/raid1/www/Hosts/bankrupt/TCRAP_Public/170210.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
Friday, February 10, 2017, Vol. 20, No. 30
Headlines
A U S T R A L I A
BATIR PTY: Subcontractors Unlikely to Recoup Project Payment
CUDECO LTD: Calls for Shareholder Support as it Moves to End Debt
LIFESPAN PSYCHOLOGY: First Creditors' Meeting Set for Feb. 16
MANAGEMENT RESOURCE: First Creditors' Meeting Set for Feb. 17
MELBOURNE PLUMBING: First Creditors' Meeting Set for Feb. 17
WASTECH FIELD: First Creditors' Meeting Set for Feb. 17
C H I N A
FUTURE LAND: Fitch Assigns BB-(EXP) Rating to US$ Senior Notes
I N D I A
ACE AUTOCARS: CRISIL Lowers Rating on INR8MM E-DFS to B-
ANAND ELECTRICALS: CRISIL Assigns 'B' Rating to INR10MM LT Loan
ANJALI INFRACRETE: ICRA Reaffirms B Rating on INR5.4cr Loan
G V PRATAP: CRISIL Reaffirms B+ Rating on INR4MM LT Loan
GLOBAL OFFSHORE: CARE Lowers Rating on INR380.49cr Loan to 'D'
GUPTA OVERSEAS: CARE Reaffirms B Rating on INR9.28cr LT Loan
HERCULES AUTOMOBILES: Ind-Ra Assigns 'B+' Long-Term Issuer Rating
INDERA GARMENTS: Ind-Ra Assigns 'BB-' Long-Term Issuer Rating
JADWET RESORTS: CRISIL Reaffirms 'B' Rating on INR10MM LT Loan
JP RICE: CRISIL Assigns B+ Rating to INR8MM Cash Loan
KELTRON COMPONENT: ICRA Reaffirms B- Rating on INR11.25cr Loan
KGPS MECHANICAL: CRISIL Assigns 'B' Rating to INR5.24MM Loan
LAHOTY BROTHERS: Ind-Ra Affirms 'BB+' Long-Term Issuer Rating
LORD BALAJI: Ind-Ra Assigns 'D' Long-Term Issuer Rating
MALNADY TEA: Ind-Ra Assigns 'BB+' Long-Term Issuer Rating
MANGLAM PAPER: Ind-Ra Assigns 'BB-' Long-Term Issuer Rating
MARBILANO TILES: ICRA Assigns 'B' Rating to INR19cr Loan
MOMAI FOODS: CARE Assigns B+ Rating to INR9.86cr Long Term Loan
MV AGRO: ICRA Revises Rating on INR11.50cr Loan to B-
OZONE DIAMONDS: Ind-Ra Assigns 'BB-' Long-Term Issuer Rating
PARINEE SHELTERS: CRISIL Lowers Rating on INR81MM NCDs to D
PINAKEE ENGINEERS: Ind-Ra Affirms 'B+' Long-Term Issuer Rating
PRICE & BUCKLAND: Ind-Ra Assigns 'B+' Long-Term Issuer Rating
RAJSHRI IRON: Ind-Ra Lowers Long-Term Issuer Rating to 'B'
RHEOPLAST TECHNOLOGY: CRISIL Lowers Rating on INR7MM Loan to B
RIBBEL INTERNATIONAL: Ind-Ra Assigns BB- Long-Term Issuer Rating
SAGAR METALLICS: Ind-Ra Affirms 'BB-' Long-Term Issuer Rating
SAKTHI TRADERS: Ind-Ra Assigns 'B' Long-Term Issuer Rating
SAMRUDDHA RESOURCES: ICRA Ups Rating on INR25cr Loan to B-
SARITA FORGINGS: Ind-Ra Assigns 'B+' Long-Term Issuer Rating
SESHSAYI FOODS: Ind-Ra Raises Long-Term Issuer Rating to 'BB+'
SHREE LAXMI: CARE Raises Rating on INR2.85cr Loan from B+
SK AGARWAL: Ind-Ra Assigns 'BB' Long-Term Issuer Rating
SPECIALITY POLYMERS: CARE Downgrades Rating on INR45cr Loan to D
SREE PARIMALA: CARE Reaffirms B Rating on INR6.25cr LT Bank Loan
STOLT RAIL: CRISIL Reaffirms B+ Rating on INR9.2MM LT Loan
TECHNO TRAK: Ind-Ra Lowers Long-Term Issuer Rating to 'B+'
TIRUPATI STARCH: Ind-Ra Assigns 'BB' Long-Term Issuer Rating
UNIJULES LIFE: CRISIL Reaffirms D Rating on INR124.5MM Cash Loan
N E W Z E A L A N D
WINDFLOW TECHNOLOGY: Chief Financial Officer Steps Down
WYNYARD GROUP: Placed Into Liquidation
P H I L I P P I N E S
CHINA BANKING: Fitch Affirms IDRs at BB+; Outlook Stable
DEVELOPMENT BANK: Fitch Affirms LT IDR at BB+; Outlook Positive
S O U T H K O R E A
KOREAN AIR: Near-1,000% Debt Level to Worsen as Won Seen Weak
KOREAN AIR: Posts KRW556.8 Billion Net Loss in 2016
KUMHO TIRE: Q4 Net Loss Narrows to KRW5.3 Billion
SK HYNIX: Moody's Says Bid for Toshiba Memory Business Credit Neg
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A U S T R A L I A
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BATIR PTY: Subcontractors Unlikely to Recoup Project Payment
------------------------------------------------------------
Paul Weston at Gold Coast Bulletin reports that the majority of
Gold Coast subbies on several public housing projects are
unlikely to get their money back after a contracting company
collapsed owing more than AUD2 million, according to insurers.
A report to creditors on Batir Pty Ltd shows the Brisbane-based
company owes AUD2,174,789 with AUD1.98 million in debt spread
across 167 unsecured creditors, the Bulletin relates.
The Bulletin says some fence and haulage subbies are owed more
than AUD100,000 but much of the debt is shared between
plasterers, concreters and landscape suppliers from Yatala south
to Chinderah across the Tweed border.
While the amount of money owed is less than the Cullen Group
collapse at the Robina Boheme site where total debts are tipped
to reach AUD30 million, many subbies worked on both projects,
leaving them facing a financial crisis in the New Year.
According to the Bulletin, liquidator Thomas Dawson has
identified Batir Pty Ltd had AUD1.6 million in assets but a large
chunk of that money should be distributed among preferential
creditors and pay for the liquidation.
Acquire Trade Creditor business development manager Nathan
Wrobel, who is working with insured subbies, doubts those without
insurance protection will emerge financially unscathed by the
liquidation, the Bulletin says.
"With that amount of assets I think not many of the uninsured
creditors will be paid," Mr. Wrobel told the Bulletin.
"Contractors with Trade Credit policies can be reimbursed up to
90 per cent of their loss with insurers. There are only a handful
of clients who are insured."
The Bulletin notes that government tender documents revealed that
Batir had at least nine government contracts last year valued at
almost AUD6.4 million, including social housing projects at
Burleigh, Tugun and Labrador.
The State Opposition has questioned the due diligence undertaken
by the Government on the company but National Creditor Insurance
debtor documents obtained by the Bulletin give no hint that Batir
was failing to pay its bills last year.
Subbies, lawyers and consumer watchers say the reason for the
company's financial failure remains a mystery, the Bulletin adds.
CUDECO LTD: Calls for Shareholder Support as it Moves to End Debt
-----------------------------------------------------------------
Jenny Rogers at Gold Coast Bulletin reports that CuDeco has moved
to allay shareholder concern about its finances and management.
Shares in the copper miner fell more than 8 per cent on Feb. 2
after CuDeco revealed it is looking at funding opportunities to
get through a tough period.
The Bulletin relates that the company also said it is working to
pay off its debt to a Chinese bank.
According to the report, CuDeco told shareholders that it is
working through a number of options to service the repayment of a
AUD15-million debt to China's Minsheng Bank, due in March this
year.
CuDeco said that preliminary discussions are under way with the
bank, the Bulletin says.
The Bulletin adds that the board also is "reviewing options" for
future funding opportunities during this "challenging" period, it
said.
The Bulletin says the company, which has a large number of Gold
Coasters on its share register, reiterated it is confident in
securing the necessary financial support to ensure the success of
its flagship Rocklands copper mine, near Cloncurry.
CuDeco said the project is on track to achieve its 2017
production targets by April, the report notes.
It said more than AUD20-million in cash had already been received
from copper shipments.
According to the report, the company said two shipments scheduled
for January have been slightly delayed, with further shipments
set for early February and copper concentrate due for departure
in the first week of March.
The Bulletin meanwhile reports that CuDeco last week revealed its
general manager, mining executive Dr Dianmin Chen, had resigned
after less than a year in the job.
No reason has been given for his resignation.
CuDeco's general manager operations, Mark Roberts, also has
resigned, says the Bulletin. His last working day is February 17.
About CuDeco
CuDeco Limited -- http://www.cudeco.com.au/-- explores and
evaluates mineral properties in Australia. The company explores
for copper, cobalt, and gold deposits. It primarily owns a 100%
interest in the Rocklands Group copper project located in
Cloncurry, Queensland, Australia. The company was formerly known
as Australian Mining Investments Ltd. CuDeco Limited is
headquartered in Southport, Australia.
LIFESPAN PSYCHOLOGY: First Creditors' Meeting Set for Feb. 16
-------------------------------------------------------------
A first meeting of the creditors in the proceedings of Lifespan
Psychology Pty Ltd will be held at the offices of David Clout &
Associates, 105A Bowen Street, in Spring Hill, Queensland, on
Feb. 16, 2017, at 11:00 a.m.
David Clout and Patricia Talty of David Clout & Associates were
appointed as administrators of Lifespan Psychology on Feb. 7,
2017.
MANAGEMENT RESOURCE: First Creditors' Meeting Set for Feb. 17
------------------------------------------------------------
A first meeting of the creditors in the proceedings of Management
Resource Solutions Pty Ltd will be held at the offices of FTI
Consulting, 22 Market Street, in Brisbane, Queensland, on
Feb. 17, 2017, at 10:00 a.m.
Kelly-Anne Trenfield and John Richard Park of FTI Consulting were
appointed as administrators of Management Resource on Feb. 7,
2017.
MELBOURNE PLUMBING: First Creditors' Meeting Set for Feb. 17
------------------------------------------------------------
A first meeting of the creditors in the proceedings of Melbourne
Plumbing & Drainage Services VIC Pty Ltd will be held at the
offices of Hall Chadwick Chartered Accountants, Level 10, 575
Bourke Street, in Melbourne, Victoria, on Feb. 17, 2017, at 4:00
p.m.
Steven Gladman and David Ross of Hall Chadwick Chartered
Accountants were appointed as administrators of Melbourne
Plumbing on Feb. 7, 2017.
WASTECH FIELD: First Creditors' Meeting Set for Feb. 17
-------------------------------------------------------
A first meeting of the creditors in the proceedings of
Wastech Field Service Pty Ltd will be held at the Chartered
Accountants Australia New Zealand, Level 3, 600 Bourke Street, in
Melbourne, Victoria, on Feb. 17, 2017, at 11:00 a.m.
Nicholas John Martin and Rodney James Slattery of PPB Advisory
were appointed as administrators of Wastech Field on Feb. 7,
2017.
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C H I N A
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FUTURE LAND: Fitch Assigns BB-(EXP) Rating to US$ Senior Notes
--------------------------------------------------------------
Fitch Ratings has assigned China-based Future Land Development
Holdings Limited's (Future Land; 'BB-'/Positive) US dollar senior
notes a 'BB-(EXP)' expected rating. The notes are rated at the
same level as Future Land's senior unsecured rating because they
constitute direct and senior unsecured obligations of the
company.
The final rating of the notes is subject to the receipt of final
documentations conforming to information already received. Future
Land says it intends to use the net proceeds from the note issue
for general corporate purposes.
KEY RATING DRIVERS
Strategic Positioning: The Positive Outlook reflects Fitch's view
of Future Land's strategic position in the Yangtze River Delta
region. Its positioning continues to support its scale, which
compares well against 'BB' rated peers. Future Land's recent
aggressive land banking, if not supported by continued expansion
in its scale, could put pressure on its leverage. This is,
however, mitigated by its strong sales turnover, as measured by
contracted sales/gross debt, which was 1.8x at 1H16 and averaged
at 1.5x annually since 2010. This demonstrated the company's
ability to rapidly generate sales from new land acquisitions.
Fitch estimates Future Land's recurring EBITDA/interest expense
will remain 0.15x-0.2x over the next three years as it starts to
expand its shopping mall portfolio, which also supports the
rating.
Critical Scale Achieved: Future Land recorded exceptionally
strong presales in 2016, driven by better sell-through rates on
projects located in Tier 3 and Tier 4 cities, as well as a higher
average selling price (ASP) in the Yangtze River Delta.
Consolidated gross floor area sold in 2016 increased 45% yoy to
4.7 million square metres (sq m) and the ASP increased 13% yoy to
CNY10,121 per sq m. Fitch expects Future Land to maintain
consolidated contracted sales of more than CNY40bn per year.
Leverage May Pressure Rating: Future Land increased its land
purchases in 2H16, after a slow 1H16, with full-year attributable
land premiums reaching CNY47bn; representing 72% of total
presales of CNY65bn (including presales from joint ventures).
Future Land has been sourcing JV partners to share costs for the
more expensive land sites it bought in Shanghai, Nanjing and
Suzhou. Its aggressive land acquisitions in 2016 are likely to
lead to a temporary spike in leverage to 45%-50% by end-2016,
from 42% at end-1H16 and 33% at end-2015. The company intends to
reduce land purchases in 2017 due to the government's tightening
policies for the property market. Fitch will continue to monitor
the company's ability to deleverage while maintaining its scale.
Fair Land Bank Quality: Future Land has sufficient land bank for
development activity over the next three to four years, with the
attributable land bank held by its subsidiary Future Holdings at
21 million sq m in 1H16. The company has improved its
diversification, reducing the percentage of its land bank located
in the Yangtze River Delta to around 75% in 1H16, from around 91%
in 2013. It expects to reduce the proportion of its land in the
Yangtze River Delta to around 65%-70% and expand into the Pearl
River Delta region, Central and West China as well as the Bohai
Economic Rim. Only 44% of Future Holdings' land bank was located
in Tier 1 (Shanghai) and Tier 2 cities (Suzhou, Nanjing and
Hangzhou) at end-1H16, with the rest located mainly in the Tier 3
and 4 cities in Jiangsu and Zhejiang provinces.
Improving Margins: Fitch expects Future Land's gross margins to
remain around 23%-24% and the EBITDA margin to improve to 18%-19%
in 2016, from 16.1% in 2015, due to the rising ASP in the Yangtze
River Delta since 2H15. Future Land's EBITDA margin is low
relative to its 'BB' category peers, as its rapid turnover (which
is the highest among 'BB-' rated peers) sacrifices profitability
for faster returns for its investment.
Margin improvement from 2017 will depend on the rise in the ASP,
as it has recently acquired more expensive lands. The average
cost of land acquired in 3Q16 increased to CNY6,096/sq m in 1H16,
from CNY4,074/sq m; this includes three sites where homebuilders
paid record-breaking prices - one plot in Shanghai Hongkou that
cost CNY67,000/sq m and two plots in Nanjing Jiangning that cost
CNY20,000-22,000/sq m. The average cost of land acquired in 4Q16
moderated to CNY3,575/sq m as Future Land diversified its land
bank acquisition to other cities such as Hefei, Taizhou and
Changshu where land costs are lower than the Yangtze River Delta
region.
Structural Subordination Mitigated: Its subsidiary Future
Holdings, which is listed in Shanghai, remains a crucial platform
for Future Land's offshore financing, especially as the onshore
financing environment tightens in 2H16. Future Land has extended
a shareholder loan to Future Holdings to ensure sufficient
liquidity at the holding company level in the medium term. The
loan ranks equally with Future Holdings' onshore senior unsecured
debt and can be repaid upon Future Land's demand. Future Land's
CNY2.8bn shareholder loan to the subsidiary and CNY11.1bn in
unrestricted cash provides a sufficient source of liquidity to
cover Future Land's CNY4bn outstanding offshore debt as of end-
1H16. The ratio of the shareholder loan to the holding company's
net debt was over 0.8x at end-1H16. Fitch will continue to
monitor the ratio and expect coverage to increase after Future
Land accumulates interest and dividends from Future Holdings.
KEY ASSUMPTIONS
Fitch's key assumptions within the rating case for the issuer
include:
- contracted sales to grow 8%-10% in 2017-2018
- gross margins to improve to 23%-24% in 2016-2017
- land acquisition to slow 2017
- Future Land maintaining a controlling shareholding in A-share
Listco
- the ratio of the shareholder loan extended to Future Holdings
and JV interest to the holding company's net debt to be higher
than 0.7x.
RATING SENSITIVITIES
Positive: developments that may, individually or collectively,
lead to positive rating action include:
- contracted sales, excluding JVs, to remain above CNY40bn
- contracted sales/total debt sustained above 1.5x
- consolidated net debt/adjusted inventory sustained below 40%
- EBITDA margin sustained above 18%.
- the ratio of shareholder loan extended to Future Holdings and
JV interest to the holding company's net debt falling to lower
than 0.7x, with no significant decrease in Future Land's
shareholding in the Shanghai-listed subsidiary
Negative: failure to maintain the positive guidelines will lead
to the Outlook being revised to Stable from Positive.
LIQUIDITY
Sufficient Liquidity: Fitch expects Future Land to maintain
sufficient liquidity, with available cash of CNY11.2bn and
unutilised credit facilities (uncommitted) of CNY34bn at end-June
2016 to cover repayments on its short-term debt of CNY4.2bn and
Fitch-estimated 2016 outstanding land premium of CNY20bn.
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I N D I A
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ACE AUTOCARS: CRISIL Lowers Rating on INR8MM E-DFS to B-
--------------------------------------------------------
CRISIL has downgraded its rating on the long-term bank facilities
of ACE Autocars Private Limited to 'CRISIL B-/Stable' from
'CRISIL B+/Stable'.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Electronic Dealer 8 CRISIL B-/Stable (Downgraded
Financing Scheme from 'CRISIL B+/Stable')
(e-DFS)
Proposed Fund-Based 2 CRISIL B-/Stable (Downgraded
Bank Limits from 'CRISIL B+/Stable')
The downgrade reflects deterioration in business and financial
risk profiles on account of considerable decline in revenue and
operating profitability, resulting in cash losses.
