/raid1/www/Hosts/bankrupt/TCRAP

/raid1/www/Hosts/bankrupt/TCRAP_Public/190419.mbx T R O U B L E D C O M P A N Y R E P O R T E R A S I A P A C I F I C Friday, April 19, 2019, Vol. 22, No. 79 Headlines A U S T R A L I A ANTAEUS DEVELOPMENT: First Creditors' Meeting Set for May 1 CUBE MARKETING: Second Creditors' Meeting Set for April 30 EASTERN GOLDFIELDS: Plan Centred on Davyhurst Processing Plant EXPRESS OFFICE: Second Creditors' Meeting Set for April 26 GROCON CONSTRUCTORS: Two Units Unable to Pay Debts, Dexus Claims HEARING CLINIC: First Creditors' Meeting Set for April 30 LUXTOWN PTY: First Creditors' Meeting Set for April 30 SECONDS WORLD: First Creditors' Meeting Set for April 30 ZAFFERO PTY: Second Creditors' Meeting Set for April 30 C H I N A YIHUA ENTERPRISE: S&P Downgrades ICR to B- on Weakening Liquidity I N D I A BETA WIND: CARE Reaffirms 'D' Rating on INR927.53cr LT Loan CHARTERED HOTELS: CARE Migrates 'D' Rating to Not Cooperating DEESAN COTEX: CARE Lowers Rating on INR12.62cr LT Loan to D INDSUR GLOBAL: CARE Lowers Rating on INR21.49cr LT Loan to D M.P.K. ISPAT: CARE Migrates 'D' Rating to Not Cooperating M.P.K. METALS: CARE Migrates 'D' Rating to Not Cooperating PACIFIC EDUCATION: CARE Reaffirms D Rating on INR3.19cr Loan PV KNIT: CARE Migrates D Rating to Not Cooperating Category RICHLOOK CREATIONS: CARE Downgrades Rating on INR13.81cr Loan to D SAVTRIDEVI INDUSTRIES: CARE Cuts Rating on INR9.53cr Loan to D SHRIYA OVERSEAS: CARE Migrates 'D' Rating to Not Cooperating VBC RENEWABLE: CARE Lowers Rating on INR14.20cr LT Loan to D VISWABHARATHI EDUCATIONAL: CARE Moves D Rating to Not Cooperating WHOLESOME FOODS: CARE Lowers Rating on INR17.86cr Loan to D S I N G A P O R E HYFLUX LTD: PUB Serves 30-Day Notice for Takeover of Tuaspring - - - - - ================= A U S T R A L I A ================= ANTAEUS DEVELOPMENT: First Creditors' Meeting Set for May 1 ----------------------------------------------------------- A first meeting of the creditors in the proceedings of Antaeus Development Pty Ltd will be held on May 1, 2019, at 10:00 a.m. at Level 27, 101 Collins Street, in Melbourne, Victoria. Travis Pullen of B&T Advisory was appointed as administrator of Antaeus Development on April 16, 2019. CUBE MARKETING: Second Creditors' Meeting Set for April 30 ---------------------------------------------------------- A second meeting of creditors in the proceedings of: -- Cube Marketing Pty Ltd; -- Riviara Pty Ltd; -- Monarco Property Management Services Pty Ltd; -- Liberty Property Sales Pty Ltd; -- Monarco Property Management Pty Ltd; and -- Monarco Pty Ltd has been set for April 30, 2019, at 11:00 a.m. at the offices of Nicols + Brien, at Level 2, 350 Kent 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 April 30, 2019, at 11:00 a.m. Steven Nicols of Nicols + Brien was appointed as administrator of Cube Marketing on March 28, 2019. EASTERN GOLDFIELDS: Plan Centred on Davyhurst Processing Plant -------------------------------------------------------------- Peter Milne at The West Australian reports that a new company emerging from the ashes of Michael Fotios' Eastern Goldfields is planning an 18-month exploration campaign it hopes will turn the Davyhurst processing plant near Kalgoorlie into a 120,000oz-a-year production centre. Interim chief executive of Ora Banda Mining, Silver Lake Resources chairman David Quinlivan, on April 14 told WestBusiness his plan to raise up to AUD40 million and exit administration had been backed by major shareholders and people owed money when administrators Ferrier Hodgson took over Eastern Goldfields last year. According to the report, Mr. Quinlivan said a number of creditors had agreed to take equity and some major shareholders would underwrite a portion of the recapitalisation. "It can be successful, by going back to advanced exploration, a resource drill-out to revisit the mine plan and develop a strategy for going forward," the report quotes Mr. Quinlivan as saying. It is understood Hartleys will issue a prospectus within two weeks to raise between AUD30 million and AUD40 million, the report says. The West Australian notes that an 18-month work program estimated to cost AUD21 million is planned to test and verify the resources around the Davyhurst processing plant and develop the mine plan. The West Australian relates that Mr. Quinlivan said the money raised would be enough to pay creditors in accordance with the relevant deed of company arrangement and finish a mine plan to present to the new board. Davyhurst, 120km north-west of Kalgoorlie-Boulder, was reopened by Mr. Fotios in 2017 after a nine-year hiatus, the report discloses. In August, Eastern Goldfields revealed it generated AUD13.9 million in revenue in the first six months of 2018, more than AUD40 million short of the AUD58.3 million it forecast, and had AUD10,000 cash. According to The West Australian, contractor GR Engineering last year reached an AUD8.25 million settlement with Eastern Goldfields over unpaid work on the Davyhurst plant. In November, Eastern Goldfields deferred its annual meeting after a AUD75 million plan to recapitalise the company fell through, the report says. It was believed the parties conducting due diligence could not justify the risk and were concerned about a relatively low proportion of declared reserves within its one million ounce-plus resource base. Mr. Fotios received a AUD51,500 fine in Perth Magistrate's Court for seven Commonwealth tax charges unrelated to Eastern Goldfields. It is understood the Ora Banda Mining board members will be Mr Quinlivan, current director Peter Mansell, Cannings Purple chairman Keith Jones and former Gold One International chairman Mark Wheatley, the report adds. About Eastern Goldfields Based in Balcatta, Australia, Eastern Goldfields Limited operates as a gold exploration and production company. It owns 100% interest in the Davyhurst and the Mt Ida gold projects, which are located to the north-west of Kalgoorlie. It also holds interests in Siberia, Riverina, Callion, Waihi, and LOI projects. The company was formerly known as Swan Gold Mining Limited and changed its name to Eastern Goldfields Limited in December 2015. Andrew Smith and Martin Jones of Ferrier Hodgson were appointed Administrators of the following Companies on Nov. 29, 2018, pursuant to Section 436A of the Corporations Act 2001: - Eastern Goldfields Limited - Monarch Nickel Pty Ltd - Monarch Gold Pty Ltd - Carnegie Gold Pty Ltd - Siberia Mining Corporation Pty Ltd - Mt Ida Gold Operations Pty Ltd - Ida Gold Operations Pty Ltd - Pilbara Metals Pty Ltd - Mt Ida Gold Pty Ltd - Eastern Goldfields Mining Services Pty Ltd - Siberia Gold Operations Pty Ltd EXPRESS OFFICE: Second Creditors' Meeting Set for April 26 ---------------------------------------------------------- A second meeting of creditors in the proceedings of Express Office Systems Pty Ltd, trading as Express Office Supplies, has been set for April 26, 2019, at 3:00 p.m. at the offices of Jirsch Sutherland, at Level 12, 460 Lonsdale Street, in Melbourne. 