/raid1/www/Hosts/bankrupt/TCRAP_Public/200210.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
Monday, February 10, 2020, Vol. 23, No. 29
Headlines
A U S T R A L I A
CANEFLIGHT PTY: First Creditors' Meeting Set for Feb. 14
COCKBURN CENTRAL: First Creditors' Meeting Set for Feb. 17
DECIMAL SOFTWARE: First Creditors' Meeting Set for Feb. 13
SCOOTI PTY: First Creditors' Meeting Set for Feb. 17
TOTAL SCOOTER: First Creditors' Meeting Set for Feb. 17
WALKER GRAPHICS: Goes Into Voluntary Administration
C H I N A
BAOSHANG BANK: Future Could Hinge on a Shareholder Vote
CBAK ENERGY: Agrees w/ Atlas Sciences to Swap $100K Note for Equity
IDEANOMICS INC: Qingdao Agrees to Invest RMB200 Million
NEUROMETRIX INC: Incurs $3.8M Net Loss for Year Ended Dec. 31, 2019
[*] Coronavirus Outbreak Could Hit Airlines, Hotels, Gaming Firms
H O N G K O N G
HONG KONG AIR: To Cut 400 Jobs, Operations Amid Coronavirus Scare
I N D I A
A2Z INFRA: CARE Maintains 'D' Rating in Not Cooperating Category
AISHWARYA AVANT: CARE Cuts INR18cr LT Loan Rating to D, Not Coop.
ASIATIC ELECTRICAL: Ind-Ra Lowers LongTerm Issuer Rating to 'BB+'
CARONA KNITWEAR: CARE Cuts INR22.50cr Loan Rating to D, Not Coop.
COSMIC FERRO: CARE Maintains 'D' Rating in Not Cooperating
DEEN DAYAL: CARE Maintains 'D' Rating in Not Cooperating
JHARKHAND ROAD: Ind-Ra Ups INR17.3BB NCDs Rating to 'C'
LAN MARK: CRISIL Lowers Rating on INR6cr Cash Loan to B+
M.P.K. STEEL: CRISIL Maintains 'D' Rating in Not Cooperating
MEFCO ENGINEERS: CRISIL Lowers Rating on INR6.3cr Loan to B+
MITHRA COACHES: CARE Keeps D Rating in Not Cooperating Category
MULTI FOOD: CRISIL Keeps B+ Rating in Not Cooperating Category
NEELKANTH ART: CRISIL Lowers Rating on INR5.0cr Loan to B+
NTS DAIRY: CRISIL Maintains 'D' Rating in Not Cooperating
OM SHIV: CRISIL Maintains 'B' Rating in Not Cooperating
OM THREADS: CRISIL Lowers Rating on INR9.3cr LT Loan to B+
ORCHARD FOODS: CRISIL Maintains 'D' Rating in Not Cooperating
PRAKHHYAT INFRAPROJECTS: CRISIL Keeps D Rating in Not Cooperating
R-TECH PROMOTERS: CARE Lowers Rating on INR11.30cr Loan to D
RAJASTHAN CYLINDERS: CARE Lowers Rating on INR6.5cr Loan to B
SHILPA ELECTRICAL: CARE Lowers Rating on INR9.0cr Loans to D
SHREE GEETA: CARE Maintains 'D' Rating in Not Cooperating
SHREE SUKHAKARTA: Ind-Ra Withdraws 'D' Long Term Issuer Rating
TECHNOFAB ENGINEERING: Insolvency Resolution Process Case Summary
I N D O N E S I A
[*] INDONESIA: To Liquidate, Merge Underperforming SOEs
M A L A Y S I A
PRIME GLOBAL: Incurs $267K Net Loss in Fiscal 2019
S I N G A P O R E
CHINA FISHERY: Kirkland & Ellis Updates on Noteholders
HONESTBEE: Proposes to Repay Creditors 3% in Cash, Rest in Equity
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A U S T R A L I A
=================
CANEFLIGHT PTY: First Creditors' Meeting Set for Feb. 14
--------------------------------------------------------
A first meeting of the creditors in the proceedings of Caneflight
Pty. Ltd., formerly trading as Reef Flight & Bush Flight/Horizontal
Falls Adventure Tours, will be held on Feb. 14, 2020, at 11:00 a.m.
at the offices of David Clout & Associates Level 3, at 26 Wharf
Street, in Brisbane, Queensland.
David Lewis Clout of David Clout & Associates was appointed as
administrator of Caneflight Pty on Jan. 22, 2020.
COCKBURN CENTRAL: First Creditors' Meeting Set for Feb. 17
----------------------------------------------------------
A first meeting of the creditors in the proceedings of Cockburn
Central Cosmetic And Medical Clinic Pty Ltd, trading as Medivive
Cosmetic Medical Clinics, will be held on Feb. 17, 2020, at 10:30
a.m. at the offices of 463 Scarborough Beach Road, in Osborne Park,
WA.
Simon Roger Coad of Ticcidew Insolvency was appointed as
administrator of Cockburn Central on Feb. 6, 2020.
DECIMAL SOFTWARE: First Creditors' Meeting Set for Feb. 13
----------------------------------------------------------
A first meeting of the creditors in the proceedings of:
- Decimal Software Pty Ltd
- Decimal Technology and Systems Pty Ltd
- Decimal Pty Ltd
- Simpla Pty Ltd
will be held on Feb. 13, 2020, at 1:30 p.m. at Central Park, Level
43, at 152-158 St Georges Terrace, in Perth, WA.
Matthew James Byrnes and David Hodgson of Grant Thornton were
appointed as administrators of Decimal Software on Feb. 3, 2020.
SCOOTI PTY: First Creditors' Meeting Set for Feb. 17
----------------------------------------------------
A first meeting of the creditors in the proceedings of Scooti Pty
Ltd will be held on Feb. 17, 2020, at 10:30 a.m. at the offices of
Deloitte Financial Advisory Pty Ltd, Level 10, at 550 Bourke
Street, in Melbourne, Victoria.
David Ian Mansfield and Robert Woods of Deloitte Financial Advisory
were appointed as administrators of Scooti Pty on Feb. 5, 2020.
TOTAL SCOOTER: First Creditors' Meeting Set for Feb. 17
-------------------------------------------------------
A first meeting of the creditors in the proceedings of Total
Scooter Holdings Pty Ltd will be held on Feb. 17, 2020, at 11:00
a.m. at the offices of Deloitte Financial Advisory Pty Ltd, Level
10, at 550 Bourke Street, in Melbourne, Victoria.
David Ian Mansfield and Robert Woods of Deloitte Financial Advisory
were appointed as administrators of Scooti Pty on Feb. 5, 2020.
WALKER GRAPHICS: Goes Into Voluntary Administration
---------------------------------------------------
Ian Ackerman at Print21 reports that Walker Graphics, also trading
as Vivid Print Services, has gone into voluntary administration.
Administrator Mackay Goodwin has arranged the second meeting of
creditors to be held today, Feb. 10, the report says.
At the meeting, the administrators are to release a report about
the business, property, affairs, and financial circumstances of the
company. The administrators will then give an opinion as to whether
it would be in the creditors' interest for the company to be wound
up, for the administration to end, or for the company to execute a
deed of company arrangement. And finally, the creditors are to
decide what course of action to take.
Walker Graphics and its various divisions offered a wide range of
print services from business cards to billboards. Walker Graphics
-- owned by Mark Walker -- also trades as Canned Heat Media &
Marketing, Inky Tee, Vivid Print Services, and franchise operation
Worldwide Online Printing, Fyshwick.
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C H I N A
=========
BAOSHANG BANK: Future Could Hinge on a Shareholder Vote
-------------------------------------------------------
Wu Hongyuran and Timmy Shen at Caixin Global report that Huishang
Bank Corp. Ltd. will hold a shareholder meeting on Feb. 22 to
decide whether to purchase part of the assets of Baoshang Bank Co.
Ltd., which regulators took the rare step of taking over in May,
according to a filing to the Hong Kong Stock Exchange.
Caixin relates that Huishang, a city commercial bank based in East
China's Anhui province, had previously come to the rescue of the
troubled Baoshang Bank by offering to participate in creating a new
bank that will take over some of its problematic assets. Huishang
could gain a foothold in other provinces as part of the deal, the
report says.
According to Caixin, the company confirmed in the filing that it
plans to make a one-off capital contribution of up to CNY3.6
billion ($515 million) to help establish a new provincial bank in
the Inner Mongolia autonomous region -- where Baoshang is
headquartered -- that operates only in that region.
Baoshang Bank Co., Ltd. provides various commercial banking
products services to individuals and corporate customers in China.
As reported in the Troubled Company Reporter-Asia Pacific on May
27, 2019, Caixin Global said China's financial regulators took
control of a small private bank as part of authorities' efforts to
break up fallen tycoon Xiao Jianhua's business empire and contain
financial risks. According to Caixin, the People's Bank of China
(PBOC) and China Banking and Insurance Regulatory Commission
(CBIRC) announced on May 24, 2019, the takeover of Baoshang Bank
Co. for a year. The rare takeover came two years after Xiao, the
billionaire founder of conglomerate Tomorrow Holding Group, went
missing from a luxury Hong Kong hotel. He is reportedly to have
been placed under graft investigation by Chinese authorities. The
regulators said the takeover reflects the "severe credit risk" the
bank poses and is intended to protect the interests of the bank's
depositors and other clients.
CBAK ENERGY: Agrees w/ Atlas Sciences to Swap $100K Note for Equity
-------------------------------------------------------------------
CBAK Energy Technology, Inc. entered into an exchange agreement on
Jan. 27, 2020, with Atlas Sciences, LLC, pursuant to which the
Company and the Lender agreed to (i) partition a new promissory
note in the original principal amount equal to $100,000 from the
outstanding balance of certain promissory note that the Company
issued to the Lender on July 24, 2019, which has an original
principal amount of $1,395,000, and (ii) exchange the Partitioned
Promissory Note for the issuance of 160,256 shares of the Company's
common stock, par value $0.001 per share to the Lender. According
to the Exchange Agreement, the Shares are required to be delivered
to the Lender on or before Jan. 29, 2020 and the exchange will
occur upon the Lender's surrender of the Partitioned Promissory
Note to the Company on the date when the Shares are eligible for
free trading.
About CBAK Energy
Dalian, China-based CBAK Energy Technology, Inc., formerly China
BAK Battery, Inc. -- http://www.cbak.com.cn/-- is engaged in the
business of developing, manufacturing and selling new energy high
power lithium batteries, which are mainly used in the following
applications: electric vehicles; light electric vehicles; and
electric tools, energy storage, uninterruptible power supply, and
other high power applications.
CBAK Energy reported a net loss of $1.95 million for the year ended
Dec. 31, 2018, compared with a net loss of $21.46 million for the
year ended Dec. 31, 2017. As of Sept. 30, 2019, CBAK Energy had
$110.40 million in total assets, $98.90 million in total
liabilities, and $11.50 million in total equity.
Centurion ZD CPA & Co., in Hong Kong, China, the Company's auditor
since 2016, issued a "going concern" qualification in its report
dated April 16, 2019, on the Company's consolidated financial
statements for the year ended Dec. 31, 2018, citing that the
Company has a working capital deficiency, accumulated deficit from
recurring net losses and significant short-term debt obligations
maturing in less than one year as of Dec. 31, 2018. All these
factors raise substantial doubt about its ability to continue as a
going concern.
