/raid1/www/Hosts/bankrupt/TCRAP_Public/200311.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
Wednesday, March 11, 2020, Vol. 23, No. 51
Headlines
A U S T R A L I A
50-SIXONE CATERING: Clifton Hall Appointed as Liquidators
BESTEX PTY: First Creditors' Meeting Set for March 18
DEVILS HOLDINGS: Second Creditors' Meeting Set for March 17
HORTH INVESTMENTS: First Creditors' Meeting Set for March 18
HOWCON PTY: Second Creditors' Meeting Set for March 17
KIKKI K: Collapses Into Receivership; 450 Jobs at Risk
LAING NEWS: Second Creditors' Meeting Set for March 19
MISTER DEE'S: Worrells Solvency Appointed as Liquidator
RAPID FINANCE: Second Creditors' Meeting Set for March 18
TECHNOTORCH WA: First Creditors' Meeting Set for March 17
I N D I A
ADRI STEEL: CARE Assigns B+ Rating to INR14.50cr LT Loan
AIRCEL: NCLAT Dismisses DoT's plea in Licence Moratorium Matter
AKKAVILA K: CRISIL Withdraws B+ Rating on INR4.5cr Loan
ANKUR CLOTHING: CARE Assigns 'B' Rating to INR2.0cr LT Loan
ARG DEVELOPERS: CARE Lowers Rating on INR49.37cr Loan to 'D'
ASHOK SALES: CRISIL Migrates 'B' Rating to Not Cooperating
AVANTIS DREAM: CRISIL Migrates 'B+' Rating to Not Cooperating
B.N. INDUSTRIES: Ind-Ra Raises Long Term Issuer Rating to 'B+'
BILPOWER LIMITED: CRISIL Keeps 'D' Rating in Not Cooperating
BLISSFUL GARMENTS: CRISIL Migrates 'D' Rating to Not Cooperating
CALCUTTA ELECTRODES: Ind-Ra Withdraws BB-, NonCooperating Rating
EMERALD MINERAL: Insolvency Resolution Process Case Summary
G.R. ENGINEERING: Ind-Ra Affirms BB+ LT Issuer Rating, Outlook Pos.
IL&FS LTD: HSBC Files Winding Up Plea Against Unit
INDEPENDENT TV: Insolvency Resolution Process Case Summary
INDIAN MINING: Insolvency Resolution Process Case Summary
JAIN STUDIOS: Insolvency Resolution Process Case Summary
KALYAN COTTON: CRISIL Migrates B+ Rating to Not Cooperating
KALYANIKA PROMOTORS: CRISIL Withdraws D Rating on INR10cr Loan
KUNJ ROLLER: Ind-Ra Affirms 'BB+' LT Issuer Rating, Outlook Stable
MAA VAISHNO: CRISIL Withdraws D Rating on INR5.0cr Loan
MALVIKA TECHNICAL: CARE Cuts INR0.75cr Loan Rating to B+, Not Coop.
MANCHUKONDA AGROTECH: Ind-Ra Affirms BB+ LT Rating, Outlook Stable
MANGALA ELECTRICALS: CARE Lowers Rating on INR3.34cr Loan to D
MANIPUR TEA: CRISIL Upgrades Rating on INR4.8cr Loan to B-
MELZER CHEMICALS: Ind-Ra Lowers Long Term Issuer Rating to 'BB+'
NAGARJUNA HOSPITALS: CRISIL Moves 'B' Rating to Not Cooperating
NAGARSHETH SHIPBREAKERS: CRISIL Moves D Rating to Not Cooperating
NAGOORAR ENTERPRISES: CRISIL Moves 'D' Rating to Not Cooperating
NAVRANG ROADLINES: Insolvency Resolution Process Case Summary
NEELKANTH SURGICAL: Insolvency Resolution Process Case Summary
NEW ASIAN: CRISIL Migrates D Rating to Not Cooperating Category
NOBILE ICE: Insolvency Resolution Process Case Summary
ON-DOT COURIERS: Insolvency Resolution Process Case Summary
RADHA KRISHNA: Ind-Ra Lowers Issuer Rating to BB-, Outlook Stable
RADHARAMAN STAINLESS: CARE Cuts Rating on INR6.50cr Loan to B+
SHRI BAHUBALI: CRISIL Assigns B+ Rating to INR2.8cr Term Loan
SHUKRA JEWELLERY: CRISIL Lowers Rating on INR17.05cr Loan to D
SPI ENGINEERS: CARE Reaffirms B+ Rating on INR6.0cr LT Loan
SRI CHAITANYA: CARE Cuts INR8.0cr LT Loan Rating to B+, Not Coop.
SRI VYSHNAVI: CRISIL Cuts Rating on INR6cr Cash Loan to B+
SURYATAAP ENERGIES: Ind-Ra Cuts Term Loan Rating to B+, Not Coop.
