/raid1/www/Hosts/bankrupt/TCRAP_Public/171222.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, December 22, 2017, Vol. 20, No. 254
Headlines
A U S T R A L I A
APP INCOME: Second Creditors' Meeting Set for January 2
BRAKEZ PTY: First Creditors' Meeting Set for January 2
EVOLUTION GYMNASTICS: First Creditors' Meeting Set for Dec. 29
M KEEN: Second Creditors' Meeting Slated for January 4
MESOBLAST LTD: Will Get Up to EUR20MM From TiGenix License Deal
NEWSAT LIMITED: Former CEO Adrian Ballintine Charged
PETERS COACHES: Worrells Solvency Appointed as Liquidators
R C CIVIL: First Creditors' Meeting Set for January 3
WAYS PHONE: First Creditors' Meeting Set for Dec. 29
* AUSTRALIA: 168 ICT Companies Go Bust in 2017, ASIC Report Shows
C H I N A
BIOSTAR PHARMACEUTICALS: Director Quits Over Non-Payment of Fees
URUMQI GAOXIN: Fitch Rates US$200MM Sr. Unsecured Notes BB+
H O N G K O N G
NOBLE GROUP: Gets Extension on Waiver for Revolving Debt Facility
I N D I A
ABHIMAANI PRAKASHANA: Ind-Ra Migrates D Rating to Non-Cooperating
AMIT BUILDWELL: ICRA Withdraws B+ Rating on INR5cr LT Loan
AYURSUNDRA HEALTHCARE: Ind-Ra Affirms BB-/Stable Issuer Rating
BC POWER CONTROLS: Ind-Ra Assigns IND BB Issuer Rating
BHAVYA CONSTRUCTIONS: CRISIL Withdraws 'B' Rating on INR8MM Loan
BHILAI ENGINEERING: CRISIL Withdraws D Rating on INR381.16MM Loan
COSMOS DEVELOPERS: CRISIL Withdraws B Rating on INR14MM Term Loan
DBS AUTOMOBILES: CRISIL Reaffirms B+ Rating on INR6MM Cash Loan
DIVINE MISSION: CARE Assigns B Rating to INR6cr LT Loan
GOYAL EDUCATIONAL: CRISIL Assigns 'D' Rating to INR4.5MM Loan
HARVIN IMPEX: CRISIL Reaffirms 'C' Rating on INR7.5MM LT Loan
KANORIA SUGAR: Ind-Ra Assigns 'D' Long-Term Issuer Rating
MAGNUM STEELS: CRISIL Withdraws B Rating on INR5.5MM LT Loan
MURLIDHAR AGRO: CARE Lowers Rating on INR7cr LT Loan to 'D'
MUTHA INDUSTRIES: ICRA Removes 'B' Rating From Not Cooperating
PANORAMA ELECTRONICS: CRISIL Assigns B+ Rating to INR7MM Loan
RAGHAV INDUSTRIES: CARE Assigns B+ Rating to INR10cr Loan to B+
ROSE METAL: Ind-Ra Migrates B Issuer Rating to Non-Cooperating
RUCHI SOYA: NCLT Orders Initiation of Insolvency Proceedings
SAALIM SHOES: CRISIL Withdraws D Rating on INR35MM Packing Loan
SAVEMAX WHOLESALE: CARE Lowers Rating on INR155.23cr Loan to D
SHREE SIDDHESHWAR: CRISIL Hikes Rating on INR200MM Credit to B+
SREE ANJANEYA: CRISIL Assigns B- Rating to INR3.5MM Loan
STEEL PRODUCTS: CRISIL Lowers Rating on INR11.5MM Loan to B-
THERMAL FABRICATORS: CRISIL Reaffirms B+ Rating on INR3MM Credit
TILAK EXPORTS: CRISIL Lowers Rating on INR7MM Packing Loan to D
TRANFORMEX FERROUS: CARE Lowers Rating on INR4.64cr Loan to D
VANI ORGANICS: CARE Moves B Rating to Not Cooperating Category
VERMA TRACTORS: ICRA Raises Rating on INR7cr Cash Loan to B+
WINDSOR EDIFICE: ICRA Lowers Rating on INR50cr Term Loan to D
ZUBIC LIFESCIENCE: CARE Lowers Rating on INR12.80cr Loan to D
J A P A N
TOSHIBA CORP: China Officials Concerned With Hynix Role in Sale
N E W Z E A L A N D
MEDIA INFORMATION: Liquidators Find Buyer for Group's Assets
S I N G A P O R E
GLOBAL A&T: Fitch Lowers IDRs to 'D' on Chapter 11 Filing
S O U T H K O R E A
CEYLON DOLLAR: Fitch Affirms Then Withdraws B+f Cr. Quality Rating
X X X X X X X X
* Fitch: Sees Stable 2018 Outlook for 356 Asia-Pacific Corporates
- - - - -
=================
A U S T R A L I A
=================
APP INCOME: Second Creditors' Meeting Set for January 2
-------------------------------------------------------
A second meeting of creditors in the proceedings of App Income
Investments Pty Limited has been set for Jan. 2, 2018, at
11:30 a.m. at Level 5, 34 Queen Street, in Melbourne.
The purpose of the meeting are (1) to receive the report by the
Administrator about the business, property, affairs and financial
circumstances of the Company; and (2) for the creditors of the
Company to resolve whether the Company will execute a deed of
company arrangement, the administration should end, or the
Company be wound up.
Creditors wishing to attend are advised proofs and proxies should
be submitted to the Administrator by Jan. 2, 2018, at 10:00 a.m.
Trajan John Kukulovski of Chan & Naylor was appointed as
administrator of App Income on Nov. 23, 2017.
BRAKEZ PTY: First Creditors' Meeting Set for January 2
------------------------------------------------------
A first meeting of the creditors in the proceedings of Brakez Pty
Ltd, trading as Capones, will be held at Ray Bradfield Room,
Forest Street, in Castlemaine, Victoria, on Jan. 2, 2018, at 11:00
a.m.
Kristen Beadle and Ken Sellers of Sellers Muldoon Benton were
appointed as administrators of Brakez Pty on Dec. 18, 2017.
EVOLUTION GYMNASTICS: First Creditors' Meeting Set for Dec. 29
--------------------------------------------------------------
A first meeting of the creditors in the proceedings of Evolution
Gymnastics Academy Pty Ltd will be held at the offices of Worrells
Solvency & Forensic Accountants, Level 15, 114 William Street, in
Melbourne, Victoria, on Dec. 29, 2017, at 10:30 a.m.
Nathan Deppeler of Worrells Solvency & Forensic Accountants was
appointed as administrator of Evolution Gymnastics on Dec. 15,
2017.
M KEEN: Second Creditors' Meeting Slated for January 4
------------------------------------------------------
A second meeting of creditors in the proceedings of M Keen
Investments Pty Ltd, trading as Tag It Safe Mascot and Freight
Rite Logistics (Aust), and MLH Enterprises Pty Ltd, trading as FRL
Global, FRL 3PL (Aust), FRL Logistics (Aust), and FRL Couriers
NSW-VIC-QLD, has been set for Jan. 4, 2018, at
11:00 am ADST (10:00 am AEST) - M Keen Investments Pty Ltd
11:30 am ADST (10:30 am AEST) - MLH Enterprises Pty Ltd
at Rydges Hotel Sydney Airport, 8 Arrivals Court, in Sydney
International Airport, New South Wales.
The purpose of the meeting are (1) to receive the report by the
Administrator about the business, property, affairs and financial
circumstances of the Company; and (2) for the creditors of the
Company to resolve whether the Company will execute a deed of
company arrangement, the administration should end, or the
Company be wound up.
Creditors wishing to attend are advised proofs and proxies should
be submitted to the Administrator by Jan. 3, 2018, at 4:00 p.m.
Brendan Nixon and Leon Lee of SM Solvency were appointed as
administrators of M Keen and MLH Enterprises on Nov. 29, 2017.
MESOBLAST LTD: Will Get Up to EUR20MM From TiGenix License Deal
---------------------------------------------------------------
Mesoblast Limited has granted TiGenix (Euronext Brussels and
Nasdaq: TIG) exclusive access to certain of its patents to support
global commercialization of the adipose-derived mesenchymal stem
cell product Cx601 for the local treatment of fistulae. The
agreement includes the right for TiGenix to grant sub-licenses to
affiliates and third parties, including TiGenix's current
development and commercialization partner ex-United States.
As consideration, Mesoblast will receive up to EUR20 million
(approximately US$24 million) in payments, with EUR5 million
upfront, EUR5 million within 12 months, and up to EUR10 million in
product regulatory milestones. Additionally, Mesoblast will
receive single digit royalties on net sales of Cx601.
TiGenix CEO Eduardo Bravo said: "We are delighted to have
concluded this exclusive license agreement with Mesoblast, which
will broaden our IP protection for Cx601 as we move closer to
commercialization in Europe. We continue advancing our global
pivotal Phase 3 clinical trial to support a future Biologics
License Application (BLA) to the US FDA and are also pursuing the
development of new indications for Cx601 to expand its potential
market. With this newly-added IP protection, TiGenix now has a
stronger intellectual property position that supports the use of
Cx601 for treatment of all fistulae."
Mesoblast Chief Executive Dr Silviu Itescu stated: "We are pleased
to help contribute to making Cx601, a much-needed treatment
option, available to patients with fistulae worldwide. This
agreement highlights the strength of Mesoblast's extensive
intellectual property portfolio covering mesenchymal lineage
cells. When consistent with our strategic objectives, Mesoblast
may consider providing third parties with commercial access to our
valuable patent portfolio."
Mesoblast continues to develop its proprietary bone marrow-derived
allogeneic expanded MSC product candidate for intravenous delivery
to induce remission in patients with biologic-refractory Crohn's
disease.
About TiGenix
TiGenix NV (Euronext Brussels and NASDAQ: TIG) is an advanced
biopharmaceutical company developing novel therapies for serious
medical conditions by exploiting the anti-inflammatory properties
of allogeneic, or donor-derived, stem cells. TiGenix is
headquartered in Leuven (Belgium) and has operations in Madrid
(Spain) and Cambridge, MA (USA). For more information, please
visit http://www.tigenix.com.
About Mesoblast
Australia-based Mesoblast Limited (ASX:MSB; Nasdaq:MESO) is a
global developer of innovative cell-based medicines. The Company
has leveraged its proprietary technology platform, which is based
on specialized cells known as mesenchymal lineage adult stem
cells, to establish a broad portfolio of late-stage product
candidates. Mesoblast's allogeneic, 'off-the-shelf' cell product
candidates target advanced stages of diseases with high, unmet
medical needs including cardiovascular conditions, orthopedic
disorders, immunologic and inflammatory disorders and
oncologic/hematologic conditions.
Mesoblast Limited reported a net loss before income tax of
US$90.21 million for the year ended June 30, 2017, a net loss
before income tax of US$90.82 million for the year ended June 30,
2016, and a net loss before income tax of US$96.24 million for the
year ended June 30, 2015. As of Sept. 30, 2017, Mesoblast had
US$671.89 million in total assets, US$112.30 million in total
liabilities and US$559.59 million in total equity.
PricewaterhouseCoopers, in Melbourne, Australia, issued a "going
concern" opinion on the consolidated financial statements for the
year ended June 30, 2017, noting that Company has suffered
recurring losses from operations that raise substantial doubt
about its ability to continue as a going concern.
NEWSAT LIMITED: Former CEO Adrian Ballintine Charged
----------------------------------------------------
Following an Australian Securities and Investments Commission
investigation, Adrian Maxwell Ballintine of Brighton in Victoria
has been charged with three counts of authorising the making of a
false or misleading document required under the Corporations Act.
The charges were brought by ASIC following an investigation into
NewSat Limited, a company formerly listed on the Australian
Securities Exchange.
ASIC alleges that on three separate occasions between Jan. 18,
2012 and Sept. 15, 2012, Mr. Ballintine, a director and former
chief executive officer of NewSat, authorised the making of three
invoices that were false or misleading contrary to section 1308(2)
of the Corporations Act. ASIC alleges that those invoices caused
NewSat to make payments amounting to AUD357,000 to a private
company associated with Mr. Ballintine.
Each of the charges carries a maximum penalty of five years
imprisonment.
The charges have been listed for a filing hearing to be held on
Jan. 16, 2018.
The matter is being prosecuted by the Commonwealth Director of
Public Prosecutions.
NewSat Limited was a satellite communications provider that was
listed on the Australian Securities Exchange until Aug. 31, 2015.
On April 17, 2015, receiver managers were appointed to NewSat. On
Aug. 7, 2015 the company entered into liquidation.
Jason Dermot Cullen, an accountant engaged to provide services to
NewSat Limited has also been charged with two counts under section
1308(2) of the Corporations Act.
PETERS COACHES: Worrells Solvency Appointed as Liquidators
----------------------------------------------------------
Matthew Newton at The Chronicle reports that a liquidator has been
appointed to wind up a 67-year-old Toowoomba company.
Family-owned Peters Coaches closed its doors last week after six
decades of operation, the report says.
Shareholders of Peters Coaches, trading as RDP Enterprises Pty
Ltd, voted to place the company into liquidation, the Chronicle
relates.
According to the report, Toowoomba liquidator Adam Ward of
Worrells Solvency and Forensic Accountants said the company was
hit hard by the downturn in the resources sector over the past few
years, and that attempts to refocus the business on the tourism
industry had proved unsuccessful.
