/raid1/www/Hosts/bankrupt/TCRAP_Public/190228.mbx
T R O U B L E D C O M P A N Y R E P O R T E R
A S I A P A C I F I C
Thursday, February 28, 2019, Vol. 22, No. 43
Headlines
A U S T R A L I A
ABOUT LIFE: Second Creditors' Meeting Set for March 8
ACQUIRE LEARNING: Demetriou Grilled Over Role in AUD145M Collapse
ALCEME INTERNATIONAL: First Creditors' Meeting Set for March 8
CAMDEN COMMUNITY: In Administration; March 7 Creditors Meeting Set
DUBBO RAILWAY: Creditors Vote to Place Company Into Liquidation
KASBAH MOROCCAN: First Creditors' Meeting Set for March 8
MACFIELD CONSTRUCTION: First Creditors' Meeting Set for March 8
NEOLIDO HOLDINGS: Liquidator David Leigh's Registration Cancelled
PATRICK BAKER: Clifton Hall Appointed as Liquidator
PEPPER RESIDENTIAL 23: S&P Rates A$8-Mil. Class F Notes 'B'
S.R. & B.R. LEE-ARCHER: First Creditors' Meeting Set for March 12
UNIVERSAL DRONES: Second Creditors' Meeting Set for March 6
VP PLAS: Second Creditors' Meeting Set for March 8
C H I N A
IWJW: House Rental Online Platform Goes Into Liquidation
REDSUN PROPERTIES: Fitch Gives Final B on $300MM Notes Due 2021
RONSHINE CHINA: Fitch Give Final B+ on $300MM Senior Notes Due 2022
H O N G K O N G
ESPRIT HOLDINGS: First Half Loss Widens on Brand Weakness
I N D I A
ACCURATE INFRA: CRISIL Moves D on INR11cr Loans to Not Cooperating
AL KARMA: CRISIL Maintains D Ratings in Not Cooperating Category
AMARAVATHI SPINNING: CRISIL Maintains D Ratings in Not Cooperating
BALESHWAR KHARAGPUR: Ind-Ra Cuts INR3,936BB Bank Loan Rating to C
BARWA ADDA: Ind-Ra Lowers Rating on INR14BB Term Loan to C
BASUDHA UDYOG: CRISIL Maintains D Ratings in Not Cooperating
BHARAT SCANS: CRISIL Maintains D Ratings in Not Cooperating
CAPITAL CABLES: Ind-Ra Maintains BB- LT Rating in Non-Cooperating
CRIYAGEN AGRI: CRISIL Migrates B Rating to Not Cooperating
D K CERAMIC: CRISIL Maintains 'D' Ratings in Not Cooperating
DEMBLA TIMBER: Ind-Ra Moves B+ on INR30MM Debt to Non-Cooperating
DHANVRIDHI COMMERCIAL: CRISIL Keeps D Ratings in Not Cooperating
DHANYA STEEL: CRISIL Moves D on INT13cr Credit to Not Cooperating
DYNAMIC ELECTRICALS: CRISIL Keeps INR2cr Debt in Non Cooperating
FATEH CHAND: Ind-Ra Hikes Bank Term Loan Ratings to 'BB+'
FINECRETE ECO-BLOCKS: CRISIL Keeps D Rating on Non-Cooperating
GRANDWAY INC: Ind-Ra Migrates B+ Issuer Rating to Non-Cooperating
JAI GURUDEV: CRISIL Lowers Ratings on INR8.21cr Loans to B
JSW STEEL: Fitch Affirms 'BB' LT IDR & Sr. Unsecured Rating
KARYAVATTOM SPORTS: Ind-Ra Cuts Rating on Sr. Project Loans to C
KVR INDUSTRIES: CRISIL Maintains D Ratings in Not Cooperating
NATVAR COTEX: CRISIL Assigns B+ Ratings to INR7.54cr LT Loan
NIKHIL FOOTWEARS: CRISIL Maintains D Ratings in Not Cooperating
PEARL INTERNATIONAL: Ind-Ra Migrates BB Ratings to Non-Cooperating
SANMARG PROJECTS: Ind-Ra Withdraws BB- on 3 Debt Tranches
SFPL CROP: CRISIL Lowers Rating on INR7.5cr Cash Loan to D
SHRI BALAJI: CRISIL Withdraws B- Rating from Not Cooperating
SHRI KALKA: CRISIL Reaffirms B+ Ratings on INR9.75cr Loans
SIKAR BIKANER: Ind-Ra Cuts INR4BB Senior Project Loan Rating to 'C'
STAR AGRO: CRISIL Maintains D Ratings in Not Cooperating Category
SURAJ UDYOG: Ind-Ra Maintains BB- Issuer Rating in Non-Cooperating
THANGAMMAN TEXTILES: CRISIL Moves D Rating to Not Cooperating
VEESONS ENERGY: CRISIL Maintains 'D' Ratings in Not Cooperating
VELAVEN POLYMERS: Ind-Ra Affirms 'D' Long Term Issuer Rating
VIMAX CROP: CRISIL Lowers Ratings on INR15cr Loans to B-
VINAY POULTRY: CRISIL Assigns D Rating to INR8cr LT Loan
J A P A N
UNITIKA LIMITED: Egan-Jones Lowers Commercial Paper Ratings to B
N E W Z E A L A N D
MAINZEAL PROPERTY: Contractors Fear Owed Millions Won't Be Repaid
S I N G A P O R E
HYFLUX LTD: Clash Over $2 Billion Debt Heats Up
NAM CHEONG: Swings to MYR6.3MM Q4 Profit After Waiver of Debts
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A U S T R A L I A
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ABOUT LIFE: Second Creditors' Meeting Set for March 8
-----------------------------------------------------
A second meeting of creditors in the proceedings of About Life Pty
Ltd has been set for March 8, 2019, at 2:00 p.m. at Room Pinaroo 5,
Level 1 The Grace Hotel, 77 York Street, in Sydney, NSW.
The purpose of the meeting is (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 March 6, 2019, at 5:30 p.m.
Adam Edward Farnsworth of Farnsworth Shepard was appointed as
administrator of About Life on Dec. 17, 2018.
ACQUIRE LEARNING: Demetriou Grilled Over Role in AUD145M Collapse
-----------------------------------------------------------------
Henrietta Cook at The Sydney Morning Herald reports that former AFL
boss Andrew Demetriou was repeatedly warned about the poor
financial health of training group Acquire Learning before the
company collapsed with a AUD145 million debt.
On Feb. 27, the Crown Resorts director was grilled in the Supreme
Court about his involvement in the company as part of a
liquidator's inquiry into why Acquire collapsed in May 2017 after
receiving tens of millions of dollars in federal government
subsidies, SMH relates.
According to the report, Mr. Demetriou was paid AUD900,000 a year
for his three-day-a-week job as executive chairman of the company's
"advisory group".
Acquire Loan also loaned the former AFL chief AUD1.68 million to
buy shares in the company, the report says.
Acquire Learning was a vocational education broker that sold
courses on behalf of other private colleges. It purchased job
seekers' details from job search websites and then cold-called them
to sell expensive courses with the lure of a future job.
In June 2016, a week before the company received legal advice
stating it was on the brink of trading while insolvent, Mr.
Demetriou requested and received a AUD150,000 bonus, SMH recalls.
He told counsel for the liquidator, Damien McAloon that he could
not remember what the bonus was for, SMH relates.
He also said he was unaware of the legal advice, despite the
company's lawyer explicitly asking a director to share the news.
SMH says Mr. Demetriou was repeatedly questioned about his claim
that he acted only as the executive chairman of the company's
advisory group.
He repeatedly sought to distance himself from any financial
decisions involving the company telling the court that he was not
involved in operational matters.
"My role was to primarily open doors, to use my network of
contacts, to give advice to the board members," SMH quotes Mr.
Demetriou as saying.
But emails tendered in court showed that Mr. Demetriou referred to
himself as the company's executive chairman in his email signature,
with no mention of the advisory group.
He also signed off on a director's bonus and oversaw pay increases
for some company directors, including his nephew Tim Demetriou
whose annual salary increased to AUD500,000 in early 2016.
At one stage, Tim Demetriou emailed his "uncle Andy" and asked:
"how much are we worth?".
Mr. Demetriou responded: "AUD1.2 billion to AUD1.5 billion on a
good day," adds SMH.
But the company's fortunes went downhill after the federal
government cracked down on the scandal-plagued vocational education
sector, according to SMH.
Emails tendered in court showed that Mr. Demetriou received
numerous emails detailing the company's dwindling fortunes.
"We are running at 50 per cent of the enrolments we need, which is
extremely risky," one email read.
SMH notes that the government crackdown disrupted the business
model of vocational education companies such as Acquire Learning,
making it more difficult for them to sign up students to government
loans, with third-party brokers and inducements such as free
laptops banned.
According to SMH, Acquire received funding from the federal
government in advance based on forecast enrolments. But from 2016,
as student numbers dropped significantly lower than what was
forecast, Acquire was left with a AUD43 million debt to the federal
government.
In late 2015, the Australian Competition and Consumer Commission
began prosecuting Acquire for false, misleading and unconscionable
conduct. It slapped the company with a AUD4.5 million fine for
aggressively selling courses to vulnerable students, including the
unemployed, who had little hope of completing their qualifications,
SMH discloses.
The failed company owes money to the Australian Taxation Office,
former employees and News Limited, SMH relays.
Mr. Demetriou was also the chairman of online job search site
CareerOne, a company that was primarily owned by Acquire Learning,
says SMH.
ALCEME INTERNATIONAL: First Creditors' Meeting Set for March 8
--------------------------------------------------------------
A first meeting of the creditors in the proceedings of Alceme
International Pty Ltd will be held on March 8, 2019, at 11:00 a.m.
at Level 2, 15 Victoria Street, in Hobart, Tasmania.
Shelley Brooks of Rodgers Reidy was appointed as administrator of
Alceme International on Feb. 26, 2019.
CAMDEN COMMUNITY: In Administration; March 7 Creditors Meeting Set
------------------------------------------------------------------
Timothy Clifton and Simon Miller of Clifton Hall were appointed as
Joint and Several Administrators of Camden Community Centre
Incorporated on Feb. 25, 2019.
The first meeting of creditors will be held on March 7, 2019 at
11:00 am at the offices of Clifton Hall, at Level 3, 431 King
William Street, in Adelaide, South Australia.
DUBBO RAILWAY: Creditors Vote to Place Company Into Liquidation
---------------------------------------------------------------
Faye Wheeler at Daily Liberal reports that creditors have voted to
place Dubbo Railway Bowling Club, trading as Sporties Dubbo, into
liquidation, the administrators said.
The decision was made at a meeting of creditors held at Dubbo on
Feb. 27, the report says.
Sporties Dubbo ceased to trade on Feb. 23.
In November, the administrators reported the club had fallen into
"financial distress as a result of unfavourable contracts and
operational challenges," the report recalls.
Sporties Dubbo was established more than 60 years ago in 1954 to
cater for NSW railway employees domiciled at Dubbo. Aaron Lucan and
Graeme Beattie of Worrells Solvency were appointed as
administrators of Dubbo Railway on Nov. 15, 2018.
KASBAH MOROCCAN: First Creditors' Meeting Set for March 8
---------------------------------------------------------
A first meeting of the creditors in the proceedings of Kasbah
Moroccan Imports (Vic) Pty Ltd will be held on March 8, 2019, at
11:00 a.m. at the offices of Romanis Cant, 2nd Floor, 106 Hardware
Street, in Melbourne, Victoria.
Anthony Robert Cant and Renee Sarah Di Carlo of Romanis Cant
were appointed as administrators of Kasbah Moroccan on Feb. 26,
2019.
MACFIELD CONSTRUCTION: First Creditors' Meeting Set for March 8
---------------------------------------------------------------
A first meeting of the creditors in the proceedings of Macfield
Construction Pty Ltd will be held on March 8, 2019, at 10:30 a.m.
at the offices of KPMG, Level 8, 235 St Georges Terrace, in Perth,
Western Australia.
Clint Peter Joseph and Hayden Leigh White of KPMG were appointed as
administrators of Macfield Construction on Feb. 26, 2019.
NEOLIDO HOLDINGS: Liquidator David Leigh's Registration Cancelled
-----------------------------------------------------------------
The registration of David John Leigh as a liquidator has been
cancelled following a decision by a disciplinary committee,
according to the Australian Securities and Investments Commission.
The Committee decided that Mr. Leigh had acted dishonestly in
arranging the transfers of AUD800,000 from a liquidation bank
account into a bank account that he controlled, and that he was not
a fit and proper person to be registered as a liquidator.
Furthermore, the Committee concluded that the regulatory purpose of
cancellation would not be achieved if Mr. Leigh could still work in
the insolvency industry under a registered liquidator. It also
decided that a condition should be imposed on all other registered
liquidators that they must not allow Mr. Leigh to carry out any of
the functions or duties, or exercise any of the powers, of a
registered liquidator on their behalf for eight years commencing on
Feb. 22, 2019.
ASIC Commissioner John Price said, 'It is important that the
community has confidence in the professionalism and conduct of the
corporate insolvency system. Registered liquidators are in a
position of trust and must act honestly in the protection and
administration of 'other people's money'. ASIC will ensure those
who fail to meet these responsibilities are held to account'.
The Committee was convened on Jan. 2, 2019, after Mr. Leigh, the
former liquidator of Neolido Holdings Pty Ltd (in Liquidation)
[Neolido], did not respond to the 'show cause notice' sent to him
by ASIC on Nov. 13, 2018 asking him to give a written explanation
why his liquidator registration should continue.
Neolido was a property development company based in South Brisbane
that was wound up on Nov. 25, 2005 following an ASIC application to
the Federal Court. On Oct. 14, 2010, Mr. Leigh, who was then a
partner of PPB Advisory, was appointed as a co-liquidator of the
company.
On March 2, 2018, ASIC suspended Mr. Leigh's registration as a
company liquidator following receipt of an application by him which
was formally lodged on Feb. 28, 2018. Mr. Leigh agreed to resign as
external administrator of all his current appointments and ASIC
exercised its powers to appoint replacement liquidators to 16
companies to which Mr. Leigh had been appointed as sole liquidator.
On March 20, 2018, Mr. Andrew Fielding and Ms Helen Newman of BDO
Business Restructuring were appointed as co-liquidators of Neolido.