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 April 24, 2019, at 4:00 p.m. Malcolm Kimbal Howell of Jirsch Sutherland was appointed as administrator of Express Office on March 25, 2019. GROCON CONSTRUCTORS: Two Units Unable to Pay Debts, Dexus Claims ---------------------------------------------------------------- Sarah Danckert at The Sydney Morning Herald reports that major office landlord Dexus has questioned whether two subsidiaries of construction giant Grocon can pay debts allegedly owed to Dexus, a court has heard. The sensational allegation was aired in the Federal Court on April 15 as part of a wider debt dispute between the Dexus group and Grocon Constructors (VIC) and Grocon Constructors (QLD), SMH says. According to SMH, the Grocon subsidiaries took Dexus to court in February after the landlord sent the entities statutory demand notices for millions of dollars in alleged debts. SMH relates that the court stoush is another blow for the group that in recent years has built the Commonwealth Games Village on the Gold Coast and is presently developing several projects including an office tower in Sydney's Darling Harbour known as The Ribbon and the AUD2 billion shopping centre and office development at Barangaroo Central on Sydney Harbour. Concerns about Grocon's fortunes have been brewing in recent years after it emerged the company had sought alternative funding arrangements, including high interest mezzanine financing, after over-extending itself on two major projects in Queensland, the report states. Separately, Grocon Constructors (QLD) was fined AUD27,000 in 2018 for its alleged late payment of subcontractors to its AUD650 million Commonwealth Games Village project on the Gold Coast, SMH discloses. The subcontractors had all been paid when the fine was issued. Grocon Constructors (QLD) also had its building licence cancelled in late 2018 for allegedly failing to satisfy financial requirements. Operating entity, Grocon Group Holdings posted a AUD27.5 million loss for the year to June 30, 2017, SMH discloses citing accounts filed in February 2018. The group also had AUD32 million in cash at that time. The accounts also show Grocon and its auditors expressing concern about the company's ability to continue as a going concern. Separate accounts for key subsidiary Grocon Constructors showed it reported a AUD77 million loss over the same period. More recent accounts for both public reporting entities are not yet available. SMH says Dexus and Grocon have been locked in an out-of-court legal battle for months regarding a dispute relating to payments Dexus alleges are due on an entity it manages, the Dexus 480Q Trust. The dispute is thought to relate to many millions of dollars allegedly relating to overdue payments on the 480 Queen Street development in Brisbane. Dexus and its wholesale property fund purchased the tower from Grocon in 2013 on a fund through basis while it was under development. According to Dexus's half year accounts, the building is worth AUD775 million. Property industry sources doubted Grocon was not able to pay the debt but was yet to do so because it disagreed with the amount claimed by Dexus, according to SMH. Counsel for Grocon's subsidiaries, Sam Rosewarne, told the court on April 15 that Dexus chief legal officer Brett Cameron made the allegation that the two Grocon subsidiaries were unable to pay their debts in an affidavit filed in the matter. "The opinion is the company is unable to pay its debts," the report quotes Mr. Rosewarne as saying. SMH says Grocon is seeking to have the allegation struck out of Mr. Cameron's affidavit arguing the inclusion of the allegation is legally improper and also untrue. According to the report, Mr. Rosewarne told the court the inclusion of the opinion by Mr. Cameron was improperly included in the affidavit because it was drawn from "without prejudice" discussions between Dexus and Grocon's subsidiaries. Dexus is seeking an exemption from the usual rules regarding these sorts of private discussions between parties, with its barrister Stewart Maiden, QC, telling the court "we have not breached that privilege," SMH relays. The hearing continues, SMH notes. In regards to when Grocon's 2018 accounts would be filed, the spokeswoman said the accounts would be filed in due course, "it's business as usual", she said, SMH relays. Grocon Pty Ltd is a development, construction and funds management company. HEARING CLINIC: First Creditors' Meeting Set for April 30 --------------------------------------------------------- A first meeting of the creditors in the proceedings of The Hearing Clinic Australia Pty Ltd will be held on April 30, 2019, at 12:00 p.m. at Ground Floor, 197 St Georges Terrace, in Perth, WA. Thyge Trafford-Jones and Domenico Alessandro Calabretta of Mackay Goodwin were appointed as administrators of Hearing Clinic on April 15, 2019. LUXTOWN PTY: First Creditors' Meeting Set for April 30 ------------------------------------------------------ A first meeting of the creditors in the proceedings of Luxtown Pty Ltd, trading as 2nds World, will be held on April 30, 2019, at 2:00 p.m. at Wesley Conference Centre, at the Lyceum, 220 Pitt Street, in Sydney, NSW. Riad Tayeh, Mark Robinson, and Antony Resnick of de Vries Tayeh were appointed as administrators of Luxtown Pty on April 15, 2019. SECONDS WORLD: First Creditors' Meeting Set for April 30 -------------------------------------------------------- A first meeting of the creditors in the proceedings of Seconds World Trading Pty Limited ATF The Cremorne Property Trust will be held on April 30, 2019, at 2:00 p.m. at The Lyceum, Wesley Conference Centre, 220 Pitt Street, in Sydney, NSW. Riad Tayeh, Mark Robinson, and Antony Resnick of de Vries Tayeh were appointed as administrators of Seconds World on April 15, 2019. ZAFFERO PTY: Second Creditors' Meeting Set for April 30 ------------------------------------------------------- A second meeting of creditors in the proceedings of Zaffero Pty Ltd has been set for April 30, 2019, at 11:00 a.m. at the offices of DW Advisory, Level 2, 32 Martin Place, 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 April 29, 2019, at 5:00 p.m. Anthony Elkerton of DW Advisory was appointed as administrator of Zaffero Pty on Jan. 17, 2019. ========= C H I N A ========= YIHUA ENTERPRISE: S&P Downgrades ICR to B- on Weakening Liquidity ----------------------------------------------------------------- On April 17, 2019, S&P Global Ratings lowered its long-term issuer credit rating on Yihua Enterprise (Group) Co. Ltd. (Yihua) to 'B-' from 'B'. S&P also lowered the issue-level rating on the company to 'CCC+' from 'B-'. The downgrade is based on Yihua's weakened liquidity with sizable debt maturities in 2019 and 2020, only moderate amount of cash on its balance sheet, and a challenging refinancing environment for privately held companies in China. Yihua's liquidity is strained. In 2019, the company faces Chinese renminbi (RMB) 4 billion maturities (RMB2.3 billion of straight maturity and RMB1.7 billion in puttable bonds). In 2020, debt maturities are RMB6.3 billion, including RMB4.8 billion in straight bonds and RMB1.5 billion in puttable bonds. S&P believes that Yihua could handle the 2019 maturities with a combination of cash on hand, timely cash collection from property projects, and potential divestiture of its large liquid equity investments. However, the company will be dependent on the capital market to extend and refinance its 2020 maturities. Since mid-2018, private-owned enterprises in general have had difficulty obtaining liquidity from banks and longer-term capital from the debt market. Yihua is no exception. In 2018, the company increasingly relied on short-term debt issuances to refinance maturities and fund its aggressive acquisitions in healthcare services. With limited access to long-term funding, the company's capital structure weakened and added to its maturity wall in 2019 and 2020. Yihua has only issued RMB1.4 billion in bonds since Sept. 30, 2018, to repay RMB981 million in early redemption puttable bonds. The RMB400 million balance from the issuance was insufficient to extend its 2019 maturities. Yihua's large portfolio of liquid equity investments and plans to introduce strategic investors in its healthcare business could provide some support to liquidity. As of March 25, 2019, the portfolio is valued at RMB3.3 billion. Although the portfolio could convert to cash with a minor discount (about 3%-5%), S&P does not expect the company to view the portfolio as a primary source of liquidity. The portfolio consists mainly of A-shares listed consumer and technology firms. Yihua's slower-than-expected cash collection of proceeds from Poly Real Estate Group Co. Ltd. added to its current liquidity pressure. The cash received from the four property projects in 2018 were about RMB900 million, far lower than the RMB2 billion-RMB3 billion that we originally forecasted as some projects progressed slower. S&P said, "We deem the probability of collecting the remaining