"They had increasing pressure from financiers . . . and as a
result of numbers not stacking up, they've had to close their
doors," the report quotes Mr. Ward as saying. "There's probably a
shortfall of anywhere between AUD1.5-2 million. Probably about
AUD1 million of that will be worn by financiers that had security
over the bus fleets."
Only appointed as liquidator last week, Mr. Ward said he was now
dealing with the company's assets and informing creditors of the
liquidation, adds The Chronicle.
R C CIVIL: First Creditors' Meeting Set for January 3
-----------------------------------------------------
A first meeting of the creditors in the proceedings of R C Civil
Pty Ltd will be held at the offices of Hall Chadwick, Level 40
2 Park Street, in Sydney, New South Wales, on Jan. 3, 2018, at
10:00 a.m.
David Allan Ingram of Hall Chadwick was appointed as administrator
of R C Civil on Dec. 19, 2017.
WAYS PHONE: First Creditors' Meeting Set for Dec. 29
----------------------------------------------------
A first meeting of the creditors in the proceedings of Ways Phone
Pty Ltd will be held at Ways Phone Pty Ltd, 5/29 Hutchinson
Street, in Surry Hills, New South Wales, on Dec. 29, 2017, at
11:00 a.m.
Stephen Wesley Hathway of Helm Advisory was appointed as
administrator of Ways Phone on Dec. 18, 2017.
* AUSTRALIA: 168 ICT Companies Go Bust in 2017, ASIC Report Shows
-----------------------------------------------------------------
Nico Arboleda at CRN reports that the Australian Securities and
Investments Commission (ASIC) revealed in a report that 168
information media and telecommunications companies went under in
2017.
The number is the lowest since 2005, when ASIC counted 138
insolvent ICT companies in its report for that year, CRN says.
According to CRN, the 2017 report shows the number of tech
companies going under dropped by 25 percent compared to 2016's 225
figure. The IT sector, however, still had the ninth-highest number
of insolvencies when ranked among 24 other industry types.
ASIC cited cash flow issues and poor strategic management as the
cause of many tech companies going under, CRN relays. Trading
losses and poor financial control, including lack of records, were
also cited as major drivers, CRN notes.
Eight ICT companies were cited to have at least AUD10 million in
deficiency - the shortfall between estimated assets and
liabilities - while 57 had a deficiency between AUD50,000 to
AUD250,000, according to CRN.
Nine companies were found to have more than AUD10 million in
liabilities, while 51 had less than AUD1 in assets, CRN relays.
Compared to other industries in the report, only 52 ICT companies
were cited to have money owed to secured creditors, while only 64
owed more than AUD250,000 to unsecured creditors, CRN says.
CRN notes that 143 ICT companies had at least AUD1 in unpaid
taxes, with 27 owing at least AUD250,001 and 10 owing at least
AUD1 million.
The ASIC report also cited 14 companies that may have committed
criminal misconduct prior to appointing an external administrator,
contravening five sections of the Corporations Act, CRN relays.
According to CRN, six companies were found to have directors or
officers not using their position in good faith, while five
companies failed to keep financial records. The ASIC report also
found 314 civil breaches were committed among the 168 ICT
companies listed.
It was found that 102 ICT companies had traded insolvent, while 75
breached the directors' and officers' care and diligence duties
section of the Corporations Act, adds CRN.
The report covered 7765 companies across 24 industries, which was
down from 9465 external administrators' reports in 2016 and 8354
reports in 2015, CRN discloses.
=========
C H I N A
=========
BIOSTAR PHARMACEUTICALS: Director Quits Over Non-Payment of Fees
----------------------------------------------------------------
Leung King Fai, an independent director of the Board of Directors
of Biostar Pharmaceuticals, Inc., delivered a letter to the Board
in which he informed the Board that he tendered his resignation as
an independent Board member effective as of Dec. 12, 2017. The
Company accepted Leung King Fai's resignation upon receipt of the
resignation letter. At the time of his resignation, he served as
the Chairman of the Audit Committee of the Board.
Leung King Fai's letter states, in part, that his decision to
resign as an independent director was made because his "director's
fee from 1 January 2014 to present has not been paid."
"I repeatedly requested BSPM's management to pay my accrued
director's fee many times. Up to this moment, BSPM is still unable
to pay my accrued director's fee notwithstanding the significant
cash inflows from fund raising activities and the huge amount of
repayments from accounts receivable," said Mr. Fai in his
resignation letter.
About Biostar Pharmaceuticals
Based in Xianyang, China, Biostar Pharmaceuticals, Inc., through
its wholly owned subsidiary and controlled affiliate in China --
http://www.biostarpharmaceuticals.com/-- develops, manufactures,
and markets pharmaceutical and health supplement products for a
variety of diseases and conditions.
Biostar incurred a net loss of $5.69 million in 2016 and a net
loss of $25.11 million in 2015.
As of Sept. 30, 2017, the Company had $41.42 million in total
assets, $5.27 million in total liabilities, all current, and
$36.14 million in total stockholders' equity.
Mazars CPA Limited, Certified Public Accountants, in Hong Kong,
issued a "going concern" qualification on the consolidated
financial statements for the year ended Dec. 31, 2016, stating
that the Company had experienced a substantial decrease in sales
volume which resulting a net loss for the year ended Dec. 31,
2016. Also, part of the Company's buildings and land use rights
are subject to litigation between an independent third party and
the Company's chief executive officer, and the title of these
buildings and land use rights has been seized by the PRC Courts so
that the Company cannot be sold without the Court's permission. In
addition, the Company already violated its financial covenants
included in its short-term bank loans. These conditions raise
substantial doubt about the Company's ability to continue as a
going concern.
URUMQI GAOXIN: Fitch Rates US$200MM Sr. Unsecured Notes BB+
-----------------------------------------------------------
Fitch Ratings has assigned Urumqi Gaoxin Investment and
Development Group Co., Ltd.'s (UGID, BB+/Stable) US$200 million
5.2% senior unsecured notes due 2020 a final rating of 'BB+'.
The assignment of the final ratings follows the receipt of
documents conforming to information already received. The final
rating is in line with the expected rating assigned on December 5,
2017.
KEY RATING DRIVERS
The offshore notes are issued by UGID and constitute its unsecured
and unsubordinated obligations, ranking pari passu with all its
other present and future obligations.
RATING SENSITIVITIES
Any rating action on UGID's Issuer Default Rating would result in
similar action on the ratings of the US dollar notes.
================
H O N G K O N G
================
NOBLE GROUP: Gets Extension on Waiver for Revolving Debt Facility
-----------------------------------------------------------------
Noble Group Limited on Dec. 21 announced that it has obtained an
extension on a waiver in relation to the financial covenants in
its committed unsecured revolving credit facility to May 18, 2018
(being the maturity date of such facility).
The company said it continues to be in discussions with its
creditors. "Whilst no assurance can be given as to the outcome of
these discussions, the Company believes that these are open and
constructive, and are moving forward," it said.
"The Company's objective in these discussions continues to be: (a)
managing the maturity of its borrowings to optimise the use of
available cash for the foreseeable future; and (b) treating all
stakeholders fairly."
Hong Kong-based Noble Group Limited (SGX:N21) --
http://www.thisisnoble.com/-- engages in supply of agricultural,
industrial and energy products. The Company supplies agricultural
and energy products, metals, minerals and ores. Agriculture
products include grains, oilseeds and sugar to palm oil, coffee,
and cocoa. Energy business includes coal, gas and liquid energy
products. In metals, minerals and ores (MMO), it supplies iron
ore, aluminum, special ores and alloys. The Company operates
nearly in 140 locations. It supplies growth demand markets in
Asia and Middle East. Alcoa World Alumina and Chemicals is the
subsidiary of this company.
As reported in the Troubled Company Reporter-Asia Pacific on
Nov. 22, 2017, Fitch Ratings downgraded Hong Kong-based
commodities trader Noble Group Limited's Long-Term Foreign-
Currency Issuer Default Rating (IDR), senior unsecured rating and
the ratings on all its outstanding senior unsecured notes to 'CC'
from 'CCC'. The Recovery Rating is 'RR4'. The downgrade follows
Noble's Nov. 15, 2017 announcement that it has commenced
discussions with stakeholders on its capital structure.
=========
I N D I A
=========
ABHIMAANI PRAKASHANA: Ind-Ra Migrates D Rating to Non-Cooperating
-----------------------------------------------------------------
India Ratings and Research (Ind-Ra) has affirmed Abhimaani
Prakashana's (AP) Long-Term Issuer Rating at 'IND D'. The rating
has also been migrated to the non-cooperating category. The issuer
did not participate in the surveillance exercise despite
continuous requests and follow-ups by the agency. Thus, the rating
is on the basis of best available information. Investors and other
users are advised to take appropriate caution while using these
ratings. The rating will now appear as 'IND D(ISSUER NOT
COOPERATING)' on the agency's website. The instrument-wise rating
action is:
-- INR60 mil. (Reduced from INR63.9 mil.) Long term loans (Long-
term) affirmed and migrated to non-cooperating category with
IND D(ISSUER NOT COOPERATING) rating.
Note: ISSUER NOT COOPERATING: Issuer did not cooperate; based on
best available information.
KEY RATING DRIVERS
The affirmation reflects AP's continued delays in debt servicing
during the 12 months ended November 2017 due to a tight liquidity
position.
RATING SENSITIVITIES
Positive: Timely debt servicing for three consecutive months could
be positive for the ratings.
COMPANY PROFILE
AP was established in 1985 as a proprietorship firm. The firm is
engaged in text books printing process. The firm is promoted by
Mr. Venkatesh and has an installed capacity to print 100 tonnes of
paper daily.
AMIT BUILDWELL: ICRA Withdraws B+ Rating on INR5cr LT Loan
----------------------------------------------------------
ICRA has withdrawn the ratings of [ICRA]B+ (Stable)/[ICRA]A4
(Issuer not cooperating) assigned to the INR10.00-crore bank
facilities of Amit Buildwell Private Limited (ABPL).
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long-term fund- 5.00 [ICRA]B+ (Stable) ISSUER NOT
based COOPERATING; Withdrawn
Long-term 1.00 [ICRA]B+ (Stable) ISSUER NOT
unallocated COOPERATING; Withdrawn
Long-term/short- 4.00 [ICRA]B+ (Stable)/[ICRA]A4
term non-fund based ISSUER NOT COOPERATING;
Withdrawn
Rationale
The ratings are withdrawn in accordance with ICRA's policy on
withdrawal and suspension and at the request of the company, based
on the no objection certificate provided by its banker.
Incorporated in 2005, ABPL is promoted by Mr. R.K. Yadav and his
family members. The company is headquartered in Delhi and has
branch offices in Noida, Gurgaon and Mohali. The company
undertakes civil construction projects for residential and
industrial buildings. The company also undertakes projects,
involving erection of RCC structures, sanitary and electrical
installations and site development works such as drainage systems,
boundary walls, roads, horticulture and water harvesting. It is a
registered Class-I contractor with the Central Public Works
Department (CPWD).
AYURSUNDRA HEALTHCARE: Ind-Ra Affirms BB-/Stable Issuer Rating
--------------------------------------------------------------
India Ratings and Research (Ind-Ra) has affirmed Ayursundra
Healthcare Private Limited's (AHPL) Long-Term Issuer Rating at
'IND BB-'. The Outlook is Stable. The instrument-wise rating
actions are:
-- INR60 mil. Fund-based working capital limits assigned with
IND BB-/Stable rating; and
-- INR911.98 mil. (increased from INR836.33 mil.) Long-term loan
due on August 2026 affirmed with IND BB-/Stable rating.
KEY RATING DRIVERS
The affirmation reflects AHPL's short operational track record as
the hospital commenced operations in December 2016, with a delay
of one month. The company's scale of operations was small with
revenue of INR243 million, including INR12.41 million from
hospital operations in FY17. During April to December 2017, the
hospital was operating at an average 36% of the actual capacity.
The ratings remain constrained by intense competition, which the
company would face being a new entrant, from the existing players.
The rating also factor in AHPL's moderate liquidity position as
reflected by 84.76% average utilisation of the fund-based limits
for the 12 months ended November 2017.
However, the ratings continue to benefit from the hospital's
locational advantage as it has easy accessibility to the airport,
interstate bus terminal, the railway station and the highway.
The ratings also remain supported by the promoters' more than one
and a half decades of experience in the healthcare industry in
operating trauma/surgery units and managing hospital operations
and staff in one of the super speciality centres in the northeast.
RATING SENSITIVITIES
Negative: Failure in stabilising operations leading to lower than
expected capacity utilisation could result in a negative rating
action.
Positive: Stabilisation of commercial operations, along with
maintenance of a comfortable liquidity profile, will lead to a
positive rating action.
COMPANY PROFILE
Incorporated on December 28, 2007, AHPL runs an 80-bed hospital in
Betkuchi village in Kampur district of Guwahati, Assam. Simanta
Das, Dr Abhijit Hazarika and Lakshi Baishya are the directors of
the company.
BC POWER CONTROLS: Ind-Ra Assigns IND BB Issuer Rating
------------------------------------------------------
India Ratings and Research (Ind-Ra) has assigned BC Power Controls
Limited (BCPL) a Long-Term Issuer Rating of 'IND BB'. The Outlook
is Stable. The instrument-wise rating action is:
-- INR340 mil. Fund-based limits assigned with IND BB/Stable/IND
A4+ rating.
