/raid1/www/Hosts/bankrupt/TCRAP

/raid1/www/Hosts/bankrupt/TCRAP_Public/190614.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, June 14, 2019, Vol. 22, No. 119 Headlines A U S T R A L I A ARFOODS GROUP: Second Creditors' Meeting Set for June 21 BLUE SKY: Second Creditors' Meeting Set for June 20 CORSONIS PTY: First Creditors' Meeting Set for June 21 EDHOD PTY: Think Childcare Incubator Partner in Receivership ELDRIDGE MEDICAL: First Creditors' Meeting Set for June 20 ESMACC PTY: First Creditors' Meeting Set for June 21 JATENERGY LIMITED: Majority-Owned Subsidiary Calls in Receivers RODINI NOMINEES: Second Creditors' Meeting Set for June 21 SMHL SERIES 2019-1: S&P Assigns BB (sf) Rating to Class E Notes STERLING FIRST: Raised AUD8 Million After ASIC Probe VERTITECH TREE: First Creditors' Meeting Set for June 21 C H I N A CHINA: Bankruptcies and Slowdown Hang Over Electric Car Market HAPPY LIFE: Bad-Debt Manager Cinda to Shed Stake in Insurer YANGO JUSTICE: Moody's Rates Proposed USD Notes 'B3', Outlook Pos. ZHENRO PROPERTIES: Moody's Rates Proposed USD Perpetual Notes 'B2' I N D I A ARKA CARBON: CARE Maintains D Rating in Not Cooperating Category ASIAN IMPEX: CARE Maintains D Rating in Not Cooperating Category ATHENA CHHATTISGARH: Insolvency Resolution Process Case Summary BALJEET POULTRY: CARE Assigns B+ Rating to INR7cr LT Loan BHUSHAN STEEL: Ex-Promoter Case Transferred to Supreme Court DRUSHTI REALTORS: CARE Maintains D Rating in Not Cooperating EASTMADE SPICES: ICRA Reaffirms B Rating on INR5.50cr Loan GOPAL OIL: CARE Assigns B Rating to INR7.90cr LT Loan GRAFFITI (INDIA): CARE Maintains D Rating in Not Cooperating HIRAKUD INDUSTRIAL: Insolvency Resolution Process Case Summary HOTEL JALTARANG: CARE Assigns B- Rating to INR9.75cr LT Loan IL&FS: Deadline for Claims Submission Extended to June 20 JAWAHAR SAHAKARI: Ind-Ra Moves B+ Loan Rating to Non-Cooperating JAYMALA INFRASTRUCTURE: ICRA Keeps B+ Rating in Not Cooperating JET AIRWAYS: Stock Exchanges to Impose Trading Restrictions JHAWAR INTERNATIONAL: CARE Maintains D Rating in Not Cooperating LEEL ELECTRICALS: CARE Maintains D Rating in Not Cooperating LML LIMITED: ICRA Maintains D Rating in Not Cooperating MILIND PULSES: ICRA Maintains D Rating in Not Cooperating MM PATEL: CARE Downgrades Rating on INR13.84cr Loan to D NANI RESORTS: CARE Lowers Rating on INR20.45cr Loan to D NIGAM INDUSTRIES: CARE Maintains B+ Rating in Not Cooperating PRINT PLUS: Insolvency Resolution Process Case Summary RAJIV SWAGRUHA: NCLT Asks Group on IN343cr Dues to Shirke Group RSG DEVELOPERS: ICRA Maintains 'B' Rating in Not Cooperating SHREE GOKULESH: CARE Maintains B Rating in Not Cooperating SHRI MARUTINANDAN: CARE Maintains B Rating in Not Cooperating SONACHI INDUSTRIES: Ind-Ra Cuts LT Issuer Rating to D, Not Coop. SWASTIK COAL: CARE Maintains D Rating in Not Cooperating V HOTELS: Insolvency Resolution Process Case Summary N E W Z E A L A N D AVANTI RMBS 2019-1: Fitch to Rate Class E Notes 'BB(EXP)sf' - - - - - ================= A U S T R A L I A ================= ARFOODS GROUP: Second Creditors' Meeting Set for June 21 -------------------------------------------------------- A second meeting of creditors in the proceedings of Arfoods Group Pty Ltd has been set for June 21, 2019, at 11:00 a.m. at the offices of Romanis Cant, 2nd Floor, at 106 Hardware Street, in Melbourne, Victoria. 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 June 20, 2019, at 5:00 p.m. Anthony Robert Cant and Renee Sarah Di Carlo of Romanis Cant were appointed as administrators of Arfoods Group on May 16, 2019. BLUE SKY: Second Creditors' Meeting Set for June 20 --------------------------------------------------- A second meeting of creditors in the proceedings of Blue Sky Alternative Investments Limited has been set for June 20, 2019, at 10:00 a.m. at the offices of Pilot Partners, Level 10, at 1 Eagle 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 June 19, 2019, at 1:00 p.m. Bradley Vincent Hellen and Nigel Robert Markey of Pilot Partners were appointed as administrators of Blue Sky on May 20, 2019. CORSONIS PTY: First Creditors' Meeting Set for June 21 ------------------------------------------------------ A first meeting of the creditors in the proceedings of Corsonis Pty Ltd will be held on June 21, 2019, at 11:00 a.m. at the offices of Lowe Lippmann, Level 7, at 616 St Kilda Road, in Melbourne Victoria. Gideon Isaac Rathner and Matthew Brian Sweeny of Lowe Lippmann were appointed as administrators of Corsonis Pty on June 12, 2019. EDHOD PTY: Think Childcare Incubator Partner in Receivership ------------------------------------------------------------ Think Childcare Limited said that on June 6, 2019, receivers have been appointed to the Company's main incubator partner, Edhod. "The Company has been informed that the Receivers will take control of the assets and undertaking of Edhod Pty Ltd as trustee for the Edhod Unit Trust (being the Holding Company of the Edhod Group)," Think Childcare said in a statement released to the Australian Stock Exchange (ASX). "The Company has also been informed that the Edhod subsidiaries are not subject to the appointment of the Receivers and that Edhod is expected to continue to be able to execute on its development pipeline despite the appointment of the Receivers to Edhod Pty Ltd. "The Company will continue to monitor the situation with its incubator partner and promptly inform the market if it becomes aware of any material developments that could reasonably be expected to have a material effect on the financial position or performance of the Company," it said. ELDRIDGE MEDICAL: First Creditors' Meeting Set for June 20 ---------------------------------------------------------- A first meeting of the creditors in the proceedings of Eldridge Medical Pty. Ltd will be held on June 20, 2019, at 11:00 a.m. at the offices of Mackay Goodwin, Level 2, at 10 Bridge Street, in Sydney, NSW. Grahame Robert Ward and Domenic Alessandro Calabretta of Mackay Goodwin were appointed as administrators of Eldridge Medical on June 11, 2019. ESMACC PTY: First Creditors' Meeting Set for June 21 ---------------------------------------------------- A first meeting of the creditors in the proceedings of ESMACC Pty Ltd will be held on June 21, 2019, at 10:30 a.m. at the offices of Chartered Accountants Australia and New Zealand, Level 28, at 91 King William Street, in Adelaide, SA. Brent Kijurina and Richard Albarran of Hall Chadwick were appointed as administrators of ESMACC Pty on June 11, 2019. JATENERGY LIMITED: Majority-Owned Subsidiary Calls in Receivers --------------------------------------------------------------- just-food reports that a majority-owned subsidiary of Australia-based infant-formula exporter Jatenergy Limited has called in receivers to recover monies owed by Nutritional Choice Australia, which has reportedly defaulted on a manufacturing agreement. According to the report, local milk powder business Golden Koala, in which China-focused Jatenergy acquired a 51% stake last year, had entered into a production deal with Nutritional Choice Australia early in 2018 for infant milk formula, and in so doing paid a security deposit of AUD2m (US$1.4m). just-food relates that Golden Koala also made an up-front payment of AUD500,000 for Nutritional Choice Australia to apply for a licence from Beijing to import infant formula known as the Certification and Accreditation Administration of the People's Republic of China (CNCA). However, New South Wales-based Jatenergy said in a filing with the Australian Securities Exchange on June 12 Nutritional Choice Australia (NCA) had failed to honor the agreement. Golden Koala has therefore engaged the services of BDO Australia as receiver, the report says. "NCA defaulted under the manufacturing agreement and has never produced any milk formula for Golden Koala," just-food quotes Jatenergy as saying in a statement. "As a result, Golden Koala terminated the manufacturing agreement and demanded the repayment of AUD2.5 million by June 7. "As no repayment has been received by Golden Koala despite the demand, Golden Koala has appointed a receiver in order to recover the amount outstanding." It also appears Golden Koala has a claim on assets held by Nutritional Choice Australia after its subsidiary was granted a "security interest over all its personal property to secure its obligations under the manufacturing agreement", according to the filing cited by just-food. Meanwhile, Golden Koala is seeking other options for the manufacture of its infant formula products for the Chinese market, just-food adds. Jatenergy Limited engages in the cross border specialist fast moving consumer goods business in Australia and China. The company engages in the development and manufacture of various consumer products; related brand development, marketing, and promotion; and sale of client and in-house products primarily through a multichannel network, including traditional retail and e-commerce platforms. It primarily trades in milk powder, natural supplements, cosmetics, skin creams, and other products. RODINI NOMINEES: Second Creditors' Meeting Set for June 21 ---------------------------------------------------------- A second meeting of creditors in the proceedings of Rodini Nominees Pty Ltd has been set for June 21, 2019, at 11:00 a.m. at the offices of Romanis Cant, 2nd Floor, at 106 Hardware Street, in Melbourne, Victoria. 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 June 20, 2019, at 5:00 p.m. Anthony Robert Cant and Renee Sarah Di Carlo of Romanis Cant were appointed as administrators of Rodini Nominees on May 16, 2019. SMHL SERIES 2019-1: S&P Assigns BB (sf) Rating to Class E Notes --------------------------------------------------------------- S&P Global Ratings assigned its ratings to six classes of prime residential mortgage-backed securities (RMBS) issued by Perpetual Ltd. as trustee for SMHL Series Securitisation Fund 2019-1. SMHL Series Securitisation Fund 2019-1 is a securitization of prime residential mortgages originated by Members Equity Bank Ltd. The ratings reflect: -- S&P siad, "Our view of the credit risk of the underlying collateral portfolio, including our view that the credit support is sufficient to withstand the stresses we apply. The credit support for the rated bonds comprises bond subordination, excess spread and lenders' mortgage insurance on 36.6% of the portfolio." -- S&P's expectation that the various mechanisms to support liquidity within the transaction, including a liquidity facility equal to 1.0% of the outstanding mortgage balance, the principal draw function, and a spread reserve that builds from available excess spread, after the call-option date, are sufficient to ensure timely payment of interest. -- The extraordinary expense reserve of A$150,000 is provided via a cash drawing under the payment funding facility on the closing date to meet extraordinary expenses. The reserve is to be topped up from excess spread, if any, to the extent it has been drawn and has not been reimbursed from an additional payment funding facility draw. -- The fixed- to floating-rate interest-rate swaps provided by Australia and New Zealand Banking Group Ltd. and National Australia Bank Ltd. to hedge the mismatch between the fixed-rate receipts on the fixed-rate loans and the floating-rate interest payable on the bonds. A fixed-rate end date in June 2024, in the transaction structure means all fixed-rate loans in the trust must convert to floating rate by the fixed-rate end date. RATINGS ASSIGNED SMHL Series Securitisation Fund 2019-1 Class Rating Amount (mil. A$) A AAA (sf) 1,610.00 AB AAA (sf) 77.00 B AA (sf) 26.25 C A+ (sf) 17.50 D BBB+ (sf) 8.75 E BB (sf) 5.25 F NR 5.25 NR--Not rated. STERLING FIRST: Raised AUD8 Million After ASIC Probe ---------------------------------------------------- Neale Prior at The West Australian reports that failed lifetime lease group Sterling First raised at least AUD8 million from cash-strapped older West Australians after coming under close scrutiny by the Federal corporate watchdog in mid-2017. Reports to creditors and documents obtained by The West Australian show the Australian Securities and Investments Commission allowed promoters to keep selling senior Sterling New Life lease deals until at least October last year. More than 100 pensioners and people approaching retirement face losing their life savings and their leased homes after the collapse last month of Sterling First with up to AUD24 million of investors' money, the report says. According to The West Australian, ASIC came under fire from angry leaseholders at a creditors meeting on June 10 when administrator Martin Jones gave people little hope they would get anything but a fraction of their investments back. The West Australian says Sterling New Life promoted an innovative way for retirees to secure a lifetime lease over a property and have their rent paid by investing in a Sterling First trust company offering investment returns of at least 9 per cent. The West Australian notes that veteran property investment promoter Ray Jones and his son Ryan were key players in developing Sterling First and the Sterling New Life scheme. They were also helped in their fundraising activities by veteran investment promoter Simon Bell, the report says. Mr. Bell was an executive at Norm Carey's Westpoint group last decade and was leading plans with Ray Jones to float Sterling First on the stock exchange. But the Sterling New Life scheme hit turbulence in 2017 after WA consumer protection authorities began examining its lifetime leasing arrangements, The West Australian recounts. WA authorities are understood to have first raised concerns about the structure with ASIC in April that year, The West Australian says. ASIC moved to stop it raising more money from investors via the Sterling Income Trust in August 2017, but lifted the ban on the trust raising more money within three months. Sterling First was able to continue raising money from new investors after it