project cash to be high but foresee some uncertainty in timing over the next 12-24 months. The timing depends on the projects obtaining construction permits and construction loans from banks. Now that 51% equity transfer of all four projects has been completed, we think both Poly and Yihua have strong incentives to speed up the process. Under our base case, we estimate that Yihua will receive RMB1.5 billion-RMB2.0 billion of cash from Poly in 2019 and RMB2.0 billion-RMB2.3 billion in 2020. Our assumptions do not include sharing of cash flows from future contract sales of the four projects, given that both the amount and timing are uncertain. "We see meaningful execution risks in the refinancing plan especially regarding repayment of the sizable maturities in 2020." Yihua still has several levers it could pull to meet the payment, including cash injections from strategic investors, potential mortgage financing from banks, and profit sharing from real estate projects. However, the visibility of these options is still limited and the total estimated amount is not significant enough to repay the RMB6.3 billion coming due. The company's ability to refinance hinges upon successful execution of all the plans above as well as access to the capital market. Yihua's market access may have weakened with the recent stock exchange enquiry. In March 2019, Yihua Healthcare received an enquiry from the Shenzhen Stock Exchange into potential stock manipulation by a company insider. The company has responded denying the allegation and received no penalty, yet the incident could have a negative effect on the company's refinancing efforts. This could further limit its access to funds and add to its liquidity pressure. S&P said, "We expect free operating cash flow to turn positive in the coming 12-24 months as Yihua curbs capital expenditure and new acquisitions, given its tight liquidity. We forecast improving operating cash flow and working capital, given construction of most self-owned property is complete and the divestment of the property business is ongoing. Yihua will likely remain highly leveraged with a heavy reliance on refinancing. Its debt-to-EBITDA ratio may worsen to 8.0x-9.0x in 2018 before deleveraging to 7.0x-7.5x in 2019. We also expect Yihua's EBITDA to interest coverage to slightly weaken to 1.8x-2.1x in 2018 and 2019 from 2.5x in 2017." The negative outlook reflects a potential for another one-notch downgrade if Yihua's access to the capital market further weakens or cash collection progresses slower than expected, which would exacerbate the liquidity and refinancing pressure facing the company. S&P said, "We could lower the rating in 12 months if Yihua's liquidity further worsens due to further delay in the cash collection from real estate business or equity injection from strategic investors. "We could revise the outlook to stable if Yihua's market access is reestablished or visibility to the cash inflow improves such that the plan for refinancing their debt maturities in 2019 and 2020 become credible and feasible." ========= I N D I A ========= BETA WIND: CARE Reaffirms 'D' Rating on INR927.53cr LT Loan ----------------------------------------------------------- CARE Ratings reaffirmed ratings on certain bank facilities of Beta Wind Farm Private Limited (BWF), as: Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long-term Bank 927.53 CARE D Reaffirmed Facilities Detailed Rationale & Key Rating Drivers The rating assigned to the bank facilities of BWF takes into account the instances of delays in servicing debt obligations. Detailed description of the key rating drivers Key Rating Weaknesses Instances of delays in debt servicing: The Company has reported delays in debt servicing to banks on account of tight liquidity position, arising mainly due to longer time taken for realisation of receivables from AP Discom. During FY18 (refers to the period April 1 to March 31), the company generated total income of INR255 crore as against INR268 crore during FY17. The company reported PAT of INR3.3 crore in FY18 as against PAT of INR10.3 crore in FY17. The wind assets operated at an average PLF of 23.2% in FY18 Similar to the levels of FY17. During 11mFY19 the average PLF was 23.8%. The Company has receivables of INR50.69 crore as on March 31, 2018. Also, the company has REC income receivable and Generation Based Incentive (GBI) income receivable. Key rating strengths Established presence of OGPL in renewable energy segment: BWF is a subsidiary of OGPL. OGPL's promoter is SVL Limited (formerly known as Shriram Industrial Holdings Limited) which is the controlling company of the non-financial services segment of Shriram Group which has significant presence in the financial services industry. BWF has been supported by the group companies in terms of funding requirements. BWF is a board managed company. All the directors are professionals with significant industry experience and management expertise in the power industry. Beta Wind Farm Private Ltd. (BWF), a project SPV company was incorporated for setting up of wind farm under the Group Captive Power Plant Policy in the state of Tamil Nadu. The company has subsequently expanded to other states namely, Gujarat, Karnataka and Andhra Pradesh. BWF is a subsidiary of Orient Green Power Company Limited (OGPL) which is holding 74% stake and the remaining 26% held by various group captive consumers. The company sells power generated, to discoms like Andhra Pradesh discom (Central power distribution company of Andhra Pradesh Limited) and Gujarat discom (Gujarat Urja Vikas Vikas Nigam Limited) etc. and to other group captive customers. The company's wind assets currently aggregate to 242 MW. CHARTERED HOTELS: CARE Migrates 'D' Rating to Not Cooperating ------------------------------------------------------------- CARE Ratings has migrated the rating on bank facilities of Chartered Hotels Pvt. Ltd. (CHPL) to Issuer Not Cooperating category. Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long-term Bank 40.11 CARE D; Issuer not cooperating; Facilities Based on best available (TL-Axis Bank) Information Long-term Bank 287.41 CARE D; Issuer not cooperating; Facilities (TL) Based on best available Information Short-term Bank 26.00 CARE A4; Issuer not cooperating; Facilities (BG) Based on best available information Detailed Rationale& Key Rating Drivers CARE has been seeking information from CHPL to monitor the rating(s) vide e-mail communications dated February 19, 2019, February 25, 2019, March 5, 2019 and numerous phone calls. However, despite CARE's repeated requests, the company has not provided the requisite information for monitoring the ratings. In line with the extant SEBI guidelines, CARE has reviewed the rating on the basis of the best available information which however, in CARE's opinion is not sufficient to arrive at a fair rating. The rating on CHPL's bank facilities will now be denoted as CARE D; ISSUER NOT COOPERATING/ CARE A4; ISSUER NOT COOPERATING. Users of this rating (including investors, lenders and the public at large) are hence requested to exercise caution while using the above rating(s). The ratings take into account the ongoing delays in debt serving of the company due to weak revenue generation and inadequate cash flows from operations. However, there have been no delays in bank guarantees. Detailed description of the key rating drivers At the time of last rating on January 11, 2018, the following were the rating strengths and weaknesses: Key Rating Weakness Delays in Debt servicing: Delays in interest repayment of term loan on account of delay in financial closure of additional loans towards the Luknow project due to change in scope of the project. Chartered Hotels Private Limited (CHPL), incorporated in 1996, subsidiary of Saraf Hotels Limited (SHL). CHPL and SHL are part of the Saraf Hotel Enterprises that has over 30 years of experience in hotel, tourism and travel industry and over 22 years of experience in Indian hospitality market. CHPL plans to tap the mid-market segment / full service segment for business by setting up 4 star and 5 star hotels in tier-2 cities - Raipur (4 star), Hampi (4 star), Lucknow (5 star) & Guwahati. DEESAN COTEX: CARE Lowers Rating on INR12.62cr LT Loan to D ----------------------------------------------------------- CARE Ratings revised the ratings on certain bank facilities of Deesan Cotex Private Limited (DCPL), as: Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long-term Bank 12.62 CARE D Revised from CARE B; Facilities Stable Short-term Bank 1.00 CARE D Revised from CARE A4 Facilities Detailed Rationale & Key Rating Drivers The revision in the ratings assigned to the bank facilities of DCPL takes into account of delays in debt servicing and overdraws in working capital limits owing to weak liquidity position. The rating derives strength from the experience of the promoters and their financial support in the past and operational support from group entities with presence across textile value chain. Ability of DCPL to improve the debt servicing track record is the key rating sensitivities. Detailed description of Key rating drivers Key Rating Weaknesses Delay in debt servicing: There have been delays in interest and principal repayments of 30 to 60 days and instances of overutilization up to 30 to 60 days in its fund-based limits on account of on account of a stretched liquidity position due to significantly decline in sales realization with respect to previous year the company suffers net losses amounting to INR2.12 crore in FY18 (vis-à-vis net profit of INR0.03 crore in FY17). Working capital intensive operations along with stretched liquidity position: The operations of the entity remained working capital intensive FY18 in nature on account of deterioration in collection days and creditors period which results into higher working capital utilization for past twelve months ending February 2019. The collection days have deteriorated in FY18 on account of stringent policy followed by the management and there have been delays in receiving the payment from clients. The liquidity position of the company remained has weak marked by current ratio and quick ratio of 0.78x times and 0.56x times respectively as on March 31, 2018. Further the investment in net working capital as a percentage of total capital employed stood at 36.03% as on March 31, 2018 whereas the net cash flow from operating activity stood positive during FY18, the unencumbered cash & bank balance was around INR0.79 crore as on March 31, 2018 as well. Key Rating Strengths Experienced management and support from group entities: DCPL's promoters have experience of over more than fifteen years in the textile industry. Furthermore, DCPL is a part of Deesan group which has been in textile business since 1996 and having several companies operating under it and has presence in all segments of cotton textile starting from cultivation of cotton to manufacturing of garments. DCPL receives operational support from the other group companies in terms of procurement of materials and building customers. Incorporated in 2007, Deesan Cotex Private Limited (DCPL) is engaged in manufacturing and processing of terry towels, trading of grey fabric and job work of yarn doubling. Company procures woven fabric from domestic suppliers and exports finished towel. DCPL has its plants located at Dhaiwad, Dhule, Maharashtra with an installed capacity of 15 tonnes per day for terry towel. DCPL's plant is established under the “Group Work Shed Scheme” (Scheme of Integrated Textile Park (SITP) of Ministry of Textile, the Government of India GWSS consist of Several SSI unit within it out which around 15 SSI units having installed capacity of 24 looms with capacity to manufacture around 6.38 million meter of terry towels will provide job work services (viz. weaving, warping and sizing of terry towels) only to DCPL. DCPL is a part of Dessan group which has been in business of textile since 1996 and having several companies operating under it and has presence in all segments of cotton textile starting from cultivation of cotton to manufacturing of garments. DCPL receives operational support from the other group companies in terms of procurement of materials and building customers. INDSUR GLOBAL: CARE Lowers Rating on INR21.49cr LT Loan to D ------------------------------------------------------------ CARE Ratings revised the ratings on certain bank facilities of Indsur Global Limited (IGL), as: Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long-term Bank 21.49 CARE D; ISSUER NOT COOPERATING; Facilities Rating revised from CARE BB+; Stable Long/Short-term 23.50 CARE D; ISSUER NOT COOPERATING; Bank Facilities Rating revised from CARE BB+; Stable/CARE A4 Detailed Rationale & Key Rating Drivers CARE has been seeking information from IGL to monitor the ratings vide e-mail communications/letters dated January 7, 2019, January 9, 2019, January 31, 2019, February 18, 2019, March 20, 2019 and numerous phone calls. However, despite CARE's repeated requests, the firm has not provided the requisite information for monitoring the ratings. In line with the extant SEBI guidelines, CARE has reviewed the rating on the basis of the publicly available information which however, in CARE's opinion is not sufficient to arrive at a fair rating. The rating on Indsur Global Limited's bank facilities will now be denoted as CARE D; ISSUER NOT COOPERATING. Users of this rating (including investors, lenders and the public at large) are hence requested to exercise caution while using the above rating(s). Detailed description of the key rating drivers At the time of last rating on February 05, 2018, the following were the rating strengths and weaknesses (updated for the information available from MCA website and banker feedback). Key rating Weakness Delay in servicing debt obligation: As per banker interaction, there are ongoing delays in serving of debt obligation and the account is classified as NPA. Decline in scale of operations: During FY18, total operating income of IGL remained at INR 59.11 crore as compared to INR 75.93 crore in FY17. Overall scale of operations continues to remain at modest level. Losses incurred in FY18: IGL incurred operating loss of INR 1.04 crore in FY18 vis-a-vis operating profit of INR 11.05 crore. Further, with the losses at PBILDT level company incurred net loss of INR 10.86 crore in FY18 vis-a-vis INR Net profit INR 0.05 crore in FY17. Deterioration in capital structure and debt coverage indicators: IGL's overall gearing deteriorated to 4.00x as on March 31, 2018 (vis-a-vis 2.07x as on March 31, 2017) due deterioration in net worth base due to losses incurred in FY18. Further debt coverage indicators are marked by deterioration in total debt to GCA and interest coverage ratio due to losses incurred along with negative gross cash accruals in FY18. Elongation in working capital cycle: During FY18, working capital cycle elongated to 2014 days from 162 days in FY17 on account of stretched collection period and inventory days as on March 31, 2018. Weak liquidity position: Liquidity position is marked by current ratio remained at 1.34x in FY18 vis-a-vis 1.38x in FY17. Further cash and bank balance also declined to INR 0.01 crore in FY18 vis-a-vis INR 0.08 crore in FY17. Customer concentration risk: During FY17, the top 5 customers of IGL contributed ~79% of its total sales (vis-a-vis ~85% in FY16) and out of top 5 customers, top 2 continued to contribute more than 60% to the total sales in FY17 therefore concentration risk remains in the business. However the company's revenues are not confined to single location and are spread across domestic and overseas countries such as USA, Germany, Slovakia and UAE. Furthermore some comfort can be drawn from the fact that IGL has long standing business relation with established players in the insulator industry. Further delay in project execution: IGL is undergoing with capacity expansion and modernization of its existing plant located in Halol, Gujarat. The project is expected to complete by April 2018 