Mr. Leigh's registration as liquidator was suspended pending an
ASIC investigation into allegations that, as the co-liquidator of
Neolido, he dishonestly redirected AUD800,000 from the Neolido
external administration account into a bank account that he
controlled and used those funds for his own purpose.
Mr. Leigh will appear before the Brisbane District Court on May 3,
2019 for a sentencing hearing in relation to three counts of fraud
under section 408C(1)(D) of the Criminal Code 1899 (Qld) following
him entering a plea of guilty to those offences.
PATRICK BAKER: Clifton Hall Appointed as Liquidator
---------------------------------------------------
Simon Miller of Clifton Hall was appointed liquidator of Patrick
Baker & Associates Pty Ltd (formerly trading as Baker Marketing) on
Feb. 22, 2019.
PEPPER RESIDENTIAL 23: S&P Rates A$8-Mil. Class F Notes 'B'
-----------------------------------------------------------
S&P Global Ratings assigned its ratings to nine classes of
nonconforming and prime residential mortgage-backed securities
(RMBS) issued by Permanent Custodians Ltd. as trustee of Pepper
Residential Securities Trust No. 23. Pepper Residential Securities
Trust No. 23 is a securitization of nonconforming and prime
residential mortgages originated by Pepper HomeLoans Pty Ltd.
The ratings reflect:
-- S&P's view of the credit risk of the underlying collateral
portfolio, including S&P's view that the credit support is
sufficient to withstand the stresses S&P applies. The credit
support for the rated notes comprises note subordination.
Subordination provided to the 'AAA (sf)' rated notes is in excess
in S&P's opinion of the minimum 'AAA (sf)' level of credit
support.
-- The underwriting standard and centralized approval process of
the seller, Pepper Homeloans.
-- The availability of a retention amount, amortization amount,
and yield reserve, which will all be funded by excess spread, but
at various stages of the transaction's term. They will have
separate functions and timeframes, including reducing the balance
of senior notes, reducing the balance of the most subordinated
notes, and paying senior expenses and interest shortfalls on the
class A notes.
-- S&P's expectation that the various mechanisms to support
liquidity within the transaction, including a liquidity facility
equal to 2.5% of the outstanding balance of the notes, and
principal draws, are sufficient under its stress assumptions to
ensure timely payment of interest.
-- The condition that a minimum margin will be maintained on the
assets.
-- The benefit of a cross-currency swap to hedge the mismatch
between the Australian dollar receipts from the underlying assets
and the U.S. dollar payments on the class A1-u notes and the euro
dollar payments on the class A1-GEUR notes.
RATINGS ASSIGNED
Pepper Residential Securities Trust No.23
Class Rating Amount (mil.)
A1-u AAA (sf) US$190.00
A1-a AAA (sf) A$100.00
A1-GEUR AAA (sf) EUR100.00
A2 AAA (sf) A$109.00
B AA (sf) A$52.00
C A (sf) A$22.00
D BBB (sf) A$16.00
E BB (sf) A$9.00
F B (sf) A$8.00
G NR A$9.00
NR--Not rated.
The exchange rate applicable to the class A1-u notes is
US$0.7116104869 per Australian dollar. The exchange rate applicable
to the class A1-GEUR notes is EUR0.633 per Australian dollar. The
class A1-a and class A1-GEUR note sizes are to be determined. Based
on the launch pool the total combined size of these tranches will
be A$425 million.
S.R. & B.R. LEE-ARCHER: First Creditors' Meeting Set for March 12
-----------------------------------------------------------------
A first meeting of the creditors in the proceedings of S.R. & B.R.
Lee-Archer Pty Ltd ATF Lee-Archer Trading Trust will be held on
March 12, 2019, at 9:30 a.m. at the offices of Romanis Cant, 2nd
Floor, 106 Hardware Street, in Melbourne, Victoria.
Anthony Robert Cant and Renee Sarah Di Carlo of Romanis Cant were
appointed as administrators of S.R. & B.R. Lee-Archer on Feb. 27,
2019.
UNIVERSAL DRONES: Second Creditors' Meeting Set for March 6
-----------------------------------------------------------
A second meeting of creditors in the proceedings of Universal
Drones Pty Ltd has been set for March 6, 2019, at 2:00 p.m. at the
offices of SV Partners, at 22 Market Street, in Brisbane,
Queensland.
The purpose of the meeting is (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 March 5, 2019, at 4:00 p.m.
Anne Meagher of SV Partners was appointed as administrator of
Universal Drones on Jan. 30, 2019.
VP PLAS: Second Creditors' Meeting Set for March 8
--------------------------------------------------
A second meeting of creditors in the proceedings of VP Plas Pty
Ltd, formerly trading as Saffe Plas, has been set for March 8,
2019, at 10:00 a.m. at Seminar Room, Central Park Business Centre,
152-158 St Georges Terrace, in Perth, West Australia.
The purpose of the meeting is (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 March 7, 2019, at 4:00 p.m.
Daniel Hillston Woodhouse and Ian Charles Francis of FTI Consulting
were appointed as administrators of VP Plas on Jan. 31, 2018.
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C H I N A
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IWJW: House Rental Online Platform Goes Into Liquidation
--------------------------------------------------------
Deal Street Asia, citing China Money Network, reports that Ai Wu Ji
Wu (Iwjw), a Chinese startup that operates an online platform for
house rental services, has reportedly gone into liquidation after
raising a total of US$305 million in funding since its inception in
2014.
If the report is confirmed, that would mean big-ticket investors
GGV Capital, Temasek Holdings, Hillhouse Capital, and Morningside
Group stand to lose millions of dollars of investments in the
Shanghai-based self-proclaimed unicorn, the report says.
According to Deal Street Asia, Temasek Holdings and Hillhouse
Capital-led Iwjw's $150-million Series E round in November 2015
while GGV Capital and Morningside anchored the $120-million Series
D in May of the same year. GGV also led the $35-million Series C in
Ijwj in 2014.
Shunwei Capital, Banyan Capital, and Gaorong Capital have also
invested in the company, Deal Street Asia discloses citing publicly
available data.
Iwjw's website has already been replaced by information about a new
apartment rental, the report says. The startup's app also appears
to display an error message when opened. A report by Chinese media
outlet Yi Magazine also said Iwji's official registered office does
not exist, the report relays.
Deal Street Asia notes that the company, founded in 2014, was set
up to disrupt the traditional real estate agency business by
offering a platform that allows online processing of home-buying
and renting. It charges a 0.5 per cent commission fee from both
buyers and sellers on home sales.
GGV Capital, Temasek, Hillhouse, and other investors bought into
the vision and poured money into the company. In just 18 months,
Iwjw reached unicorn status from just five rounds of financing, the
report states.
In 2018, however, the company started to feel the heat of a cooling
real estate market and increasing macroeconomic uncertainties, the
report recalls. Interviewed by Chinese media outlet Jiemian in
November, Iwjw co-founder Deng Wei revealed that how to keep the
company afloat was his main priority.
REDSUN PROPERTIES: Fitch Gives Final B on $300MM Notes Due 2021
---------------------------------------------------------------
Fitch Ratings has assigned China-based Redsun Properties Group
Limited's (B/Positive) USD300 million 11.5% senior notes due 2021 a
final rating of 'B' and Recovery Rating of 'RR4'.
The notes are rated at the same level as Redsun's senior unsecured
debt as they constitute its direct and senior unsecured
obligations. Redsun intends to use the proceeds to refinance
existing debt and for general corporate purposes. The assignment of
the final rating follows the receipt of documents conforming to
information already received and is in line with the expected
rating assigned on February 25, 2019.
Redsun is a subsidiary of Hong Yang Group Company Limited
(B/Positive). Fitch rates Redsun using a consolidated approach
based on its Parent and Subsidiary Rating Linkage criteria due to
the strong legal and operational linkages between Redsun and Hong
Yang.
The group's ratings are supported by a high-quality land bank,
which focuses on the city of Nanjing, the capital of China's
Jiangsu province, and the Yangtze River Delta. This helps drive the
group's contracted sales growth and better gross profit margin than
those of 'B' rated peers. The group also has higher recurring
income arising from the large scale of its property-rental
business. The group's improving business profile may be constrained
by the pressure to build up its land bank to pursue sustained high
sales growth. Home-purchase restrictions that affect cities within
Jiangsu province also create uncertainty for the group's contracted
sales growth, although selling prices are likely to be supported by
firm demand.
The Positive Outlook reflects Fitch's expectation that the group
will keep to a prudent financial policy for acquiring land and that
the IPO of Redsun in July 2018 will allow group leverage to be
maintained below 50% in the next year or two.
KEY RATING DRIVERS
Sales to Continue Rising: Fitch expects the group's land
acquisitions and geographical expansion to drive higher sales and
forecasts annual attributable contracted sales to reach CNY30
billion-37 billion in 2019-2020, after increasing by 52% to CNY25
billion in 2018. The group has diversified its land bank to the
cities of Xuzhou, Bozhou, Yangzhou, Taixing and Jurong in Jiangsu
province, Ma'anshan in Anhui province, Huzhou in Zhejiang province
as well as Wuhan in central China and Chongqing in western China.
Niche Property-Rental Business: The group's investment-property
portfolio, which mainly comprises malls for retail and the
wholesale of household construction and decoration materials,
enjoys a niche market position and nearly full occupancy. The
portfolio provides a recurring EBITDA/interest coverage ratio of
0.3x-0.4x, higher than that of 'B' rated peers. Fitch expects the
completion of renovations at the Nanjing Hong Yang Plaza retail
mall in 2017 and still-resilient consumer demand for furniture and
decorations to continue supporting Hong Yang's rental revenue
growth and ratings.
Margins to Stay Healthy: Fitch expects a group EBITDA margin of
25%-26% in 2018-2019 as the high-margin Nanjing projects will
provide support over the next 18-24 months. This will be partly
offset by revenue recognition from more projects outside Nanjing,
which will have lower margins from 2018, possibly higher operating
costs on the group's geographical expansion and pre-listing
expenses for Redsun. The group's EBITDA margin rose to 37% in 2017,
from 31% in 2016, following the delivery of certain Nanjing
projects acquired at low cost in the early 2000s, with gross profit
margins as high as 40%-70%.
Land Acquisitions Remain Controlled: The group spent CNY12 billion
on land-bank replenishment in 2018, equivalent to 0.5x of
contracted sales value (2017: 0.9x, 2016: 0.8x). Group leverage,
measured by net debt/adjusted inventory that proportionately
consolidates joint ventures and associates, was about 40% at
end-June 2018 (2017: 44%, 2016: 40%). The group had attributable
land bank of about 7.2 million square metres at end-June 2018,
sufficient for three to four years of development. Fitch expects
the larger land bank will allow the company to control its
acquisitions and keep its ratio of land acquisitions/contracted
sales at 0.8x in the next two to three years and group leverage
below 50% in the next year or two.
DERIVATION SUMMARY
Redsun's ratings are based on the consolidated profile of its
parent, Hong Yang, due to the strong legal and operational linkages
between the two entities. The group's business profile is similar
to that of 'B' category peers. Ronshine China Holdings Limited
(B+/Stable) and Zhenro Properties Group Limited (B/Positive) are
Hong Yang's closest peers, as both companies focus on first- and
second-tier cities in the Yangtze River Delta region. Hong Yang has
a smaller contracted sales scale and land bank than Ronshine and
Zhenro, while its leverage, defined by net debt/adjusted inventory,
is higher than that of Ronshine but comparable with that of Zhenro.
The group's significant investment-property base is a credit
strength compared with other 'B' category homebuilders. Its
investment property recurring EBITDA/gross interest of around
0.3x-0.4x is comparable with that of Yida China Holdings Limited
(B/Stable), a business-park developer that generated significantly
lower attributable contracted sales of CNY5.6 billion in 2017.
KEY ASSUMPTIONS
Fitch's Key Assumptions Within Its Rating Case for the Issuer
- Attributable property contracted sales of CNY30 billion-37
billion in 2019-2020 (2018: CNY25 billion)
- EBITDA margin, excluding capitalised interest from cost of
goods sold, of 25%-26% in 2018-2019 (2017: 37%)
- An average of 80% of contracted sales proceeds to be spent on
land acquisition in next two to three years to maintain a land bank
sufficient for three to four years of development (2017: 85% of
contracted sales)
RATING SENSITIVITIES
Developments that May, Individually or Collectively, Lead to
Positive Rating Action
- EBITDA margin, excluding capitalised interest from cost of
goods sold, sustained at 20% or above
- Leverage, measured by net debt/adjusted inventory that
proportionately consolidates joint ventures and associates,
sustained below 50%
(All the ratios are based on Hong Yang's consolidated financial
data)
Developments that May, Individually or Collectively, Lead to
Negative Rating Action
- Failure to sustain healthy attributable sales growth and
maintain the positive rating sensitivities over the next 12-18
months will lead to the Positive Outlook reverting to Stable
LIQUIDITY
Sufficient Liquidity: The group had a cash balance of CNY5.6
billion, including restricted cash and pledged deposits of CNY3.0
billion, and unused bank facilities of CNY5.0 billion as at
end-June 2018, sufficient to cover short-term borrowings of CNY9.0
billion.
RONSHINE CHINA: Fitch Give Final B+ on $300MM Senior Notes Due 2022
-------------------------------------------------------------------
Fitch Ratings has assigned Ronshine China Holdings Limited's
(B+/Stable) USD300 million 10.5% senior notes due 2022 a final
rating of 'B+' with a Recovery Rating of 'RR4'. The notes are rated
at the same level as Ronshine's senior unsecured rating because
they are unconditionally and irrevocably guaranteed by the company.
Ronshine intends to use the net proceeds to refinance its debt. The
final rating is in line with the expected rating assigned on
February 24, 2019.
Ronshine's ratings reflect its high quality and diversified land
bank, which supported its fast contracted sales expansion in 2017
and 1H18. Its ratings are constrained by its sustained moderately
high leverage of just above 50%, as defined by net debt/adjusted
inventory. Fitch believes Ronshine will need to replenish its land
bank continuously at market prices to sustain its scale, which may
limit its ability to deleverage to below 45%, the level that will
trigger positive rating action.
KEY RATING DRIVERS
Faster Scale Expansion: Ronshine's total contracted sales increased
by 143% yoy to CNY122 billion in 2018. Proactive land acquisitions
in 2016 and 2017 have provided the company with CNY180 billion in
total saleable resources to achieve its total contracted sales
target of CNY120 billion (equivalent to Fitch's estimated
consolidated contracted sales of CNY84 billion in 2018). Ronshine's
focus on the Yangtze River Delta with exposure to cities that are
benefitting from spillover demand from top-tier cities was a key
driver for the company's strong sales growth.