IDEANOMICS INC: Qingdao Agrees to Invest RMB200 Million
-------------------------------------------------------
Ideanomics, Inc., entered into an agreement with Qingdao Xingyang
City Investment in which Qingdao agreed to invest, pursuant to an
installment plan, in the Company's subsidiary, Qingdao Mobile New
Energy Vehicle Sales Co. Ltd., an aggregate of potentially RMB200
million as registered capital with an initial investment of RMB50
million (approximately $7.2 million). The Company and Qingdao also
agreed to jointly establish Mobile to engage in electric commercial
vehicle sales. Pursuant to the Agreement Qingdao agreed that within
10 days after the completion of the establishment of Mobile,
Qingdao would invest RMB50 million as the first installment and,
once Mobile starts operation, an additional RMB50 million as
registered capital for each RMB10 billion sales revenue realized by
Mobile or for each RMB10 billion increase in the market value of
Mobile. Once Mobile achieves RMB30 billion or its market value
reaches RMB30 billion Qingdao will pay the RMB200 million in full
as registered capital. Qingdao will receive a 10% equity interest
in Mobile for the full investment of RMB200 million.
About Ideanomics
Ideanomics, formerly known as Seven Stars Cloud Group, Inc., is a
global fintech advisory and Platform-as-a-Service company.
Ideanomics combines deal origination and enablement with the
application of blockchain and artificial intelligence technologies
as part of the next-generation of financial services. The company
is headquartered in New York, NY, and has offices in Beijing,
China. It also has a planned global center for technology and
innovation in West Hartford, CT, named Fintech Village.
Ideanomics reported a net loss of $28.42 million for the year ended
Dec. 31, 2018, compared to a net loss of $10.86 million for the
year ended Dec. 31, 2017. As of Sept. 30, 2019, Ideanomics had
$164.76 million in total assets, $47.26 million in total
liabilities, $1.26 million in convertible redeemable preferred
stock, and $116.24 million in total equity.
B F Borgers CPA PC, in Lakewood, Colorado, the Company's auditor
since 2018, issued a "going concern" opinion in its report dated
April 1, 2019, on the Company's consolidated financial statements
for the year ended Dec. 31, 2018, citing that the Company incurred
recurring losses from operations, has net current liabilities and
an accumulated deficit that raise substantial doubt about its
ability to continue as a going concern.
Ideanomics received a letter from the Listing Qualifications Staff
of The Nasdaq Stock Market LLC on Jan. 10, 2020, indicating that
the bid price for the Company's common stock for the last 30
consecutive business days had closed below the minimum $1.00 per
share required for continued listing under Nasdaq Listing Rule
5550(a)(2). Under Nasdaq Listing Rule 5810(c)(3)(A), the Company
has been granted a 180 calendar day grace period, or until July 8,
2020, to regain compliance with the minimum bid price requirement.
NEUROMETRIX INC: Incurs $3.8M Net Loss for Year Ended Dec. 31, 2019
-------------------------------------------------------------------
NeuroMetrix, Inc., filed with the U.S. Securities and Exchange
Commission its annual report on Form 10-K, disclosing a net loss
applicable to common stockholders of $3,773,014 on $9,272,522 of
revenues for the year ended Dec. 31, 2019, compared to a net income
applicable to common stockholders of $23,605 on $16,090,138 of
revenues for the year ended in 2018.
The audit report of Moody, Famiglietti, & Andronico, LLP, states
that the Company has suffered recurring losses from operations,
negative cash flows from operating activities and has an
accumulated deficit that raise substantial doubt about its ability
to continue as a going concern.
The Company's balance sheet at Dec. 31, 2019, showed total assets
of $6,893,686, total liabilities of $4,363,452, and stockholders'
equity of $2,530,234.
A copy of the Form 10-K is available at:
https://is.gd/MHDoy7
NeuroMetrix, Inc., a healthcare company, develops and markets
products for the detection, diagnosis, and monitoring of peripheral
nerve and spinal cord disorders. The Company develops wearable
neuro-stimulation therapeutic devices and point-of-care neuropathy
diagnostic tests to address chronic health conditions, including
chronic pain, sleep disorders, and diabetes. It operates in the
United States, Europe, Japan, China, the Middle East, and Mexico.
The Company has a strategic collaboration with GlaxoSmithKline.
NeuroMetrix, Inc. was founded in 1996 and is headquartered in
Waltham, Massachusetts.
[*] Coronavirus Outbreak Could Hit Airlines, Hotels, Gaming Firms
-----------------------------------------------------------------
Chad Bray and Ryan Swift at South China Morning Post report that
the worsening Wuhan coronavirus outbreak is taking a heavy toll on
airlines, gaming companies and hotel chains that have increasingly
relied on the exponential growth of Chinese tourists and their
spending power in recent years. It could still get worse, analysts
said.
SCMP relates that the health scare has prompted authorities from
Hong Kong to Singapore to stem or ban visits by Chinese residents
or people who have visited the mainland in recent weeks to contain
the outbreak. Beijing also has locked down some cities,
disconnected domestic transport hubs and barred local tour groups
from going abroad.
According to the report, British Airways and German airline
Lufthansa have suspended direct flights to the mainland, while
Cathay Pacific and Hong Kong Airlines plan to halve their flights
to the mainland until the end of March. American Airlines, Delta
Air Lines, United Airlines and Air Canada also have reduced their
flights to the country.
The moves come 17 years after the Sars (severe acute respiratory
syndrome) epidemic afflicted more than 8,000 people in 37 countries
and devastated economies in Hong Kong and across the Asia-Pacific
region, the report notes.
SCMP says mainland Chinese and their tourist dollars have helped
fuelled Southeast Asian economies in recent years. They accounted
for 19 per cent of Singapore's tourist visits in the first 11
months of 2019 and about 28 per cent of all foreign visitors to
Thailand last year, the report discloses citing government data.
"The outbreak will take a toll on tourism sectors elsewhere in the
region, and places outside the region that receive tourists from
China," the report quotes Claire Li, a Moody's Investors Service
analyst, as saying. The potential negative spillover is likely to
be worse than during the Sars outbreak, she added.
The coronavirus outbreak is believed to have begun in a wet market
in Wuhan in central province of Hubei. It has since claimed more
than 200 lives and spread to more countries, prompting the World
Health Organization to declare an emergency.
According to the report, Li said the fear of contagion could dampen
consumer demand and affect travel, trade and services in Hong Kong,
Macau, Thailand, Japan, Vietnam and Singapore, which have been the
top destinations for Chinese tourists in recent years.
Travel and tourism companies with operations in southeast Asia had
already been feeling pressure in the past year as the slowing
Chinese economy and the US-China trade war kept tourists at home,
SCMP says.
As a reference, a yardstick measuring revenue passenger kilometres
-- distance travelled by paying passengers -- of Asia-Pacific
airlines fell by 35 per cent in May 2003, according to the
International Air Transport Association. For all of 2003, it fell 8
per cent.
Airline stocks have slumped in the past two weeks, reflecting the
worries, the report notes.
The reaction reflects a temporary event and not a structural one
from a long-term perspective, said Ahmad Maghfur Usman, a transport
and logistics analyst at Nomura, according to SCMP.
"In the meantime, we expect continued pressure on stock prices as
valuation multiples are squeezed and once the dust settles, as
history has repeated itself, stocks will reverse sharply, in our
view," he wrote a research note, SCMP relays.
The gaming industry is another sector that could face further
pressure, the report notes.
Hotel operators in Hong Kong, as well as others with a big
footprint in Asia, are also under the cosh as they offered to waive
cancellation fees, analysts, as cited by SCMP, said. Their shares,
though, have not been hit as hard as airlines and casino operators,
having earlier lost their shine in 2019 amid anti-government
protests, the report adds.
=================
H O N G K O N G
=================
HONG KONG AIR: To Cut 400 Jobs, Operations Amid Coronavirus Scare
-----------------------------------------------------------------
Reuters reports that Hong Kong Airlines said on Feb. 7 that it will
slash 400 jobs and cut operations given weak travel demand because
of the coronavirus outbreak, adding to financial woes for the
city's second-largest carrier.
The South China Morning Post first reported about the airline's
plans to cut about 10% of its workforce, Reuters notes.
"As uncertainty looms with the evolving nature of this global
issue, weak travel demand will likely continue into the summer
season and we need to take further action to stay afloat," an
airline spokesman said in an email to Reuters.
"There has never been a more challenging time in Hong Kong
Airlines' history as of now. These decisions are difficult but had
to be made to keep the airline alive," he added.
According to Reuters, several airlines have suspended flights to
China, where the virus is believed to have originated. The flu-like
coronavirus can be transmitted from person to person and has
infected more than 31,000 and claimed 636 lives so far on the
mainland.
It has spread globally, with 320 cases in 27 countries and regions
outside mainland China, according to a Reuters tally of official
statements.
Hong Kong Airlines, part owned by cash-strapped Chinese
conglomerate HNA Group, said it will reduce its daily operations to
30 from 82 sectors over Feb. 11 to March, Reuters relates.
It also said its Hong Kong-based ground staff will be asked to take
a minimum of two weeks unpaid leave per month, or switch to working
three days a week between Feb. 17 and June 30, according to
Reuters.
Reuters says larger rival Cathay Pacific Airways has already asked
employees to take three weeks of unpaid leave, saying preserving
cash was key and conditions were as grave as during the 2009
financial crisis due to the virus outbreak.
Both Cathay and Hong Kong Airlines have been grappling with a sharp
fall in demand since the middle of 2019 due to widespread,
sometimes violent, anti-government protests in the
Chinese-controlled territory, Reuters notes.
Hong Kong Airlines has also been battling other financial woes, the
report says. In December, it was forced to draw up plans to raise
money as it faced the possibility of a license suspension by the
city's air transport regulator, Reuters adds.
As reported in the Troubled Company Reporter-Asia Pacific on Feb.
7, 2019, The South China Morning Post said that a Macau-based
lender has sued troubled Hong Kong Airlines following its alleged
failure to repay a US$20 million loan despite repeated demands.
According to the Post, court documents revealed that Hong Kong
Airlines International Holdings borrowed US$20 million from Luso
International Banking in October 2017, on condition the principal
be repaid with interest by December 28 last year. But lawyers for
the bank said the airline paid only US$257,934.44 after the
deadline, on Jan. 1, 2019, in breach of its contractual
obligations.
Hong Kong Airlines operates 38 passenger aircraft to 36
destinations.
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I N D I A
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A2Z INFRA: CARE Maintains 'D' Rating in Not Cooperating Category
----------------------------------------------------------------
CARE Ratings said the rating for the bank facilities of A2Z Infra
Engineering Limited (A2Z) continues to remain in the 'Issuer Not
Cooperating' category.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long-term Bank 293.32 CARE D; ISSUER NOT COOPERATING;
Facilities Based on best available
Information
Short-term
Bank Facilities 721.01 CARE D; ISSUER NOT COOPERATING;
Based on best available
Information
Detailed Rationale & Key Rating Drivers
CARE has been seeking information from A2Z to monitor the rating(s)
vide e-mail communications dated December 20, 2019, December 25,
2019, December 27, 2019, December 30, 2019, January 6, 2020 and
numerous phone calls. However, despite CARE's repeated requests,
the company has not provided the requisite information for
monitoring the ratings. In line with the extant SEBI guidelines,
CARE has reviewed the rating on the basis of the best available
information which however, in CARE's opinion is not sufficient to
arrive at a fair rating. The rating on the bank facilities of A2Z
Infra Engineering Limited 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
The rating assigned to the bank facilities of A2Z Infra Engineering
Limited (A2Z) continues to factor in delays in
debt servicing by the company. (Updated for the information
available from Registrar of Companies, stock exchange):
Key Rating Weaknesses
Ongoing delays in debt servicing: There are ongoing delays in
servicing of its debt obligations due to the stretched liquidity
position.
Weak financial performance:
The collection period of the company remained relatively higher to
about 731 days in FY19 indicates slow realization of debtors. The
company' s overall gearing has improved to 0.59x (PY: 1.21) on
account of decrease in total debt, however total debt to GCA and
total debt to PBILDT have remained higher to 7.84 times and 6.08
times respectively. Along with this, the company reported revenue
of INR 521.51 crore during FY19 (PY: INR370.74 crore) with profit
at operating level of INR56.34 crore in FY19 (PY: Loss of INR10.44
crore). During 6MFY20, A2Z reported total operating income and
PBILDT of INR270.10 crore and INR8.50 crore respectively.