KEY RATING DRIVERS
The ratings reflect BCPL's moderate credit metrics. In FY17,
interest coverage was 2.3x (FY16: 1.9x) and net leverage was
10.73x (FY16: 7.42x). The improvement in interest coverage was
driven by a decline in interest cost, while the deterioration in
net leverage was due to an increase in debt availed to fund
working capital requirements. Moreover, operating EBITDA margin
was thin at 0.8% in FY17 (FY16: 1.3%). The fall in operating
EBITDA margin was due to the company's failure to pass a rise in
raw material prices to customers.
The agency expects credit metrics to improve in FY18, on the basis
of an improvement in EBITDA margin to 1.9% and in interest
coverage to 2.8x in 1HFY18.
The ratings, however, are supported by a comfortable liquidity,
indicated by a 96% average utilisation of the fund-based limits
for the 12 months ended November 2017.
The ratings are also supported by the strong revenue growth of
BCPL. Revenue increased at a CAGR of 23.76% to INR3,541 million,
driven by an increase in sales volume. Revenue was INR1,719.26
million in 1HFY18. The scale of operations is moderate. Moreover,
its directors have over two decades of experience in the iron and
steel industry.
RATING SENSITIVITIES
Negative: Further decline in profitability leading to
deterioration in credit metrics on a sustained basis will be
negative for the ratings.
Positive: A substantial rise in revenue, along with an improvement
in credit metrics, on a sustained basis will be positive for the
ratings.
COMPANY PROFILE
Formed in 2008, BCPL is engaged in the manufacturing and trading
of copper wires and cables. It has a manufacturing facility in
Bhiwadi (Rajasthan). Its product portfolio includes armoured and
unarmoured cables, flexible and house wires, submersible cables,
and control and instrumentation cables.
BHAVYA CONSTRUCTIONS: CRISIL Withdraws 'B' Rating on INR8MM Loan
----------------------------------------------------------------
CRISIL has been consistently following up with Bhavya
Constructions Private Limited (BCPL) for obtaining information
through letters and emails dated Jan. 25, 2017, and Feb. 15 2017,
among others, apart from telephonic communication. However, the
issuer has remained non cooperative.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Bank Guarantee 2 CRISIL A4 (Issuer Not
Cooperating; Rating
Withdrawal)
Cash Credit 8 CRISIL B (Issuer Not
Cooperating; Rating
Withdrawal)
Letter of Credit 2 CRISIL A4 (Issuer Not
Cooperating; Rating
Withdrawal)
Overdraft 1.5 CRISIL A4 (Issuer Not
Cooperating; Rating
Withdrawal)
Term Loan 1.5 CRISIL A4 (Issuer Not
Cooperating; Rating
Withdrawal)
The investors, lenders and all other market participants should
exercise due caution while using the rating assigned/reviewed with
the suffix 'ISSUER NOT COOPERATING'. These ratings lack a forward
looking component as it is arrived at without any management
interaction and is based on best available or limited or dated
information on the company'.
Detailed Rationale
Despite repeated attempts to engage with the management, CRISIL
failed to receive any information on either the financial
performance or strategic intent of BCPL. This restricts CRISIL's
ability to take a forward looking view on the credit quality of
the entity. CRISIL believes that the information available for
BCPL is consistent with 'Scenario 1' outlined in the 'Framework
for Assessing Consistency of Information with CRISIL BB Rating
category or lower.' Based on the last available information, the
rating on bank facilities of BCPL continues to be 'CRISIL
B/Stable/CRISIL A4; Issuer not cooperating'
CRISIL has withdrawn its ratings on the INR15 crore bank
facilities on the company's request, and on receipt of the 'no-
objection certificate' from the banks. The rating action is in
line with CRISIL's policy on withdrawal of ratings.
BCPL, incorporated in 1991, is engaged in real estate project
development in Telangana.
BHILAI ENGINEERING: CRISIL Withdraws D Rating on INR381.16MM Loan
-----------------------------------------------------------------
CRISIL has withdrawn its ratings on the bank facilities of Bhilai
Engineering Corporation Limited (BECL) at the company's request
and on receipt of no objection letter from the banks. The rating
action is in line with CRISIL's policy on withdrawal of its rating
on bank loan facilities.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Bank Guarantee 381.16 CRISIL D (Withdrawal)
Bank Guarantee 10 CRISIL D (Withdrawal)
Cash Credit 92.9 CRISIL D (Withdrawal)
Corporate Loan 1.14 CRISIL D (Withdrawal)
Letter of Credit 5 CRISIL D (Withdrawal)
Letter of Credit 114.65 CRISIL D (Withdrawal)
Proposed Long Term
Bank Loan Facility 5.86 CRISIL D (Withdrawal)
Standby Line of Credit 10 CRISIL D (Withdrawal)
BECL, set up in 1976 and managed by the Jain family of Bhilai, has
three main business divisions 'engineering, fertilizers, and food.
Its clients include large public sector undertakings such as
National Mineral Development Corporation (NMDC) and Steel
Authority of India Ltd (SAIL).
COSMOS DEVELOPERS: CRISIL Withdraws B Rating on INR14MM Term Loan
-----------------------------------------------------------------
CRISIL has been consistently following up with Cosmos Developers
- Rajkot (CD) for obtaining information through letters and
emails dated August 18, 2017 and September 28, 2017, among others,
apart from telephonic communication. However, the issuer has
remained non-cooperative.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Term Loan 14 CRISIL B/Stable (Issuer Not
Cooperating; Rating
Withdrawal)
The investors, lenders and all other market participants should
exercise due caution while using the rating assigned/reviewed with
the suffix 'ISSUER NOT COOPERATING'. These ratings lack a forward
looking component as it is arrived at without any management
interaction and is based on best available or limited or dated
information on the company'.
Detailed Rationale
Despite repeated attempts to engage with the management, CRISIL
failed to receive any information on either the financial
performance or strategic intent of CD. This restricts CRISIL's
ability to take a forward looking view on the credit quality of
the entity. CRISIL believes that the information available for CD
is consistent with 'Scenario 2' outlined in the 'Framework for
Assessing Consistency of Information with CRISIL BBB' rating
category or lower. Based on the last available information, the
rating on bank facilities of CD continues to be 'CRISIL B/Stable;
Issuer not cooperating'
CRISIL has withdrawn its rating on the long-term bank facility of
Cosmos Developers at the company's request and after receiving a
no-due certificate from Oriental Bank of Commerce (OBC). The
rating action is in line with CRISIL's policy on withdrawal of its
ratings on bank facilities.
CD, a partnership firm formed in 2015, is constructing a
residential complex, Cosmos Plus, at Mavadi in Rajkot, Gujarat.
The firm is promoted by 11 partners who have extensive experience
in real estate development. Its operations are managed by Mr
Ramnik Savji Katodia, Mr Mitul Amrut Dhut, and Mr Kantilal Virji
Patel.
DBS AUTOMOBILES: CRISIL Reaffirms B+ Rating on INR6MM Cash Loan
---------------------------------------------------------------
CRISIL has reaffirmed its rating on the long-term bank facilities
of DBS Automobiles Pvt Ltd (DAPL) at 'CRISIL B+/Stable'.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Cash Credit 6 CRISIL B+/Stable (Reaffirmed)
Term Loan 2 CRISIL B+/Stable (Reaffirmed)
The rating continues to reflect the company's limited bargaining
power with principal, low operating profitability, exposure to
intense competition, and below-average financial risk profile
because of small networth and high TOLTNW. These weaknesses are
partially offset by benefits to be derived from established brand
and market position of Tata Motors Ltd (TML; rated 'CRISIL
AA/Positive/CRISIL A1+').
Key Rating Drivers & Detailed Description
Weakness
* Limited bargaining power with principal and low operating
profitability: The company only has dealership of TML's commercial
vehicles in Bihar, which leads to low bargaining power with
principal and limited credit available from it. Hence, operating
profitability has remained muted at 1.2% in fiscal 2017. Also,
association with a single supplier links revenue to the future
prospects of that principal.
* Exposure to intense competition: The company has to compete with
dealers of other commercial vehicle manufacturers such as Volvo,
Eicher, and Mahindra & Mahindra. Since there is no product
differentiation, pricing becomes the key attraction.
* Below-average financial risk profile: Networth was small at
INR3.9 crore and total outside liabilities to tangible networth
ratio high at 4.98 times, as on March 31, 2017, due to higher
dependence on working capital debt. This, along with low
profitability, led to average debt protection metrics, with
interest coverage and net cash accrual to total debt ratios of
1.98 times and 0.06 time, respectively, in fiscal 2017.
Strengths
* Benefits from established brand and market position of TML: DAPL
will benefit from the brand and dominant market position of TML in
the MHCV segment.
Outlook: Stable
CRISIL believes DAPL will benefit from the established brand and
market position of its principal. The outlook may be revised to
'Positive' if more-than-expected revenue or cash accrual or
substantial capital infusion leads to a better financial risk
profile. The outlook may be revised to 'Negative' if lower-than-
expected accrual, stretch in working capital requirement, or
significant, debt-funded capital expenditure weakens financial
risk profile, particularly liquidity.
Incorporated in June 2015, DAPL is an authorised dealer of TML's
light, medium, and heavy commercial vehicles in Rohtas, Kaimur,
Buxar, and Bhojpur districts of Bihar. The company has set up a 3S
(sales, service, and spares) facility in Rohtas, which started
commercial operations in March 2016.
DIVINE MISSION: CARE Assigns B Rating to INR6cr LT Loan
-------------------------------------------------------
CARE Ratings has assigned rating to the bank facilities of Divine
Mission Educational Trust (DME), as:
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long-term Bank
Facilities 6.00 CARE B; Stable Assigned
Detailed Rationale & Key Rating Drivers
The rating assigned to the bank facilities of DME is constrained
by trust's small though growing scale of operations leveraged
capital structure and increasing competition & limited reach. The
rating is further constrained due to high regulation in the
educational sector in India. The rating, however, derives strength
from experienced and qualified trustees along with competent
teaching staff, moderate surplus margin &debt coverage indicators
and buoyant prospects of Pre-school and K-12 segment in India.
Going forward, the ability of the trust to increase the enrolment
of students while improving its overall solvency position would
remain the key rating sensitivities.
Detailed description of the key rating drivers
Key Rating Weaknesses
Small though growing scale of operations: Although the total
operating income of the trust increased from INR1.00 crore in FY15
to INR5.42 crore in FY17 at a compounded annual growth rate (CAGR)
of approximately 133% due to increase in the cumulative student
strength, however, the scale of operations continued to remain
small. The small scale limits the trust's financial flexibility in
times of stress and deprives it of scale benefits. In 6MFY18
(Provisional), the trust reported TOI of INR4.43 crore along with
surplus of INR1.17 crore.
Leveraged capital structure: The capital structure of the trust
stood leveraged with overall gearing ratio of 2.78x as on March
31, 2017 (PY: 3.01x) mainly on account of high dependence upon
borrowings to fund various business requirements. Further, corpus
fund also stood low which resulted in leveraged capital structure.
Increasing competition and limited reach: The trust operates one
school in Fatehabad, Haryana. Single location of Haryana limits
the penetration level for the society. Further, due to increasing
focus on education in India, a number of schools have opened up in
close proximity and several established private and government
schools are already running in and around the city.
High regulation in educational sector in India: Educational sector
is regulated by Ministry of Human Resource at the national level,
by the education ministries in each state, as well as by Central
bodies like University Grant Commission (UGC) and 14 other
professional councils. The operating and financial flexibility of
the education sector is limited, as regulations governs almost all
aspects of operations, including fee structure, changes in
curriculum and infrastructure requirements.
Key Rating Strengths
Experienced and qualified trustees along with competent teaching
staff: Mr. Jag Pal Hayer has an experience of two decades in the
education industry gained through his association with DME and
various schools in Chandigarh. Mr. Surender Singh (President) and
Mr. Kewal Krishan (Vice-President) have experience of 8 years and
5 years, respectively in the education industry, gained through
their association with various schools in Fatehabad. Furthermore,
DME has employed a highly experienced and qualified teaching staff
to support the academic requirements of the school.
Moderate surplus margins and debt coverage indicators: The trust
had moderate surplus margins as reflected by SBID margin of 28.48%
and surplus margin of 19.52% in FY17. SBID margin declined from
41.68% in FY15 due to increase in operational expenses like
employee costs, selling expenses etc. However, surplus margin
improved on y-o-y basis due to improvement in SBID in absolute
terms and decline in interest expenses in percentage terms.
Furthermore, the trust also had comfortable debt coverage
indicators marked by interest coverage ratio of 3.18x in FY17 and
total debt to GCA of 5.79x for FY17 (PY: 2.89X and 6.43x,
respectively).
Buoyant prospects of Pre-school and K-12 segment in India: The
Government's thrust on improving the country's literacy rate
through higher enrolments as well as ensuring lower drop-out rates
in the K- 12 education space is expected to drive the growth in
terms of opening-up of the new schools especially in Tier-III
cities and rural areas of the country, which will facilitate more
and more opportunities to students spread across the nation.
Divine Mission Educational Trust (DME) got registered as a trust
on June 13, 2012. The trust was established by Mr. Jag Pal Hayer
with an objective to provide school education services and is
running a school under the name of "Divine International Public
School" (DIP) at Fatehabad, Haryana. DIP is Central Board of
Secondary Education (CBSE) affiliated, currently offering classes
from nursery up to senior secondary level including all four
courses viz. non-medical, medical, commerce and humanities.
GOYAL EDUCATIONAL: CRISIL Assigns 'D' Rating to INR4.5MM Loan
-------------------------------------------------------------
CRISIL has assigned its 'CRISIL D/CRISIL D' ratings to the bank
facilities of Goyal Educational and Welfare Society (GEWS).