as against earlier envisaged date of December 2017. The delay was due to delay in banking procedures. As on January 2018, ~90% of the project is completed and cost is being funded through term loan and through unsecured loan from promoters and relatives. Ability of the company to timely complete the project and effectively utilize its enhanced capacity and thereby improve its profit margins on account of operational efficiency shall be critical from credit perspective. Exposure to raw material price volatility and foreign exchange rate fluctuation: Purchase of raw material has been the major component in cost structure which contributed ~80% in FY18 (vis-a-vis 70% in FY17) and raw material required for manufacturing process is cold rolled coil (CRC), steel scrap, etc. the prices of which have shown fluctuations during the past years due to volatility in the global commodity markets. However, the company sources its entire raw material requirement from the domestic markets (i.e. Gujarat) and due to its long standing business relations with its key customers; it has so far been able to pass on increase in raw material prices to its customers to a large extent. Further IGL earns approximately 20% (as against 23% in FY16) of its revenues from exports which is entirely un-hedged thereby leading to the risk of exchange rate fluctuation. However, the company imports of raw material CRP scrap from Brazil which provides natural hedging to an extent. Key Rating Strengths Experienced management and their financial support in the past: IGL (part of Indsur group-engaged in manufacturing of iron & steel casting through various ventures) with a presence of around two decades; is entirely operated and managed by the Lodha family since 2004. The key promoters of the company are professional and well experienced with Mr. Sureshmal Lodha (having four decades of experience) and Mr. Amit Lodha (a CA, CPA with more than a decade of experience) along with Mr. Ankur Lodha (an MBA with more than a decade of experience) who took over the loss making business from Aditya Birla group and has been instrumental in transforming the business. The promoters are well supported by the experienced and qualified management personnel. Moreover, the promoters have been supporting the entity through infusion of funds in the past. Various quality certifications: IGL has continuously undertaken expansion, modernization and automation of its plant during past four years and has developed well-structured manufacturing facilities with quality management system as it is an ISO 16949:2009 and 9001:2008 certified unit. The company has also received ISO 14001:2004 certification for sound environmental management system with regards to manufacturing of SG and CI castings for engineering and automotive applications. Incorporated in 1994, Indsur Global Limited (IGL) [formerly known as HGI Foundries – unit of Aditya Birla group located in Halol, Gujarat] is a closely held company taken over by Indsur group in the year 2004. Currently, the company is engaged in the business of manufacturing of insulator and auto castings, with insulator castings contributing about 98% of the revenues during FY17 (as against 99% in FY16). IGL presently has installed capacity of 12,000 Metric Tons Per Annum (MTPA). Further the entity is undertaking an expansion and modernization plan which is expected to be completed by January 2017 and after which the installed capacity would increase to 20,000 MTPA. The company generates majority of its revenue from the domestic market and exports formed approximately 20% of the revenue base (during FY17) mainly to USA and Germany. M.P.K. ISPAT: CARE Migrates 'D' Rating to Not Cooperating --------------------------------------------------------- CARE Ratings has migrated the rating on bank facilities of M.P.K. Ispat (I) Private Limited (MPKI) to Issuer Not Cooperating category. Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long-term Bank 19.30 CARE D; Issuer not cooperating; Facilities Based on best available Information Short-term Bank 7.40 CARE D; Issuer not cooperating; Facilities Based on best available Information Detailed Rationale & Key Rating Drivers CARE has been seeking information from MPKI to monitor the rating vide e-mail communications/letters dated March 11, 2019, March 12, 2019, March 13, 2019 and numerous phone calls. However, despite CARE's repeated requests, the company has not provided the requisite information for monitoring the ratings. In line with the extant SEBI guidelines, CARE has reviewed the rating on the basis of the publicly available information which however, in CARE's opinion is not sufficient to arrive at a fair rating. Further, MPKI has not paid the surveillance fees for the rating exercise as agreed to in its Rating Agreement. The rating on MPKI's bank facilities will now be denoted as CARE D; ISSUER NOT COOPERATING; based on best available information. Users of this rating (including investors, lenders and the public at large) are hence requested to exercise caution while using the above rating. The rating assigned to the bank facilities of MPKI continues to remain constrained on account of ongoing delays in servicing of interest and installment of its debt owing to stressed liquidity position. Detailed description of the key rating drivers At the time of last rating on November 30, 2016, the following were the rating strengths and weaknesses: Key Rating Weakness Delays in debt servicing: The account is NPA. Incorporated in 2010, M.P.K Ispat India Private Limited (MPKI) is promoted by the MPK group based out of Jaipur (Rajasthan). As a backward integration initiative, MPK group set up Mild Steel (MS) billet manufacturing plant in MPKL with commencement of operations from March, 2013 onwards thus by translating to FY14 being the first full year of operation for the company. MPKI has its manufacturing unit situated at Bagru, Rajasthan, having installed capacity of 27,000 Metric Tonnes Per Annum (MTPA) as on March 31, 2016. The company majorly supplies its production of M.S. Billets to its group concerns which are engaged in the manufacturing of structural steel products as well as cater to the domestic market. It meets its raw material requirement mainly by purchase from local market as well as import from outside market. M.P.K. METALS: CARE Migrates 'D' Rating to Not Cooperating ---------------------------------------------------------- CARE Ratings has migrated the rating on bank facilities of M.P.K. Metals Private Limited (MPKM) to Issuer Not Cooperating category. Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long-term Bank 6.41 CARE D; Issuer not cooperating; Facilities Based on best available Information Short-term bank 0.72 CARE D; Issuer not cooperating; Facilities Based on best available Information Detailed Rationale & Key Rating Drivers CARE has been seeking information from MPKM to monitor the rating vide e-mail communications/letters dated March 11, 2019, March 12, 2019, March 13, 2019 and numerous phone calls. However, despite CARE's repeated requests, the company has not provided the requisite information for monitoring the ratings. In line with the extant SEBI guidelines, CARE has reviewed the rating on the basis of the publicly available information which however, in CARE's opinion is not sufficient to arrive at a fair rating. Further, MPKM has not paid the surveillance fees for the rating exercise as agreed to in its Rating Agreement. The rating on MPKM's bank facilities will now be denoted as CARE D; ISSUER NOT COOPERATING; based on best available information. Users of this rating (including investors, lenders and the public at large) are hence requested to exercise caution while using the above rating. The rating assigned to the bank facilities of M.P.K. Metals Private Limited (MPKM) continues to remain constrained on account of ongoing delays in servicing of interest and installment of its debt owing to stressed liquidity position. Detailed description of the key rating drivers At the time of last rating