Operating income declined to INR33.80 crore in fiscal 2016 from
INR44.49 crore in fiscal 2015 due to fall in demand for Tata
Motors Ltd's (TML's) passenger vehicles. Operating margin too
dipped to 1.9% from 5% on account of lower volume sales of cars
and hence weak absorption of overheads; and heavy discounts
offered to maintain scale of operations. Weakening profitability
and high interest cost resulted in cash losses of INR1.24 crore
in fiscal 2016.
The downgrade also factors in the decline in networth to INR4.30
crore as on March 31, 2016, from INR6.22 crore in the previous
year, resulting in weakening of total outside liabilities to
tangible networth (TOLTNW) ratio to 3.24 times from 3.04 times.
Debt protection metrics also reduced, with interest coverage and
negative net cash accrual to total debt ratios of 0.3 time and
0.11 time, respectively, for fiscal 2016, against 1.1 times and
0.04 time, respectively, for 2015.
Key Rating Drivers & Detailed Description
Weaknesses
*Modest scale of operations and weak profitability: Revenue was
INR33.80 crore in fiscal 2016 and operating margin 1.9%.
*Below-average financial risk profile: Decline in networth in
fiscal 2016 further weakened TOLTNW ratio.
Strength
* Extensive experience of promoters and established relationship
with customers and principal: Presence of around 15 years in the
automobile dealership segment has enabled the promoters to
establish strong relationship with customers and principal, TML.
Outlook: Stable
CRISIL believes AAPL will continue to maintain its established
position in the automobile dealership market in Cuttack over the
medium term, supported by the extensive experience of its
promoters. The outlook may be revised to 'Positive' if revenue
increases significantly and capital structure and liquidity
improve. The outlook may be revised to 'Negative' if financial
risk profile weakens further due to reduced operating margin,
weaker debt protection metrics, or any large, debt-funded capital
expenditure.
Set up in 2008 by Mr. Dharmaditya Pattanaik, his wife, Ms.
Sanjana Sanghamitra Das, and Mr. Divyaloka Pattanaik, AAPL is an
exclusive dealer of TML's passenger cars and has a showroom-cum-
workshop near Cuttack.
In fiscal 2016, net loss was INR1.92 crore on an operating income
of INR33.80 crore, against a net profit of INR0.01 crore on an
operating income of INR44.49 crore in fiscal 2015.
ANAND ELECTRICALS: CRISIL Assigns 'B' Rating to INR10MM LT Loan
---------------------------------------------------------------
CRISIL has assigned its 'CRISIL B/Stable/CRISIL A4' ratings to
the bank facilities of Anand Electricals.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Proposed Long Term
Bank Loan Facility 10 CRISIL B/Stable
Letter of Credit 2 CRISIL A4
Bank Guarantee 1 CRISIL A4
Cash Credit 2 CRISIL B/Stable
The ratings reflect AE's modest scale and working capital
intensive operations in the highly competitive electrical
engineering, procurement and construction (EPC) industry. The
ratings also factor in a below-average financial risk profile,
with a weak capital structure and debt protection metrics. These
weaknesses are partially offset by the extensive experience of
proprietor in the EPC industry.
Analytical Approach
CRISIL has treated the unsecured loan from promoters of INR0.21
crore as on March, 2016 as neither debt nor equity as it is
expected to remain in the business over the medium term.
Key Rating Drivers & Detailed Description
Weaknesses
* Modest scale of operations: Scale is small as indicated by
modest revenue of INR3 crore in fiscal 2016. While scale is
expected to improve substantially during fiscal 2017 supported by
healthy order-book, moderate scale would continue to constrain
the business risk profile over the medium term.
* Below-average financial risk profile: The financial risk
profile is weak, given subdued debt protection metrics, with low
interest coverage ratio of 1.3 times in fiscal 2016. Also, the
weak capital structure is reflected in high gearing of 10 times
as on March 31, 2016.
* Large working capital requirement: Operations are working
capital intensive as indicated by high gross current assets of
448 days as on March 31, 2016. This is primarily on account of
high inventory of 300 days and debtors of about 137 days.
Strength
* Extensive experience of proprietor in the foam industry: AE
benefits from its proprietor's experience of over 40 years in the
foam industry. Over the years, the management has established
longstanding relationships with customers and suppliers.
Outlook: Stable
CRISIL believes AE will continue to benefit over the medium term
from the proprietor's industry experience. The outlook may be
revised to 'Positive' in case of an increase in scale of
operations and profitability while improving working capital
management, leading to a better financial risk profile. The
outlook may be revised to 'Negative' in case of a decline in cash
accrual, weakening of working capital management leading to
stretched liquidity, or large, debt-funded capital expenditure,
deteriorating the financial risk profile.
Formed in 2005 as a proprietorship firm by Mr Ramakrishna Vetal,
AE, an EPC contractor, undertakes projects to set up transmission
lines and towers for public and private entities.
Profit after tax was INR10 lakhs crore on net sales of INR3.0
crore in fiscal 2016, against profit after tax of INR13.9 lakhs
on net sales of INR4.4 crore in fiscal 2015
ANJALI INFRACRETE: ICRA Reaffirms B Rating on INR5.4cr Loan
-----------------------------------------------------------
ICRA has reaffirmed the long-term rating outstanding on the
INR10.00-crore bank facilities of Anjali Infracrete Private
Limited at [ICRA]B. The outlook on the long-term rating is
stable.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Cash Credit 3.50 [ICRA]B (Stable) reaffirmed
Term Loans 5.40 [ICRA]B (Stable) reaffirmed
Unallocated Limits 1.10 [ICRA]B (Stable) assigned
Rationale
The rating continues to remain constrained by the company's small
scale of operations and its limited track record in the AAC
blocks industry. The rating is also constrained by the weak
financial risk profile, characterised by stretched capital
structure, weak debt-protection metrics and high working capital
owing to high debtor and inventory days. ICRA also takes note of
the highly competitive AAC block manufacturing industry given the
moderate technical and capital needed for manufacturing AAC
blocks. The rating, however, favorably considers the locational
advantage of the company on account of its proximity to major
consumption centres (Surat and Mumbai) and raw material sources.
The company's operating income is expected to grow at a healthy
rate on the back of additional demand expected from dealers
appointed in the current fiscal. The change is the AAC block
manufacturing mix (higher lime-based mix) is expected to result
in high raw material cost; however, the reduced autoclaving cycle
is expected to result in higher production, and thereby the
overall profitability is expected to remain in line with the
previous fiscals. The ability of the company to scale up the
operations as well as manage its working capital cycle
efficiently, so as to maintain its profitability and return
indicator, remains crucial from the credit perspective.
Key Rating Drivers
Credit Strengths
* Proximity to major consumption centres as well as to various
raw material sources
Credit Weaknesses
* Small scale of operations and limited track record in the AAC
block manufacturing industry
* High working capital intensity due to elongated debtor days
and high inventory
* Stretched capital structure and weak debt-protection metrics
owing to debt-funded capex
* High competition in the organised AAC blocks manufacturing
sector
Anjali Infracrete Private Limited commenced operations in
February 2016 with an installed capacity to produce 100,000 cubic
metres of AAC blocks annually. Post commissioning of the plant in
FY2014, the capacity utilisation has remained decent and improved
marginally to 66% in FY2016 from 60% in FY2015. The production
picked up in the current fiscal, with 107% utilisation in the 6M
FY2017 mainly owing to increased demand from the Mumbai region.
The company has modified its AAC block manufacturing mix, which
has resulted in lower autoclaving time and higher production
capacity. The company has decreased its sales prices from
September 2015 onwards because of the fall in raw material prices
coupled with changes in AAC block mix. Till FY2016, the company
was selling directly to builders based in Surat and Mumbai.
However; in the current fiscal, the company has appointed 10
dealers in the Mumbai thereby increasing the sales in the current
fiscal. The top 10 customers contributed around 26% and 44% in
FY2016 and 6M FY2017 respectively, and hence the customer
concentration risk is limited. The major raw materials, such as
fly-ash, cement, lime and aluminum powder, required for
manufacturing of AAC blocks are procured locally.
Analytical approach:
For arriving at the ratings, ICRA has considered the business and
the financial risk profiles of Anjali Infracrete Private Limited.
Surat-based Anjali Infracrete Private Limited was incorporated in
October 2009 by the Radadiya family. The company manufactures
autoclaved aerated concrete (AAC) blocks and has its
manufacturing unit in Dhamrol near Surat (Gujarat). The plant was
commissioned in February 2014 and has an installed capacity to
produce 1,00,000 cubic metres of AAC blocks annually.
G V PRATAP: CRISIL Reaffirms B+ Rating on INR4MM LT Loan
--------------------------------------------------------
CRISIL has reaffirmed the ratings on the bank facilities of
G. V Pratap Reddy at 'CRISIL B+/Stable/CRISIL A4'.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Cash Credit 2 CRISIL B+/Stable (Reaffirmed)
Letter of credit
& Bank Guarantee 4 CRISIL A4 (Reaffirmed)
Proposed Long Term
Bank Loan Facility 4 CRISIL B+/Stable (Reaffirmed)
The ratings reflect the firm's modest scale of operations, its
large working capital requirement, and its exposure to intense
competition in the civil construction industry. These weaknesses
are partially offset by its promoters' extensive experience in
the industry and its healthy order book.
CRISIL had earlier on Oct. 28, 2016 assigned its rating on the
bank facility of GVPR at 'CRISIL B+/Stable/CRISIL A4'
Key Rating Drivers & Detailed Description
Weaknesses
* Modest scale of operations
The business risk profile is constrained by modest scale of
operations and limited revenue diversity (Rs 25.3 crores in
fiscal 2016). The modest scale of operations limits the pricing
power with suppliers.
* Large working capital requirement
Gross current assets (GCAs) were high above 100 days over the
past three years ended March 31, 2016, partially due to the high
retention money retained by clients. The firm raises the bills on
a monthly basis and receives payment within 45-60 days from the
government.
* Exposure to intense competition in the civil construction
industry
In the construction and civil works sector, large players operate
in several sectors including roads, hydel projects, thermal
plants and urban infrastructure, while the abundant smaller
players' specialize in one or two business segments. Since a
major portion of the firm's orders are tender based, revenue is
dependent on the ability to bid successfully for them.
Strengths
* Promoter's extensive experience
GVPR benefits from its promoter's extensive experience. The
promoter of the firm has been associated with civil construction
sector for nearly 3 decades. The promoter of the company Mr. GV
Pratap Reddy (57 years) has around 3 decades of combined
experience in different industries across sectors.
* Healthy order book
The firm has orders worth INR100 crores as on October 2016 to be
executable over the next three years. It currently has INR45
crores of orders from Telangana State Municipal Corporation for
sand excavation and drainage work. Further, it has INR33 crores
of orders from Andhra Pradesh Vidyut and around INR22 crores
orders from Greater Hyderabad Municipal Corporation.
Outlook: Stable
CRISIL believes GVPR will continue to benefit from its promoters'
extensive industry experience. The outlook may be revised to
'Positive' if the company registers a substantial and sustained
increase in revenue, while maintaining its profitability, or if
its working capital cycle improves. The outlook may be revised to
'Negative' in case of a steep decline in its profitability, or
significant weakening of its capital structure because of a
stretch in its working capital cycle.
Established in 1985, G.V Pratap Reddy (GVPR) is a Hyderabad based
proprietorship firm engaged in the business of civil
construction. The firm is promoted by Mr. G.V. Pratap Reddy
GVPR reported a profit after tax (PAT) of INR0.99 crore on net
sales of INR25.36 crore for fiscal 2016, vis-a-vis INR0.36 crore
and INR3.57 crore, respectively, for fiscal 2015. (1 USD= 66.46
INR).
GLOBAL OFFSHORE: CARE Lowers Rating on INR380.49cr Loan to 'D'
--------------------------------------------------------------
The revision in the ratings of the bank facilities of Global
Offshore Services Ltd takes into account the on-going delay in
debt servicing obligation by the company. Earlier the rating had
been put under credit watch as the company had approached its
lenders for re-schedulement of debts on account of sudden re-
pricing of contracts by the clients.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long-term Bank 380.49 CARE D (Revised from
Facilities-Term CARE BB "credit watch")
Loan
Long-term Bank 44.00 CARE D (Revised from
Facilities-Fund- CARE BB "credit watch")
based Limits
Long/Short-term 28.00 CARE D/CARE D
Bank Facilities- (CARE BB/CARE A4
Non fund based "credit watch")
Detailed description of the key rating drivers
The revision in the ratings of the bank facilities of Global
Offshore Services Ltd takes into account the on-going delay in
debt servicing obligation by the company.
Sharp decline in E&P spending have worldwide affected players
like GOSL who are into chartering of support vessels for E&P
activity. Coupled with that there was re-pricing of contracts by
the principal client of the company i.e. ONGC in April 2016.
While majority of the vessels in its Netherlands subsidiary was
un-deployed. This has affected the cash generation ability and
hence liquidity of the company and the company had approached its
Lenders for reschedulement of debt. The reschedulement did not
materialize and the company had defaulted in repayment of its
term loan installments.
Global Offshore Services Ltd (GOSL; erstwhile Garware Offshore
Services Ltd) promoted by late Mr. B D Garware, has been
engaged in the offshore services business since 1984. The
company's vessels support the oil and gas exploration efforts
and are employed with various E&P companies. As on June 30, 2016,
the company had six vessels (two PSV's; Four ATHSV) in its books
and seven vessels (five PSV's and two AHTSV) in its subsidiaries
books with an average age of the vessels of about 6 years. GOSL
has two wholly-owned subsidiaries: Garware Offshore International
Services Pte Ltd (incorporated in Singapore) having one vessel
and Global Offshore Services B.V. (incorporated in The
Netherlands) having six vessels.
During FY16 (refers to the period April 1 to March 31), on a
standalone basis GOSL posted a PAT of INR30.01 crore (PY:
INR20.68 crore) on a total income of INR160.21 crore (PY:
INR91.40 crore). While during H1FY17 (on a standalone basis), the
company has posted a net loss of INR1.08 crore on a total income
of INR53.96 crore.
During FY16, on a consolidated basis GOSL posted a net loss of
INR25.39 crore (PY: Net profit of INR55.18 crore) on a total
income of INR372.74 crore (PY: INR400.44 crore). While during
H1FY17 (on a consolidated basis), the company had posted a net
loss of INR55.63 crore on a total income of INR92.44 crore.
GUPTA OVERSEAS: CARE Reaffirms B Rating on INR9.28cr LT Loan
------------------------------------------------------------
The rating assigned to the bank facilities of Gupta Overseas
Private Limited continue to remain constrained by small scale of
operations with low net worth base, declining profitability
margins and highly leveraged capital structure. The rating is
further constrained by susceptibility of margins to raw material
price volatility and presence of the company in a cyclical,
fragmented and competitive textile industry.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long-term Bank
Facilities 9.28 CARE B; Stable Reaffirmed
The rating continues to draw comfort from the experienced
promoters with long track record of operations, moderate
coverage indicators and moderate operating cycle.
Going forward, the ability of the company to increase its scale
of operations while stabilizing its profitability margins and
improving its capital structure shall be the key rating
sensitivities.
Detailed description of the key rating drivers
The total operating income of the company stood small and
fluctuating in the last 3 financial years (i.e. FY14-FY16). TOI
has registered a growth on y-o-y basis in FY15 and registers a
decline in FY16. The PBIDLT margin of the company has been
declining on y-o-y basis in last 3 financial years (i.e. FY14-
FY16) on account of increase in cost of production which could
not be fully passed on to its customers due to highly competitive
market.
Furthermore, the capital structure continues to remain leveraged
due to high dependence on external borrowings to meet the working
capital requirements coupled with low networth base. Coverage
indicators improved and stood moderate on account of lower
interest charges and lower debt. Operations of the firm continue
to remain moderate working capital intensive marked by operating
cycle of less than 60 days for FY15 & FY16.
The company is exposed to the raw material price volatility risk
due to the volatility experienced in the prices of raw cotton.
Since it constitute a major component of the raw material and
hence any volatility in their prices has a direct impact on the
profitability margins of the company. Furthermore, textile is a
cyclical industry and closely follows the macroeconomic business
cycles. Also, GPL operates in a highly competitive industry with
competition from both organized and unorganized players
established in vicinity of the company.
Panipat-based (Haryana) Gupta Overseas Private Limited (GPL) was
incorporated in 1998 by Mr. Sandeep Garg and Mr. Sudhir Garg
having an experience of more than a decade. GPL is engaged in the
manufacturing of cotton yarn and has its manufacturing facilities
located at Panipat, Haryana, with an installed capacity of
manufacturing 36 lakh kg of yarn per annum as on December 31,
2016. The company sells cotton yarn to manufacturers of fabric
(weaving units) in the domestic market through various agents and
distributors.
For FY16 (refers to the period April 01 to March 31), GPL
achieved a total operating income (TOI) of INR15.86 crore with
profit after tax (PAT) of and INR0.11 crore, respectively, as
against TOI of INR18.92 crore with PAT of INR0.12 crore, in FY15.
Furthermore, the company has achieved total TOI of INR11.00 crore
till 9MFY17 (refers to the period April 1 to December 31, based
on provisional results)
HERCULES AUTOMOBILES: Ind-Ra Assigns 'B+' Long-Term Issuer Rating
-----------------------------------------------------------------
India Ratings and Research (Ind-Ra) has assigned Hercules
Automobiles International Private Limited (HAIPL) a Long-Term
Issuer Rating of 'IND B+'. The Outlook is Stable.
KEY RATING DRIVERS
The ratings reflect HAIPL's weak credit metrics and thin
profitability. In FY16, net leverage (Ind-Ra total adjusted net
debt/operating EBITDAR) was 12.3x (FY15: 11.9x) and EBITDA
interest coverage (operating EBITDA/gross interest expense) was
0.5x (0.7x). Operating EBITDA margins remained within a tight
range of 0.7%-2.6% over FY11-FY16 due to trading nature of
business.
The ratings factor in the company's moderate liquidity position
with the fund-based facilities being utilized at an average of
96% over the 12 months ended December 2016.
The ratings are, however, supported by HAIPL's stable revenue
growth. Its revenue grew at a CAGR of 10.42% over FY11-FY16 to
INR2,358.3 million in FY16 due to increase in sales volume. The
ratings are further supported by more than a decade of experience
of the promoters in the Maruti Suzuki dealership business and
their continuous infusion of funds to support the operations in
the form of unsecured loans.
RATING SENSITIVITIES
Positive: Sustained improvement in the EBITDA margin leading to
improvement in the credit metrics will lead to a positive rating
action.
Negative: A decline in the EBITDA margin leading to stretched
liquidity will lead to negative rating action.