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Proposed Long Term
Bank Loan Facility 2 CRISIL D
Long Term Loan 4.5 CRISIL D
Overdraft 1 CRISIL D
The ratings reflect delay in servicing term debt obligation, below
average financial risk profile and susceptibility to government
regulations. These weaknesses are partially offset by healthy
demand prospects for the education industry.
Key Rating Drivers & Detailed Description
Weaknesses
* Delay in meeting term loan obligation: The society has delayed
paying instalments on term loan by more than 60 days due to short-
term cash flow mismatches that led to constrained liquidity.
* Limited scope for improvement in revenue because of regulated
fee structure: Various courses offered by the society have to
comply with specific operational and infrastructure norms set by
regulatory bodies. Thus, the society needs to regularly invest in
workforce and infrastructure to comply with evolving guidelines of
regulatory bodies, leading to high costs. Also, course fees are
decided and revised by the universities, which limit growth in
revenue.
* Below average financial risk profile: Th society recorded below
average financial risk profile marked by gearing of 2.10 times as
on March 31st 2016. CRISIL expects financial risk profile to
remain weak over the medium term.
Strengths
* Healthy demand prospects for the education industry: With
increase in initiatives by government, awareness of education,
especially girl's education in rural areas, has increased over the
past few years. Rise in enrolment in higher education will
increase demand for institutes over the medium term.
GEWS was set up in 2008 by Rawal and Goyal families based in
Faridabad (Haryana) to impart education in engineering and
management streams. The society set up Rawal Institute of
Engineering and Technology and Rawal Institute of Management in
2010 in Faridabad. In 2012, it also started Rawal Institute of
Education. Courses are approved by the All India Council for
Technical Education, while the institutes are affiliated to
Maharshi Dayanand University, Rohtak (Haryana). There society has
eight members, with Mr. Mahendra Goyal as president.
HARVIN IMPEX: CRISIL Reaffirms 'C' Rating on INR7.5MM LT Loan
-------------------------------------------------------------
CRISIL has reaffirmed its 'CRISIL C/CRISIL A4' ratings on the bank
loan facilities of Harvin Impex Private Limited (HIPL).
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Cash Credit 4 CRISIL C (Reaffirmed)
Letter of Credit 3.5 CRISIL A4 (Reaffirmed)
Proposed Long Term
Bank Loan Facility 7.5 CRISIL C (Reaffirmed)
The ratings continue to reflect the company's modest scale of
operations, low operating margin, and working capital-intensive
operations. The ratings also factor its weak financial risk
profile and liquidity, with insufficient accrual to meet term debt
obligation. These weaknesses are partially offset by its
promoters' extensive experience in the fragmented fibre board
trading business.
Key Rating Drivers & Detailed Description
Weaknesses
* Modest scale of operations and low operating margin in the civil
construction industry: With revenue of INR8.74 crore and operating
margin of 9.94% in fiscal 2016, scale remains small in the
fragmented fiber board trading industry.
* Working capital-intensive operations: Gross current assets were
694 days as on March 31, 2017, due to large receivables and
inventory of 113 and 602 days.
* Weak financial risk profile: Networth was modest at of INR2.06
crore as on March 31, 2017, against total debt of INR17.51 crore,
leading to high gearing of 8.48 times. Debt protection metrics
were weak because of negative cash accrual.
* Insufficient cash accrual to meet term debt obligation: Cash
accrual is expected to be negative against term debt obligation of
INR0.8 crore in fiscal 2018. The debt obligation is expected to be
funded through promoters' funds.
Strengths
* Longstanding experience of promoters in trading in boards: The
promoters have been trading in medium-density fibre (MDF) and
high-density fibre (HDF) boards since 1975 through partnership
firm Associate Timbers, which has been merged with HIPL (erstwhile
Narmada Bearings Pvt Ltd). The company imports MDF and HDF boards
from New Zealand and sells them in the domestic market. The
promoters' experience has helped establish relationships with
suppliers based in New Zealand and Turkey, ensure timely supply
and favourable trade terms, and maintain a diversified customer
base.
Set up in 1989 by Mr Devinder Ajmani and his family members, HIPL
trades in MDF and HDF. Its office is in New Delhi.
KANORIA SUGAR: Ind-Ra Assigns 'D' Long-Term Issuer Rating
---------------------------------------------------------
India Ratings and Research (Ind-Ra) has assigned Kanoria Sugar and
General Manufacturing Company Limited (KSGM) a Long-Term Issuer
Rating of 'IND D'. The instrument-wise rating actions are:
-- INR382.4 mil. Working capital term loans (long-term) due on
December 2023 assigned with IND D rating; and
-- INR316.1 mil. Fund-based limit (long-/short-term) assigned
with IND D rating; and
-- INR24.0 mil. Non-fund-based limit (short-term) assigned with
IND D rating.
KEY RATING DRIVERS
The ratings reflect delays in debt servicing by KSGM over the
three months ended November 2017 owing to a weak liquidity
position
RATING SENSITIVITIES
Positive: Timely debt servicing for at least three consecutive
months may result in a positive rating action.
COMPANY PROFILE
KSGM, formerly Shankar Sugar Mills, was established in 1934 by
late Mr Indra Chandra Kejriwal. It was acquired by Kanoria
Industries Ltd in 1956. It is engaged in the processing of sugar
and manufacturing of air conditioning pressure pipes.
MAGNUM STEELS: CRISIL Withdraws B Rating on INR5.5MM LT Loan
------------------------------------------------------------
CRISIL has been consistently following up with Magnum Steels
Limited (Magnum) for obtaining information through letters and
emails dated Jan. 20, 2017, and Feb. 10, 2017, among others, apart
from telephonic communication. However, the issuer has remained
non cooperative.
CRISIL gave these ratings:
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Cash Credit 5 CRISIL B/Stable (Issuer Not
Cooperating; Rating
Withdrawal)
Letter of credit & 2 CRISIL A4 (Issuer Not
Bank Guarantee Cooperating; Rating
Withdrawal)
Proposed Long Term 5.5 CRISIL B/Stable (Issuer Not
Bank Loan Facility Cooperating; Rating
Withdrawal)
The investors, lenders and all other market participants should
exercise due caution while using the rating assigned/reviewed with
the suffix 'ISSUER NOT COOPERATING'. These ratings lack a forward
looking component as it is arrived at without any management
interaction and is based on best available or limited or dated
information on the company'.
Detailed Rationale
Despite repeated attempts to engage with the management, CRISIL
failed to receive any information on either the financial or
strategic intent of Magnum. This restricts CRISIL's ability to
take a forward looking view on the credit quality of the entity.
CRISIL believes that the information available for the firm is
consistent with 'Scenario 1' outlined in the 'Framework for
Assessing Consistency of Information' corresponding to CRISIL BB
rating category or lower. Based on the last available information,
the rating on bank facilities of Magnum continues to be 'CRISIL
B/Stable/CRISIL A4; Issuer not cooperating'.
CRISIL has withdrawn its ratings on the bank facilities of Magnum
at the company's request and on receipt of a no dues certificate
from its banker, State Bank of India. The rating action is in line
with CRISIL's policy on withdrawal of bank loan ratings.
Magnum was set up in 1991 as a private limited company, and was
reconstituted as a closely held public company in 1995. It
manufactures spring steel flats, high-strength deformed steel
bars, and thermo-mechanically-treated bars through the electric
arc process. It also trades in agricultural products. As part of
its backward integration programme, it acquired Delux Alloys in
fiscal 1991 and Magnum Iron & Steel Private Limited in 1997. The
acquired entities manufacture ingots and billets used as raw
material by Magnum.
MURLIDHAR AGRO: CARE Lowers Rating on INR7cr LT Loan to 'D'
-----------------------------------------------------------
CARE Ratings revised the ratings on certain bank facilities of
Murlidhar Agro Food Private Limited (MAFPL), as:
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long-term Bank 7.00 CARE D; Issuer not
Facilities cooperating; Revised
from CARE B+; Stable
on the basis of best
available information
CARE has been seeking information from MAFPL to monitor the
rating(s) vide e-mail communications/ letters dated April 26,
2017, August 9, 2017, August 18, 2017, August 29, 2017,
September 14, 2017, October 12, 2017, October 27, 2017,
December 5, 2017 and numerous phone calls. However, despite CARE's
repeated requests, the entity has not provided the requisite
information for monitoring the ratings.
In line with the extant SEBI guidelines, CARE has reviewed the
rating on the basis of the publicly available information
which however, in CARE's opinion is not sufficient to arrive at a
fair rating. Hence, CARE's rating on Murlidhar Agro Food
Private Limited's bank facilities will now be denoted as CARE D;
ISSUER NOT COOPERATING.
Users of this rating (including investors, lenders and the public
at large) are hence requested to exercise caution while using the
above rating.
Detailed description of the key rating drivers
Ongoing delays in Debt servicing
The revision in the rating assigned to the bank facilities of
Murlidhar Agro Food Private Limited is primarily due to
irregularity in servicing its debt obligations.
Areri, Kheda (Gujarat)-based Murlidhar Agro Food Pvt Ltd. (MAFPL)
was established as a private limited company in 2005. MAFPL is
engaged in the manufacturing of grain mill products i.e. Rice. The
company sells its Basmati rice under the brand name of 'Rat Rani'
and 'Pilar'. The company sells its entire production in the
domestic market. Mr. Hiteshbhai B Patel, director, who has an
experience of thirty one years, manages the overall operations of
the company. He is assisted by Mr Kamleshbhai Patel, aged 36
years, who is also director of MAFPL, who has an experience of
more than a decade manages overall operations of the company. Its
plant, located at Areri is spread across 87120 Sq. feet area. The
products manufactured by MAFPL are used by entities dealing into
the trading of food products.
MUTHA INDUSTRIES: ICRA Removes 'B' Rating From Not Cooperating
--------------------------------------------------------------
ICRA has removed its earlier ratings of [ICRA]B (Stable) and
[ICRA]A4 from the 'ISSUER NOT COOPERATING' category as Mutha
Industries Private Limited has now submitted its 'No Default
Statement' ("NDS") which validates that the company is regular in
meeting its debt servicing obligations. The company's ratings were
moved to the 'ISSUER NOT COOPERATING' category in November 2017.
The ratings take into account MIPL's limited operational track
record and limited experience of the promoters in the industry,
small scale of current operations, and weak financial profile as
reflected by an adverse capital structure and subdued level of
coverage indicators. The ratings are further constrained by the
company's high working capital intensity of operations, which
exerts pressure on the liquidity position. Moreover, the company
continues to be dependent on borrowings from group entities and
promoters for timely servicing of its debt obligations since the
cash flows from the business remained inadequate. However, ICRA
notes that the interest-free unsecured loan from group entities
and promoters, a part of which cannot be withdrawn without the
repayment of bank term loans, provides some comfort.
The ratings also derive comfort from the company's presence in a
major bamboo-growing region, which ensures easy availability of
bamboo and low landed cost of raw material. Besides, the company
witnessed growth in the top-line during the last fiscal, and has
an outstanding order book of about INR11 crore, which ensures
revenue visibility in the near term, at least. The ratings also
take note of MIPL's entitlement to various fiscal benefits, which
is likely to support cash flows, going forward. However, timely
receipt of the same remains a concern.
PANORAMA ELECTRONICS: CRISIL Assigns B+ Rating to INR7MM Loan
-------------------------------------------------------------
CRISIL has assigned its ratings on the bank facilities of Panorama
Electronics Private Limited (PEPL) to 'CRISIL B+/Stable/CRISIL
A4'.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Proposed Long Term
Bank Loan Facility 0.19 CRISIL B+/Stable
Letter of credit &
Bank Guarantee 3.10 CRISIL A4
Bank Guarantee 7.21 CRISIL A4
Cash Credit 7.00 CRISIL B+/Stable
The rating reflects modest scale of operations, working capital-
intensive operations and intense competition, leading to low
operating profitability. These rating weakness are partially
offset extensive experience of the promoters in the electronics
division and moderate financial risk profile.
Key Rating Drivers & Detailed Description
Weakness
* Modest scale of operations: The scale of operations has improved
from INR7.5 crore in fiscal 2016 to INR24.4 crore in fiscal 2017,
but remains modest owing to geographical concentration within
various districts of West Bengal.
* Working capital-intensive operations: Gross current assets of
320-410 days were recorded in last three years through 2017,
driven by high inventory and loans and advances in the form of
retention money required to be maintained by the company.
* Intense competition leading to low operating profitability:
Competition with other players, such as Micromax, Vivo, Xiaomi,
Lenovo, OnePlus, and Gionee and established players, such as
Samsung, Apple, Sony, HTC, and Blackberry has led to intense
competition in the market thereby constraining the overall
operating profitability.
Strengths
* Extensive industry experience of the promoters in the electronic
division: The promoters have been in the business for more than
three decades, involved in manufacturing of electronic products,
marketing and manpower services prior to providing Security System
Installtaion work and dealership of Oppo mobiles. The company is
involved in dealership of various other electronic products
through its other associate companies. The extensive experience of
the promoters has enbaled PEPL to develop a network of more than
250 customers around various districts of West Bengal.
* Moderate financial risk profile: The financial risk profile is
marked by moderate networth of INR9.7 crore in fiscal 2017,
gearing was low at 0.23 time as on March 31, 2017, due to low
reliance on external debt to meet the working capital requirement
and debt protection matrices has remained average with interest
coverage and net cash accrual to total debt (NCATD) of 2.83 times
and 0.99 time, respectively, for fiscal 2017.