on July 12, 2017 the following were the rating strengths and weaknesses (updated for the information available from Registrar of Companies): Incorporated in 2009, M.P.K Metals Private Limited (MPKM) is promoted by MPK group based out of Jaipur (Rajasthan). MPKM is primarily engaged into the business of manufacturing of structural products includingMild Steel (M S) angles, sections, rounds and flats which finds its application particularly in infrastructure industries ranging from power transmission to real estate. MPKM has its manufacturing unit situated at Jaipur, Rajasthan, having installed capacity of 4,800 Metric Tonnes Per Annum (MTPA) as on March 31, 2016. PACIFIC EDUCATION: CARE Reaffirms D Rating on INR3.19cr Loan ------------------------------------------------------------ CARE Ratings reaffirmed ratings on certain bank facilities of Pacific Education Trust (PET), as: Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long-term Bank 3.19 CARE D Reaffirmed Facilities The rating assigned to one of the term loan facilities is being withdrawn as the same has been liquidated. Detailed Rationale & Key Rating Drivers The rating assigned to the bank facilities of PET continues to factor in ongoing delays in servicing of debt obligations on account of stressed liquidity position. Detailed description of the key rating drivers Key Rating Weakness Ongoing delays in debt servicing: As informed by the banker, there are on-going delays in servicing of debt obligations due to stressed liquidity position. Ahmedabad based PET was set up by the Pacific Group of Udaipur (Rajasthan) on July 22, 2010 to impart education in the field of engineering. The trust is managed by Mrs Leela Devi Agarwal (Chairman) and Mr Rahul Agarwal (Vice-chairman) having experience of more than a decade in managing various educational institutions. PET provides education in the field of engineering through 'Pacific School of Engineering, Surat (PSE) from the Academic Year (AY) 2012-13. PSE offers degree courses in Civil, Mechanical, Electrical, Chemical and Computer Science while it also offers diploma course in Mechanical, Civil and Electrical engineering. PSE is accredited by All India Council for Technical Education (AICTE) and is affiliated to Gujarat Technological University (GTU). PV KNIT: CARE Migrates D Rating to Not Cooperating Category ----------------------------------------------------------- CARE Ratings has migrated the rating on bank facilities of PV Knit Fashions (PVF) to Issuer Not Cooperating category. Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long-term Bank 5.60 CARE D Issuer Not Cooperating; Facilities Based on best available Information Short-term Bank 3.15 CARE D Issuer Not Cooperating; Facilities Based on best available Information Detailed Rationale & Key Rating Drivers CARE has been seeking information from PVF to monitor the rating vide e-mail communications/letters dated March 4, 2019, March 5, 2019, March 6, 2019 & March 7, 2019 and numerous phone calls. However, despite CARE's repeated requests, the firm has not provided the requisite information for monitoring the rating. In line with the extant SEBI guidelines, CARE has reviewed the rating on the basis of best available information which however, in CARE's opinion is not sufficient to arrive at fair rating. The rating on PV Knit Fashion's bank facilities will now be denoted as CARE D; Stable/CARE D; ISSUER NOT COOPERATING. Users of this rating (including investors, lenders and the public at large) are hence requested to exercise caution while using the above rating. Detailed description of the key rating drivers At the time of last rating on December 4, 2018 the following were the rating strengths and weaknesses: Key Rating Weakness Ongoing delays in meeting of debt obligations: PV Knit Fashions has been facing liquidity issues due to which the firm is unable to service the interest and principle obligation on term loan facilities as well as occasional packing Credit overdues. There are ongoing delays in serving the interest and installment in term loan facility. PV Knit Fashion (PKF) was established in January, 1989 as a partnership firm by Mr. C. Kumarasamy, Mr. N. Ramasamy and Ms. C. K. Meera. However in the year 2015 the partners Mr. C. Kumarasamy &Ms. C. K. Meera retired and partnership continued by Mr. N. Ramasamy as a Managing partner and incoming partner Ms. R. Vallinayaki. PKF is engaged in manufacturing and exporting of readymade garments and Knits for ladies, men's wear and kids wear. Their products ranges from T. shirts, Polo shirts for men, Sweat shirts, Night wears, and Knits for women and Men, Tracks, Shorts, Skirts, Trouser etc. PKF derives itsstrength from their in-house designing, knitting, dyeing, embroidering, printing, cutting, sewing and finishing and by being acquainted with latest manufacturing technology. PKF is engaged into order based manufacturing and generates over 99% of its total income by exporting their products to traders based in Sweden, France, Belgium and Switzerland. Sweden and France contributes to about 80% of overall export revenue while rest contributesto around 20%. The firm has an installed capacity of 1.25 lakh pieces of garments per annum.PKF has a group concern, M/s P.M.V Dyeing Mills which is engaged in dyeing and printing of cotton fabrics. PKF is supported by their group concern which also provides them the required visibility. RICHLOOK CREATIONS: CARE Downgrades Rating on INR13.81cr Loan to D ------------------------------------------------------------------ CARE Ratings revised the ratings on certain bank facilities of Richlook Creations Private Limited (RCPL), as: Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long term Bank 6.31 CARE D; Issuer not cooperating; Facilities Revised from CARE BB-; Stable On the basis on best available information Long-term/Short- 7.50 CARE D; Issuer not cooperating; Term Bank Revised from CARE BB-; Stable/ Facilities CARE A4 On the basis of best Available Information Detailed Rationale & Key Rating Drivers CARE has been seeking information from RCPL to monitor the rating(s) vide e-mail communications/letters dated November 13, 2018, November 20, 2018, December 4, 2018, January 3, 2019, February 13, 2019, March 8, 2019 and numerous phone calls. However, despite CARE's repeated requests, the Company has not provided the requisite information for monitoring the ratings. In line with the extant SEBI guidelines, CARE has reviewed the ratings on the basis of the publicly available information which however, in CARE's opinion is not sufficient to arrive at a fair rating. In line with the extant SEBI guidelines CARE's ratings on RCPL's bank facilities will now be denoted as CARE D; ISSUER NOT COOPERATING. Users of this rating (including investors, lenders and the public at large) are hence requested to exercise caution while using the above rating(s). The ratings have been revised on account of the delays in debt repayments owing to weak liquidity position. Detailed description of the key rating drivers Key Rating Weaknesses Ongoing delay in debt servicing: There are ongoing delays in servicing debt obligation due to weak liquidity position of RCPL. Surat-based (Gujarat), RCPL is a private limited company incorporated in 2007 by Mr. Rajratan Goyal and Ms. Charu Goual. The company is engaged into the business of manufacturing of grey fabric for garments such as sarees, dress materials and embroidery job work on sarees and dress materials. The manufacturing plant is located at Surat which is a textile hub of India with an installed capacity of 6000 meter per day as on March 31, 2017. The products processed and manufactured by the company are used in the textile industry. SAVTRIDEVI INDUSTRIES: CARE Cuts Rating on INR9.53cr Loan to D -------------------------------------------------------------- CARE Ratings revised the ratings on certain bank facilities of Savtridevi Industries Limited (SIL), as: Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long term Bank 9.53 CARE D; Issuer not cooperating; Facilities