High Quality, Diversified Land Bank: Ronshine's attributable land
bank increased slightly to 13.0 million square metres (sq m) as of
end-June 2018, from 12.7 million sq m as of end-December 2017. Its
land-bank portfolio is well-diversified, covering 38 cities in
China with a focus on tier 1 and 2 cities, which accounted for 58%
of its land bank by area. Fitch believes Ronshine's diversified
land bank has mitigated the impact from tighter home-purchase
restrictions in many high-tier cities. The company entered new
cities in 2017, including Chengdu, Tianjin, Guangzhou, Chongqing,
Ningbo and Zhengzhou, as well as lower-tiered Longyan, Putian,
Jinhua, Shaoxing and Quzhou. Ronshine also entered the Qingdao
market in 2018.
Margin Recovery: Ronshine's EBITDA margin, after adding back
capitalised interest in cost of goods sold (COGS), recovered to 29%
in 1H18, from 20% in 2017. The weak EBITDA in 2017 was due to the
revaluation of inventory to fair value following some acquisitions
during the year. Fitch expects the impact to diminish as the
company's scale expands. Ronshine's average land-bank cost was
CNY6,463 per sq m, which accounted for 30% of its contracted
average selling price in 1H18. Ronshine's land cost appears
reasonable in light of its high-quality land bank, which should
sustain its EBITDA margin at around 25%-30%.
Ratings Constrained Despite Lower Leverage: Ronshine's leverage,
measured by net debt/adjusted inventory including guaranteed debt
for its joint ventures (JVs) and associates, fell to 53.4% in 1H18,
from 56.6% at end-2017. Management expects to deleverage further as
the company's budget for land acquisition was lowered to about 30%
of contracted sales proceeds in 2018, from about 70% in 2017; the
company plans to keep the proportion at 30%-50% through to 2020 to
maintain its contracted sales scale. However, Ronshine's leverage
is likely to stay at about 50%, which is high among 'B+' rated
peers.
DERIVATION SUMMARY
Ronshine's consolidated contracted sales scale of about CNY80
billion per year and diversified land bank in China are equivalent
to 'BB-' rated homebuilders, such as Yuzhou Properties Company
Limited (BB-/Stable). However, Ronshine's leverage of 50%-55% is
much higher than such peers, which usually have leverage of below
45%.
Ronshine is well-positioned on scale and land-bank quality relative
to Guangdong Helenbergh Real Estate Group Co., Ltd. (B+/Stable),
but its leverage was higher than Helenbergh's 43% at end-2017. The
company has a similar scale to 'B' category peers, such as Yango
Group Co., Ltd. (B/Positive) and Zhenro Properties Group Limited
(B/Positive), although Ronshine's leverage is lower. Ronshine's
normalised EBITDA margin (adding back capitalised interest in COGS)
of about 20%-25% is comparable with that of Zhenro and Yango.
KEY ASSUMPTIONS
Fitch's Key Assumptions Within Its Rating Case for the Issuer
- Total contracted sales of CNY122 billion in 2018 and CNY157
billion in 2019 (2018: CNY122 billion)
- EBITDA margin, after adding back capitalised interest in COGS,
of 25%-30% in 2018-2020 (1H18: 29%)
- Land acquisitions to account for 30% and 55% of contracted
sales proceeds in 2018 and 2019, respectively
Recovery Rating assumptions:
- Ronshine would be liquidated in a bankruptcy because it is an
asset-trading company.
- 10% administrative claims.
- The value of inventory and other assets can be realised in a
reorganisation and distributed to creditors.
- A haircut of 25% on net inventory at fair value, as Ronshine's
EBITDA margin is higher than the industry average. This implies its
inventory will have a higher liquidation value than that of peers.
- A 30% haircut on receivables, 40% haircut on investment
properties and 50% haircut on properties, plant and equipment.
- Ronshine's large cash balance is adjusted so that cash in
excess of its three-month contracted sales is invested in new
inventories.
- Based on its calculation of the adjusted liquidation value
after administrative claims, Fitch estimates the recovery rate of
the offshore senior unsecured debt to be 59%. Fitch has rated the
senior unsecured debt at 'B+'/RR4. Under our Country-Specific
Treatment of Recovery Ratings Criteria, China falls into Group D of
creditor friendliness and instrument ratings of issuers with assets
in this group are subject to a soft cap at the issuer's IDR.
RATING SENSITIVITIES
Developments that May, Individually or Collectively, Lead to
Positive Rating Action
- Leverage, measured by net debt/adjusted inventory including
guaranteed debt for its JVs/associates, sustained below 45% (1H18:
53%)
- EBITDA margin, after adding back capitalised interest in COGS,
sustained at 25% or above (1H18: 29%)
Developments that May, Individually or Collectively, Lead to
Negative Rating Action
- Leverage, measured by net debt/adjusted inventory including
guaranteed debt for JVs/associates, above 55% for a sustained
period
- EBITDA margin, after adding back capitalised interest in COGS,
below 20% for a sustained period
LIQUIDITY
Sufficient Liquidity: Ronshine had a cash balance of CNY20.3
billion at end-June 2018. It issued a total of USD375 million 8.25%
senior unsecured notes due 2021 in July and August 2018. The
company should have sufficient liquidity to refinance its
short-term debt of CNY21 billion.
=================
H O N G K O N G
=================
ESPRIT HOLDINGS: First Half Loss Widens on Brand Weakness
---------------------------------------------------------
Reuters reports that Esprit Holdings Ltd on Feb. 25 posted a bigger
loss for the first half amid changes in consumer behaviour, price
competition and reduced customer traffic across its distribution
channels due to weakness of its brand.
According to Reuters, the Europe-focused clothing retailer reported
a net loss of HK$1.77 billion (US$225.5 million) for the six months
ended December, including a HK$924 million loss on provision for
store closures and leases. That compared with a net loss of HK$954
million in the year-ago period.
Revenue slid to HK$6.77 billion from HK$8.04 billion, Reuters
discloses.
Reuters relates that Esprit said in November that it would cut
about 40 percent of its non-store jobs and reduce the number of
products it sells in stores as it restructures in the wake of tough
competition from online and fast-fashion retailers.
To deal with the challenging environment, the apparel group said it
would shut loss-making stores, restructure cost base and improve
products offering, while time would be needed to draw customers
back into its stores, Reuters relates.
"Looking ahead, the group expects the next two financial years to
be a period of transition," Esprit said in a filing to the Hong
Kong bourse, adding underlying operating profit was expected to
achieve breakeven in two to three years' time, Reuters relays.
Reuters says the group expects its revenue to further decline in
the next two financial years due to closure of loss-making stores.
Shares of Esprit have risen 30.8 percent so far this year after a
62.74 percent plunge in 2018. That compared with an 11.3 percent
gain in the benchmark index so far in 2019, Reuters notes.
Headquartered in Kowloon, Hong Kong, Esprit Holdings Limited,
through its subsidiaries, designs, licenses, sources, wholesales,
and retails high quality life-style products under the ESPRIT brand
name in Europe, Asia Pacific and North America. The Company also
sells Red Earth cosmetics, skin, and body care products and
operates Salon Esprit in Asia Pacific.
=========
I N D I A
=========
ACCURATE INFRA: CRISIL Moves D on INR11cr Loans to Not Cooperating
------------------------------------------------------------------
CRISIL said the ratings on bank facilities of Accurate Infra
Industries Private Limited (AIIPL) continues to be 'CRISIL D Issuer
not cooperating'.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Cash Credit 3 CRISIL D (ISSUER NOT COOPERATING)
Term Loan 8 CRISIL D (ISSUER NOT COOPERATING)
CRISIL has been consistently following up with AIIPL for obtaining
information through letters and emails dated July 31, 2018 and
January 15, 2019 among others, apart from telephonic communication.
However, the issuer has remained non cooperative.
'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 AIIPL, which restricts CRISIL's
ability to take a forward looking view on the entity's credit
quality. CRISIL believes information available on AIIPL 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 ratings on bank
facilities of AIIPL continues to be 'CRISIL D Issuer not
cooperating'.
Furthermore, the company has not paid the fee for conducting rating
surveillance as agreed to in the rating agreement.
Incorporated in 2012, Accurate Infra Industries Private Limited
(AIIPL) is promoted by Mr. Jagdish Poriya. The company manufactures
Autoclave Aerated Conctrete Blocks (AAC) which are used in building
construction.
AL KARMA: CRISIL Maintains D Ratings in Not Cooperating Category
----------------------------------------------------------------
CRISIL said the ratings on bank facilities of Al Karma (Al Karma)
continues to be 'CRISIL D/CRISIL D Issuer not cooperating'.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Bank Guarantee 3.75 CRISIL D (ISSUER NOT COOPERATING)
Cash Credit 3.50 CRISIL D (ISSUER NOT COOPERATING)
Letter of Credit 0.75 CRISIL D (ISSUER NOT COOPERATING)
Proposed Long 0.75 CRISIL D (ISSUER NOT COOPERATING)
Term Bank Loan
Facility
Working Capital
Facility .25 CRISIL D (ISSUER NOT COOPERATING)
CRISIL has been consistently following up with Al Karma for
obtaining information through letters and emails dated July 31,
2018 and January 15, 2019 among others, apart from telephonic
communication. However, the issuer has remained non cooperative.
'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 Al Karma, which restricts
CRISIL's ability to take a forward looking view on the entity's
credit quality. CRISIL believes information available on Al Karma
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 ratings on bank
facilities of Al Karma continues to be 'CRISIL D/CRISIL D Issuer
not cooperating'.
Al Karma, set up as a partnership firm in 1989 by Ms. Anjali
Chaudhary and Mr. Sandeep Chaudhary, manufactures aluminum doors,
windows, and glass panels. Its manufacturing facility is at
Najafargarh in Delhi.
AMARAVATHI SPINNING: CRISIL Maintains D Ratings in Not Cooperating
------------------------------------------------------------------
CRISIL said the ratings on bank facilities of Amaravathi Spinning
Mills (Rajapalayam) Private Limited (ASMRPL) continues to be
'CRISIL D/CRISIL D Issuer not cooperating'.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Bank Guarantee .53 CRISIL D (ISSUER NOT COOPERATING)
Cash Credit 7.00 CRISIL D (ISSUER NOT COOPERATING)
Export Packing
Credit 0.50 CRISIL D (ISSUER NOT COOPERATING)
Letter of Credit 2.00 CRISIL D (ISSUER NOT COOPERATING)
Proposed Long Term
Bank Loan Facility 1.90 CRISIL D (ISSUER NOT COOPERATING)
CRISIL has been consistently following up with ASMRPL for obtaining
information through letters and emails dated July 31, 2018 and
January 15, 2019 among others, apart from telephonic communication.
However, the issuer has remained non cooperative.
'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 ASMRPL, which restricts CRISIL's
ability to take a forward looking view on the entity's credit
quality. CRISIL believes information available on ASMRPL 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 ratings on bank
facilities of ASMRPL continues to be 'CRISIL D/CRISIL D Issuer not
cooperating'.
Furthermore, the company has not paid the fee for conducting rating
surveillance as agreed to in the rating agreement.
Incorporated in 1989, ASMRPL manufactures cotton yarn. Its facility
in Rajapalayam (Tamil Nadu) has a capacity of 12,168 spindles. Its
operations are spread across Coimbatore, Karur, Salem, and Erode
(all in Tamil Nadu).
BALESHWAR KHARAGPUR: Ind-Ra Cuts INR3,936BB Bank Loan Rating to C
-----------------------------------------------------------------
India Ratings and Research (Ind-Ra) has downgraded Baleshwar
Kharagpur Expressway Limited's (BKEL) bank loans to 'IND C' from
'IND BB-' while migrating it to the non-cooperating category. The
rating was on Rating Watch Negative (RWN). The rating will now
appear as 'IND C (ISSUER NOT COOPERATING)' on the agency's website.
The detailed rating action is:
-- INR3,936.2 bil. Senior project bank loans downgraded; off RWN;
migrated to non-cooperating category with IND C (ISSUER NOT
COOPERATING) rating.
Note: ISSUER NOT COOPERATING: Issuer did not cooperate; based on
the best available information.
KEY RATING DRIVERS
The rating downgrade and RWN resolution follow the classification
of BKEL under 'Red – Indian IL&FS Group Entities' category in the
National Company Law Appellate Tribunal order dated 12 February
2019, which depict the inability of the entity to meet its payment
obligations.
The rating has been migrated to the non-cooperating category, as
the company did not provide Ind-Ra with sufficient information to
assess its liquidity position and repayment capability on
outstanding loans, including no-default statements, despite
continuous requests and follow-ups by the agency. Therefore,
investors and other users are advised to take appropriate caution
while using the rating.
RATING SENSITIVITIES
Positive: The rating will be upgraded on a sustained improvement in
the operational and financial performance leading to adequate cash
flow generation to meet debt obligations and clarity on the ongoing
issues with respect to IL&FS group companies.
COMPANY PROFILE
BKEL operates a 24-year concession project to construct
bridges/structures and repair the existing four-lane highway from
Baleshwar to Kharagpur of National Highway 60 in Odisha and West
Bengal. The project was awarded on a design, build, and finance,
operate and transfer basis by National Highways Authority of India
(NHAI; 'IND AAA'/Stable).
BARWA ADDA: Ind-Ra Lowers Rating on INR14BB Term Loan to C
----------------------------------------------------------
India Ratings and Research (Ind-Ra) has downgraded Barwa Adda
Expressway Limited's (BAEL) term loan rating to 'IND C (ISSUER NOT
COOPERATING)' from 'IND B+ (ISSUER NOT COOPERATING)/RWN'. The
rating was on Rating Watch Negative (RWN).
The instrument-wise rating action is:
-- INR14.40 bil. Term loan due on June 2030 downgraded; off RWN
with IND C (ISSUER NOT COOPERATING) rating.
Note: ISSUER NOT COOPERATING: Issuer did not cooperate; based on
the best available information.
KEY RATING DRIVERS
The rating downgrade and RWN resolution follow the classification
of BAEL under the "Red – Indian IL&FS Group Entities" category in
the National Company Law Appellate Tribunal order dated 12 February
2019, which defines "Red Entities" as "Domestic Group Entities
which cannot meet their payment obligations towards even senior
secured financial creditors, as and when such payment obligations
become due."