SVM NONWOVENS: CRISIL Lowers Rating on INR10.6cr New Loan to D
TOPWORTH STEELS: Insolvency Resolution Process Case Summary
UNITED FORTUNE: CRISIL Lowers Rating on INR18cr Loan to 'D'
UNNATI WRITING: CRISIL Cuts Rating on INR11cr Cash Loan to 'D'
VASUNDHARA MERCHANTS: CRISIL Assigns B Rating to INR5cr Term Loan
VENESSA METALS: Insolvency Resolution Process Case Summary
VISHNURAAM TEXTILES: CRISIL Keeps 'D' Rating in Not Cooperating
VSRK CONSTRUCTIONS: CRISIL Cuts Rating on INR13cr Loan to 'D'
M A L A Y S I A
APFT BHD: To Be Delisted on March 16 Unless Appeal is Made
COMINTEL CORP: Deadline to Submit Plan Extended Until July 24
N E W Z E A L A N D
GLIDE OMARAMA: Owner Blames Ill-Suited Regulations for Insolvency
SLINKSKINS LIMITED: Goes Into Receivership; 20 Jobs Axed
S O U T H K O R E A
KOREAN AIR: President Says Coronavirus a Threat to Its Survival
- - - - -
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A U S T R A L I A
=================
50-SIXONE CATERING: Clifton Hall Appointed as Liquidators
---------------------------------------------------------
Timothy Clifton of Clifton Hall was appointed as Liquidator of
50-Sixone Catering Pty Ltd on Feb. 27, 2020.
The information sent to creditors includes voting forms in respect
of proposals requiring creditor approval. "Completed forms must be
returned by 5:00 p.m. on March 25, 2020, for your vote to be
counted," Clifton Hall said.
BESTEX PTY: First Creditors' Meeting Set for March 18
-----------------------------------------------------
A first meeting of the creditors in the proceedings of BestEx Pty.
Ltd. will be held on March 18, 2020, at 10:30 a.m. at the offices
of PCI Partners Pty Ltd, Level 8, at 179 Queen Street, in
Melbourne, Victoria.
P Newman of PCI Partners was appointed as administrator of BestEx
Pty on March 5, 2020.
DEVILS HOLDINGS: Second Creditors' Meeting Set for March 17
-----------------------------------------------------------
A second meeting of creditors in the proceedings of Devils Holdings
Pty Ltd Trading as Pipe Dreams and Formerly Trading as High
Fidelity has been set for March 17, 2020, at 10:00 a.m. at QV1
Training Room 1, Level 2, at 250 St Georges Terrace, in Perth, WA.
The purpose of the meeting is (1) to receive the report by the
Administrator about the business, property, affairs and financial
circumstances of the Company; and (2) for the creditors of the
Company to resolve whether the Company will execute a deed of
company arrangement, the administration should end, or the Company
be wound up.
Creditors wishing to attend are advised proofs and proxies should
be submitted to the Administrator by March 16, 2020, at 4:00 p.m.
Greg Mathew Prout and David Ashley Norman Hurt of WA Insolvency
Solutions were appointed as administrators of Devils Holdings on
Feb. 10, 2020.
HORTH INVESTMENTS: First Creditors' Meeting Set for March 18
------------------------------------------------------------
A first meeting of the creditors in the proceedings of Horth
Investments Pty Ltd will be held on March 18, 2020, at 10:00 a.m.
at the offices of Hogan Sprowles, Level 9, at 60 Pitt Street, in
Sydney, NSW.
Brendan Copeland and Christian Sprowles of Hogan Sprowles were
appointed as administrators of Horth Investments on March 6, 2020.
HOWCON PTY: Second Creditors' Meeting Set for March 17
------------------------------------------------------
A second meeting of creditors in the proceedings of Howcon Pty Ltd
(formerly trading as "Affordable Garage Doors" and "Country Leisure
Centre") has been set for March 17, 2020, at 11:30 a.m. at the
offices of Training Room 1, QV1 Conference Centre, Level 2, at 250
St Georges Terrace, in Perth, WA.
The purpose of the meeting is (1) to receive the report by the
Administrator about the business, property, affairs and financial
circumstances of the Company; and (2) for the creditors of the
Company to resolve whether the Company will execute a deed of
company arrangement, the administration should end, or the Company
be wound up.
Creditors wishing to attend are advised proofs and proxies should
be submitted to the Administrator by March 16, 2020, at 4:00 p.m.
David Ashley Norman Hurt and Jimmy Trpcevski of WA Insolvency
Solutions were appointed as administrators of Howcon Pty on Feb.
10, 2020.
KIKKI K: Collapses Into Receivership; 450 Jobs at Risk
------------------------------------------------------
Dominic Powell at The Sydney Morning Herald reports that Australian
stationery retailer Kikki K has been placed into receivership as
the country's brutal retail sector, coupled with "unprecedented"
external factors, continues to claim victims.
SMH relates that the company's founders expressed "profound regret
and sadness" after announcing the closure late on March 10, blaming
a "perfect storm" of conditions for the shutdown. This included
Brexit in the United Kingdom, civil unrest in Hong Kong, and a
"profound structural change" of shoppers buying more online.
Chief executive Paul Lacy also flagged a poor Christmas trading
period and an "unprecedented line up of external factors" such as
the coronavirus as reasons for the business' collapse, the report
says. "We've had the triple-whammy of soft consumer demand, the
business impact of bushfires and more recently the unprecedented
and profound impact of coronavirus which is hitting so many
businesses and countries so hard," the report quotes Mr. Lacy as
saying.
"This unprecedented line-up of external factors, particularly in
recent weeks, has really taken its toll. As we looked ahead we just
didn't have the certainty we could keep going so have had to take
this decision."