Revised from CARE B; Stable on the basis of best available information Detailed Rationale & Key Rating Drivers CARE has been seeking information from SIL to monitor the rating vide e-mail communications/letters dated October 4, 2018, January 19, 2019, February 8, 2019 and February 25, 2019 and numerous phone calls. However, despite CARE's repeated requests, the company has not provided the requisite information for monitoring the rating. In line with the extant SEBI guidelines, CARE has reviewed the rating on the basis of the best available information which however, in CARE's opinion is not sufficient to arrive at a fair rating. The rating on SIL's bank facility will now be denoted as CARE D, ISSUER NOT COOPERATING. Users of this rating (including investors, lenders and the public at large) are hence requested to exercise caution while using the above rating. The revision in the rating assigned to the bank facilities of SIPL factors in the ongoing delays in servicing of debt obligations. Detailed description of the key rating drivers Key Rating Weaknesses Delay in debt servicing obligations: As per banker interaction there are ongoing delays in repayment of term loan and overdrawls in cash credit facility and the account has been classified as NPA. SIL was incorporated in October 2009 as Savitridevi Cotton and Oil Limited. During December 2013, the name of company was changed to SIL. SIL is currently engaged in ginning and pressing of cotton, extraction of oil from cotton seed and trading of milk. The ginning & pressing plant and oil extraction unit is located at Atpadi, Sangli (Maharashtra) with an installed capacity of 73,000 bales per annum and to extract 2,628 mettic tones of cotton seed oil per annum. SHRIYA OVERSEAS: CARE Migrates 'D' Rating to Not Cooperating ------------------------------------------------------------ CARE Ratings has migrated the rating on bank facilities of Shriya Overseas Private Limited (SOPL) to Issuer Not Cooperating category. Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long-term Bank 10.00 CARE D; Issuer not cooperating; Facilities Based on best available Information Short term bank 12.50 CARE D; Issuer not cooperating; facilities Based on best available Information Detailed Rationale & Key Rating Drivers CARE has been seeking information from SOPL to monitor the rating vide e-mail communications/letters dated December 10, 2018, January 3, 2019, January 10, 2019, February 19, 2019, March 4, 2019 and numerous phone calls. However, despite CARE's repeated requests, the company has not provided the requisite information for monitoring the ratings. In line with the extant SEBI guidelines, CARE has reviewed the ratings on the basis of the available information which however, in CARE's opinion is not sufficient to arrive at a fair rating. The rating on SOPL's bank facilities will now be denoted as CARE D; ISSUER NOT COOPERATING/CARE D; ISSUER NOT COOPERATING. Users of this rating (including investors, lenders and the public at large) are hence requested to exercise caution while using the above ratings. The ratings assigned to the bank facilities of SOPL take into account ongoing delays in servicing of debt obligations on account of stretched liquidity position. Detailed description of the key rating drivers At the time of last rating on March 29, 2018 the following were the rating strengths and weaknesses (updated for the information available from Registrar of Companies). Key Rating Weakness Ongoing delays in debt servicing: As per interaction with the bankers there are ongoing delays in debt servicing by the company. Shriya Overseas Private Limited (SOPL) was incorporated in May 1991 by Mr. P. K. Jain and Mr. Bhagat Ram Goyal having its registered office in Delhi. In 1997, there was a change in promoters with Late Mr. Rajan Mehra and his family taking over the management of the company. Since inception SOPL is engaged in the business of car dealership. Initially, the company had dealership of Daewoo Motors India Limited (DMIL) and Hindustan Motors Limited (HML) in Noida. Post-exit of DMIL from India and deterioration of share of HML in the Indian passenger vehicle market, the promoters got an opportunity with General Motors India Private Limited (GM) for their 'Chevrolet' brand of cars in October 2003. However, in May, 2017 General Motors decided to close its operations in India. Subsequently, SOPL under its subsidiary i.e. Triumph Motors Pvt. Ltd has been awarded dealership of Hyundai Motor India Ltd. for Udaipur in August, 2017. Further, SOPL was awarded dealership of Renault India Pvt. Ltd., under which the company operates three 3S outlets out of which two are at Jaipur, one at Dausa, and further operates 1S(Showrooms) outlets at Dholpur and Bharatpur each. SOPL was also awarded for the dealership of Suzuki Motorcycle India Private limited for Jaipur, Dausa, Kota, Chaksu, and Chomu. The promoters also have other companies namely, Nirmal Cars India Private Limited through which they have dealership of Renault India Private Limited for the selected regions of Rajasthan and Khushi Cars Private Limited (KCPL) through which they operate a showroom of high-end Isuzu brand vehicles. VBC RENEWABLE: CARE Lowers Rating on INR14.20cr LT Loan to D ------------------------------------------------------------ CARE Ratings revised the ratings on certain bank facilities of VBC Renewable Energy Private Limited, as: Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long term Bank 14.20 CARE D; Issuer not cooperating; Facilities Revised from CARE BB; Stable on the basis of best available information Detailed Rationale & Key Rating Drivers CARE has been seeking information from VBC Renewable Energy Private Limited to monitor the rating vide e-mail communications/letters dated October 22, 2018, January 28, 2019 and February 15, 2019, March 4, 2019 and numerous phone calls. However, despite CARE's repeated requests, the company has not provided the requisite information for monitoring the rating. In line with the extant SEBI guidelines, CARE has reviewed the rating on the basis of best available information which however, in CARE's opinion is not sufficient to arrive at fair rating. The rating on VBC Renewable Energy Private Limited's bank facilities will now be denoted as CARE D; ISSUER NOT COOPERATING. Users of this rating (including investors, lenders and the public at large) are hence requested to exercise caution while using the above rating. Detailed description of the key rating drivers The revision in the ratings of VBC Renewable Energy Private Limited takes into account ongoing delays in servicing the interest and installment in term loan facility. The rating assigned continues to be tempered by short track record of operations, leveraged capital structure, weak debt coverage indicators and susceptibility of power generation to variation in climatic conditions. However, the rating continues to derive benefits from experienced promoters for more than two decades in power Industry, long-term power purchase agreement (PPA) with APEPDCL and positive outlook of renewable power generation industry. Key Rating Weakness Ongoing delays in meeting of debt obligations: VBC Renewable Energy Private Limited has been facing liquidity issues from past few months, due to which the company is unable to service the interest and installment obligation on term loan facility. There are ongoing delays in servicing the interest and installment in term loan facility. Short track record: The company was incorporated in the year 2013 and started its commercial operations from July 2016, resulted in short track record of operations. The company has achieved TOI of INR2.38 crore during 10MFY18 (referring to the period April 2017 to January 2018). Susceptibility of power generation to variation in climatic condition: The company has proposed to use poly-crystalline technology considering that it has a proven history worldwide, suffers relatively lower degradation and requires lesser land leading to reduction in Balance of