COMPANY PROFILE
Incorporated in 1999, HAIPL is the authorised dealer of Maruti
Suzuki India Limited at Alappuzha (Alleppey) and
Thiruvananthapuram in Kerala. It is engaged in sale of new cars,
pre-owned cars (under True Value outlets), spare parts and
accessories, and servicing. It also operates Maruti driving
school. As of date it has three showrooms, 21 retail outlets,
nine service centres, four True value outlets and five simulated
maruti driving schools.
INDERA GARMENTS: Ind-Ra Assigns 'BB-' Long-Term Issuer Rating
-------------------------------------------------------------
India Ratings and Research (Ind-Ra) has assigned Indera Garments
Private Limited (IGPT) a Long-Term Issuer Rating of 'IND BB-'.
The Outlook is Stable.
KEY RATING DRIVERS
The ratings reflect IGPT's small scale of operations and moderate
credit metrics. Revenue was INR126 million in FY16 (FY15:
INR135 million), interest coverage was 1.7x (1.7x) and net
financial leverage was 4.4x (3.4x).
The ratings factor in the company's tight liquidity position as
reflected from full utilization of its working capital limit,
along with instances of over utilization during the 12 months
ended December 2016, which were regularized within two days.
The ratings, however, are supported by an increase in EBITDA
margins over FY14-FY16 (10.4%, FY15: 10%, FY14: 9.3%) owing of
increased sale of high margin products. The ratings also benefit
from the directors' three-decade-long experience in the readymade
garment trading business.
RATING SENSITIVITIES
Positive: An increase in the revenue, while maintaining the
credit metrics will be positive for the ratings.
Negative: A further deterioration in the liquidity position will
be negative for the ratings.
COMPANY PROFILE
Incorporated in 2001, IGPT is engaged in the trading of readymade
garments, accessories and textiles. The company is managed by
Mr. Jaspreet Singh and Mrs Gurdish Kaur and has a retail showroom
in Rourkela, Odisha.
JADWET RESORTS: CRISIL Reaffirms 'B' Rating on INR10MM LT Loan
--------------------------------------------------------------
CRISIL has reaffirmed its rating on the long term bank facilities
of Jadwet Resorts and Leisure Private Limited at 'CRISIL
B/Stable'.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Long Term Loan 10 CRISIL B/Stable
The rating continues to reflect JRLPL's susceptibility to risks
related to implementation and stabilization of its ongoing hotel
project. This rating weakness is partially offset by the
extensive experience of JRLPL's promoters in the hospitality
industry and their funding support to the company.
Key Rating Drivers & Detailed Description
Weakness
* Susceptibility to risk related to implementation and
stabilization of its ongoing hotel project: The company remains
exposed to risks associated with successful implementation of
project. Also post implementation, JRLPL's project will be
exposed to competition from other established hotels in Havelock
Island, which will constrain the company's business risk profile
over the near to medium term.
Strength
*Extensive experience of promoters in the hospitality industry:
JRLPL is promoted by Mr. Mohamed Jadwet and Mr. Zakir Jadwet
(second-generation promoters of the Jadwet family). The Jadwet
family has been involved in various business activities in
Andaman and Nicobar Islands since the 1940s, and enjoys a good
reputation in the region. JRLPL will continue to benefit over the
medium term from its promoters' extensive experience in the
hospitality industry and the funding support extended from
promoters.
Outlook: Stable
CRISIL believes that JRLPL will benefit over the medium term from
its promoters' extensive industry experience and their fund
support. The outlook may be revised to 'Positive' if the company
completes its ongoing project on a timely basis and achieves
earlier than expected stabilization of operations. Conversely,
the outlook may be revised to 'Negative' in case of any
significant time or cost over-runs in the project or additional
debt-funded capital expenditure, leading to deterioration of the
company's financial risk profile.
Incorporated in 2013-14 (refers to financial year, April 1 to
March 31), JRLPL is based in Port Blair (Union Territory of
Andaman & Nicobar Islands) and is promoted by Mr. Mohamed Jadwet
and Mr. Zakir Jadwet.
The company is undertaking a project for setting up a high-end
spa resort on 9200 square metres on Vijay Nagar Beach in Havelock
(Andaman and Nicobar Islands). The project plan includes a 30-
room resort, one all-year restaurant, bar and lounge, indoor
meeting/conference space, and spa and scuba centre. The project
outlay is INR16 crore.
JP RICE: CRISIL Assigns B+ Rating to INR8MM Cash Loan
-----------------------------------------------------
CRISIL has assigned its 'CRISIL B+/Stable' rating to the long-
term bank facilities of J. P. Rice Mills - Fatehabad (JPRM).
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Cash Credit 8 CRISIL B+/Stable
Proposed Long Term
Bank Loan Facility 2 CRISIL B+/Stable
The rating reflects modest scale of operations in the intensely
competitive rice industry, subdued financial risk profile marked
by a modest net worth, high gearing and weak debt protection
metrics, exposure to fluctuations in raw material prices and
uneven monsoon, and the extensive experience of, and funding
from, its promoters.
Analytical Approach
Unsecured loans of INR3.0 crore (as on March 31, 2016) from
promoters have been treated as neither debt nor equity.
Key Rating Drivers & Detailed Description
Weaknesses
* Modest scale in intensely competitive rice industry: Limited
capacity and intense competition in the rice industry have led to
a small scale, reflected in revenue of INR30.5 crore in fiscal
2016. Modest scale also restricts benefits of economies of scale
and limits pricing flexibility, thereby constraining
profitability.
* Subdued financial risk profile: As on March 31, 2016, the
networth was small at INR0.9 crore and gearing high at over 5.52
times. With continued large working capital debt, gearing is
expected to remain high over the medium term. Interest coverage
ratio was muted at 1.43 times during fiscal 2016 due to low
profitability and high debt level.
* Exposure to volatility in raw material prices and uneven
monsoon: Vulnerability of the basmati crop to the vagaries of the
rainfall can lead to fluctuations in availability and prices of
paddy, and thus could impact the business risk profile of rice
processors such as JPRM.
Strengths
* Extensive experience of promoters: JPRM's promoter, Mr. Naresh
Bansal, have extensive experience and understanding of the
dynamics of the local market, which helps in anticipating price
trends and calibrating purchasing and stocking decisions.
* Promoters' funding support: Promoters have extended unsecured
loans of INR3.0 crore to meet incremental working capital
requirements.
Outlook: Stable
CRISIL believes JPRM will benefit over the medium term from the
extensive experience of its management. The outlook may be
revised to 'Positive' if substantial increase in revenue and
profitability leads to higher cash accrual and hence better
financial risk profile. The outlook may be revised to 'Negative'
if lower-than-expected profitability or sizeable debt further
weakens financial risk profile, particularly liquidity.
JPRM was setup in 1994 as proprietorship concern of Mr. Naresh
Bansal. The firm is engaged in milling of paddy into processed
rice. It has an installed paddy milling and sorting capacity of
50 tonnes per day (tpd). Its rice mill is located in Fatehabad,
Haryana.
Profit after tax (PAT) was INR0.05 crore on an operating income
of INR30.5 crore for fiscal 2016, against a PAT of INR0.05 crore
on an operating income of INR21.6 crore for fiscal 2015.
KELTRON COMPONENT: ICRA Reaffirms B- Rating on INR11.25cr Loan
--------------------------------------------------------------
ICRA has reaffirmed the long-term rating outstanding on the
INR11.25 crore long-term fund based facilities of Keltron
Component Complex Limited at [ICRA]B-. The outlook on the long-
term rating is stable. ICRA has also reaffirmed the short-term
rating outstanding on the INR12.75 crore short-term non-fund
based facilities of KCCL at [ICRA]A4.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long-term fund 11.25 [ICRA]B- (Stable)/(reaffirmed)
based facilities
Short-term non- 12.75 [ICRA]A4/(reaffirmed)
fund based
facilities
Rationale
The reaffirmation of ratings factors the continued operational
and financial support from its parent company, Kerala State
Electronic Development Corporation and Government of Kerala, and
KCCL's strong market share in the aluminium electrolytic
capacitors segment aided by its strong brand equity translating
into repeat orders. For FY2016, the company recorded a muted
revenue growth due to competition from Chinese imports and
capacity constraints, however operating margins expanded by 390
bps on the back of reduction in raw material costs due to
favorable forex movements. The ratings, however, remain
constrained by large accumulated losses and stretched
capitalization and coverage indicators; the losses being largely
funded through unsecured loans from the state government. The
limited pricing power enjoyed by the company by virtue of its
small scale of operations and stiff competition due to cheaper
imports from China continue to impact the ratings.
Key rating drivers
Credit Strengths
- Improving sales on the back of revival of demand in consumer
durables segment and addition of new products
- Long standing presence in the domestic passive electronic
components industry; leading market share of 10% in the
electrolytic capacitor segment
- Operational and financial support enjoyed from parent entity-
Kerala State Electronics Development Corporation (KSEDC), a
Kerala State government undertaking and the Government of
Kerala
Credit Concerns
- Stretched capital structure and inadequate coverage indicators
on account of sustained losses incurred over the years; high
operating costs results in low accruals and strained liquidity
- Intense competition from global players and imports and small
scale of operations restrict pricing flexibility and
contribution margins
Description of key rating drivers highlighted:
Despite a revival in demand in consumer durables segment, KCCL
registered a muted revenue growth of 4% in FY2016 from INR59.3
crore in FY2015 to INR61.8 crore in FY2016 affected by rising
imports from China (which are atleast 10% cheaper than KCCL's
products) and capacity related constraints as the company is
running at a utilization of 96% in its metallised capacitor
segment. KCCL commands over 10% market share in the aluminum
electrolytic capacitor and metallised plastic capacitor segments,
amidst stiff competition from the large unorganized / fragmented
market.
With 60% of the raw material being imported from Japan, France,
Malaysia and China, a depreciation of the Ringgit against INR
boosted operating profits leading to a margin expansion of 390
bps in FY2016. The company's financial profile remain affected by
sizeable accumulated losses and stretched capitalization and
coverage indicators. KCCL continues to derive financial support
(in the form of unsecured loans) from the State government and
KSEDC for loss funding, working capital needs and capacity
expansions. Going forward, steady increase in revenues and
improvement in contribution margins from new products would be
critical to expand the profit margins; which coupled with
conversion of unsecured loans to equity shall improve the debt
coverage indicators.
Keltron Component Complex Limited is a subsidiary of Kerala State
Electronics Development Corporation Limited, a Government of
Kerala undertaking. KSEDC produces a wide range of products
ranging from discrete electronics components to complex telecom
equipment and other systems. KSEDC entered the electronic
components space by setting up an Aluminium Electrolytic
Capacitor plant in technical collaboration with Spargue
Electromag, Belgium, in 1976 under KCCL in Kannur, Kerala.
Aluminium Electrolytic Capacitors and Metallised Plastic Film
Capacitors are the major product segments of KCCL which
contribute to more than 95% of the total revenues of KCCL.
KGPS MECHANICAL: CRISIL Assigns 'B' Rating to INR5.24MM Loan
------------------------------------------------------------
CRISIL has assigned its 'CRISIL B/Stable/CRISIL A4' ratings to
the bank facilities of KGPS Mechanical Private Limited.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Proposed Long Term
Bank Loan Facility 2.26 CRISIL B/Stable
Bank Guarantee 2.50 CRISIL A4
Cash Credit 5.24 CRISIL B/Stable
The ratings reflect the company's modest and fluctuating revenue,
and large working capital requirement because of sizeable
receivables. The ratings also factor its subdued financial risk
profile on account of small networth and weak debt protection
metrics, exacerbated by ongoing debt-funded capital expenditure
(capex). These weaknesses are partially offset by its promoters'
extensive experience in fabrication of mechanical structures,
piping, and material handling systems for a variety of
industries, and its established customer relationships.
Key Rating Drivers & Detailed Description
Weaknesses
* Modest and fluctuating revenue: KGPS's revenue was Rs14.0 crore
in fiscal 2016, down from INR18.8 crore in fiscal 2015. The
revenue fluctuates as it is susceptible to performance and
investment cycles of key end-user industries such as cement,
chemicals, and fast-moving consumer goods (FMCG).
* Average financial risk profile: The company had a small
networth of INR5.6 crore as on March 31, 2016, and subdued debt
protection metrics, reflected in interest coverage and net cash
accrual to total debt ratios of 1.73 times and 0.09 time,
respectively, in fiscal 2016. Its capital structure is
comfortable, indicated by total outside liabilities to tangible
networth of 2 times as on March 31, 2016. The company is
undertaking capex of INR8 crore to set up a large workshop. Debt
to fund the capex and working capital requirement will keep the
financial risk profile subdued over the medium term.
* Large working capital requirement: Gross current assets were
over 160 days in the two fiscals ended March 31, 2016, due to
receivables of over 105 days.
Strength
* Extensive experience of promoters and strong clientele:
Promoters' experience of more than two decades and strong track
record in the heavy fabrication industry has helped the company
establish a strong clientele that includes public sector
undertakings and private sector entities.
Outlook: Stable
CRISIL believes KGPS will benefit from its promoters' extensive
industry experience. The outlook may be revised to 'Positive' if
there is a substantial increase in revenue and profitability,
leading to sizeable cash accrual. The outlook may be revised to
'Negative' if low accrual, or larger-than-expected working
capital requirement, or sizeable, debt-funded capex weakens the
financial risk profile, especially liquidity.
KGPS undertakes mechanical fabrication work for tanks,
structures, and piping, and material handling for industries such
as petroleum and chemicals, cement, and FMCG. KGPS is promoted by
Mr Subramanian Pachat and Mr Santhosh Pachat.
KGPS's profit after tax (PAT) was INR0.16 crore on operating
income of INR13.8 crore for fiscal 2016, against a PAT of INR0.45
crore on operating income of INR18.8 crore for fiscal 2015.
Status of non-cooperation with previous CRA: KGPS has not
cooperated with Credit Analysis & Research Ltd, which suspended
its ratings on the company through a release dated March 7, 2016.
Reason provided by Credit Analysis & Research Ltd was non-
furnishing of information by KGPS for monitoring ratings.
LAHOTY BROTHERS: Ind-Ra Affirms 'BB+' Long-Term Issuer Rating
-------------------------------------------------------------
India Ratings and Research (Ind-Ra) has affirmed Lahoty Brothers
Private limited's (LBPL) Long-Term Issuer Rating at 'IND BB+'.
The Outlook is Stable.
KEY RATING DRIVERS
The affirmation reflects LBPL's continued moderate scale of
operations and credit profile. During FY16, LBPL's revenue was
INR1,291 million (FY15: INR1,524 million), interest coverage
(operating EBITDA margins/ gross interest expenses) was 1.3x
(1.3x) and net leverage (net debt/ operating EBITDA margin) was
5.9x (4.0x) along with EBITDA margin of 1.3% (1.1%). Revenue
declined during FY16 due to decline in the oil prices which
contribute around 66% to the total revenue.
The company's maximum use of bank loan limits continued to be
moderate at 84.7% on an average for the 12 months ended December
2016.
The ratings are supported by LBPL's promoter's experience of over
three decades in the trading line of business and the company's
association with reputed brands such as Orient Electric (a
division of Orient Paper and Industries Limited) and Osram India
Private Limited for which it is a distributor in Assam.
RATING SENSITIVITIES
Positive: Improvement in the profitability and overall credit
metrics could be positive for the ratings.
Negative: Deterioration in the overall credit metrics could be
negative for the ratings.
COMPANY PROFILE
Incorporated in 1943, LBPL is engaged in various trading
activities such as product distribution for Orient Electric and
Osram India Private Limited in Assam, and commodity trading of
raw jute. It also operates six petrol pumps in Assam.
The firm is managed by its four directors Prem Ratan Lahoty,
Arvind Jatia, Savita Lahoty and Sangeeta Jatia.
LORD BALAJI: Ind-Ra Assigns 'D' Long-Term Issuer Rating
-------------------------------------------------------
India Ratings and Research (Ind-Ra) has assigned Lord Balaji
Warehousing Private Limited (LBWPL) a Long-Term Issuer Rating of
'IND D'.
KEY RATING DRIVERS
The ratings reflect instances of delay in servicing of term loans
by LBWPL for the three months ended December 2016, due to the
delay in receipt of rental income.
RATING SENSITIVITIES
Positive: Timely debt servicing for at least three months would
be positive for the ratings.
COMPANY PROFILE
Incorporated in 2011, LBWPL is engaged in the business of
building and renting of warehouses. LBWPL started generating
revenue from FY16. The company is promoted by Mr. Rakesh Bansal
and has its registered offices at East Vinod Nagar, Delhi.
MALNADY TEA: Ind-Ra Assigns 'BB+' Long-Term Issuer Rating
---------------------------------------------------------
India Ratings and Research (Ind-Ra) has assigned Malnady Tea
Estate Private Limited (MTEPL) a Long-Term Issuer Rating of
'IND BB+'. The Outlook is Stable.
KEY RATING DRIVERS
MTEPL's ratings reflect its moderate scale of operations and
moderate credit profile. In FY16, revenue increased to
INR100.5 million (FY15: INR44 million), due to an improvement in
tea demand and the commencement of veneer trading. Consequently,
interest coverage (operating EBITDA/gross interest expenses)
increased to 2.3x (1.9x) and net leverage (adjusted net
debt/operating EBITDA) reduced to 3.7x (5.1x). However,
operating margin fell to 11.3% during FY16 from 20.5% FY15 on
account of an increase in raw material costs.
The company has a moderate liquidity profile reflected in its 93%
average utilization of the working capital facility for the 12
months ended December 2016.
The ratings are supported by MTEPL's promoter's experience of
over four decades in the tea trading business.
RATING SENSITIVITIES
Negative: Further deterioration in the operating margins and
overall credit metrics would be negative for the ratings.
Positive: A substantial improvement in the scale of operations
and credit metrics will be positive for the ratings.
COMPANY PROFILE
MTEPL was incorporated in 1973 under the flagship of Mr. Ashok
Garg. MTEPL has its registered office in Kolkata and a tea
garden in Malbazar, Jalpaiguri. The total area under cultivation
of Malnady Tea Estate is around 98ha. MTEPL manufactures green
tea and trades veneer tea.
MANGLAM PAPER: Ind-Ra Assigns 'BB-' Long-Term Issuer Rating
-----------------------------------------------------------
India Ratings and Research (Ind-Ra) has assigned Manglam Paper
Private Limited (MPPL) a Long-Term Issuer Rating of 'IND BB-'.
The Outlook is Stable.
