR59.4 million fund based working capital limit: 'IND B-'/
Stable; rating withdrawn as the limits have been paid in
full.
-- INR12.4 million working capital loan: 'IND B-'/ Stable;
rating withdrawn as the limits have been paid in full.
-- INR2.9 million non-fund based working capital limit:
'IND A4'; rating withdrawn as the limits have been paid in
full.
-- Proposed INR50.0 million fund-based limit: assigned
'Provisional IND B'/Stable
CRIYAGEN AGRI: CRISIL Reaffirms 'B' Rating on INR160MM Term Loan
----------------------------------------------------------------
CRISIL's rating on the long-term bank loan facilities of
Criyagen Agri and Biotech Private Limited continues to reflect
the company's modest scale of operations, and its below-average
financial risk profile because of high gearing, small networth,
and subdued debt protection metrics. These weaknesses are
partially offset by the extensive experience of its promoter in
the fertilizer industry.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Overdraft Facility 19.9 CRISIL B/Stable (Reaffirmed)
Proposed Long Term
Bank Loan Facility 20.1 CRISIL B/Stable (Reaffirmed)
Proposed Term Loan 160.0 CRISIL B/Stable (Reaffirmed)
Outlook: Stable
CRISIL believes Criyagen will benefit over the medium term from
its promoter's extensive industry experience. The outlook may be
revised to 'Positive' if the company ramps up operations and
generates substantial revenue and profitability. The outlook may
be revised to 'Negative' if the company is unable to ramp up
operations, resulting in deterioration in its financial risk
profile.
Criyagen, incorporated in 2008 and promoted by Dr Basavaraj
Girennavar, manufactures bio-chemical fertilisers.
EXOTICA CERAMIC: ICRA Suspends B+ Rating on INR5cr Cash Loan
------------------------------------------------------------
ICRA has suspended [ICRA]B+ rating reaffirmed to the INR8.09
crore long term loans & working capital facilities & [ICRA]A4
rating reaffirmed to the INR2.25 crore, short term non-fund based
bank guarantee facilities of Exotica Ceramic Private Limited. The
suspension follows ICRA's inability to carry out a rating
surveillance due to non co-operation from the company.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Fund Based- Term Loans 3.09 [ICRA]B+ suspended
Fund Based- Cash Credit 5.00 [ICRA]B+ suspended
Non Fund Based- Bank
Guarantee 2.25 [ICRA]A4 suspended
According to its suspension policy, ICRA may suspend any rating
outstanding if in its opinion there is insufficient information
to assess such rating during the surveillance exercise. ICRA will
withdraw the rating in case it remains under suspension for a
period of three years.
Exotica Ceramic Private Limited is a digitally printed ceramic
wall tiles manufacturer with its plant situated at Morbi,
Gujarat. The company was incorporated in 2011 with commencement
of commercial operation in July 2011. Three directors namely Mr.
Jigneshbhai Rupala, Mr. Bharatbhai Rupala and Mr. Jigneshbhai
Kadivar manage the company. In FY13, the company has installed
digital printing machines. In FY15, the company has installed
second kiln increased installed capacity from 31938 MT to 55891
MT per annum.
GALAXY ENERGY: CRISIL Assigns 'B' Rating to INR150MM Cash Loan
--------------------------------------------------------------
CRISIL has assigned its 'CRISIL B/Stable' rating to long-term
bank facility of Galaxy Energy Solutions LLP.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Cash Credit 150 CRISIL B/Stable
The ratings reflect extensive entrepreneurial experience of
promoters and funding support extended by them. These strengths
are partially offset by nascent stage of operations, large
working capital requirement and below-average financial risk
profile, because of low networth and weak interest coverage
Outlook: Stable
CRISIL believes GES will continue to benefit over the medium term
from extensive entrepreneurial experience of promoters. The
outlook may be revised to 'Positive' if the firm reports
significant growth in revenue and operating profit margin, and
better working capital management. Conversely, the outlook may be
revised to 'Negative,' if GES' revenues and margins are lower-
than-expectation or a stretched working capital cycle weakens
financial metrics.
Incorporated in 2015, GES trades in energy efficiency fluid,
Hydromx, and is the sole distributor of the fluid in India. The
Jaipur-based firm has been promoted by Mr Abhineet Daga, Mr
Daulat Daga, Mr Kailsah Daga, Mr Pratap Daga and Mr Ankit Daga,
and commenced operations in August 2015.
H.K. AGRO: ICRA Assigns 'B' Rating to INR3.38cr Term Loan
---------------------------------------------------------
ICRA has assigned a long term rating of [ICRA]B and a short term
rating of [ICRA]A4 to INR10 crore bank facilities of H.K. Agro
Impex.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long-term - Term Loan 2.38 [ICRA]B; assigned
Long-term - Cash Credit 3.00 [ICRA]B; assigned
Short term - Pledge Loan 1.00 [ICRA]A4; assigned
Long Term/Short Term
Unallocated 3.62 [ICRA]B/[ICRA]A4;
assigned
The assigned ratings take into account the small scale of
operations of the firm and the competitive nature of the cashew
industry which limits the firms pricing flexibility. The ratings
also factor in the weak operating margins owing to the low value
added nature of the business, the susceptibility of margins to
the volatility in material prices and exchange rates owing to its
dependence on imports. The firm is also exposed to the inherent
risks associated with the proprietorship nature of the firm
including withdrawal of capital. The ratings, however, positively
factor in the significant scale up in operations from INR5.08
crore in FY2014 to INR16.70 crore in FY2016. Going forward, the
firm's ability to scale up its operations and improve its
profitability, capitalization and coverage indicators would be
the key rating sensitivities.
Established in 2014, H.K Agro Impex is a proprietorship firm
managed by Mr Mohammed Ansari. The firm is engaged in processing
cashew kernels from raw cashew nuts. The firm has its processing
unit in Mangalore, Karnataka with an installed capacity of
processing 60 bags of raw cashew nuts per day. The firm plans to
expand its processing capacity to 90 bags per day owing to
favourable demand prospects. The cost for this expansion is
estimated to be around INR1.22 crore funded by INR0.90 crore of
term loan and rest INR0.32 crore through promoter's contribution.
Recent Results
For 2014-15, the firm reported a net profit of INR0.06 crore on
an operating income of INR11.53 crore as against a net profit of
INR0.03 crore on an operating income of INR5.08 in 2013-14.
HBS REALTORS: ICRA Reaffirms 'B' Rating on INR53.56cr NCD
---------------------------------------------------------
ICRA has reaffirmed the long-term rating for the INR53.56 crore
Non-Convertible Debenture (NCD) program of HBS Realtors Private
Limited at [ICRA]B.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Non-Convertible
Debenture Program 53.56 [ICRA]B/ reaffirmed
The rating reaffirmation continues to factor in the significant
re-financing risk as part payment of the debentures falls due in
August 2016 while the cash flows generated by the SPVs are
inadequate to service the debt obligations. ICRA also notes the
considerable delays in project execution at SPV level on account
of delays in receiving key approvals which has led to cost over-
runs risks and constrained the sales collection from the
projects. The different projects continue to remain exposed to
regulatory risks, given that commencement certificate (CC) is yet
to be received for three of the on-going projects, and project
execution risks, considering nascent stage of all projects, with
construction yet to commence for three of the projects.
The rating, however, draws comfort from the long term promoter
experience in the real estate industry and the attractive
location of the four re-development projects, located in South
and South Central Mumbai. ICRA also notes that financial close
has been achieved for three of these SPVs.
Incorporated in 1995, HBS Realtors Private Limited ('HBS' or 'the
company') is a Mumbai-based real estate developer involved in
large scale city-centric developments in commercial as well
residential segments. The group has a diversified product mix
with a strong presence in residential, retail, commercial,
hospitality and SEZ developments. Over the last decade, HBS has
built strategic partnerships with reputed business houses such as
Phoenix Mills Limited for the development of its 'Marketcity'
projects, and with the Mody Group of JB Chemicals and
Pharmaceuticals for the development of its pharma SEZ project.
Over the years, HBS has also attracted various financial
investors like IL&FS, MPC Fund, SREI Infrastructure Finance Ltd.
and Edelweiss across its various projects. Since 2006-07, the
group has raised private equity and debt for its various
projects.
Recent Results
As per unaudited results, for the financial year ending March
2016, HBS reported operating income of INR37.36 crore and profit
after tax (PAT) of INR0.14 crore.
As per audited results, for the financial year ending March 2015,
HBS reported operating income of INR25.42 crore and profit after
tax (PAT) of INR1.51 crore.
IMMENSE INDUSTRIES: CRISIL Cuts Rating on INR350MM Loan to 'D'
--------------------------------------------------------------
CRISIL has downgraded its rating on bank facilities of Immense
Industries Private Limited to 'CRISIL D/CRISIL D' from 'CRISIL
BB/Stable/CRISIL A4+'.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Cash Credit 100 CRISIL D (Downgraded
from 'CRISIL BB/Stable')
Letter of Credit 350 CRISIL D (Downgraded
from 'CRISIL A4+')
The rating downgrade reflects deterioration in the financial risk
profile, particularly liquidity, marked by instances of letter of
credit devolvement, delay in servicing interest obligations and
overutilisation of the cash credit limit, due to stretched
debtors. CRISIL expects liquidity to remain weak, over the medium
term, due to expected delay in realisations from customers.