The rating has been maintained in the non-cooperating category, as
Barwa Adda Expressway did not provide Ind-Ra sufficient information
to assess its liquidity position and repayment capability on
outstanding loans despite continuous requests and follow-ups by the
agency. Therefore, investors and other users are advised to take
appropriate caution while using the rating.
RATING SENSITIVITIES
Positive: The rating will be upgraded on sustained improvement in
the operational and financial performance, leading to adequate cash
flow generation to meet debt obligations, and clarity on the
on-going issues with respect to IL&FS group companies.
COMPANY PROFILE
BAEL has been granted a 20-year concession by National Highways
Authority of India (NHAI, IND AAA/Stable) to widen (six-laning) the
Barwa-Adda-Panagarh section of NH-2 from km 398.240 to km 521.120,
including the Panagarh Bypass in Jharkhand and West Bengal, on a
design, build, fund, operate, and transfer basis. The original
schedule project completion date was September 26, 2016, and the
revised date shall be in FY19, depending upon the availability of
the requisite right of way from NHAI.
BASUDHA UDYOG: CRISIL Maintains D Ratings in Not Cooperating
------------------------------------------------------------
CRISIL said the ratings on bank facilities of Basudha Udyog Private
Limited (BUPL) continues to be 'CRISIL D/CRISIL D Issuer not
cooperating'.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Cash Credit 15 CRISIL D (ISSUER NOT COOPERATING)
Letter of Credit 60 CRISIL D (ISSUER NOT COOPERATING)
Term Loan 34 CRISIL D (ISSUER NOT COOPERATING)
CRISIL has been consistently following up with BUPL for obtaining
information through letters and emails dated July 31, 2018 and
January 15, 2019 among others, apart from telephonic communication.
However, the issuer has remained non cooperative.
'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 BUPL, which restricts CRISIL's
ability to take a forward looking view on the entity's credit
quality. CRISIL believes information available on BUPL 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 ratings on bank
facilities of BUPL continues to be 'CRISIL D/CRISIL D Issuer not
cooperating'.
BUPL, incorporated in 1992, manufactures low ash metallurgical
(LAM) coke and operates a power plant near Chennai. Its operations
are managed by promoter-director Mr Sanjay Kumar Poddar.
BHARAT SCANS: CRISIL Maintains D Ratings in Not Cooperating
-----------------------------------------------------------
CRISIL said the ratings on bank facilities of Bharat Scans Private
Limited (BSPL) continues to be 'CRISIL D/CRISIL D Issuer not
cooperating'.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Cash Credit .47 CRISIL D (ISSUER NOT COOPERATING)
Long Term Loan 2.75 CRISIL D (ISSUER NOT COOPERATING)
Overdraft 4.00 CRISIL D (ISSUER NOT COOPERATING)
Proposed Working
Capital Facility 1.31 CRISIL D (ISSUER NOT COOPERATING)
Working Capital
Facility .97 CRISIL D (ISSUER NOT COOPERATING)
Working Capital
Term Loan .50 CRISIL D (ISSUER NOT COOPERATING)
CRISIL has been consistently following up with BSPL for obtaining
information through letters and emails dated July 31, 2018 and
January 15, 2019 among others, apart from telephonic communication.
However, the issuer has remained non cooperative.
'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 BSPL, which restricts CRISIL's
ability to take a forward looking view on the entity's credit
quality. CRISIL believes information available on BSPL 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 ratings on bank
facilities of BSPL continues to be 'CRISIL D/CRISIL D Issuer not
cooperating'
Furthermore, the company has not paid the fee for conducting rating
surveillance as agreed to in the rating agreement.
Set up in 1995, BSPL operates six diagnostic centres in Tamil Nadu.
It is promoted by Dr Rajamani Emmanuel Gunaseelan and Dr Beula
Emmanuel.
CAPITAL CABLES: Ind-Ra Maintains BB- LT Rating in Non-Cooperating
-----------------------------------------------------------------
India Ratings and Research (Ind-Ra) has maintained Capital Cables
India Private Limited's (CCIPL) Long-Term Issuer Rating of 'IND BB-
(ISSUER NOT COOPERATING)' in the non-cooperating category and has
simultaneously withdrawn it.
The instrument-wise rating action is:
-- INR100 mil. Fund-based working capital limits* maintained in
the non-cooperating category and withdrawn.
* Maintained in 'IND BB- (ISSUER NOT COOPERATING)' / 'IND A4+
(ISSUER NOT COOPERATING)' before being withdrawn
KEY RATING DRIVERS
CCIPL did not participate in the rating exercise despite continuous
requests and follow-ups by the agency. Ind-Ra is no longer required
to maintain the rating as the agency has received a no-objection
certificate from the rated facility's lender.
COMPANY PROFILE
CCIPL was incorporated in 1981 and is engaged in the trading of
cable wires, switch gears, etc.
CRIYAGEN AGRI: CRISIL Migrates B Rating to Not Cooperating
----------------------------------------------------------
CRISIL has migrated the rating on bank facilities of Criyagen Agri
and Biotech Private Limited (Criyagen) to 'CRISIL B/Stable Issuer
not cooperating'.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Overdraft 7 CRISIL B/Stable (ISSUER NOT
COOPERATING; Rating Migrated)
Term Loan 13 CRISIL B/Stable (ISSUER NOT
COOPERATING; Rating Migrated)
CRISIL has been consistently following up with Criyagen for
obtaining information through letters and emails dated January 23,
2019 and January 29, 2019 among others, apart from telephonic
communication. However, the issuer has remained non cooperative.
'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 Criyagen. Which restricts
CRISIL's ability to take a forward looking view on the entity's
credit quality. CRISIL believes information available on Criyagen
is consistent with 'Scenario 2' outlined in the 'Framework for
Assessing Consistency of Information with CRISIL BBB' rating
category or lower'.
Therefore, on account of inadequate information and lack of
management cooperation, CRISIL has migrated the rating on bank
facilities of Criyagen to 'CRISIL B/Stable Issuer not
cooperating'.
Furthermore, the company has not paid the fee for conducting rating
surveillance as agreed to in the rating agreement.
Criyagen, which was incorporated by promoter, Dr Basavaraj
Girennavar in 2008, manufactures bio-chemical fertilisers.
D K CERAMIC: CRISIL Maintains 'D' Ratings in Not Cooperating
------------------------------------------------------------
CRISIL said the ratings on bank facilities of D K Ceramic (DKC)
continues to be 'CRISIL D/CRISIL D Issuer not cooperating'.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Bank Guarantee 1.25 CRISIL D (ISSUER NOT COOPERATING)
Cash Credit 2.00 CRISIL D (ISSUER NOT COOPERATING)
Proposed Long 5.05 CRISIL D (ISSUER NOT COOPERATING)
Term Bank Loan
Facility
Term Loan 4.20 CRISIL D (ISSUER NOT COOPERATING)
CRISIL has been consistently following up with DKC for obtaining
information through letters and emails dated July 31, 2018 and
January 15, 2019 among others, apart from telephonic communication.
However, the issuer has remained non cooperative.
'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 DKC, which restricts CRISIL's
ability to take a forward looking view on the entity's credit
quality. CRISIL believes information available on DKC 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 ratings on bank
facilities of DKC continues to be 'CRISIL D/CRISIL D Issuer not
cooperating'.
DKC is a Morbi, Gujarat-based partnership firm set up in 2014. The
firm manufactures ceramic wall and floor tiles.
DEMBLA TIMBER: Ind-Ra Moves B+ on INR30MM Debt to Non-Cooperating
-----------------------------------------------------------------
India Ratings and Research (Ind-Ra) has migrated Dembla Timber
Company Private Limited's Long-Term Issuer Rating to the
non-cooperating category. The issuer did not participate in the
rating exercise despite continuous requests and follow-ups by the
agency. Therefore, investors and other users are advised to take
appropriate caution while using the rating. The rating will now
appear as 'IND B+ (ISSUER NOT COOPERATING)' on the agency's
website.
The instrument-wise rating actions are:
-- INR30 mil. Fund-based working capital limits migrated to non-
cooperating category with IND B+ (ISSUER NOT COOPERATING) /
IND A4 (ISSUER NOT COOPERATING) rating; and
-- INR216.1 mil. Non-fund-based limits migrated to non-
cooperating category with IND A4 (ISSUER NOT COOPERATING)
rating.
Note: ISSUER NOT COOPERATING: The ratings were last reviewed on
February 22, 2018. Ind-Ra is unable to provide an update, as the
agency does not have adequate information to review the ratings.
COMPANY PROFILE
Incorporated in 2003, Dembla Timber Company is engaged in the
purchasing and processing of Malaysian timber wood, which is
imported from Singapore and New Zealand. The company imports logs
and processes it as per customer demand and specifications.
DHANVRIDHI COMMERCIAL: CRISIL Keeps D Ratings in Not Cooperating
----------------------------------------------------------------
CRISIL said the ratings on bank facilities of Dhanvridhi Commercial
Private Limited (DCPL) continues to be 'CRISIL D/CRISIL D Issuer
not cooperating'.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Bank Guarantee 2.26 CRISIL D (ISSUER NOT COOPERATING)
Cash Credit 3.88 CRISIL D (ISSUER NOT COOPERATING)
Proposed Long 4.08 CRISIL D (ISSUER NOT COOPERATING)
Term Bank Loan
Facility
Term Loan 4.28 CRISIL D (ISSUER NOT COOPERATING)
CRISIL has been consistently following up with DCPL for obtaining
information through letters and emails dated July 31, 2018 and
January 15, 2019 among others, apart from telephonic communication.
However, the issuer has remained non cooperative.
'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 DCPL, which restricts CRISIL's
ability to take a forward looking view on the entity's credit
quality. CRISIL believes information available on DCPL 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 ratings on bank
facilities of DCPL continues to be 'CRISIL D/CRISIL D Issuer not
cooperating'.
DCPL was incorporated by the Tantia family in Kolkata in 2005. Till
2012, the company traded in materials used in manufacture of
railway wagons/components. It now manufactures railway wagons
through Besco Ltd (foundry division).
DHANYA STEEL: CRISIL Moves D on INT13cr Credit to Not Cooperating
-----------------------------------------------------------------
CRISIL said the ratings on bank facilities of Dhanya Steel
Industries Private Limited (DSIPL; part of the Dhanya group)
continues to be 'CRISIL D Issuer not cooperating'.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Cash Credit 13 CRISIL D (ISSUER NOT COOPERATING)
CRISIL has been consistently following up with DSIPL for obtaining
information through letters and emails dated July 31, 2018 and
January 15, 2019 among others, apart from telephonic communication.
However, the issuer has remained non cooperative.
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 DSIPL, which restricts CRISIL's
ability to take a forward looking view on the entity's credit
quality. CRISIL believes information available on DSIPL 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 ratings on bank
facilities of DSIPL continues to be 'CRISIL D Issuer not
cooperating'.
For arriving at the rating, CRISIL has combined the business and
financial risk profiles of DSIPL and Dhanya TMT Private Limited
(DTPL). This is because the two companies, together referred to as
the Dhanya group, are in similar lines of business and under a
common promoter group, and have significant business and financial
linkages with each other.
Established in December 2007, DSIPL manufactures ingots and
billets. The company has its manufacturing facility in Chittoor
district (Andhra Pradesh).
DYNAMIC ELECTRICALS: CRISIL Keeps INR2cr Debt in Non Cooperating
----------------------------------------------------------------
CRISIL said the ratings on bank facilities of Dynamic Electricals
and Switchgear Private Limited (DESPL) continues to be 'CRISIL
C/CRISIL A4 Issuer not cooperating'.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Bank Guarantee 2.5 CRISIL A4 (ISSUER NOT
COOPERATING)
Cash Credit 2.5 CRISIL C (ISSUER NOT
COOPERATING)
Letter of Credit 0.8 CRISIL A4 (ISSUER NOT
COOPERATING)
CRISIL has been consistently following up with DESPL for obtaining
information through letters and emails dated July 31, 2018 and
January 15, 2019 among others, apart from telephonic communication.
However, the issuer has remained non cooperative.
'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 DESPL, which restricts CRISIL's
ability to take a forward looking view on the entity's credit
quality. CRISIL believes information available on DESPL 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 ratings on bank
facilities of DESPL continues to be 'CRISIL C/CRISIL A4 Issuer not
cooperating'.
DESPL, incorporated in 1997 and promoted by Mr. Dinesh Sharma,
executes electrical works including installation and commissioning
of power cable lines and other power equipment in the civil
construction segment. Based in Noida, Uttar Pradesh, it undertakes
projects for residential and commercial real estate developers
mainly in North India.
FATEH CHAND: Ind-Ra Hikes Bank Term Loan Ratings to 'BB+'
---------------------------------------------------------
India Ratings and Research (Ind-Ra) has upgraded Fateh Chand
Charitable Trust's (FCCT) bank facilities as follows:
-- INR147.2 mil. (reduced from INR255.8 mil.) Term loan due on
March 2023 upgraded with IND BB+/Stable rating; and
-- INR42.8 mil. (increased from INR24.2 mil.) Non-fund-based bank
facilities (bank guarantee) upgraded with IND BB+/Stable
rating.
KEY RATING DRIVERS
The upgrade reflects a significant improvement in FCCT's liquidity
position as cash flow from operations doubled to INR382.96 million
in FY18 (FY17: INR191.38 million), owing to an improvement in
operating profitability. Its financial leverage (available
cash/long-term debt) improved to 8.65% in FY18 (FY17: 6.16%) on
account of repayment of its long-term debt. However, the available
funds/operating expenses declined marginally to 5.20% in FY18
(FY17: 6.87%). Further, the collection period remained almost
stable at 31 days in FY18 (FY17: 29 days).
The total revenue grew 19.99% yoy to INR1,105.57 million in FY18
(FY17: INR921.35 million), mainly due to a surge in average revenue
per student in the MBBS and post-graduation (PG) courses. The
average revenue per MBBS student increased 13.9% yoy to INR1.08
million PG students rose 50% yoy to INR1.8 million in FY18. The
headcount in both the courses largely remained static with the
college reporting 747 students under MBBS in FY18 (FY17: 747) and
75 (71) under PG courses. Revenue from hospital services also grew
28% yoy to INR118 million in FY18 (FY17: down 35% yoy). Ind-Ra
expects the revenue from hospital services to remain volatile due
to variability in a number of patients attended to and medical
services offered to them.