Outlook: Stable
CRISIL believes PEPL will continue to benefit from the extensive
industry experience of its promoters and established relationship
with its key suppliers. The outlook may be revised to 'Positive'
if increase in profitability leads to better-than-expected cash
accrual and strengthens the financial risk profile. The outlook
may be revised to 'Negative' if there is decline in revenue
because of reduction in Oppo's market share, low cash accrual or
if any large debt-funded capital expenditure weakens the financial
risk profile.
PEPL incorporated on Jan. 15, 1985 is a Kolkata based company,
involved in installation of system integration, distribution,
installation and maintenance of telecom, security, audio-visual
systems and digital wall systems majorly for West Bengal Police
and Government bodies.
The company also started distribution of Oppo Smartphones since
October 2016. Oppo Smartphones are supplied in various districts
of West Bengal.
RAGHAV INDUSTRIES: CARE Assigns B+ Rating to INR10cr Loan to B+
--------------------------------------------------------------
CARE Ratings has assigned rating to the bank facilities of Raghav
Industries (RIN), as:
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long term Bank
Facilities 10.00 CARE B+; Stable Assigned
Detailed Rationale and key rating drivers
The rating assigned to the bank facilities of RIN is constrained
by its small scale of operations with low net-worth base & low
profitability margins, leveraged capital structure and elongated
operating cycle. The rating is further constrained by
susceptibility of margins to fluctuations in raw material prices,
fragmented nature of industry, foreign exchange fluctuation risk
and partnership nature of its constitution. The rating, however,
derives strength from experienced partners and favorable location
of plant.
Going forward, the ability of the firm to increase the scale of
operations while improving its profitability margins and overall
solvency position would remain the key rating sensitivity.
Detailed description of the key rating drivers
Key Rating Strengths
Experienced partners in the agro processing industry: RIN was
established in May 2005 as a partnership firm and is currently
being managed by Mr. Rakesh Kumar, Mr. Mukesh Garg and Mrs. Sumita
Gipta. Mr. Rakesh Kumar and Mr. Mukesh Garg have total work
experience of around two decades each in agro processing industry
through their association with RIN and other firms (Sita ram and
sons) engaged in similar business.
Favorable location of plant: RIN's manufacturing unit is located
in Karnal, Haryana. The area is one of the hubs for paddy/rice,
leading to its easy availability. The presence of RIN in the
vicinity of paddy producing regions gives it an advantage over
competitors operating elsewhere in terms of easy availability of
the raw material as well as favorable pricing terms.
Key Rating Weaknesses
Small scale of operations with low net-worth base and low
profitability margins: Despite being in operations for more than
one decade, the firm's scale of operations has remained small
marked by Total Operating Income (TOI) of INR40.54 crore in FY17
(refers to the period April 01 to March 31) and net-worth base of
INR2.76 crore as on March 31, 2017. Additionally, the PBILDT
margins have been on the lower side owing to firm's presence in
highly fragmented and competitive industry. Further, high interest
and depreciation cost also restricted the net profitability of RIN
and resulted into below unity PAT margin during last three
financial years.
Leveraged capital structure: RIN has a leveraged capital structure
marked by overall gearing ratio of 3.61x as on
March 31, 2017 on account of high dependence upon borrowings to
fund working capital requirements of business. Furthermore, total
debt to GCA stood weak at 17.38x for FY17. However, interest
coverage ratio stood moderate at 3.14x in FY17. The same improved
from 1.54x in FY16 due to decline in interest expenses.
Elongated operating cycle: The operating cycle of the firm stood
elongated at 93 days for FY17. The firm is required to maintain
adequate inventory of raw material to ensure smooth execution
process, which resulted in average inventory period of 76 days for
FY17. Furthermore, the firm provides credit period of around one
month to its customers, which led to average collection period of
19 days for FY17. The average utilization of the cash credit limit
stood at ~30% for the last 12 months period ended September 2017.
Susceptibility to fluctuation in raw material prices and monsoon
dependent operations Agro-based industry is characterized by its
seasonality, due to its dependence on raw materials whose
availability is affected directly by the vagaries of nature. The
price of rice moves in tandem with the prices of paddy.
Availability and prices of agro commodities are highly dependent
on the climatic conditions. Adverse climatic conditions can affect
their availability and leads to volatility in raw material prices.
Foreign currency fluctuation risk The income from exports
constituted approx. 20% of the total income in FY17. With cash
outlay for sales in domestic currency & chunk of sales realization
in foreign currency and in the absence of any hedging mechanism,
the company is exposed to the fluctuation in exchange rates.
Fragmented nature of industry coupled with high level of
government regulation: The commodity nature of the product makes
the industry highly fragmented with numerous players operating in
the unorganized sector with very less product differentiation.
Furthermore, the raw material (paddy) prices are regulated by
government to safeguard the interest of farmers, which in turn
limits the bargaining power of the rice millers.
Partnership nature of constitution: RIN's constitution as a
partnership firm has the inherent risk of possibility of
withdrawal of the partners' capital at the time of personal
contingency and firm being dissolved upon the
death/retirement/insolvency of partner(s). Moreover, partnership
firms have restricted access to external borrowing as credit
worthiness of partners would be the key factors affecting credit
decision of the lenders.
Raghav Industries was established as a partnership firm in 2005
and it is currently being managed by Mr. Rakesh Kumar, Mr. Mukesh
Garg and Mrs. Sumita Gupta sharing profits and losses in the ratio
of 35%, 35% and 30% respectively. The firm is engaged in
processing of paddy at its manufacturing facility located in
Nadana, Karnal with an installed capacity of 6,000 Tonnes of paddy
per annum as on September 30, 2017. It is also engaged in trading
of basmati and non-basmati rice. RIN sells rice primarily to
various rice wholesalers. Furthermore, the firm is also engaged in
the export of rice to Saudi Arabia (income from export constituted
20% of the total sales in FY17).
ROSE METAL: Ind-Ra Migrates B Issuer Rating to Non-Cooperating
--------------------------------------------------------------
India Ratings and Research (Ind-Ra) has migrated Rose Metal's (RM)
Long-Term Issuer Rating to the non-cooperating category. The
issuer did not participate in the surveillance exercise despite
continuous requests and follow-ups by the agency. Therefore,
investors and other users are advised to take appropriate caution
while using these ratings. The rating will now appear as 'IND
B(ISSUER NOT COOPERATING)'on the agency's website. The instrument-
wise rating actions are:
-- INR60.0 mil. Fund-based working capital limit migrated to
non-cooperating category with IND B(ISSUER NOT
COOPERATING)/INDA4(ISSUER NOT COOPERATING) rating; and
-- INR120.0 mil. Non-fund-based working capital limit migrated
to non-cooperating category with INDA4(ISSUER NOT
COOPERATING) rating.
Note: ISSUER NOT COOPERATING: The ratings were last reviewed on
Dec. 5, 2016. Ind-Ra is unable to provide an update, as the agency
does not have adequate information to review the ratings.
COMPANY PROFILE
Incorporated in 1979, RM is a Mumbai-based proprietorship concern
engaged in the trading of ferrous and non-ferrous metals such as
steel pipes, tubes, aluminium, nickel alloy, copper, brass and
other related products. Its head office is in Mumbai. In addition,
it has warehouses in Bhiwandi, Thane and Lucknow.
RUCHI SOYA: NCLT Orders Initiation of Insolvency Proceedings
------------------------------------------------------------
MoneyControl.com reports that Ruchi Soya Industries on Dec. 19
said that insolvency proceeding has been initiated against the
company and the powers of its board have been suspended.
On December 9, the company had said that petitions filed by
Standard Chartered Bank and DBS Bank against Ruchi Soya Industries
before the National Company Law Tribunal (NCLT), Mumbai have been
admitted, the report says.
MoneyControl.com relates that in a filing to the BSE, Ruchi Soya
said that pursuant to an order of the NCLT, Mumbai Bench,
"Corporate Insolvency Resolution Process (CIRP) has been initiated
for the company as per the provisions of the Insolvency and
Bankruptcy Code".
Shailendra Ajmera of Ernst & Young has been appointed as Interim
Resolution Professional (IRP) to carry the functions as mentioned
under IBC Insolvency and Bankruptcy Code, MoneyControl.com
discloses.
"Upon initiation of CIRP, the powers of the board of directors of
the company have been suspended and shall be exercised by the
IRP," the filing said, the report relays.
Ruchi Soya Industries Ltd. is engaged in crushing of oil seeds
and extraction/refining of edible oil along with manufacturing of
related products like vanaspati and textured proteins. It is also
engaged in import/export as well as domestic trading of various
agri-commodities. It is the flagship entity of the Indore, Madhya
Pradesh based Ruchi Group, which has business interests spread
across various sectors including edible oil, agri-commodity
trading, liquid and dry storage warehousing for agri-products and
real estate. RSIL has manufacturing presence at 20 locations
across India.
SAALIM SHOES: CRISIL Withdraws D Rating on INR35MM Packing Loan
---------------------------------------------------------------
CRISIL has been consistently following up with Saalim Shoes
Private Limited (SSPL) for obtaining information through letters
and emails dated May 24, 2017, and June 7, 2017, among others,
apart from telephonic communication. However, the issuer has
remained non cooperative.
CRISIL gave these ratings:
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Bill Discounting 20 CRISIL D (Issuer Not
Cooperating; Rating
Withdrawal)
Cash Credit 5 CRISIL D (Issuer Not
Cooperating; Rating
Withdrawal)
Corporate Loan 1.54 CRISIL D (Issuer Not
Cooperating; Rating
Withdrawal)
Packing Credit 35.00 CRISIL D (Issuer Not
Cooperating; Rating
Withdrawal)
Proposed Long Term 0.43 CRISIL D (Issuer Not
Bank Loan Facility Cooperating; Rating
Withdrawal)
Term Loan .03 CRISIL D (Issuer Not
Cooperating; Rating
Withdrawal)
The investors, lenders and all other market participants should
exercise due caution while using the rating assigned/reviewed with
the suffix 'ISSUER NOT COOPERATING'. These ratings lack a forward
looking component as it is arrived at without any management
interaction and is based on best available or limited or dated
information on the company.
Detailed Rationale
Despite repeated attempts to engage with the management, CRISIL
failed to receive any information on either the financial
performance or strategic intent of SSPL. This restricts CRISIL's
ability to take a forward looking view on the credit quality of
the entity. CRISIL believes that the information available for the
firm is consistent with 'Scenario 1' outlined in the 'Framework
for Assessing Consistency of Information' corresponding to CRISIL
BB rating category or lower. Based on the last available
information, the rating on bank facilities of SSPL continues to be
'CRISIL D/CRISIL D; Issuer not cooperating'.
CRISIL has withdrawn its ratings on the bank facilities of SSPL at
the company's request and based on the no objection certificate
received from the banker. The rating action is in-line with
CRISIL's policy on withdrawal of bank loan ratings.
Set up in 2001, SSPL is an integrated manufacturer and exporter of
leather shoes. Based out of Ranipet (Tamil Nadu), the day-to-day
activities of the company are managed by Mr. Mohammed Saalim.
SAVEMAX WHOLESALE: CARE Lowers Rating on INR155.23cr Loan to D
--------------------------------------------------------------
CARE Ratings revised the ratings on certain bank facilities of
Savemax Wholesale Club Pvt. Ltd (SWCPL), as:
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long term Bank 155.23 CARE D; Issuer Not
Facilities Cooperating; Revised
from CARE BBB; Negative
on the basis of best
available information
Short term Bank 72.00 CARE D; Issuer not
Facilities cooperating; Revised
from CARE A3 on the
basis of best available
information
CARE has been seeking information from SWCPL to monitor the
rating(s) vide e-mail communications dated December 6, 2017,
December 4, 2017, December 1, 2017, November 30, 2017,
November 17, 2017, November 7, 2017, November 4, 2017 and numerous
phone calls. However, despite CARE's repeated requests, the
company has not provided the requisite information for monitoring
the ratings. In line with the extant SEBI guidelines, CARE has
reviewed the rating on the basis of the publicly available
information which however, in CARE's opinion is not sufficient to
arrive at a fair rating. The rating on SWCPL's bank facilities
will now be denoted as CARE D; ISSUER NOT COOPERATING.
Users of this rating (including investors, lenders and the public
at large) are hence requested to exercise caution while using the
above rating(s).
The revision in the ratings assigned to the bank facilities of
Savemax Wholesale Club Private Limited (SWCPL) takes into account
ongoing delays in debt servicing by the company.
SWCPL (formerly known as Golden India Expo-trade Private Limited)
was established in 2007, and is engaged in trading of agro based
commodities and also runs 5 retail stores (1 in Delhi, 2 in
Haryana, 1 in UP and 1 in Punjab), selling FMCG products,
footwear, apparels and daily need products.
SHREE SIDDHESHWAR: CRISIL Hikes Rating on INR200MM Credit to B+
---------------------------------------------------------------
CRISIL Ratings has upgraded its rating to the Long Term bank
facility of Shree Siddheshwar Sahakari Sakhar Karkhana Limited
(SSSSKL) to 'CRISIL B+/Stable' from 'CRISIL B/Stable'.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Cash Credit 200 CRISIL B+/Stable (Upgraded
from 'CRISIL B/Stable')
Sugar Pledge 25.15 CRISIL B+/Stable (Upgraded
Cash Credit from 'CRISIL B/Stable')
Rupee Term Loan 114.85 CRISIL B+/Stable (Upgraded
from 'CRISIL B/Stable')
The rating upgrade reflects expected improvement in the business
risk profile, driven by significantly higher sugar cane crushing,
moderate recovery and commencement of co-gen plant. During fiscal
2017, the society has successfully enhanced its sugar cane
crushing capacity to 7500 metric ton per day (MTPD) from 5000
MTPD. With capacity augmentation and higher sugar cane
availability in command area, society is likely to crush about 11
lakh MT of sugar cane during current sugar season against 5 lakh
MT in previous year. Furthermore, the 38 MW co-gen plant is also
operational from current sugar season which will further support
the revenue and earnings or profitability of the society along
with firmed or sustained sugar prices.