KEY RATING DRIVERS
The ratings reflect MPPL's small scale of operations and weak
credit profile. Revenue was INR215 million in FY16 (FY15: INR210
million), net leverage (total Ind-Ra adjusted net debt/operating
EBITDAR) was 5.5x (3.2x) and gross interest cover (operating
EBITDA/gross interest expense) was 1.8x (2.6x). EBITDA margins
were low at 4.9% in FY16 and remained volatile between 4.9%-6.5%
over FY12-FY16 on account of the trading nature of the business.
As of December 2016, MMPL has an order book of INR50 million,
which will be executed by end-February 2017. The company has
indicated revenue of INR210 million in 1HFY17.
However, the ratings are supported by the company's comfortable
liquidity position with an average use of fund-based facilities
of 50% over the 12 months ended January 2017. The ratings also
factor in the promoter's more than three decades of experience in
the kraft paper trading business.
RATING SENSITIVITIES
Negative: A decline in the top line and EBITDA margins leading to
deterioration in the credit metrics would be negative for the
ratings.
Positive: A significant increase in the top line and EBITDA
margins leading to a sustained improvement in the credit metrics
would be positive for the ratings.
COMPANY PROFILE
Incorporated in 1982, MMPL is engaged in trading of kraft paper.
Among the promoters, Mr. Lalit Kumar Patel has 35 years of
experience in the paper manufacturing industry. The company's
day-to-day operations are carried out by Mr. Lalit Kumar Patel
and his son Mr. Dharma Patel.
MPPL is planning to start a manufacturing unit in Ahmedabad, with
an installed capacity of 110 tonnes per day and capacity
utilization of 90% to manufacture kraft paper in the range of 80-
250 grams per square meter. As of December 2016, around 80% of
the machinery was installed and the manufacturing unit is in the
completion stage.
MPPL imports 50% of its raw material (old corrugated cartoons,
and uncoated paper and paper board) from the US, the UK, Belgium
and other Arabian countries, while the remaining 50% is
domestically sourced from Ahmedabad, Surat and Rajkot. MMPL
intends to export its products to Africa and Dubai. The trail
production will begin by end-February 2017, and is expected to
commence commercial production in March 2017.
MARBILANO TILES: ICRA Assigns 'B' Rating to INR19cr Loan
--------------------------------------------------------
ICRA assigned the long term rating of [ICRA]B for the INR19.00
crore fund based facilities (enhanced from INR9.00 crore) and the
short term rating of [ICRA]A4 to the INR2.00 crore non fund based
facility of Marbilano Tiles LLP. The outlook on the long term
rating is 'Stable'.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Fund Based Limits 19.00 [ICRA]B (Stable)
Assigned/Outstanding
Non Fund Based Limits 2.00 [ICRA]A4 Assigned
Rationale
The assigned rating is constrained by the nascent stage of the
firm's operations and the risk associated with timely
commencement of unit within budgeted cost and its stabilisation
as per the expected operating parameters. The rating also remains
constrained by the high fragmentation and competitive intensity
in the tiles industry and the cyclicality associated with the
real estate industry which is the main consuming sector. The
ratings further factors in the exposure of the firm's
profitability to volatility in raw material and gas prices as
well as to adverse foreign exchange fluctuations. Further, the
assigned rating takes into account the firm's financial profile,
which is expected to remain stretched in the near term given the
debt-funded nature of the project and impending debt repayment.
The assigned rating, however, favorably factors in the experience
of the promoters in the ceramic industry; the location advantage
of the firm for raw material procurement by virtue of its
presence in Morbi (Gujarat) and the benefits derived from its
established associate concern in terms of marketing and
distribution network.
In ICRA's view, the ability of the timely commissioning of the
project within the budgeted cost and stabilisation of operations
as per the expected parameters will remain crucial from the
credit perspective. Firm's sizeable reliance on debt funding
towards the capex and associated servicing burden is expected to
keep the capital structure and liquidity position of the company
stretched over the near to medium term. The ability of the firm
to establish a market for its products; scale up its operations
in a profitable manner amidst intense competition and maintain a
healthy financial risk profile will remain some of the key
monitorables.
Key rating drivers
Credit Strengths
* Past experience of the promoters in the ceramic industry
* Proximity to raw material sources
* Marketing and operational support from associate concern;
the firm expects to leverage from associate concerns
distribution network
Credit Weakness
* Risk associated with stabilisation and successful scale up
of operations as per expected operating parameters
* Significant debt repayments coupled with long gestation period
likely to keep the credit profile constrained over the near
term
* Competitive business environment given the fragmented nature
of industry and company's single product profile
* Profitability to remain susceptible to volatility in raw
material and fuel prices
* Vulnerability of profitability and cash flows to cyclicality
inherent in the real estate industry, which is the main
consuming sector.
Description of key rating drivers highlighted:
Marbilano Tiles LLP plans to manufacture medium sized glazed
vitrified tiles in the sizes - 600mmx600mm and 600mmx1200mm. The
unit has an estimated installed capacity of producing 63000
metric tonnes of tiles per annum. The project cost is INR29.29
crore. The land has been acquired & developed and machinery is
under installation which is scheduled to get completed by mid of
Feb 2017 and the commercial operations are expected to commence
from April 2017. Timely completion of the project without any
cost overrun and scaling up of operations remain critical from
the credit perspective. The aggressive D/E ratio for the project
and significant debt repayments coupled with long gestation
period is likely to keep the credit profile constrained over the
near term. The company's ability to compete with number of
organised and unorganised players in ceramic industry with
maintaining adequate profitability despite volatility in raw
material and fuel prices remains the key rating sensitivities.
Nevertheless, the extensive experience of promoter through their
association with group entity along with established marketing
and distribution network is expected to support the operations of
the company.
Established in November 2015 as a limited liability partnership
firm - Marbilano Tiles LLP, is setting up a Greenfield project at
Morbi in Gujarat to manufacture medium-sized glazed vitrified
tiles of two different sizes. The unit will have an installed
capacity of producing 63,000 MT tiles per annum. The commercial
operations are expected to commence from April 2017. The
promoters have past experience in the ceramic industry by virtue
of their association with Saicon Tiles Pvt Ltd and Pyramid
Ceramic engaged in tiles manufacturing.
MOMAI FOODS: CARE Assigns B+ Rating to INR9.86cr Long Term Loan
---------------------------------------------------------------
The rating assigned to the bank facilities of Momai Foods Private
Limited are primarily constrained on account of its modest scale
of operations and profitability along with leveraged capital
structure and moderate debt coverage indicators, modest liquidity
position during FY16 (refers to the period April1 to March 31).
The rating is further constrained on account of intense
competitive presence in the industry.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long-term Bank
Facilities 9.86 CARE B+; Stable Assigned
The rating however, continues to derive strength from experienced
directors and healthy operating profitability.
MFPL's ability to increase its scale of operations along with
profitability margins and efficiently managing its working
capital would be the key rating sensitivity.
Detailed description of key rating drivers
The capital structure of the company stood leveraged marked by
debt equity ratio and overall gearing of 4.68 times and 6.10
times, respectively as on March 31, 2016 (Audited) as against
4.30 times and 4.98 times as on March 31, 2015.
The current ratio of the company stood modest at 0.93 times as on
March 31, 2016 as against 1.06 times as on March 31, 2015 owing
to working capital borrowings as on balance sheet date. Operating
cycle of the company elongated to 133 days in FY16 as compared to
82 days in FY15 primarily due to increase in inventory period.
The cash flow from operations although improved, stood moderate
at INR0.37 crore during FY16 as against operating cash outflow
INR0.67 crore during FY15 on account of increase in PBILDT during
FY16.
However, In spite of having an operational track record of less
than 3 years, the PBILDT margin of the company improved
by 70 bps and stood comfortable at 18.24% during FY16 and against
17.54% during FY15. Also, the directors of the
company have extensive experience in the industry.
Rajkot-based (Gujarat), Momai Foods Private Limited (MFPL) is a
private limited company established in 2013 by Mr. Bhaveshbhai
Khatra, Mr. Mehulbhai Khatra and Mr. Chandubhai Khatra. The
company is engaged in the business of manufacturing of ice cream.
The company sells its products in state of Gujarat, Rajasthan and
Madhya Pradesh. The company has installed capacity of 1.2 crore
liters of ice cream per annum. The company sells its product
under the brand name 'MOMAI'. The company sells its ice cream
through its network of 40 distributors and 6 retail outlets. The
company has ISO 22000:2005 certification for food safety
management system.
During FY16 (A), MFPL reported net loss of INR0.01 crore on a TOI
of INR5.00 crore as against net profit of INR0.01 crore on
a TOI of INR3.30 crore during FY15. Till January 28, 2016 MFPL
has achieved a turnover of INR5.00 crore.
MV AGRO: ICRA Revises Rating on INR11.50cr Loan to B-
-----------------------------------------------------
ICRA has revised the long-term rating assigned to INR15.50 crore
fund based limits and INR0.50 crore unallocated limits of MV Agro
Renewable Energy Private Limited from [ICRA]B+ to [ICRA]B-. ICRA
has re-affirmed the short term rating assigned to the INR0.50
crore unallocated limits at [ICRA]A4. The outlook on the long
term rating is 'Stable'.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long Term; Fund 11.50 [ICRA]B-(Stable)/revised
Based-Term Loan from [ICRA]B+
Long Term; Fund 4.00 [ICRA]B-(Stable)/revised
Based-Cash Credit from [ICRA[B+
Long Term/Short 0.50 [ICRA]B-(Stable)/revised
Term; Unallocated from [ICRA]B+;
[ICRA]A4/reaffirmed
Rationale
The rating revision primarily takes into account lower than
expected capacity utilisation, which is likely to result into
modest scale of operations. ICRA takes note of the low bargaining
power of the company with its customers, which are MNCs,
resulting in lower than expected realisation per MT, thus
directly impacting the revenues of the company. Given the
undeveloped market for bio fuel pellets, with the prospective
clients required to be educated and convinced about their
utility, efficiency and cost effectiveness as a fuel viz-a-viz
other fuels, the company might need time so scale its operations.
The rating revision, however, continue to favorably factor in the
substantial experience of the promoters in diverse industry
segments and setting of new businesses. The ratings take into
consideration the proximity of the business to large biomass
(Juli Flora, Subabul, and Eucalyptus) producing areas which are
the primary raw materials for making bio fuel pellets. The
ratings also incorporate incentives likely to be received by the
company from Andhra Pradesh state government under Industrial
Development Policy 2015-2020. Going forward, the company's
ability to scale-up the operations while improving the
realisations and become profitable will remain the key rating
sensitivities from credit perspective.
Key rating drivers
Credit Strengths
* Substantial experience of the promoters in diverse industry
segments and setting of new businesses
* Proximity of the business to large biomass (Juli Flora,
Subabul, and Eucalyptus) producing areas which are the primary
raw materials for making Bio fuel pellets
* Eligibility for Incentives provided by the Andhra Pradesh
State Government under Industrial Development Policy 2015-2020
* First-mover advantage marked by presence of only a few players
in the bio fuel pellet industry
Credit Weakness
* Modest scale of operations, on account of lower than expected
capacity utilisation
* Weak financial profile of the company characterized by weak
capitalisation and coverage indicators
* Inability of the company to enter into any long term contracts
with prospective customers till date; being a new product, the
market of the same is not developed and hence prospective
clients need to be educated
* Low bargaining power with its customers which are MNC's
resulting in lower realizations per MT
Description of key rating drivers highlighted:
M V Agro Renewable Energy Private Limited, incorporated in year
2014, is engaged in the manufacturing of bio fuel pellets from
agro wastes, plant residues, stems and plant biomass as the
primary sources of raw materials. The Managing Director, Mr. K.
Kiran Kumar is an engineer-technocrat and promoter of MV Infra
Services Pvt Ltd and MV Builders and Developers. He has over
fifteen years of experience as the head of this business
enterprise. The company has commissioned a bio fuel pellet
manufacturing facility with an installed capacity of 150 tons per
day located at Gundla Samudram Village, Podili, Marripudi Mandal,
Praskasham Dist, Andhra Pradesh. The primary raw materials for
manufacturing bio fuel pellets like Juli Flora, Subabul, and
Eucalyptus are available in plenty and grown extensively in the
surrounding areas. The bio fuel pellets possess better
characteristics as compared to other conventional fuels and find
commercial applications in a wide range of sectors such as
energy, industrial units, hotels and catering services. The
company is also eligible for several incentives like interest
reimbursement, VAT reimbursements, land conversion
reimbursements, power subsidy and capex subsidy from state
government under Industrial Development Policy 2015-2020.
The company declared COD (Commercial Operations Date) on April
1st, 2016. The market for bio fuel pellets is not developed and
hence prospective clients needs to be educated and convinced
about their utility efficiency and cost effectiveness as a fuel
viz-a-viz other conventional fuels. During FY2017, the company
was not able to enter into any long term contracts with its
customer for offtake of bio fuel pellets resulting in lower than
expected capacity utilisation which is likely to impact operating
and net profitability for the financial year. The company has low
bargaining power with its customers and hence it is required to
sell the products at a lower price which is likely to have an
impact on operating income of the company over short to medium
term.
M V Agro Renewable Energy Private Limited, incorporated in year
2014, is engaged in the manufacturing of bio fuel pellets from
agro wastes, plant residues, stems and plant biomass as the
primary sources of raw materials. The company has an installed
capacity of 150 tons per day and its manufacturing facility is
located in Praskasham Dist, Andhra Pradesh. The company started
its operations in 2016.
The company reported a net loss of INR0.25 crore on an operating
income of INR0.60 crore in FY2016.
OZONE DIAMONDS: Ind-Ra Assigns 'BB-' Long-Term Issuer Rating
------------------------------------------------------------
India Ratings and Research (Ind-Ra) has assigned Ozone Diamonds
Private Limited (ODPL) a Long-Term Issuer Rating of 'IND BB-'.
The Outlook is Stable.
KEY RATING DRIVERS
The ratings reflect ODPL's moderate credit profile. ODPL's
revenue was INR568 million in FY16 (FY15:530 million) and EBITDA
margins improved to 2.4% (2.3%) on account of higher demand for
diamonds during the year. Net leverage (total adjusted net
debt/operating EBITDAR) was 5.6x in FY16 (3.1x) and interest
coverage (operating EBITDA/gross interest expense) was 2.4x in
FY16 (3.6x). ODPL has an order book of INR62 million as of
December 2016 to be executed within the next two months. ODPL
has recorded revenue of INR614 million during 9MFY17 (interim).
ODPL's top-line will improve in FY17 as the company has already
indicated revenue of INR614 million, which is higher than FY16's
overall revenue of INR568 million.
The ratings, however, are supported by promoters' experience of
more than two decades in diamond market.
ODPL's liquidity remains comfortable with its fund-based
facilities being utilized at an average of 37% over the 12 months
ended October 2016.
RATING SENSITIVITIES
Positive: A significant increase in revenue and profitability
leading to sustained improvement in the credit metrics could be
positive for the ratings.
Negative: Substantial decline in profitability leading to
deterioration in the credit metrics will be negative for the
ratings.
COMPANY PROFILE
ODPL was incorporated in 2009. The company is engaged in the
manufacturing business of diamonds. Virtually only round shape
diamond is manufactured by the company. The company only deals
in small size diamonds, which are of 1 carat. ODPL's
manufacturing unit is located in Surat and its office is located
in Mumbai. Since its incorporation the company has been building
a strong global presence in the diamonds business through its
customer and supplier base in South Korea, New York, Belgium,
Dubai and Israel. The company is presently exporting to Hong
Kong, Taiwan and Israel which are its key markets.
PARINEE SHELTERS: CRISIL Lowers Rating on INR81MM NCDs to D
-----------------------------------------------------------
CRISIL has downgraded its rating on the Non-Convertible
Debentures (NCDs) of Parinee Shelters Private Limited (PSPL) to
'CRISIL D' from 'CRISIL BB-(SO)/Stable'.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Non Convertible 81 CRISIL D (Downgraded from
Debentures 'CRISIL BB-(SO)/Stable')
The rating downgrade reflects delays in debt servicing of INR50
crore NCD due to lower than expected sales in its residential
projects. The slowdown in sales was mainly on account of stalled
construction progress with delay in receipt of additional Floor
Space Index (FSI) approval from Municipal Corporation of Greater
Mumbai (MCGM).
Analytical Approach
PSPL is part of Parinee group that has developed residential and
commercial projects covering about 1.5 million square feet (sq
ft) in Mumbai. The group has issued NCDs in PSPL (which is
implementing Liva Roca project) as well as in two other companies
implementing two other projects (11 West and Aria projects).
Although each of the three projects have a separate escrow
account and a well-defined payment waterfall, the surplus cash
flows of each project after meeting their respective expenses and
debt obligations will be fungible and available to other
projects, in case of cash shortfall. For arriving at its rating,
CRISIL has combined the business and financial risk profiles of
the three projects, because of their common management and
fungible cash flows.
Key Rating Drivers & Detailed Description
Weaknesses
* Delays in debt servicing due to lower than expected sales;
primarily on account of delay in receiving approvals from MCGM
PSPL has witnessed delays in meeting its principal repayment
obligations on INR 50 crore NCD, primarily on account of lower
than expected sales in the current subdued real estate
environment and delays in getting MCGM approval for additional
FSI.
The company had paid the FSI premium to Maharashtra Housing and
Area Development Authority (MHADA) in February 2016 and applied
immediately to MCGM for approval of amended plan. After delay of
about 9 months, MCGM has now given approval for 3.50 FSI in first
stage and approval for remaining FSI is expected shortly.
* Exposure to project implementation risk and receipt of
approvals
The group is exposed to risks related to implementation as well
as receipt of approval for additional FSI in its projects. MCGM
approval for 3.5 FSI approval has been received recently; however
approval for remaining FSI is awaited. The construction of 11
West project is almost complete; the construction work of the
remaining two projects is also at an advanced stage.
Any significant delay in Parinee group's project implementation
could adversely affect its cashflow position. .
* Susceptibility of sales to cyclicality inherent in the real
estate sector
PSPL, being a real estate developer, its financial risk profile
is exposed to risks and cyclicality inherent in the real estate
sector. This in turn could result in fluctuations in cash inflows
because of volatility in realisations and saleability. In
contrast, cash outflows related to project completion and debt
obligations, are relatively fixed, which can lead to substantial
cash flow mismatches.
Strength
* Extensive experience of PSPL's promoters and prime location of
the project
The promoters have extensive experience of over 50 years in the
real estate and construction business. The promoters have
primarily focused on Slum Rehabilitation and society
redevelopment projects and have completed these projects with
good construction quality.