Receivers Cor Cordis were appointed to the retailer, which runs
about 65 stores across the country and a handful of locations in
the UK, Hong Kong and New Zealand after a 2016 decision to expand
the business internationally, according to SMH.
Founded in 2001 by Swedish-born entrepreneur Kristina Karlsson, the
company had revenues of about AUD80 million and 450 employees. It
was close to a capital deal with a large global partner prior to
collapse, but "ran out of time", requiring the company to be placed
into administration, SMH states.
According to SMH, Ms. Karlsson said the retailer was still an
"amazing business opportunity" but required a "big re-set and a
buyer who understands the opportunity".
"The last few weeks have been some of the most challenging of our
lives but we remain determined to find the right new partner to
continue chasing our dream, so we can get back on track for all of
the people including our wonderful team who rely in some way on
this beautiful brand," she said.
SMH adds that the company said it was business as usual, with
receiver Barry Wight saying he hoped to either restructure or sell
the company, also blaming high leasing costs as a factor in the
company's demise.
LAING NEWS: Second Creditors' Meeting Set for March 19
------------------------------------------------------
A second meeting of creditors in the proceedings of Laing News Pty
Ltd has been set for March 19, 2020, at 10:00 a.m. at 22nd Floor,
Northbank Plaza, at 69 Ann Street, in Brisbane, Queensland.
The purpose of the meeting is (1) to receive the report by the
Administrator about the business, property, affairs and financial
circumstances of the Company; and (2) for the creditors of the
Company to resolve whether the Company will execute a deed of
company arrangement, the administration should end, or the Company
be wound up.
Creditors wishing to attend are advised proofs and proxies should
be submitted to the Administrator by March 17, 2020, at 4:00 p.m.
Trent McMillen of MaC Insolvency was appointed as administrator of
Laing News on Feb. 26, 2020.
MISTER DEE'S: Worrells Solvency Appointed as Liquidator
-------------------------------------------------------
Christopher Darin, Partner at Worrells was appointed as Liquidator
of Mister Dee's Kitchen Pty Ltd and Voluntary Administrator to
Parramatta Phoenix Pty Limited to review each company's position
and reasons for failure.
The Companies operated restaurants at Oxford Village, 55- 73 St
Oxford Street, Darlinghurst and Parramatta Westfield Shopping
Centre, respectively.
Mr. Darin said "as we have just been appointed this morning, we are
still in the initial stages of gathering each company's books and
records to commence our assessment of the reasons for failure,
however the director has indicated in initial discussions that one
of the factors in the fall in turnover of the restaurants is a
reaction to the coronavirus."
RAPID FINANCE: Second Creditors' Meeting Set for March 18
---------------------------------------------------------
A second meeting of creditors in the proceedings of Rapid Finance
(Aust) Pty Ltd has been set for March 18, 2020, at 12:00 p.m. at
the offices of Rapid Finance Offices, 98 Agar Drive, in Truganina,
Victoria.
The purpose of the meeting is (1) to receive the report by the
Administrator about the business, property, affairs and financial
circumstances of the Company; and (2) for the creditors of the
Company to resolve whether the Company will execute a deed of
company arrangement, the administration should end, or the Company
be wound up.
Creditors wishing to attend are advised proofs and proxies should
be submitted to the Administrator by March 5, 2020, at 4:00 p.m.
Ben Verney -- ben@greyhouse.com.au -- of Grey House Partners was
appointed as administrator of Rapid Finance on Feb. 11, 2020.
TECHNOTORCH WA: First Creditors' Meeting Set for March 17
---------------------------------------------------------
A first meeting of the creditors in the proceedings of Technotorch
WA Pty Ltd will be held on March 17, 2020, at 9:30 a.m. at the
offices of SM Solvency Accountants, 10/144 Edward Street, in
Brisbane, Queensland.
SM Solvency Accountants were appointed as administrators of
Technotorch WA on March 6, 2020.
=========
I N D I A
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ADRI STEEL: CARE Assigns B+ Rating to INR14.50cr LT Loan
--------------------------------------------------------
CARE Ratings has assigned rating to the bank facilities of Adri
Steel Private Limited (ASPL), as:
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long-term Bank
Facilities 14.50 CARE B+; Stable Assigned
Detailed Rationale & Key Rating Drivers
The rating assigned to the bank facilities of ASPL are tempered by
short track record of business operations, modest scale of
operations with thin profitability margins, financial risk profile
marked by moderate capital structure and weak debt coverage
indicators during the review period, cyclicality of the steel
industry, highly fragmented and competitive nature of business with
intense competition from large number of players and profitability
margins are susceptible to fluctuation in raw material prices. The
rating, however, derives strength from experienced and resourceful
promoters, locational advantage and comfortable operating cycle.
Rating Sensitivities
Positive Factors
* Increase in total operating income beyond INR120.00 crore on
sustained basis
* Increase in profitability margins marked by PBILDT margin to
3.00% and PAT margin to 1.50% on sustained basis
Negative Factors
* Further deterioration in capital structure with overall gearing
increasing beyond 2.5x in future
* Elongation in working capital days
Detailed description of the key rating drivers
Key Rating Weaknesses
Short track record of business operations
Though the company incorporated in 2002, the commercial operations
have been started in August 2017 which indicated theshort track
record of business operations.