Incorporated in January 2002 as A2Z Maintenance Services Private
Ltd, the company was renamed 'A2Z Maintenance & Engineering
Services Private Ltd in May 2005. Subsequently, the company became
a public limited company in March 2010. A2Z came up with an IPO in
December 2010 and raised INR776.2 crore. The company got its
present name in December 2014 and is primarily engaged in providing
Engineering, Procurement and Construction (EPC) services in power
transmission and distribution sector.
AISHWARYA AVANT: CARE Cuts INR18cr LT Loan Rating to D, Not Coop.
-----------------------------------------------------------------
CARE Ratings revised the ratings on certain bank facilities of
Aishwarya Avant Builders LLP, as:
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long-term Bank 18.00 CARE D; ISSUER NOT COOPERATING;
Facilities Revised from CARE BB; Stable
Detailed Rationale & Key Rating Drivers
The revision in the rating assigned to the Long term Bank
Facilities of Aishwarya Avant Builders LLP takes into account the
ongoing delays in debt servicing owing to strained liquidity
position faced by the company. Additionally, CARE has been seeking
information from Aishwarya Avant Builders LLP to monitor the
rating(s) vide e-mail communications dated November 8, 2019,
December 6, 2019, January 3, 2020 and letter dated January 8, 2020.
However, despite CARE's repeated requests, the company has not
provided the requisite information for monitoring the ratings.
In the absence of minimum information required for the purpose of
rating, CARE is unable to express opinion on the rating. In line
with the extant SEBI guidelines CARE's rating on Aishwarya Avant
Builders LLP's bank facilities will now be denoted as CARE D;
ISSUER NOT COOPERATING.
Users of this rating (including investors, lenders and the public
at large) are hence requested to exercise caution while using the
above rating(s).
The ratings take into account the ongoing delays in servicing of
the debt obligations by the company on account of its constrained
liquidity position.
Detailed Rationale & Key Rating Drivers
Key rating weaknesses
Ongoing delays in servicing debt
The revision in rating is on account of the ongoing delays in debt
servicing of the company.
Avant Group is a Mumbai based real estate developer which was
established in the year 2010 by founder promoter Mr. Sudeep Saha.
The other promoter is Mr. Harsh R. Shah. The firm Aishwarya Avant
Builders LLP (AABL) is currently developing a residential
redevelopment project in Jogeshwari (East), Mumbai. The project is
known as "Avant Heritage" which comprises of Phase-I & Phase-II
located adjacent to each other and having total saleable area of
1.04 lakh sq. ft.
ASIATIC ELECTRICAL: Ind-Ra Lowers LongTerm Issuer Rating to 'BB+'
-----------------------------------------------------------------
India Ratings and Research (Ind-Ra) has downgraded Asiatic
Electrical & Switchgear Pvt. Ltd.'s (Asiatic) Long-Term Issuer
Rating to 'IND BB+' from 'IND BBB-'. The Outlook is Negative.
The instrument-wise rating actions are:
-- INR150 mil. (reduced from INR200 mil.) Fund-based limit
downgraded with IND BB+/Negative/IND A4+ rating;
-- INR110.29 mil. (reduced from INR121.5 mil.) Term loan due on
August 2022 downgraded with IND BB+/Negative rating; and
-- INR150 mil. (increased from INR100 mil.) Non-fund-based limit
downgraded with an IND A4+ rating.
Analytical Approach: Ind-Ra continues to factor in the availability
of significant support to Asiatic from its parent, LTL Holdings
(Private) Limited (LTL; holds 99.07% stake in Asiatic), in view of
the strategic linkages between the entities. Furthermore, Asiatic's
debt is secured by an irrevocable corporate guarantee of USD8
million from LTL.
The downgrade reflects the deterioration in the company's
performance in 1HFY20, mainly because of low order conversion and a
decline in demand from the Middle East region. The Negative Outlook
reflects Ind-Ra's expectation that the company's performance would
deteriorate in FY20.
KEY RATING DRIVERS
Deterioration in Operating Performance: Asiatic's revenue fell by
24% YoY to INR236.2 million in 1HFY20. The company's absolute
EBIDTA fell to INR0.86 million in 1HFY20 (1HFY19: INR28.3 million),
with a margin of 0.4% (9.1%). The credit metrics deteriorated in
1HFY20 due to the fall in absolute EBITDA, with interest coverage
of 0.10x (1HFY19: 3x) and net leverage of 90.2x (FY19: 3.5x).
In FY19, Asiatic's revenue had increased to INR617.72 million
(FY18: INR556.58 million), backed by healthy growth in orders. The
EBITDA had increased to INR52.67 million in FY19 (FY18: INR1.69
million) owing to an increase in operating revenue. The operating
margin had improved to a modest 8.53% in FY19 (FY18: 0.3%) due to
an increase in the share of export-based orders, which offer higher
margins. The return on capital employed was 10.1% (FY18: negative
figure).
Asiatic's order book comprises more of export-based orders in
4QFY20; hence, the revenue and margins are likely to recover
slightly in the near term. However, the deterioration in the
company's performance in 1HFY20 shall affect its credit metrics
over the same period.
Support from Parent: Asiatic has been receiving continued support
from its parent, LTL. Domiciled in Sri Lanka, LTL's parent is
Ceylon Electricity Board (Fitch Ratings Ltd: AA+(lka)'/Stable),
which holds a 63% stake in the company; 27% stake is held by
Peradev Limited (formerly known as LTL ESOT Ltd).LTL's credit
profile has benefited from its sovereign ownership, which has
resulted in stringent parliamentary oversight. LTL has been
contributing significantly to the development of the rural power
infrastructure and the renewable energy sector in Sri Lanka
(Long-Term Foreign-Currency IDR 'B'/Negative).
Asiatic is strategically important to LTL in view of the latter's
plans to expand its market in India and the Middle East.
Furthermore, two of LTL's directors are on the board of Asiatic;
thus, the parent entity is actively involved in taking strategic
decisions for AESPL. During FY20, LTL reduced the dividend rate for
the compulsorily convertible preference shares (CCPS) held in
Asiatic, from 10.5% to 1%, reducing the dividend pay-out and cash
outflow from the company. LTL has provided an assurance that it
shall continue to monitor Asiatic's cash flow from operations and
will be in a position to identify any existing or potential cash
flow mismatches and extend cash flow support to ensure debt
servicing in a timely manner.
Liquidity Indicator - Stretched: Asiatic's average utilization of
bank limits was 70% in the 12 months ended November 2019. The cash
flow from operations increased to INR62.88 million in FY19 (FY18:
INR49.99 million) due to healthy order book conversion. In FY19,
the working capital cycle shortened to 88 days (FY18:113 days) In
1HFY20 the working capital cycle increased to 127 days due to low
order book conversion.
Tender-Based Nature of Business: Asiatic has been catering to
various foreign and domestic power utilities by participating in
competitive tenders from time to time. To benefit from the
increased government capital outlay towards meeting rural
electrification needs, Asiatic has started bidding for tenders by
various power utilities. Given the transition towards catering to
domestic power sector players, Asiatic's operating performance
shall be susceptible to its ability to secure contracts at
competitive rates. As contracts for the procurement of products
such as feeder pillars switch gears and control panels are
typically short-term in nature, the company shall be required to
participate in frequent tenders while maintaining an optimum
conversion rate.
RATING SENSITIVITIES
Positive: Improvement in profitability leading to improved
liquidity and gross interest coverage going above 1.75x
Negative: Further deterioration in liquidity position in the
business or lack of support from the parent OR gross interest
coverage going below 1.75x.
COMPANY PROFILE
Asiatic designs manufacture and sell a wide range of switchgear
products, including feeder pillars, distribution boards,
low-voltage cut-outs, fuse switches, fuse cut-outs, surge
arrestors, fuse boards, and composite insulators.
CARONA KNITWEAR: CARE Cuts INR22.50cr Loan Rating to D, Not Coop.
-----------------------------------------------------------------
CARE Ratings revised the ratings on certain bank facilities of
Carona Knitwear (CKW), as:
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long term Bank 1.45 CARE D; ISSUER NOT COOPERATING;
facilities Revised from CARE BB; Stable on
the basis of best available
information
Short-term Bank 22.50 CARE D; ISSUER NOT COOPERATING;
Facilities Revised from CARE A4 on the
basis of best available
information
Detailed Rationale & Key Rating Drivers
CARE has been seeking information from CKW to monitor the rating
vide e-mail communications/ letters dated November 25, 2019,
November 29, 2019, December 12, 2019, December 20, 2019 & January
22, 2020 and numerous phone calls. However, despite CARE's repeated
requests, the firm has not provided the requisite information for
monitoring the rating. In line with the extant SEBI guidelines,
CARE has reviewed the rating on the basis of best available
information which however, in CARE's opinion is not sufficient to
arrive at fair rating. The rating on Carona Knitwear's bank
facilities will now be denoted as CARE D; ISSUER NOT COOPERATING.
Users of this rating (including investors, lenders and the public
at large) are hence requested to exercise caution while using the
above rating.
Detailed Rationale & Key Rating Drivers
The revision in the rating assigned to the bank facilities of
Carona Knitwear takes into account of ongoing delays in the
servicing of debt obligations.
Detailed description of the key rating drivers
Key Rating Weaknesses
Ongoing delays in meeting of debt obligations
Carona Knitwear has discontinued its operations, due to which the
firm is unable to service the debt obligations. There are ongoing
delays in servicing the interest and installment in term loan
facility.
Key Rating Strengths
Long track record and experience of the partners for more than
three decades in textiles industry
CKW was established in the year 2006 and was promoted by Mr. Swami
Nathan, Mrs. S. Shanthamani and Mr. Kathiresh Swaminathan. Mr.
Swami Nathan (Managing Partner) has more than three decades of
experience in textiles industry. Mr. Kathiresh Swaminathan is
qualified post graduate and has more than three decades of
experience in textiles industry. Due to long experience of the
Partners, they were able to establish long term relationship with
clientele which enables the firm to get repeated orders from its
clientele along with new customers.
Tamil Nadu based, Carona Knitwear (CKW) was established in the year
2006 as partnership firm promoted by Mr. Swami Nathan, Mrs. S.
Shanthamani and Mr. Kathiresh Swaminathan. The firm is engaged in
manufacturing, processing, importing, exporting, buying, selling
and dealing all kinds of fabric textiles and hosiery goods and
readymade garments.
COSMIC FERRO: CARE Maintains 'D' Rating in Not Cooperating
----------------------------------------------------------
CARE Ratings said the rating for the bank facilities of Cosmic
Ferro Alloys Limited (CFAL) continues to remain in the 'Issuer Not
Cooperating' category.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long-term Bank 84.65 CARE D; ISSUER NOT COOPERATING;
Facilities Based on best available
Information
Short term Bank 122.05 CARE D; ISSUER NOT COOPERATING;
Facilities Based on best available
Information
Detailed Rationale & Key Rating Drivers
CARE had, vide its press release dated August 2, 2018 continued the
ratings of CFAL under the 'issuer non-cooperating' category as CFAL
had failed to provide information for monitoring of the rating and
had not paid the surveillance fees for the rating exercise as
agreed to in its Rating Agreement. CFAL continues to be
non-cooperative despite repeated requests for submission of
information through e-mails and a letter dated December 2, 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 August 2, 2018 the following were the
rating strengths and weaknesses (updated for the information
available from Registrar of Companies):
Key Rating Weaknesses
Delays in debt servicing: CARE is not in a position to comment
further on account of non-availability of relevant documents and
non-cooperation from the company.
Cosmic Ferro Alloys Limited (CFAL), incorporated in 2003, is
engaged in manufacturing of ferro manganese and silica manganese
with an installed capacity of 45 MVA (5 furnaces of 9 MVA each) at
Barjora, Durgapur, West Bengal. In April 2014, CFAL forayed into a
new product line, namely, Cold Rolled Form Sections (CRFS) by
setting up a new manufacturing facility of 18,000 MTPA in Singur,
West Bengal.