The three projects of the group - 11 West, Liva Rocca and Aria
are located in the prime area of Juhu, Mumbai. Juhu is a suburban
neighbourhood of western Mumbai and one of the most affluent
areas of Mumbai as well as home to many famous Bollywood actors.
Parinee group has good experience and proven track record of
society redevelopment projects as well as saleability of the
projects in this area. Although the velocity of sales has been
low in this area owing to subdued economic environment in the
past 1-2 years, the sales are expected to pick up in the medium
term. The promoters' established brand name and network with the
high net worth individual (HNI) clients is expected to help
saleability of the projects in prime location of Juhu
Incorporated in 2007, PSPL is owned by the promoters of the
Parinee group, Mr. Vipul Shah and Mr. Dhaval Shah. PSPL was set
up to undertake the society redevelopment project in Juhu Vile
Parle Development Scheme (JVPD).
The Parinee group was established in 1963 with the setting up of
PD Construction, known as PD group, by Mr. Dilip Shah and his two
sons Mr. Vipul Shah and Mr. Dhaval Shah. The group has developed
projects covering 1.5 million sq ft so far, including the
prestigious Parinee Crescenzo project at Bandra-Kurla Complex,
Mumbai, which is a 1.1 million sq ft commercial project. Parinee
Realty Pvt Ltd is the flagship company of the group, and houses
all the ongoing and upcoming projects through various
subsidiaries. PRPL is currently developing projects totalling 2.1
million sq ft at various locations in Mumbai.
PINAKEE ENGINEERS: Ind-Ra Affirms 'B+' Long-Term Issuer Rating
--------------------------------------------------------------
India Ratings and Research (Ind-Ra) has affirmed Pinakee
Engineers & Developers' (Pinakee) Long-Term Issuer Rating at 'IND
B+'. The Outlook is Stable.
KEY RATING DRIVERS
The affirmation reflects an increase in Pinakee's order book size
and small scale of operations. The company has an outstanding
order book of INR689 million as on December 2016 (20x of FY16
revenue) providing revenue visibility for the next two years. In
FY16, revenue was INR34 million (FY15: INR3 million); FY17 is the
second full year of operations and the company booked revenue of
INR50 million in 9MFY17 (interim numbers). India Ratings expects
the company to execute the outstanding order of INR267 million by
March 2017
The ratings are constrained by Pinakee's weak credit metrics with
net leverage (adjusted debt net of cash/EBITDA) improving to
11.67x in FY16 (FY15: 38.75x) and EBITDA interest coverage
(operating EBITDA/gross interest expense) declining to 0.94x in
(20.69x) due to slowdown in the revenue growth.
The ratings, however, are supported by promoters' three-decade-
long experience in the civil construction business. The ratings
factor in the absence of term debt in the company's books of
account and comfortable liquidity with an average peak
utilization of the fund-based working capital facilities being
63% during the 12 months ended December 2016.
In 1HFY18 the company will apply for Public Works Department
(PWD) certification for direct bidding on the government projects
for construction works in Rajasthan and Gujrat.
RATING SENSITIVITIES
Positive: Substantial growth in top-line and ability to maintain
profitability leading to strong liquidity will lead to a positive
rating action.
Negative: Any delay in execution of projects in hand or inability
to achieve desired revenue and profitability may lead to a
negative rating action.
COMPANY PROFILE
Pinakee is a partnership firm set up in October 2014. Pinakee is
engaged in civil construction work as a sub-contractor for J
Kumar Infraprojects Ltd ('IND A+'/Stable), Prime Civil
Infrastructures and Noble Construction Co.
PRICE & BUCKLAND: Ind-Ra Assigns 'B+' Long-Term Issuer Rating
-------------------------------------------------------------
India Ratings and Research (Ind-Ra) has assigned Price & Buckland
(India) Private Limited (PBIPL) a Long-Term Issuer Rating of
'IND B+'. The Outlook is Stable.
KEY RATING DRIVERS
The ratings are constrained by PBIPL's presence in the highly
fragmented and intensely competitive textile industry, as well as
currency fluctuation risk as the company exports a major chunk
(around 70%) of its output to countries such as the UK and Dubai,
among others.
The ratings reflect PBIPL's small scale of operations and
moderate credit metrics. The company reported revenue of
INR173.67 million in FY16 (FY15: INR174.6 million), interest
coverage (operating EBITDA/gross interest expense) of 2.58x
(3.46x) and net leverage (adjusted net debt/operating EBITDA) of
7.35x (6.14x).
However, the ratings draw comfort from PBIPL's comfortable
liquidity profile with an average utilization of around 79% of
its fund-based limits over the past 12 months ended January 2017,
and the promoters' almost a decade-long experience in the textile
industry.
RATING SENSITIVITIES
Negative: An increase in the working capital requirements leading
to a stress on the liquidity profile and/or deterioration in the
credit metrics on a sustained basis will be negative for the
ratings.
Positive: A significant improvement in the top line, while
sustaining the current credit profile will be positive for the
ratings.
COMPANY PROFILE
PBIPL was established in 2010 as a private company with Naveen
Thapliyal, Nick Buckland and Ant Buckland as the promoters. The
company is a subsidiary of Price & Buckland Ltd - a famous
British brand for premium school wear. PLIPL undertakes
manufacturing of premium school wear and sportswear with a
production capacity of 100,000 pieces per month.
RAJSHRI IRON: Ind-Ra Lowers Long-Term Issuer Rating to 'B'
----------------------------------------------------------
India Ratings and Research (Ind-Ra) has downgraded Rajshri Iron
Industries Private Limited (RIIPL) Long-Term Issuer Rating to
'IND B' from 'IND B+'. The Outlook is Stable.
KEY RATING DRIVERS
The downgrade reflects deterioration of RIIPL's overall financial
profile in FY16 due to high competition and sluggish market
condition. The company reported revenue of INR510 million in
FY16 (FY15: INR608 million); EBITDA margin of 4.4% (8.2%),
interest coverage (operating EBITDA/gross interest expense) of
0.69x (negative 1.51x) and leverage (total adjusted net
debt/operating EBITDAR) of 19.64x (9.77x).
The ratings are constrained by RIIPL's tight liquidity position
as reflected by its average use of working capital limits of 96%
during the 12 months ended December 2016.
However, the ratings continue to benefit from the promoter's six
years of experience in the steel industry.
RATING SENSITIVITIES
Negative: Deterioration in the overall credit metrics and
liquidity profile could be negative for the ratings.
Positive: An improvement in profitability margin leading to an
improvement in the overall credit metrics will be positive for
the ratings.
COMPANY PROFILE
Incorporated in 2004, RIIPL manufactures sponge iron. The
company commenced commercial production in FY10 at its 60,000mtpa
plant in Jamuria, West Bengal.
RHEOPLAST TECHNOLOGY: CRISIL Lowers Rating on INR7MM Loan to B
--------------------------------------------------------------
CRISIL has downgraded its rating on the long-term bank facilities
of Rheoplast Technology Private Limited to 'CRISIL B/Stable' from
'CRISIL B+/Stable'.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Cash Credit 7 CRISIL B/Stable (Downgraded
from 'CRISIL B+/Stable')
Foreign Letter 2 CRISIL B/Stable (Downgraded
of Credit from 'CRISIL B+/Stable')
The rating downgrade reflects deterioration in the business and
financial risk profiles leading to stretched liquidity. Operating
profitability declined to 6.1% in fiscal 2016 from 8.2% in the
previous fiscal, leading to lower cash accrual that was barely
sufficient to meet repayment obligation. The decline was mainly
because of increasing competition in the construction chemicals
industry.
Key Rating Drivers & Detailed Description
Weaknesses
* Modest scale of operations: Operating income was INR26 crore in
fiscal 2016, an increase over INR18 crore in the previous fiscal.
The operating income is expected at INR28-30 crore in fiscal
2017.
* Large working capital requirement: Gross current assets (GCAs)
were 250 days as on March 31, 2016, but are likely to improve due
to adoption of a better inventory- and debtor-management policy;
this is reflected in GCAs of XX days as on December 31, 2016.
Strength
* Extensive experience of the promoters in the construction
chemicals industry: The promoters, Mr Parminder Kohli and his
brother, Mr Preetpal Singh Kohli, are civil engineers with around
20 years' experience in the construction industry. Their
extensive experience, understanding of market dynamics, and
established relationship with suppliers and customers enabled the
company to receive repeat orders.
Outlook: Stable
CRISIL believes RTPL will continue to benefit from the extensive
industry experience of its promoters. The outlook may be revised
to 'Positive' if the financial risk profile improves
significantly because of higher-than-expected revenue and
profitability, or substantial equity infusion. The outlook may be
revised to 'Negative' if profitability or revenue declines, or
the working capital cycle lengthens, leading to deterioration in
the financial risk profile.
RTPL was incorporated in June 2009, promoted by Mr Parminder
Kohli and his brother Mr. Preetpal Singh Kohli to take over the
business of Rheoplast Technology, a partnership firm set up in
2006. The company manufactures construction chemicals. Its
registered office is in Mumbai, and manufacturing units are in
Karnal, Haryana; Kolkata; and Navi Mumbai, Maharashtra.
For fiscal 2016, RTPL reported a profit after tax (PAT) of INR17
lakhs on an operating income of INR26.02 crores as against net
loss of INR4 lakhs on an operating income of INR18 lakhs in
fiscal 2015.
RIBBEL INTERNATIONAL: Ind-Ra Assigns BB- Long-Term Issuer Rating
----------------------------------------------------------------
India Ratings and Research (Ind-Ra) has assigned Ribbel
International Limited (Ribbel) a Long-Term Issuer Rating of
'IND BB-'. The Outlook is Stable.
KEY RATING DRIVERS
The ratings are constrained by Ribbel's small scale of operations
and stressed working capital cycle, due to its presence in a
highly fragmented and competitive industry. The company reported
revenue of INR193.23 million in FY16 (FY15: INR156.66 mil.) and
working capital cycle of 149 days (186 days).
The ratings are supported byRibbel's comfortable liquidity
position as evident by its average 94.58% working capital
utilization over the 12 months ended December 2016.
The ratings are further supported by company's strong operating
margins and credit metrics, because of a higher revenue
contribution from the value-added products. Operating margins of
the company were 17.95% in FY16 (FY15: 16.51%), gross interest
coverage (operating EBITDA/gross interest expense) was 2.14x
(2.02x), net financial leverage (total Ind-Ra adjusted net
debt/operating EBITDAR) was 4.35x (5.41x).
Moreover, Ribbel's promoters have a three-decade-long experience
in manufacturing high-precision surgical blades and Foley balloon
catheters business and the company has strong relationships with
its customers and suppliers.
RATING SENSITIVITIES
Negative: Deterioration in the net working capital or a decline
in its profitability margins leading to deterioration in overall
credit metrics will be negative for the ratings.
Positive: A significant improvement in the top line while
maintaining the current level of credit metrics would be positive
for the ratings.
COMPANY PROFILE
Ribbel was incorporated in 1992 and its registered office is in
New Delhi. The company manufactures high-precision surgical
blades and Foley balloon catheters. The company majorly exports
its products to the US, Russia, Europe, Germany and Saudi Arabia
etc. The company is promoted by Mr. R K Kanodia and Mrs. Suman
Kanodia.
SAGAR METALLICS: Ind-Ra Affirms 'BB-' Long-Term Issuer Rating
-------------------------------------------------------------
India Ratings and Research (Ind-Ra) has affirmed Sagar Metallics
Private Limited's (SMPL) Long-Term Issuer Rating at 'IND BB-'.
The Outlook is Stable.
KEY RATING DRIVERS
The affirmation reflects an improvement in SMPL's scale of
operations, along with continued weak credit metrics. In FY16,
SMPL's revenue grew to INR554 million (FY15: INR428 million)
owing to an increase in customers. Net leverage (total adjusted
net debt/operating EBITDAR) improved to 4.6x (FY15: 7.1x) due to
scheduled repayment of term loan, while EBITDA interest cover
(operating EBITDA/gross interest expense) remained stable at 1.8x
(1.8x).
The ratings are also constrained by the company's tight liquidity
position with almost full utilization of its fund-based working
capital facilities during the 12 months ended December 2016. The
ratings also factor in the risks associated with the commodity-
based manufacturing business.
However, the ratings are supported by improved EBITDA margin of
6.4% in FY16 (FY15: 5.6%) on account of a reduction in variable
expenses and the promoters more than a decade-long experience in
the yarn manufacturing business.
RATING SENSITIVITIES
Positive: Any substantial growth in the top line, along with an
improvement in the EBITDA margin leading to a sustained
improvement in the credit metrics could be positive for the
ratings.
Negative: Any deterioration in the EBITDA margin leading to a
sustained deterioration in the credit metrics could be negative
for the ratings.
COMPANY PROFILE
Established in 2009, SMPL manufactures and sells metallic yarn
and films to local wholesalers for saree designing, yarn
manufacturing and embroidery works.
SAKTHI TRADERS: Ind-Ra Assigns 'B' Long-Term Issuer Rating
----------------------------------------------------------
India Ratings and Research (India Ratings) has assigned Sakthi
Traders Shri Sakthi Hitech Agro Foodss (STSSHAF) a Long-Term
Issuer Rating of 'IND B'. The Outlook is Stable.
KEY RATING DRIVERS
The ratings reflect STSSHAF's weak credit profile due to high
short-term debt and low operating profitability. In FY16,
revenue was INR259.1 million (FY15: INR204.3 million), EBITDA
margins were 4.3% (4.4%), interest coverage (operating
EBITDA/gross interest expenses) was 1.3x (1.5x), net financial
leverage (total adjusted debt/operating EBITDA) was 4.9x (4.5x)
and short-term debt was INR53.2 million (INR28.9 million). The
margins are weak on account of the commoditized nature of raw
materials. Working capital cycle was long at 91 days in FY16
(FY15: 71 days).
The ratings, however, are supported by the firm's comfortable
liquidity position as evident from its 88% working capital
utilization during the 12 months ended January 2017. Moreover,
the firm's partners have an experience of around three decades in
the rice business.
RATING SENSITIVITIES
Positive: Substantial growth in the revenue and/or improvement in
the EBITDA margins leading to a sustained improvement in the
credit metrics will lead to a positive rating action.
Negative: A decline in the revenue and/or EBITDA margins leading
to sustained deterioration in the credit metrics could lead to a
negative rating action.
COMPANY PROFILE
STSSHAF was established in 1994 as a partnership firm and is
engaged in rice milling and processing paddy to produce rice,
rice bran and husk. The firm has a facility in Karaikudi (Tamil
Nadu).
SAMRUDDHA RESOURCES: ICRA Ups Rating on INR25cr Loan to B-
----------------------------------------------------------
ICRA has upgraded the long-term rating from [ICRA]D to [ICRA]B-
for the INR25.00 crore (reduced from INR30.00 crore) cash credit
facility of Samruddha Resources Limited. The outlook on the long-
term rating is 'Stable'. ICRA has withdrawn the short term rating
of [ICRA]D assigned to the INR3.00 crore non-fund based facility
of SRL as there is no amount outstanding against the rated
instruments.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Fund Based Limits 25.00 [ICRA]B- (Stable) upgraded
from [ICRA]D
Rationale
The revision of long-term rating takes into account improved
liquidity profile of the company in recent months, which has
resulted in regularisation of debt service obligations. The
rating also takes into account the expected increase in
profitability in the current year on the back of decline in port
charges and removal of export duty on sub 58% Fe grade ore. The
rating continues to draw comfort from the long experience of the
promoters in the iron ore mining business and the company's
comfortable capital structure on account of low debt levels.
The rating, however, is constrained by a sharp revenue de-growth
in FY2016 due to steep decline in iron ore prices and financial
support extended by the company to other group entities, which
adversely impacts SRL's financial risk profile. ICRA also notes
that the company remains exposed to risks arising from operating
in a highly regulated industry and to cyclicality inherent in
iron ore prices, which is likely to keep its cash flows volatile.
The rating also factors in high customer concentration risks as a
single customer accounted for almost half of SRL's total sales in
FY2016.
Any unanticipated increase in the financial support to the group
entities and ability to effectively manage working capital cycle
by reducing receivables remain the key rating sensitivities for
SRL.
Key rating drivers
Credit Strengths
* Improvement in liquidity profile in recent months, which
has resulted in regularisation of the debt service obligations
* Comfortable capital structure on account of low debt levels
* Decline in port charges and removal of export duty on sub 58%
Fe grade ore in the current year, which is likely to improve
profitability
* Long experience of the promoters in the iron ore mining
business
Credit Weakness
* Sharp revenue de-growth in FY2016 due to steep decline in
iron-ore prices
* Significant financial support extended by SRL to other group
entities, which adversely impacts its financial risk profile
* Risks arising from operating in a highly regulated industry
* Exposure to cyclicality inherent in iron ore prices, which
is likely to keep its cash flows volatile
* High customer concentration risk with a single customer
accounting for almost half of the total sales in FY2016
Description of key rating drivers highlighted above:
SRL carries out iron ore mining from its 32.5 hectare iron ore
mine located at Kalane village in Sindhudurg district of
Maharashtra and exports the same to China. The company curtailed
iron ore mining during FY2016 to reduce losses following steep
decline in iron ore prices. While sales volumes declined by 28%
in FY2016, realisations declined by around 50% during the same
period. ICRA notes that the reduction in export duty and decline
in freight expense would improve cost structure of the company in
the current fiscal. This, coupled with decline in port charges
from INR250 per MT to INR150 per MT from December 2016 following
transfer of control of port operations from Redi Port Limited to
Maharashtra Maritime Board would improve SRL's profitability.
Nonetheless, ICRA notes that significant financial support
extended by SRL to its group companies by way of equity
investments and interest-free unsecured loans adversely impacts
its financial risk profile. The company also remains exposed to
regulatory risks and to the cyclicality inherent in iron ore
prices.
Analytical approach: For arriving at the ratings ICRA has taken
into account the standalone financials of the company along with
key operational developments in the recent past.
Incorporated in 1997, Samruddha Resources Limited is involved in
mining and trading of iron ore fines. It carries out mining
operations from its 32.5 hectare iron ore mine located at Kalane
village in Sindhudurg district of Maharashtra. The mining lease
is owned by M/s Minerals and Metals, with whom SRL has entered
into an agreement to extract and sell iron ore fines. SRL also
has mining leases for five other mines in Sindhudurg district,
which are non-operational at present.
SRL recorded a net profit of INR1.8 crore on an operating income
of INR88.0 crore for the year ending March 31, 2016.
SARITA FORGINGS: Ind-Ra Assigns 'B+' Long-Term Issuer Rating
------------------------------------------------------------
India Ratings and Research (Ind-Ra) has assigned Sarita Forgings
Private Limited (SFPL) a Long-Term Issuer Rating of 'IND B+'.