CRISIL's rating on long-term bank facilities continues to reflect
exposure to risks related to the fragmented metal and yarn
trading business, with low profitability and moderate debtor
risk. These rating weaknesses are partially offset by extensive
experience of promoters in the yarn industry.
Incorporated in 1988, IIPL trades in yarn and metal products
(scrap ingots). Daily operations of the Delhi-based company are
managed by Mr Somnath Harjai.
INDIAN BANK: Fitch Affirms & Withdraws 'B' Issuer Default Ratings
-----------------------------------------------------------------
Fitch Ratings has affirmed and withdrawn the ratings of Indian
Bank. Fitch has chosen to withdraw the ratings of Indian Bank for
commercial reasons.
KEY RATING DRIVERS
There has been no material change in Indian Bank's credit profile
since the previous rating actions on July 5, 2016. For more
information on the rating drivers, please see Fitch Affirms 9
Indian Banks' IDRs; Downgrades VRs of Canara, IDBI and Indian
Bank - Ratings Navigator.
RATING SENSITIVITIES
Rating sensitivities are not applicable as the ratings have been
withdrawn.
Fitch has affirmed and withdrawn the following ratings:
-- Long-Term Issuer Default Rating (IDR) at 'BB+'; Outlook
Stable;
-- Short-Term IDR at 'B'
-- Viability Rating at 'bb+'
-- Support Rating at '3'
-- Support Rating Floor at 'BB+'
INTERNATIONAL AGRO: ICRA Suspends B Rating on INR17cr Term Loan
---------------------------------------------------------------
ICRA has suspended the long term rating of [ICRA]B outstanding on
the INR17.00 crore term loans and the INR10.00 crore cash credit
facilities of International Agro Foods. The suspension follows
ICRA's inability to carry out a rating surveillance in the
absence of the requisite information from the company.
JAY UMIYA: ICRA Reaffirms 'B' Rating on INR5.50cr Cash Loan
-----------------------------------------------------------
ICRA has reaffirmed the [ICRA]B rating assigned to the INR1.34
crore1 term loan facility and INR5.50 crore cash-credit facility
of Jay Umiya Industries.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Cash Credit Facility 5.50 [ICRA]B reaffirmed
Term Loan Facility 1.34 [ICRA]B reaffirmed
Rating Rationale
The rating reaffirmation takes into account JUI's modest size of
operations and weak financial profile characterized by low
profitability levels, owing to the limited value addition in the
business and the highly competitive and fragmented industry
structure; stretched capital structure and weak coverage
indicators. The rating is also constrained by the vulnerability
of the firm's profitability to adverse raw material prices, which
are subject to seasonality, and crop harvest; and the regulatory
risks with regard to MSP fixed by GoI. ICRA also notes that JUI
is a partnership firm and any significant withdrawals from the
capital account would affect its net worth and thereby its
capital structure.
The rating, however, positively considers the established track
record of the firm in the cotton ginning industry and the
advantage the firm enjoys by virtue of its location in the cotton
producing belt of Mehsana (Gujarat).
Established in 1997, Jay Umiya Industries (JUI) is engaged in the
business of ginning and pressing of raw cotton into cotton seeds
and fully pressed cotton bales having a production capacity of
about 34 metric tonnes per day (MTPD) of cotton bales. The firm
is also engaged in crushing of cotton seeds to obtain cotton seed
oil and cotton oil cake having an intake capacity of about 16
MTPD. The plant located at Kadi-Mehsana in Gujarat is equipped
with 26 ginning machines, one fully automated pressing machine
and three expellers. The firm is promoted by Mr. Jayram Patel
along with his relatives and friends who have more than a decade
of experience in the cotton ginning business.
KASTURCHAND FERTILIZERS: Ind-Ra Cuts LT Issuer Rating to 'IND B+'
-----------------------------------------------------------------
India Ratings and Research (Ind-Ra) has downgraded Kasturchand
Fertilizers (P) Ltd's (KFPL) Long-Term Issuer Rating to 'IND B+'
from 'IND BB-'. The Outlook is Stable.
KEY RATING DRIVERS
The downgrade reflects the deterioration in KFPL's credit profile
with interest coverage reducing to 1.4x according to FY16
provisional financials (FY15: 1.7x; FY14: 1.7x) and net leverage
(net debt/EBITDA) of 5.2x (FY15: 6.4x; FY14: 3.0x). The
deterioration was on account of an increase in the company's debt
to INR126.36 million in FY16 from INR70.44 million in FY15 (FY14:
INR28.42 million). Increase in debt was majorly a result of the
elongated working capital cycle of 311 days in FY16 (FY15: 418
days; FY14: 185 days) led by a change in the inventory policy
under which the company decided to stock higher volumes of raw
material to benefit from quantity discounts. The company had
inventory of 447 days in FY16 (FY15: 630 days; FY14: 266 days).
The company's scale of operations remained small despite revenue
increasing 55.9% yoy to INR180 million in FY16. The ratings also
factor in the improvement in the EBITDA margins to 13.4% in FY16
from 9.3% in FY15 and 8.3% in FY14.
The ratings continue to derive strength from the two-decade-long
experience of KFPL's promoters in the fertiliser industry and the
established presence of its brand KRUSHIDHAN in the Vidharba
region of Maharashtra.
RATING SENSITIVITIES
Positive: Substantial revenue growth while maintaining the
profitability, leading to an improvement in the credit metrics
would be positive for the ratings.
Negative: A decline in profitability and/or further elongation in
the net working capital cycle leading to deterioration in the
credit metrics would be negative for the ratings.
COMPANY PROFILE
Established in 1995, KFL manufactures NPK and SSP fertilisers. It
was founded by Munnalal Agrawal. KFL has a manufacturing facility
of 66,000mtpa located in Gadchiroli, Maharashtra. Its fertilisers
are distributed under the brand name, KRISHIDHAN in the adjoining
areas of Vidharba region through a network of distributors and
retailers. The company has a seasonal operating cycle with peak
procurement between November and March while manufacturing and
sales occur between April and October.
KFPL's ratings:
-- Long-Term Issuer Rating: downgraded to 'IND B+'/Stable from
'IND BB-'/Stable
-- INR100 million cash credit working capital facilities:
downgraded to 'IND B+'/Stable from 'IND BB-'/Stable
-- INR5.5 million non-fund-based limits: downgraded to
'IND A4' from 'IND A4+'
LOK RAJ: CRISIL Assigns 'D' Rating to INR120MM Cash Loan
--------------------------------------------------------
CRISIL has assigned its 'CRISIL D/CRISIL D' ratings to bank
facilities of Lok Raj Saini Infra-Tech Private Limited.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Working Capital
Term Loan 98.7 CRISIL D
Funded Interest
Term Loan 35.8 CRISIL D
Bank Guarantee 5.5 CRISIL D
Cash Credit 120.0 CRISIL D
The ratings reflect delay in meeting the debt obligation, due to
weak liquidity, resulting from high operational losses. Lack of
new orders have led to a constant decline in revenue. These
weaknesses are partially offset by extensive experience of
promoters in the road construction industry.
Set up as a proprietorship concern by Mr. Lokraj Saini in 1987,
it was reconstituted as a partnership firm in April 2008 and a
private limited company in 2010. The company undertakes
construction of roads, bridges and other infrastructure
development projects, mainly in Himachal Pradesh (HP), mainly for
government departments like H.P. Public Works Department.
MANN RESIDENCY: CRISIL Hikes Rating on INR190MM Loan to 'C'
-----------------------------------------------------------
CRISIL has upgraded its rating on the long-term bank facility of
Mann Residency Private Limited to 'CRISIL C' from 'CRISIL D'.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Term Loan 190 CRISIL C (Upgraded from
'CRISIL D')
The rating upgrade is driven by improvement in liquidity as
indicated timely payment of the debt obligation and expected
increase in cash accrual. Growth in operating income and infusion
of unsecured loans from directors are likely to support timely
repayment of debt over the medium term. However, CRISIL believes
that liquidity, though improved, will remain constrained over the
medium term, due to the modest operating income.
The rating reflects a weak financial risk profile because of a
negative networth, driven by losses incurred in previous years.
The rating also factors in a small scale of operations in the
hospitality industry, and limited track record in managing a
hotel. These rating weaknesses are partially offset by a
favourable location.
MRPL, incorporated in 2007 and promoted by Mr. Joginder Singh
Mann and his family members, operates a four-star hotel, Hotel
Clarens, in Gurugram, Haryana. The hotel became operational in
October 2011.
MEWAR UNIVERSITY: CRISIL Lowers Rating on INR296.7MM Loan to D
--------------------------------------------------------------
CRISIL has downgraded its rating on the bank facility of
Mewar University to 'CRISIL D' from 'CRISIL BB/Stable'.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Term Loan 296.7 CRISIL D (Downgraded
from 'CRISIL BB/Stable')
The rating reflects MU's delays in servicing its debts. There is
an ongoing delay in servicing its term loan obligations on
account of liquidity mismatch. The trust also has geographic
concentration in its business risk profile and susceptibility to
regulatory risks associated with educational institutions.
However, trust has promoters' extensive experience in the
education sector.