The rating continues to reflect society's average capital
structure, large working capital requirement and exposure to
regularity risks. These weaknesses are partially offset by
society's established presence in sugar industry, its fully
integrated operations and positive outlook on sugar industry.
Analytical Approach
For arriving at its rating, CRISIL has treated interest-bearing
deposits of INR64.52 crore received from its members as neither
debt nor equity, as these deposits are having maturity tenure of
more than five years and carries lower interest rate than market.
Key Rating Drivers & Detailed Description
Weakness
* Working capital-intensive operations: The large working capital
requirement constrains its liquidity; its estimated gross current
assets will be over 300 days as on March 31, 2018, because of
large inventory holding.
* Below-average capital structure: The networth has deteriorated,
due to cash losses during fiscal 2017. Large bank debt availed to
fund working capital requirement and term loans contracted for
capex will keep the gearing high over the medium term.
* Exposure to regulatory changes and cyclicality in sugar
industry: The sugar manufacturing industry is highly regulated and
is also exposed to risks related to seasonality in sugarcane
production. These factors can impact the scale of operations and
margin.
Strength
* Established market position in sugar industry and healthy
relations with member-farmers: The society has established
presence in the Maharashtra sugar industry since 1971 and has
command area which is spread over across Maharashtra and
Karnataka. The society has more than 28000 farmers as members
ensuring about 15 lakh tonne of sugar cane availability.
* Integrated operations and favorable outlook on sugar industry:
The society produces sugar and by-products, such as rectified
spirit, ethanol through distillery and power through newly set up
co-gen plant. Fully integrated operations and healthy margin
estimated on by-products will enable the society to record better
operating performance over medium term. Furthermore, sustained
sugar prices and favourable demand-supply scenario should benefit
the society in near to medium term.
Outlook: Stable
CRISIL believes that SSSSKL will continue to benefit from its
established relationships with farmers in the command area, and
integrated operations. The outlook may be revised to 'Positive' if
significant improvement in cash accrual, supported by improved
revenue and operating margin leads to a sustainably stronger
capital structure for the society. The outlook may be revised to
'Negative' if the financial risk profile, particularly liquidity,
weakens on account of low cash accrual or a stretch in the working
capital cycle caused by large inventory.
SSSSKL, based in Solapur, Maharashtra was established in 1971 by
Late Mr Appasaheb Kadadi. The society is managed by Mr. Dharmraj
Kadadi along with an elected board of directors. The society has
its plant at Kumthe, Maharashtra with installed capacity of 7500
tonne crushing per day (TCD). Also, it has distillery with 20
kilolitre per day capacity. Furthermore, the society entered an
agreement with Maharashtra State Electricity Distribution Company
Limited to set up and operate 38 mega-watt (MW) co-gen plant,
which commenced commercial operations in sugar season of fiscal
2018.
SREE ANJANEYA: CRISIL Assigns B- Rating to INR3.5MM Loan
--------------------------------------------------------
CRISIL has assigned its 'CRISIL B-/Stable/CRISIL A4' ratings on
the bank facilities of Sree Anjaneya Exports - Tirupur (SAE).
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Term Loan 0.3 CRISIL B-/Stable
Proposed Long Term
Bank Loan Facility 0.7 CRISIL B-/Stable
Bill Purchase-
Discounting Facility 1.5 CRISIL A4
Export Packing Credit 3.5 CRISIL B-/Stable
The ratings reflect a small scale, exposure to intense
competition, and weak financial risk profile, constrained by high
gearing and below-average debt protection metrics with sizable
loans and advances to group companies. These weaknesses are
partially offset by partners' extensive experience and established
relationships with overseas customers.
Key Rating Drivers & Detailed Description
Weaknesses
* Small scale, working capital-intensive operations, and exposure
to intense competition: Scale is small, with revenue of INR9.35
crore for fiscal 2017. Working capital requirements are high as
reflected in gross current assets of 462 days, with sizable
inventory of 290 days as on March 31, 2017. Intense competition
due to the presence of several small regional and large players in
the segment limits the pricing flexibility with customers.
* Weak financial risk profile: Financial risk profile is weak with
small networth of INR1.49 crore and high gearing of 6.47 times as
on March 31, 2017, and weak debt protection metrics, with interest
coverage and net cash accrual to total debt ratios of 1.07 times
and -0.2 time, respectively, for fiscal 2017. Further it has also
extended sizable loans and advances to group companies
Strength
* Partners' extensive experience: The partners' experience of over
two decades in the textile industry has helped SAE develop strong
relationships with local suppliers and overseas customers, and
this should support the business risk profile.
Outlook: Stable
CRISIL expects the business risk profile to remain constrained by
working capital-intensive operations. The outlook may be revised
to 'Positive,' if scaling up of operations and profitability and
efficient working capital management strengthen the financial risk
profile and liquidity. The outlook may be revised to 'Negative' if
poor working capital management or larger-than-expected, debt-
funded capital expenditure weakens liquidity.
Established in 1997 as a partnership between Mr Duraysamy and Mr
CK Balasubramaniyam, SAE manufactures and exports readymade
garments. Its manufacturing facility is in Tirupur, Tamil Nadu.
STEEL PRODUCTS: CRISIL Lowers Rating on INR11.5MM Loan to B-
------------------------------------------------------------
CRISIL has downgraded its rating on the long-term bank facility of
Steel Products Limited (SPL) to 'CRISIL B-/Stable' from 'CRISIL
B/Stable', and reaffirmed the short-term rating at 'CRISIL A4'.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Bank Guarantee 10 CRISIL A4 (Reaffirmed)
Cash Credit 11.5 CRISIL B-/Stable (Downgraded
from 'CRISIL B/Stable')
Letter of Credit 1.15 CRISIL A4 (Reaffirmed)
The downgrade reflects stretch in liquidity because of high bank
limit utilization in the last 12 months through November, 2017 at
around more than 99%. Limits were fully utilized in the eight
months ended November 2017, which is mainly because of large
working capital cycle as reflected in high GCA days of around 210-
325 days in last three years through fiscal 2017.
The ratings reflect SPL's working capital-intensive operations and
weak financial risk profile because of small networth and high
gearing. These weaknesses are partially offset by the extensive
experience of its promoters in the transmission tower industry.
Key Rating Drivers & Detailed Description
Weaknesses
* Working capital-intensive operations: Gross current assets have
been in the 185-325 days' range in the four years ended March 2017
due to large inventory and stretched receivables. Hence, bank
limit was utilised at 99.3% in the 12 months ended November 2017.
* Weak financial risk profile: Networth was small at INR4.3 crore
as on March 31, 2017, due to muted accretion to reserves and high
bank limit utilisation, which led to high gearing of 2.6 times.
Debt protection metrics also remained below average, with interest
coverage and net cash accrual to total debt ratios of 1.32 times
and 0.14 time, respectively, for fiscal 2017.
Strength
* Extensive experience of promoters: Presence of over two decades
in the transmission tower industry has enabled the promoters to
establish strong relationship with power transmission corporations
in Uttar Pradesh and West Bengal, and Power Grid Corporation of
India Ltd, from which it gets regular orders. SPL also has a
strategic alliance with HG Power Transmission, a leading turnkey
solution provider for transmission lines in Malaysia, from which
it gets export orders (40-50% of total revenue).
Outlook: Stable
CRISIL believes SPL will continue to benefit over the medium term
from its long track record in the transmission tower industry. The
outlook may be revised to 'Positive' if substantial improvement in
working capital cycle, scale of operations, profitability, and
capital structure strengthens key credit metrics. The outlook may
be revised to 'Negative' if financial risk profile, especially
liquidity, deteriorates because of large incremental working
capital requirement, low cash accrual, or substantial
unanticipated capital expenditure.
Incorporated in 1917, SPL manufactures steel structures and parts
of transmission towers and telecom towers; and also sub-station
structures. The company also installs optical electricity cables
for transmission towers.
THERMAL FABRICATORS: CRISIL Reaffirms B+ Rating on INR3MM Credit
----------------------------------------------------------------
CRISIL has reaffirmed its ratings on the bank facilities of
Thermal Fabricators Private Limited (TFPL) at 'CRISIL
B+/Stable/CRISIL A4'.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Cash Credit 3 CRISIL B+/Stable (Reaffirmed)
Letter of Credit 5.50 CRISIL A4 (Reaffirmed)
Term Loan 0.83 CRISIL B+/Stable (Reaffirmed)
The ratings continue to reflect TFPL's modest scale of and working
capital intensive operations. These weaknesses are partly offset
by the extensive experience of the company's promoter in timber
processing and average financial risk profile.
Key Rating Drivers & Detailed Description
Weakness
* Small scale of operations susceptible to intense competition in
timber industry: Intense competition in the industry keeps TFPL's
scale of operations small as reflected in revenues of INR10 crore
for fiscal 2017. The small scale of operations reduces the
bargaining power with suppliers as well as customers and exerts
pressure on its operating margin. However, the scale of operations
is expected to improve due to the launch of value-added products
under its brand 'Artisan'.
* Working capital intensive operations: Operations are working
capital intensive with gross current assets of 265 days as on
March 31, 2017 driven by high inventory days of 200. TFPL had
imported timber in anticipation of the price rise due to revision
in Government policy on fumigation of imported timber. However,
working capital requirement is partially supported by high letter
of credit (LC)-backed creditors.
Strengths
* Extensive experience of the promoter: Benefits from the
promoter's two-decade long experience in the industry,
geographical diversification and established relationships with
customers should support business.
* Average financial risk profile: Funding support extended by the
promoter improved total outside liabilities to tangible networth
ratio to 2.28 times as on March 31, 2017. Furthermore, improvement
in operating margin and capital structure strengthened debt
protection metrics. Networth was however modest at INR2.5 crore as
on March 31, 2017.
Outlook: Stable
CRISIL believes TFPL will continue to benefit from the extensive
experience of its promoter. The outlook may be revised to
'Positive' if scale of operations or profitability increases due
to inclusion of value-added products and high cash accrual
strengthens financial risk profile. The outlook may be revised to
'Negative' if stretch in working capital cycle or large debt-
funded capital expenditure weakens financial risk profile.
Incorporated in 1975 and based in Thane (Maharashtra), TFPL
manufactures wooden doors, door frames, flooring, and decking. It
also processes timber and trades in imported timber. TFPL is
promoted and managed by Mr Sanjay Deorah.
TILAK EXPORTS: CRISIL Lowers Rating on INR7MM Packing Loan to D
---------------------------------------------------------------
CRISIL Ratings has downgraded its ratings on the bank facilities
of Tilak Exports (TE) to 'CRISIL D/CRISIL D' from 'CRISIL
B/Stable/CRISIL A4'.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Bill Discounting 3 CRISIL D (Downgraded from
'CRISIL B/Stable')
Letter of Credit 2 CRISIL D (Downgraded from
'CRISIL A4')
Packing Credit 7 CRISIL D (Downgraded from
'CRISIL A4')
Proposed Long Term 0.15 CRISIL D (Downgraded from
Bank Loan Facility 'CRISIL B/Stable')
Term Loan 3.85 CRISIL D (Downgraded from
'CRISIL B/Stable')
The downgrade reflects instances of delays in servicing its term
loan, letter of credit and packing credit facilities, because of
weak liquidity, leading to cash flow mismatches.
The ratings continue to reflect the modest scale of operations,
weak financial risk profile and working capital intensity in
operations. These weaknesses are partially offset by extensive
experience of the promoters in the readymade garments
manufacturing business.
Key Rating Drivers & Detailed Description
Weakness
* Delay in servicing debt: The firm has not yet paid its term loan
instalment due in October 2017. Interest payment on the packing
credit limit has been outstanding for over 30 days. Letter of
credit of INR2.0 crore has also devolved in the last six months.
Delay in payments has been due to stretched receivables from
overseas customers.
* Weak Financial risk profile: The firm continues to have a
stretched capital structure and modest debt protection metrics
* Large working capital requirements: Operations are highly
working capital intensive, as reflected in gross current assets of
359 days, driven by inventory and receivables of 191 and 76 days,
respectively, as on March 31, 2017.
Strength
* Extensive experience of the promoters: The two and half decade-
long experience of the promoters, in the garment production and
exports business, and their active involvement in functional areas
of the business, will continue to support the business risk
profile.
TE was set up as a partnership firm by Ms Manju Farsaiya in 1988,
the firm manufactures and exports ladies garments. The
manufacturing facility is located at Noida (Uttar Pradesh).
Net profit of INR0.13 crore was reported on net sales of INR22.43
crore, respectively, for fiscal 2017, vis-a-vis INR0.33 crore and
INR24.91 crore, respectively, in fiscal 2016.
TRANFORMEX FERROUS: CARE Lowers Rating on INR4.64cr Loan to D
-------------------------------------------------------------
CARE Ratings revised the ratings on certain bank facilities of
Tranformex Ferrous Private Limited (TFPL), as:
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long-term Bank 4.64 CARE D; ISSUER NOT
Facilities COOPERATING Revised
from CARE B; ISSUER NOT
COOPERATING
Detailed Rationale & Key Rating Drivers
Ongoing delays in Debt servicing: The revision in the rating
assigned to the bank facilities of TFPL is primarily due to
irregularity in servicing its debt obligations.