The Outlook is Stable.
KEY RATING DRIVERS
The ratings reflect SFPL's small scale of operations and weak
credit metrics. The revenue for FY16 stood at INR332.6 million
(FY15: INR322.5 million; FY14: INR256.7 million), gross interest
coverage (operating EBITDA/gross interest expense) was 1.6x
(1.4x, 1.4x) and net financial leverage (adjusted net
debt/operating EBITDAR) was 6.1x (6.05x, 5.21x). The ratings
further reflect the company's moderate-to-low and volatile EBITDA
margins (FY16: 7.3%, FY15: 6.01%, FY14: 6.6%)
However, the ratings are supported by SFPL's comfortable
liquidity position as reflected in its around 87% average
utilization of the working capital limits in the 12 months ended
January 2017.
RATING SENSITIVITIES
Positive: Substantial revenue growth while maintaining or
improving the operating margins leading to a sustained
improvement in the credit metrics will be positive for the
ratings.
Negative: A dip in the operating margins leading to deterioration
in the credit metrics will be negative for the ratings.
COMPANY PROFILE
Established in 1996, SFPL manufactures all kinds of heavy steel
forgings in north India.
SESHSAYI FOODS: Ind-Ra Raises Long-Term Issuer Rating to 'BB+'
--------------------------------------------------------------
India Ratings and Research (Ind-Ra) has upgraded Seshsayi Foods
Private Limited's Long-Term Issuer Rating to 'IND BB+' from
'IND BB'. The Outlook is Stable.
KEY RATING DRIVERS
The upgrade reflects Seshsayi's continued improvement in credit
metrics due to strong revenue growth and scheduled debt
repayments. In FY16, net leverage (Ind-Ra adjusted net
debt/operating EBITDAR) was 4.6x (FY15: 5.3x; FY14: 16.5x) and
interest coverage (operating EBITDA/gross interest expense) was
1.3x (1.2x; 0.9x). The total debt reduced to INR514.8 million
(FY15: INR590.9 million; FY14: INR535 million). In FY16, revenue
increased to INR1,079 million in FY16 (FY15: INR910 million) on
account of a stable product demand owing to a strong brand name.
However, EBITDA margins slightly declined to 10.4% in FY16
(FY15: 12.2%; FY14: 5.3%) on account of fluctuations in raw wheat
prices.
The ratings remain constrained by the company's tight liquidity
position with its almost full use of the fund-based facilities
over the 12 months ended January 2017.
The ratings continue to be supported by the company's about
three-decade-long established brand Bambino under which it sells
its products and strong distribution network.
RATING SENSITIVITIES
Positive: Substantial growth in the revenue and/or EBITDA margin
leading to a sustained improvement in the credit metrics will
lead to a positive rating action.
Negative: A decline in revenue and/or EBITDA margin leading to
sustained deterioration in the credit metrics could lead to a
negative rating action.
COMPANY PROFILE
Established in 1981, Seshsayi is promoted by M Kishan Rao, whose
son M Subramanyam is the director. The company has a 35 tonnes
per day vermicelli manufacturing unit in Bhandara, Maharashtra
and a 300 tonnes per day wheat flour mill in Indore, Madhya
Pradesh. Seshsayi sells its products under the brand name Bambino
in the branded vermicelli market.
SHREE LAXMI: CARE Raises Rating on INR2.85cr Loan from B+
---------------------------------------------------------
The revision in the long-term rating assigned to the bank
facilities of Shree Laxmi Pulse Rice & Roller Flour Mills
takes into account the growth in scale of operations, improvement
in profit margins, capital structure and debt coverage indicators
along with liquidity position during FY16 (refers to the period
April 1 to March 31). The ratings, however, continue to remain
constrained on account of thin profitability, susceptibility to
fluctuations in raw material prices and highly regulated industry
coupled with fragmented nature of industry and low entry
barriers.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long-term Bank 2.85 CARE BB-; Stable
Facilities Revised from CARE B+
Long-term Bank 8.30 CARE BB-; Stable/CARE A4
Facilities/Short- Revised from CAREB+/CARE A4
term Bank Facilities
The ratings, however, continue to derive benefits from vast
experience of promoters. The ability of SLPM to increase its
scale of operations coupled with improvement in profitability and
capital structure along with efficient management of its working
capital requirements are the key rating sensitivities.
Detailed description of key rating drivers
SLPM's total operating income increased by 11.22% to INR64.13
crore as against INR57.66 crore during FY15 mainly on account of
increase in demand of the products by end user. The PBILDT margin
of SLPM improved by 58 bps and stood at 2.60% in FY16 as against
2.02% in FY15 mainly on account of lower procurement cost.
Consequently, PAT margin also improved but stood low at 0.72% for
FY16 as against 0.05% in FY15 mainly on account of improvement in
PBILDT and decline in depreciation expenses. Furthermore, GCA has
increased but remained low at INR0.66 crore as against INR0.25
crore during FY15.
Capital structure of SLPM improved and stood moderately
comfortable as reflected by an overall gearing ratio of 1.07
times as against 2.36 times as on March 31, 2015. The improvement
in capital structure was mainly on account of substantial
decrease in total debt as on March 31, 2016, due to lower working
capital utilization coupled with increase in net worth position
owing to accretion of profits to reserves. Interest coverage
ratio has improved and remained moderate at 1.66 times as against
1.28 times during FY15 due increase in PBILDT during FY16.
Furthermore, Total debt to GCA has also improved and remained
moderate at 5.20 times as on March 31, 2016, as against 25.83
times in FY15 on account of decrease in total debt substantially
coupled with increase in gross cash accruals.
Current ratio stood at 1.20x as compared with 1.08x as on
March 31, 2015. The working capital cycle has improved from 56
days during FY15 to 42 days during FY16 mainly on account of
improvement in the inventory period and collection period.
Furthermore, the gross current assets stood at 44 days which was
primarily funded through working capital borrowings. Cash flow
from operating activities has improved and stood at INR4.19
crore. The average working capital limit during past 12 months
ended December 2016 remained at 90%.
SLPM is Dahod-based partnership firm established in 1981. It is
mainly engaged in the processing and milling of various agro-
based products like Wheat Flour, Maida, Sooji, Rawa, Bran, etc,
with an installed capacity of 200 Metric Tonne per Day (MTPD) as
on March 31, 2016. The firm markets its products under brand name
'UgatoSuraj', 'Charminar', 'Double King' 'Apple' 'Strawberry' and
'Mango'. SLPM is promoted by Mr. Rameshchandra H Shah and Mr.
Kishanchandra H Shah holding 50% profit sharing ratio each in the
firm. In addition to this, the promoters of SLPM have interest in
the same line of business through their other business concerns,
Shree Balaji Pulses Mills based out at Dahod which is engaged in
trading of agro-based commodities.
As per the audited results for FY16, SLPM reported profit after
tax (PAT) of INR0.46 crore on a total operating income (TOI) of
INR64.13 crore as against net profit of INR0.03 crore on a TOI of
INR57.66 crore during FY15 (A).
SK AGARWAL: Ind-Ra Assigns 'BB' Long-Term Issuer Rating
-------------------------------------------------------
India Ratings and Research (Ind-Ra) has assigned S.K. Agarwal &
Co. (SKAC) a Long-Term Issuer Rating of 'IND BB'. The Outlook is
Stable.
KEY RATING DRIVERS
The ratings reflect SKAC's weak EBITDA margins, which averaged
1.92% over FY13-FY16, largely due to the trading nature of
operations. The margins have also remained volatile mainly on
account of fluctuation in steel prices. As per the provisional
1HFY17 results, EBITDA margins improved to 4.8% driven by a
steady rise in the steel prices following the imposition of
minimum import price in February 2016, along with the liquidation
of inventory stocked up at FYE16. Post demonetization, Ind-Ra
expects the margins to decline in the near term due to some
curtailment of demand, although remaining above the average
EBITDA margins earned over FY13-FY16.
The ratings are constrained by SKAC's moderate credit metrics
mainly on account of the weak profitability margins and working
capital intensity. Net leverage and gross coverage averaged
6.06x and 1.44x, respectively, over FY13-FY16. However, the
credit metrics improved substantially in 1HFY17, with interest
coverage and net leverage (annualized) of 3.29x and 2.73x,
respectively. However, the agency expects the credit metrics to
experience some moderation in the near term in line with the
expected decline in the EBITDA margins.
SKAC's average use of the sanctioned fund-based limits was 93%
during the 12 months ended December 2016. Also, the firm on an
average maintains a high inventory of close to 40 days; however,
it tends to fluctuate in response to market dynamics. In FY16,
inventory holding surged to 77 days due to stocking up at year-
end post the implementation of minimum import price. The firm
sells on both credit and advance basis, with a credit period of
not more than 20 days. Also, the supplier credit period extended
by its key suppliers such as Jindal Steel &Power Limited (JSPL)
and JSW Steel Limited (JSW, 'IND AA-'; Outlook Negative) remains
negligible.
The ratings, however, are supported by SKAC's large scale of
operations, with revenue growing at a CAGR of 30.3% over FY13-
FY16. Revenue growth rate has been fluctuating over the years in
response to market demand. In FY16, top line surged 81.4% yoy to
INR5.35 billion owing to the receipt of additional
distributorship of structural products from JSPL and cold-rolled
products by JSW, and initiation of imports. As per the 1HFY17
provisional results, SKAC achieved revenue of INR2.41 billion.
Ind-Ra expects sales to pick up in 2HFY17; however, the November
2016 demonetization could hamper revenue growth marginally.
The ratings are further supported by SKAC's diversified customer
base, with the top 10 customers accounting less than 16% of the
total sales in FY16. The company's philosophy of limiting
exposure to any single customer has facilitated the
diversification. To limit the payment default risk, the firm
mostly deals in cash with new customers and offers credit only
post the demonstration of a healthy payment track record, given
majority of its customers are traders and small manufacturers.
The ratings also benefit from the promoters' more than two
decades of experience in the trading business.
RATING SENSITIVITIES
Positive: An improvement in the profitability margins leading to
an improvement in the credit metrics on a sustained basis will be
positive for the ratings.
Negative: A decline in revenue and profitability margins,
resulting in a further deterioration in the credit metrics on a
sustained basis will be negative for the ratings.
COMPANY PROFILE
SKAC is a partnership firm engaged in the trading of steel
products such as mild steel plates, chequered plates, hot rolled
sheets and coils, cold rolled coils and structural steel
products. The firm is a distributor of JSW and JSPL for North
India.
SPECIALITY POLYMERS: CARE Downgrades Rating on INR45cr Loan to D
----------------------------------------------------------------
The revision in the ratings of Speciality Polymers Private
Limited takes in to account the ongoing delays in debt servicing
owing to strained liquidity position.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long-term/Short-
term Bank
Facilities 45.00 CARE D/CARE D Revised
from CARE BBB-/CARE A3
Long-term Bank
Facilities 13.50 CARE D Revised from
CARE BBB-
Short-term Bank
Facilities 37.10 CARE D Revised from CARE A3
Detailed description of the key rating drivers
The revision in ratings is on account of delays in debt
servicing.
Speciality Polymers Pvt. Ltd. is a Private limited Company
incorporated in 1988. The company manufactures chemicals which
cater to various industries like textiles, packaging, paper,
paint, construction, etc. The company is promoted by Mr.
Padmanabha Sharma and Mr. Sthanusesha Sharma both having more
than 25 years of experience in the business of chemical
manufacturing. SPPL manufactures various chemicals like synthetic
resin emulsions, adhesives, paint emulsions, textile binders,
paper coating binders, construction chemicals, etc. The company
caters to both the international and domestic market with the
domestic market contributing to 87% in the total operating income
for FY15.
The factory is located at MIDC Badlapur and Ambernath MIDC
(project under testing phase) with an annual capacity of
75,600 MTPA.
For FY16 (refers to the period April 1 to March 31), WECPL
reported PAT of INR4.05 crore on total income of INR278.45
crore as compared to PAT of INR5.23 crore on total income of
INR253.26 crore in FY15.
SREE PARIMALA: CARE Reaffirms B Rating on INR6.25cr LT Bank Loan
----------------------------------------------------------------
The rating assigned to the bank facilities of Sree Parimala
Cotton Ginning and Pressing Factory continues to be constrained
by modest scale of operations with low capitalization, low and
fluctuating profitability with limited value addition, moderate
solvency position, working capital intensive nature of operations
along with partnership nature of constitution.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long-term Bank
Facilities 6.25 CARE B; Stable Reaffirmed
The rating further remained constrained due to susceptibility of
profitability to fluctuation in raw material prices, seasonality
associated with availability of cotton, presence of entity in a
highly competitive and fragmented and susceptibility to adverse
government regulation.
The rating, however, continues to factor in the extensive
experience of the promoters along with long track record of
operations of firm and location advantage emanating from
proximity to raw material source.
The ability of the entity to increase its scale of operations,
improve its solvency position and profitability margins admist
intense competition and efficient management of working capital
requirement are the key rating sensitivities.
Detailed description of the key rating drivers
SPGPF's scale of operations remained at modest level with
declining total operating income and cash accruals during last
three years ending FY16 (refers to the period April 1 to March
31). The PBILDT margin of the entity stood low on account of high
cost of raw materials and limited value addition nature of
business along with high degree of competition and fragmentation.
Furthermore, the same are susceptible to fluctuation in raw
material prices i.e; raw cotton as the entity has to stock high
level of inventory owing to seasonal availability of the same
along with changing regulation by government for Minimum Support
Price (MSP) and quota for exports. Further owing to low tangible
networth and high dependence on external borrowings capital
structure remained leveraged. However, the entity benefits from
it being located in cotton-producing belt of Marathwada
(Maharashtra) resulting to lower logistic expenditure and
proximity to clients as well.
The entity is spearheaded by Mr. B. Maulali, Mr. B. Ramanna, Mrs
K. J Shobha and Mrs K. Sree Laxmi have an individual experience
of more than one and half decades, respectively, in the cotton
ginning industry, through association with group entities engaged
in similar segment.
Beed-based (Maharashtra), SPGPF was established as a partnership
firm on July 25, 2003, with 4 partners sharing profit and loss
unequally. SPGPF is engaged in business of cotton ginning,
pressing and trading of ginned cotton and cotton seeds.
The firm procures raw cotton directly from local farmers and has
an installed capacity of processing 22000 MTPA of cotton bales
from raw cotton. Its manufacturing unit is located in Village
Bhopa Dist: Beed, Maharashtra. Shri Guru Raghvendra Cotton
Ginning and Pressing Factory (SGRCGP), Laxmi Venkatesh Ginning
and Pressing Factory (LVGPF) are the associate concerns of SPGPF,
are engaged in the same business as SPGPF.
In FY16, the entity registered a total operating income of
INR21.65 crore and profit after tax of INR0.32 crore.
STOLT RAIL: CRISIL Reaffirms B+ Rating on INR9.2MM LT Loan
----------------------------------------------------------
CRISIL has reaffirmed its rating on the long-term bank facility
of Stolt Rail Logistic Systems Limited at 'CRISIL B+/Stable', and
has reassigned a rating of 'CRISIL A4' to the short-term bank
facilities.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Bank Guarantee 2 CRISIL A4 (Reassigned)
Overdraft 1 CRISIL A4 (Reassigned)
Proposed Long Term
Bank Loan Facility 9.25 CRISIL B+/Stable (Reaffirmed)
Short Term Loan 4.00 CRISIL A4 (Reassigned)
Proposed Overdraft
Facility 2.00 CRISIL B+/Stable (Reaffirmed)
The ratings reflect SRLSL's modest scale of operations and the
customer concentration in its revenue profile. These weaknesses
are partially offset by the extensive experience of the promoters
in the logistics industry.
Key Rating Drivers & Detailed Description
Strengths
* Modest scale of operations:
Revenue modest at INR15.55 crore in fiscal 2016 is expected to
improve in the near term supported by stabilisation of operations
post capital expenditure (capex) coupled with new customer
additions. Revenue was at INR25 crore in the first nine months
ended December 2016.
* Customer concentration risk:
Customer concentration risk is high as the top two customers
account for 90% of revenue. In the absence of a diversified
customer base, any pressures faced by the customers or a change
in their procurement/logistics policy can translate to off-take
risks for SRLSL thereby affecting its credit profile.
Strengths
* Extensive experience of promoters:
SRLSL leverages on the extensive experience of its promoters in
the logistics industry. Over the years, the promoters have gained
a sound understanding of the market and establish healthy
relationships with customers and suppliers. This is expected to
help the company maintain a stable business risk profile over the
medium term.
Outlook: Stable
CRISIL believes SRLSL will continue to benefit from the extensive
industry experience of its promoters. The outlook may be revised
to 'Positive' if improvement in revenue and profitability lead to
high cash accrual. The outlook may be revised to 'Negative' if
decline in revenue or profitability or large debt-funded capex
weakens liquidity.
SRLSL, incorporated in 2001, is a third-party rail logistics
provider for liquid cargo movement and storage. It owns liquid
tank containers and storage terminals. The company commenced
commercial operations in February 2013 and its storage tanks are
at Butibori in Nagpur and Daund in Pune (Maharashtra).
SRLSL has reported a net loss of INR 4.54 crore on net sales of
INR 15.55 crore for fiscal 2016, against a net profit of INR 0.02
crore on net sales of INR 18.42 crore for the previous year.
TECHNO TRAK: Ind-Ra Lowers Long-Term Issuer Rating to 'B+'
----------------------------------------------------------
India Ratings and Research (Ind-Ra) has downgraded Techno Trak
Engineers' (TTE) Long-Term Issuer Rating to 'IND B+' from
'IND BB-'. The Outlook is Stable.
KEY RATING DRIVERS
The downgrade reflects a deterioration in TTE's credit profile.
Revenue declined to INR97.4 million in FY16 from INR492.1 million
in FY15 mainly due to a slowdown in the oil and gas sector.
Consequently, interest coverage (operating EBITDA/gross interest
expense) decreased to 2.1x in FY16 (FY15: 4.5x) and net financial
leverage (total adjusted net debt/operating EBITDA) deteriorated
to 4.5x (2.5x). However, EBITDA margin improved to 21.9% in FY16
from 8.4% in FY15 due to subdued raw material prices and various
cost-cutting measures implemented by the firm. Also, net working
capital cycle elongated to 478 days in FY16 from 50 days in FY15,
owing to high inventory holding due to a lower number of the
orders executed and delayed receivables.
The rating, however, are supported by TTE's comfortable liquidity
position. The company utilised fund-based facilities at an
average of 66% over the 12 months ended December 2016.