FCCT's overall headcount increased by 3.93% yoy to 1,321 in FY18,
mainly due to a rise in headcount (FY18: 499, FY17: 453) under the
nursing course. However, nursing revenue accounted for merely 2.8%
of the total revenue in FY18 (FY17: 2.76%). Although the overall
headcount fell to 1,282 in the academic year 2018-2019, the impact
on the overall revenue is likely modest, as the drop in headcount
has largely been in the nursing course which fell by 46 yoy.
Approved annual intake increased to 363 students in FY18 (FY17: 344
students) and further rose to 375 students in the academic year
2018-2019, due to an increase in PG course intake to 53 students
(34 students).
The CBBID margins expanded to 34.10% in FY18 (FY17: 26.34%) mainly
on account of better absorption of fixed costs. The trust also
earned a healthy net surplus of INR169.28 million in FY18 (FY17:
net loss of INR0.33 million). The reduction in the long-term debt
along with higher profitability led to an improvement in the credit
metrics with debt/CBBID reducing to 1.16x in FY18 (FY17: 3.12x) and
interest coverage ratio improving to 6.56x (2.88x). The trust's
debt/income also significantly improved to 39.65% in FY18 (FY17:
82.18%).
RATING SENSITIVITIES
Positive: A sustained improvement in the operating performance,
liquidity position and credit metrics, could be positive for the
ratings.
Negative: Declining headcount and/or a significant fall in the
operating margins and/or a significant debt-funded capex, leading
to stress on the liquidity position and deterioration in the credit
metrics could lead to a negative rating action.
COMPANY PROFILE
Established in 2005, FCCT is chaired by Mr. Satish C. Goel and is
affiliated to the Chaudhary Charan Singh University, Meerut.
Approved by Medical Council of India, Muzaffarnagar Medical College
and Hospital, under FCCT's aegis, started its operation in 2006.
The courses offered are MBBS, PG along with para-medical courses to
impart nursing education and training. The admissions are done
through Uttar Pradesh National Eligibility cum Entrance Test. The
college does not offer any part-time courses. The hospital,
presently with a capacity of 700 beds, was established primarily to
support the college as a teaching hospital.
FINECRETE ECO-BLOCKS: CRISIL Keeps D Rating on Non-Cooperating
--------------------------------------------------------------
CRISIL said the ratings on bank facilities of Finecrete Eco-Blocks
Private Limited (Finecrete) continues to be 'CRISIL D Issuer not
cooperating'.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Term Loan 36 CRISIL D (ISSUER NOT COOPERATING)
CRISIL has been consistently following up with Finecrete for
obtaining information through letters and emails dated July 31,
2018 and January 15, 2019 among others, apart from telephonic
communication. However, the issuer has remained non cooperative.
'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 Finecrete, which restricts
CRISIL's ability to take a forward looking view on the entity's
credit quality. CRISIL believes information available on Finecrete
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 ratings on bank
facilities of Finecrete continues to be 'CRISIL D Issuer not
cooperating'.
Finecrete, incorporated in July 2013, has set up a manufacturing
unit of autoclaved aerated concrete (AAC) blocks, or fly ash
bricks. The company's facility is at Panipat, Haryana.
GRANDWAY INC: Ind-Ra Migrates B+ Issuer Rating to Non-Cooperating
-----------------------------------------------------------------
India Ratings and Research (Ind-Ra) has migrated Grandway
Incorporated's Long-Term Issuer Rating to the non-cooperating
category. The issuer did not participate in the rating exercise
despite continuous requests and follow-ups by the agency.
Therefore, investors and other users are advised to take
appropriate caution while using the rating. The rating will now
appear as 'IND B+ (ISSUER NOT COOPERATING)' on the agency's
website.
The instrument-wise rating action is:
-- INR80 mil. Fund-based working capital limits migrated to Non-
Cooperating Category with IND B+ (ISSUER NOT COOPERATING) /
IND A4 (ISSUER NOT COOPERATING) rating.
Note: ISSUER NOT COOPERATING: The ratings were last reviewed on
March 19, 2018. Ind-Ra is unable to provide an update, as the
agency does not have adequate information to review the ratings.
COMPANY PROFILE
Grandway manufactures and exports hosiery garments, and sells
knitted fabric in the domestic market. Its partners are Mr. Ishpaul
Singh, Mr. Kanwardeep Singh, and Mr. Pavneet Singh.
JAI GURUDEV: CRISIL Lowers Ratings on INR8.21cr Loans to B
----------------------------------------------------------
CRISIL has downgraded its rating on the long-term bank facilities
of Jai Gurudev Ginning And Pressing Industries (JGGPI) to 'CRISIL
B/Stable' from 'CRISIL B+/Stable'.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Cash Credit 5.00 CRISIL B/Stable (Downgraded
from 'CRISIL B+/Stable')
Term Loan 3.21 CRISIL B/Stable (Downgraded
from 'CRISIL B+/Stable')
The downgrade reflects deterioration in business risk profile and
liquidity. The deterioration is due to significant decrease in
scale of operation from 64 crore in FY 17 to 32 crore in FY 18
which has affected the liquidity. The firm booked revenue of around
INR30 cr by December 2018 and the scale is expected to grow
moderately in the medium term. Liquidity is seen stretched in terms
of almost full utilization of bank lines in the 12 months until
November 2018. The firm had generated cash accrual of 0.68 crore
against repayment obligation of INR0.78 crore in fiscal 2018. Going
forward, enhancement in the bank line to the extent of INR4 cr is
expected to cushion the liquidity but CRISIL expects the bank lines
to be highly utilized due to the working capital intensive nature
of operations of the firm.
The rating reflects JGGPI's below-average financial risk profile,
modest scale of operation, and susceptibility to cotton price
fluctuations and government regulations. These weaknesses are
partially offset by the experience of the partners.
Key Rating Drivers & Detailed Description
Weakness:
* Below-Average financial risk profile: Networth was modest at
INR5.16 crore as on March 31, 2018, while gearing was moderate at
1.47 times.
* Modest scale of operations and low margin: Revenue of INR31.49
crore in fiscal 2018 reflects small scale of operations, resulting
from intense competition. Operating margins, though improved to
4.5% in FY 2018 from 3.5% in FY 2017 due to operationalization of
oil mill unit, continue to remain low due to intense competition in
business and susceptibility of margins to cotton price movement and
government policy changes.
* Susceptibility to price fluctuations and to government
regulations: The central government fixes the minimum support price
for cotton every year. Along with cotton availability, any adverse
regulatory change may lead to distortion of market prices and
affect profitability of various players in the cotton value chain,
including ginners.
Strengths:
* Experience of partners: Benefits derived from the partners'
experience of 5 years and healthy relations with customers and
suppliers should continue to support the business.
Liquidity
Liquidity is stretched as reflected by cash accrual of INR0.68
crore in fiscal 2018 and expected to be around INR0.60-0.73 crore
against expected debt obligation of around INR0.70-0.78 crore over
the medium term. Bank lines which was utilized at 99% during the 12
months ended November 2018.
Outlook: Stable
CRISIL believes JGGPI will continue to benefit from the experience
of the partners. The outlook may be revised to 'Positive' if
substantial increase in revenue and profitability leads to
higher-than-expected cash accrual. Conversely, the outlook may be
revised to 'Negative' if lower-than-expected revenue and
profitability, stretch in working capital cycle, or any large
capital expenditure weakens liquidity and financial risk profile.
JGGPI was set up in 2015 as a partnership between Ms Sharda Thote,
Mr Chandrashekhar Thote and Mr Sachin Kawale. The firm is a
processer and trader of cotton bales, cotton seeds, cotton seed
cake, and cotton seed oil. Its unit is at Kalamb village in
Yavatmal (Maharashtra).
JSW STEEL: Fitch Affirms 'BB' LT IDR & Sr. Unsecured Rating
-----------------------------------------------------------
Fitch Ratings has affirmed JSW Steel Limited's (JSWS) Long-Term
Issuer Default Rating (IDR) at 'BB' with a Stable Outlook. The
agency has also affirmed JSWS's senior unsecured rating and the
rating on its senior unsecured notes at 'BB'.
The affirmation follows an improvement in JSWS's EBITDA and
leverage in the first nine months of the financial year ending
March 2019 (9MFY19), driven by healthy steel prices. JSWS's ratings
continue to be underpinned by its highly competitive conversion
costs and position as one of the largest steel producers in India,
which is one of the fastest-growing steel markets globally.
However, rating headroom is limited as Fitch expects an increase in
leverage and negative free cash flow (FCF) in FY20-FY21. These
forecasts are driven by Fitch's expectation of a moderation in
steel industry margins in 2019 and an increase in capital spending
as key projects near completion. A further increase in planned
capex, following a jump in planned capex in 2018, or significant
weakening of global steel industry fundamentals could weaken its
financial profile.
Fitch has not consolidated debt related to JSWS's acquisition of
stakes in distressed assets in India, based on management's
strategy of acquiring minority stakes and ring-fencing itself from
liabilities until asset performance improves. Fitch also have not
factored in any further acquisitions. A consolidation of
acquisition-related debt and evidence of weak investment discipline
leading to weaker financial metrics are additional risks to JSWS's
credit profile.
KEY RATING DRIVERS
Steel Market Supportive; but to Moderate: Standalone EBITDA per
tonne of steel sales in 9MFY19 increased by over 60% yoy to around
INR12,300/tonne driven by higher steel prices even as sales volumes
were almost flat. JSWS's standalone operations account for more
than 90% of its consolidated EBITDA. However, global steel prices
have declined since October 2018 and domestic prices in India have
followed suit, despite relatively strong finished steel consumption
growth of around 8% yoy in 3QFY19. In addition, global iron-ore
prices have recently risen after Vale, the world's largest iron-ore
miner, said it would cut around 10% of its output for up to three
years after collapse of a tailings dam in January 2019.
Fitch expects global steel prices and producers' margins to fall in
2019 and have assumed a 20% decrease in standalone EBITDA/tonne in
FY20 in US dollar terms. Margins are likely to be lower, but it
does not forecast an abrupt squeeze such as that seen in 2015.
Fitch expects that restrained exports from China are likely to be a
key support for the global steel sector. However, weak global
economic growth and volatile raw material prices are key risks.
Several Acquisitions, Some Risk: JSWS acquired stakes in several
assets in India and overseas in FY19. In India, the company
acquired 23% of Monnet Ispat and Energy Ltd (Monnet), and has
emerged as the highest bidder for Bhushan Power and Steel Ltd
(BPS). Monnet and BPS have steelmaking capacity of around 1.5
million tonnes per annum (mtpa) and 2.5mtpa, respectively, and
provide exposure to eastern India where JSWS lacks a significant
presence. JSWS also acquired assets in Italy (Aferpi) and the US
(Acero Junction), which give the company a meaningful presence in
Europe and increased capacity in the US. Aferpi has 1.3mtpa of
rolling-mill capacity for rail bars and wire rods, while Acero
Junction has a 3mtpa hot strip mill in Ohio.
JSWS had earlier revised its offer for BPS, and intends to employ a
structure similar to the Monnet acquisition by assuming a minority
stake. Fitch intends to account for BPS using the equity method
after factoring in investment outflows, similar to Monnet, if the
structures are similar. JSWS has yet to secure regulatory approvals
for the BPS acquisition and announce details regarding the
transaction structure. Fitch has not factored in further
acquisitions in itsforecasts; more acquisitions could pressure
JSWS's financial metrics and indicate weaker financial discipline.
Substantial Capex Planned: JSWS intends to spend around INR400
billion over FY19-FY21 in India. Around 50% of the spending is
intended for expansion of crude steel capacity to 24mtpa from
18mtpa, followed by cost-saving and downstream projects. The
additional capacity is due to be commissioned by March 2020. It
will also invest USD500 million in its plate and pipe mill in
Texas, US, mainly for backward integration. These projects should
generate substantial earnings within two years, mitigating risks to
JSWS's financial profile. However, JSWS increased its capex plans
in 2018, and another significant increase could weaken its credit
profile.
Cost-Efficient Operations: JSWS has a dominant market share in
southern and western India, where its plants are located, supported
by a rising share of value-added products. Its highly efficient
operations partly offset its lack of significant vertical
integration. JSWS's main plant at Vijayanagar placed in the second
quartile of CRU's cost curve for flat steel products for 2018. The
company has won mining rights for six iron ore mines in Karnataka,
and it has started production from three mines. It aims to produce
4.5 million-5 million tonnes of iron ore, or about 20% of the
amount needed by its Vijayanagar plant, in FY20. This should
improve supply certainty for JSWS and moderately reduce costs.
Increase in Leverage, Negative FCF: Fitch estimates JSWS's gross
adjusted debt to EBITDAR leverage to increase to above 3.5x in
FY20-FY21, from around 3x in FY19, based on a decline in margins
and an increase in capex as capacity-expansion and other projects
near completion. This is also likely to result in significantly
negative FCF over the next two years. Thereafter, Fitch expects the
increase in output and lower capex to drive a reduction in leverage
and improvement in FCF. Fitch has switched to using a leverage
metric based on EBITDAR rather than funds from operations to allow
adjustments to better reflect the company's increasing minority
stakes.
DERIVATION SUMMARY
JSWS can be compared with domestic peer Tata Steel Limited (TSL,
BB/Rating Watch Evolving), which is rated at 'BB-' on a standalone
basis excluding potential support from Tata Group. TSL's ratings
remain on watch pending the completion of a JV with thyssenkrupp AG
(BB+/Rating Watch Negative) in Europe, which should significantly
improve TSL's operating profile by reducing exposure to structural
weaknesses in Europe.
TSL's standalone rating is based on a combination of robust
operations in India and a much weaker operating profile in Europe,
where the company is on track to cut exposure. Vertical integration
is a key advantage for TSL in India, which is only partly
counterbalanced by JSWS's cost-efficient operations. However, TSL's
leverage was higher than that of JSWS in FY17 and FY18.
ArcelorMittal S.A. (AM, BBB-/Stable) is rated higher than JSWS,
based on ArcelorMittal's position as the world's largest as well as
most diversified steel producer by product type and geography.
ArcelorMittal benefits from a solid and increasing level of
vertical integration into iron ore, with over 50% of its iron ore
needs met by its own output. ArcelorMittal also has significantly
better leverage and coverage metrics than JSWS. These strengths are
partly offset by its thinner margins due to having manufacturing
facilities globally, including large operations in geographies with
structurally high costs such as Europe and the US.
JSWS has a larger EBITDAR scale and better margins than United
States Steel Corporation (BB-/Positive). U.S. Steel's leverage and
coverage metrics are significantly better than those of JSWS, but
its significant exposure to the U.S. oil and gas sector results in
higher demand and earnings volatility than for JSWS.