DEEN DAYAL: CARE Maintains 'D' Rating in Not Cooperating
--------------------------------------------------------
CARE Ratings said the rating for the bank facilities of Deen Dayal
Foods Private Limited (DDFPL) continues to remain in the 'Issuer
Not Cooperating' category.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long-term Bank 9.49 CARE D; ISSUER NOT COOPERATING;
Facilities Based on best available
Information
Short term Bank 2.00 CARE D; ISSUER NOT COOPERATING;
Facilities Based on best available
Information
Detailed Rationale & Key rating Drivers
CARE has been seeking information from DDFPL to monitor the
rating(s) vide e-mail communications/letters dated January 2, 2020,
January 8, 2020 and January 10, 2020 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.
Further, DDFPL'S has not paid the surveillance fees for the rating
exercise as agreed to in its Rating Agreement. DDFPL's bank
facilities will now be denoted as CARE D/CARE D; ISSUER NOT
COOPERATING.
Users of this rating (including investors, lenders and the public
at large) are hence requested to exercise caution while using the
above rating(s).
Detailed description of the key rating drivers: At the time of last
rating on April 1, 2019, the following were the rating strengths
and weaknesses.
Key Rating Weakness
Delay in the debt servicing
There were on-going delays in debt servicing in past owing to
stressed liquidity position.
DDFPL was incorporated in 2010 by Mr. Dileep Kumar Singhal, Mrs.
Aradhna Singhal and Mr Vijay Pal. The company is engaged in the
business of manufacturing milk and milk products. It purchases milk
from local farmers with the help of agents. Its products include
loose milk, skimmed milk powder, butter, Ghee, etc. It has a good
customer base all over India. The company supplies its products
mainly to Parle Products Private Limited and Virat Crane Industries
Limited.
JHARKHAND ROAD: Ind-Ra Ups INR17.3BB NCDs Rating to 'C'
-------------------------------------------------------
India Ratings and Research (Ind-Ra) has upgraded the rating on
Jharkhand Road Projects Implementation Company Limited's (JRPICL)
INR17,300 million non-convertible debentures (NCDs) to 'IND C' from
'IND D'.
The detailed rating action is:
-- INR17.300 bil. (outstanding INR13,737.70 bil. as of January
31, 2020) Senior, secured, redeemable NCDs* upgraded with IND
C rating.
* Details in annexure
The upgrade reflects JRPICL's regular debt service from September
2019. Timely debt service has been confirmed by the debenture
holders and debenture trustee. To accommodate sponsor loan
repayments, not only the debt terms have been diluted (including
reduced debt service reserve account (DSRA) of three months against
the original nine months) but also the cushion on the operations
and maintenance (O&M) budget has been eroded. The present debt
structure stipulates sponsor loan repayments and lacks clarity on
the rights to call an event of default on sponsor loan delays.
These structure changes and liquidity pressures led to slippages in
the completion of major maintenance (MM) and pose a risk to timely
annuity receipt. Since January 2019, the nine annuities across
JRPICL's all five projects have been received with delays.
Additionally, the annuity for the company's Chaibasa Kandra Chowka
Road (CKC) project due in November 2019 is yet to be received,
thereby leading to the part utilization of DSRA.
JRPICL defaulted on the payment of redemption of NCDs due on 21
January 2019, despite the availability of sufficient cash (click
here to read the press release on IL&FS special purpose vehicles'
interpretation of the National Company Law Appellate Tribunal
(NCLAT) ruling). The debenture trustee, on an instruction received
from the debenture holders, had directed the escrow bank to process
the payment on the due date. According to the trustee's
communication with Ind-Ra, the escrow bank did not process the
payment and the interest/principal payment was not made to the
debenture holders on the due date. Thus, despite the availability
of adequate funds, JRPICL defaulted on its debt obligations due to
the NCLAT's order for all IL&FS entities.
KEY RATING DRIVERS
Restructured Unsecured Debt a Constraint: Post the NCLAT's
proceedings in the last 12 months, JRPICL was reclassified as a
Green entity from Amber, based on its debt servicing ability. The
new structure for unsecured loans stipulates a defined repayment
schedule and fixed interest rate (@8.40% per annum payable
quarterly (p.a.p.q.)). Of the restructured unsecured loans of
INR8,161.10 million, INR6,310 million has to be repaid in
structured quarterly principal installments and interest payments
from 20 October 2019 until 20 October 2029 and the balance INR1,850
million (non-interest bearing) to be repaid in September 2029 as a
bullet payment. The secured debt terms have also been amended with
a lower fixed coupon rate at @8.40% p.a.p.q. but its repayment
profile is unaltered. The annual average debt service obligations
from FY21 to FY26 have increased by over 35% post the
restructuring, resulting in thin coverage metrics.
The cash flow subordination clause related to the unsecured loans
ensures that in the event of insufficient cash flows, the secured
overdue amounts shall be paid first before making any payments to
the unsecured lenders. However, the absence of any clause which
would restrict unsecured lenders' right to declare an event of
default in case of the non-payment of debt dues in the amended
financing documents constrains the rating. Therefore, Ind-Ra has
factored a consolidated debt (rated debt + unsecured loans) for the
computation of JRPICL's debt servicing obligation.
Liquidity Indicator - Stretched: The cash accruals available are
not adequate for servicing the consolidated debt obligations of the
company, thereby necessitating a dip in DSRA for timely debt
service. The coverages in FY21 and FY22 are around 0.95x (without
considering the interest income). The debt service reserve (DSR)
stipulation reduced from nine months' debt servicing earlier to
three months' in the revised debt terms. However, it is to be
maintained for both secured as well as unsecured debt in accordance
with the amended debt terms stipulated in the Master Terms
Agreement in Relation to the Debenture Trust Deed of JRPICL.
The cash balance (including DSR, major maintenance reserve (MMR),
construction reserve, escrow balance, O&M reserve, etc.) as of
January 31, 2020, was INR2,248.40 million. Although the presence of
DSR and MMR provides some comfort, the part-utilization of DSR to
the extent of INR170 million (from the stipulated INR880 million)
towards the 20 January 2020 redemption due to the non-receipt of
the timely annuity for the CKC project strains the liquidity
profile. The outstanding DSR balance as of January 31, 2020, was
INR730.42 million.
Continued High O&M Risk: The weak credit profile of the sponsor and
the O&M operator, IL&FS Transportation Networks Ltd (ITNL; 'IND D')
continues to keep JRPICL's O&M risks elevated. Elsamex Maintenance
Services Ltd (Elsamex, a subsidiary of ITNL) is the sub-contractor
for undertaking the O&M and MM activities of ITNL for JRPICL. While
amended fixed price O&M agreements (including major maintenance)
have been executed for all the five projects, delays in the
execution of MM in a timely manner is a constraining factor. The
availability of alternative road O&M contractors de-risks the
O&M-related risks, to a reasonable extent.
Although the maintenance reserve estimates remain unchanged in the
revised debt terms, the expense estimates for both O&M and MM have
been lowered considerably. According to the O&M progress reports of
August until November 2019, no lane closure was observed and the
road surface conditions have been termed satisfactory.
Non-completion of MM a Drag: The rating factor in the uncertainty
over any probable deductions from annuities due to delayed MM works
in all the projects. According to the concession agreement, the
periodic maintenance has to be carried out at the end of every 10th
semi-annual annuity period from the completion date. However, the
10th semi-annual annuity period for all projects ended in November
2019 and the periodic maintenance was not completed for any of
them. While the periodic maintenance is ongoing for three projects
and is yet to be awarded for two, the completion of the same in
FY21 without any adverse effect on annuities will remain a key
monitorable.
Single Counterparty Exposure: JRPICL's revenue is completely
dependent on annuities from the state counterparty – the
Government of Jharkhand (GoJ).
Revenue Stream: The rating continues to be supported by JRPICL's
portfolio of five annuity-based road projects from the GoJ. The GoJ
has guaranteed to make semi-annual annuity payments for all the
projects. JRPICL has a robust annuity payment mechanism that passes
through the state budgetary mechanism demonstrated by the receipt
of 61 annuities out of the scheduled 150 for all the five projects
until January 31, 2020. Almost all annuities have been received on
time without any deductions so far (except for CKC). The management
expects to receive the pending annuity soon and has represented
that the delay is on account of the recent change in the Jharkhand
government. The demonstration of timely receipt of annuities
without deductions will be a key monitorable.
RATING SENSITIVITIES
Positive: Future developments that may collectively lead to a
rating upgrade include:
1. - the timely receipt of annuities and the sustained
maintenance of DSRA without any deductions/depletion for the next
three months
2. - the completion of MM activity within the prescribed
standards without any cost overruns
- regular servicing of both secured and unsecured debt
COMPANY PROFILE
In 2007, GoJ launched the Jharkhand Accelerated Road Development
Programme under a public-private partnership framework. In February
2008, the GoJ and Infrastructure Leasing & Financial Services
Limited (IL&FS; 'IND D') signed a program development agreement to
improve 1,500 lane km of selected project road corridors. The
program is being implemented by Jharkhand Accelerated Road
Development Company Ltd.
JRPICL, which is 6.57%-owned by IL&FS and 93.43%-owned by its
subsidiary ITNL, has undertaken and implemented five projects
totaling 627 lane km: Ranchi Ring Road (sections III, IV, V and
VI), Ranchi Patratu Dam, Patratu Dam Ramgarh, Adityapur Kandra, and
CKC. All these projects have separate concession agreements with
the GoJ, along with separate escrow accounts.
LAN MARK: CRISIL Lowers Rating on INR6cr Cash Loan to B+
--------------------------------------------------------
CRISIL has revised the ratings on bank facilities of Lan Mark Shops
India Private Limited (Lan Mark) Revised to 'CRISIL B+/Stable
Issuer not cooperating'.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Cash Credit 6 CRISIL B+/Stable (ISSUER NOT
COOPERATING; Revised from
'CRISIL BB-/Stable ISSUER
NOT COOPERATING')
CRISIL has been consistently following up with Lan Mark for
obtaining information through letters and emails dated November 30,
2019 and December 9, 2019 among others, apart from telephonic
communication. However, the issuer has remained non cooperative.
'The investors, lenders and all other market participants should
exercise due caution while using the rating assigned/reviewed with
the suffix 'ISSUER NOT COOPERATING'. These ratings lack a forward
looking component as it is arrived at without any management
interaction and is based on best available or limited or dated
information on the company.
Detailed Rationale
Despite repeated attempts to engage with the management, CRISIL
failed to receive any information on either the financial
performance or strategic intent of Lan Mark, which restricts
CRISIL's ability to take a forward looking view on the entity's
credit quality. CRISIL believes information available on Lan Mark
is consistent with 'Scenario 1' outlined in the 'Framework for
Assessing Consistency of Information with CRISIL BB' rating
category or lower'.
Based on the last available information, the ratings on bank
facilities of Lan Mark Revised to 'CRISIL B+/Stable Issuer not
cooperating'.
Lan Mark, established in 2005, distributes various electronic
products through its franchisee network in Tamil Nadu and Kerala.
Lan Mark's day to day operations are managed by Mr. Jerry Mathew,
Managing Director.
M.P.K. STEEL: CRISIL Maintains 'D' Rating in Not Cooperating
------------------------------------------------------------
CRISIL said the ratings on bank facilities of M.P.K. Steel India
Private Limited (MPKS; a part of the MPK group) continues to be
'CRISIL D Issuer not cooperating'.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Cash Credit 15 CRISIL D (ISSUER NOT
COOPERATING)
Proposed Long Term 0.36 CRISIL D (ISSUER NOT
Bank Loan Facility COOPERATING)
Standby Line 0.50 CRISIL D (ISSUER NOT
of Credit COOPERATING)
Term Loan 2.44 CRISIL D (ISSUER NOT
COOPERATING)
CRISIL has been consistently following up with MPKS for obtaining
information through letters and emails dated June 29, 2019 and
December 9, 2019 among others, apart from telephonic communication.