The ratings are further supported by over two decades of
experience of the firm's partners in manufacturing couplings and
pup joints.
RATING SENSITIVITIES
Negative: A sustained decline in EBITDA margin or a further
elongation in the working capital cycle leading to a further
deterioration in credit metrics could be negative for the
ratings.
Positive: A substantial increase in the revenue while maintaining
EBITDA margin leading to an improvement in credit metrics could
be positive for the ratings.
COMPANY PROFILE
Formed in in 1986, TTE is a Maharashtra-based partnership concern
that manufactures couplings and pup joints, which are majorly
used in the petroleum industry.
TIRUPATI STARCH: Ind-Ra Assigns 'BB' Long-Term Issuer Rating
------------------------------------------------------------
India Ratings and Research (Ind-Ra) has assigned Tirupati Starch
& Chemicals Limited. (TSCL) a Long-Term Issuer Rating of 'IND
BB'. The Outlook is Stable.
KEY RATING DRIVERS
The rating reflects TSCL's moderate scale of operations and
moderate credit metrics. Revenue increased to INR1,581 million
in FY16 (FY15: INR559 million), driven by a rise in sales.
Revenue and operating margin were INR874.4 million and 5.6% in
1HFY17, respectively. Net financial leverage (total adjusted
net debt/operating EBITDAR) increased to 8.6x in FY16 (FY15:
8.1x), driven by an increase in short-term borrowings, and
interest coverage (operating EBITDA/gross interest expense) fell
to 1x (3.2x), led by a decline in operating margin to 3.8%
(7.3%) due to an increase in raw material costs.
The ratings were constrained by TSCL's tight liquidity position.
The company's utilization of working capital limits was over 98%
during the 12 month ended December 2016.
However, the ratings are supported by low customer concentration,
as the top 10 customers accounted for less than 35% of revenue in
FY16, and a strong customer base, including Bilt Graphic Paper
Products Limited ('IND BBB-'/RWN); Fresenius Kabi India Private
Limited, ITC Ltd and GlaxoSmithKline Consumer Healthcare Ltd.
The ratings are also supported by the agency's expectations of an
improvement in its scale of operations, given the company has
started manufacturing more modified starch such as acid-test
starch, oxidised starch, carboxymethylated starch and cationic
starch.
RATING SENSITIVITIES
Negative: Any deterioration in credit metrics will be negative
for the ratings.
Positive: A sustained improvement in credit metrics could lead to
positive rating action.
COMPANY PROFILE
Incorporated in 1985, TSCL is primarily engaged in the wet
milling of maize corn for manufacturing unmodified/modified
starch and other by-products (such as maize corn germs, grits and
gluten) for the textile, food, pharmaceuticals, chemical paper,
poultry and other industries in India and abroad. It is an ISO
9001:2008 certified company and a renowned corn starch
manufacturer in central India.
UNIJULES LIFE: CRISIL Reaffirms D Rating on INR124.5MM Cash Loan
----------------------------------------------------------------
CRISIL has been consistently following up with Unijules Life
Sciences Ltd for getting information. CRISIL requested
cooperation and information from the issuer through its letters
and emails dated August 24, 2016, October 10, 2016, November 08,
2016 and January 20, 2017 among others, apart from telephonic
communication. However, the issuer has continued to be non-
cooperative.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Bank Guarantee 6.5 CRISIL D/Issuer Not
Cooperating (Rating
Reaffirmed; Issuer Not
Cooperating)
Cash Credit 124.5 CRISIL D/Issuer Not
Cooperating (Rating
Reaffirmed; Issuer Not
Cooperating)
Letter of Credit 5.75 CRISIL D/Issuer Not
Cooperating (Rating
Reaffirmed; Issuer Not
Cooperating)
Letter of credit 12.75 CRISIL D/Issuer Not
& Bank Guarantee Cooperating (Rating
Reaffirmed; Issuer Not
Cooperating)
Term Loan 61.50 CRISIL D/Issuer Not
Cooperating (Rating
Reaffirmed; Issuer Not
Cooperating)
Please note that the rating(s) are based on best available
information with the credit rating agency: the entity whose debt
is being published via this press release did not provide the
requisite information needed to conduct the rating exercise and
is therefore classified as 'non-cooperative'.
Detailed Rationale
CRISIL's ratings on the bank facilities of Unijules continue to
reflect instances of delay by the company in meeting its debt
obligations. The delay has been caused by weak liquidity.
CRISIL believes Unijules's liquidity will remain weak over the
near term on account of time required for stabilisation of
operations and large working capital requirement, as well as
significant exposure to tender-driven sales.
Key Rating Drivers & Detailed Description
Weaknesses
* Delays in servicing term debt due to weak liquidity: Unijules
has delayed its repayments towards bank loans.
* Working capital-intensive operations: About three-fourths of
the revenue is tender-based, leading to large receivables of over
three months. Revenue depends highly on institutional sales -
tender-based sales to government and affiliated institutions.
Ability to consistently meet qualifying requirements, quote
competitive prices, and deliver on time are crucial in tender-
based business, which involves strict penalties (including
blacklisting). Also, revenue in tender business is sporadic,
especially in case of bulk contracts.
Strength
* Multiple revenue streams with presence in herbal and allopathic
segments
Unijules has a sizeable product portfolio, with presence in the
herbal and allopathic segments. Its products include hair, face,
foot, body, and general beauty care products; phytochemicals;
balms and gels; and diet supplementary products.
Unijules was established in 2006, when the business of H Jules &
Company Ltd was transferred to it and when Unijules had also
acquired all the assets of Universal Medicaments Pvt Ltd.
Unijules, promoted by Mr Faiz Vali, manufactures and markets
herbal and allopathic drugs.
====================
N E W Z E A L A N D
====================
WINDFLOW TECHNOLOGY: Chief Financial Officer Steps Down
-------------------------------------------------------
The Board of Windflow Technology Limited advises that Mr. Angus
Napier, the Company's Chief Financial Officer, has resigned for
personal and family reasons and will leave the Company on
Feb. 17, 2017.
As reported in the Troubled Company Reporter-Asia Pacific on
Nov. 3, 2016, Stuff.co.nz said Windflow Technology averted an NZX
threat to suspend share trading when it finally published its
annual report on Nov. 2, 2016. Founder Geoff Henderson, based in
Christchurch, said auditors had made additional queries and there
was "no drama". However, KPMG auditors said the company's future
depended on major shareholder and funder David Iles, further
sales of turbines in the UK, licensing revenue, more finance, or
equity from shareholders. According to Stuff.co.nz, KPMG said
"multiple uncertainties" meant there was insufficient evidence to
provide an audit opinion on the financial statements.
Christchurch, New Zealand-based Windflow Technology Limited --
http://www.windflow.co.nz/-- is engaged in the development and
manufacture of wind turbines. The Company's wholly owned
subsidiaries include, Wind Blades Ltd, Pacific Windfarms Ltd and
Windflow Hawaii Ltd. The Company has one customer, NZ Windfarms
Ltd. Wind Gears Ltd is owned 50% by Windflow Technology Limited.
Wind Gears Ltd is engaged in the development and construction of
gear boxes for the wind turbines. Windpower Otago Ltd is owned
20% by the Company.
WYNYARD GROUP: Placed Into Liquidation
--------------------------------------
On Feb. 8 at the Watershed Meeting, held as part of the Voluntary
Administration requirements for Wynyard Group Limited, the
creditors resolved to place the company into liquidation.
KordaMentha partners Grant Graham and Neale Jackson are the
Liquidators of the company.
The company's subsidiary, Wynyard (NZ) Limited was also placed
into liquidation by its creditors, with Messrs. Graham and
Jackson being appointed as liquidators.
The Liquidators will provide further reports to creditors, as
required pursuant to the Companies Act 1993, which will be
available on the Companies Office website at the relevant times.
Shareholders should bear in mind that section 248(1)(d) of the
Companies Act prohibits any transfer of shares in Wynyard Group
Ltd without the approval of the Court.
About Wynyard Group
Based in Auckland, New Zealand, Wynyard Group Limited (NZE:WYN)
-- https://www.wynyardgroup.com/ -- provides software and
solutions to help protect companies and countries from threat,
crime and corruption. The Company has designed and developed
software to operate and connect three mission cycles: Risk
Management, Intelligence and Investigations. Wynyard products and
solutions are used by fortune 500 companies, national security
agencies and critical infrastructure operators across government,
financial services and infrastructure sectors. The Company
provides consulting and bureau services to government agencies
and financial institutions engaged in software to help protect
companies and countries from threat, crime and corruption. The
Company's solutions include risk management, intelligence,
investigations and digital forensics.
On Oct. 26, Wynyard Group Limited was placed into voluntary
administration (VA), along with its trading subsidiary Wynyard
NZ. KordaMentha partners, Grant Graham and Neale Jackson were
appointed Administrators. The Administrators have taken full
control of the company.
KordaMentha partner and Wynyard Group Administrator, Mr. Graham
said the company has effectively exhausted its options to secure
its working capital needs.
=====================
P H I L I P P I N E S
=====================
CHINA BANKING: Fitch Affirms IDRs at BB+; Outlook Stable
--------------------------------------------------------
Fitch Ratings has affirmed the Long-Term Issuer Default Ratings
(IDRs) on six privately owned Philippine banks. The banks are:
- Bank of the Philippine Islands (BPI),
- BDO Unibank, Inc. (BDO),
- Metropolitan Bank & Trust Company (Metrobank),
- China Banking Corporation (CBC),
- Philippine National Bank (PNB), and
- Rizal Commercial Banking Corp. (RCBC).
The ratings are all on Stable Outlook. A full list of rating
actions is at the end of this rating action commentary.
KEY RATING DRIVERS
VIABILITY RATINGS, IDRS AND NATIONAL RATINGS
BPI, BDO and Metrobank are the three largest banks in the
Philippines by assets. Their Viability Ratings (VRs) and IDRs -
and the National Ratings of BPI and BDO - reflect their strong
domestic franchises, diverse revenue streams and adequate risk-
management frameworks, which help to underpin their steady asset
quality, above-average profitability and healthy balance sheet
buffers. BPI's ratings also give credit for its historically
prudent risk appetite, and superior profitability, and funding
and liquidity metrics.
CBC, PNB and RCBC are among the 10 largest banks in the
Philippines with more moderate market shares of around 3%-6% by
loans, assets and deposits. These banks have generally shown a
greater appetite for growth in recent years as they seek to gain
scale and share, but Fitch expects that they will display broadly
stable asset quality and profitability backed by acceptable risk
controls as they grow.
Fitch expects the Philippines' GDP growth to remain robust in the
next one to two years, backed by resilient domestic consumption
and investment activity. Headwinds for overseas remittances and
business-process outsourcing revenues - two important drivers of
domestic consumption - may rise, but Fitch still expect both
inflow streams to remain broadly resilient for now in the absence
of more pronounced and immediate threats.
The current government's plans to accelerate infrastructure
spending should provide an added boost to domestic activity, and
the authorities retain adequate policy flexibility to offset a
weakening in economic conditions or greater financial market
volatility. Fitch expects credit growth in the mid- to high-teens
against this backdrop.
Philippine banks' asset quality has generally improved amid the
favourable economic backdrop over the last several years. Fitch-
calculated gross NPL ratios for the banks in this peer group have
fallen to 1.0%-2.5% at end-2015 from 2.9%-8.1% at end-2010, and
the ratios remained broadly stable in 2016. NPA ratios and NPL
coverage ratios have similarly improved in tandem.
One exception is CBC, which has experienced some asset-quality
weakness over the last 2-3 years due to the acquisition of a
weaker bank and various operational issues. Its reported NPL
ratio rose to a high of 2.6% at end-June 2016 (end-2013: 2.0%),
but eased to 2.4% at end-September as it worked through its
problem loans. CBC's reported NPL coverage ratio deteriorated to
around 87% at end-September 2016 from 147% at end-2013, but the
ratio has been improving in recent quarters. Fitch continues to
monitor these trends and also take into account CBC's
historically sound asset-quality performance and conservative
culture in Fitch assessment.
The profitability of the three largest banks is generally better
than that of the mid-tier banks. Fitch attributes this to their
greater scale and more diverse business models - they have
broader recurring non-interest income streams. In contrast,
trading gains have comprised a larger share of the revenues of
PNB and RCBC on average over the past few years. This share has
declined more recently relative to the highs in 2012, and Fitch
expects both banks to continue to emphasise recurring revenue
generation in the medium term.
PNB's profitability is also hampered by its larger stock of
legacy unproductive assets and higher cost base as it has yet to
capture the full synergies from its acquisition of Allied Bank in
2013. The bank plans to roll out its integrated core banking
platform in 2017, which could help enhance its cost efficiency -
and potentially its profitability - in the medium term.
Capitalisation, funding and liquidity remain healthy for the
banks in this peer group. Their Fitch Core Capital and regulatory
CET1 ratios continue to indicate adequate loss-absorption
capacity. In particular, BDO's buffers have been strengthened
after its PHP60bn stock rights offer in January - which Fitch
estimates would have increased its capitalisation buffers by
about 3.5% of risk-weighted assets on a pro-forma basis.
Internal capital generation is often insufficient to support the
robust growth plans of many of the banks, and they periodically
raise fresh capital to maintain adequate buffers above regulatory
requirements - which are rising for domestic systemically
important banks in the Philippines. Fitch expects CET1 hurdles
for banks in this peer group to rise to 10%-11% by January 2019
from 8.5% in 2016. To this end, the banks generally benefit from
their ownership by financially strong family/conglomerate
shareholders, which have historically provided ordinary capital
support when needed - although such links also raise
concentration and contagion risks within the financial system,
which require close monitoring by the authorities.
The banks' healthy funding and liquidity positions stem from the
liquid domestic financial system (as indicated by the end-2016
system-wide loan/deposit ratio of around 72%, based on the
central bank's measure), and their mostly deposit-funded balance
sheets. The banks have raised more low-cost current and savings
account deposits in recent years, which helped to lower their
overall funding costs.
Fitch expects liquidity conditions to tighten gradually, driven
by external market factors as well as continued brisk system
credit growth. However, system liquidity should remain adequate
given the significant pool of funds currently held with the
central bank that can be released to meet demand when required.
The Stable Outlooks reflect Fitch's view that the banks' credit
profiles are likely to remain broadly steady over the next one to
two years.
SUPPORT RATINGS AND SUPPORT RATING FLOORS
The Support Ratings (SRs) and Support Rating Floors (SRFs) are
based on Fitch's expectation of a moderate likelihood of
extraordinary state support for the banks, if needed.
BPI, BDO and Metrobank - as the three largest banks in the
Philippines - are likely to be of high significance to the
domestic financial system, suggesting a high sovereign propensity
to provide extraordinary support to these three banks, if needed.
Fitch believes the mid-tier banks - CBC, PNB and RCBC - are also
systemically important, albeit somewhat less so than their larger
peers.
Our assessment of sovereign support for the privately owned banks
in this peer group also take into account the sovereign's ability
to provide such support in times of stress, based on its
financial position as incorporated in its 'BBB-' IDRs, currently
on Positive Outlook.
MEDIUM-TERM NOTE PROGRAMME AND SENIOR DEBT
The ratings on RCBC's medium-term note programme and the senior
notes of BDO and RCBC are at the same level as their respective
Long-Term IDRs. This is because the notes constitute direct,
unsubordinated and unsecured obligations of the bank, and rank
equally with all their other unsecured and unsubordinated
obligations.
RATING SENSITIVITIES
VIABILITY RATINGS, IDRS AND NATIONAL RATINGS
Positive rating action could result from a continued improvement
in the overall operating environment, including sustained
economic growth, rising overall incomes and further strengthening
in regulatory, governance and risk frameworks. This is assuming
that such trends translate to healthier asset quality and
earnings performance, and that the banks maintain their current
capitalisation, funding and liquidity strengths.
Negative action may occur if rapid asset growth leads to material
strains on the banks' risk and operational controls, or their
financial profiles. A further rise in loan concentration and more
prominent signs of a potential credit bubble would also place
pressure on the ratings.
SUPPORT RATINGS AND SUPPORT RATING FLOORS
The Support Ratings (SRs) and Support Rating Floors (SRFs) are
sensitive to any perceived changes in the sovereign's propensity
or ability to provide extraordinary support in times of need. A
sustainable improvement in the sovereigns' finances - which may
be indicated by a sovereign rating upgrade - could lead to
positive action on the SRs and/or SRFs.
MEDIUM-TERM NOTE PROGRAMME AND SENIOR DEBT
The programme and senior note ratings would move in tandem with
their individual banks' Long-Term IDRs.
The rating actions are:
BPI
- Long-Term Foreign- and Local-Currency IDRs affirmed at 'BBB-';
Outlooks Stable
- Short-Term Foreign-Currency IDR affirmed at 'F3'
- National Long-Term Rating affirmed at 'AAA(phl)'; Outlook
Stable
- Viability Rating affirmed at 'bbb-'
- Support Rating affirmed at '3'
- Support Rating Floor affirmed at 'BB+'
BDO
- Long-Term Foreign- and Local-Currency IDRs affirmed at 'BBB-';
Outlooks Stable
- Short-Term Foreign-Currency IDR affirmed at 'F3'
- National Long-Term Rating affirmed at 'AA+(phl)'; Outlook
Stable
- Viability Rating affirmed at 'bbb-'
- Support Rating affirmed at '3'
- Support Rating Floor affirmed at 'BB+'
- Ratings on senior notes affirmed at 'BBB-'
Metrobank
- Long-Term Foreign- and Local-Currency IDRs affirmed at 'BBB-';
Outlooks Stable
- Short-Term Foreign-Currency IDR affirmed at 'F3'
- Viability Rating affirmed at 'bbb-'
- Support Rating affirmed at '3'
- Support Rating Floor affirmed at 'BB+'
CBC
- Long-Term Foreign- and Local-Currency IDRs affirmed at 'BB+';
Outlooks Stable
- National Long-Term Rating affirmed at 'AA-(phl)'; Outlook
Stable
- Viability Rating affirmed at 'bb+'
- Support Rating affirmed at '3'
- Support Rating Floor affirmed at 'BB-'
PNB
- Long-Term Foreign-Currency IDR affirmed at 'BB+'; Outlook
Stable
- Short-Term Foreign-Currency IDR affirmed at 'B'
- National Long-Term Rating affirmed at 'AA-(phl)'; Outlook
Stable
- Viability Rating affirmed at 'bb+'
- Support Rating affirmed at '3'
- Support Rating Floor affirmed at 'BB-'
RCBC
- Long-Term Foreign- and Local-Currency IDRs affirmed at 'BB+';
Outlooks Stable
- Viability Rating affirmed at 'bb+'
- Support Rating affirmed at '3'
- Support Rating Floor affirmed at 'BB-'
- Ratings on medium-term note programme and senior notes
affirmed at 'BB+'
DEVELOPMENT BANK: Fitch Affirms LT IDR at BB+; Outlook Positive
---------------------------------------------------------------
Fitch Ratings has affirmed the Long-Term Issuer Default Ratings
(IDRs) on two Philippine government-owned banks - Development
Bank of the Philippines (DBP) and Land Bank of the Philippines
(LBP) - at 'BB+'. The Outlooks on the Long-Term IDRs remain
Positive, reflecting the Outlook on the Philippines' sovereign
rating.