KEY ASSUMPTIONS
Fitch's Key Assumptions Within Its Rating Case for the Issuer
- Standalone sales volume to have CAGR of 6% over FY19-FY22
- Average of annual standalone EBITDA per tonne of around
INR9,500 over FY20-FY22
- Cumulative consolidated capex of around INR570 billion over
FY19-FY22
- Average annual dividend pay-out of INR9 billion over FY19-FY22
RATING SENSITIVITIES
Developments that May, Individually or Collectively, Lead to
Positive Rating Action
- Total adjusted debt to EBITDAR leverage below 3.0x on a
sustained basis.
- Sustained neutral or positive FCF
Developments that May, Individually or Collectively, Lead to
Negative Rating Action
- Total adjusted debt to EBITDAR leverage above 4.0x for a
sustained period
- Negative FCF for a sustained period
- Evidence of shift away from maintaining investment discipline
LIQUIDITY AND DEBT STRUCTURE
Manageable Liquidity: JSWS reported cash and cash equivalents of
INR15 billion at end-December 2018, and had debt (including revenue
and capital acceptances) of INR589 billion. It also had available
undrawn working-capital facilities (fund and non-fund based) of
around INR114 billion and undrawn lines for capex of INR89billion.
Short-term debt, including the current portion of acceptances,
comprised INR186 billion of the total debt while the current
portion of long-term debt was INR96 billion. Fitch expects JSWS to
rely on drawdown of unutilised lines and refinancing to address its
long-term debt maturities over the next 12 months while its
short-term facilities are rolled over. JSWS's ability to refinance
is supported by its banking relationships and access to diverse
funding sources.
SUMMARY OF FINANCIAL ADJUSTMENTS
Key financial statement adjustments that depart materially from
those contained in the published financial statements include:
- A multiple of 6.6x times has been used to capitalise JSWS's
lease expenses based on the weighted average of expenses in India
and the US.
- JSWS's acceptances, which have been reported under trade
payables (FY18: INR90.3 billion), have been removed from trade
payables and treated as debt. In addition, acceptances related to
payables for capital projects (FY18: INR12.2billion) have been
treated as debt.
- Unamortised upfront fees on borrowing and premium on redemption
of debentures (FY18: INR5.8billion) have been added back to debt.
- JSWS's bank balances in term deposit accounts (FY18:
INR1.7billion) have been treated as readily available while those
related to unclaimed dividends and margin money (FY18: INR3.2
billion) have been treated as restricted.
- The increase in capital acceptances has been added to capex
while the fall in acceptances related to trade payables has been
adjusted in working-capital flows.
- Fitch has calculated change in working capital based on
balance-sheet values for trade receivables, inventories, trade
payables, advances from customers, advances to suppliers and
prepayments.
- Depreciation and amortisation expenses have been adjusted for
export obligation deferred income amortisation (FY18: INR0.7
billion)
KARYAVATTOM SPORTS: Ind-Ra Cuts Rating on Sr. Project Loans to C
----------------------------------------------------------------
India Ratings and Research (Ind-Ra) has downgraded Karyavattom
Sports Facilities Limited's (KSFL) bank loans to 'IND C' from 'IND
BB' while migrating it to the non-cooperating category. The rating
was on Rating Watch Negative (RWN). The rating will now appear as
'IND C (ISSUER NOT COOPERATING)' on the agency's website.
The instrument-wise rating actions are:
-- INR1.680 mil. Senior project bank loans downgraded; off RWN;
migrated to non-cooperating category with IND C (ISSUER NOT
COOPERATING) rating; and
-- INR735 mil. Senior project bank loans downgraded; off RWN;
migrated to non-cooperating category with IND C (ISSUER NOT
COOPERATING) rating.
Note: ISSUER NOT COOPERATING: Issuer did not cooperate; based on
the best available information.
KEY RATING DRIVERS
The downgrade and the RWN resolution follow the classification of
KSFL under 'Red – Indian IL&FS Group Entities' category in the
National Company Law Appellate Tribunal order dated 12 February
2019, which defines "Red Entities" as "Domestic Group Entities
which cannot meet their payment obligations towards even senior
secured financial creditors, as and when such payment obligations
become due."
The rating has been migrated to the non-cooperating category as the
company did not provide Ind-Ra with information related to its
business and financial profiles, including no-default statements,
despite continuous requests and follow-ups by the agency.
Therefore, investors and other users are advised to take
appropriate caution while using the rating.
RATING SENSITIVITIES
Positive: The rating will be upgraded on sustained improvement in
the operational and financial performance, leading to adequate cash
flow generation to meet debt obligations, and clarity on the
on-going issues with respect to the IL&FS group companies.
COMPANY PROFILE
KSFL is a special purpose vehicle sponsored by ITNL. It was set up
to develop a multi-purpose Greenfield stadium in Karyavattom,
Thiruvananthapuram, Kerala, on a design, build, operate and
transfer annuity basis. The project achieved the final completion
date on February 29, 2016.
KVR INDUSTRIES: CRISIL Maintains D Ratings in Not Cooperating
-------------------------------------------------------------
CRISIL said the ratings on bank facilities of KVR Industries
Limited (KVRIL) continues to be 'CRISIL D Issuer not cooperating'.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Cash Credit 27.08 CRISIL D (ISSUER NOT COOPERATING)
Funded Interest
Term Loan 1.92 CRISIL D (ISSUER NOT COOPERATING)
Long Term Loan 16.00 CRISIL D (ISSUER NOT COOPERATING)
CRISIL has been consistently following up with KVRIL for obtaining
information through letters and emails dated August 31, 2018 and
January 15, 2019 among others, apart from telephonic communication.
However, the issuer has remained non cooperative.
'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 KVRIL, which restricts CRISIL's
ability to take a forward looking view on the entity's credit
quality. CRISIL believes information available on KVRIL 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 ratings on bank
facilities of KVRIL continues to be 'CRISIL D Issuer not
cooperating'.
Incorporated in 2009, KVRIL manufactures newsprint paper and
writing and printing paper. The company is promoted by Mr. Kotha
Venkata Rao.
NATVAR COTEX: CRISIL Assigns B+ Ratings to INR7.54cr LT Loan
------------------------------------------------------------
CRISIL has assigned its 'CRISIL B+/Stable' rating to the long-term
bank facilities of Natvar Cotex Private Limited (NCPL).
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Cash Credit 6 CRISIL B+/Stable (Assigned)
Proposed Long Term
Bank Loan Facility 1.54 CRISIL B+/Stable (Assigned)
The ratings reflect the modest scale of operations in the highly
competitive cotton ginning industry, the thin operating margin,
susceptibility to volatile cotton prices and stringent regulations
governing the cotton industry, and the weak financial risk profile.
These weaknesses are mitigated by the extensive experience of
NCPL's promoters in the cotton trading business, and the funding
support provided by them.
Analytical Approach
To arrive at the rating, CRISIL has treated unsecured loans of
INR2.46 crore, extended by NCPL's promoters, as on March 31, 2018,
as neither debt nor equity as these loans are subordinated to bank
debt, and are expected to remain in the business over the medium
term.
Key Rating Drivers & Detailed Description
Weakness
* Modest scale of operations in the highly competitive cotton
industry: Intense competition and limited differentiation in
products in the cotton ginning industry, and NCPL's small
manufacturing capacity, restrict scalability of operations and the
pricing power with customers.
* Low operating margin, susceptible to volatility in cotton prices
and the regulatory framework: As cotton is an agricultural
commodity, its availability depends on the monsoon. Moreover,
government interventions and fluctuations in global cotton output
have led to sharp volatility in cotton prices. Any abrupt change in
regulations can distort market prices and affect profitability of
players across the value chain, including ginners.
* Weak financial risk profile: Financial risk profile remains weak,
marked by a small net worth and high gearing of INR2.43 crore and
2.44 times, respectively, as on March 31, 2018. Debt protection
metrics remain moderate with interest coverage and net cash accrual
to adjusted debt ratios at 1.9 times and 0.05 time, respectively,
for fiscal 2018.
Strengths
* Promoters' extensive industry experience: Longstanding presence
of over a decade in the cotton industry, has enabled the promoters,
develop a strong understanding of local market dynamics, and
establish healthy relationships with farmers, and these factors
should help the company sustain its revenue growth, going forward.
* Funding support from promoters: Promoters will continue to
support operations, as and when required, and have extended
unsecured loans of INR2.46 crore as on March 31, 2018.
Liquidity
* Low bank limit utilization: Bank limit utilization is low around
40 percent for the past twelve months ended December 31, 2018.
CRISIL believes that bank limit utilization is expected to remain
low on account of low working capital requirement.
* Adequate cash accruals: Cash accrual are expected to be over
INR20 lacs which will wholly act as cushion to the liquidity of the
company as the company has completed the repayment of term loan in
FY 17-18.
* Moderate current ratio: Current ratio are moderate at 1.46 times
as on March 31, 2018.
Outlook: Stable
CRISIL believes NCPL will continue to benefit from the extensive
experience of its promoters. The outlook may be revised to
'Positive' if the firm stabilizes operations at its proposed plant
on time, and reports significant growth in revenue and
profitability. The outlook may be revised to 'Negative' if NCPL
faces a considerable delay in commencement of operations, generates
lower-than-expected cash accrual during the initial phase, or if a
sharp increase in working capital requirement, weakens liquidity.
NCPL was set up in 2013, at Morbi (Gujarat). The company gins and
presses cotton, and is owned and managed by Mr Harsh Vadgashiya, Mr
Chandresh Manek, Mr Shailesh Manek and Mr Ashok Vadgashiya.
NIKHIL FOOTWEARS: CRISIL Maintains D Ratings in Not Cooperating
---------------------------------------------------------------
CRISIL said the ratings on bank facilities of Nikhil Footwears
Private Limited (NFPL) continues to be 'CRISIL D/CRISIL D Issuer
not cooperating'.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Cash Credit 50 CRISIL D (ISSUER NOT COOPERATING)
Letter of Credit 20 CRISIL D (ISSUER NOT COOPERATING)
Standby Letter
of Credit 3 CRISIL D (ISSUER NOT COOPERATING)
Term Loan 7.64 CRISIL D (ISSUER NOT COOPERATING)
CRISIL has been consistently following up with NFPL for obtaining
information through letters and emails dated July 31, 2018 and
January 15, 2019 among others, apart from telephonic communication.
However, the issuer has remained non cooperative.
'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 NFPL, which restricts CRISIL's
ability to take a forward looking view on the entity's credit
quality. CRISIL believes information available on NFPL 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 ratings on bank
facilities of NFPL continues to be 'CRISIL D/CRISIL D Issuer not
cooperating'.
NFPL, established in 1987, is promoted and managed by Mr Naresh
Agarwal. The company manufactures footwear at its facilities in
Kundli and Bahadurgarh, both in Haryana.
PEARL INTERNATIONAL: Ind-Ra Migrates BB Ratings to Non-Cooperating
------------------------------------------------------------------
India Ratings and Research (Ind-Ra) has migrated Pearl
International Tours and Travels Limited's Long-Term Issuer Rating
to the non-cooperating category. The issuer did not participate in
the rating 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 BB (ISSUER NOT COOPERATING)' on the agency's
website.
The instrument-wise rating actions are:
-- INR25 mil. Term loan due on March 2021 migrated to non-
cooperating category with IND BB (ISSUER NOT COOPERATING)
rating; and
-- INR190 mil. Fund-based working capital limit migrated to non-
cooperating category with IND BB (ISSUER NOT COOPERATING) /
IND A4+ (ISSUER NOT COOPERATING) rating.
Note: ISSUER NOT COOPERATING: The ratings were last reviewed on
March 9, 2018. Ind-Ra is unable to provide an update, as the agency
does not have adequate information to review the ratings.
COMPANY PROFILE
Incorporated in 1990, Pearl International Tours and Travels provide
global corporate travel management services to companies on a
commission basis. The company is headquartered in New Delhi and has
branches in Lucknow, Jaipur, and Chandigarh.
SANMARG PROJECTS: Ind-Ra Withdraws BB- on 3 Debt Tranches
---------------------------------------------------------
India Ratings and Research (Ind-Ra) has maintained Sanmarg Projects
Private Limited's Long-Term Issuer Rating of 'IND BB-(ISSUER NOT
COOPERATING)' in the non-cooperating category and has
simultaneously withdrawn it.
The instrument-wise rating actions are:
-- INR25.00 mil. Fund-based working capital limits* maintained in
the non-cooperating category and withdrawn;
-- INR48.03 mil. Term loans due on March 2021 maintained in the
non-cooperating category and withdrawn; and
-- INR115.0 mil. Non-fund-based limits^ maintained in the non-
cooperating category and withdrawn.
* Maintained in 'IND BB- (ISSUER NOT COOPERATING)' / 'IND A4+
(ISSUER NOT COOPERATING)' before being withdrawn
$ Maintained in 'IND BB- (ISSUER NOT COOPERATING)' before being
withdrawn
^ Maintained in 'IND A4+ (ISSUER NOT COOPERATING)' before being
withdrawn
KEY RATING DRIVERS
Sanmarg Projects did not participate in the rating exercise despite
continuous requests and follow-ups by the agency. Ind-Ra is no
longer required to maintain the rating as the agency has received a
no-objection certificate from the rated facility's lender.
COMPANY PROFILE
Sanmarg Projects provides industrial consultation and construction
supervision for the integration of operations and the maintenance
of assets of oil and gas companies.
SFPL CROP: CRISIL Lowers Rating on INR7.5cr Cash Loan to D
----------------------------------------------------------
CRISIL has downgraded its rating on the long-term bank facilities
of SFPL Crop Life Science Private Limited (SFPL) to 'CRISIL D' from
'CRISIL B/Stable'.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Cash Credit 7.5 CRISIL D (Downgraded from
'CRISIL B/Stable')
The downgrade reflects on the stretch on the liquidity profile of
the company as seen from full utilization of bank lines and
overdrawals which were not regularized for more than 30 days.
CRISIL's rating continues to reflect below-average financial risk
profile because of small net worth, and average capital structure
and debt protection metrics. The rating also factors in large
working capital requirement. These weaknesses are partially offset
by promoters' extensive industry experience and funding support,
and established distribution and sales network.
Key Rating Drivers & Detailed Description
Weakness:
* Overdrawals in bank lines: The company has been utilizing its
bank lines to the fullest and additionally there are instances of
overdrawals which have not been regularized in more than 30 days.