MU was set up in 2008 under Mewar Education Society (MES) and in
2009 it became an autonomous university. MES is only a sponsoring
body with around six members in the board of MU. MU offers
engineering, computer application, management, education and law
education. The university is located in Chittorgarh (Rajasthan).
MULTITECH AUTO: Ind-Ra Assigns 'IND BB+' Long-term Issuer Rating
----------------------------------------------------------------
India Ratings and Research (Ind-Ra) has assigned Multitech Auto
Private Limited (MAPL) a Long-Term Issuer Rating of 'IND BB+'.
The Outlook is Stable.
KEY RATING DRIVERS
Ind-Ra has taken a consolidated view of MAPL group comprising
MAPL and Mal Metalliks Private Limited (MMPL) due to the moderate
linkages between the two companies as the latter is a subsidiary
of MAPL and also provides around 90% of MAPL's total raw material
requirement.
The ratings reflect MAPL group's moderate scale of operations and
credit profile. The group's provisional financials for FY16
indicate revenue of INR559 million (FY15: INR466 million),
operating EBITDA interest coverage (EBITDA/gross interest) of
2.6x (2.2x), net leverage (net debt/EBITDA) of 2.0x (3.0x) and
operating EBITDA margin of 9.2% (9.4%).
MAPL's standalone provisional FY16 financials reflect revenue of
INR559 million (FY15: INR470 million), interest coverage of 2.7x
(2.3x), net leverage of 2.1x (2.6x) and an EBITDA margin of 5.0%
(5%). MAPL's liquidity position is strong with 68% average
utilisation of the working capital limits during the 12 months
ended June 2016.
The ratings are supported by the MAPL's founders' experience of
more than two decades in manufacturing auto-parts and supplying
these parts to all the plants of Tata Motors Limited in India.
RATING SENSITIVITIES
Positive: A substantial growth in MAPL's revenue leading to an
improvement in the group's credit metrics could be positive for
the ratings.
Negative: A dip in the MAPL's operating profitability, leading to
deterioration in the group's credit metrics could be negative for
the ratings.
COMPANY PROFILE
Jamshedpur-based MAPL was incorporated in 1995. It manufactures
automobile parts for Tata Motors Limited. It setup a new company
M/s Mal Metalliks Pvt. Ltd. in Jamshedpur, as its subsidiary for
manufacturing bright steel bars with an installed capacity of
3000mt per year, in 2009 the subsidiary unit also started the
production of casting components as a part of backward
integration with a capacity of 6000mt per year. The group is
managed by Mr. Atul Dua, Mr. Surendra Gadia and Mr. Dinesh Kumar
Parik.
MRM's ratings:
-- Long-Term Issuer Rating: assigned 'IND BB+'; Outlook Stable
-- INR55 million fund-based working capital limits: assigned
'IND BB+'/Stable
-- INR75 million long term loan limits: assigned
'IND BB+'/Stable
PANACHE ALUMINIUM: ICRA Suspends 'D' Rating on INR22cr Loan
-----------------------------------------------------------
ICRA has suspended [ICRA]D rating assigned to the INR22.00 crore
fund based facilities of Panache Aluminium Extrusions Pvt. Ltd.
The suspension follows ICRA's inability to carry out a rating
surveillance in the absence of the requisite information from the
company.
Established in 2009, Panache Aluminium Extrusions Pvt. Ltd. is
engaged in the manufacturing of aluminium extrusion profiles. The
manufacturing facility of the company having an installed
capacity of 10200 metric tonnes per annum (MTPA) is located at
Ahir in the Satara district of Maharashtra. The plant falls under
the 'D' zone of industrial area in Maharashtra, which has many
benefits such as stamp duty exemption, electricity duty
exemption, refund of sales tax to the extent of 25% of VAT
payable etc. The products manufactured by PAEPL find application
mainly in fabrication, transport and electrical industries.
PARVATIYA PLYWOOD: CRISIL Reaffirms B+ Rating on INR57.5MM Loan
---------------------------------------------------------------
CRISIL's rating on the long-term bank facilities of Parvatiya
Plywood Private Limited continues to reflect PPPL's modest scale
of operations, and large working capital requirement. These
rating weaknesses are partially offset by the extensive
experience of promoters in the wood panels industry and an
average financial risk profile, marked by average debt protection
metrics.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Cash Credit 57.5 CRISIL B+/Stable (Reaffirmed)
Term Loan 12.5 CRISIL B+/Stable (Reaffirmed)
Outlook: Stable
CRISIL believes PPPL will maintain its credit risk profile over
the medium term, backed by its long track record of operations
and the extensive industry experience of promoters. The outlook
may be revised to 'Positive' if scale of operations increases,
leading to higher-than-expected cash accrual or infusion of
funds, improves liquidity. Conversely, the outlook may be revised
to 'Negative' if the financial risk profile deteriorates, most
likely because of large, debt-funded capital expenditure (capex)
or a significant increase in working capital, leading to
deterioration in liquidity.
Update
PPPL is estimated to have recorded operating income of INR158.4
million in fiscal 2016 (Rs 145.1 million in fiscal 2015. The
increase in sales was on account of increase in price
realisations and customer addition. Operating margin is estimated
at 11-12% in fiscal 2016. Operations have remained working
capital intensive as reflected in estimated gross current assets
of 270-280 days, driven by large inventory days as on March 31,
2016.
Financial risk profile is marked by estimated moderate gearing of
1.52 times as on March 31, 2016. Debt protection metrics'interest
coverage and net cash accrual to total debt ratios of 2.09 times
and 0.13 times, respectively, in fiscal 2016'is estimated to
remain average. The company does not have any capex planned for
the medium term, apart from ongoing capex for current building,
staff quarters, and warehouse.
Liquidity is marked by full bank limit utilisation for the 12
months through June 2016, on account of working capital-intensive
operations. Cash accrual is expected to be at INR10 million
against debt obligation of INR3 million in fiscal 2017. Funding
support from the promoters in form of unsecured loans was
estimated at INR28.8 million as on March 31, 2016.
Established in 1987 by Mr Akhilesh Pratap Saraswat and his family
members in Ram Nagar (Nainital; Uttarakhand), PPPL manufactures
various grades of plywood, block boards, and flush doors.
PREMIER CONVEYORS: ICRA Assigns 'B' Rating to INR2.75cr LT Loan
---------------------------------------------------------------
ICRA has assigned a long term rating of [ICRA]B to the INR2.75
crore fund based cash credit limits and to the INR2.00 crore fund
based EPC limits which are a sub limit to the cash credit limits
of Premier Conveyors Private Limited. ICRA has also assigned a
short term rating of [ICRA]A4 to the INR2.15 crore Non Fund based
bank facilities of PCPL.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long Term- Fund
Based (Cash Credit) 2.75 [ICRA]B; assigned
Long Term- Fund
Based (EPC) (2.00) [ICRA]B; assigned
Short Term- Non
Fund Based (Letter
of Credit) 2.15 [ICRA]A4; assigned
The assigned ratings take into account the long standing
experience of the promoters in the business of manufacture of
conveyor belts and the established relationship of the company
with its clients over the years.
The ratings are however, constrained by PCPL's moderate
financials profile characterized by small scale of operations,
low net worth base, moderate profitability and debt coverage
indicators. The ratings also factor in the exposure of the
company's profitability to volatility in raw material prices and
foreign exchange rate. Further, the ratings also remain
constrained by the high inventory requirements which keep the
liquidity under pressure, although the same have witnessed
moderation over the last two years on the back of better
inventory management by the company.
Going forward, the ability of the company to improve its scale of
operations, maintain healthy profitability and capital structure
while efficiently managing its working capital cycle will be a
key rating consideration.
Established in 2006, Premier Conveyors Private Limited is engaged
in the manufacture of rubber conveyor belt. The company's
manufacturing facility is located at Wada in Thane district of
Maharashtra. The founder of the company Mr. C L Aggarwal started
his first conveyor belt manufacturing firm 37 years back in
Amritsar namely Premier Rubber Mills. The company manufactures
general purpose, heat resistant and fire resistant rubber
conveyor belts. The company's product finds its application in
several industries like mining, thermal power plants, material
handling etc.
Recent Results:
On a provisional basis, for the financial year ending March 31,
2016, PCPL reported an operating income OI) of INR16.08 crore and
a profit after tax (PAT) of INR0.26 crore as compared to an OI of
INR16.36 crore and a PAT of INR0.16 crore in the previous year.
R.A. MOTORS: CRISIL Reaffirms B+ Rating on INR100MM Loan
--------------------------------------------------------
CRISIL's rating on the long-term bank facilities of R.A. Motors
Private Limited continues to reflect the company's modest
financial risk profile because of a small networth, high total
outside liabilities to tangible networth ratio, and weak debt
protection metrics on account of low profitability.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Cash Credit 75 CRISIL B+/Stable (Reaffirmed)
Channel Financing 75 CRISIL B+/Stable (Reaffirmed)
Corporate Loan 50 CRISIL B+/Stable (Reaffirmed)
Electronic Dealer
Financing Scheme
(e-DFS) 100 CRISIL B+/Stable (Reaffirmed)
The rating also factors in the company's susceptibility to
cyclicality in the automobile industry and to intense competition
in the automotive dealership business, and its limited bargaining
power with its principal, Tata Motors Ltd (TML; 'CRISIL
AA/Stable/CRISIL A1+'). These weaknesses are partially offset by
RAMPL's established relationship with TML, and its promoters'
extensive industry experience.