Modest scale of operations with thin profitability margins
The scale of operations marked by the total operating income stood
modest at INR101.17 crore in FY19 being first full year of
operations as compared to INR47.10 crore for 7MFY18. Further, ASPL
has registered Total operating income of INR75.42 crore during
9MFY20 (Prov.) due to repeated orders from customer coupled with
addition of new customers during the period. On account of which,
the PBILDT margin stood moderate at 2.65% in FY19 as compared to
1.52% in FY18. Further, the PAT margin remained thin at 0.33% in
FY19 due low cash accruals coupled with high interest cost on back
of increase in unsecured loans to manage day-to-day operations.
Financial risk profile marked by moderate capital structure and
weak debt coverage indicators during the review period
The capital structure of the company marked by the overall gearing
has deteriorated from 0.55x as on March 31, 2018 to 1.27x as on
March 31, 2019, however stood moderate due to subordination of
unsecured loans of INR7.25 crore from directors to bank facilities.
The debt profile of company constitutes of unsecured loans of
INR17.90 crore as against the net worth of INR11.10 crore as on
March 31, 2019. The debt coverage indicators of the firm stood
weak marked by TD/GCA and interest coverage of 32.02x and 1.27x
respectively in FY19 due to low cash accruals due to high overhead
cost during initial stage of operations. On account of which, the
total debt to GCA stood negative due to low accruals coupled with
increase in inventory and receivables during FY19.
Cyclicality of the steel industry
The steel industry is sensitive to the shifting business cycles,
including changes in the general economy, interest rates and
seasonal changes in the demand and supply conditions in the market.
Apart from the demand side fluctuations, the high capital intensive
nature of steel projects along with the inordinate delays in the
completion hinders the responsiveness of supply side to demand
movements. This results in several steel projects bunching up and
coming on stream at the same time creating the oversupply, thus
affecting the steel sales realizations.
Highly fragmented and competitive nature of business with intense
competition from large number of players
ASPL is operating in a highly fragmented and competitive market
segment marked by the presence of numerous players. Given the fact
that the entry barriers to the industry are low, the players in the
industry do not have pricing power and are exposed to competition
induced pressures on profitability.
Profitability margins are susceptible to fluctuation in raw
material prices
The main raw material for ASPL is iron and steel, which are mainly
purchased from local vendors in Hindupur, Andhra Pradesh. The raw
material prices have been volatile in the past. Going forward, the
ability of ASPL to manage the raw material risk would be crucial to
maintain its profitability.
Key Rating Strengths
Experienced and resourceful promoters
Adri Steel Private Limited (ASPL) incorporated in 2002 by Mr. Tarun
Chandak and Mr. Shubham Somani. The promoters have experience of
more than a decade in Steel Industry which has helped the company
in procuring repeat orders from the existing customers and in
acquiring new customers by providing quality products.
Locational advantage
The industry is located in Anantapur district of Andhra Pradesh
state which is one of the major industrial area in the State. This
ensures easy raw material access i.e. billets and smooth supply of
raw materials at competitive prices resulted in low
transportation cost.
Comfortable operating cycle
The company has maintained comfortable operating cycle of 45 days
in FY19 being first full year of operations. ASPL reserves the
inventory levels up to 30 days to mitigate the price fluctuation of
materials. Further, the company receives credit period up to 45
days from its suppliers and allows the credit of 30 to 35 days to
its customers. However, to manage the working capital gap ASPL has
highly relied upon the unsecured loans during FY19.
Liquidity Analysis: Stretched
The current ratio of the company stood moderate at 2.68x as on
March 31, 2019, due to high inventory and receivables as against
the current liabilities of INR6.87 crore as on March 31, 2019. The
cash and bank balances stood low at INR0.10 crore as on March 31,
2019. Its banking limits are utilized to extent of 95% during last
6 months ending January 31, 2020.
Anantapur based, Adri Steel Private Limited (ASPL), formerly known
as Stonetech Granite India Private Limited, was incorporated in
January 2002 and there were no operations. In FY2018, the company
has re-named to Adri Steel Private Limited and the main line of
business activity was manufacturing of Iron and Steel TMT (Thermo
Mechanical Treatment) bars. ASPL is promoted by Mr. Tarun Chandak
and Mr. Shubham Somani. The commercial operations started from
August 2017, with installed capacity of 60,000 MT per annum.
AIRCEL: NCLAT Dismisses DoT's plea in Licence Moratorium Matter
---------------------------------------------------------------
Livemint.com reports that the National Company Law Appellate
Tribunal (NCLAT) has dismissed the telecom department's plea citing
delay in appeal against the National Company Law Tribunal (NCLT)
order which held that the spectrum and licence of debt-ridden
Aircel cannot be taken away during the insolvency resolution
period.
The Department of Telecommunications (DoT) had appealed against an
order of the Mumbai bench of the NCLT, the report says.
In its plea, the DoT raised the issue as whether licence/spectrum
to run a telecom company could be subject to moratorium during the
insolvency proceedings or not.
However, a three-member bench of the NCLAT held that the petition
filed by the DoT was time barred under the provisions of Section 61
of the Insolvency & Bankruptcy Code, 2016, Mint relates.
Under the IBC, any appeal against order passed by the NCLT could be
filed before the appellate tribunal within 30 days and the delay
which can be condoned for reasonable cause in the NCLAT is only 15
days, according to Mint.