Vadodara (Gujarat) based TFPL incorporated in 2013 is engaged into
the business of recycling of Steel Scrap, TFPL imports Light metal
scraps (LMS) from Istambul, Dubai. LMS comprised of rubber and
steel. TFPL removes the rubber and process the remaining steel it
in order to convert it into Mild Steel Scrap. TFPL is operating
from its sole manufacturing plant located in GIDC Estate,
Ramanamdi(Baroda) with an installed capacity of 12000metric tonnes
per annum (MTPA) for MS Steel Scrap.
VANI ORGANICS: CARE Moves B Rating to Not Cooperating Category
-------------------------------------------------------------
CARE Ratings has been seeking information from Vani Organics
Private Limited (VOPL) to monitor the rating vide e-mail
communications/letters dated May 25, 2017, June 1,2017, June 21,
2017, October 3, 2017, October 5, 2017 and December 1, 2017.
However, despite CARE's repeated requests, the company has not
provided the requisite information for monitoring the rating. In
the absence of minimum information required for the purpose of
rating, CARE is unable to express opinion on the rating. In line
with the extant SEBI guidelines CARE's rating on Vani Organics
Private Limited's bank facilities will now be denoted as CARE B;
ISSUER NOT COOPERATING.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long term Bank 6.50 CARE B; ISSUER NOT
Facilities COOPERATING
Users of this rating (including investors, lenders and the public
at large) are hence requested to exercise caution while using the
above rating.
Detailed description of the key rating drivers
At the time of last rating on July 29, 2016, the following were
the rating strengths and weaknesses:
Key Rating Weaknesses
Weak financial risk profile marked by continuous losses though
company is posting net profit in FY16: The total income of the
company have shown a declining trend from INR2.09 crore in FY13 to
INR1.16 crore in FY15, due to lower number of orders undertaken.
However, the sales of the company increased to INR3.22 crore in
FY16 (Provisional) due to sale of additional products introduced
during the year. The company had incurred continuous losses y-o-y;
the net loss had increased from INR0.75 crore in FY13 to INR2.58
crore in FY15, due to low income and high manufacturing expenses.
Employee cost and power cost formed the major portion of cost of
sales. In FY15, the power cost was substantially high at INR1.37
crore which constituted about 118% of the total operating income,
due to frequent power shut down which resulted in the increased
utilisation of diesel generators.
In FY16 (Provisional), the company was able to achieve a net
profit of INR0.04 crore, due to absorption of fixed cost as the
income of the company increased with increase in orders.
Highly competitive and regulated industry: Indian pharmaceutical
industry is highly fragmented with presence of more than thousands
of players in APIs and formulations. It manufactures about 60,000
generic brands across 60 different therapeutic categories, about
1,500 bulk drugs and almost the entire range of formulations. The
industry is highly fragmented with around 20,000 players, of
which, around 250 in the organized sector primarily in
formulations control over 70% of the total domestic market. All
the products and companies in the pharmaceutical industry are
regulated by several policies and bodies in terms of manufacturing
process, patents, pricing, quality control, safety and health
standards, and several other certifications and control standards.
Any policy changes or regulations by the regulatory bodies may
hamper the business of the companies prevailing in the industry.
Increasing regulation, increased sensitivity towards product
performance and pricing pressure are the key challenges faced by
the pharmaceutical industry.
Customer concentration risk and marketing risk associated with the
proposed addition of new products: VOPL derives 40% of its total
sales from VOP. Other clients like Scientific Limited and Everest
organics Private Limited contribute about 15% and 10% respectively
to the total sales of the company, exposing it to substantial
client concentration risk. Ability of the company to diversify its
revenue base would help reduce the risk of client concentration at
present. However VOP being a group company mitigates the risk to a
certain extent.
VOPL has proposed to add additional products in the near future in
order to increase the scale of operations and make maximum
utilization of the plant installed. The expansion of product base
comes with an inherent risk of marketing in selling the same.
Key Rating Strengths
Long track record of the company and regular support from group
company in the form of work orders received: VOPL has a track
record of over 32 years in the field of bulk drugs and
intermediaries manufacturing. The group company; VPL was
incorporated in the year 1976 there by having a track record of
over 40 years. VOPL receives support from its flagship company,
VPL, by way of work orders. VPL is the major customer of VOPL.
Extensive experience of promoters in the industry: Mr. Mallampatti
Chakradhar is the managing director and main promoter of the
company. He has gained experience in pharma industry by working as
an employee in Aventis India Limited. He was introduced as a
director into VOPL in the year 1998; he later became the Managing
Director in the year 2005 and looks after the day to day affairs
of the company. Mrs. Mallampati Anuradha is a post graduate and
started her career as the director of VPL during the 1980s. She
currently holds the post of the director and assists Mr.
Chakradhar in managing the daily operations of VOPL. Mrs.
Mallampati Lakshmi Kranthi is the wife of Mr. Chakradha, she is an
engineering graduate and one of the directors in VOPL and handles
the human resource development department of the company.
Vani Organics Private Limited (VOPL) belongs to Vani Group based
out of Hyderabad promoted by Late Mr. Subba Rao. The Group
commenced its business by incorporating Vani Pharma Labs Limited
(VPL) in the year 1976 which is the flagship company of the group.
VPL is engaged in the manufacturing of Active Pharmaceutical
Ingredients (APIs) and bulk drugs. In 1984, the group expanded its
production facilities by incorporating VOPL in Bidar, Karnataka,
to process bulk drug orders received from other drug manufacturing
companies. The current promoters of VOPL are Mr. Mallampatti
Chakradhar, Mrs. Mallampati Anuradha and Mrs. Mallampati Lakshmi
Kranthi. VOPL does job work of bulk drug and intermediaries
manufacturing for companies like VPL, Sequent Scientific Limited,
Everest organics etc. The company has plans to venture into direct
sale of products in FY17 instead of job works being undertaken
currently. "1 Phenyl 3 Methyl 5 Pyrazolone" (PMP) is the major
product manufactured by VOPL. The company has entered into
agreement with "Sequent Scientific Limited" (ICRA BBB+/ ICRA A2+)
and "Everest organics" for manufacturing of Clorsulon 123 and
Pantoprazole Intermediates, respectively. The company has also
planned to start production of phenyl hydrazine and phenyl
hydrazine HCL.
VERMA TRACTORS: ICRA Raises Rating on INR7cr Cash Loan to B+
------------------------------------------------------------
ICRA Ratings has revised long-term rating from [ICRA]B to [ICRA]B+
and reaffirmed short-term rating at [ICRA]A4 to the INR7.00 crore
fund-based bank facilities of Verma Tractors (VT). The outlook on
the long-term rating is Stable.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Fund-based Cash 7.0 [ICRA]B+(Stable) Upgraded
Credit from [ICRA]B/A4; reaffirmed
Rationale
The revised rating favorably factors in the revival in demand of
tractors led by better agro-climatic conditions. Consequently, the
firm has been able to post improved coverage indicators and
operating margins in FY2017. The rating continues to draw comfort
from the established presence of the company as an authorized
dealer of Escorts Tractors. ICRA also notes improved margins on
the back of added incentives and discounts passed on by Escorts
Limited. However, rating continues to be susceptible to agro
climatic risk along with risks emanating from partnership
constitution. The rating is also constrained by limited equity of
the partners resulting in higher leverage. The competition from
other established tractors brands continues to be threat to the
overall sales of the company.
Outlook: Stable
ICRA believes that VT will maintain its competitive position in
the region with no other Escorts Tractor dealer in the 9 blocks of
the district of Barabanki, Uttar Pradesh (U.P), where the firm
operates. The firm will continue to benefit from the position of
Escorts tractors and overall positive outlook of the tractor
industry. The outlook may be revised to 'Positive' if the company
is able to scale up operations and capital base and improve its
coverage indicators while maintaining its profitability. The
outlook may be revised to 'Negative' if the withdrawals from the
partner increases and the discounts and incentives by Escorts
Limited are withdrawn.
Key rating drivers
Credit strengths
* Established presence of firm in Barabanki city as authorized
dealer of Escorts Limited: The firm established in 2004 is an
established authorized dealer of Escorts limited and is operating
alone in the 9 out of 17 block in the city of Barabanki, U.P. The
firm is operating with four outlets in the entire city.
* Healthy industry scenario resulting growth revival: The tractor
industry experienced growth in the previous financial year which
is being continued. The growth is due to favourable agro-climatic
conditions prevailing in the country coupled with favourable
government policies. The rising prices of the crops produced in
the vicinity of Barabanki have also contributed in the surge in
demand of the tractors. Subsequently, the operating margins have
bettered as compared to last financial year further resulting in
comfortable coverage indicators. The interest coverage improved to
1.4 times in FY2017 from 0.9 times in FY2016.
Credit challenges
* Thin profitability as predominant in trading nature of business:
The profitability has remained low with operating margin being
around 2-3% over the years. Along with the nature of business, the
agro-climatic risk is constantly a threat.
* Partnership nature of business and low capital base: The risk
inherent to partnership nature of business exists. However, the
amount withdrawn is not major. The capital base of the firm is
also growing gradually and is at moderate level of INR2.05 crore
as on March 31, 2017.
Verma Tractors (VT) established in 2004 is an authorized dealer of
Escorts Tractors in the city of Barabanki, U.P. The firm operates
in the city through its four outlets. The outlets are in Barabanki
city and blocks of Kaiserganj, Fatehpur and Ramnagar. The
operation of the firm is being managed by three partners Mrs Daya
Rani Verma, Mrs Archana Verma and Mr Suresh Chandra Verma.
In FY2017, the firm reported a net profit of INR0.3 crore on an
operating income (OI) of INR31.20 crore compared with a net profit
of INR0.1 crore on an OI of INR23.50 crore in the previous year.
WINDSOR EDIFICE: ICRA Lowers Rating on INR50cr Term Loan to D
-------------------------------------------------------------
ICRA Ratings has downgraded the long-term rating to [ICRA]D from
[ICRA]BB- for the INR50.0-crore term loan facility of Windsor
Edifice Private Limited.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Fund based-Term 50.0 [ICRA]D; Revised from
Loan [ICRA]BB- (Stable)
Rationale
The rating downgrade takes into account the recent delays in
servicing the interest payment obligations by the company on
account of its stretched liquidity position. The slow sales
velocity and weak collection efficiency for the only ongoing
project, Windsor Troika, has resulted in stretched cash flow
position and increased reliance on funding support from promoters.
Key rating drivers
Credit strengths
* Part of Windsor group which has an established track record of
execution and brand recognition is South Bengaluru real estate
market: Incorporated in 2010, Windsor Edifices Private Limited
(WEPL) is part of the Windsor group. The group has a track record
of over fifteen years in the Bengaluru real estate space. The
group has executed seven residential and one commercial project
encompassing about 1.27 million square feet of constructed area.
Credit weaknesses
* Stretched liquidity profile resulting in delays in debt
servicing: The company has delayed in meeting its debt servicing
obligations owing to weak sales velocity in its ongoing project,
Windsor Troika, and its inability to monetize the land asset as
was envisaged at the time of the last rating exercise.
* Exposure to inherent cyclicality in the real-estate industry
coupled with prevailing weak macro-economic scenario: Operating in
a cyclical industry, the company's fortune is highly dependent on
macro-economic factors which make its sales vulnerable to any
downturn in the real-estate demand and the competition within the
region from various established developers.
Windsor Edifices Private Limited (WEPL), is part of the Bangalore
based Windsor Group, which is engaged in the business of real
estate development. The company is held by Windsor Gardens Private
Limited (16.97%), Mr. MSRV Prasad (35.88%), Mr. MJ Patel (35.88%)
and Mrs. M Rajyalakshmi (11.26%). The company was incorporated in
2010 with its registered office at Bangalore and was set up for
the purpose of developing a residential project-Windsor Troika in
Begur Road, Off Bannerghatta Road, Bangalore. The project will
consist of two towers, each comprising G+18 floors with 286
residential units. In addition, another tower comprising G + 5
floors shall be developed which would house car parking, club
house, gymnasium etc. The total cost of construction of the
project has been estimated at INR127.27 crores, which is proposed
to be financed with a mix of term loan facility of INR50.00
crores, core equity component of INR18.61 crores, quasi equity in
the form of unsecured loan amounting to INR13.21 crores and
customer advances of INR45.45 crores.
ZUBIC LIFESCIENCE: CARE Lowers Rating on INR12.80cr Loan to D
-------------------------------------------------------------
CARE Ratings revised the ratings on certain bank facilities of
Zubic Lifescience Private Limited (ZLPL), as:
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long-term Bank 12.80 CARE D Revised from
Facilities CARE B; Stable
Detailed Rationale & Key Rating Drivers
Ongoing delays in Debt servicing: The revision in the rating
assigned to the bank facilities of ZLPL is primarily due to
irregularity in servicing its debt obligations.
Incorporated in the year 2015, ZLPL is implementing green field
project for manufacturing of small volume parenteral at Baroda
(Gujarat). ZLPL is promoted by four promoters led by Mr Paras
Kumar Kacchadiya. ZLPL has undertaken project to manufacture small
volume parenteral with proposed installed capacity of 1,92,000
ampoules per day (2 ml to 10 ml) and 1,92,000 vials per day (30 ml
to 100 ml) at its facilities located at Baroda-Gujarat. The
products manufactured by the company will find application in
local anaesthetics, vaccines and other traditional injectable. The
company will perform sub-contracting work for manufacturing of
injectable for various pharmaceutical companies in Gujarat and the
raw materials costs for it will be borne by the Pharma companies
themselves.