Outlook: Stable
CRISIL believes RAMPL will continue to benefit over the medium
term from its established market position as a dealer of TML's
commercial vehicles (CVs). The outlook may be revised to
'Positive' in case of substantial equity infusion or significant
increase in the company's revenue and profitability, leading to
better cash accrual, and hence, to an improvement in its capital
structure and debt protection metrics. The outlook may be revised
to 'Negative' if its financial risk profile deteriorates because
of large debt-funded capital expenditure or substantial working
capital requirement.
RAMPL is an authorised dealer for TML's CVs with four showrooms
and nine sales offices covering Etah, Moradabad, Badaun, Kasganj,
Sambhal, Amroha, and Bareilly, in Uttar Pradesh. The company
deals in the entire range of TML's CVs.
ROOP RAM: CRISIL Raises Rating on INR140MM LT Loan to 'C'
---------------------------------------------------------
CRISIL has upgraded its ratings on the bank facilities of Roop
Ram Educare Private Limited to 'CRISIL C /CRISIL A4' from 'CRISIL
D/CRISIL D'.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Overdraft Facility 10 CRISIL A4 (Upgraded
from 'CRISIL D')
Proposed Long Term 140 CRISIL C (Upgraded
Bank Loan Facility from 'CRISIL D')
Term Loan 50 CRISIL C (Upgraded
from 'CRISIL D')
The upgrade reflects RREPL's timely servicing of debt because of
improved liquidity, and the expected increase in its cash accrual
because of expected high student intake resulting in a better
operating margin. CRISIL believes RREPL's liquidity, though
improved, will remain constrained over the medium term because of
modest operating income.
The company has a weak financial risk profile because of a high
total outside liabilities to tangible networth ratio and weak
debt protection metrics. However, it benefits from the extensive
experience of its promoters in the education industry.
RREPL was started in 2007 by Mr Anand Singh Mann and his family
members. The company oeprates Lancers International School at
Gurgaon, Haryana. The school follows the International
Baccalaureate (IB) and the University of Cambridge International
Examinations (CIE) syllabus, and has classes from kindergarten to
standard 12.
SALIA POLYMERS: CRISIL Assigns B- Rating to INR45MM Cash Loan
-------------------------------------------------------------
CRISIL has assigned its 'CRISIL B-/Stable' rating to the long-
term bank facilities of Salia Polymers Private Limited.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Cash Credit 45 CRISIL B-/Stable
Long Term Loan 25 CRISIL B-/Stable
The rating reflects SPPL's small scale of operations in the
intensely competitive packaging industry, its susceptibility of
operating margins to intense competition and volatility in prices
of raw material, and below average financial risk profile marked
by low net worth and weak debt protection metrics. The rating
weakness are partially offset by moderate experience of the
promoters in the plastic products industry and its customer and
supplier relationships.
Outlook: Stable
CRISIL believes that SPPL will continue to benefit over the
medium term from its promoter's experience in the plastic
products industry. The outlook may be revised to 'Positive' in
case of substantial improvement in SPPL scale of operations,
leading to better-than-expected cash accruals. Conversely, the
outlook may be revised to 'Negative' in case of lower-than-
expected cash accruals or larger-than-expected debt funded capex
plans and weakening in its working capital management.
Based in Prakasam (Andhra Pradesh), Salia Polymer private limited
(SPPL) was set up in 2010 for manufacture of EPS (expanded
polystyrene) packaging boxes. SPPL is promoted by Mr.D
Ramakrishna Raju.
SANGAR OVERSEAS: Ind-Ra Hikes Long-Term Issuer Rating to 'IND B'
----------------------------------------------------------------
India Ratings and Research (Ind-Ra) has upgraded Sangar Overseas'
(Sangar) Long-Term Issuer Rating to 'IND B' from 'IND B-'. The
Outlook is Stable.
KEY RATING DRIVERS
The upgrade reflects an improvement in Sangar's scale of
operations and credit metrics over FY14-FY16. According to the
firm's provisional FY16 financials, its revenue was INR296.87m
(FY15: INR287.7 million; FY14: INR254.44 million), financial
leverage (Ind-Ra adjusted debt/operating EBITDAR) was 6.13x
(5.51x; 6.6x) and interest coverage (operating EBITDA/gross
interest expense) was 1.54x (1.37x; 1.32x). The operating margins
remained moderate at 6.63% in FY16 (FY15: 6.94%; FY14: 6.03%).
The ratings are supported by over two decades of operating
experience of the firm's founders in the readymade garments
industry and the firm's 18 years long operational history.
The ratings continue to be constrained by the tight liquidity
position of the firm. This is due to the overutilization of fund-
based-limits (utilized to full extent during the eight months
ended June 2016) despite coming down to one day in a month
compared to 10-20 days in a month during the last rating
exercise.
RATING SENSITIVITIES
Negative: Further stretch on the liquidity profile could be
negative for the ratings.
Positive: An improvement in the liquidity profile and/or
improvement in the credit metrics could be positive for the
ratings.
COMPANY PROFILE
Established in 1996, Sangar is based in Gurgaon and managed by
Rajiv Sangar and Gloria Sangar. The firm manufactures and exports
readymade garments specially kids wear. The unit is registered as
a SSI unit with DIC, Gurgaon. The firm has an installed capacity
of 400,000 pieces of garments annually at Udyog Vihar, Gurgaon.
Sangar's ratings:
-- Long-Term Issuer Rating: upgraded to 'IND B' from 'IND B-';
Outlook Stable
-- INR100 million fund-based limits (increased from INR92.5
million): upgraded to 'IND B'/Stable from 'IND B-'/Stable
and affirmed at 'IND A4'
-- INR72.5 million non-fund-based limits (increased from
INR10 million): affirmed at 'IND A4'
-- INR4 million o/s term loans (decreased from INR14.65
million): upgraded to 'IND B'/Stable from 'IND B-'/Stable
SAYONA COLORS: CRISIL Lowers Rating on INR450MM Cash Loan to D
--------------------------------------------------------------
CRISIL has downgraded its ratings on the bank facilities of
Sayona Colors Private Limited to 'CRISIL D/CRISIL D' from
'CRISIL BB-/Negative/CRISIL A4'.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Cash Credit 450 CRISIL D (Downgraded
from 'CRISIL BB-/Negative')
Letter of Credit 400 CRISIL D (Downgraded
from 'CRISIL A4')
The downgrade reflects continued irregularities in working
capital limit beyond 30 days.
As Sayona's management has not been cooperative, the rating
action has been carried out on the basis of best available
information. CRISIL has obtained information, from sources it
believes to be reliable, that liquidity is under pressure and the
company has not been regular in servicing its debt obligation.
Established in 2004 in Ahmedabad as a proprietorship concern
(Sencient India) by Mr. Paresh Patel (key promoter and managing
director) and reconstituted as a private limited company
(Sencient India Export Pvt Ltd) in 2007, Sayona manufactures
synthetic food colours. Name was changed to the current one in
2009.
SHIVA TRADING: CRISIL Assigns B+ Rating to INR35MM Cash Loan
------------------------------------------------------------
CRISIL has assigned its 'CRISIL B+/Stable/CRISIL A4' ratings to
the bank facilities of Shiva Trading Company.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Proposed Long Term
Bank Loan Facility 20 CRISIL B+/Stable
Cash Credit 35 CRISIL B+/Stable
Letter of Credit 45 CRISIL A4
The ratings reflect modest scale of operations, low operating
margin in the competitive and fragmented steel industry, and
working capital-intensive operations. These rating weaknesses are
partially offset by the extensive industry experience of the
firm's proprietor.
Outlook: Stable
CRISIL believes STC will continue to benefit over the medium term
from the extensive industry experience of its proprietor. The
outlook may be revised to 'Positive' in case of higher-than-
expected growth in revenue and profitability, leading to
improvement in cash accrual and liquidity. The outlook may be
changed to 'Negative' if liquidity deteriorates due to a
stretched working capital cycle or lower-than-expected cash
accrual.
STC is a sole proprietorship concern established in 1991 by Mr
Vijay Kumar Gupta. The firm, based in Chennai, trades and
processes a wide range of stainless steel coils and strips.
SHREE RAM: CRISIL Assigns 'B' Rating to INR60MM Cash Loan
---------------------------------------------------------
CRISIL has assigned its 'CRISIL B/Stable' rating to the bank loan
facilities of Shree Ram Cotex.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Cash Credit 60 CRISIL B/Stable
Term Loan 27.5 CRISIL B/Stable
The rating reflects SRC's nascent stage of operations and
vulnerability of profitability to fluctuation in the raw material
prices and below average financial risk profile marked by small
net worth, high gearing and below average debt protection
metrics. These rating weaknesses are partially offset by
extensive industry experience of the partners in the cotton
industry.
Outlook: Stable
CRISIL believes that SRC will benefit over the medium term from
the extensive experience of its partners in the cotton industry.
The outlook may be revised to 'Positive' if SRC reports higher-
than expected accruals, along with effective working capital
management, leading to improvement in the financial risk profile.