However, the issuer has remained non cooperative.
'The investors, lenders and all other market participants should
exercise due caution while using the rating assigned/reviewed with
the suffix 'ISSUER NOT COOPERATING'. These ratings lack a forward
looking component as it is arrived at without any management
interaction and is based on best available or limited or dated
information on the company.
Detailed Rationale
Despite repeated attempts to engage with the management, CRISIL
failed to receive any information on either the financial
performance or strategic intent of MPKS, which restricts CRISIL's
ability to take a forward looking view on the entity's credit
quality. CRISIL believes information available on MPKS is
consistent with 'Scenario 1' outlined in the 'Framework for
Assessing Consistency of Information with CRISIL BB' rating
category or lower'.
Based on the last available information, the ratings on bank
facilities of MPKS continues to be 'CRISIL D Issuer not
cooperating'.
For arriving at the ratings, CRISIL has combined the business and
financial risk profiles of MPKS, MPK Metals Pvt Ltd (MPKM), and
MPKI Ispat India Pvt Ltd (MPKI). This is because the three
companies, together referred to as the MPK group, have common
ownership and management, and MPKM and MPKS have the same product
profile and sell under a common brand. MPKI has been set up in
order to backward integrate into billet manufacturing for
supporting the operations of the other two companies and has also
received corporate guarantees from them for its bank funding.
MPKS was set up as a private limited concern in 2005. It
manufactures structural products, including thermo-mechanically
treated (TMT) bars, channels, angles, and joints, at its
manufacturing facility in Jaipur. The company markets the products
under its own brand, MPK. The operations of the company are managed
by Mr. Santosh Kumar Upadhyay and his son, Mr. Manoj Upadhyay.
MPKM was set up as a private limited concern in 2009 and
manufactures structural products including TMT bars, channels,
angles, and joints at its manufacturing facility in Jaipur and
markets the same under its MPK brand. The operations of the company
are managed by Mr. Santosh Kumar Upadhyay and Mr. Manoj Upadhyay.
MPKI was set up as a private limited concern in 2010 and started
operations in 2012-13 (refers to financial year, April 1 to March
31) with 2013-14 being its first full year of operations. The
company has been set up as a backward integration unit of the group
to manufacture steel billets and ingots for captive consumption in
MPKS and MPKM. The company has its plant in Bagru (Jaipur) and is
managed by Mr. Santosh Kumar Upadhyay and Mr. Manoj Upadhyay.
MEFCO ENGINEERS: CRISIL Lowers Rating on INR6.3cr Loan to B+
------------------------------------------------------------
CRISIL has revised the ratings on bank facilities of Mefco
Engineers Private Limited (MEPL) Revised to 'CRISIL B+/Stable
Issuer not cooperating'.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Long Term Loan 6.3 CRISIL B+/Stable (ISSUER NOT
COOPERATING; Revised from
'CRISIL BB-/Stable ISSUER NOT
COOPERATING')
CRISIL has been consistently following up with MEPL for obtaining
information through letters and emails dated November 30, 2019 and
December 9, 2019 among others, apart from telephonic communication.
However, the issuer has remained non cooperative.
'The investors, lenders and all other market participants should
exercise due caution while using the rating assigned/reviewed with
the suffix 'ISSUER NOT COOPERATING'. These ratings lack a forward
looking component as it is arrived at without any management
interaction and is based on best available or limited or dated
information on the company.
Detailed Rationale
Despite repeated attempts to engage with the management, CRISIL
failed to receive any information on either the financial
performance or strategic intent of MEPL, which restricts CRISIL's
ability to take a forward looking view on the entity's credit
quality. CRISIL believes information available on MEPL is
consistent with 'Scenario 1' outlined in the 'Framework for
Assessing Consistency of Information with CRISIL BB' rating
category or lower'.
Based on the last available information, the ratings on bank
facilities of MEPL Revised to 'CRISIL B+/Stable Issuer not
cooperating'.
Furthermore, the company has not paid the fee for conducting rating
surveillance as agreed to in the rating agreement.
MEPL was incorporated in 1974 by Mr. P. S. Shanmugam undertakes
design and fabrication of crystallizers, evaporators, pressure
vessels, heat exchangers, steam pipe lines, storage tanks and
others.
MITHRA COACHES: CARE Keeps D Rating in Not Cooperating Category
---------------------------------------------------------------
CARE Ratings said the rating for the bank facilities of Mithra
Coaches Private Ltd. (MCPL) continues to remain in the 'Issuer Not
Cooperating' category.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long-term Bank 28.11 CARE D; ISSUER NOT COOPERATING;
Facilities Based on best available
Information
Detailed Rationale & Key Rating Drivers
CARE has been seeking information from MCPL to monitor the ratings
vide e-mail communications/letters dated November 4, 2019, December
31, 2019, January 2, 2020 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 best available information which however, in CARE' s opinion
is not sufficient to arrive at a fair rating. The rating on Mithra
Coaches Private Ltd.' 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 ratings.
Detailed description of the key rating drivers
At the time of last rating on November 21, 2019 the following were
the rating strengths and weaknesses:
Key Rating Weaknesses
Delays in meeting debt obligations
The company has been facing subdued operational and financial
performance on account of delayed receipt of payments primarily
from Government clients leading to strained liquidity position
resulting in delays in meeting its debt obligation on time.
Liquidity: Poor
The liquidity profile of the company is poor, marked by cash losses
incurred y-o-y, completely eroded net-worth and fully utilized bank
limits. This has constrained the ability of the company to repay
its debt obligations on a timely basis.
Mithra Coaches Private Limited (MCPL) was incorporated in 2008 and
is engaged in manufacturing of structural bodies for buses,
containers, light commercial vehicle, bunk houses, trailers, water
tankers, and oil tankers. The company is promoted by Mr. Maganti
Subrahmanyam (Chairman), Mr. M. Venugopal (Director), Mr. N.
Seshadri Sekhar (Director). Mr. Madhusudhana Sarma, Mr. M.
Chandramouli (Director). The manufacturing facility of the company
is located in Veerapanenigudem village, Andhra Pradesh and has a
capacity of manufacturing 300 buses and 240 containers in a year.
MULTI FOOD: CRISIL Keeps B+ Rating in Not Cooperating Category
--------------------------------------------------------------
CRISIL said the ratings on bank facilities of Multi Food Products
Private Limited (MFPPL) continues to be 'CRISIL B+/Stable Issuer
not cooperating'.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Cash Credit 4 CRISIL B+/Stable (ISSUER NOT
COOPERATING)
Term Loan 2.48 CRISIL B+/Stable (ISSUER NOT
COOPERATING)
CRISIL has been consistently following up with MFPPL for obtaining
information through letters and emails dated June 29, 2019 and
December 9, 2019 among others, apart from telephonic communication.
However, the issuer has remained non cooperative.
'The investors, lenders and all other market participants should
exercise due caution while using the rating assigned/reviewed with
the suffix 'ISSUER NOT COOPERATING'. These ratings lack a forward
looking component as it is arrived at without any management
interaction and is based on best available or limited or dated
information on the company.
Detailed Rationale
Despite repeated attempts to engage with the management, CRISIL
failed to receive any information on either the financial
performance or strategic intent of MFPPL, which restricts CRISIL's
ability to take a forward looking view on the entity's credit
quality. CRISIL believes information available on MFPPL is
consistent with 'Scenario 1' outlined in the 'Framework for
Assessing Consistency of Information with CRISIL BB' rating
category or lower'.
Based on the last available information, the ratings on bank
facilities of MFPPL continues to be 'CRISIL B+/Stable Issuer not
cooperating'.
Furthermore, the company has not paid the fee for conducting rating
surveillance as agreed to in the rating agreement.
MFPPL, established on January 4, 2006 is engaged in processing i.e.
milling, polishing and sorting of basmati and non-basmati rice. The
Ahmedabad-based company has been promoted by Mr Haresh Kumar
Khanchandani, MrMukeshKhanchandani and Mrs Sarita Khanchandani.
NEELKANTH ART: CRISIL Lowers Rating on INR5.0cr Loan to B+
----------------------------------------------------------
CRISIL has revised the ratings on bank facilities of Neelkanth Art
and Craft (NAC) to 'CRISIL B+/Stable Issuer not cooperating'.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Export Packing
Credit 5 CRISIL B+/Stable (ISSUER NOT
COOPERATING; Revised from
'CRISIL BB/Stable ISSUER NOT
COOPERATING')
Rupee Term Loan 2.83 CRISIL B+/Stable (ISSUER NOT
COOPERATING; Revised from
'CRISIL BB/Stable ISSUER NOT
COOPERATING')
CRISIL has been consistently following up with NAC for obtaining
information through letters and emails dated June 29, 2019 and
December 9, 2019 among others, apart from telephonic communication.
However, the issuer has remained non cooperative.
'The investors, lenders and all other market participants should
exercise due caution while using the rating assigned/reviewed with
the suffix 'ISSUER NOT COOPERATING'. These ratings lack a forward
looking component as it is arrived at without any management
interaction and is based on best available or limited or dated
information on the company.
Detailed Rationale
Despite repeated attempts to engage with the management, CRISIL
failed to receive any information on either the financial
performance or strategic intent of NAC, which restricts CRISIL's
ability to take a forward looking view on the entity's credit
quality. CRISIL believes information available on NAC is consistent
with 'Scenario 1' outlined in the 'Framework for Assessing
Consistency of Information with CRISIL BB' rating category or
lower'.
Based on the last available information, the ratings on bank
facilities of NAC Revised to 'CRISIL B+/Stable Issuer not
cooperating'.
Jodhpur-based NAC, a proprietorship firm established by Mr Uttam
Kumar Salecha , produces handicraft items from Sheesham wood. It
caters to the export market in USA and Germany.
NTS DAIRY: CRISIL Maintains 'D' Rating in Not Cooperating
---------------------------------------------------------
CRISIL said the ratings on bank facilities of NTS Dairy and Foods
Private Limited (NTS) continues to be 'CRISIL D Issuer not
cooperating'.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Cash Credit .2 CRISIL D (ISSUER NOT
COOPERATING)
Term Loan 7.0 CRISIL D (ISSUER NOT
COOPERATING)
CRISIL has been consistently following up with NTS for obtaining
information through letters and emails dated June 29, 2019 and
December 9, 2019 among others, apart from telephonic communication.
However, the issuer has remained non cooperative.
'The investors, lenders and all other market participants should
exercise due caution while using the rating assigned/reviewed with
the suffix 'ISSUER NOT COOPERATING'. These ratings lack a forward
looking component as it is arrived at without any management
interaction and is based on best available or limited or dated
information on the company.
Detailed Rationale
Despite repeated attempts to engage with the management, CRISIL
failed to receive any information on either the financial
performance or strategic intent of NTS, which restricts CRISIL's
ability to take a forward looking view on the entity's credit
quality. CRISIL believes information available on NTS is consistent
with 'Scenario 1' outlined in the 'Framework for Assessing
Consistency of Information with CRISIL BB' rating category or
lower'.
Based on the last available information, the ratings on bank
facilities of NTS continues to be 'CRISIL D Issuer not
cooperating'.
Incorporated on March 15, 2013, and promoted by Mr. Nandkishor T
Sonawane, NTS currently processes and distributes milk and milk
products. It has a milk processing capacity of 20,000 litres per
day (lpd) at Bhadane in Dhule (Maharashtra). It is setting up a new
unit at the same location for an additional milk processing
capacity of 50,000 lpd and a facility to manufacture value-added
products.