"This appeal was presented on February 20, 2020. Even giving the
longest rope, if we calculate the period from December 20, 2019,
the appeal is presented consuming 61 days. This being so, the
appeal is time barred and for want of jurisdiction, we cannot
entertain the appeal," said NCLAT, Mint relays.
"The appeal is dismissed as time barred," it said.
The order was passed by the National Company Law Tribunal (NCLT) on
Nov. 27, 2019.
According to the report, the NCLT order had come over the plea
filed by the resolution professional of the company over
apprehension that its license and spectrum could be suspended after
DoT issued demand notice.
Though, the NCLT in its order accepted that licence and spectrum is
an asset of DoT and Aircel has no right of ownership but said that
clauses of moratorium are "squarely applicable on this Corporate
Insolvency Resolution Process Proceedings, hence need not be
interrupted or hampered by any authority."
The NCLT further said that intent of IBC is prescribed to maximize
the assets of the company as well as to protect the value so as to
get good resolution plan for its revival, Mint relays.
". . . within the scope and ambit of Insolvency and Bankruptcy
Code, 2016 hereby instruct the concerned DoT authority not to make
any attempt to cancel the impugned license issued in favour of the
debtor company," it said.
The NCLT had in March, 2018 admitted Aircel's insolvency plea.
About Aircel Limited
Aircel Limited, along with its subsidiaries Aircel Cellular Limited
and Dishnet Wireless Limited, is a telecom service provider with a
pan India presence. Aircel offers GSM-based 2G services in all the
22 telecom circles and has also introduced 3G services in select
geographies.
As reported in the Troubled Company Reporter-Asia Pacific on March
2, 2018, Reuters said Aircel Ltd filed for bankruptcy on Feb. 28,
2018, pressured by a high debt pile and mounting losses following a
price war triggered by a telecom upstart. Talks between Aircel, 74%
owned by Malaysia's Maxis Communications Bhd, and Reliance
Communications Ltd (RCom) to combine their wireless business was
called off in late 2017 due to regulatory and legal uncertainties
and interventions by various parties, Reuters said.
Aircel, whose debt amounts to INR155 billion (US$2.38 billion),
then tried unsuccessfully to restructure its debt, Reuters related.
AKKAVILA K: CRISIL Withdraws B+ Rating on INR4.5cr Loan
-------------------------------------------------------
CRISIL has withdrawn its rating on the bank facilities of Akkavila
K Lekshmanan and Company (AKLC) on the request of the company and
after receiving no objection certificate from the bank. The rating
action is in-line with CRISIL's policy on withdrawal of its rating
on bank loan facilities.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Cash Credit 4.5 CRISIL B+/Stable (ISSUER NOT
COOPERATING; Rating Withdrawn)
Term Loan 4.5 CRISIL B+/Stable (ISSUER NOT
COOPERATING; Rating Withdrawn)
CRISIL has been consistently following up with AKLC for obtaining
information through letters and emails dated April 30, 2019 and May
24, 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 AKLC. This restricts CRISIL's
ability to take a forward looking view on the credit quality of the
entity. CRISIL believes that the information available for AKLC 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, CRISIL
has Continues the ratings on the bank facilities of AKLC to 'CRISIL
B+/Stable Issuer not cooperating'.
CRISIL has withdrawn its rating on the bank facilities of AKLC on
the request of the company and after receiving no objection
certificate from the bank. The rating action is in-line with
CRISIL's policy on withdrawal of its rating on bank loan
facilities.
AKLC was set up as a proprietorship firm of Mr Syju Lekshman in
2012. The Kollam (Kerala)-based firm manufactures M Sand.
ANKUR CLOTHING: CARE Assigns 'B' Rating to INR2.0cr LT Loan
-----------------------------------------------------------
CARE Ratings has assigned rating to the bank facilities of Ankur
Clothing Private Limited (ACPL), as:
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long Term Bank
Facilities 2.00 CARE B; Stable Assigned
Short Term Bank
Facilities 6.00 CARE A4 Assigned
Detailed Rationale & Key Rating Drivers
The ratings assigned to the bank facilities of ACPL are constrained
on account of weak financial risk profile marked by moderate scale
of operations with thin profitability margins, highly leveraged
capital structure and weak debt coverage indicators, susceptibility
of its profitability to volatile traded goods prices and ACPL's
presence in competitive, fragmented and cyclical industry. The
ratings also remain constrained due to ACPL's stretched liquidity
marked by low cash accruals and higher reliance on external
borrowings resulting into instances of devolvement of Letter of
Credit.
The ratings, however, derive strength from ACPL's experienced and
resourceful promoters in the textile industry.
Key Rating Sensitivities
Positive Factors
* Significant increase in scale of operations marked by total
operating income more than INR300 crore with sustained PBILDT
margin in range of 3%-5%
* Improvement in overall gearing below 3.00x on a sustained basis
with reduced reliance on external borrowings for funding working
capital requirements
Negative Factors
* Elongation in gross working capital cycle days beyond 200 days
Detailed description of key rating drivers
Key Rating Weaknesses
Moderate and decline scale of operations with thin profitability
margins
Over a span of 2 years from commencement of operations, the scale
of operations of ACPL stood moderate marked by total operating
income (TOI) of INR147.00 crore during FY19 (A; refers to the
period from April 1 to March 31), which declined from INR204.15
crore in FY18. The scale of operations of the company declined in
FY19 vis-à-vis FY18 mainly due to low trading activity of the
company during FY19 on the back of low demand for its products.