became aware in mid-2018 that ASIC was investigating the group. It did this through a newly set up network of companies under the Silver Link banner, which were set up in late 2017, the report states. The West Australian adds that administrators from Ferrier Hodgson told creditors that ASIC investigations were focusing on the financial security and continued tenancy of Sterling New Life tenants. The report relates that Ferrier Hodgson said it understood ASIC had a peripheral focus on money being raised by Silver Link companies "potentially to circumvent the requirement to issue a prospectus". "We have been made aware of serious allegations made against a number of companies within the group and their directors and representatives by solicitors acting for tenants of properties associated with (Sterling New Life)," the administrator's report said, The West Australian relays. Martin Bruce Jones and Wayne Anthony Rushton of Ferrier Hodgson were appointed as administrators of Sterling First (Aust) Pty Ltd and related companies on May 3, 2019. VERTITECH TREE: First Creditors' Meeting Set for June 21 -------------------------------------------------------- A first meeting of the creditors in the proceedings of Vertitech Tree Solutions Pty Ltd will be held on June 21, 2019, at 10:00 a.m. at the offices of Rapsey Griffiths Turnaround + Insolvency, Level 5, at 55-57 Hunter Street, in Newcastle, NSW. Mitchell Griffiths of Rapsey Griffiths was appointed as administrator of Vertitech Tree on June 11, 2019. ========= C H I N A ========= CHINA: Bankruptcies and Slowdown Hang Over Electric Car Market -------------------------------------------------------------- The Financial Times reports that they have billions of dollars in funding, backing from China's biggest tech companies and the world's largest electric vehicle market at their doorstep. But Chinese EV start-ups face a struggle to survive in the face of intensifying competition and subsidy cuts, the FT says. The FT relates that although analysts are reluctant to name companies that could disappear, the two dozen Chinese EV start-ups such as Nio and Xpeng, which have raised more than $10 billion in recent years, are expected to be cut down to a handful. According to the FT, China's electric vehicle sales have grown tenfold since 2014 and last year it became the first country to see new energy vehicle sales surpass 1 million, about three-quarters of which were pure EVs and the rest hybrids. But that growth has been dependent on subsidies averaging at RMB70,000 (US$10,100) per vehicle, allowing companies to lower prices. This month, subsidies will be cut to about RMB25,000 for most vehicles, the report discloses. That will force companies to raise prices, wiping away one of the key reasons for their sales at a stroke, or accept lower margins on businesses that are already lossmaking, according to the FT. The FT relates that Yale Zhang of consultancy Auto Foresight sid the cut is expected to reduce year-on-year growth of EV sales to about 20 per cent in the second half of 2019 compared with 60 per cent in April, as consumers rush to beat the end of subsidies. Three big groups: BYD, Beijing Auto and Shanghai Auto, accounted for half of China's electric vehicle sales last year, the FT says. They tend to sell cheap vehicles: The current top seller, BYD's Yuan, is priced under RMB99,000 with a range of 360km. That compares with the price of an imported Tesla Model 3 at RMB377,000 with a range more than 400km. According to the FT, more than 15 venture-capital-backed EV start-ups displayed prototypes at the Auto Shanghai show in April, which they hope can win market share by offering higher-quality at a premium price compared with currently popular Chinese models. They include Alibaba-backed Xpeng, which raised $587 million in its latest funding round, and WM Motor, which raised $446 million in a March funding round led by internet company Baidu and sold more than 4,000 vehicles in the first quarter, the FT discloses. For Nio, which raised $1 billion in a US initial public offering last year and sold more than 11,000 electric SUVs priced about RMB450,000, the cut in subsidies will mean an increase in its prices by about 10 per cent, the FT states. This would put the finances of the lossmaking company under more strain, admitted Nio founder William Li, the FT relates. The company reported a $390 million total loss in the first quarter of this year, leading it to announce an equity sale to raise $1.5 billion from a state-owned fund, says the FT. The FT adds that Mr. Li warned it was difficult to market more expensive cars as Chinese consumers were wary of paying high prices. "There are two major problems: charging infrastructure and mindset," the FT quotes Mr. Li as saying referring to the difficulty of making people switch to electric cars. "Consumers need time to change their way of thinking." HAPPY LIFE: Bad-Debt Manager Cinda to Shed Stake in Insurer ----------------------------------------------------------- Wu Yujian and Timmy Shen at Caixin Global report that Happy Life Insurance Co. Ltd. had a loss of billions of yuan last year, and now it may lose its controlling shareholder. The board of the Hong Kong-listed China Cinda Asset Management Co. Ltd., one of China's four major asset management companies, intends to transfer all the company's equity interest in Happy Life through public bidding to "implement relevant regulatory spirit and to optimize and integrate platform resources of subsidiaries," Caixin relates citing an exchange filing on June 11. China Cinda holds nearly 51% of the money-losing midsize life insurer. "All shares will be transferred to a single buyer or a group of joint buyers in a single transaction," China Cinda said in the filing cited by Caixin. The equity transfer plan will be subject to the approval of shareholders and relevant regulatory authorities, the report says. Happy Life posted a poor performance last year, Caixin notes. In 2018, the insurer recorded a net deficit of CNY6.8 billion (US$983 million), reflecting losses on equity investments, and its premium income dropped by more than half to about CNY9.2 billion from 2017's CNY18.5 billion, Caixin discloses citing the company's 2018 annual report. Founded in November 2007, Happy Life turned profitable in 2015, reporting a net profit of CNY335.3 million (US$48.4 million) after suffering net losses for six straight years, Caixin discloses citing annual reports on Cinda's website. Net profits in 2016 shrank to CNY18 million before rebounding slightly in 2017 to CNY49.4 million, Caixin relays. Caixin notes that the insurer's performance also dragged down China Cinda's profitability. The bad asset manager issued a profit warning in January, saying its net profit for 2018 would decline, blaming Happy Life's significant loss. In 2018, China Cinda posted a net profit of about CNY12 billion, down 33.7% from 2017's CNY18.1 billion, according to the company's annual report, Caixin relays. Other shareholders of Happy Life include Sanpower Group Co. Ltd., which holds a 14.2% stake in Happy Life and has been saddled with debt itself. Another shareholder, Shaanxi Coal and Chemical Industry Group Co. Ltd., has also drawn public attention recently, as one of its employees, Yao Chunlei, disappeared from the public after his alleged connection with a disgraced former provincial Communist Party chief, Caixin says. Based in Beijing, China, Happy Life Insurance Co., Ltd, provides various insurance products and services in China. It offers life, health, accident, personal, annuity, and pension insurance products. YANGO JUSTICE: Moody's Rates Proposed USD Notes 'B3', Outlook Pos. ------------------------------------------------------------------ Moody's Investors Service has assigned a B3 senior unsecured rating to the proposed USD notes to be issued by Yango Justice International Limited and guaranteed by Yango Group Co., Ltd (Yango, B2 positive). The rating outlook is positive. Yango plans to use the bond proceeds mainly to refinance existing indebtedness. RATINGS RATIONALE "The proposed bond issuance will lengthen Yango's debt maturity profile and will not have a material impact on its credit metrics, because the proceeds will mainly be used to repay existing debt," says Celine Yang, a Moody's Assistant Vice President and Analyst. Moody's expects that the company's debt leverage--as measured by revenue/adjusted debt--will trend towards 60%-65% over the next 12-18 months from 44% in 2018. Similarly, its interest coverage--as measured by adjusted EBIT/interest--will improve to around 2.3x-2.5x from 2.2x over the same period, driven by likely revenue growth and stable profit margins. Yango's liquidity is good. The company reported cash balance of RMB 37.9 billion at the end of 2018. Moody's expects that its current cash balance, together with the cash flow generated from its strong pre-sales, will be able to cover its short-term debt, the RMB2.59 billion onshore bond becoming puttable in 3Q 2019, and committed land premiums through June 2020. Yango's B2 corporate family rating reflects the company's quality and geographically diversified land bank, large scale and strong sales execution. On the other hand, Yango's rating is constrained by its high debt leverage, due to its sizable land acquisitions to support its rapid growth and expansion into new regions in China. The B3 rating for Yango Justice International Limited's senior unsecured notes is one notch lower than Yango's CFR of B2, reflecting structural subordination risks. This risk reflects the fact that the majority of claims are at the operating subsidiaries, and have priority over claims at the holding company in a bankruptcy scenario. In addition, the holding company lacks significant mitigating factors for structural subordination. As a result, the likely recovery rate for claims at the holding company will be lower. The positive outlook reflects Moody's expectation that (1) Yango's credit metrics, particularly the debt leverage, will improve; and (2) the company will gradually reduce its funding through trust financing; and (3) the company will maintain a good liquidity position. Moody's could upgrade Yango's ratings if the company improves its liquidity and debt leverage, while maintaining its strong contracted sales growth. Credit metrics indicative of upward ratings pressure include: (1) revenue/adjusted debt above 60%-65%; (2) adjusted EBIT/interest above 2x; and (3) cash/short-term debt above 1.25x, on a sustained basis. On the other hand, the ratings outlook could return to stable, if the company fails to improve its liquidity or credit metrics, with adjusted EBIT/interest below 1.25x-1.50x or revenue/ adjusted debt failing to trend towards 60%-65% on a sustained basis. The principal methodology used in this rating was Homebuilding And Property Development Industry published in January 2018. Founded in 1995 in Fuzhou, Yango Group Co., Ltd is a Chinese property developer that focuses on the Greater Fujian and Yangtze River Delta regions. The company listed on the Shenzhen Stock Exchange in 2002, with a market capitalization of RMB27 billion ($3.9 million) as of 11 June 2019. Yango's operations are mainly focused on mass-market residential property development. The company had a total land bank of around 44.18 million square meters as of December 31, 2018. ZHENRO PROPERTIES: Moody's Rates Proposed USD Perpetual Notes 'B2' ------------------------------------------------------------------ Moody's Investors Service has assigned a B2 senior unsecured rating to Zhenro Properties Group Limited's (B1 stable) proposed USD senior perpetual capital securities. The perpetual securities will be issued directly by Zhenro and rank pari passu with all of Zhenro's other present and future unsecured and unsubordinated obligations. Zhenro plans to use the proceeds from the proposed notes to refinance existing debt. RATINGS RATIONALE "The proposed bond issuance will not materially change Zhenro's credit metrics because the proceeds will mainly be used to refinance existing debt," says Cedric Lai, a Moody's Vice President and Senior Analyst. Zhenro's B1 corporate family rating reflects the company's (1) sizable scale, (2) strong sales execution, and (3) quality and geographically diversified land bank, with no one city representing more than 20% of its total land bank. Zhenro has also demonstrated improved assess to funding, especially in the debt capital markets. On the other hand, the CFR is constrained by Zhenro's moderate but improving financial metrics, because of its rapid debt-funded growth. In addition, the rating reflects Zhenro's increasing exposure to joint venture (JV) businesses; a situation which lowers the transparency of its credit metrics. Nevertheless, this risk is mitigated by the company's reputable JV partners. Moody's has taken into account the concentrated ownership of Zhenro's key shareholder, Mr. Ou Zongrong and his two sons, acting in concert, who together held a total 68.4% stake in the company at the end of 2018. The concentrated ownership is incorporated in the B1 CFR and is partly mitigated by: 1) the presence of three independent non-executive directors on the board, who also chair the audit and remuneration committees, 2) the low level of related-party transactions and dividend payout ratio of around 24% in 2018, and 3) the presence of other internal governance structures and standards as required under the Corporate Governance Code for companies listed on the Hong Kong Exchange. The B2 senior unsecured debt rating is one notch lower than the CFR due to structural subordination risk. This subordination risk refers to the fact that the majority of Zhenro's claims are at its operating subsidiaries and have priority over claims at the holding company in a bankruptcy scenario. In addition, the holding company lacks significant mitigating factors for structural subordination. Consequently, the expected recovery rate for claims at the holding company will be lower. The