OM SHIV: CRISIL Maintains 'B' Rating in Not Cooperating
-------------------------------------------------------
CRISIL said the ratings on bank facilities of Om Shiv Foods (OSF)
continues to be 'CRISIL B/Stable Issuer not cooperating'.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Cash Credit 12 CRISIL B/Stable (ISSUER NOT
COOPERATING)
Term Loan 12 CRISIL B/Stable (ISSUER NOT
COOPERATING)
CRISIL has been consistently following up with OSF for obtaining
information through letters and emails dated June 29, 2019 and
December 9, 2019 among others, apart from telephonic communication.
However, the issuer has remained non cooperative.
'The investors, lenders and all other market participants should
exercise due caution while using the rating assigned/reviewed with
the suffix 'ISSUER NOT COOPERATING'. These ratings lack a forward
looking component as it is arrived at without any management
interaction and is based on best available or limited or dated
information on the company.
Detailed Rationale
Despite repeated attempts to engage with the management, CRISIL
failed to receive any information on either the financial
performance or strategic intent of OSF, which restricts CRISIL's
ability to take a forward looking view on the entity's credit
quality. CRISIL believes information available on OSF is consistent
with 'Scenario 1' outlined in the 'Framework for Assessing
Consistency of Information with CRISIL BB' rating category or
lower'.
Based on the last available information, the ratings on bank
facilities of OSF continues to be 'CRISIL B/Stable Issuer not
cooperating'.
Established in 2017 as a partnership firm by Ms. Saroj Sharma, Ms.
Pushpa Saravagi, Mr. Ajay Mittal, Mr. Vijay Kumar Mittal, and Mr.
Sonam Sharma, OSF is setting up a rice milling unit in Gwalior,
Madhya Pradesh.
OM THREADS: CRISIL Lowers Rating on INR9.3cr LT Loan to B+
----------------------------------------------------------
CRISIL has revised the ratings on bank facilities of OM Threads
Limited (OMTL) to 'CRISIL B+/Stable Issuer not cooperating'.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Cash Credit 3 CRISIL B+/Stable (ISSUER NOT
COOPERATING; Revised from
'CRISIL BB/Stable ISSUER NOT
COOPERATING')
Long Term Loan 9.3 CRISIL B+/Stable (ISSUER NOT
COOPERATING; Revised from
'CRISIL BB/Stable ISSUER NOT
COOPERATING')
CRISIL has been consistently following up with OMTL for obtaining
information through letters and emails dated November 30, 2019 and
December 9, 2019 among others, apart from telephonic communication.
However, the issuer has remained non cooperative.
'The investors, lenders and all other market participants should
exercise due caution while using the rating assigned/reviewed with
the suffix 'ISSUER NOT COOPERATING'. These ratings lack a forward
looking component as it is arrived at without any management
interaction and is based on best available or limited or dated
information on the company.
Detailed Rationale
Despite repeated attempts to engage with the management, CRISIL
failed to receive any information on either the financial
performance or strategic intent of OMTL, which restricts CRISIL's
ability to take a forward looking view on the entity's credit
quality. CRISIL believes information available on OMTL is
consistent with 'Scenario 1' outlined in the 'Framework for
Assessing Consistency of Information with CRISIL BB' rating
category or lower'.
Based on the last available information, the ratings on bank
facilities of OMTL Revised to 'CRISIL B+/Stable Issuer not
cooperating'.
Incorporated by Mr. Sanjeev Kumar & his friends in June 2014, OMTL
manufactures cotton yarn in the counts of 10, 12 and 14. The
company has production capacity of 15 tonne per day and is located
at Pataran, near Patiala.
ORCHARD FOODS: CRISIL Maintains 'D' Rating in Not Cooperating
-------------------------------------------------------------
CRISIL said the ratings on bank facilities of Orchard Foods Private
Limited (Orchard) continues to be 'CRISIL D Issuer not
cooperating'.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Cash Credit 5 CRISIL D (ISSUER NOT
COOPERATING)
Long Term Loan 0.3 CRISIL D (ISSUER NOT
COOPERATING)
Proposed Long Term
Bank Loan Facility 0.2 CRISIL D (ISSUER NOT
COOPERATING)
CRISIL has been consistently following up with Orchard for
obtaining information through letters and emails dated June 29,
2019 and December 9, 2019 among others, apart from telephonic
communication. However, the issuer has remained non cooperative.
'The investors, lenders and all other market participants should
exercise due caution while using the rating assigned/reviewed with
the suffix 'ISSUER NOT COOPERATING'. These ratings lack a forward
looking component as it is arrived at without any management
interaction and is based on best available or limited or dated
information on the company.
Detailed Rationale
Despite repeated attempts to engage with the management, CRISIL
failed to receive any information on either the financial
performance or strategic intent of Orchard, which restricts
CRISIL's ability to take a forward looking view on the entity's
credit quality. CRISIL believes information available on Orchard is
consistent with 'Scenario 1' outlined in the 'Framework for
Assessing Consistency of Information with CRISIL BB' rating
category or lower'.
Based on the last available information, the ratings on bank
facilities of Orchard continues to be 'CRISIL D Issuer not
cooperating'.
Set up in 2013 in Thiruvarur (Tamil Nadu) by late Mr A S Sharath
Chandran, his son Mr Shiyaam and Ms.R S Sumathi, Orchard trades in
pulses like toor dal, moong dal, chick peas and green peas.
PRAKHHYAT INFRAPROJECTS: CRISIL Keeps D Rating in Not Cooperating
-----------------------------------------------------------------
CRISIL said the ratings on bank facilities of Prakhhyat
Infraprojects Private Limited (PIPL) continues to be 'CRISIL D
Issuer not cooperating'.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Drop Line 5 CRISIL D (ISSUER NOT
Overdraft COOPERATING)
Facility
Proposed Long Term 3 CRISIL D (ISSUER NOT
Bank Loan Facility COOPERATING)
Term Loan 19 CRISIL D (ISSUER NOT
COOPERATING)
CRISIL has been consistently following up with PIPL for obtaining
information through letters and emails dated June 29, 2019 and
December 9, 2019 among others, apart from telephonic communication.
However, the issuer has remained non cooperative.
'The investors, lenders and all other market participants should
exercise due caution while using the rating assigned/reviewed with
the suffix 'ISSUER NOT COOPERATING'. These ratings lack a forward
looking component as it is arrived at without any management
interaction and is based on best available or limited or dated
information on the company.
Detailed Rationale
Despite repeated attempts to engage with the management, CRISIL
failed to receive any information on either the financial
performance or strategic intent of PIPL, which restricts CRISIL's
ability to take a forward looking view on the entity's credit
quality. CRISIL believes information available on PIPL is
consistent with 'Scenario 1' outlined in the 'Framework for
Assessing Consistency of Information with CRISIL BB' rating
category or lower'.
Based on the last available information, the ratings on bank
facilities of PIPL continues to be 'CRISIL D Issuer not
cooperating'.
PIPL was promoted in 2008 by Mr. Naresh Sharma, Mr. Rakesh Jain,
Mr. Sandeep Bagla, Mr. Sumeet Balotia, Mr. Manish Shah, and Mr.
Satyanarayan Rathi. The promoters are business acquaintances with
interests mainly in the textile sector. The company develops
commercial real estate and is implementing a commercial project, K
Square, comprising warehouses and industrial buildings near
Bhiwandi (Maharashtra). Its registered office is in Mumbai.
R-TECH PROMOTERS: CARE Lowers Rating on INR11.30cr Loan to D
------------------------------------------------------------
CARE Ratings revised the ratings on certain bank facilities of
R-Tech promoters Private Limited (RPPL), as:
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long term Bank 11.30 CARE D Revised from
Facilities CARE BB+; Stable
Detailed Rationale & Key Rating Drivers
The revision in the rating assigned to the bank facilities of RPPL
is primarily on account of delays in debt servicing by the
company.
Detailed description of the key rating drivers
Key Rating Weaknesses
Delays in debt servicing
As per the auditor report for FY19, there were instances of delays
in debt servicing by the company. Further, the banker has confirmed
there were irregularities in debt servicing during the month of
September, 2019.
Gurgaon (Haryana) based R-Tech Promoters Private Limited (RPPL) was
incorporated by Mr. Rajesh Kumar Yadav, Ms. Poona Yadav and Mr.
Rajendra Kumar Yadav in 2012 with an objective to carry out real
estate activity. RPPL belongs to R-tech Group, which has completed
various real estate projects through various group concerns.
RPPL was incorporated with a purpose to construct two commercial
projects, having total saleable area of 8 lakh square feet (lsf) in
the name of Capital Highstreet and Capital Highway Arcade located
at Bhiwadi and Behror respectively.
RAJASTHAN CYLINDERS: CARE Lowers Rating on INR6.5cr Loan to B
-------------------------------------------------------------
CARE Ratings revised the ratings on certain bank facilities of
Rajasthan Cylinders & Containers Limited (RCCL), as:
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long-term Bank 6.50 CARE B; ISSUER NOT COOPERATING;
Facilities Revised from CARE B+; Stable
Detailed Rationale & Key Rating Drivers
The revision in the rating of RCCL is on account of decrease in
scale of operations and incurring of net losses in FY19 (refers to
the period from April 1 to March 31) as well as in H1FY20 (refer to
the period from April 1 to September 30) with the expectation of
further decline in scale of operations and incurring of higher
losses in FY20.
The rating of RCCL continues to remain constrained on account of
its small scale of operations with cash losses, weak debt coverage
indicators and poor liquidity position. The rating has further
remained constrained due to susceptibility of margins to volatility
in raw material prices and highly competitive industry coupled with
higher business risk associated with tender
based orders. The rating, however, continues to take comfort from
experienced promoter with long track record, reputed albeit
concentrated clientele base and moderate capital structure.
Rating Sensitivities
Positive Factors
* Substantial increase in scale of operations while reporting
operating, cash as well as net profit
* Improvement in debt coverage indicators marked by positive total
debt to GCA and interest coverage of at least 1 time
Negative Factors
* Significant decline in total operating income (TOI) from
envisaged level and increase in net losses from current level
* Overall gearing deteriorating beyond 2 times.
* Non-receipt of new orders from Oil Marketing Companies (OMCs)
Detailed description of the key rating drivers
Key Rating Weaknesses
Small scale of operations and tender driven nature of operations:
Despite established track record of nearly 4 decades, RCCL' s scale
of operations continued to remain small marked by the Total
Operating Income (TOI) of INR54.70 crore in FY19 which declined by
nearly 5% on y-o-y basis on account of decline in revenue of valve
& regulator segment. Sales from valve & regulator segment declined
from INR31.94 crore in FY18 to INR20.98 crore FY19 on account of
irregular and inconsistent orders from the Oil Marketing Companies
(OMCs). Further, during FY19, OMCs did not place any order for
supply of cylinders which subsequently affected supply of valves as
well. Although, the sales volume and average sales realization for
cylinder segment increased by 11% each in FY19 on y-o-y basis, the
same has decreased in H1FY20. The company' s scale of operations
has declined in H1FY20 by 44.25% to INR12.61crore on y-o-y basis
and the company expects its scale of operations to decline in FY20
on y-o-y basis on account of non-receipt of fresh orders for
cylinders from OMCs. LPG cylinders are procured by OMCs by way of
invitation of tenders; RCCL faces stiff competition from other
established players in terms of bidding. Further due to limited
number of buyers coupled with lower bargaining power also put
pressure on profitability of the company. As the major business of
the company is through the tender-based system, therefore, the
growth of the business depends on its ability to successfully bid
for the tenders and emerge as the lowest bidder. Furthermore, any
changes in the OMC' s policy towards procurement are likely to
affect the revenues of the company.
Operating as well as cash losses along with susceptibility of
margins to volatility in raw material prices and weak debt coverage
indicators: Owing to tender driven nature of operations
characterised by fixed mark-ups and lower bargaining power, the
profitability of the company remained thin. The company incurred
operating as well as cash losses in FY19 on account of execution of
loss making orders for supply of cylinders and valves. Furthermore,
profitability margins fluctuate on account of volatility in raw
material prices, which is mainly Hot Rolled (HR) Coils of LPG grade
steel and brass rods for manufacturing of valves. RCCL mainly
procures HR Coils from Steel Authority of India ltd, JSW Steel
Ltd., while brass rods are procured from local manufacturer.