Conversely, the outlook may be revised to 'Negative' in case SRC
reports lower than expected accruals or its the working capital
cycle is elongated, leading to deterioration in its financial
risk profile.
Established in 2015 as partnership firm, SRC is engaged in cotton
ginning and pressing with an installed capacity of 7000 metric
tonnes per annum. The firm has its manufacturing facility located
in Wardha (Maharashtra), the operation of which commenced from
December 2015. The firm is managed by Mr. Sanjay Goyal and Mr
Dilip Goyal who have over two decades of experience in similar
line of business.
SHRI BIJASANI: CRISIL Reaffirms 'B' Rating on INR70MM Cash Loan
---------------------------------------------------------------
CRISIL's rating on the long-term bank facilities of Shri Bijasani
Cotton Fiber continues to reflect SBCF's weak financial risk
profile, marked by a small net worth, high gearing, and weak debt
protection metrics.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Cash Credit 70 CRISIL B/Stable (Reaffirmed)
Proposed Cash
Credit Limit 12.5 CRISIL B/Stable (Reaffirmed)
Proposed Long Term
Bank Loan Facility 32.5 CRISIL B/Stable (Reaffirmed)
Term Loan 15.0 CRISIL B/Stable (Reaffirmed)
The rating also factors in the firm's vulnerability to volatility
in raw material prices, and its small scale of operations in the
intensely competitive cotton ginning industry. These rating
weaknesses are partially offset by the extensive industry
experience of SBCF's partners.
Outlook: Stable
CRISIL believes that SBCF will continue to benefit over the
medium term from its partners' extensive experience in the cotton
ginning industry. The outlook may be revised to 'Positive' if the
firm sustains a healthy improvement in its profitability, leading
to better debt protection metrics. Conversely, the outlook may be
revised to 'Negative' if SBCF's financial risk profile
deteriorates, most likely because of sizeable working capital
requirements or lower-than-anticipated net cash accruals.
SBCF was set up in May 2012 as a partnership firm by Mr. Bharat
Goyal and Mr. Sandeep Goyal. The firm has a plant in Barwani
(Madhya Pradesh) for ginning and pressing of raw cotton into
cotton bales.
SOLWEDISH SOLAR: Weak Financial Strength Cues ICRA SP 3D Grading
----------------------------------------------------------------
ICRA has assigned 'SP3D' grading to Solwedish Solar Private
Limited, indicating 'Moderate Performance Capability' and 'Weak
Financial Strength' of the channel partner to undertake off-grid
solar projects. The grading is valid till Aug. 4, 2018, after
which it will be kept under surveillance.
Grading Drivers
Strengths
* More than 15 years of experience of the promoter in solar
Industry
* Satisfactory feedback from customers and suppliers
* Positive outlook and growth prospects for solar industry
assisted by favorable government policies
Risk Factors
* Small scale of operations in the solar industry with no
revenues booked for FY2015
* Weak financial profile characterized by high gearing of 20.00
times as on March 31, 2015
* Limited track record of the company in terms of solar thermal
installations with only 77.5 KW capacity installed till
March 2015
* Large number of organized and unorganized players indicating
high level of competition leading to pressure on margins
SI Related Business - Moderate Performance Capability
* Promoter Track Record: The CEO of the company Mr. Madan Mohan
Reddy has more than 15 years of experience in renewable energy
research, thermal designing, construction of solar collectors,
system integration, installation, commissioning, and testing
solar energy sources. He was also awarded as best innovator of
2014 under India Innovation Growth Program (IIGP) jointly held by
Dept. of Science & Technology (DST) and Lockheed Martin Corp for
innovation of low-cost solar dish system. Over the past 1 year,
SSPL has executed solar thermal dish installations totaling to a
capacity of over 77.5 KW with total value of INR0.47 crore. It
has orders under negotiations for solar thermal installations of
1850 KW amounting to INR12.8 crore.
* Technical competence and adequacy of manpower: SSPL has
provided thermal integration services for solar dish
installations. The company has its assembly unit in Hyderabad,
Telangana where the solar products are assembled and tested. The
company has a 6 member technical team for carrying out thermal
installations.
* Quality of suppliers and tie ups: SSPL has the capability to
undertake system integration activities in-house and relies on
local and reputed suppliers for machining components and other
raw materials. The company sources raw materials from reputed
suppliers and they have expressed satisfaction and positive
feedback on their association with the company.
* Customer and O&M Network: The clientele for SSPL comprises of
both commercial and government segments. The customers have
expressed satisfaction on the thermal services provided by the
company. Operation and maintenance is carried out through the
annual maintenance contracts agreed with the customer.
Financial Strength - Weak Financial Strength
Revenues
The company didn't reported any operating income during FY2015
owing to nascent stage of operations
Return on Capital Employed (RoCE)
Nil
Total Outside Liabilities / Tangible Net worth
TOL/TNW is high at 20 times as on March 31, 2015
Interest Coverage Ratio (ICR)
The company has no interest obligations for FY2015
Net-Worth
The company net-worth is INR0.01 crore and promoters net-worth is
INR2.35 crore as on March 31, 2015
Current Ratio
The company does not have any current liabilities for FY2015
Relationship with bankers
Bankers are satisfied with the company
The overall financial profile of the company is Weak.
SRI BALASUBRAMANIA: CRISIL Reaffirms B- Rating on INR59.4MM Loan
----------------------------------------------------------------
CRISIL's rating on the long-term bank facilities of Sri
Balasubramania Mills Limited continues to reflect the company's
modest scale of operations in the fragmented textile industry,
susceptibility of its operating margin to volatility in raw
material prices, and its below-average financial risk profile
because of weak debt protection metrics. These weaknesses are
partially offset by the extensive industry experience of its
promoters.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Cash Credit 59.4 CRISIL B-/Stable (Reaffirmed)
Proposed Long Term
Bank Loan Facility 10.6 CRISIL B-/Stable (Reaffirmed)
Outlook: Stable
CRISIL believes SBML will continue to benefit over the medium
term from its promoters' extensive industry experience. The
outlook may be revised to 'Positive' if improvement in the
company's revenue and profitability results in a considerably
stronger financial risk profile. The outlook may be revised to
'Negative' if decline in cash accrual, stretch in working capital
cycle, or large, debt-funded capital expenditure weakens its
financial risk profile.
SBML, incorporated in 1935, manufactures blended polyester cotton
yarn. Its daily operations are managed by Mr Sanjay Balu and Mr
Arjun Balu.
SRI LAKSHMI: CRISIL Lowers Rating on INR170MM LT Loan to 'B'
------------------------------------------------------------
CRISIL has downgraded its rating on the long-term bank facilities
of Sri Lakshmi Saraswathi Textiles (Arni) Limited to 'CRISIL
B/Stable' from 'CRISIL B+/Stable', and has reaffirmed its 'CRISIL
A4' rating on the company's short-term facility.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Bill Discounting 35 CRISIL A4 (Reaffirmed)
Cash Credit 50 CRISIL B/Stable (Downgraded
from 'CRISIL B+/Stable')
Letter of Credit 20 CRISIL A4 (Reaffirmed)
Packing Credit 20 CRISIL A4 (Reaffirmed)
Proposed Long Term 170 CRISIL B/Stable (Downgraded
Bank Loan Facility from 'CRISIL B+/Stable')
The downgrade reflects the decline in the company's operating
profitability and operating income. The operating income fell 5%
year-on-year in fiscal 2016, due to intense competition from
domestic players and imported yarn. The operating profitability
was negative during the fiscal primarily due to significant
decline in realizations and shortage of labor. SLST's
profitability is expected to remain under pressure over the
medium term due to continued labor crisis, subdued demand, and
volatility in cotton prices.
The ratings reflect SLST's below-average financial risk profile,
the susceptibility of its operating margin to volatility in raw
material prices, and its exposure to intense competition. These
weaknesses are partially offset by the company's established
track record and its promoters' extensive experience in the
cotton yarn industry.
Outlook: Stable
CRISIL believes SLST will continue to benefit from its promoters'
extensive experience and its established track record in the
cotton yarn industry. The outlook may be revised to 'Positive' if
there is a considerable increase in its revenue and
profitability, resulting in improved cash accrual and debt
protection metrics. The outlook may be revised to 'Negative' in
case of low cash accrual or large debt-funded capital
expenditure, impacting the company's financial risk profile,
particularly liquidity.
SLST was set up in 1964 by late Mr. B.Rajagopal, Naidu and his
son Late Mr.R.Srihari. The company has a spinning unit in Arni,
Thiruvanamalai (Tamil Nadu). The operations are managed by its
Managing Director, Mr. Balakrishna S and Joint Managing Director,
Mr. R.Padmanaban. The company is listed on the Bombay Stock
Exchange.
SLST had a net loss of INR39.9 million on revenue of INR1.1
billion for fiscal 2016, against a net loss of INR26.5 million on
revenue of INR1.15 billion for fiscal 2015. For the three months
through June 2016, it had a net loss of INR11.3 million on sales
of INR261.1 million, against a net profit and sales of INR3.83
million and INR288.4 million, respectively, for the corresponding
period of the previous year.
SRINIVASA CIVIL: Ind-Ra Suspends 'IND D' LT Issuer Rating
---------------------------------------------------------
India Ratings and Research (Ind-Ra) has migrated Srinivasa Civil
Works Private Limited's (SCWPL) '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 SCWPL.