B2 senior unsecured rating for the proposed perpetual capital securities also considers the following factors: (1) Moody's treatment of the proposed perpetual securities as pure debt instruments. Moody's therefore does not apply any equity treatment to these securities. (2) The ranking of the securities, which will be pari passu with all of Zhenro's other present and future senior obligations. Moody's expects that Zhenro's debt leverage — as measured by revenue/adjusted debt — will trend towards 60%-65% over the next 12-18 months from 50% at the end of 2018. Its interest coverage — as measured by adjusted EBIT/interest — should also improve to around 2.3x-2.5x from 1.9x over the same period. Zhenro's liquidity is good. The company's cash and cash equivalents/short-term debt improved to 119% at the end of 2018 from 86% at the end of 2017, largely driven by an increase in cash and deposits — including restricted cash — to RMB28.4 billion from RMB19.7 billion over the same period. The stable ratings outlook reflects Moody's expectation that over the next 12-18 months, Zhenro will be able to execute its sales plan, demonstrate its prudent financial management with sufficient liquidity. Moody's could upgrade Zhenro's ratings if the company (1) demonstrates sustained growth in its contracted sales and revenue through the economic cycles without sacrificing its profitability; (2) remains prudent in its land acquisitions and financial management; (3) improves its credit metrics, such that EBIT/interest registers at least 3.0x and revenue/adjusted debt rises to 75%-80% or above on a sustained basis; and (4) maintains adequate liquidity. On the other hand, the company's ratings could come under downward pressure if Zhenro: (1) generates weak contracted sales; (2) suffers from a material decline in its profit margins; (3) experiences an impairment of its liquidity position, such that cash/short-term debt falls below 1.0x; and/or (4) materially increases its debt leverage. Credit metrics indicative of a ratings downgrade include EBIT/interest coverage falling below 2.0x, and/or adjusted revenue/debt falling below 50%-55% on a sustained basis. The principal methodology used in this rating was Homebuilding And Property Development Industry published in January 2018. Zhenro Properties Group Limited was incorporated in the Cayman Islands in 2014 and listed on the Hong Kong Stock Exchange in January 2018. At 31 December 2018, Zhenro had 145 projects in 28 cities across China. Its key operating cities include Shanghai, Nanjing, Fuzhou, Suzhou, Tianjin and Nanchang. The company was founded by Mr. Ou Zongrong, who indirectly owned 57.85% of Zhenro Properties at 31 December 2018. His sons, Mr. Ou Guowei and Mr. Ou Guoqiang, together owned 10.55% of the company as of the same date. ========= I N D I A ========= ARKA CARBON: CARE Maintains D Rating in Not Cooperating Category ---------------------------------------------------------------- CARE Ratings said the rating for the bank facilities of Arka Carbon Fuels Pvt. Ltd. (ACFPL) continues to remain in the '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 120.00 CARE D; Issuer Not Cooperating; Facilities Based on best available Information Detailed Rationale & Key Rating Drivers CARE, vide press release dated March 9, 2018, had placed the rating of ACFPL under the 'Issuer Non-cooperating' category as the company had failed to provide information for monitoring of the ratings and had not paid the surveillance fees for the rating exercise as agreed to in its Rating Agreement. ACFPL continues to be non-cooperative despite repeated requests for submission of information through phone calls and a letter dated May 22, 2019. 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. 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 for the bank facilities of Arka Carbon Fuels Pvt. Ltd. (ACFPL) take into account the ongoing delays in servicing of its debt obligations due to its stressed liquidity. Detailed description of the key rating drivers At the time of last rating on March 9, 2018, the following were the rating strengths and weaknesses (updated based on the best available information): Key Rating Weaknesses Ongoing delays in servicing of debt obligations: There are ongoing delays in servicing of ACFPL's debt obligations due to its stressed liquidity. Swastik group includes three companies operating in similar line of coal trading & transport businesses viz. Swastik Coal Corporation Pvt. Ltd. (SCCPL), Arka Carbon Fuel Pvt. Ltd. (ACFPL) & Shree Ganpatlal Onkarlal Agarwal & Co. (SGOAC). We have taken a combined approach of these three companies for arriving at ratings of SCCPL, ACFPL & SGOAC due to common promoters & management and strong operational & financial linkages among the group entities in coal trading business. ASIAN IMPEX: CARE Maintains D Rating in Not Cooperating Category ---------------------------------------------------------------- CARE Ratings said the rating for the bank facilities of Asian Impex (AI) continues to remain in the 'Issuer Not Cooperating' category. Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long term Bank 7.50 CARE D; Issuer not cooperating; Facilities Based on best available Information Detailed Rationale & Key Rating Drivers CARE had, vide its press release dated March 1, 2018, placed the rating(s) of AI under the 'issuer non-cooperating' category as AI had failed to provide information for monitoring of the rating for the rating exercise as agreed to in its Rating Agreement. AI continues to be non-cooperative despite repeated requests for submission of information through e-mails, phone calls and an email dated March 4, 2019, April 1, 2019, April 5, 2019, April 10, 2019, April 16, 2019, April 18, 2019 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. 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 March 1, 2018, the following were the rating strengths and weaknesses: Key Rating Weaknesses Ongoing delay in debt servicing: Asian Impex has been irregular in servicing its debt obligation as the packing credit account remained overdrawn on the back of deterioration in overall financial risk profile coupled with slow realization from its debtors thereby leading to weak liquidity position. Asian Impex (AI), incorporated in 2010, is promoted by Mr. Haron Haji Panja, Mr. Altaf Chhel, Mr. Ashif Harun Panja, Mr. Kashif Harun Panja, Ms. Halima Safi Panja and Mr. Aaysa Harun Panja. AI is engaged in processing of sea foods and exports the same to Europe, Gulf countries, Africa and China. AI has a processing cum storage facility located at Veraval (Gujarat) with total installed capacity of 50 MTPD (metric ton per day) for processing of Sea Foods and 1,000 metric tons storage capacity as on March 31, 2016. ATHENA CHHATTISGARH: Insolvency Resolution Process Case Summary --------------------------------------------------------------- Debtor: Athena Chhatisgarh Power Limited 7-1-24/1/RT, G-1, B-Block Roxana Towers Greenlands Begumpet Hyderabad TG 500016 IN Insolvency Commencement Date: May 24, 2019 Court: National Company Law Tribunal, Hyderabad Bench Estimated date of closure of insolvency resolution process: November 20, 2019 Insolvency professional: C. Bala Mouli Interim Resolution Professional: C. Bala Mouli 1-7-297118A, 125 M.G. Road Parsi Compound Behind Godrej Show Room, Secunderabad Telangana 500003 E-mail: irpcbmouli@gmail.com athenachpower.cirp@gmail.com Last date for submission of claims: June 7, 2019 BALJEET POULTRY: CARE Assigns B+ Rating to INR7cr LT Loan --------------------------------------------------------- CARE Ratings has assigned rating to the bank facilities of Baljeet Poultry Farm (BPF), as: Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long-term Bank Facilities 7.00 CARE B+; Stable Assigned Detailed Rationale & Key Rating Drivers The rating assigned to the bank facilities of BPF is constrained by small scale of operations, low profitability margins, leveraged capital structure and working capital intensive nature of operations. The rating is further constrained by the constitution of entity being a partnership firm, inherent risk associated with poultry industry coupled with high competition from local players. The rating, however, takes comfort from experienced partners along with long track record of operations and positive demand outlook of poultry industry. Going forward, the ability of the firm to increase its scale of operations while maintaining its profitability margins and improving its overall solvency position and the ability of the firm to efficiently manage its working capital cycle. Detailed description of the key rating drivers Key Rating Weaknesses Small scale of operations and low profitability margins: Though, the total Operating Income (TOI) of the firm increased from INR5.04 crore in FY16 to INR9.83 crore in FY18 at compounded annual growth rate (CAGR) of ~39.66% on account of higher orders received from its existing as-well-as new clients. The same continues to remain small. The small scale of operations limits the firm's financial flexibility in times of stress and deprives it from scale benefits. The profitability margins stood low, however, improved marginally on a y-o-y basis marked by PBILDT and PAT margins of 4.51% and 0.37%, respectively, in FY18. In 11MFY19 (Prov.), the firm has achieved a total operating income of ~INR13.70 cr with PBILDT and PAT margins of 11.00% and 5.84%, respectively. Leveraged capital structure: The capital structure of the BPF stood leveraged marked by long-term debt to equity ratio of 1.97x (PY: 1.09x) and overall gearing ratio of 2.65x (PY: 1.69x).The same deteriorated from previous year due to additional term loans and unsecured loans availed by the firm in FY18 coupled with higher utilization of working capital limits as on last balance sheet date as compared to previous year. Liquidity position: The operating cycle of the firm stood moderate at 50 days for FY18 (PY: 36 days). The working capital limits were fully utilized for the last 12 months period ended April, 2019. The current and quick ratios also remained at 2.07x and 0.39x, respectively (Previous Year: 1.73x and 0.23x, respectively). The current ratio of the firm stood moderate at 2.07x, however, the quick ratio stood weak at 0.39x as on March 31, 2018. The firm had free cash and bank balance of INR0.09 crore as on March 31, 2018. Partnership nature of constitution: BPF's constitution as a partnership firm has the inherent risk of possibility of withdrawal of the partners' capital at the time of personal contingency and firm being dissolved upon the death/retirement/insolvency of partners. Moreover, partnership firms have restricted access to external borrowing as credit worthiness of partners would be the key factors affecting credit decision of the lenders. Key Rating Strengths Experienced partners along with long track record of operations: BPF was established in 2005 and its day to day operations are looked after by the partners jointly. Mr. Jagtar Singh has an industry experience of more than three decades gained through his association with BPF and other regional entities engaged in similar business operations. Mr. Kulbir Singh and Mr. Baljeet Singh have industry experience of more than one decade gained through her association with BPF only. The partners have adequate acumen about various aspects of business which is likely to benefit BPF in the long run. The long track record has aided the firm in having established relationship with customers and suppliers. Haryana-based, Baljeet poultry Farm (BPF) was established in 2005 as a partnership firm by Mr. Jagtar Singh, Mr. Kulbir Singh, Mr. Baljeet Singh. BPF is engaged in poultry business which includes broiler farming which involves growing of one day chick into egg laying birds. Subsequently the eggs laid by them are artificially incubated into chicks (incubation time is 35 days). The processing facility of the firm is divided into 3 units, each located at Assandh, Karnal, Haryana with an overall breeding capacity of 16,50,000 chicks per annum in broiler facility as on March 31, 2019. BHUSHAN STEEL: Ex-Promoter Case Transferred to Supreme Court ------------------------------------------------------------- BloombergQuint reports that the Supreme Court said Neeraj Singal, former promoter of Bhushan Steel, will remain out on interim bail granted by the Delhi High Court in a INR2,500-crore fraud case. A bench comprising Justice AM Khanwilkar and Justice DY Chandrachud, however, stayed the operation of the Delhi High Court judgement and transferred to itself the plea Singal had filed in the high court for adjudication, BloombergQuint says. According to BloombergQuint, the bench said it was only allowing the interim bail to continue, and the operation of the rest of the judgment regarding various aspects, including the Serious Fraud Investigation Office's power to arrest and investigate, will be deliberated later. BloombergQuint says the Delhi High Court had on Aug. 29, 2018, granted bail to Singal, arrested by the Serious Fraud Investigation Office for allegedly siphoning off public funds. BloombergQuint says the apex court was hearing an SFIO plea to stay the Delhi High Court order in the case. The agency had earlier said his release will cause grave harm to the ongoing probe, which has reached an advanced stage, the report notes. About Bhushan Steel India-based Bhushan Steel -- http://www.bhushan-group.org/-- manufactures auto-grade steel. Bhushan Steel is one of the 12 non-performing assets referred by the Reserve Bank of India for National Company Law Tribunal (NCLT) proceedings. NCLT admitted the bankruptcy plea against the steel company filed by State Bank of India on July 26, 2017. Bhushan Steel's total debt stood at around INR42,355 crore as of March 31, 2017. In May 2018, Bamnipal Steel Ltd (BNPL), a wholly-owned subsidiary of Tata Steel, completed the acquisition of controlling stake of 72.65 per cent in Bhushan Steel Ltd (BSL). DRUSHTI REALTORS: CARE Maintains D Rating in Not Cooperating ------------------------------------------------------------ CARE Ratings said the rating for the bank facilities of Drushti Realtors Private Limited (DRPL) continues to remain in the 'Issuer Not Cooperating' category. Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long term Bank Facilities 15.00 CARE D; Issuer not cooperating; Based on best available information Detailed Rationale & Key Rating Drivers CARE had, vide its press release dated March 30, 2018, placed the rating(s) of DRPL under the 'issuer non-cooperating' category as Drushti Realtors Private Limited had failed to provide information for monitoring of the rating. Drushti Realtors Private Limited continues to be non-cooperative despite repeated requests for submission of information through e-mails, phone calls and a letter dated May 23, 2019. 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. 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 March 30, 2018 the following were the rating strengths and weaknesses: Key rating Weakness On-going delay in debt servicing: As per the interaction with the banker there are ongoing delays in repayment of principals/payment of interests by the company. Incorporated in 2005 by Mr Ashok Jagdale, DRPL belongs to the Drushti Group (DG), and is engaged in construction & development of residential as well as residential cum commercial spaces. The company has recently completed a residential cum commercial project named Varun at Pant Nagar, Ghatkopar (East), spanning across total area of 50,000 Sq. Ft. with ground & 1st floor of commercial spaces and 16 floors of residential spaces. The complex comprises 50 flats, 7 shops and 3 offices (however, the bank term loan is yet to be repaid fully). Moreover, DG has developed many residential as well as residential cum commercial spaces in Andheri (West) and Bandra (East). Currently, DRPL is undertaking a residential project named Embassy at Pant Nagar, Ghatkopar (East), spanning across total area of 1,28,250 Sq. Ft. with 16 floors plus basement & ground floor, with a total project cost of INR88.02 crore to be funded by promoters' contribution worth INR26 crore, bank term loan worth INR25 crore and the balance from customer advances. EASTMADE SPICES: ICRA Reaffirms B Rating on INR5.50cr Loan ---------------------------------------------------------- ICRA reaffirmed ratings on certain bank facilities of Eastmade Spices & Herbs Pvt. Ltd. (ESHPL), as: Amount Facilities (INR crore) Ratings ---------- ----------- ------- Fund based-CC 3.75 [ICRA]B (Stable); Reaffirmed, (PC cum FBP/FBD) removed from issuer not cooperating category Fund based- 5.50 [ICRA]B (Stable); Reaffirmed, Term Loan removed from issuer not cooperating category Rationale The ratings reaffirmation continues to factor into account ESHPL's weak financial profile due to delays in project commission leading to low operating income (OI), net losses, adverse capital structure and poor coverage indicators. The ratings are further constrained by the intense competition and fragmented nature of the industry and vulnerability of the company's profitability to fluctuations in raw material prices, which are subject to seasonality, crop harvest and agro-climatic conditions. The ratings, however, takes comfort from the extensive experience of ESHPL's promoters in the agro-commodities business of more than three decades and the location-specific advantage derived from its proximity to the raw material sources. Outlook: Stable ICRA believes ESHPL will continue to benefit from the extensive experience of its promoters. The outlook maybe revised to Positive with desired ramp-up and stabilisation of operations leading to increase in operating income and profits thereby generating adequate cash accruals for debt servicing apart from significant capital infusion leading to improvement in the the capital structure and coverage indicators. The outlook maybe revised to Negative if any further decline in sales or profitability results in further reduction in lower-than-anticipated cash accruals, or in case of cessation of support from promoters for debt servicing leading to weakening of the liquidity profile. Key rating drivers Credit strengths Extensive experience of the promoters in the agro-commodities business - The company is managed by the Patel family with the promoters having extensive experience spanning nearly three decades in the agro-commodities business. The promoter group is also associated with other associate entities - Super Psyllium and Satnam Psyllium Industries engaged in similar operations. Location-specific advantage - The company enjoys location-specific advantage by virtue of its presence in Unjha, Gujarat and its proximity to Mundra port, which provides easy access to raw material (agro commodities) Credit challenges Weak financial risk profile - Due to a delay in project commission, the company carried out only sorting operations in the last two fiscals following which the operating income stood low at INR4.93 crore and INR6.03 crore in FY2018 and FY2019 respectively. The operating profit margin stood at 8.67% in FY2018 and 11.79% in FY2019, though it reported a net loss of INR0.55 crore in FY2019 due to high depreciation and interest cost. Further, on account of erosion of net worth, the capital structure deteriorated as depicted by a gearing of 6.83 times as on March 31, 2019. ESHPL's net loss, coupled with significant debt repayment obligations, lead to poor coverage indicators as reflected by interest coverage ratio of 0.83 times as on March 31, 2018 and 2.31 times as on March 31, 2019 (provisional). Its TD/OPBDITA stood weak at 8.52 times as on March 31, 2019 with DSCR of 0.65 times in FY2019. Further, its working capital intensity increased in FY2019 with NWC/OI of 14% compared to 9% in FY2018 due to high inventory. Business exposure to agro-climatic and regulatory changes; intense competition due to low entry barriers – The agrocommodity trading business remains dependent on the performance of the agricultural sector, which is further impacted by a combination of factors like climatic conditions, prevailing demand–supply scenario, regulatory changes pertaining to export incentives etc. Further, the low value additive nature of operations, coupled with intense competition in the industry, exert pressure on its profitability. Liquidity position ESHPL's cash flow from operations continued to remain negative due to small scale of operations and high interest expenses. Further, the free cash flow remained negative due to significant debt repayment obligations. The liquidity profile is expected to remain tight in the near to medium term, given generation of inadequate cash accruals and high impending debt repayment obligations. Thus support from promoters would continue to remain crucial. Incorporated in October 2015, as a part of Satnam Group, ESHPL was set up with an objective to process food grains and various spices. The manufacturing plant is installed with a capacity of 4,680 tonne per annum and was planned to commission in April 2017, however, due to delays in installation of machinery and change in the management in FY2018, the processing has not commenced yet. The project is planned to commence operations in FY2020. The promoters have an extensive experience in the agro-commodities business spanning over three decades and are associated with similar entities such as Satnam Psyllium Industries and Super Psyllium, which are also involved in the agro-commodities business. GOPAL OIL: CARE Assigns B Rating to INR7.90cr LT Loan ----------------------------------------------------- CARE Ratings has assigned rating to the bank facilities of Gopal Oil Industries (GOPAL), as: Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long term Bank Facilities 7.90 CARE B; Stable Assigned Detailed Rationale, Key Rating Drivers and Detailed description of the key rating drivers The rating assigned to the bank facilities of GOPAL is primarily constrained on account of decline in scale of operations as well as constitution as proprietorship concern, moderate profitability margins with leveraged capital structure and working capital intensive nature of operation. The rating, further, constrained on account of operating margins susceptible to cotton price fluctuation and seasonality associated with the cotton industry. The rating, however, favorably takes into account of long track record of operations with experienced management in the cotton oil industry and strategically located in the cotton growing region. The ability of the firm to increase in scale of operations while maintaining profitability margins and better working capital management along with improvement in its solvency position would be the key rating sensitivities. Detailed description of the key rating drivers Key Rating Weakness Decline in scale of operations as well as constitution as proprietorship concern: As per FY19 (FY refers to period from April 01 to March 31) provisional results, the scale of operations of the firm stood small marked by Total Operating Income (TOI) of INR 11.65 crore, declined by 53.33% over FY18, due to price fluctuation of raw material and low sale of its products with low net-worth base of INR0.05 crore as on March 31, 2019. Further, its constitution as a proprietorship firm restricts its overall financial flexibility in terms of limited access to external funds for any future expansion plans. Further, there is inherent risk of possibility of withdrawal of capital and dissolution of the firm in case of death/insolvency of proprietor. Moderate profitability margins with leveraged capital structure: The profitability margins of the firm stood moderate on account of limited value addition. During FY19, the firm registered PBILTD and PAT margin of 13.37 % and 3.89% respectively as against operating loss and net loss respectively in FY18. The key raw material of the product is cotton seed and demand of cottonseed is seasonal in nature. Hence the firm is exposed to the risk to pass on increase in prices to its customers. The capital structure of the firm stood highly leveraged. The debt service coverage indicators of the firm stood weak with total debt to GCA at 22.36 times as on March 31, 2019, improved as against FY18 mainly due to improvement in GCA level. Moreover, the interest coverage indicators stood moderate at 1.56 times in FY19. Working capital intensive nature of operation: The firm operations are high working capital intensive in nature, resulting from high inventory holding period of 356 days and collection period of 105 days which impacts the firm's liquidity. The liquidity profile of the firm also stood stressed with 90-95% utilization of working capital borrowings in last twelve months ended March 31, 2019. The current ratio of the firm stood 1.47 times and quick ratio of the firm stood below unity at 0.47 times, respectively as on March 31, 2019 mainly due to maintenance of higher inventory of raw material as well as finished goods to meet the customer demands. Further, the cash and bank balance of the firm stood 0.07 Crore as on March 31, 2019. Operating margins susceptible to cotton price fluctuation and seasonality associated with the cotton industry: Operations of cotton business are seasonal in nature, as sowing season is done during March to July and harvesting cycle (peak season) is spread from November to February every year. Prices of raw material i.e. raw cotton are highly volatile in nature and depend upon factors like monsoon condition, area under production, yield for the year, international demand supply scenario, export policy decided by government and inventory carried forward of the last year. They usually have to procure raw materials at significantly higher volume to bargain bulk discount from suppliers. Furthermore, cotton being a seasonal crop, the inventory levels of the entity generally remains high at the end of the financial year. Thus, aggregate effect of both the above factors results in exposure of ginners to price volatility risk. The Key raw material for the firm is cottonseed; demand of the cottonseed is being seasonal in nature. Hence the firm remain exposed to any supply disruption and have limited ability to pass on the increase in prices to its customers. Key Rating Strengths Long track record of operations with experienced management in the cotton oil industry: The firm started its operations in 1991, hence has a track record of around two decades in the industry. Mr Gopal Paliwal (Promoter), looks after the production process of the firm and having experience of 26 years in processing and trading of cotton seeds and cotton oil. Being present in the industry since long, the promoters have established relations with customers and suppliers. Mr Summit Paliwal (Manager) is MBA by qualification and have experience of 11 years in this industry and looks after marketing and finance activity of the firm. Strategically located in the cotton growing region: Gujarat, Maharashtra, Andhra Pradesh, Haryana, Madhya Pradesh and Tamil Nadu are the major cotton producer's states in India. The plant of GOI's is located in one of the cotton producing belt of Pandhurna (Madhya Pradesh) in India. The presence of GOI's in cotton producing region results in benefit derived from lower logistics expenditure (both on transportation and storage), easy availability and procurement of raw materials at effective price. Pandhurna, Chindawara (Madhya Pradesh) based GOPAL was formed as a proprietorship firm in 1991 by Mr Gopal Paliwal, he has experience of 26 years in this industry and looks after production process in the firm. GOI is engaged in processing and trading of cotton seeds oil and cotton oil cake which is also used in Cattle industry. The firm is having installed capacity of 1250 Metric Tonnes per Day (MTPD); however it utilizes 500 MTPD. The firm purchases raw material from local market, Andhra Pradesh and Maharashtra and supplies its products mainly to Gujarat and Rajasthan. GRAFFITI (INDIA): CARE Maintains D Rating in Not Cooperating ------------------------------------------------------------ CARE Ratings said the rating for the bank facilities of Graffiti (India) Private Limited (GIPL) continues to remain in the 'Issuer Not Cooperating' category. Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long-term Bank 12.00 CARE D; Issuer not co- Facilities operating; Based on Best Available Information Short-term Bank 3.00 CARE D; Issuer not co- Facilities operating; Based on Best Available Information Detailed Rationale & Key Rating Drivers CARE had, vide its press release dated March 9, 2018, placed the rating(s) of GIPL under the 'issuer non-cooperating' category as GIPL had failed to provide information for monitoring of the ratings for the rating exercise as agreed to in its Rating Agreement. GIPL continues to be non-cooperative despite repeated requests for submission of information through phone calls and letter/email-s dated January 11, 2019, January 24, 2019, April 5, 2019 and April 18, 2019. In line with the extant SEBI guidelines, CARE has reviewed the ratings on the basis of the best available information which however, in CARE's opinion is not sufficient to arrive at a fair rating. 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 March 09, 2018, the following were the rating strengths and weaknesses: Key Rating Weaknesses Ongoing delays in debt servicing: GIPL has been irregular in servicing its debt obligation due to weak liquidity position of the company. GIPL is engaged in trading of designer ceramic glazed tiles under brand name of “Graffiti”, “Harmony” and “Canvas”. GIPL procures ceramic tiles (semi-finished goods) from ceramic manufacturers located at Morbi in Rajkot district of Gujarat (ceramic hub) and designing is outsourced to its associate concern namely Shree Ambica Industries. GIPL sells through its established marketing network covering more than 18 states with total 621 dealers, sub dealers & distributors. HIRAKUD INDUSTRIAL: Insolvency Resolution Process Case Summary -------------------------------------------------------------- Debtor: Hirakud Industrial Works Ltd Hirakud Industrial Works at Hirakud Dist: Sambalpur 768016 Insolvency Commencement Date: June 4, 2019 Court: National Company Law Tribunal, Cuttack Bench Estimated date of closure of insolvency resolution process: December 3, 2019 Insolvency professional: CS Ananda Rao Korada Interim Resolution Professional: CS Ananda Rao Korada Flat No. 3, 400B/2F, NSC Bose Road Kolkata 700047, West Bengal E-mail: raoka55@gmail.com - and - Flat 702, Shaptami Upohar Luxury Complex Panchsayar Road Kolkata 700094 E-mail: csananda.hirakudindustrial@ gmail.com Last date for submission of claims: June 17, 2019 HOTEL JALTARANG: CARE Assigns B- Rating to INR9.75cr LT Loan ------------------------------------------------------------ CARE Ratings has assigned rating to the bank facilities of Hotel Jaltarang Private Limited (HJPL), as: Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long-term Bank Facilities 9.75 CARE B-; Stable Assigned Detailed Rationale & Key Rating Drivers The rating assigned to the bank facilities of HJPL is constrained by weak financial risk profile, working capital intensive nature of operations albeit lean operating cycle and presence in competitive, fragmented & seasonal industry. The rating, however, derive strength from experienced promoters in the hospitality industry and healthy profit margins. The ability of HJPL to increase the scale of operations, improve capital structure & debt coverage indicators along with liquidity position by efficiently managing working capital requirement are the key rating sensitivity. Detailed description of Key rating drivers Key rating Weakness Weak financial risk profile: The overall scale of operations remained small with total operating income stood in the range of INR6.11 crore to INR6.83 crore during FY16-FY18. Further, the tangible networth has also remained negative of INR2.56 crore as on March 31, 2018 due to losses incurred during past thereby limiting the financial flexibility of the company to a greater extent. Owing to the negative tangible networth, HJPL's capital structure remained distressed during past three balance sheet dates ended March 31, 2018. Moreover, the debt coverage indicators also remained weak marked by total debt to GCA and interest coverage at 31.71 times and 1.47 times respectively in FY18. Working capital intensive nature of operations albeit lean operating cycle: The operations of HJPL are working capital intensive in nature with high working capital requirements to fund its daily expenses. However, the operating cycle of the company is lean with low collection period and inventory holding due to walk-in customers and perishable nature of food commodities. However, the company primarily fund its working capital requirements through creditors and bank borrowing and hence, HJPL's working capital limits were almost fully utilized during the past 12 months ending February, 2019. Presence in competitive, fragmented & seasonal industry: HJPL operates in a highly competitive & fragmented restaurant industry with a large number of players engaged in the restaurant business. Moreover, the presence of many small & medium players in the vicinity of the religious places intensifies the already prevailing competition in the industry. Furthermore, the operations are seasonal in nature due to serving of mainly sea food with low occupancy during festivals & rainy season. Key rating Strengths Experienced promoters with over a decade of experience in the hotel business: The overall operations of HJPL are looked after by the promoters--Mr. Madhukar Sanjeeva Shetty along with his brothers Mr. Chandrakant Sanjeeva Shetty and Mr. Sharad Sanjeeva Shetty, who possess average experience of over 30 years in the hotel business through their association with other group companies. Hence, the extensive experience of the promoters enables them to establish strong marketing connects and service process excellence for HJPL. Healthy profit margins: The profit margins of HJPL remained healthy during past three years i.e. FY16-FY18 owing to hospitality services nature of operations. The PBILDT margin remained in the range of 39.23%-43.80% during the said period. However, owing to higher finance and depreciation cost, the PAT margin remained moderate in the range of 3.62%-6.93%. Liquidity Analysis: The liquidity position is marked by moderate current ratio and quick ratio at 1.46 times as on March 31, 2018 (1.48 times respectively as on March 31, 2017). Further, cash flow from operating activities stood positive at INR3.10 crore as on March 31, 2018. The average fund based working capital limits remained almost fully utilized during past 12 months ended April 2019. Moreover, free cash and bank balance was INR0.24 crore as on March 31, 2018 (vis-à-vis INR0.09 crore as on March 31, 2017). Hotel Jaltarang Private Limited (HJPL) was incorporated in 1987 as a private limited company and the management was taken over in 2002 by Shetty family. Currently Mr. Madhukar Sanjeeva Shetty, Mr. Chandrakant Sanjeeva Shetty and Mr. Sharad Sanjeeva Shetty are the directors of the company. HJPL is engaged in providing hospitality services viz. restaurant in the name of Gajalee located at Juhu in Vile Parle West, Mumbai. The said restaurant is specialized for serving sea food. HJPL has around 40 tables with 110 seating capacity along with a party hall for 25-30 people. IL&FS: Deadline for Claims Submission Extended to June 20 --------------------------------------------------------- BloombergQuint reports that the board of Infrastructure Leasing and Financial Services Ltd. has extended the deadline for submission of claims to June 20 following an order passed by the National Company Law Appellate Tribunal. The earlier deadline was June 5. In a release on June 10, IL&FS said the new board initiated a comprehensive claims management process for 70 IL&FS Group companies through the launch of pan-India public notices on May 22, BloombergQuint relates. "This extension is pursuant to the order passed by the NCLAT on May 29, 2019, wherein the court had extended the period for lenders to file their claims by June 20th, 2019," it added. According to the report, IL&FS said the claims process is being run in an effort to crystallise the financial and operational liabilities of IL&FS Group to facilitate distribution of proceeds from the resolution process, BloombergQuint relays. Grant Thornton India LLP is claims management adviser, BloombergQuint discloses. "Claims are being invited for an initial list of 70 identified companies which are currently part of an ongoing sale process or have been identified for sale in the first phase. "The other entities of the IL&FS group will be addressed appropriately in subsequent phases," IL&FS said. About IL&FS Infrastructure Leasing & Financial Services Limited (IL&FS) is an infrastructure development and finance company based in India. It focuses on the development and commercialization of infrastructure projects, and creation of value added financial services. The company operates in Financial Services, Infrastructure Services, and Others segments. As reported in the Troubled Company Reporter-Asia Pacific on Oct. 3, 2018, the Indian Express said that the government on Oct. 1, 2018, stepped in to take control of crisis-ridden IL&FS by moving the National Company Law Tribunal (NCLT) to supersede and reconstitute the board of the firm which has defaulted on a series of its debt payments. This was said to be an attempt to restore the confidence of financial markets in the credibility and solvency of the infrastructure financing and development group. JAWAHAR SAHAKARI: Ind-Ra Moves B+ Loan Rating to Non-Cooperating ---------------------------------------------------------------- India Ratings and Research (Ind-Ra) has migrated Jawahar Sahakari Soot Girni Ltd's (JSSG) bank loans ratings 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 B+ (ISSUER NOT COOPERATING)' on the agency's website. The details of the instruments and the rating actions are: -- INR286.26 mil. Bank Loans migrated to non-cooperating category with IND B+ (ISSUER NOT COOPERATING) rating; -- INR90 mil. Fund-based working capital facilities migrated to non-cooperating category with IND B+ (ISSUER NOT COOPERATING) rating; and -- INR25 mil. Non-fund-based working capital facilities migrated to non-cooperating category with IND B+ (ISSUER NOT COOPERATING) rating. Note: ISSUER NOT COOPERATING: The ratings were last reviewed on June 19, 2018. Ind-Ra is unable to provide an update as the agency does not have adequate information to review the ratings. COMPANY PROFILE JSSG was established in 1991 to manufacture cotton yarn. JAYMALA INFRASTRUCTURE: ICRA Keeps B+ Rating in Not Cooperating --------------------------------------------------------------- ICRA said the rating for the INR27.00 crore bank facilities of Jaymala Infrastructure Private Limited (JIPL or the company) continues to remain in the 'Issuer Not Cooperating' category. The rating is denoted as "[ICRA]B+(Stable) ISSUER NOT COOPERATING." Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long Term-Fund 27.00 [ICRA]B+ (Stable) ISSUER NOT Based-Term Loan COOPERATING; Rating continues to remain in the 'Issuer Not Cooperating' category ICRA has been trying to seek information from the entity so as to monitor its performance, but despite repeated requests by ICRA, the entity's management has remained non-cooperative. The current rating action has been taken by ICRA basis best available information on the issuers' performance. Accordingly, the lenders, investors and other market participants are advised to exercise appropriate caution while using this rating as the rating may not adequately reflect the credit risk profile of the entity. Jaymala Infrastructure Private Limited was incorporated in 2010 in order to undertake activities in hospitality (hotel chain facility) and renting of immovable properties. JIPL owns a land area at Chakan MIDC in Pune where the company has developed 1,22,112 sq ft of production facility and had let out the same to Benteler Automotive India Private Limited. Also, the company is setting up a 150-room 4-star category hotel in Navi Mumbai. While JIPL would develop the hotel, it will be operated through management agreement with Marriott Hotels (India) Private Limited which is a leading global hospitality chain. JET AIRWAYS: Stock Exchanges to Impose Trading Restrictions ----------------------------------------------------------- The Economic Times reports that shares of Jet Airways will be shifted to trade-for-trade segment from June 28 till further notice, the NSE and BSE said on June 13. The exchanges said this is a preventive surveillance measure. ". . . the security of the company shall be shifted from Rolling Segment to Trade-for-Trade Segment, wherein the settlement in the security will take place on gross basis with 100 per cent upfront margin and 5 per cent price band," the exchanges said, ET relays. Delivery of shares is compulsory in the trade-for-trade segment. According to the report, the circulars on both exchanges' website said they have been seeking clarification from the company in the recent past about various rumours floating in the market, but Jet has failed to provide prompt responses. The responses have also not been clear and satisfactory, the circulars said. ET relates that the company has said that it is not in a position to consider and approve the audited financial results for the financial year ended March 2019. Given these factors and the observations made by the auditor of Jet Airways, there are concerns regarding continuity of flow of information which is vital for appropriate price discovery in the stock, the exchanges, as cited by ET, said. The stock is set to be excluded from the futures and options segment with effect from June 28, ET notes. About Jet Airways Based in Mumbai, India, Jet Airways (India) Limited provided passenger and cargo air transportation services. It also provided aircraft leasing services. It operated flights to 66 destinations in India and international countries. As reported in the Troubled Company Reporter-Asia Pacific on April 22, 2019, Reuters said Jet Airways Ltd on April 17 halted all flight operations after its lenders rejected its plea for emergency funds, potentially bringing the curtains down on what was once India's largest private airline. Lenders of Jet Airways led by SBI are currently in the process of selling the airline to recover their dues of over INR8,400 crore, The Economic Times reported. Private equity firm TPG Capital, Indigo Partners, National Investment and Infrastructure Fund (NIIF) and Etihad Airways are in the race to buy a stake in the grounded Jet Airways, ET said. The total liabilities of the airline, including unpaid salaries and vendor dues, are nearly INR15,000 crore, Livemint disclosed. JHAWAR INTERNATIONAL: CARE Maintains D Rating in Not Cooperating ---------------------------------------------------------------- CARE Ratings said the rating for the bank facilities of Jhawar International (JIN) continues to remain in the 'Issuer Not Cooperating' category. Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long-term Bank 3.93 CARE D; Issuer not cooperating; Facilities Based on best available Information Short-term Bank 40.00 CARE D; Issuer not cooperating; Facilities Based on best available Information Detailed Rationale & Key Rating Drivers CARE had, vide its press release dated March 28, 2018, placed the rating(s) of JIN under the 'issuer non-cooperating' category as JIN had failed to provide information for monitoring of the rating for the rating exercise as agreed to in its Rating Agreement. JIN continues to be non-cooperative despite repeated requests for submission of information through e-mails, phone calls and an email dated April 19, 2019, April 22, 2019, May 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. Users of this rating (including investors, lenders and the public at large) are hence requested to exercise caution while using the above ratings. Detailed description of the key rating drivers At the time of last rating on March 28, 2018 the following were the rating strengths and weaknesses. Key Rating Weaknesses Ongoing delay in debt servicing: There is ongoing irregularity in servicing of debt obligation due to weak liquidity position of the firm. Surat-based (Gujarat) JIN was formed in 1996 as a partnership firm in the name of Jhawar International by Jhawar family. JIN is into the business of manufacturing of Printed fabrics, dye fabrics and fancy work. JIN is operating from its sole manufacturing plant located in Surat(Gujarat) with an installed capacity of manufacturing 16.8tonne of narrow fabrics and 1200 tonne of dyed multiple as on March 31, 2015. LEEL ELECTRICALS: CARE Maintains D Rating in Not Cooperating ------------------------------------------------------------ CARE Ratings said the rating for the bank facilities of LEEL Electricals Limited (LEEL) continues to remain in the 'Issuer Not Cooperating' category. Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long Term Bank 455.00 CARE D; Issuer not cooperating; Facilities- based on best available Fund Based information LT/ST Bank 595.00 CARE D; Issuer not cooperating; Facilities based on best available (Non-Fund Based) information Detailed Rationale & Key Rating Drivers CARE has been seeking information from LEEL to monitor the ratings vide e-mail communications dated May 17, 2019, May 15, 2019 and May 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 best available information which however, in CARE's opinion is not sufficient to arrive at a fair rating. CARE's rating on Leel Electricals 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 Key Rating Weaknesses Delays in debt servicing: CARE as part of its due diligence exercise interacts with various stakeholders of the company including lenders to the company and as part of this exercise has ascertained that there are devolvement of letter of credit for more than 30 days and the account has turned NPA. LEEL was incorporated in 1987 and operates in HVAC segment. It is engaged in the manufacturing of condenser and evaporator coils and contract manufacturing for Air Conditioners (ACs) for various brands. LEEL was also into retailing of ACs and consumer durable products like LCD/ LED TVs, washing machines, freezers, etc. The Company, however had sold its Consumer Durable Business comprising of business of importing, trading, marketing, exporting, distribution, sale of air conditioners, televisions, washing machines and other household appliances and assembling of televisions under the brand "LLOYD" and all of the rights, title, interest, licensees, contracts, assets, continuing employees, intellectual property including the brand, logo, trade mark "LLOYD" as a going concern on slump sale basis to Havells India Ltd. Pursuant to the transaction, the Company has also changed its name to 'LEEL Electricals Ltd.' LEEL has six manufacturing/ assembly units located at Rajasthan, Himachal Pradesh, Tamil Nadu, Haryana and Uttarakhand. On a consolidated basis, LEEL operates two subsidiaries, namely, Lloyd Coils Europe s.r.o (LCE) engaged in manufacturing of coils and finned pack heat exchangers and Noske Kaeser Company (NKC) which is engaged in engineering, manufacturing and providing system solutions and components for the transport industry in the fields of air conditioning, refrigeration, piping, fire-fighting, CBRN protection and related services. LML LIMITED: ICRA Maintains D Rating in Not Cooperating ------------------------------------------------------- ICRA said the rating of INR125.00-crore preference share programme of LML Limited (LML) continues to remain under 'Issuer Not Cooperating' category. The rating is denoted as "[ICRA]D ISSUER NOT COOPERATING". Amount Facilities (INR crore) Ratings ---------- ----------- ------- Preference Share 125.00 [ICRA]D ISSUER NOT Capital COOPERATING; Rating continues to remain under 'Issuer Not Cooperating' category ICRA has been trying to seek information from the entity so as to monitor its performance, but despite repeated requests by ICRA, the entity's management has remained non-cooperative. The current rating action has been taken by ICRA basis best available/dated/ limited information on the issuers' performance. Accordingly the lenders, investors and other market participants are advised to exercise appropriate caution while using this rating as the rating may not adequately reflect the credit risk profile of the entity. LML Limited (LML) was promoted in 1972 as Lohia Machines Limited by the Singhania family to manufacture machinery for the synthetic fibres industry. Later, it diversified into production of 100 cc scooters, in technical collaboration with Piaggio Vespa, of Italy in 1984. Piaggio later took up 23.5% equity stake, which it later divested in favour of the Indian promoters pursuant to the settlement reached following certain legal disputes, which were settled out of court. Subsequently, the company entered into technical collaboration with Daelim Motor Company, South Korea (DMC) to set up a small capacity for manufacturing of four-stroke motorcycles. Following a strike by the workers, LML had declared a lock-out at its factory in Kanpur with effect from March 7, 2006. The lock-out remained in place for over a year and the same was lifted only in April 2007 pursuant to a tripartite agreement reached between the company, the Trade Union and the Labour Department of Government of Uttar Pradesh. The company, filed a petition on May 22, 2017 under section 10 of the Insolvency & Bankruptcy Code, 2016 with National Company Law Tribunal (NCLT), Allahabad bench. The company is under Corporate Insolvency Resolution Process and the net worth of the company has been fully eroded and its current liabilities exceed its current assets as on December 31, 2017. MILIND PULSES: ICRA Maintains D Rating in Not Cooperating --------------------------------------------------------- ICRA said the ratings for INR5.00 crore bank facilities of Milind Pulses continue to remain under 'Issuer Not Cooperating' category. The rating is denoted as "[ICRA]D; ISSUER NOT COOPERATING". Amount Facilities (INR crore) Ratings ---------- ----------- ------- Cash Credit 5.00 [ICRA]D; ISSUER NOT COOPERATING; Rating continues to remain under 'Issuer Not Cooperating' category ICRA has been trying to seek information from the entity so as to monitor its performance, but despite repeated requests by ICRA, the entity's management has remained non-cooperative. The current rating action has been taken by ICRA basis best available/dated/limited information on the issuers' performance. Accordingly, the lenders, investors and other market participants are advised to exercise appropriate caution while using this rating as the rating may not adequately reflect the credit risk profile of the entity. Milind Pulses started its operations in 2000-01 and is engaged in trading and manufacturing of Tur Dal, Lakhodi Dal and Chana Dal driven primarily by its healthy demand. The proprietor- Mr. Milind and his father Mr. Vijay have an experience of over 12 years in the pulses processing industry. The firm has a combined production capacity of 18,000 MTPA or 600 quintals of Tur Dal, Lakhodi Dal and Chanal Dal with the manufacturing facility located at Nagpur. MM PATEL: CARE Downgrades Rating on INR13.84cr Loan to D -------------------------------------------------------- CARE Ratings revised the ratings on certain bank facilities of MM Patel Public Charitable Trust (MMPPCT), as: Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long-term Bank 13.84 CARE D Revised from CARE BB; Facilities Stable Long-term bank 77.25 CARE C; Stable Revised from Facilities CARE BB; Stable Short-term bank facilities 14.00 CARE A4 Reaffirmed Detailed Rationale & Key Rating Drivers The revision of the rating assigned to the bank facilities of MMPPCT factors in delays in servicing interest of one of its term loan due to its stressed liquidity position. The rating however continues to derive strength from the resourceful trustee. Going forward, the ability of the entity to timely repay the debt obligations is the key rating sensitivity. Detailed description of the key rating drivers Key Rating Weakness Delays in interest obligation: As per banker's feedback there are delays in interest servicing of one of the term loan. Liquidity: Liquidity position of the company deteriorated as indicated by current ratio of 0.71x as on March 31, 2018 mainly on account of increase in current maturities for repayment of unsecured loan. The trust had a free cash balance of INR 0.99 crores as on March 31, 2018. The CC utilization during FY18 stood in the range of 70-75%. M.M. Patel Public Charitable Trust was established in the year 2008 by Mr Bipinbhai M. Patel and his family. MMPPCT is a public charitable trust which is currently managing a 520-beded hospital, namely, 'Ashwini Rural Hospital' at Solapur and also operates a medical college- namely 'Ashwini Rural Medical College' which is the first rural medical college in Solapur district, Maharashtra. The medical college offers MBBS and post graduate courses. NANI RESORTS: CARE Lowers Rating on INR20.45cr Loan to D -------------------------------------------------------- CARE Ratings revised the ratings on certain bank facilities of Nani Resorts and Floriculture Private Limited (NRFPL), as: Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long term Bank 20.45 CARE D Revised from Facilities CARE BB; Stable; Issuer Not Cooperating Detailed Rationale & Key Rating Drivers The revision in the rating assigned to the bank facilities of NRFPL takes into consideration ongoing delays in debt servicing by the company on account of stretched liquidity position. Detailed description of the key rating drivers Key Rating Weaknesses Delays in servicing of debt obligations: On account of overall subdued demand scenario in the real estate market, the company has been able to garner lower than envisaged amount of project collections in its ongoing residential project named Aalayas based in Sector-102, Dwarka Expressway, Gurgaon under Haryana affordable housing policy, 2013. This has led to a mismatch between project receipts vis a vis the debt repayment obligations, leading to delays in debt servicing. Concentration risk with only one project under execution: As the company is currently involved in the execution of a single project, it remains exposed to concentration risk. However, the company is planning to launch other projects in Haryana in upcoming years. Subdued real estate scenario: With the on-going economic conditions, the real estate industry is currently facing issues on many fronts, including subdued demand, curtailed funding options, rising costs, restricted supply due to delays in approvals, etc. thereby resulting in stress on cash flows of developers. The industry has seen low demand in the recent past, primarily due to factors like sustained high level of inflation leading to high interest rates and adverse impact on the buying power and affordability for the consumers. Key Rating Strengths Experienced promoters and management: Nani Resorts & Floriculture Pvt. Ltd. (NRFPL) is engaged in real estate development in Delhi and NCR region. The company is promoted by Mr. M.S. Mittal having more than 15 years of experience in industry, whereby, he has executed about 11 commercial and residential projects in NCR region. Further, the promoter has also constructed 4 Star Hotel project 'Ramada Gurgaon Central' in Gurgaon which is being operational since 2013 under tie-up with international hotel chain 'Ramada Hotel'. Satisfactory project construction status: The company is developing an affordable group housing project 'Aalayas' at Sec-102, Gurgaon. As on Mar 31, 2019, about INR 122 cr has been incurred out of the total project cost of INR 128 cr i.e. 93% of the total project cost. Moreover, the company has incurred INR 58 cr out of the total construction cost of INR 63 cr till the same period i.e. about 92% of the construction cost has been incurred which demonstrates advanced stages of construction, thereby reducing the project execution risk. Healthy booking status: Till Mar 31, 2019, the company has sold ~98% (94% till March 31, 2018) of the total saleable of the project i.e. 3.95 lsf being sold out of the total saleable area of 4 lsf for a total sale value of 170.61 cr. Out of the same, the company has received INR154 cr, representing ~90% of the total sale value. The average monthly collection from April'18 to Feb'19 stood at INR 3.52 Cr. Liquidity The liquidity profile of JMHL remains weak. Due to mismatch between project receipts vis a vis the debt repayment obligations and pending project cost to be executed, the liquidity of JMHL remains constrained. Nevertheless, the company maintained closing cash and bank balance of INR2.77cr as on March 31, 2019. Nani Resorts & Floriculture Pvt. Ltd. (NRFPL), incorporated in 1999 is engaged in real estate development in Delhi and NCR region. The company is promoted by Mr. M.S. Mittal. The company is currently developing an affordable group housing project named "Aalayas" in Sector-102, Dwarka Expressway, Gurgaon under Haryana affordable housing policy, 2013. Till March 31, 2019, the company has already incurred 93% of the total project cost i.e. INR122cr out of the total project cost of INR132cr. NIGAM INDUSTRIES: CARE Maintains B+ Rating in Not Cooperating ------------------------------------------------------------- CARE Ratings said the rating for the bank facilities of Nigam Industries (NIS) continues to remain in the 'Issuer Not Cooperating' category. Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long-term Bank 6.40 CARE B+; Stable; Issuer not Facilities co-operating; Based on Best Available Information Detailed Rationale & Key Rating Drivers CARE had, vide its press release dated March 26, 2018, placed the rating(s) of NIS under the 'issuer non-cooperating' category as NIS had failed to provide information for monitoring of the rating for the rating exercise as agreed to in its Rating Agreement. NIS continues to be non-cooperative despite repeated requests for submission of information through phone calls and letter/email-s dated January 11, 2019, January 24, 2019, April 5, 2019 and April 18, 2019. In line with the extant SEBI guidelines, CARE has reviewed the ratings on the basis of the best available information which however, in CARE's opinion is not sufficient to arrive at a fair rating. 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 March 26, 2018, the following were the rating strengths and weaknesses: Key Rating Weaknesses Small scale of operations: During FY16 (refers to the period April 1 to March 31), NIS reported TOI of INR4.76 crore with PAT of INR0.15 crore. Till November 30, 2016, NIS had achieved turnover of INR7.59 crore out of which INR6.10 crore was from fabric processing and balance from processing and trading of chemicals. On-going debt-funded capex: NIS was implementing a project for dyeing of fabrics on job work basis at a total cost of INR7.35 crore with a proposed debt to equity mix of 2.97 times. Till December 2016, NIS had incurred 80% of the total cost. Presence in highly fragmented and competitive chemical as well as textile industry along with partnership nature of constitution: NIS is currently into processing as well as trading of chemicals and from July 2016 it has also commenced operations of dyeing of fabrics. The chemical industry is highly fragmented in nature with presence of huge number of organized as well as unorganized players in it which intensifies competition. Furthermore, NIS being a partnership firm is exposed to inherent risk of partners' capital being withdrawn at time of personal contingency. Key Rating Strengths Experienced partners albeit no relevant experience in fabric processing industry: The key partner Mr Rameshwar Yadav has more than two decades of experience in the chemical industry. He also promotes other entities of Nigam Group such as Nigam Pharmachem Industries, Shiva Dyestuff Pvt. Ltd. and Shree Shraddha Chemicals Pvt Ltd. Fiscal benefits from government: For dyeing unit, as per Amended- Technology Up-gradation Fund Scheme (TUFS), NIS is eligible for 10% capital subsidy on eligible plant and machineries purchased. NIS will also get 7% interest subsidy and 15% capital subsidy (maximum up to 25 lakh) from state government. Comfortable capital structure and debt coverage indicators albeit expected to deteriorate due to ongoing capex: The capital structure of NIS stood comfortable marked by overall gearing ratio of 0.92 times as on March 31, 2016 which improved from 1.03 times as on March 31, 2015. Debt coverage indicators also remained at comfortable level. However, as NIS was undertaking a project of establishing another unit for dyeing of fabrics, both overall gearing and debt protection metrics were envisaged to deteriorate going forward. Moderate liquidity position: The operating cycle of NIS stood comfortable at 34 days during FY16. CC utilization remained around 60% during past 12 months ended on November 2016. NIS based in Ankleshwar (Gujarat), was established in 1989 by three partners Mr Ramehwar Yadav, Mr Kameshwar Yadav and Mr Ravindra Yadav. NIS is engaged into processing and trading of chemicals which find application in various industries such as pharmaceutical, agriculture, fertilizer etc. on job work basis. It has an installed capacity of 4100 metric tons per annum (MTPA) for chemical processing as on March 31, 2016. NIS was undertaking a project of INR7.35 crore to establish another unit for dyeing of fabrics on job work basis with a proposed debt to equity mix of 2.97 times. PRINT PLUS: Insolvency Resolution Process Case Summary ------------------------------------------------------ Debtor: Print Plus Pvt. Ltd. Unit No. 122, Shah & Nahar Industrial Estate Bldg A-2 Dhanraj Mill Compound Lower Parel (W) Mumbai MH 400013 Insolvency Commencement Date: June 10, 2019 Court: National Company Law Tribunal, Mumbai Bench Estimated date of closure of insolvency resolution process: December 6, 2019 Insolvency professional: CA Naren Sheth Interim Resolution Professional: CA Naren Sheth 1014-1015, Prasad Chamber Tata Road No. 1, Opera House Charni Road (East) Mumbai 400004 Mobile: 09821133426 Tel.: 02266322870 E-mail: mkindia58@gmail.com nvsheth@mkindia.com Last date for submission of claims: June 23, 2019 RAJIV SWAGRUHA: NCLT Asks Group on IN343cr Dues to Shirke Group --------------------------------------------------------------- The Times of India reports that the National Company Law Tribunal (NCLT), Hyderabad, has asked Rajiv Swagruha Housing Corporation Ltd to come clean by June 18 on why it has changed its stand on the payment of INR343-crore dues to house-building firm BG Shirke Group of Companies. It also sought to know why the housing corporation has been dodging a resolution either through a corporate insolvency resolution process or an out-of-court settlement, the report says. According to TOI, Tribunal judge K Anantha Padmanabha Swamy gave this directive while hearing a plea by Shirke Group against the corporation. TOI says N Ashwani Kumar, counsel for Shirke Group, told the tribunal that houses were built in tune with the contract entrusted to them by the corporation. Senior counsel DV Sitharam Murthy, who appeared for Shirke Group, said houses were completed as envisaged under the housing scheme for the poor and all the houses were delivered to the government in 2014 itself, the report relays. Murthy said the bills were accepted and the corporation had admitted INR343 crore as dues to Shirke company, the report adds. Since August 2018, the corporation took 18 adjournments to settle the issue with the company. "But, this week, the corporation has changed its stand and contended for the first time that the dues are disputed and it intends to contest the petition on merits," the report quotes Mr. Murthy as saying. Wondering what prevented the state government from taking this stand all these months, the judge expressed unhappiness with the conduct of the corporation, TOI says. "After taking 18 adjournments on the grounds of settling the case amicably, taking a u-turn is contrary to the settled principles of law," he said. TOI says the time consumed by the corporation has defeated the provisions of the insolvency and bankruptcy code which stipulates that any petition filed shall be disposed of within 180 days and not beyond 270 days. "The corporation's requests for adjournments were accommodated only on the ground of settling the issue amicably," the report quotes Murthy as saying. The case has been posted to June 18 for further hearing, TOI says. RSG DEVELOPERS: ICRA Maintains 'B' Rating in Not Cooperating ------------------------------------------------------------ ICRA said the rating for the INR7.50 crore bank facilities of RSG Developers Private Limited continues to remain in the 'Issuer Not Cooperating' category. The ratings are denoted as "[ICRA] B (Stable); ISSUER NOT COOPERATING". Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long Term-Fund 5.50 [ICRA]B (Stable); ISSUER NOT Based- CC COOPERATING; Rating continues to remain in the 'Issuer Not Cooperating' category Long Term-Fund 2.00 [ICRA]B (Stable); ISSUER NOT Based - TL COOPERATING; Rating continues to remain in the 'Issuer Not Cooperating' category ICRA has been trying to seek information from the entity so as to monitor its performance, but despite repeated requests by ICRA, the entity's management has remained non-cooperative. The current rating action has been taken by ICRA basis best available/dated/ limited information on the issuers' performance. Accordingly, the lenders, investors and other market participants are advised to exercise appropriate caution while using this rating as the rating may not adequately reflect the credit risk profile of the entity. RSG Developers Private Limited (RSG) was founded in 2004 by Mr. Rajeev Sharma. The company is based out of Noida (Uttar Pradesh) and is initially involved in civil construction business of multiple roads and building construction projects for public sector clients. However, currently the company is engaged into construction of residential and commercial projects for private sector client. Apart from construction the company also undertakes operations and maintenance projects. In FY2017, on a provisional basis, the company reported a net profit of INR0.76 crore on an operating income of INR21.75 crore, as compared to a net profit of INR0.26 crore on an operating income of INR21.95 crore in the previous year. SHREE GOKULESH: CARE Maintains B Rating in Not Cooperating ---------------------------------------------------------- CARE Ratings said the rating for the bank facilities of Shree Gokulesh Rice Mill (SGRM) continues to remain in the 'Issuer Not Cooperating' category. Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long-term Bank 6.56 CARE B; Stable; Issuer Not Facilities Cooperating; Based on Best available information Detailed Rationale & Key Rating Drivers CARE had, vide its press release dated March 5, 2018, placed the rating(s) of SGRM under the 'issuer non-cooperating' category as SGRM had failed to provide information for monitoring of the rating for the rating exercise as agreed to in its Rating Agreement. SGRM continues to be non-cooperative despite repeated requests for submission of information through e-mails, phone calls and an email dated March 4, 2019, April 1, 2019, April 5, 2019, April 10, 2019, April 16, 2019, April 18, 2019. 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. 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 March 5, 2018, the following were the rating strengths and weaknesses: Key rating weaknesses Thin profit margins, leveraged capital structure, weak debt coverage indicators: The PBILDT margin declined by 46 bps and stood low at 2.78% during FY16 (refers to the period April 1 to March 31) on account of increase in raw material cost. The PAT margin also remained thin during FY16 owing to high interest costs and low value addition nature of operations. The capital structure marked by overall gearing stood leveraged on the back of low net worth base and high level of debt. Furthermore, with low cash accruals, debt coverage indicators also stood weak marked by total debt to GCA of 18.49 times as on March 31, 2016. Moderate liquidity position: Liquidity position remained moderate marked by current ratio of 1.48 times as on March 31, 2016. Cash and Bank balance remains low at INR0.60 crore as on March 31, 2016. Cashflow from operating activity remained at INR1.29 crore as on March 31, 2016. Presence into the fragmented agro-processing industry along with partnership nature of its constitution: SGRM generates its revenue from processing of rice and is exposed to inherent risks associated with agro-climatic conditions and seasonality of agro product. SGRM being a partnership firm is exposed to inherent risk of partners' capital being withdrawn at time of personal contingency and firm being dissolved upon the death/retirement/insolvency of key partners. Risk associated with on-going debt-funded capex: SGRM is currently undertaking debt-funded capex, thus SGRM exposed to risk associated with implementation and stabilisation of operation for ongoing capex. Key rating strengths Experienced and resourceful promoters: The operation of SGRM is currently managed by Mr Minesh H. Patel, Mr Raghav J. Patel, and Mr Tejas K. Patel. All the partners collectively look after all day-to-day operations of the firm. Mr Minesh Patel possess more than decade of experience in the industry. Proximity to paddy-growing areas: SGRM's plant is located at Ahmedabad, Gujarat, which is in proximity to the paddy-growing areas of the country. Established in the year 2004, Ahmedabad-based Shree Gokulesh Rice Mill (SGRM) is a partnership firm engaged in the processing of non-basmati rice. Key partners include Mr Minesh H. Patel, Mr Raghav J. Patel, and Mr Tejas K. Patel who manages the day-to-day operations. As on March 31 2016, it had a total installed capacity of 36,000 Metric Tonne per Annum (MTPA) for paddy processing and operates through its sole manufacturing facility at Jetalpur (Ahmedabad). SGRM procures paddy from local traders and supplies its products in pan India levels through brokers. SGRM has base of 150 brokers in pan India level. However, it supplies mainly to Gujarat, Maharashtra, Karnataka and Rajasthan. SGRM sells its products under three brands named 'Galaxy', 'Butterfly' and 'Gokulesh'. SHRI MARUTINANDAN: CARE Maintains B Rating in Not Cooperating ------------------------------------------------------------- CARE Ratings said the rating for the bank facilities of Shri Marutinandan Oil Industries (SMOI) continues to remain in the 'Issuer Not Cooperating' category. Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long-term Bank 5.41 CARE B; Stable; Issuer not Facilities Cooperating Based on best Available information Detailed Rationale & Key Rating Drivers CARE had, vide its press release dated March 1, 2018, placed the rating(s) of SMOI under the 'issuer non-cooperating' category as SMOI had failed to provide information for monitoring of the rating for the rating exercise as agreed to in its Rating Agreement. SMOI continues to be non-cooperative despite repeated requests for submission of information through phone calls and an email dated April 19, 2019, April 22, 2019, May 2, 2019, May 14, 2019. 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. 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 March 1, 2018, the following were the rating strengths and weaknesses: Key Rating Weaknesses Nascent stage of operation along with weak financial risk profile mark by thin profitability, leveraged capital structure and weak debt coverage indicators: The operation of SMOI is into nascent stage, as the firm has commenced its operation from November 2015 and reported TOI of INR3.65 crore during FY16 (refers to the period April 1 to March 31). Profitability of SMOI remained thin on account of limited value addition and volatile raw material prices. On account of high debt level as compared to tangible net worth, capital structure of the firm stood leveraged. As a result of thin profitability along with high debt level, the debt coverage indicators also stood weak. Modest liquidity position: Liquidity position of the SMOI stood modest marked by below unity current ratio as on March 31, 2016. Further, cash flows from operating activity remained at INR 0.15 crore while cash and bank balance remained at INR 0.13 crore as on March 31, 2016. Presence in highly fragmented industry with limited value addition SMOI is operating in highly fragmented industry having presence of large number of small and medium scale units due to low technological and financial investment requirement which results into fragmented nature of the industry as well as intense competition from the large domestic integrated players. Dependence on agro climatic condition and seasonality associated with the availability of commodities: Being agro-based products, the availability of oilseeds is susceptible to agro-climatic vagaries, pests/diseases, which may affect the crop output and quality. Vulnerability of its profit margins to fluctuation in raw material prices: The major raw materials for SMOI are agro-commodities namely cotton seed, which prices have been volatile in nature and depend upon factors like area under cultivation, yield for the year, international demand supply scenario, government regulation and inventory carry forward of last year. Hence, any adverse fluctuation in the raw material price will have direct impact on the operating margins of SMOI. Partnership nature of constitution: SMOI being a partnership firm is exposed to inherent risk of partners' capital being withdrawn at time of personal contingency and firm being dissolved upon the death/retirement/insolvency of key partners. Key rating strengths Experienced partner: Mr Govindbhai Patel is the key partner of SMOI, who possesses more than 30 years of experience in the industry and looks after overall operation of the firm. Proximity to raw material source: Furthermore, SMOI's presence in the cotton-producing region results in benefit derived from a lower logistic expenditure (both on transportation and storage), easy availability and procurement of raw materials at effective prices and consistent demand for finished goods resulting in a sustainable and clear revenue visibility. SMOI, a Kadi-based (Gujarat) partnership firm, was established in 2015 by four partners, namely, Mr Govindbhai Patel, Ms Chandrikaben Patel, Ms Nishaben Patel and Ms Jayshriben Patel. Mr Govindbhai possesses vast experience in the industry and looks after overall management of the firm. The firm is engaged into cotton seed crushing business. SMOI commenced its operation from November 2015 and operates from its manufacturing unit located in Kadi (Gujarat) with an installed crushing capacity of 25,920 MTPA as on March 31, 2016. SMOI procures material from local ginners and sells cotton seed oil to local refineries and oilcake to local traders. SONACHI INDUSTRIES: Ind-Ra Cuts LT Issuer Rating to D, Not Coop. ---------------------------------------------------------------- India Ratings and Research (Ind-Ra) has downgraded Sonachi Industries Ltd's (SIL) Long-Term Issuer Rating to 'IND D (ISSUER NOT COOPERATING)' from 'IND BB (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. Therefore, investors and other users are advised to take appropriate caution while using these ratings. The rating will now appear as 'IND D (ISSUER NOT COOPERATING)' on the agency's website. The instrument-wise rating actions are: -- INR142.5 mil. Fund-based facility (Long-term/Short-term) downgraded with IND D (ISSUER NOT COOPERATING) rating; and -- INR7.5 mil. Non-fund-based facility (Short-term) downgraded 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 downgrade reflects delays in debt servicing by SIL, the details of which are not available. RATING SENSITIVITIES Positive: Timely debt servicing for at least three consecutive months would be positive for the ratings. COMPANY PROFILE Incorporated in 2006, SIL was engaged in the trading of pesticides. In 2010, the company began manufacturing and distribution of pesticides, micronutrients, biocides, biochemical and water treatment chemicals. SWASTIK COAL: CARE Maintains D Rating in Not Cooperating -------------------------------------------------------- CARE Ratings said the rating for the bank facilities of Swastik Coal Corporation Pvt. Ltd. (SCCPL) continues to remain in the 'Issuer Not Cooperating' category. Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long Term Bank 55.00 CARE D; Issuer Not Cooperating; Facilities Based on best available Information Short Term Bank 320.00 CARE D; Issuer Not Cooperating; Facilities Based on best available Information Detailed Rationale & Key Rating Drivers CARE, vide press release dated March 9, 2018, had placed the rating of SCCPL under the 'Issuer Non-cooperating' category as the company had failed to provide information for monitoring of the ratings and had not paid the surveillance fees for the rating exercise as agreed to in its Rating Agreement. SCCPL continues to be non-cooperative despite repeated requests for submission of information through phone calls and a letter dated May 22, 2019. 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. 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 for the bank facilities of Swastik Coal Corporation Pvt. Ltd. (SCCPL) take into account the ongoing delays in servicing of its debt obligations due to its stressed liquidity. Detailed description of the key rating drivers At the time of last rating on March 9, 2018, the following were the rating strengths and weaknesses (updated based on the best available information): Key Rating Weaknesses Ongoing delays in servicing of debt obligations: There are ongoing delays in servicing of SCCPL's debt obligations due to its stressed liquidity. Swastik group includes three companies operating in similar line of coal trading & transport businesses viz. Swastik Coal Corporation Pvt. Ltd. (SCCPL), Arka Carbon Fuel Pvt. Ltd. (ACFPL) & Shree Ganpatlal Onkarlal Agarwal & Co. (SGOAC). CARE has taken a combined approach of these three companies for arriving at ratings of SCCPL, ACFPL & SGOAC due to common promoters & management and strong operational & financial linkages among the group entities in coal trading business. Swastik group includes three companies operating in similar line of coal trading & transport businesses viz. Swastik Coal Corporation Pvt. Ltd. (SCCPL), Arka Carbon Fuel Pvt. Ltd. (ACFPL) & Shree Ganpatlal Onkarlal Agarwal & Co. (SGOAC), together referred to as Swastik Group (SG). We have taken a combined approach of these three companies for arriving at ratings of SCCPL, ACFPL & SGOAC due to common promoters & management and strong operational & financial linkages among the group entities in coal trading business. V HOTELS: Insolvency Resolution Process Case Summary ---------------------------------------------------- Debtor: V Hotels Limited Registered and Corporate office: Chander Mukhi Building Basement Behind the Oberoi Hotel, Nariman Point Mumbai 400021 Insolvency Commencement Date: May 31, 2019 Court: National Company Law Tribunal, Mumbai Bench Estimated date of closure of insolvency resolution process: November 27, 2019 (180 days from commencement) Insolvency professional: Anish Niranjan Nanavaty Interim Resolution Professional: Anish Niranjan Nanavaty 2a/208, Raheja Classique New Link Road, Andheri (W) Mumbai, Maharashtra 400053 E-mail: anish.nanavaty.irp@gmail.com - and - Deloitte Touche Tohmatsu India LLP 27th Floor, Tower 3 Indiabulls Finance Center Senapati Bapat Marg Mumbai 400013 E-mail: invhlip@deloitte.com Last date for submission of claims: June 18, 2019 ===================== N E W Z E A L A N D ===================== AVANTI RMBS 2019-1: Fitch to Rate Class E Notes 'BB(EXP)sf' ----------------------------------------------------------- Fitch Ratings has assigned expected ratings to Avanti RMBS 2019-1 Trust's mortgage-backed pass-through floating-rate bonds. The issuance consists of notes backed by a pool of first-ranking New Zealand residential prime and non-conforming, full- and low-documentation mortgage loans originated by Avanti Finance Limited. The notes will be issued by The New Zealand Guardian Trust Company Limited in its capacity as trustee of Avanti RMBS 2019-1 Trust in respect of the Avanti RMBS 2019-1 Trust, which is a separate and distinct trust created in accordance with a master trust deed. At the 28 May 2019 cut-off date, the asset pool totalled NZD200 million and consisted of 589 obligors with a weighted-average (WA) unindexed loan/value ratio (LVR) of 67.5%. KEY RATING DRIVERS Operational Risk: Avanti is a non-bank financial institution with over 25 years of experience in originating, underwriting, servicing and special servicing in New Zealand. Fitch reviewed Avanti's processes and found these to be mostly in line with that of Fitch-rated Australian non-bank lenders. In some instances, Avanti's underwriting criteria and past arrears performance differed from other prime non-bank lenders, therefore, Fitch applied a lender adjustment of 1.05x to address the possible difference in foreclosure frequency. Asset Analysis: The 'AAAsf' WA foreclosure frequency of 20.5% is driven by the WA unindexed LVR of 67.5% and, under Fitch's methodology, investment loans of 19.6% and non-conforming loans of 43.8%. The 'AAAsf' WA recovery rate of 51.0% is driven by the portfolio's WA indexed scheduled LVR of 67.5% and the portfolio 'AAAsf' WA market value decline of 60.8%. Structure Analysis: Structural features include a liquidity facility sized at 1.5% of the invested note balance and subject to a floor of NZD100,000. The Class B to F notes pay interest based on the notes' stated balance. Fitch's ratings reflect the timely and ultimate payment of interest and its cash flow model addresses the risk that interest may be not be recovered in scenarios where there are charge-offs. This is more conservative than transaction documentation. All classes of notes can withstand all relevant Fitch cashflow modelling stresses. Macroeconomic Factors: Fitch expects stable mortgage performance, supported by sustained economic growth in New Zealand, which is high compared with many advanced economies. Fitch forecasts GDP growth of 2.8% for 2019. Mortgage performance will also be supported by high net migration and a falling unemployment rate. RATING SENSITIVITIES Unanticipated increases in the frequency of defaults and loss severity on defaulted receivables could produce loss levels higher than Fitch's base case and are likely to result in a decline in credit enhancement and remaining loss-coverage levels available to the notes. Decreased credit enhancement may make certain note ratings susceptible to negative rating action, depending on the extent of the coverage decline. Hence, Fitch conducts sensitivity analysis of the ratings by stressing the transaction's initial base-case assumptions. Expected impact on note ratings of increased defaults: Notes: A1 / A2 / B / C / D / E Expected Rating: AAAsf / AAAsf / AAsf / Asf / BBBsf / BBsf Increase defaults by 15%: AA+sf / AA+sf / AA-sf / A-sf / BBB-sf / BB-sf Increase defaults by 30%: AAsf / AAsf / A+sf / BBB+sf / BB+sf / B+sf Expected impact on note ratings of decreased recoveries: Notes: A1 / A2 / B / C / D / E Expected Rating: AAAsf / AAAsf / AAsf / Asf / BBBsf / BBsf Reduce recoveries by 15%: AA+sf / AA+sf / AA-sf / BBB+sf / BBsf / Bsf Reduce recoveries by 30%: AAsf / AAsf / Asf / BBBsf / ********* 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 ***