Furthermore raw material accounts for nearly 68% of total cost of
sales and prices of the same have remained inherently volatile
therefore any adverse fluctuation in the price movement would
impact the profitability as RCCL is able to pass on the price
change to customers to certain extents mainly due to price
escalation clause for foils/sheets only in the tenders.
With decline in TOI coupled with high fixed cost the company
incurred operating and net loss of INR1.85 crore and INR2.58 crore
respectively in FY19 as against PBILDT of INR1.62 crore and net
loss of INR0.27 crore in FY18. The company has also reported net
loss of INR1.83crore in H1FY20 and expects further widening of its
net loss in FY20 on y-o-y basis. Further, debt coverage indicators
also stood weak due to operating as well as cash loss in FY19.
Key rating strengths
Experienced promoters and established track record of operations:
RCCL was promoted by Mr. S. G. Bajoria, who has extensive
experience of more than 4 decades in various business activities.
He was one of the founder promoter and chairman of RCCL and looked
after the overall operations of the company. However, he ceased to
be Chairman of the company from March 2015 due to health concerns.
Currently Mr. Ashutosh Bajoria, son of Mr S. G. Bajoria is the
managing director of RCCL having experience of more than 25 years.
He looks after the overall operations of the company. Further the
promoters are supported by qualified team of experience and
qualified professionals. Further, the promoters provide support to
the company in the form of unsecured loans from time to time as and
when required. The promoter group infused unsecured loans of
INR1.04crore in H1FY20 to support the operations as well as debt
servicing of the company.
Reputed customers base albeit customer concentration risk: RCCL' s
revenues are primarily derived from the supply of LPG cylinders to
the public sector oil marketing companies (OMC). During FY19, the
total sales to the top three companies accounted for 88% (88% in
FY18) of gross sales made during the year. The major clients
include Indian Oil Corporation Limited (contributed ~23%), Bharat
Petroleum Corporation Limited (contributed 26%) and Hindustan
Petroleum Corporation Limited (contributed 39%). Hence, reliance on
three customers for the overall sales exposes the company to
customer concentration risk. However, RCCL has long-standing
relationship with these OMCs for nearly four decades which offsets
the risk to an extent. Currently, RCCL is also doing bottling for
Divine Enterprises (Gas One).
Moderate capital structure: The capital structure of RCCL continued
to remain moderate with an overall gearing of 0.65 times as on
March 31, 2019; deteriorated marginally from 0.56 times as on March
31, 2018 mainly on account of decline in net-worth due to net loss
incurred in FY19.
Poor liquidity: Liquidity position of the company stood poor marked
by net loss and cash loss incurred in FY19 and H1FY20 and expected
to incur cash losses in FY20 as well. Although the company does not
have any long term debt repayment obligation, utilisation of fund
based limits stood high at 93% during last 12 months ending
December, 2019. Further, the company has free cash and bank balance
of INR1.23 crore as on March 31, 2019. Operating cycle of the
company improved from 60 days in FY18 to 40 days in FY19 on account
of higher realisation of debtors. Further, RCCL' s cash flow from
operating activities improved to INR1.81 crore in FY19 from INR0.44
crore in FY18 on account realisation of debtors. The processing
time for manufacturing of cylinders is anywhere from 25-30 days,
Further, the company keeps buffer stock of raw material to carry
out its production activities uninterruptedly which resulted in to
an average inventory period of 55 days in FY19. Current ratio of
the company stood moderate at 1.66 times as on March 31, 2019 as
against 1.86 times as on March 31, 2018.
Incorporated in December 1980, Jaipur Rajasthan, based Rajasthan
Cylinders & Containers Limited (RCCL) is BSE listed and was
promoted by Mr. S. G. Bajoria along with his family members. RCCL
is part of Jaipur based Bajoria group which is also engaged in
manufacturing of Extra Neutral Alcohol (ENA), Rectified Spirit (RS)
and Country Liquor (CL), Investment in Shares of Other Companies,
Trading of Jute & Jute Products through other group entities mainly
Agribiotech Industries Limited (ABIL; rated: CARE B+; Stable) and
Beekay Niryat Limited (BNL; listed on BSE) and Rigmadrirappa
Investment Private Limited.
SHILPA ELECTRICAL: CARE Lowers Rating on INR9.0cr Loans to D
------------------------------------------------------------
CARE Ratings revised the ratings on certain bank facilities of
Shilpa Electrical Engineers (India) Private Limited [SEEPL], as:
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long term Bank 3.50 CARE D; ISSUER NOT COOPERATING;
facilities Revised from CARE B; Stable on
the basis of best available
information
Short-term Bank 5.50 CARE D; ISSUER NOT COOPERATING;
Facilities Revised from CARE A4 on the
basis of best available
information
Detailed Rationale & Key Rating Drivers
CARE had, vide its press release dated dated March 27, 2019, placed
the rating(s) of SEEPL under the 'Issuer non-coopearting' category
as SEEPL had failed to provide information for monitoring of the
rating. In line with the extant SEBI guidelines, CARE has reviewed
the rating on the basis of the best available information which
however, in CARE's opinion is not sufficient to arrive at a fair
rating.
Users of this rating (including investors, lenders and the public
at large) are hence requested to exercise caution while using the
above rating.
Detailed description of the key rating drivers
The rating revision to the bank facilities of Shilpa Electrical
Engineers(India) Private Limited is on account of overdrawing's in
company's cash credit account due to poor liquidity.
Key Rating Weakness
Overdue in cash credit for more than 30 days
Due to strained liquidity position resulting in overdrawing's in
cash credit account for more than 30 days.
Key Rating Strengths
Experienced promoters with established track record
SEEPL was promoted by Mr. G. Sudhakar Reddy in 1995 as a
proprietary concern. The promoter has more than two decades of
experience in the electrical industry.
Shilpa Electrical Engineers (India) Private Limited [SEEPL] was
incorporated on August 29, 2007. SEEPL is engaged in execution of
electrical contracts for more than two decades. The company was
promoted by Mr. G. Sudhakar Reddy.
SHREE GEETA: CARE Maintains 'D' Rating in Not Cooperating
---------------------------------------------------------
CARE Ratings said the rating for the bank facilities of Shree Geeta
Textile Mills Private Limited (SGTMPL) continues to remain in the
'Issuer Not Cooperating' category.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long-term Bank 43.81 CARE D; ISSUER NOT COOPERATING;
Facilities Based on best available
Information
Detailed Rationale & Key rating Drivers
CARE has been seeking information from SGTMPL to monitor the
rating(s) vide email communications/letters dated January 7, 2020,
January 8, 2020 and January 10, 2020 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.
Further, SGTMPL has not paid the surveillance fees for the rating
exercise as agreed to in its Rating Agreement. Shree Geeta Textile
Mills Private Limited's bank facilities will now be denoted as CARE
D; ISSUER NOT COOPERATING.
Users of this rating (including investors, lenders and the public
at large) are hence requested to exercise caution while
using the above rating(s).
Detailed description of the key rating drivers: At the time of last
rating on December 19, 2019, the following were the rating
strengths and weaknesses
Key Rating Weakness
Delay in debt servicing owing to poor liquidity position
As per banker interaction, there are ongoing delays in debt
servicing owing to poor liquidity position.
Shree Geeta Textile Mills Private Limited (SGTM) was established in
2008 by Madhya Pradesh based Mittal family with an objective to set
up a greenfield plant for cotton ginning & pressing, spinning for
manufacturing of cotton yarn and knitting of cotton yarn. SGTM has
completed its project in phase wise and started commercial
operations of cotton ginning & pressing and spinning from November,
2015 and knitting of cotton yarn from February 2016. The company
manufactures 100% cotton yarn of 28 counts (average) which finds
application in the manufacturing of hosiery garments and bed
sheets. The plant of the company has total installed capacity 10
tons per day for manufacturing of cotton yarn and 10 tons per day
for knitting of cotton yarn.
SHREE SUKHAKARTA: Ind-Ra Withdraws 'D' Long Term Issuer Rating
--------------------------------------------------------------
India Ratings and Research (Ind-Ra) has withdrawn Shree Sukhakarta
Developers Private Limited's (SSDPL) Long-Term Issuer Rating of
'IND D (ISSUER NOT COOPERATING)'.
The instrument-wise rating action is:
-- INR3.50 bil. NCDs ISIN# INE261P07023 issued on December 30,
2016 14% coupon rate due on September 2020 is withdrawn.
KEY RATING DRIVERS
Ind-Ra is no longer required to maintain the ratings, as the agency
has received a confirmation from the lenders that the loan facility
has been paid in full.
COMPANY PROFILE
Shree Sukhakarta Developers, incorporated in 2013, is an SPV set up
by the Ruparel Group for the execution of its project, Ariana, at
Sewri in Mumbai. The group primarily undertakes real-estate
projects pertaining to slum rehabilitation and redevelopment of
dilapidated buildings.
TECHNOFAB ENGINEERING: Insolvency Resolution Process Case Summary
-----------------------------------------------------------------
Debtor: M/s. Technofab Engineering Limited
Registered office:
913, Hemkunt Chambers 89
Nehru Place
New Delhi 110019
Project office:
Plot 5, Sector-27C
Mathura Road
Faridabad 121003
Haryana
Insolvency Commencement Date: January 30, 2020
Court: National Company Law Tribunal, Noida Bench
Estimated date of closure of
insolvency resolution process: July 28, 2020
Insolvency professional: Anurag Gupta
Interim Resolution
Professional: Anurag Gupta
498, Niti Khand-1
Indirapuram
Ghaziabad 201014
E-mail: anurag.gupta.fcs@gmail.com
- and -
C/o Anurag & Associates
Awfis, 7th Floor, Tower-B
The Corenthum, Sector-62
Noida 201309
E-mail: cirp.technofab@gmail.com
Last date for
submission of claims: February 13, 2020
=================
I N D O N E S I A
=================
[*] INDONESIA: To Liquidate, Merge Underperforming SOEs
-------------------------------------------------------
The Jakarta Post reports that the State-Owned Enterprises (SOEs)
Ministry will close down or merge state-owned companies that have
consistently failed to post profits as part of the government's
restructuring of SEOs, Deputy SOE Minister Kartika "Tiko"
Wirjoatmodjo said in Jakarta on Feb. 6.
According to the report, Tiko said that all underperforming SEO's
were currently under review, as the ministry looked to figure out
which should be merged and which should be liquidated. The review
will also determine which companies will focus their operations on
public services, he added.
"[SOEs Minister] Pak Erick [Thohir] wants to reduce the number of
state-owned firms to 100 from 142 at present in order to improve
efficiency," he said on the sidelines of the Mandiri Investment
Forum 2020 in Jakarta on Feb. 5, the Jakarta Post relays.
The report adds that the ministry will also enlist the help of
state-owned asset management company PT Perusahaan Pengelolaan Aset
(PPA) to assess which SOEs need to be merged or liquidated, said
Tiko.
However, before the ministry can make such big decisions, it has to
wait on a new regulation that will give the SOEs Ministry broader
managerial authority, the report notes.
"We're still waiting on the new regulation because currently, the
action can only be taken by the Finance Ministry," the report
quotes Tiko as saying.
Under Government Regulation No. 41/2003, the SOEs Ministry must
obtain permission from the Finance Ministry, in its capacity as a
shareholder, to carry out liquidation, mergers and spinoffs of
state-owned companies, as well as capital injections, according to
the Jakarta Post.
Minister Erick proposed last year that the regulation be revised so
the ministry would no longer need to obtain approval from the
Finance Ministry to restructure state enterprises, the report
recalls.