=========
J A P A N
=========
TOSHIBA CORP: China Officials Concerned With Hynix Role in Sale
---------------------------------------------------------------
Bloomberg News, citing people familiar with the matter, reports
that antitrust officials in China's Ministry of Commerce are
concerned about the role SK Hynix Inc. will play in the sale of
Toshiba Corp.'s memory chip business as the country commences a
review of the deal.
Mofcom officials are looking at the fact that Hynix could take a
sizable stake in the business if the sale goes ahead, the people
said, asking to not be identified as they aren't authorized to
speak on the matter, Bloomberg relates. Toshiba may need to offer
some remedies to reassure the regulator that it won't hurt
competition, the people said. The ministry could impose conditions
on a deal, they said, Bloomberg relays.
China is the world's largest market for semiconductors and the
country is spending billions to build up its domestic industry.
Hynix, South Korea's second-biggest maker of memory chips, is part
of a group led by Bain Capital that is buying the business from
Toshiba for JPY2 trillion ($18 billion), Bloomberg notes. The
Icheon-based company is providing financing to the deal through
convertible bonds that could give it as much as 15 percent of the
voting rights in the business, according to Bloomberg.
Bloomberg says Toshiba is selling its chip unit to repair a
balance sheet battered by billions of dollars of losses from its
nuclear energy operations. Bain's group of investors also includes
Apple Inc., Dell Inc. and Japan's Hoya Corp, Bloomberg discloses.
Tokyo-based Toshiba will retain a stake, and with Hoya Corp. will
control a majority of voting stock, a solution that keeps control
of sensitive technology in Japanese hands.
Last week, Toshiba and Western Digital Corp., a current partner in
the chips business, settled a dispute over the sale that had
threatened to derail a deal, Bloomberg recalls. The U.S. company
dropped its arbitration claims after agreeing to invest alongside
Toshiba in two new chip plants in Japan and receive a guaranteed
supply of memory chips, Bloomberg says.
About Toshiba Corp
Toshiba Corporation (TYO:6502) -- http://www.toshiba.co.jp/-- is
a Japan-based manufacturer involved in five business segments.
The Digital Products segment offers cellular phones, hard disc
devices, optical disc devices, liquid crystal televisions, camera
systems, digital versatile disc (DVD) players and recorders,
personal computers (PCs) and business phones, among others. The
Electronic Device segment provides general logic integrated
circuits (ICs), optical semiconductors, power devices, large-
scale integrated (LSI) circuits for image information systems and
liquid crystal displays (LCDs), among others. The Social
Infrastructure segment offers various generators, power
distribution systems, water and sewer systems, transportation
systems and station automation systems, among others. The Home
Appliance segment offers refrigerators, drying machines, washing
machines, cooking utensils, cleaners and lighting equipment. The
Others segment leases and sells real estate.
As reported in the Troubled Company Reporter-Asia Pacific on
Dec. 15, 2017, Moody's Japan K.K. affirmed Toshiba Corporation's
Caa1 corporate family rating and senior unsecured debt ratings,
and its Ca subordinated debt rating. Moody's has also changed the
ratings outlook to stable from negative. At the same time, Moody's
has affirmed Toshiba's commercial paper rating of Not Prime.
On Oct. 6, 2017, S&P Global Ratings affirmed its 'CCC-' long-term
corporate credit and 'C' short-term corporate credit and
commercial paper program ratings on Japan-based capital goods and
diversified electronics company Toshiba Corp. S&P also removed the
ratings from CreditWatch. The outlook is negative. At the same
time, S&P raised the senior unsecured rating one notch to 'CCC-'
from 'CC' following completion of its review of the rating. S&P
also removed the senior unsecured rating from CreditWatch with
negative implications following its affirmation of the long-term
corporate credit rating and resolution of the CreditWatch.
====================
N E W Z E A L A N D
====================
MEDIA INFORMATION: Liquidators Find Buyer for Group's Assets
------------------------------------------------------------
Jonathan Underhill at BusinessDesk reports that the liquidator of
the Main Report, Trans Tasman and associated newsletters said it
has found a buyer for the assets of the group, which failed after
being unable to meet its tax bill.
BusinessDesk relates that the buyer isn't identified in the
liquidator's first report, which says it has "entered into a sale
and purchase agreement for a modest sum." Shareholder and director
Max Bowden had been trying to sell the business over the course of
the last year but hadn't been able to negotiate a successful sale,
Wendy Somerville of PwC said in the report, BusinessDesk relays.
The sale was agreed when the liquidator went back to the same
interested parties.
According to BusinessDesk, Inland Revenue sought the liquidation
of Christchurch-based Media Information, Trans Tasman Media and
The Main Report, which publishes a series of weekly industry-
specific newsletters, including the Trans Tasman political
newsletter, which has been running since 1968, penned in part by
the longest-serving member of the Parliamentary press gallery, Ian
Templeton.
Ms. Somerville said in her report that the companies were also in
arrears on rent and the liquidator had arranged to vacate their
Christchurch premises by Dec. 11, BusinessDesk relates. A senior
staff member on site had helped in the collection of the
companies' books and records. The assets were listed as mastheads,
website domain names, publishing software and subscription
databases
The liquidator report said the companies' financial statements for
the year ended March 31 show "a significantly overdrawn current
account which we are currently investigating," BusinessDesk
relays. The liquidator will also be looking at the books to
determine if there were any insolvent transactions or breaches of
legislation.
It said several staff members were employed on a contract basis
and as a result their claims rank as unsecured claims in the
liquidation, rather than being preferential creditors as
employees, BusinessDesk says.
BusinessDesk relates that the liquidator report showed Inland
Revenue's claim against the Main Report for outstanding GST,
Kiwisaver employee deductions and contributions, PAYE deductions,
student loan employer deductions and superannuation contribution
tax stood at about NZ$43,000. Media Information owed about
NZ$16,500 for GST and income tax and Trans Tasman owed about
NZ$157,000 for outstanding GST, dividend withholding tax, income
tax, Kiwisaver contributions and deductions, PAYE and employee
superannuation.
Along with IRD, other known creditors including IT and printing
firms, NZ Post, UDC Finance, Flexirent Capital, the Canterbury
Chamber of Commerce and various contributors to the newsletters,
BusinessDesk discloses.
Like other industry-specific publishers, the Main Report's
newsletters have operated on a subscription model largely eschewed
by New Zealand's mainstream media outlets, BusinessDesk notes.
=================
S I N G A P O R E
=================
GLOBAL A&T: Fitch Lowers IDRs to 'D' on Chapter 11 Filing
---------------------------------------------------------
Fitch Ratings has downgraded Singapore-based semiconductor
outsourced assembly and testing (OSAT) services company Global A&T
Electronics Ltd's (GATE) Long-Term Foreign- and Local-Currency
Issuer Default Ratings (IDRs) to 'D' (Default) from 'RD'
(Restricted Default).
KEY RATING DRIVERS
Chapter 11 Filing: The downgrades follow the commencement of
voluntary proceedings on Dec. 18, 2017 under Chapter 11 of the
U.S. Bankruptcy Code in the United States Bankruptcy Court for the
Southern District of New York by the company and some of its
subsidiaries.
Under Fitch's rating definitions, 'D' ratings indicate that, in
Fitch's opinion, an issuer has entered into bankruptcy filings,
administration, receivership, liquidation or other formal winding-
up procedure or has otherwise ceased business. The 'D' rating is
appropriate even though the court proceedings are to confirm a
pre-packaged plan of reorganisation that has been agreed with
almost all of GATE's noteholders.
Upgrade on Successful Restructuring: On consummation of the
restructuring, Fitch is likely to upgrade GATE's IDRs to reflect
the lower level of debt in the capital structure - debt will be
USD665 million, rather than USD1.1 billion currently. However,
given the business risks facing smaller OSAT companies, Fitch
expects the new rating to be low in the 'B' category.
DERIVATION SUMMARY
The rating has been downgraded to 'D' as the company has entered
into voluntary proceedings under Chapter 11 of the U.S Bankruptcy
Code.
KEY ASSUMPTIONS
Previously, Fitch's key assumptions within its rating case for the
issuer included:
- Revenue to decline by 4%-5% in 2017.
- Operating EBITDA to decline by 10%-15% (2016: USD154 million).
Fitch will reassess its rating assumptions for the business when
the company has received approval for restructuring.
RATING SENSITIVITIES
Developments that May, Individually or Collectively, Lead to
Positive Rating Action
- When the company emerges from the Chapter 11 process Fitch
expects to upgrade the rating based on the new capital
structure, which will have substantially less debt. However,
given the risks associated with smaller OSAT companies, Fitch
expects the new rating to be low in the 'B' category
Developments that May, Individually or Collectively, Lead to
Negative Rating Action
- The rating cannot be downgraded from 'D', as this is the
lowest rating on the scale.
LIQUIDITY
The company defaulted on its bond interest payment in August 2017
because of critical liquidity and an unsustainable capital
structure. If restructuring is not complete before January 2018,
GATE is reported to have said that it may require debtor-in-
possession funding to continue.
====================
S O U T H K O R E A
====================
CEYLON DOLLAR: Fitch Affirms Then Withdraws B+f Cr. Quality Rating
------------------------------------------------------------------
Fitch Ratings has affirmed Ceylon Dollar Bond Fund's (CDBF)
International Fund Credit Quality Rating at 'B+f' and Fund Market
Risk Sensitivity Rating at 'S5', and simultaneously withdrawn the
rating.
KEY RATING DRIVERS
The affirmation reflects the broad stability of the fund's credit
quality and market risk sensitivity, as reflected in its rating
distribution, weighted-average rating factor and market risk
factor, based on surveillance data provided to the agency covering
the period up to the date of withdrawal.
Fitch is withdrawing the ratings as CDBF has chosen to stop
participating in the rating process. Therefore, Fitch will no
longer have sufficient information to maintain the ratings.
Accordingly, Fitch will no longer provide ratings or analytical
coverage for CDBF.
===============
X X X X X X X X
===============
* Fitch: Sees Stable 2018 Outlook for 356 Asia-Pacific Corporates
-----------------------------------------------------------------
Fitch Ratings forecasts a stable sector outlook in 2018 for its
rated portfolio of 356 Asia-Pacific corporates. Fitch expects
fundamental conditions to improve for most corporates due to
global economic growth, stable commodity prices and modest capex.
Key risks focus on China, where domestic funding costs have risen
sharply and expansion in key sectors is slowing.
Fitch assigned stable sector outlooks to 13 of its 14 sector-
specific 2018 outlook reports across the Asia-Pacific. The only
sector with a negative outlook is Hong Kong retail property, as
Fitch expects retail sales to remain weak in light of lower
spending by Chinese tourists and rising street-shop vacancies.
Fitch forecasts the portfolio's overall net debt/EBITDA leverage
ratio to fall to 2.0x by 2019, from 2.2x in 2017. Overall revenue
growth is likely to remain strong, at 6% in 2019 (2017: 8%), and
capex/CFO should remain well below 100% for most sectors, except
utilities and transportation. Aggregate free cash flow generation
should become positive by 2019, after turning negative in 2017 due
to corporates in emerging Asia. Fitch expects sector leverage to
fall for basic materials, energy, retail, leisure and consumer
products (RLCP) and technology, media and telecommunications
(TMT). Leverage should stay flat for industrials, utilities and
transportation.
Fitch's rating Outlook bias is largely neutral, due to a similar
proportion of Positive Outlooks (8%) and Negative Outlooks (9%).
This is a change from 12 months ago, when the proportion of
Negative Outlooks (9%) was well above Positive Outlooks (3%). Most
of its Negative Outlooks are in China (18) and the majority of
Positive Outlooks are in Indonesia (9) and China (8). By sector,
most Negative Outlooks are for real estate (13), basic materials
(5) and RLCP (5), while most Positive Outlooks are for real estate
(7), utilities and transport (7) and TMT (5).
Fitch's 12-month rolling ratio of downgrades/upgrades remains in
favour of downgrades, at 1.5:1.0, after downgrading 29 and
upgrading 19 corporates during the 12-months ending 3Q17. However,
this ratio has fallen from a peak of 4.3:1.0 in 1Q17, with 3Q17
marking the first time the number of upgrades has exceeded that of
downgrades since 4Q14.
Credit conditions in China have tightened following a significant
rise in the cost of domestic-debt funding during 2017. Fitch
believes the authorities will keep policy options open and
maintain adequate liquidity in key sectors to ensure target
economic growth rates can be met. Nevertheless, corporate defaults
in heavy industries linked to property and infrastructure are
likely to increase in 2018, given signs of negative housing market
growth, slower growth in fixed-asset investment and ongoing
government efforts to cut excess capacity and curb pollution.
Fitch's report is captioned "Fitch 2018 Outlook - Asia-Pacific
Corporates".
*********
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.
Marites O. Claro, Joy A. Agravante, Rousel Elaine T. Fernandez,
Julie Anne L. Toledo, Ivy B. Magdadaro 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
to be reliable, but is not guaranteed.
TCR-AP subscription rate is US$775 for 6 months delivered via e-
mail. Additional e-mail subscriptions for members of the same
firm for the term of the initial subscription or balance
thereof are US$25 each. For subscription information, contact
Peter Chapman at 215-945-7000 or Joseph Cardillo at 856-381-8268.
*** End of Transmission ***