This is due to stretch in liquidity of the company.
* Weak financial risk profile: The capital structure remained below
average because of small networth with negative networth of
(INR1.65 crore as on March 31, 2018) and weak debt protection
metrics of NCATD and interest coverage ratio of 0.03 and 1.3 times
over the medium term, driven by low cash accrual.
* Working capital management: Gross current asset were 479 days as
on March 31, 2018, driven by high debtors and high inventory of 272
days and 219 days, respectively.
Strengths:
* Experience of promoter: The Karwa family has been in the business
of producing seeds for over 30 years and they set up SFPL to
diversify into manufacturing of fertilizers and also for
distributing their seeds. CRISIL believes that the company will
benefit from promoters' extensive experience and its strong
distribution network.
Liquidity
SFPL generated cash accrual of 0.57 crore against repayment
obligation of 0.03 crore in fiscal 2018. Bank lines were fully
utilized during the 12 months ended January 2019 on account of
working capital-intensive operations. There are overdrawals in bank
lines which SFPL delayed in regularizing. However, the need based
funding support from the promoters provide some comfort to
liquidity profile. The current ratio is moderate at 1.31 times as
on March 2018.
SFPL was incorporated in 1999 as Subhash Fertilizers Pvt Ltd and
was later renamed as SFPL. The company is a fully owned subsidiary
of KSPL, which produces and markets seeds for the commercial seed
market. SFPL manufactures nitrogen, phosphorus, and potassium mixed
fertilizers. It is the sole distributor of hybrid vegetable seeds
of group company Krishnadhan Vegetable Seeds India Pvt Ltd across
India.
SHRI BALAJI: CRISIL Withdraws B- Rating from Not Cooperating
------------------------------------------------------------
CRISIL has migrated the ratings on bank facilities of Shri Balaji
Packaging (SBP) from 'CRISIL B-/Stable/Issuer Not Cooperating to
'CRISIL B-/Stable'. The rating action is in line with CRISIL's
policy on withdrawal of bank loan ratings.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Cash Credit 4.16 CRISIL B-/Stable (Migrated from
'CRISIL B-/Stable ISSUER NOT
COOPERATING'; Rating Withdrawn)
Term Loan 5.84 CRISIL B-/Stable (Migrated from
'CRISIL B-/Stable ISSUER NOT
COOPERATING'; Rating Withdrawn)
Due to inadequate information, CRISIL, in line with SEBI
guidelines, had migrated the rating of SBP to 'CRISIL
B-/Stable/Issuer not cooperating'. CRISIL has withdrawn its rating
on bank facility of SBP following a request from the company and on
receipt of a 'no dues certificate' from the banker. Consequently,
CRISIL is migrating the ratings on bank facilities of SBP from
'CRISIL B-/Stable/Issuer Not Cooperating to 'CRISIL B-/Stable'. The
rating action is in line with CRISIL's policy on withdrawal of bank
loan ratings.
SBP is a partnership firm setup in 2010 and is engaged in
manufacturing of corrugated boxes. The firm is owned by Mr. Arpit
Bangur and Mrs. Mangla Bangur. It has a manufacturing unit at Baddi
with a fully-automated corrugation line.
SHRI KALKA: CRISIL Reaffirms B+ Ratings on INR9.75cr Loans
----------------------------------------------------------
CRISIL has reaffirmed its rating on the long-term facilities of
Shri Kalka Agro Industries (SKAI) at 'CRISIL B+/Stable'.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Cash Credit 7.25 CRISIL B+/Stable (Reaffirmed)
Proposed Long Term
Bank Loan Facility 2.50 CRISIL B+/Stable (Reaffirmed)
The rating reflects SKAI's modest scale of operations in the
intensely competitive cotton ginning industry and its below-average
financial risk profile. These weaknesses are partially offset by
the extensive experience of SKAI's partners in the cotton ginning
business.
Key Rating Drivers & Detailed Description
Weakness:
* Modest scale of operations: Intense competition and limited
capacity has resulted in the revenues at INR42 crore in fiscal
2017. These factors restrict benefits arising from economies of
scale and limit pricing flexibility, thus constraining
profitability.
* Below-average financial risk profile: Networth was small at
INR2.4 crore, and gearing high at over 2.56 times, as on March 31,
2017. Interest coverage ratio was average at 1.9 times in fiscal
2017.
Strengths:
* Extensive experience of the partners: Benefits from the partners'
two decades of experience and established relationships with
customers and suppliers should support the business.
Liquidity
SKAI has adequate liquidity driven by expected cash accruals of
more than INR0.3 crore per annum in FY19 and FY20 and moderate cash
and cash equivalents as on March 31, 2018. SKAI also has access to
fund based limits of INR7.25 crores, utilized to the tune of 56% on
an average over the 12 months ended December 2018. The company does
not have any long term repayment obligations in FY19 and FY20 and
no capex plans.
Outlook: Stable
CRISIL believes SKAI will continue to benefit from the extensive
experience of its partners. The outlook may be revised to
'Positive' if high cash accrual or capital infusion strengthens
financial risk profile. The outlook may be revised to 'Negative' if
low cash accrual, large debt-funded capital expenditure, or stretch
in working capital cycle weakens financial risk profile, especially
liquidity.
Established in 2007, SKAI is a partnership firm of Mr Dinesh Tayal
and Mr Rajesh Tayal. The firm gins and presses raw cotton (kapas)
to produce cotton bales. Its manufacturing facility is in Deulgaon
Raja (Maharashtra).
SIKAR BIKANER: Ind-Ra Cuts INR4BB Senior Project Loan Rating to 'C'
-------------------------------------------------------------------
India Ratings and Research (Ind-Ra) has downgraded Sikar Bikaner
Highway Ltd.'s (SBHL) bank loans' rating to 'IND C (ISSUER NOT
COOPERATING)' from 'IND B+ (ISSUER NOT COOPERATING)' while
maintaining it in the non-cooperating category. The rating was on
Rating Watch Negative (RWN). The rating will now appear as 'IND C
(ISSUER NOT COOPERATING)' on the agency's website.
The instrument-wise rating action is:
-- INR4.0 bil. Senior project bank loans downgraded; Off RWN with
IND C (ISSUER NOT COOPERATING)b rating.
Note: ISSUER NOT COOPERATING: Issuer did not cooperate; Based on
the best available information
KEY RATING DRIVERS
The downgrade and the RWN resolution follow the classification of
Sikar Bikaner Highway under 'Red – Indian IL&FS Group Entities'
category in the National Company Law Appellate Tribunal order dated
February 12, 2019, which defines the 'Red Entities' as 'Domestic
Group Entities which cannot meet their payment obligations towards
even senior secured financial creditors, as and when such payment
obligations become due.
The rating has been maintained in the non-cooperating category, as
Sikar Bikaner Highway did not provide Ind-Ra sufficient information
to assess its liquidity position and repayment capability on
outstanding loans despite continuous requests and follow-ups by the
agency. Therefore, investors and other users are advised to take
appropriate caution while using the rating.
RATING SENSITIVITIES
Positive: The rating will be upgraded on a sustained improvement in
the operational and financial performance leading to adequate cash
flow generation to meet debt obligation and clarity on the ongoing
issues with respect to IL&FS group companies.
COMPANY PROFILE
Sikar Bikaner Highway, which is wholly owned by IL&FS
Transportation Networks Limited ('IND D'), is a special purpose
company incorporated to undertake the widening and operations of a
combination of a two-lane and a four-lane highway (National Highway
11) in Rajasthan. The concession grantor is the Public Works
Department of the government of Rajasthan. The concession is for 25
years, with a right to collect toll during the concession. The
security and terms of the subordinate debt agreement are junior to
the senior debt.
STAR AGRO: CRISIL Maintains D Ratings in Not Cooperating Category
-----------------------------------------------------------------
CRISIL said the ratings on bank facilities of Star Agro Marine
Exports Private Limited (SAME) continues to be 'CRISIL D/CRISIL D
Issuer not cooperating'.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Foreign Bill
Discounting 91 CRISIL D (ISSUER NOT COOPERATING)
Foreign Letter
of Credit 14 CRISIL D (ISSUER NOT COOPERATING)
Long Term Loan 17.45 CRISIL D (ISSUER NOT COOPERATING)
Packing Credit 50 CRISIL D (ISSUER NOT COOPERATING)
Standby Letter
of Credit 96 CRISIL D (ISSUER NOT COOPERATING)
CRISIL has been consistently following up with SAME for obtaining
information through letters and emails dated August 31, 2018 and
January 15, 2019 among others, apart from telephonic communication.
However, the issuer has remained non cooperative.
'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 SAME, which restricts CRISIL's
ability to take a forward looking view on the entity's credit
quality. CRISIL believes information available on SAME 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 ratings on bank
facilities of SAME continues to be 'CRISIL D/CRISIL D Issuer not
cooperating'.
Established in 1998 by Mr. Shaik Abdul Aziz, the Star group
undertakes cultivation, processing, and export of shrimp. The group
is based in Nellore (Andhra Pradesh) with its subsidiaries in
United States of America and United Kingdom.
SURAJ UDYOG: Ind-Ra Maintains BB- Issuer Rating in Non-Cooperating
------------------------------------------------------------------
India Ratings and Research (Ind-Ra) has maintained Suraj Udyog's
(SU) Long-Term Issuer Rating of 'IND BB- (ISSUER NOT COOPERATING)'
in the non-cooperating category and has simultaneously withdrawn
it.
The instrument-wise rating actions are:
-- The 'IND BB-' rating on the INR180.00 mil. Fund-based working
capital limits* maintained in non-cooperating category and
withdrawn; and
-- The 'IND BB-' rating on the INR 20.0 mil. Proposed fund-based
working capital limits# maintained in non-cooperating
category and withdrawn.
* Maintained in 'IND BB- (ISSUER NOT COOPERATING)'/'IND A4+ (ISSUER
NOT COOPERATING)' before being withdrawn
# Maintained in 'Provisional IND BB- (ISSUER NOT
COOPERATING)'/'Provisional IND A4+ (ISSUER NOT COOPERATING)' before
being withdrawn
KEY RATING DRIVERS
SU did not participate in the rating exercise despite continuous
requests and follow-ups by the agency. Ind-Ra is no longer required
to maintain the rating as the agency has received a no-objection
certificate from the rated facility's lender.
COMPANY PROFILE
Established in 2001, SU is a proprietorship unit engaged in
manufacturing metallic ingots and industrial zinc products for
paint, rubber, ceramic and pharmaceutical companies.
THANGAMMAN TEXTILES: CRISIL Moves D Rating to Not Cooperating
-------------------------------------------------------------
CRISIL has migrated the rating on bank facilities of Thangamman
Textiles - Coimbatore (TT) to 'CRISIL D/CRISIL D Issuer not
cooperating'.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Bank Guarantee 0.39 CRISIL D (ISSUER NOT COOPERATING;
Rating Migrated)
Cash Credit 2.75 CRISIL D (ISSUER NOT COOPERATING;
Rating Migrated)
Term Loan 3.86 CRISIL D (ISSUER NOT COOPERATING;
Rating Migrated)
CRISIL has been consistently following up with TT for obtaining
information through letters and emails dated January 24, 2019 and
January 29, 2019 among others, apart from telephonic communication.
However, the issuer has remained non cooperative.
'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 TT. CRISIL believes information
available on TT is consistent with 'Scenario 1' outlined in the
'Framework for Assessing Consistency of Information with CRISIL BB'
rating category or lower'.
Therefore, on account of inadequate information and lack of
management cooperation, CRISIL has migrated the rating on bank
facilities of TT to 'CRISIL D/CRISIL D Issuer not cooperating'.
Incorporated in 2014, TT is engaged into manufacturing of yarns.
The day to day operations are managed by Mr Gopalkrishnan.
VEESONS ENERGY: CRISIL Maintains 'D' Ratings in Not Cooperating
---------------------------------------------------------------
CRISIL said the ratings on bank facilities of Veesons Energy
Systems Private Limited (Veesons) continues to be 'CRISIL D/ CRISIL
D Issuer not cooperating'.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Bank Guarantee 14 CRISIL D (ISSUER NOT COOPERATING)
Cash Credit 36 CRISIL D (ISSUER NOT COOPERATING)
Letter of Credit 16.5 CRISIL D (ISSUER NOT COOPERATING)
Proposed Long Term
Bank Loan Facility 3.83 CRISIL D (ISSUER NOT COOPERATING)
Term Loan 30.23 CRISIL D (ISSUER NOT COOPERATING)
Working Capital
Term Loan 8.00 CRISIL D (ISSUER NOT COOPERATING)
CRISIL has been consistently following up with Veesons for
obtaining information through letters and emails dated July 31,
2018 and January 15, 2019 among others, apart from telephonic
communication. However, the issuer has remained non cooperative.
'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 Veesons, which restricts
CRISIL's ability to take a forward looking view on the entity's
credit quality. CRISIL believes information available on Veesons 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 ratings on bank
facilities of Veesons continues to be 'CRISIL D/CRISIL D Issuer not
cooperating'.
Furthermore, the company has not paid the fee for conducting rating
surveillance as agreed to in the rating agreement.
Veesons commenced operations as a partnership firm in 1981 and was
reconstituted as a private limited company in 1994. The company
manufactures boilers and boiler components, besides undertaking
erection, procurement, and commissioning contracts to set up
boilers. Other services include conversion, modification, and
renovation of existing boilers.
VELAVEN POLYMERS: Ind-Ra Affirms 'D' Long Term Issuer Rating
------------------------------------------------------------
India Ratings and Research (Ind-Ra) has affirmed Velaven Polymers
Private Limited's Long-Term Issuer Rating at 'IND D (ISSUER NOT
COOPERATING)'. The issuer did not participate in the rating
exercise despite continuous requests and follow-ups by the agency.
Thus, the rating is based on the best available information. The
rating will continue to appear as 'IND D (ISSUER NOT COOPERATING)'
on the agency's website.
The instrument-wise rating actions are:
-- INR144 mil. Term loan (long-term) due on May 2026 affirmed
with IND D (ISSUER NOT COOPERATING) rating;
-- INR50 mil. Fund-based limits (long-term/ short-term) affirmed
with IND D (ISSUER NOT COOPERATING) rating; and
-- INR5 mil. Non-fund-based limits (short-term) affirmed with IND
D (ISSUER NOT COOPERATING) rating.
Note: ISSUER NOT COOPERATING: Issuer did not cooperate; based on
the best available information.