There are 142 SOEs at present, but about 70 percent of the profits,
which totaled Rp 210 trillion [US$1.5 billion] last year, came only
from 15 SOEs, Erick said in December 2019, the Jakarta Post adds.
===============
M A L A Y S I A
===============
PRIME GLOBAL: Incurs $267K Net Loss in Fiscal 2019
--------------------------------------------------
Prime Global Capital Group Incorporated filed with the Securities
and Exchange Commission its Annual Report on Form 10-K reporting a
net loss of US$267,321 on US$1.92 million of net total revenues for
the year ended Oct. 31, 2019, compared to a net loss of US$553,962
on US$1.53 million of net total revenues for the year ended Oct.
31, 2018.
As of Oct. 31, 2019, the Company had US$44.47 million in total
assets, US$17.63 million in total liabilities, and US$26.84 million
in total equity.
As of Oct. 31, 2019, the Company had cash and cash equivalents of
US$198,113, accounts receivable of US$12,956.
The Company's ratio of current assets to current liabilities was
0.28:1 and 0.36:1 as of Oct. 31, 2019 and 2018, respectively. The
Company expects to incur significantly greater expenses in the near
future, including the contractual obligations that it has assumed,
to begin development activities. The Company also expects its
general and administrative expenses to increase as it expands its
finance and administrative staff, and add infrastructure. The
Company has never paid dividends on its Common Stock. Its present
policy is to apply cash to investments in product development,
acquisitions or expansion; consequently, it does not expect to pay
dividends on Common Stock in the foreseeable future.
Prime Global said, "Our continuation as a going concern is
dependent upon improving our profitability and the continuing
financial support from our stockholders. Our sources of capital in
the past have included the sale of equity securities, which include
common stock sold in private transactions and public offerings,
capital leases and short-term and long-term debts. While we believe
that we will obtain external financing and the existing
shareholders will continue to provide the additional cash to meet
our obligations as they become due, there can be no assurance that
we will be able to raise such additional capital resources on
satisfactory terms. We believe that our current cash and other
sources of liquidity discussed below are adequate to support
operations for at least the next 12 months."
ShineWing Australia, in Melbourne, Australia, the Company's
independent accounting firm, issued a "going concern" qualification
in its report dated Jan. 28, 2020 citing that the Company has a
working capital deficiency, and accumulated deficit from recurring
net losses maturing in less than one year as of Oct. 31, 2019. All
these factors raise substantial doubt about its ability to continue
as a going concern.
A full-text copy of the Form 10-K is available for free at the
SEC's website at:
https://is.gd/eK9d8G
About Prime Global
Headquartered in Kuala Lumpur, Malaysia, Prime Global Capital Group
Incorporated -- http://www.pgcg.cc-- through its subsidiaries, is
principally engaged in the operation of a durian plantation,
leasing and development of the operation of oil palm and durian
plantation, commercial and residential real estate properties in
Malaysia.
=================
S I N G A P O R E
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CHINA FISHERY: Kirkland & Ellis Updates on Noteholders
------------------------------------------------------
In the Chapter 11 cases of China Fishery Group Limited (Cayman), et
al., the law firm of Kirkland & Ellis LLP submitted an amended
verified statement under Rule 2019 of the Federal Rules of
Bankruptcy Procedure, to disclose an updated list of Ad Hoc Group
that it is representing.
K&E's representation of certain entities that hold, or that act as
investment manager of or advisor to certain funds, controlled
accounts, and/or other entities that hold or are beneficial owners
of the 9.75% Senior Notes Due 2019, the Club Loan Facility
obligations that matured as of 2018, and claims arising under that
certain $35 million facility letter dated August 26, 2014 among
Bank of America, N.A., China Fisheries International Limited
(Samoa), and South Pacific Shipping Agency Limited (BVI). K&E
previously represented certain entities in their capacities as
holders of the Senior Notes.
K&E represents only the Ad Hoc Group, and does not represent or
purport to represent any entity other than the Ad Hoc Group, in
connection with the Debtors' chapter 11 cases. In addition, the Ad
Hoc Group does not represent or purport to represent any other
entity in connection with the Debtors' chapter 11 cases at this
time.
As of Feb. 3, 2020, the Committee Members and their disclosable
economic interests are:
Burlington Loan Management DAC
Pinnacle 2
Eastpoint Business Park Dublin 3
Ireland
* $65,571,000 principal amount of Senior Notes
* $53,250,000 principal amount of Club Loans
Cowell & Lee Asia Credit Opportunities Fund
15-01 Ruttonjee House
11 Duddell Street
Central Hong Kong
People's Republic of China
* $47,282,000 principal amount of Senior Notes
Monarch Alternative Capital LP
50-52 Welbeck Street
1st Floor
London, United Kingdom
W1G 9HL
* $32,101,000 principal amount of Senior Notes
* $115,629,369 principal amount of Club Loans
* $30,998,083.56 of CF Facility Claims
VCFG, LLC
3600 West 80th Street Suite 225
Minneapolis, MN 55431
* $80,000,000 principal amount of Club Loans
SC Lowy Primary Investments, Ltd.
8 Queens Road Central 17th Floor
Hong Kong
People's Republic of China
* $9,874,000 principal amount of Senior Notes
* $18,500,000 principal amount of Club Loans
Arkkan Capital Management Limited
8 Queens Road Central 23rd Floor
Hong Kong
People's Republic of China
* $7,000,000 principal amount of Senior Notes
* $12,000,000 principal amount of Club Loans
Deutsche Bank, London Branch
c/o: Deutsche Bank AG
Hong Kong Branch
61/F, International Commerce Centre
1 Austin Road West
Kowloon, Hong Kong
* $185,000 principal amount of Senior Notes
* $18,173,076.63 principal amount of Club Loans
Counsel to the Ad Hoc Group can be reached at:
KIRKLAND & ELLIS LLP
KIRKLAND & ELLIS INTERNATIONAL LLP
Patrick J. Nash, Jr., P.C., Esq.
Gregory F. Pesce, Esq.
Heidi M. Hockberger, Esq.
300 North LaSalle
Chicago, IL 60654
Telephone: (312) 862-2000
Facsimile: (312) 862-2200
A copy of the Rule 2019 filing, downloaded from PacerMonitor.com,
is available at https://is.gd/7Puvhs
About China Fishery Group
China Fishery Group Limited (Cayman) and its affiliates sought
protection under Chapter 11 of the Bankruptcy Code (Bankr. S.D.N.Y.
Lead Case No. 16-11895) on June 30, 2016.
In the petition signed by CEO Ng Puay Yee, China Fishery Group was
estimated to have assets at $500 million to $1 billion and debt at
$10 million to $50 million.
The cases are assigned to Judge James L. Garrity Jr.
Weil, Gotshal & Manges LLP has been tapped to serve as lead
bankruptcy counsel for China Fishery and its affiliates other than
CFG Peru Investments Pte. Limited (Singapore). Weil Gotshal
replaces Meyer, Suozzi, English & Klein, P.C., the law firm
initially hired by the Debtors. The Debtors have also tapped
Klestadt Winters Jureller Southard & Stevens, LLP, as conflict
counsel; Goldin Associates, LLC, as financial advisor; RSR
Consulting LLC as restructuring consultant; and Epiq Bankruptcy
Solutions, LLC, as administrative agent. Kwok Yih & Chan serves as
special counsel.
On Nov. 10, 2016, William Brandt, Jr., was appointed as Chapter 11
trustee for CFG Peru Investments Pte. Limited (Singapore), one of
the Debtors. Skadden, Arps, Slate, Meagher & Flom LLP serves as
the trustee's bankruptcy counsel; Hogan Lovells US LLP serves as
special counsel; and Quinn Emanuel Urquhart & Sullivan, LLP, serves
as special litigation counsel.
HONESTBEE: Proposes to Repay Creditors 3% in Cash, Rest in Equity
-----------------------------------------------------------------
Sharanya Pillai at The Business Times reports that former honestbee
chairman Brian Koo and his venture firm, Formation Group, plan to
use a cash payment to settle 3 per cent of what the embattled
startup owes to about 800 creditors.
BT relates the remaining 97 per cent will be repaid via the
issuance of shares in a new Singapore entity that will own
honestbee's assets, under the startup's proposed scheme of
arrangement to restructure its US$209 million worth of outstanding
debt.
Separately, there are more than 1,000 trade creditors that are owed
S$500 or less each. They will be repaid in full and thus be
excluded from the scheme, sources told BT. These debts amounted to
over S$150,000 as at Dec. 31.
According to BT, the sources said FLK Holdings, a US-incorporated
vehicle owned by LG scion Mr Koo and Formation Group, plans to
inject fresh funds of US$7 million into honestbee for the cash
payment to the 800-odd creditors.
The rest of what is owed will be converted to equity in a
Singapore-incorporated company, which will take over the grocery
delivery startup's assets, the report relates. Creditors will
receive shares in this new firm, although the conversion ratio and
issue price of the shares have not been revealed to creditors.
If the scheme gets the green light, creditors will own between 70
per cent and 75 per cent of the new Singapore firm, BT understands.
At the lower end of this range, this could value the firm at about
US$290 million, assuming creditors are issued about US$202 million
worth of shares.
The single-largest shareholder will likely be the vehicle A
Honestbee, which is majority-owned by Yesco, Mr Koo's family
business. Formation Group and Mr Koo will also have significant
stakes, both directly and via FLK, the report notes.
BT says Mr. Koo was an early backer of honestbee, and took over as
interim chief executive officer (CEO) and later as chairman of the
startup after its troubles surfaced in mid-2019.
He has since resigned as chairman, while regulatory filings
indicate that he remains a director. However, an honestbee
spokesman told BT that Mr. Koo had resigned as director of the firm
on Sept. 12 last year.
honestbee's former CEO Joel Sng still owns about 82 per cent of the
company's ordinary shares, which makes it likely that the proposed
scheme will require his vote to be passed, BT notes.
Post-restructuring, Mr. Sng's stake could be heavily diluted.
Sources told BT that honestbee plans to group all eligible
creditors within the same class to vote on the scheme. For the
scheme to be approved, at least 50 per cent of the number of voting
creditors and at least 75 per cent of the debt value they represent
must vote in favor of it. The scheme also requires the High Court's
approval.
In previous court filings, honestbee's restructuring advisor DHC
Capital had said that creditors would receive between zero and one
cent on the dollar if the company were to be liquidated, the report
says.
Formation Group is honestbee's sole secured lender, giving it
seniority over all other financial and trade creditors, BT
discloses. honestbee had previously taken out US$4 million in loans
from two funds under the venture firm that were secured by charges
over all of the startup's assets.
honestbee is understood to not have received any other firm offers
from potential white knights thus far, BT states. In December, The
Ken reported that honestbee was in talks with Philippine
conglomerate JG Summit over a potential rescue deal.
About honestbee
Headquartered in Singapore, Honestbee Pte. Ltd. --
https://honestbee.sg/ -- is an online grocery and food delivery
service as its core business, a concierge service, and also aparcel
delivery service for its B2B clients.
As reported in the Troubled Company Reporter-Asia Pacific on Aug.
7, 2019, Inside Retail Asia said that sinking in debts of around
US$180 million, Honestbee is seeking court protection from
creditors to allow it to restructure. The company has applied to
the High Court to commence a process which reportedly would give it
six months protection from creditors lodging winding up procedures
or other legal attempts to recover what they are owed.
Honestbee has received demands from creditors claiming SGD6
million, and owes about US$209 million to its largest creditors,
the embattled grocery startup revealed in an affidavit filed at a
Singapore High Court pre-trial conference on August 6, according to
The Business Times.
*********
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 2020. All rights reserved. ISSN: 1520-9482.
This material is copyrighted and any commercial use, resale or
publication in any form (including e-mail forwarding,
electronic re-mailing and photocopying) is strictly prohibited
without prior written permission of the publishers.
Information contained herein is obtained from sources believed
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TCR-AP subscription rate is US$775 for 6 months delivered via e-
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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 ***