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.
SCWPL's ratings:
-- Long-Term Issuer Rating: migrated to 'IND D(suspended)' from
'IND D'
-- INR210 million non-fund-based limits: migrated to short term
'IND D(suspended)' from 'IND D'
-- INR35 million fund-based limits: migrated to long term 'IND
D(suspended)' from 'IND D'
SUDAMA COTTON: CRISIL Reaffirms 'B' Rating on INR50MM Cash Loan
---------------------------------------------------------------
CRISIL's rating on the long-term bank facility of Sudama Cotton
Ginning and Processing Factory continues to reflect the firm's
small scale of operations in the intensely competitive cotton
ginning industry, and its weak financial risk profile because of
high total outside liabilities to tangible networth (TOLTNW)
ratio and weak debt protection measures. These weaknesses are
partially offset by its partners' extensive industry experience.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Cash Credit 50 CRISIL B/Stable (Reaffirmed)
Outlook: Stable
CRISIL believes SCG's scale of operations will remain small and
financial risk profile will remain weak over the medium term. The
outlook may be revised to 'Positive' if the firm scales up
operations and improves its financial risk profile. The outlook
may be revised to 'Negative' if its working capital debt
increases, or if it undertakes large, debt-funded capital
expenditure, or if its revenue and operating margin decline.
Update
SCG's revenue is estimated to have declined 15% to INR166.60
million in fiscal 2016 from INR194.60 million in fiscal 2015, due
to low cotton production because of drought in Maharashtra and
whitefly epidemic in Punjab. CRISIL expects the firm's revenue to
grow 20-25% over the medium term because of commencement of
mustard oil processing. The firm's operating margin remained at
3.74% in fiscal 2016. CRISIL expects the margin at 3.75-4.00%
over the medium term, supported by addition of a product (mustard
oil).
SCG's financial risk profile remained weak, because of estimated
small networth of INR11.30 million and high TOLTNW ratio of 4.38
times as on March 31, 2016, and weak debt protection metrics
indicated by interest coverage and net cash accrual to total debt
ratios of 1.2 times and 0.02 time, respectively, in fiscal 2016.
CRISIL believes the financial risk profile will remain weak over
the medium term due to low profitability restraining increase in
networth, and large working capital debt resulting in increase in
interest cost.
The firm's net cash accrual is estimated at INR1.90 million in
fiscal 2016, against no debt obligation. Its liquidity is
supported by unsecured loans of INR2.0 million from the partners
as on March 31, 2016, which will remain in the business over the
medium term. However, the liquidity is constrained by high bank
limits utilization, at an average of 99% over the 12 months
through April 2016. Its large working capital requirement is
reflected in gross current assets of 134 days as on March 31,
2016.
SCG was established by Mr Suresh Kumar and Mr Ashwini Kumar in
1987, and is based in Punjab. It manufactures cotton bales,
cotton seed oil, and cotton oil cakes. It sells cotton bales to
spinning mills and local traders in Punjab. Firm has already
started operation of Mustard oil processing in April, 2016.
SWAROOP AGRO: CRISIL Assigns B+ Rating to INR60MM Term Loan
-----------------------------------------------------------
CRISIL has assigned its 'CRISIL B+/Stable' rating to the long-
term bank facilities of Swaroop Agro Products Private Limited.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Term Loan 60 CRISIL B+/Stable
Cash Credit 50 CRISIL B+/Stable
Proposed Long Term
Bank Loan Facility 13 CRISIL B+/Stable
The rating reflects exposure to funding and implementation risks
associated with an ongoing project and to intense competition in
the fragmented edible oil industry. These weaknesses are
partially offset by the extensive industry experience of its
promoters.
Outlook: Stable
CRISIL believes SAPPL 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 substantial cash
flow leading to timely completion of the project and healthy cash
accrual. The outlook may be revised to 'Negative' in case of time
and cost overruns in the project, significant pressure on
liquidity, or decline in revenue and profitability, leading to
deterioration in debt servicing ability.
SAPPL, promoted by Mr. Satyendra Gupta and Ms. Indra Gupta and
incorporated in 2015, is setting up an edible oil extraction
plant. The proposed capacity of the plant is 350 tonne per day.
The plant is being set up at village Umran (Akbarpur), in the
Kanpur-Dehat district of Uttar Pradesh.
SWASH NONIONICS: CRISIL Reaffirms 'B' Rating on INR90MM LT Loan
---------------------------------------------------------------
CRISIL's ratings on the bank facilities of Swash Nonionics
Private Limited continue to reflect its modest scale of
operations in the highly competitive chemical products industry,
susceptibility of its margins to volatility in raw material
prices and working capital intensive nature of operations. These
rating weaknesses are partially offset by the extensive industry
experience of SNPL's promoters.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Cash Credit 35 CRISIL B/Stable (Reaffirmed)
Proposed Letter of
Credit 5 CRISIL A4 (Reaffirmed)
Proposed Long Term
Bank Loan Facility 90 CRISIL B/Stable (Reaffirmed)
Proposed Packing
Credit 20 CRISIL A4 (Reaffirmed)
Outlook: Stable
CRISIL believes that SNPL will continue to benefit over the
medium term from the extensive experience of its promoters in the
chemical products industry. The outlook may be revised to
'Positive' if the company substantially increases its scale of
operations while improving its profitability and capital
structure or there is an improvement in the working capital
management. Conversely, the outlook may be revised to 'Negative'
in case SNPL registers significant decline in its revenues or
margins, elongation of its working capital cycle or undertakes a
larger-than-expected debt-funded capital expenditure programme,
resulting in weakening of its financial risk profile.
SNPL was established in 1990 by Mr. Nimish Munim manufactures
surfactants and other specialty chemicals since. The company has
its manufacturing facility at Chiplun. The company caters to
industries including Textiles, Metal, Pesticides and Paints. The
day to day operations of the company are overseen by Mr. Yash
Munim, son of Mr. Nimish Munim. The Munim family has been in the
business of manufacturing surfactants since 1971 through Texchem
Industries a partnership firm setup by Mr. Nimish Munim.
SYRMA TECHNOLOGY: Ind-Ra Cuts LT Issuer Rating to 'IND BB+'
-----------------------------------------------------------
India Ratings and Research (Ind-Ra) has downgraded Syrma
Technology Private Limited's (Syrma) Long-Term Issuer Rating to
'IND BB+' from 'IND BBB-'. The Outlook is Stable.
KEY RATING DRIVERS
The downgrade reflects a sustained deterioration in Syrma's
credit profile since FYE14. The EBITDA margin declined to less
than half of FY14 levels to 1.4% in FY15 (FY14: 2.9%) on account
of increased proportion of revenue from trading. During FY16, as
the company shifted its focus to manufacturing, the profitability
normalised at 2.9% but the credit metrics continued to remain
stretched as compared to FYE14.
EBITDA interest cover (operating EBITDA/Gross interest expense)
deteriorated to 2.2x in FY16 (FY15: 2.8x; FY14: 4.0x) on account
of an increase in the use of fund-based facilities for trading
activities. Net leverage (total adjusted net debt/operating
EBITDA) was 4.3x in FY16 (FY15: 10.2x; FY14: 3.4x). The credit
metrics are likely to deteriorate further in FY17 with the debt-
funded capex of INR211 million for the installation of new
machinery for its Electronic Manufacturing Service.
In FY16, manufacturing and trading activities contributed 68% and
32% (FY15: 43% and 57%) to the total revenue respectively. FY16
revenue was flat at INR2.5 billion (FY15: 2.49bn as the company
focused on manufacturing and reduced trading activities to
bolster profitability. The company expects its top line to shrink
in FY17 due to the cessation of the low-margin trading
operations.
The company's liquidity is moderate with 87.2% average peak
utilisation of its fund-based facilities over the 12 months ended
June 2016.
The ratings continue to draw strength from Syrma's established
relationships with its customers as well as from the promoters'
established track record in the domestic electronics
manufacturing industry.
RATING SENSITIVITIES
Positive: A significant increase in scale and profitability,
leading to sustained improvement in credit metrics, would be
positive for the ratings
Negative: A decline in revenue or operating profitability,
resulting in a significant deterioration in credit metrics will
be negative for the ratings.
COMPANY PROFILE
Incorporated in the 2005, Syrma manufactures and exports coils,
coil sub-assemblies, tags, PCB assembly, memory modules and
transmission equipment.
Syrma's ratings:
-- Long-term Issuer Rating: downgraded to 'IND BB+' from 'IND
BBB-'; Outlook Stable
-- INR270.0 million fund-based working capital facilities:
downgraded to Long-term 'IND BB+'/Stable from 'IND BBB-
'/Stable and downgraded to Short-term 'IND A4+' from
'IND A3'
-- INR202.0 million non-fund-based working capital limits:
downgraded to Long-term 'IND BB+'/Stable from 'IND BBB-
'/Stable and downgraded to Short-term 'IND A4+' from
'IND A3'
-- INR30.4 million term loans (increased from INR27.5
million): downgraded to Long-term 'IND BB+'/Stable from
'IND BBB-'/Stable
TATA CHEMICALS: Fitch Says Business Sale to Boost Credit Profile
----------------------------------------------------------------
Fitch Ratings expects Tata Chemicals Limited's (TCL, BB+/Stable)
sale of its urea business to the Norwegian company, Yara
International ASA (Yara), to strengthen the Indian company's
financial profile. TCL's divestment of its low-margin urea
business is driven by the company's strategy to focus on the
higher-margin fertiliser and consumer products businesses, which
includes pulses and spices.