Systems cost. The company has achieved net PLF of 18.29% in FY17 and 17.81% in 10MFY18 due to variation in climatic conditions. However, achievement of desired CUF going forward would be subject to change in climatic conditions, amount of degradation of modules as well as technological risks (limited track record of solar technology in India). Leverage capital structure and weak debt coverage indicators: The capital structure of the company denoted by overall gearing deteriorated to 2.98x as on March 31, 2018 from 2.54x as on March 31, 2017 owing to increase in unsecured loans which has resulted in increase in total debt. The debt coverage indicators denoted by interest coverage ratio and total debt/GCA deteriorated from 1.53x and 26.87x as on March 31, 2017 to 1.34x and 30.63x respectively as on March 31, 2018. Key Rating Strengths Experience of the promoter for more than two decades in the power industry: VBC is promoted by Mr. C Pattabhi Rama Rao and his relatives. Mr C Pattabhi Rama Rao is a qualified post graduate having more than two decades of experience in power sector. The operations of the company are well supported by the technical team for smooth functioning of business operations. Long-term Power Purchase Agreement (PPA) with Eastern Power Distribution Company of Andhra Pradesh Limited (APEPDCL). The company has entered into Power Purchase Agreement (PPA) with APEPDCL for supply of 3MW power at a tariff of INR5.99/KWh for 25 years. The current tariff rate is INR6.17/KWh as per the PPA. VBC Renewable Energy Private Limited (VBC) was incorporated in the year 2013 and promoted by Mr C Pattabhi Rama Rao and his relatives. The company has setting up 3-MW solar photovoltaic (PV) power plant at Penubarthi Village, Visakhapatnam. The project achieved commercial operational from July 12, 2016 as envisaged. VBC has an entered into long-term power purchase agreement with APEPDCL dated December 4, 2014, for supply of 3-MW power at a tariff of INR5.99/KWh. The current tariff rate is INR6.17/KWh as per the PPA. VISWABHARATHI EDUCATIONAL: CARE Moves D Rating to Not Cooperating ----------------------------------------------------------------- CARE Ratings has migrated the rating on bank facilities of Viswabharathi Educational Society (VES) to Issuer Not Cooperating category. Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long term Bank 166.50 CARE D; Issuer not cooperating; Facilities Based on the best available information Detailed Rationale & Key Rating Drivers VES has not paid the surveillance fees for the rating exercise agreed to in its Rating Agreement. In line with the extant SEBI guidelines, CARE's rating on VES's bank facilities will now be denoted as CARE D; ISSUER NOT COOPERATING. Users of this rating (including investors, lenders and the public at large) are hence requested to exercise caution while using the above rating(s). The ratings take into account of ongoing delays in debt servicing by Viswabharathi Educational Society. Detailed description of the key rating drivers At the time of last rating on June 13, 2018, the following were the rating strengths and weaknesses. Delay in debt servicing by the company: The trust continues to delay in servicing of debt. The Trust had undertaken a significant debt funded capex which led to a weak financial profile. With addition of new batches during FY18, FY19 and FY20, VES was expected to earn cash profits sufficient enough to service the debt repayments. However intermittent cash flow mismatches led to delay in servicing its debt obligation. It is also to be noted that the Union Health Ministry had banned Viswabharathi Educational Society from accepting students to the Viswabharathi Medical College for the academic session 2018-19 based on the recommendations of Medical Council of India(MCI). Established in 1997, Viswabharathi Educational Society (VES) is promoted by Dr D Kantha Reddy and family. Various institutions under the promoter include Viswabharathi Medical College & Teaching Hospital, Viswabharathi Super Specialty Hospital, Viswabharathi Cancer Hospital, Viswabharathi College of Nursing, and Viswabharathi School of Nursing. WHOLESOME FOODS: CARE Lowers Rating on INR17.86cr Loan to D ----------------------------------------------------------- CARE Ratings revised the ratings on certain bank facilities of Wholesome Foods (WSF), as: Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long-term Bank 17.86 CARE D Revised from CARE B+; Facilities Stable Long/Short term 5.00 CARE D/CARE D Revised from Bank Facilities CARE B+; Stable/ CARE A4 Detailed Rationale & Key Rating Drivers The revision in the rating assigned to the bank facilities of WSF is primarily due to irregularity in servicing its debt obligations. Detailed description of key rating drivers Key Rating Weaknesses Ongoing delay in debt servicing: There are ongoing delays in serving of debt obligation due to delay in receipt of fiscal incentives. Bareja-Ahmedabad (Gujarat) based Wholesome Foods (WSF) was established in March, 2017 by Mr. Jeet Hirpara and Mr. Pravin Hirpara who are the managing partners of WSF along with Mr. Abhi Hirpara, Mr. Lalit Padghar, Mr. Jitesh Padghar, and Mr. Lalit Radadiya. WSF has completed project for manufacturing of frozen foods (fruits and vegetables) and ready to eat food products (such as Naan, Parathas, Frozen Gravies, Snacks like samosa & vada) under the brand name 'Origin'. The firm has commenced its commercial operations from end of July 2018 onwards. Jeet Impex, Jayshri International (engaged in to business of textile and warehouse business for agro commodities) and Vaibhav Ginning and Spinning Mills Private limited are associate entities, which are engaged into textile business and warehousing business. ================= S I N G A P O R E ================= HYFLUX LTD: PUB Serves 30-Day Notice for Takeover of Tuaspring -------------------------------------------------------------- The Business Times reports that the Public Utilities Board (PUB) has issued a notice to Hyflux Ltd to take over its biggest asset, the Tuaspring desalination plant, and terminate the parties' water purchase agreement. The termination notice to Hyflux unit subsidiary Tuaspring Pte Ltd (TPL) provides a 30-day notice period before PUB takes over the plant, the national water agency said in a media statement on April 17, BT relates. According to the report, PUB had announced in March that it would take over the desalination plant at zero dollars to safeguard Singapore's water security, waiving any compensation it could have claimed from Hyflux. The transaction would occur at zero cost to Hyflux, even though the desalination plant is expected to have negative value based on calculations done in accordance with the water purchase agreement. BT relates that the threat of Hyflux losing its Tuaspring has been looming since March 5, when PUB issued the notice to ask TPL to fix defaults at the plant by April 5. On March 25, the deadline to do so was extended to April 30. BT says PUB disclosed that TPL has had difficulties fulfilling its obligations under the water purchase agreement since 2017, including failing to keep the plant reliably operational. It also noted that TPL is loss-making and will require financial support from parent company Hyflux. Hyflux's ability to provide financial support to TPL depends on whether or not it would be able to complete its restructuring and obtain investment from then-white knight SM Investments, an Indonesian investor, the report states. Since then, Hyflux's had its rescue called off earlier this month after it terminated its lifeline deal with SM Investments, throwing its future into doubt, the report recalls. On April 15, Hyflux took legal action against SM Investments for abandoning the deal, BT notes. 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. It employs 2,300 people worldwide and has business operations across Asia, Middle East and Africa. 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. ********* 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 ***