KEY RATING DRIVERS
The affirmation reflects the classification of the company as a
non-performing asset by lenders during the 12 months ended February
2019.
RATING SENSITIVITIES
Positive: Timely debt servicing for three consecutive months could
result in a rating upgrade.
COMPANY PROFILE
Velaven Polymers was established in August 2015 to manufacture
flexible intermediate bulk container bags, polypropylene bags,
woven sacks, and jumbo Bags. Mrs. A Amudha, Mr. T Ashok Kumar, Mr.
P Thangavelu, and Mr. P Chandrasekar are the promoters of the
company.
VIMAX CROP: CRISIL Lowers Ratings on INR15cr Loans to B-
--------------------------------------------------------
CRISIL has downgraded its rating on the long term bank facilities
of Vimax Crop Science Limited (VCSL) to 'CRISIL B-/Stable' from
'CRISIL B+/Stable'.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Cash Credit 8 CRISIL B-/Stable (Downgraded
from 'CRISIL B+/Stable')
Proposed Long 7 CRISIL B-/Stable (Downgraded
Term Bank Loan from 'CRISIL B+/Stable')
Facility
The downgrade reflects deterioration in business and financial risk
profile, as reflected in after tax loss of INR8.18 crore in fiscal
2018, on account of subdued operating margin and scale of
operations, leading to erosion in networth. Revenue for fiscal 2018
declined to INR21.8 crore from INR37.8 crore in the previous
fiscal, mainly due to sales return from the dealers during GST
implementation period.
The ratings continue to reflect large working capital requirement,
modest scale of operations and volatility in operating margin.
These weaknesses are partially offset by extensive experience of
the promoters in the agrochemical industry and established
relationship with dealers and suppliers.
Key Rating Drivers & Detailed Description
Weaknesses
* Large working capital requirement: Operations are working capital
intensive, as reflected in GCA of 388 days as on March 31, 2018,
emanating from debtors of 121 days and inventory of 119 days.
* Modest scale of operations and volatility in operating margin:
Revenue has remained volatile, ranging between INR21.8 crore to
INR37.8 crore in past 5 fiscals on account of agriculture being
dependent on rainfall and change in the crop pattern of farmers.
Operating margin has also fluctuated due to change in product mix
as per the demand scenario.
Strength
* Promoters' extensive experience in agrochemical industry and
established relationship with customers and suppliers: The
promoters have an experience of close to a decade in agrochemical
industry, which enables them to innovate the products as per
customer requirement. VCSL has rapidly expanded its distribution
network, with over 1700 dealers in eight states. The promoters'
extensive experience will continue to help VCSL over the medium
term.
Liquidity
* High bank limit utilization: The company enjoys fund based
facility (Cash Credit) of INR8.0 crore, almost fully utilized as on
Jan 2019. Average bank limit utilization for past 12 months ended
Dec 2018 was high, at 99%.
* Cash accrual and debt repayment: Cash accruals are expected to
remain low, below INR15-18 lacs per year over the medium term.
However, there are no term debt repayment obligations and capex
plan also continues to remain nil for the medium term.
* Current ratio: The ratio was low, at 0.87 times as on March 31,
2018.
Outlook: Stable
CRISIL believes that the VCSL will continue to benefit from its
promoter's extensive business experience over the medium term. The
outlook may be revised to 'Positive' if the company registers
higher than expected sales while profitability is sustained,
leading to better accrual, or any significant improvement in
working capital management, while improving its profitability.
Conversely, the outlook may be revised to 'Negative' if there is a
considerable decline in revenue and profitability, or significant
deterioration in the company's capital structure on account of
larger-than-expected working capital requirement or substantial
debt-funded capital expenditure.
Incorporated in 2010, VCSL manufactures insecticides, fungicides,
herbicides, organic products, and other such products. The
company's manufacturing facility is at Rajkot, Gujarat.
VINAY POULTRY: CRISIL Assigns D Rating to INR8cr LT Loan
--------------------------------------------------------
CRISIL has assigned its 'CRISIL D' rating to the long-term bank
facilities of Vinay Poultry Farm Private Limited (VPFPL).
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Long Term Loan 8 CRISIL D (Assigned)
The rating reflects instances of delay by the company in servicing
its term-debt interest obligations.
The rating also factors in the exposure to risks related to ongoing
project and expected leveraged capital structure. These weaknesses
are partly offset by the extensive experience of the promoters.
Key Rating Drivers & Detailed Description
* Delays in debt servicing: There have been delays in interest
repayment of 3-10 days due to weak liquidity. The company has weak
liquidity owing to initial stage of operation.
Weaknesses
* Exposure to risks related to ongoing project: The project has
commenced operations in July 2018. Demand risk is also expected to
be moderate on account of intense competition due to large number
of players in the industry owing to modest capital and
technological requirements.
* Expected leveraged capital structure: Financial risk profile is
expected to be average with high gearing and moderate debt
protection metrics as the project is aggressively funded in a
debt-equity ratio 2.1 times.
Strength
* Experience of promoters: The promoter's decade long experience in
the feed manufacturing industry will support the company's business
risk profile with the established relationship with customers and
suppliers.
Liquidity
The company has weak liquidity marked by delays in debt servicing.
Delays in debt servicing is owing to initial stages of operation.
VPFPL, which commenced operations in July 2018, is involved in
hatching of eggs through layering farm with 5 sheds of 75,000 birds
each. Mr V Palanisamy and Mr P Thilagam manage the operations.
=========
J A P A N
=========
UNITIKA LIMITED: Egan-Jones Lowers Commercial Paper Ratings to B
----------------------------------------------------------------
Egan-Jones Ratings Company, on February 19, 2019, downgraded the
foreign currency and local currency commercial paper ratings on
debt issued by Unitika Limited to B from A3.
Unitika Limited is a Japanese company based in Osaka, Japan.
Primarily, the company produces various textiles, glass, plastics,
and carbon fiber products. They are also known for their films,
which are used in consumer products like athletic apparel and food
packaging.
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N E W Z E A L A N D
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MAINZEAL PROPERTY: Contractors Fear Owed Millions Won't Be Repaid
-----------------------------------------------------------------
Radio New Zealand reports that tradies owed millions of dollars
from failed construction company Mainzeal Property aren't convinced
they'll ever see a single cent.
Mainzeal was New Zealand's third largest construction company when
it collapsed in 2013, owing creditors more than NZ$110 million.
Last year, the liquidators took a civil lawsuit against some of its
directors, including former Prime Minister Dame Jenny Shipley.
On Feb. 26, the High Court ruled the directors had failed in their
duties and were liable for NZ$36 million, RNZ relays.
RNZ says Justice Cooke found that Mainzeal's directors traded
recklessly.
RNZ relates that Justice Cook's 178-page ruling found Richard Yan
liable for NZ$36 million, of which NZ$18 million is shared equally
between directors Dame Jenny Shipley, Clive Tilby and Peter Gomm.
But that is cold comfort for some, the report says.
According to RNZ, Tim Smith's company Smith Crane and Construction
was subcontracted to demolish buildings in post-quake Christchurch.
When Mainzeal went belly up, Mr. Smith was owed NZ$1.3 million, RNZ
notes. He said he'll be surprised if he gets that back.
About Mainzeal Property
Mainzeal Property and Construction Ltd is a New Zealand-based
property and construction company. The company forms part of the
Mainzeal Group, which is owned by Richina Inc, a privately held New
Zealand-based company with a strong China focus.
On Feb. 6, 2013, Colin McCloy and David Bridgman, partners from
PricewaterhouseCoopers, were appointed receivers to Mainzeal
Property and Construction Limited and associated entities as a
result of a request made by its director to BNZ.
Mainzeal's director, Richard Yan advised that following a series of
events that had adversely affected the Company's financial position
coupled with a general decline in major commercial construction
activity, and in the absence of further shareholder
support, the Company could no longer continue trading.
On Feb. 28, 2013, BDO's Andrew Bethell and Brian Mayo-Smith were
appointed liquidators to those three companies in receivership and
nine others in the group that were not in receivership.
The companies now under the control of the liquidators are Mainzeal
Group, Mainzeal Property and Construction, Mainzeal Living, 200
Vic, Building Futures Group Holding, Building Futures Group,
Mainzeal Residential, Mainzeal Construction, Mainzeal, Mainzeal
Construction SI, MPC NZ and RGRE.
Mainzeal is estimated to owe NZ$11.3 million to the BNZ, NZ$70
million to unsecured creditors and NZ$5.2 million to employees, NZN
discloses. Subcontractors are among the unsecured creditors, said
NZN.
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S I N G A P O R E
=================
HYFLUX LTD: Clash Over $2 Billion Debt Heats Up
-----------------------------------------------
Bloomberg News reports that Singapore's troubled water treatment
company Hyflux, formerly celebrated as a hallmark of
entrepreneurship in better times, is set for a humbling week.
Creditors are due to file proof by March 1 of the obligations that
Hyflux owes them, putting the company's SGD2.7 billion unsecured
debt load under an even brighter spotlight. Bloomberg says the firm
this month unveiled a proposal to impose 75 to 90 per cent haircuts
on unsecured creditors, following a tumble triggered by an
ill-timed expansion into energy in recent years.
According to Bloomberg, Singapore's debt market has inflicted deep
losses on unsecured creditors since the oil-market slump in late
2013, as a myriad of companies followed shipbuilders and charterers
into distress.
Some Hyflux investors have banked on government help, given that
the company owns the Tuaspring desalination plant deemed crucial to
Singapore's water supply. But those bets may be misplaced, some
observers argue, Bloomberg relays.
"From some of our conversations, many have invested in Hyflux based
on the premise of government backing," Bloomberg quotes Ang Chung
Yuh, a fixed-income analyst at iFast Corp in Singapore, as saying.
"It's a misconception." While the asset is critical, the holding
company isn't, he added.
Bloomberg notes that Hyflux funded its business expansion with
junior debt, some sold through ATMs; it counts some 34,000
mom-and-pop investors among its creditors, and angers abound
There have been petitions to vote against Hyflux's proposal, as
well as calls in private chat groups for state rescue at a time
when general elections are around the corner, Bloomberg relates.
Even before Hyflux's distress, some SGD1.9 billion of local bonds
had fallen into default since late 2015, according to Bloomberg
data.
Bloomberg relates that Hyflux investors, especially holders of
junior debt, are calling for better terms and state intervention,
at least in private chat groups. The government has said in
parliament that it's inappropriate to comment on the Hyflux debt
situation, saying it's "a commercial matter."
According to Bloomberg, the company obtained court protection in
May 2018 to fend off creditors, and brought in a white knight in
October.
Hyflux's key asset is the Tuaspring plant, the largest in Southeast
Asia. The asset is secured against loans from Malayan Banking Bhd,
Bloomberg discloses.
Net debt to Ebitda surged to 165 times in Q1 2018 vs 3.9 times a
year earlier, according to Bloomberg data.
Market capitalization shrank to SGD165 million when shares halted
in May 2018. They were worth SGD2 billion at its peak in 2010.
Hyflux seeks a SGD400 million cash injection from Indonesian
tycoons in exchange for 60 per cent equity, Bloomberg notes.
Bloomberg adds that Hyflux plans to convert debt into 36 per cent
of equity, shared by bank lenders (SGD717 million), medium-term
note holders (SGD278 million), trade claimants (SGD11 million),
contingent claimants (SGD678 million), perpetual securities holders
(SGD500 million) and reference shares holders (SGD400 million).
Shareholders will see their holdings diluted to 4 per cent,
Bloomberg says.
About Hyflux
Singapore-based Hyflux Ltd -- https://www.hyflux.com/ -- provides
various solutions in water and energy areas worldwide. The company
operates through two segments, Municipal and Industrial. The
Municipal segment supplies a range of infrastructure solutions,
including water, power, and waste-to-energy to municipalities and
governments. The Industrial segment supplies infrastructure
solutions for water to industrial customers.
As reported in the Troubled Company Reporter-Asia Pacific on May
24, 2018, Hyflux Ltd. said that the Company and five of its
subsidiaries, namely Hydrochem (S) Pte Ltd, Hyflux Engineering Pte
Ltd, Hyflux Membrane Manufacturing (S) Pte. Ltd., Hyflux Innovation
Centre Pte. Ltd. and Tuaspring Pte. Ltd. have applied to the High
Court of the Republic of Singapore pursuant to Section 211B(1) of
the Singapore Companies Act to commence a court supervised process
to reorganize their liabilities and businesses. The Company said
it is taking this step in order to protect the value of its
businesses while it reorganises its liabilities.
The Company has engaged WongPartnership LLP as legal advisors and
Ernst & Young Solutions LLP as financial advisors in this process.
NAM CHEONG: Swings to MYR6.3MM Q4 Profit After Waiver of Debts
--------------------------------------------------------------
The Strait Times reports that Nam Cheong recorded a net profit of
MYR6.3 million (SGD2.1 million) for the fourth quarter, a major
turnaround from a loss of MYR899.5 million in the year-ago period,
which it credited mainly to the waiver of debts.
Revenue for the three months to Dec 31 rose 39 per cent to MYR99.44
million from MYR71.4 million in the year-ago quarter, the Strait
Times relays. This was driven by a significant increase in vessel
chartering income, which jumped 147 per cent to MYR48.8 million
from MYR19.7 million a year ago after Nam Cheong added seven
vessels to its chartering fleet.
Earnings per share came in at nine Malaysian sen, reversing from a
loss of 42.90 sen in the year-ago period.
For the full year, Nam Cheong saw net profit of MYR959.6 million,
reversing from a net loss of MYR3 billion in FY2017, the Strait
Times discloses.
Revenue for the 2018 financial year increased three per cent to
MYR329.9 million, mainly as a result of the waiver and
extinguishment of debt, said the company, the report relays.
According to the Straits Times, Leong Seng Keat, Nam Cheong's group
chief executive officer, noted an uptick in Malaysia's O&M
activities and said the group has been deploying its vessels for
charter in Malaysia. He expects the vessel chartering segment to
continue its growth momentum.
The company will "continue to monitor and review its shipbuilding
schedule, together with deferment and cancellation plans, for its
remaining vessels which have yet to be delivered, through ongoing
communication and consultation with its stakeholders".
Malaysia-based Nam Cheong Limited operates as a global offshore
marine group. The Company specializes in providing Offshore Support
Vessels(OSVs), as well as owns and operates ship building yards for
OSVs in Malaysia for use in the offshore oil and gas
exploration and production and oil services industries.
*********
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 2019. 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.
*** End of Transmission ***