Yara, the world's largest urea manufacturer by output, agreed to
buy the business for USD400 million (INR26.70 billion) in cash.
Yara will also acquire as part of the transaction the urea
fertilizer subsidy receivables due from the government of India.
Consolidated fertilizer receivables stood at INR19.01 billion as
of March 31, 2016 (March 31, 2015: INR19.71 billion), of which
about a fourth of the fertilizer subsidies (INR4.70 billion) has
been delayed for more than six months.
The sizeable fertilizer subsidy outstanding lengthened TCL's
working capital cycle and contributed to its high financial
leverage (net adjusted debt / operating EBITDAR). TCL's financial
leverage of 3.44x at March 31, 2016 (end-March 2015: 3.40x) was
marginally lower than 3.50x, the level at which Fitch would have
considered negative rating action. However with the cash inflow
from the divestment and the transfer of fertilizer subsidy
receivables to Yara, TCL's pro forma financial leverage would
improve to around 2.5x.
The divestment of the low-margin urea business would improve
TCL's EBITDAR margin. According to Yara's announcement dated 10
August 2016, TCL's urea business registered an EBITDAR margin of
about 10% in the financial year to end-March 2016 (FY16) and
revenue of INR23.36 billion (13% of consolidated revenues). In
comparison, TCL's FY16 consolidated margin was 12.2% and revenue
was INR177.08 billion. Fitch expects TCL to use the divestment
proceeds to repay debt and to fund capex. Hence, consolidated
interest expenses would also decline from FY18 onwards.
TCL, a Tata group company in which the holding company Tata Sons
Limited (TSOL) and other group companies hold an aggregate stake
of 30.94%, says the divestment, subject to regulatory clearances,
will be completed within a year.
TATA MOTORS: S&P Raises CCR to 'BB+', Outlook Stable
----------------------------------------------------
S&P Global Ratings said that it had raised its long-term
corporate credit rating on India-based automotive company Tata
Motors Ltd. to 'BB+' from 'BB'. The outlook is stable. At the
same time, S&P raised the issue rating on Tata Motors' U.S.-
dollar-denominated senior unsecured notes to 'BB+' from 'BB'.
"We raised the rating to reflect the improvement in Tata Motors'
competitive position following the better performance of its 100%
subsidiary, Jaguar Land Rover Automotive PLC (JLR)," said S&P
Global Ratings credit analyst Mehul Sukkawala.
JLR has launched new models successfully, extended existing ones,
and expanded into new market segments. JLR also helped
strengthen Tata Motors' financial position and its ability to
withstand moderate volatility and the risks from the U.K.'s
recent vote to leave the E.U. (Brexit).
JLR has improved its product portfolio over the past two years
and S&P expects the company to maintain its strengthened
position. New and updated models are in the pipeline, including
a Range Rover Evoque convertible (launched in 2016) and a long-
wheel base version of the Jaguar XF in China. JLR's new models
launched over the past 15-18 months were well received in the
market. In addition, volume growth has been broad-based across
different regions, especially in 2016.
JLR's good operating performance has a significant bearing on
Tata Motors' overall operating performance. JLR accounts for
more than 90% of Tata Motors' EBITDA.
"JLR's improved competitive position will enable Tata Motors to
register good operating performance over the next two years in
the form of revenue growth and higher EBITDA margin," said
Mr. Sukkawala. "At the same time, Tata Motors' India operations
have recovered with the improving economic environment, cyclical
turnaround for commercial vehicles, and new product launches in
the passenger vehicle segment."
S&P believes Brexit does expose Tata Motors' operating
performance to some uncertainty because JLR has most of its
manufacturing operations in the U.K. and a sizable presence in
the domestic market. However, S&P believes Tata Motors' current
financial profile and rating can accommodate the uncertainty.
"Overall, we expect Tata Motors to maintain its current financial
position. The stronger operating performance will be offset by
its negative free operating cash flow due to high capital
expenditure in areas such as vehicle programs and new capacity,
especially at JLR. We believe the company's FFO-to-debt ratio
will remain at about 40% and debt-to-EBITDA ratio will be about
1.7x for the next two years, providing adequate buffer to
withstand any potential volatility from cyclicality and high
operating leverage of the sector. In our debt calculation for
Tata Motors, we exclude debt related to captive finance
operations and deduct 75% of cash and cash equivalents," S&P
said.
JLR's established and improving market position in the global
premium automotive segment with well-recognized brands and Tata
Motors' low-cost manufacturing capabilities in its Indian
commercial vehicle business support Tata Motors' business risk
profile. However, S&P views JLR's still-modest size, its limited
product range compared with larger global peers', and Tata
Motors' market position in Indian passenger car segments as
offsetting factors.
The stable outlook reflects S&P's view that Tata Motors can
maintain steady profitability, especially at JLR, supporting its
financial position with a ratio of FFO to debt of about 40% over
the next 12-24 months.
S&P may lower the rating if Tata Motors' operating performance
weakens and capital expenditure is high, resulting in a ratio of
FFO to debt remaining below 30% on a sustained basis. A weaker
operating performance could indicate lower-than-expected success
in new models or a challenging operating environment, such as
larger-than-expected adverse impact from Brexit.
S&P may raise its rating on Tata Motors if JLR's strong operating
performance partly offsets the increase in capital expenditure,
such that S&P expects Tata Motors to sustain its ratio of FFO to
debt above 45%. A further strengthening of JLR's product
portfolio could support its strong operating performance.
UNISEX AGENCIES: CRISIL Reaffirms B+ Rating on INR90MM Cash Loan
----------------------------------------------------------------
CRISIL's ratings on the bank facilities of Unisex Agencies
continue to reflect the firm's weak financial risk profile
because of high gearing, its large working capital requirement,
and small scale of operations in the branded garments
distribution industry. These weaknesses are partially offset by
its promoter's extensive industry experience and his financial
support, and its established relationships with its principals.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Bank Guarantee 40 CRISIL A4 (Reaffirmed)
Cash Credit 90 CRISIL B+/Stable (Reaffirmed)
Outlook: Stable
CRISIL believes Unisex will continue to benefit from its
established relationships with its key principals and its
promoter's extensive experience in the garments distribution
business. The outlook may be revised to 'Positive' if there is a
significant increase in its revenue or profitability, or
improvement in its working capital management, resulting in a
better financial risk profile. The outlook may be revised to
'Negative' in case of pressure on its revenue and profitability,
or stretch in its working capital cycle, or any large, debt-
funded capital expenditure.
Update
Unisex's operating income is estimated to have increased 10.5% to
INR419 million in fiscal 2016 from INR379 million in the previous
fiscal on account of the firm becoming a super stockist for
Adidas and Reebok in North India and repeat orders from existing
customers. Its operating margin is estimated at 4% for fiscal
2016, similar to the previous fiscal. The firm's large working
capital requirement is indicated by its gross current assets of
120-160 days in the three years through fiscal 2016, driven by
large inventory level. Its total outside liabilities to tangible
networth (TOLTNW) ratio is estimated at over 4 times as on March
31, 2016, because of modest networth of around INR15 million and
considerable working capital debt. CRISIL believes the firm's
financial risk profile will remain below average on account of
low accrual and high TOLTNW ratio. While the firm utilises its
bank limit extensively, it does not have any major term debt
obligation, and its liquidity is supported by unsecured loans
from its promoter. CRISIL believes the liquidity will remain
adequate over the medium term in the absence of any capex plan.
Unisex was set up by Mr Rohit Khanna as a proprietorship firm in
1994. It distributes products of brands such as Adidas, Jockey
sportswear, Pepe Jeans, Just for Kids, Fila, and Provogue in
Punjab, Haryana, Himachal Pradesh, and Jammu & Kashmir. The firm
also retails branded garments, and has 14 retail outlets in
Punjab.
UTKAL HEALTHCARE: CRISIL Assigns 'B' Rating to INR450MM Term Loan
-----------------------------------------------------------------
CRISIL has assigned its 'CRISIL B/Stable' rating to the long-term
bank facility of Utkal Healthcare Private Limited.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Term Loan 450 CRISIL B/Stable
The rating reflects the limited track record and modest scale of
operations from the existing unit and exposure to project
implementation risk, owing to the ongoing capital expenditure
(capex) for the upcoming multi-speciality unit at Bhubaneswar.
These weaknesses are partially offset by longstanding association
of promoters with the healthcare industry and a comfortable
financial risk profile, marked by moderate networth and above-
average debt protection metrics.
Outlook: Stable
CRISIL believes that UHPL will benefit from extensive experience
and specialization of promoters in treating cancer, orthopaedic
and heart diseases. The outlook may be revised to 'Positive' if
substantial and sustained growth in revenue and accrual, timely
completion of ongoing capex, and efficient working capital
management, strengthen the business and financial risk profiles.
The outlook may be revised to 'Negative' if lower-than- expected
revenue or profitability, or any time or cost overrun in the
proposed capex, weakens the financial risk profile, particularly
liquidity.