Further, the profitability margins of the company remained thin
with PBILDT (operating) margin and PAT margin of 0.71% and 0.11%
respectively in FY19 (P.Y.: 0.27% and 0.10%) owing to its trading
nature of business, low bargaining power with suppliers and intense
competition in the industry. Moreover, the gross cash accruals of
the company also remained low and stood at INR0.21 crore during
FY19.
Highly leveraged capital structure and weak debt coverage
indicators
The capital structure of ACPL is highly leveraged due to very small
net worth base of the company which stood at INR1.98 crore as on
March 31, 2019 and its working capital intensive nature of
operations. Due to this, overall gearing of ACPL remained high at
4.84x as on March 31, 2019 (P.Y.: 4.52x). Further, the debt
coverage indicators of ACPL also stood weak marked by Total
Debt/GCA of 45.01 years (P.Y.: 33.12 years) and PBILDT Interest
Coverage of 1.40x (P.Y.: 2.65x) during FY19.
Susceptibility of profitability to volatile commodity prices
The denim fabric account for majority of ACPL's trading activity.
The Indian denim industry is cyclical in nature and has witnessed
slowdown twice over past two decades mainly on back of piling up of
excess capacity with denim fabric manufacturers. Indian denim
fabric manufacturing sector has more than 11.5 billion meter per
year capacity with around 70—75% utilization. Due to continuous
capacity addition, the industry is witnessing an oversupply
situation leading to high competition and pricing pressure with
together impacts the profitability of the industry players.
Presence in competitive, fragmented and cyclical industry
ACPL operates in a highly fragmented and unorganized market of
textile industry with presence of large number of organized and
unorganized players. Also, lower entry barriers and low capital
requirements result in intense competition in the industry. Due to
this, there is stiff competition amongst the players leading to
lower bargaining power vis-à-vis the customers.
Key Rating Strengths
Experienced and resourceful promoters
ACPL is promoted by Mr. Santosh Baid along with other family
members. The directors of the company possess an experience of more
than a decade in the textile trading industry since they were
previously associated with various partnership firms engaged in
similar line of business namely – M/s. Ankur Exim, M/s. Ankur
Fab, M/s. Yash Fabrics and M/s. Ankur Trading Company. The
promoters of the company are actively involved in day to day
management of the company. They are well assisted by qualified
second-tier management in day to day operations. Further, long
experience of the promoters in the said industry helps them develop
a marketing network which benefits the company in terms of
procurement of goods and ease in managing day-to-day operations.
Liquidity: Stretched
The liquidity of the company is stretched marked by low cash
accruals, elongated debtor collection and high reliance on working
capital borrowings. The company keeps an inventory of around 1
month and further extends credit period of around 90-120 days to
its customers. The company largely funds its working capital
requirement through bank borrowings including high reliance on
non-fund based limits. The company procures traded goods from its
supplier largely against the letter of credit. Further, as informed
by ACPL's banker, the average utilization of fund based working
capital limits remained high at 85% for trailing twelve months
ending December 2019. Moreover, the banker have also informed that
there were instances of devolvement of letter of credit which
normally regularised within 4-5 days.
Incorporated in October 2016, ACPL is promoted and managed Mr
Santosh Baid along with other family members based out of
Ahmedabad. ACPL is engaged into trading of denim and suiting
fabric. The promoters of the company are having an experience of
around two decades in the textile trading industry. They were
previously associated with various partnership firms having similar
business operations.
ARG DEVELOPERS: CARE Lowers Rating on INR49.37cr Loan to 'D'
------------------------------------------------------------
CARE Ratings revised the ratings on certain bank facilities of ARG
Developers Private Limited (ADPL), as:
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long term Bank 49.37 CARE D; Issuer Not Cooperating;
Facilities Revised from CARE C; Stable;
ISSUER NOT COOPERATING; On the
basis of best available
information
Detailed Rationale & Key Rating Drivers
CARE had, vide its press release dated October 3, 2018, continued
to classify the rating of ADPL under the 'issuer non-cooperating'
category as ADPL had failed to provide information for monitoring
of the rating. ADPL continues to be non-cooperative despite
repeated requests for submission of information through e-mails,
phone calls and a letter dated December 6, 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.
The rating has been revised on account of on-going delays in debt
servicing by the company.
Detailed description of the key rating drivers
Key Rating Weaknesses
Delays in debt servicing: As confirmed by the banker, there are
ongoing delays in debt servicing by the company and account has
been classified as Non-performing Asset (NPA).
ARG Developers Private Limited (ADPL) was initially incorporated in
2007 with the name of ARG Developer Private Limited. Later on, in
the year 2008, the name of the company was converted and assumed
its current name ADPL. ADPL is a flagship company of ARG Group,
incorporated with the objective to work on the real estate
projects. The company has executed some projects which include 3
residential and 3 commercial projects at Jaipur and Gwalior. At
present, ADPL is working on ultra-luxury residential project 'ARG
ONE' with total saleable area of around 2.54 lakh square feet (lsf)
having 62 flats.