KEY RATING DRIVERS
IDRS, NATIONAL RATINGS, SUPPORT RATINGS AND SUPPORT RATING FLOORS
The IDRs and National Ratings of DBP and LBP reflect Fitch's
expectation of extraordinary sovereign support for both banks in
times of need, as denoted by their Support Ratings (SRs) of '3'
and Support Rating Floors (SRFs) of 'BB+'. The SRFs are one notch
below the sovereign Long-Term IDRs and in line with those of the
top-three systemically important banks in the Philippines.
Fitch believes that the sovereign would have a strong propensity
to provide extraordinary support to DBP and LBP, if needed, given
their full government ownership and policy mandates as described
in their respective charters. The probability of state support is
assessed to be moderate overall, taking into account the
sovereign's financial strength as indicated in the sovereign IDR
of 'BBB-'.
DBP and LBP do not benefit from blanket government guarantees on
their liabilities, have received capital support from the state
only infrequently on an ad hoc basis and are required to remit
dividends to the national government to support the sovereign
coffers. These characteristics indicate the two banks' self-
sufficient operations, stemming from their largely commercial
approach to lending, in Fitch views.
The Positive Outlooks on the two banks' IDRs are driven by the
Positive Outlook on the Philippines' Long-Term IDR, especially to
the extent that it reflects improving sovereign fiscal
flexibility.
VIABILIY RATINGS
The Viability Ratings (VRs) of DBP and LBP stem from their
standalone credit profiles. Fitch believes both banks'
commercially driven operations underpin their acceptable through-
cycle asset-quality performance and profitability even as they
fulfil their individual policy roles. The 2015 ratio of pre-
provision operating profit to risk-weighted assets for DBP was
2.4% and for LBP was 2.8%, which were comparable to those of
privately owned peers. LBP, in particular, has demonstrated
relatively healthy asset-quality trends, with a Fitch-defined
gross NPL ratio of 1.5% at end-2015 (end-2014: 1.9%).
The ratings also take into account the banks' highly concentrated
loan books, which may leave them vulnerable to deterioration in
any large accounts. For LBP, its exposure to the agricultural
sector could also be affected by natural calamities. Fitch
believes these risks are mitigated by the banks' loan
collateralisation and loss absorption buffers.
Regulatory CET1 ratios for DBP and LBP rose to 12.4% and 11.6%,
respectively, at end-September 2016 (end-2015: 10.2% for DBP;
10.0% for LBP). This followed capital transfers from the national
government to both banks in 2016. These ratios indicate
acceptable loss-absorption capacity in Fitch views, and Fitch
expects both banks to maintain satisfactory buffers over
regulatory minimums in the medium term.
Funding and liquidity are relative strengths for DBP and LBP,
despite their higher deposit concentration in government-linked
accounts. Both banks are predominantly deposit-funded;
loan/deposit ratios are low (DBP: 52%; LBP: 40% at end-2015), and
non-loan assets are mostly held in cash, central bank deposits
and government securities. Both banks benefit from the ability to
access Official Development Assistance funding, which are
guaranteed by the government for a fee - due to their state
links.
SENIOR DEBT
The ratings on DBP's senior notes are at the same level as the
bank's Long-Term IDR. This is because the notes constitute
direct, unsubordinated and unsecured obligations of the bank, and
rank equally with all its other unsecured and unsubordinated
obligations.
RATING SENSITIVITIES
IDRS, NATIONAL RATINGS, SUPPORT RATINGS AND SUPPORT RATING FLOORS
Perceived changes in the sovereign's propensity or ability to
extend timely support to DBP and LBP would affect the support-
driven ratings.
Positive action may result from a more pronounced policy focus by
the banks, or more unequivocal indications of support from the
national government.
The planned merger between DBP and LBP, mandated under the
previous administration, will no longer go through under the
current government. This removes one area of uncertainty
regarding the potential structure and operations of the two
banks.
A reduction in the government shareholding in either bank could
affect the sovereign's propensity to provide support to that
bank. For LBP, the Republic Act 10878 that became law by default
in mid-2016 allows the issuance of common and preferred shares to
non-government shareholders, such as farmer and fisher-folk
organisations, cooperatives, development partners, strategic
investors and rural banks, although it requires that the national
government maintains at least two-thirds ownership of LBP's
common shares. Fitch will reassess the likelihood of support for
LBP if there is more concrete news of any reduction in the
government's stake.
An upgrade of the sovereign ratings - currently on Positive
Outlook - would likely lead to similar action on DBP's and LBP's
SRFs, and in turn their IDRs. Conversely, a revision of the
sovereign Outlook to Stable would likely result in corresponding
action on the rating Outlooks of the two banks - assuming that
all other factors driving sovereign support remain unchanged.
VIABILITY RATINGS
There is limited room for VR upgrades of DBP and LBP unless they
were to de-emphasise their policy roles. This is due to the risk
that their policy priorities may impinge on their commercial
orientation at some point, possibly as a result of government
influence given the banks' state ownership.
Significant credit deterioration, resulting in weakened balance
sheets, would place pressure on the banks' VRs.
SENIOR DEBT
Any change in DBP's Long-Term IDR would affect the ratings on its
senior notes.
The rating actions are:
DBP
Long-Term Foreign-Currency IDR affirmed at 'BB+'; Outlook
Positive
Short-Term Foreign-Currency IDR affirmed at 'B'
Long-Term Local-Currency IDR affirmed at 'BB+'; Outlook Positive
National Long-Term Rating affirmed at 'AA+(phl)'; Outlook Stable
Viability Rating affirmed at 'bb+'
Support Rating affirmed at '3'
Support Rating Floor affirmed at 'BB+'
Ratings on senior notes affirmed at 'BB+'
LBP
Long-Term Foreign-Currency IDR affirmed at 'BB+'; Outlook
Positive
Short-Term Foreign-Currency IDR affirmed at 'B'
Long-Term Local-Currency IDR affirmed at 'BB+'; Outlook Positive
National Long-Term Rating affirmed at 'AA+(phl)'; Outlook Stable
Viability Rating affirmed at 'bb+'
Support Rating affirmed at '3'
Support Rating Floor affirmed at 'BB+'
====================
S O U T H K O R E A
====================
KOREAN AIR: Near-1,000% Debt Level to Worsen as Won Seen Weak
-------------------------------------------------------------
Bloomberg News reports that Korean Air Lines Co. ended last year
with a credit rating downgrade and debt-to-equity ratio
approaching 1,000 percent -- the worst among Asian full-service
carriers. Investors of the money-losing airline face an even
bleaker 2017 as a weaker won raises the cost of repaying foreign
debt, Bloomberg says.
The Korean currency is projected to weaken around 7 percent
against the dollar by December, according to the median of
forecasts in a Bloomberg survey of analysts. Korean Air's foreign
currency debt accounts for more than 70 percent of total
borrowings, Bloomberg notes.
Korean Air had KRW14.72 trillion ($13 billion) in total
borrowings as of September, Bloomberg discloses citing the latest
company disclosure. Of the total debt, 62.5 percent is in dollars
and 11.9 percent in other foreign currencies.
Around $589 million of the Korean flag carrier's U.S.-dollar
loans come due this year, according to Bloomberg-compiled data.
Total borrowings at smaller rival Asiana Airlines Inc. stood at
KRW4.43 trillion at the end of 2016, 51.8 percent of which is in
foreign currencies, Bloomberg relates citing company filings.
Asiana and Korean Air both face the prospect of credit rating
cuts this year, Bloomberg says citing Korea Investors Service,
the local affiliate of Moody's Investors Service. Korean Air's
debt-to-equity level stood at about 917 percent as of the quarter
ended Sept. 30, based on company filings. It could "have easily
gone over 1,000 percent" by the fourth quarter, said Kim Bong-
kyun, an evaluation team manager at Korea Ratings, a local
affiliate of Fitch Ratings, Bloomberg relays.
"The operating environment is likely to become less favorable
this year, and airlines will find it even more difficult to ease
their debt burdens," Bloomberg quotes Kim Jung-hoon, an analyst
at Korea Investors Service, as saying. "We are seeing more
reasons for downward credit rating revisions," he said in an
interview in January.
Korean Air's leverage ratio trails only Air Canada among full-
service airlines worldwide, according to data compiled by
Bloomberg. Together with Asiana, they are among the most indebted
among Asian full-service carriers, the data show.
Last month, Korean Air said it plans to issue KRW450 billion of
new shares to be used for working capital, Bloomberg recalls. It
didn't proceed with an earlier plan to sell around $100 million
of 30-year bonds not callable for three years in September.
Korean Air currently has no fundraising plan apart from rights
issue, and is working to address its debt problems, said a
company official who declined to be identified, citing the
carrier's policy, adds Bloomberg.
Bloomberg adds that the rights offer plan is positive for Korean
Air's cash flows but likely won't be enough to significantly ease
the carrier's worsening financial structure due to expected net
losses for the year ended December, Korea Investors Service said
in a report last month.
About Korean Air
Headquartered in Seoul, South Korea, Korean Air Lines Co. Ltd.
-- http://kr.koreanair.com/-- is a Korea-based company engaged
in the passenger airline transportation business. Its principal
activities consist of the provision of domestic and
international airline services; the production of aircraft,
including military aircraft; the provision of aircraft
maintenance and engineering services, and the sale of duty-free
goods. Korean Air Lines offers four classes of service: Economy
Class, Business Class, First Class and Premium Class, and
provides in-flight services, including cabin crew, in-flight
entertainment, meal and other services. It is also involved in
the provision of in-flight meals for third parties. In addition
to passenger transportation services, Korean Air Lines is a
cargo carrier that operates freighters worldwide. During the
year ended December 31, 2007, its operations spanned 101 cities
in 36 overseas countries with a fleet of 126 aircraft and it
carried 22,850,000 passengers and 2,280,000 tons of freight.
KOREAN AIR: Posts KRW556.8 Billion Net Loss in 2016
---------------------------------------------------
Yonhap News Agency reports that Korean Air Lines Co. said Feb. 9
its net loss shrank from a year earlier in 2016 helped by a
slight increase in sales.
Net loss came to KRW556.8 billion (US$485.9 million), compared
with a net loss of KRW562.97 billion in 2015, the company said in
a regulatory filing, Yonhap relays.
Sales gained 1.6 percent on-year to KRW11.73 trillion, with
operating profit spiking 26.9 percent to KRW1.12 trillion, Yonhap
adds.
Yonhap says the company blamed foreign exchange losses, as well
as losses from its near bankrupt affiliate Hanjin Shipping Co.
"Despite a rise in sales and improved operating profit based on
reduced costs, the company posted a net loss due to losses from
foreign exchange and Hanjin Shipping-related losses," it said.
In the first nine months of the year, the country's largest full
service carrier had posted a net profit of KRW85.1 billion, a
turnaround from a net loss of KRW695 billion over the same period
in 2015, Yonhap discloses.
Korean Air's 2016 net loss is its fourth straight annual net
loss, according to Bloomberg.
About Korean Air
Headquartered in Seoul, South Korea, Korean Air Lines Co. Ltd.
-- http://kr.koreanair.com/-- is a Korea-based company engaged
in the passenger airline transportation business. Its principal
activities consist of the provision of domestic and
international airline services; the production of aircraft,
including military aircraft; the provision of aircraft
maintenance and engineering services, and the sale of duty-free
goods. Korean Air Lines offers four classes of service: Economy
Class, Business Class, First Class and Premium Class, and
provides in-flight services, including cabin crew, in-flight
entertainment, meal and other services. It is also involved in
the provision of in-flight meals for third parties. In addition
to passenger transportation services, Korean Air Lines is a
cargo carrier that operates freighters worldwide. During the
year ended December 31, 2007, its operations spanned 101 cities
in 36 overseas countries with a fleet of 126 aircraft and it
carried 22,850,000 passengers and 2,280,000 tons of freight.
KUMHO TIRE: Q4 Net Loss Narrows to KRW5.3 Billion
-------------------------------------------------
Yonhap News Agency reports that Kumho Tire Co. said Feb. 8 its
net loss shrank greatly from a year earlier in the fourth
quarter, helped by a slight increase in sales.
The net loss came to KRW5.3 billion (US$4.63 million) in the
October-December period, compared with a net loss of KRW34.5
billion over the same period in 2015, Yonhap relates citing the
company's regulatory filing.
Sales gained 0.9 percent on-year to KRW790.9 billion in the three
months ended Dec. 31. Operating profit jumped 28.1 percent to
KRW54.7 billion, Yonhap discloses.
For the entire year, the net loss narrowed to about KRW60.3
billion from a net loss of KRW67.5 billion in the previous year.
Full-year sales slipped 3.1 percent on-year to about
KRW2.95 trillion, while operating profit plunged 11.7 percent to
KRW120 billion, reports Yonhap.
Kumho Tire Co. Ltd. manufactures tires. The company's offerings
include tires for sports utility vehicles, passenger cars,
various sizes of trucks and buses and racing cars. In addition,
the company provides batteries for automobiles. The company is
part of the Kumho Asiana Group.
SK HYNIX: Moody's Says Bid for Toshiba Memory Business Credit Neg
-----------------------------------------------------------------
Moody's Investors Service says that SK Hynix Inc.'s (Ba1
positive) bid for a stake in Toshiba Corporation's (Caa1 review
for downgrade) memory business, if successful, is credit negative
but the potential impact on SK Hynix's credit quality is
mitigated by the Korean-based company's robust performance.
On Feb. 7, 2017, SK Hynix Inc. announced that it had submitted a
non-binding bid for a stake in Toshiba's memory business.
"SK Hynix's bid for a minority stake in Toshiba, if successful,
will give it only limited access to its competitor's technology
and cash flows, as its stake will likely be less than 20%," says
Gloria Tsuen, a Moody's Vice President and Senior Analyst.
"Nevertheless, while the acquisition cost could potentially prove
sizeable, SK Hynix's robust operating performance and cash flow
in 2017 should keep its financial leverage manageable, and within
around 1x in terms of its adjusted debt/EBITDA," adds Tsuen.
SK Hynix had a strong financial profile, with KRW4.1 trillion in
cash and short-term investments and a modest KRW200 billion in
net debt as of end-2016. Its adjusted debt/EBITDA of around 0.6x
in 2016 was also strong for its rating level.
Moody's expects that SK Hynix's revenue and profit will increase
25%-30% in 2017, on the back of continued strong DRAM demand and
limited supply growth.
The NAND market is competitive, and major players are seeking to
close their technological gap with market leader Samsung
Electronics Co., Ltd. (A1 stable), especially in 3D products.
However, Moody's does not expect a minority stake in Toshiba
would significantly improve SK Hynix's modest #4 market position
in NAND, in the absence of full control over Toshiba's
technology.
Moreover, as Toshiba's memory business may not pay sizeable
dividends, especially given the associated high capex and
investment needs, SK Hynix may not derive any meaningful cash
inflow from its minority shareholding.
Toshiba is the world's second largest NAND manufacturer by
revenue, with a 19.8% market share as of 3Q 2016, according to
DRAMExchange. Its market share was behind that of Samsung's
36.6%, but ahead of Western Digital Corporation's (Ba1 stable)
17.1%, SK Hynix's 10.4%, and Micron Technology, Inc.'s (Ba2
stable) 9.8%.
Toshiba put part of its memory business up for sale in January
2017 to enhance its financial structure, following its disclosure
in December 2016 of a likely significant impairment loss of
several billion US dollars, related to its US nuclear
construction and integrated services business. It seeks to
complete the sale by March 31, 2017.
Toshiba's memory business generated JPY846 billion (about $7.0
billion) in sales and JPY110 billion ($916 million) in reported
operating income in the fiscal year ended March 2016.
SK Hynix's Ba1 corporate family rating continues to factor in one
notch of uplift for support from its parent, SK Telecom Co., Ltd.
(A3 stable).
The principal methodology used in this rating was Semiconductor
Industry Methodology published in December 2015.
SK Hynix Inc., a Korea-based company, is engaged in the design,
manufacture and sale of memory chips, such as DRAM and NAND flash
memory. It is 20.07%-owned by SK Telecom Co., Ltd. (A3 stable).
*********
Tuesday's edition of the TCR-AP delivers a list of indicative
prices for bond issues that reportedly trade well below par.
Prices are obtained by TCR-AP editors from a variety of outside
sources during the prior week we think are reliable. Those
sources may not, however, be complete or accurate. The Tuesday
Bond Pricing table is compiled on the Friday prior to
publication. Prices reported are not intended to reflect actual
trades. Prices for actual trades are probably different. Our
objective is to share information, not make markets in publicly
traded securities. Nothing in the TCR-AP constitutes an offer
or solicitation to buy or sell any security of any kind. It is
likely that some entity affiliated with a TCR-AP editor holds
some position in the issuers' public debt and equity securities
about which we report.
A list of Meetings, Conferences and Seminars appears in each
Wednesday's edition of the TCR-AP. Submissions about insolvency-
related conferences are encouraged. Send announcements to
conferences@bankrupt.com
Friday's edition of the TCR-AP features a list of companies with
insolvent balance sheets obtained by our editors based on the
latest balance sheets publicly available a day prior to
publication. At first glance, this list may look like the
definitive compilation of stocks that are ideal to sell short.
Don't be fooled. Assets, for example, reported at historical
cost net of depreciation may understate the true value of a
firm's assets. A company may establish reserves on its balance
sheet for liabilities that may never materialize. The prices at
which equity securities trade in public market are determined by
more than a balance sheet solvency test.
*********
S U B S C R I P T I O N I N F O R M A T I O N
Troubled Company Reporter-Asia Pacific is a daily newsletter co-
published by Bankruptcy Creditors' Service, Inc., Fairless Hills,
Pennsylvania, USA, and Beard Group, Inc., Washington, D.C., USA.
Valerie U. Pascual, Marites O. Claro, Joy A. Agravante, Rousel
Elaine T. Fernandez, Julie Anne L. Toledo, and Peter A. Chapman,
Editors.
Copyright 2017. 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
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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 ***