UHPL was incorporated in 2006 and is presently operating a
nuclear medicine diagnostic centre by installing the Gamma Camera
unit in 2008, under the name of 'Utkal Institute of Medical
Science'. Later, in September 2014, the organisation installed a
Positron Emission Tomography (PET) scan unit. Daily operations
are managed by Mr. Dr. Birendra Kishore Das and Mr. Sailendra
Narayan Panda.
VEESONS ENERGY: CRISIL Reaffirms 'D' Rating on INR360MM Loan
------------------------------------------------------------
CRISIL's ratings on the bank facilities of Veesons Energy Systems
Private Limited continue to reflect instances of delay by Veesons
in servicing its term debt and continuous overdrawals in the
working capital facility for more than 30 days owing to the
company's weak liquidity.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Bank Guarantee 140 CRISIL D (Reaffirmed)
Cash Credit 360 CRISIL D (Reaffirmed)
Letter of Credit 165 CRISIL D (Reaffirmed)
Proposed Long Term
Bank Loan Facility 38.3 CRISIL D (Reaffirmed)
Term Loan 302.3 CRISIL D (Reaffirmed)
Working Capital
Term Loan 80.0 CRISIL D (Reaffirmed)
Veesons also has a below-average financial risk profile marked by
a weak capital structure, along with its working-capital-
intensive operations. However, the company benefits from the
promoters' extensive industry experience and established customer
relationships.
Veesons commenced operations as a partnership firm in 1981 and
was reconstituted as a private limited company in 1994. The
company manufactures boilers and boiler components, besides
undertaking erection, procurement, and commissioning contracts to
set up boilers. Other services include conversion, modification,
and renovation of existing boilers.
VIKRANT ISPAT: Ind-Ra Assigns 'IND BB-' Long-Term Issuer Rating
---------------------------------------------------------------
India Ratings and Research (Ind-Ra) has assigned Vikrant Ispat
Udyog (VIU) a Long-Term Issuer Rating of 'IND BB-'. The Outlook
is Stable.
KEY RATING DRIVERS
The ratings reflect VIU's weak credit profile with narrow EBITDA
margins. In FY16, the company's net financial leverage (total
adjusted debt/operating EBITDAR) was 3.68x (FY15: 3.97x) and
gross interest coverage (operating EBITDA/gross interest expense)
was 1.44x (1.41x) with EBITDA margins of 1.5% (1.47%). FY16
numbers are provisional in nature.
The ratings are also constrained by VIU's presence in a highly
fragmented and intensely competitive iron and steel industry.
The ratings, however, are supported by around four decades of
experience of VIU's founders in the iron and steel trading
business as well as the company's 40 year-long operational
history and strong customer relationships. The ratings are
further supported by the company's moderate scale of operations
as revenue stood at INR2,100 million in FY16 (FY15: INR1,889
million).
The ratings factor in the company's tie-up with TATA Steel
Limited ('IND AA'/RWE) and its comfortable liquidity position as
reflected in around 88% average use of its working capital
facilities during the 12 months ended Jun 2016.
RATING SENSITIVITIES
Positive: A substantial improvement in the scale of operations,
along with an improvement in the EBITDA margins could result in a
positive rating action.
Negative: Any decline in the revenue growth or EBITDA margins
leading to deterioration in the credit metrics could result in a
negative rating action.
COMPANY PROFILE
Incorporated in 1976, VIU is a partnership firm engaged in the
dealership of Tata Steel Limited's products. VIU is promoted by
Mr. Bhupinder Kumar Bansal and Mr. Pramod Kumar Singhal. The key
products offered by the firm includes TMT bars, wires, pipes,
angles, steel bar, steel angles, coils and plates.
VIU's ratings:
-- Long-Term Issuer Rating: assigned 'IND BB-'/Stable
-- INR145 million fund-based limits: assigned
'IND BB-'/Stable/'IND A4+'
-- INR20 million non-fund-based limits: assigned 'IND A4+'
=================
I N D O N E S I A
=================
MASKAPAI REASURANSI: Fitch Affirms 'BB' International IFS Rating
----------------------------------------------------------------
Fitch Ratings Indonesia has affirmed PT Maskapai Reasuransi
Indonesia Tbk's (Marein) National Insurer Financial Strength
(IFS) Rating of 'A+(idn)'. Fitch Ratings has also affirmed the
company's international IFS Rating of 'BB'. The Outlooks are
Stable.
'A' National IFS Ratings denote a strong capacity to meet
policyholder obligations relative to all other obligations or
issuers in the same country, across all industries and obligation
types. However, changes in circumstances or economic conditions
may affect the capacity for payment of policyholder obligations
to a greater degree than for financial commitments denoted by a
higher rated category.
KEY RATING DRIVERS
The rating affirmation reflects Marein's high business
concentration in catastrophe-prone Indonesia, its modest market
position and small asset size compared with some of its local and
regional peers, despite its long operating record. The rating
also considers Marein's conservative investment portfolio, strong
capitalization and sound operating performance.
Marein's market share was around 12% in 2015, as measured by
total industry gross written premiums (GWP). The company remains
focused on sound bottom-line performance through prudent
underwriting rather than mere top-line growth, despite
regulations introduced in 2014 encouraging cedants to optimize
local reinsurance capacity. More than 70% of its GWP were derived
from the life reinsurance business in 2015. Fitch believes Marein
would benefit from expanding its non-life business to lower
concentration risk by reducing reliance on the life segment and
strengthening its overall market position in Indonesia's
reinsurance market.
The reinsurer's investment portfolio remained prudent and liquid
in 2015, with cash and cash equivalents representing around 60%
of total invested assets. Marein's exposure to risky assets, such
as equities, is manageable relative to its capitalization.
However, some of its cash and deposits were placed with banks
rated below investment-grade in 2015. Fitch does not expect
Marein's investment mix to deviate significantly in the near
term.
Ongoing surplus growth continued to support Marein's strong
capital profile in 2015. The company's capitalization, measured
by the regulatory risk-based capital ratio, improved to 296% in
2015, from 230% in 2014, well-above the 120% minimum statutory
requirement.
The reinsurer's operating performance remained healthy in 2015,
backed by steady premium growth, stable investment returns and
manageable underwriting expenses. Its bottom-line profitability,
measured by ROE, was 24% in 2015, well within the median
guidelines for its rating category. Marein's non-life
underwriting margin, measured by its combined ratio, was stable
at below 100%. Fitch expects the reinsurer to carefully manage
its catastrophe risk exposure to minimize volatility in its
underwriting performance, considering its small book of non-life
business.
The Stable Outlook reflects Fitch's expectation that Marein will
maintain sufficient capital buffers and prudent underwriting
practices to support its operation and business expansion.
RATING SENSITIVITIES
Key rating triggers for a downgrade include significant
deterioration in operating performance, with a combined ratio
consistently higher than 100%, and weakening capitalisation, with
the local statutory ratio below 180% on a sustained basis.
Material deterioration in market franchise could also lead to a
rating downgrade.
Key rating triggers for an upgrade include enhanced fundamentals,
such as a strengthened market franchise and successful
diversification to a more balanced business portfolio, while
maintaining healthy operating performance and capitalisation.
====================
N E W Z E A L A N D
====================
TAHA ASIA: Gore District Council Listed as Unsecured Creditor
-------------------------------------------------------------
Rachael Kelly at Stuff.co.nz reports that the Gore District
Council and Environment Southland are listed as unsecured
creditors in the liquidator's first report in the Taha Asia
Pacific Limited's case.
Stuff.co.nz relates that ES said it is owed NZ$175 for a consent
administration charge, and the Gore District Council does not
know why it is listed.
Taha Asia Pacific Limited was placed into liquidation on August 2
after its five year contract to process dross at the New Zealand
Aluminium Smelter's Tiwai Point plant expired and was not
renewed, Stuff.co.nz discloses.
Twenty-one employees of the company are listed as preferential
creditors and there are 42 unsecured creditors, including the two
councils, says Stuff.co.nz.
The council said its chief financial controller, Luke Blackbeard,
confirmed that the company does not owe the council any money.
According to Stuff.co.nz, liquidator Rhys Logan said EY legally
had five days to prepare the first liquidator's report and the
list of creditors came from Taha Asia Pacific Limited's financial
statements dated June 30.
"We just put in the last set of creditors from the last
statements. If they were owed money it may have been paid since
then," the report quotes Mr. Logan as saying. "What usually
happens is they contact us and tell us whether they are owed
money and what it is for and we work from there."
Stuff.co.nz relates that Mr. Logan said he and Rhys Cain, who had
been appointed liquidators, were making "good progress" in
dealing with the company's liquidation.
"We remain cautiously optimistic. We've been making good solid
progress with the key issues. It's not going to be a quick solve
but we're pleased with how it's going so far."
He would not comment on what would happen to the ouvea premix the
company was storing at the Mataura paper mill when it went into
liquidation, Stuff.co.nz notes.
The liquidator's report said the stored dross was a "significant
issue" for the liquidators and they are gathering as much
information as they can regarding the storage sites, according to
Stuff.co.nz.
A party has expressed an interest in acquiring the dross from the
liquidators but discussions are in the early stage, Stuff.co.nz
adds.
*********
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.
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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 ***