ASHOK SALES: CRISIL Migrates 'B' Rating to Not Cooperating
----------------------------------------------------------
CRISIL has migrated the rating on bank facilities of Ashok Sales
Agency (ASA) to 'CRISIL B/Stable Issuer not cooperating'.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Cash Credit 6.5 CRISIL B/Stable (ISSUER NOT
COOPERATING; Rating Migrated)
CRISIL has been consistently following up with ASA for obtaining
information through letters and emails dated November 30, 2019,
February 3, 2020 and February 7, 2020 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 ASA, which restricts CRISIL's
ability to take a forward looking view on the entity's credit
quality. CRISIL believes information available on ASA is consistent
with 'Scenario 1' outlined in the 'Framework for Assessing
Consistency of Information with CRISIL BB' rating category or
lower'.
Therefore, on account of inadequate information and lack of
management cooperation, CRISIL has migrated the rating on bank
facilities of ASA to 'CRISIL B/Stable Issuer not cooperating'.
Ashok Sales Agency set up in the year 1980 as a proprietorship firm
is engaged in the distributorship of Fertilizer, seeds and
pesticides. It is promoted by Mr. Ashok Kumar Saha who looks after
the day to day operation.
AVANTIS DREAM: CRISIL Migrates 'B+' Rating to Not Cooperating
-------------------------------------------------------------
CRISIL has migrated the rating on bank facilities of Avantis Dream
Homes LLP (ADH) to 'CRISIL B+/Stable Issuer not cooperating'.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Term Loan 63 CRISIL B+/Stable (ISSUER NOT
COOPERATING; Rating Migrated)
CRISIL has been consistently following up with ADH for obtaining
information through letters and emails dated November 30, 2019 and
December 26, 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 ADH, which restricts CRISIL's
ability to take a forward looking view on the entity's credit
quality. CRISIL believes information available on ADH is consistent
with 'Scenario 1' outlined in the 'Framework for Assessing
Consistency of Information with CRISIL BB' rating category or
lower'.
Therefore, on account of inadequate information and lack of
management cooperation, CRISIL has migrated the rating on bank
facilities of ADH to 'CRISIL B+/Stable Issuer not cooperating'.
ADH is a partnership firm engaged in the development of high end
residential real estate. The firm is mainly present in Surat,
Gujarat. ADH is promoted and is currently being run by Shankar Shah
and his sons Ankit Shah and Viral Shah.
B.N. INDUSTRIES: Ind-Ra Raises Long Term Issuer Rating to 'B+'
--------------------------------------------------------------
India Ratings and Research (Ind-Ra) has upgraded B.N. Industries'
(BNI) Long-Term Issuer Rating to 'IND B+' from 'IND B'. The Outlook
is Stable.
The instrument-wise rating actions are:
-- INR65 mil. Fund-based limits Long-term rating upgraded; Short-
term rating affirmed with IND B+/Stable/IND A4 rating; and
-- INR 30 mil. Non-fund based affirmed with IND A4 rating.
KEY RATING DRIVERS
The upgrade reflects growth in the company's scale of operation to
medium from small. Its revenue increased to INR278.10 million in
FY19 (FY18: INR213.40 million) due to an increase in demand.
The ratings reflect BNI's modest EBITDA margins due to intense
competition in the industry. The margins contracted to 8.85% in
FY19 (FY18: 9.78%) due to an increase in raw material costs. The
company's return on capital employed was 10.7% in FY19 (FY18:
13.2%).
The ratings also factor in BNI's moderate credit metrics. Its gross
interest coverage (operating EBITDA/gross interest expense)
marginally improved to 1.51x in FY19 (FY18: 1.44x) due to an
improvement in the absolute EBITDA to INR24.60 million (INR20.86
million). Its net financial leverage (total adjusted net
debt/operating EBITDAR), too, improved to 5.17x in FY19 (FY18:
6.27x).
Liquidity Indicator – Stretched: BNI's average use of the
fund-based facility was 98.99% for the 12-months ended in January
2020. The company had liquid cash and cash equivalents of INR0.81
million at end-FY19 (end-FY18: INR1.03 million) against total debt
of INR128.03 million (INR131.78 million). The cash flow from
operations turned positive to INR14.48 million in FY19 (FY18:
negative INR7.94 million) due to favorable changes in the working
capital.
The ratings, however, remain supported by the promoters' over 27
years of experience in the industrial chemical manufacturing
business.
COMPANY PROFILE
Incorporated in 1989, BNI is a partnership firm engaged in the
manufacturing of non-ferrous metals at its Daman facility. The firm
is promoted by Ashwani Kumar Singhal and Akhilesh Singhal.
BILPOWER LIMITED: CRISIL Keeps 'D' Rating in Not Cooperating
------------------------------------------------------------
CRISIL said the ratings on the bank facilities of Bilpower Limited
(Bilpower) continues to be at 'CRISIL D/CRISIL D Issuer Not
Cooperating'.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Cash Credit 90 CRISIL D (ISSUER NOT
COOPERATING)
Letter of credit 80 CRISIL D (ISSUER NOT
& Bank Guarantee COOPERATING)
Proposed Long Term 4 CRISIL D (ISSUER NOT
Bank Loan Facility COOPERATING)
CRISIL has been consistently following up with Bilpower for
obtaining information through a letter and email dated July 31,
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 the strategic intent of
Bilpower. This restricts CRISIL's ability to take a forward-looking
view on the credit quality of the entity. CRISIL believes that the
information available for Bilpower is consistent with 'Scenario 2'
outlined in the 'Framework for Assessing Consistency of Information
with CRISIL BBB' rating category or lower.
Based on the last available information, the ratings continues to
be at 'CRISIL D/CRISIL D Issuer Not Cooperating'.
Key Rating Drivers & Detailed Description
* Delay in servicing debt: Bilpower has delayed the servicing of
debt, due to weak liquidity, resulting from operating losses.
* Weak financial risk profile
Networth was negative, driven by continued operating losses, and
sizeable short-term debt.
Bilpower, incorporated in 1989, manufactures transformer
laminations. It has manufacturing units at Vadodara (Gujarat),
Silvassa (Dadra and Nagar Haveli), Kanchad (Maharashtra), and
Roorkee (Uttarakhand).
BLISSFUL GARMENTS: CRISIL Migrates 'D' Rating to Not Cooperating
----------------------------------------------------------------
CRISIL has migrated the rating on bank facilities of Blissful
Garments Private Limited (BGPL) to 'CRISIL D Issuer not
cooperating'.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Cash Credit 3.5 CRISIL D (ISSUER NOT
COOPERATING; Rating Migrated)
Long Term Loan 6.5 CRISIL D (ISSUER NOT
COOPERATING; Rating Migrated)
CRISIL has been consistently following up with BGPL for obtaining
information through letters and emails dated February 3, 2020 and
February 7, 2020 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 BGPL, which restricts CRISIL's
ability to take a forward looking view on the entity's credit
quality. CRISIL believes information available on BGPL is
consistent with 'Scenario 1' outlined in the 'Framework for
Assessing Consistency of Information with CRISIL BB' rating
category or lower'.
Therefore, on account of inadequate information and lack of
management cooperation, CRISIL has migrated the rating on bank
facilities of BGPL to 'CRISIL D Issuer not cooperating'.
Incorporated in 2016, BGPL is involved in manufacturing of
readymade garments and has its manufacturing capacity in Palakkad,
Kerala. The day-to-day operations are looked after by Mr.
Sankaranarayan.
CALCUTTA ELECTRODES: Ind-Ra Withdraws BB-, NonCooperating Rating
----------------------------------------------------------------
India Ratings and Research (Ind-Ra) has maintained Calcutta
Electrodes Private Limited's (CEPL) Long-Term Issuer Rating of 'IND
BB- (ISSUER NOT COOPERATING)' in the non-cooperating category and
has simultaneously withdrawn it.
The instrument-wise rating action is:
-- INR 70 mil. Fund-based working capital limit* maintained in
non-cooperating and withdrawn;
*Maintained in 'IND BB- (ISSUER NOT COOPERATING)' before
withdrawn.
KEY RATING DRIVERS
The ratings have been maintained in the non-cooperating category
because the issuer did not participate in the rating exercise
despite continuous requests and follow-ups by Ind-Ra.
Ind-Ra is no longer required to maintain the ratings, as it has
received a no-objection certificate from the lender. This is
consistent with the Securities and Exchange Board of India's
circular dated March 31, 2017, for credit rating agencies.
COMPANY PROFILE
Incorporated in September 1992, Calcutta Electrodes manufactures
arc welding electrodes and carbon dioxide metal inert gas welding
wires at its manufacturing unit in Bhanpuri, Raipur.
EMERALD MINERAL: Insolvency Resolution Process Case Summary
-----------------------------------------------------------
Debtor: Emerald Mineral Exim Private Limited
Mastan Road, P.O. Buxi Bazar
Cuttack, Orissa 753001
India
Insolvency Commencement Date: February 20, 2020
Court: National Company Law Tribunal, Kolkata Bench
Estimated date of closure of
insolvency resolution process: August 18, 2020
(180 days from commencement)
Insolvency professional: Pratim Bayal
Interim Resolution
Professional: Pratim Bayal
18/1 Tarapukur Main Road
Ghosh Para, Agarpara
Kolkata, West Bengal 700109
E-mail: pratimbayal@gmail.com
- and -
CK-104, Salt Lake City
Sector-2, Kolkata 700091
E-mail: cirp.emeraldmineral20@gmail.com
Last date for
submission of claims: March 7, 2020
G.R. ENGINEERING: Ind-Ra Affirms BB+ LT Issuer Rating, Outlook Pos.
-------------------------------------------------------------------
India Ratings and Research (Ind-Ra) has revised G. R. Engineering
Private Limited's (GRPL) Outlook to Positive from Stable while
affirming its Long-Term Issuer Rating at 'IND BB+'.
The instrument-wise rating actions are:
-- INR376.2 mil. Fund-based working capital facilities affirmed;
Outlook revised to Positive from Stable with IND BB+ /
Positive/IND A4+ rating;
-- INR2.850 bil. Non-fund-based working capital facilities
affirmed with IND A4+ rating;
-- INR223.8 mil. Proposed fund-based working capital facilities*
affirmed; Outlook revised to Positive from Stable with
Provisional IND BB+/Positive/ Provisional IND A4+ rating; and
-- INR550 mil. Proposed non-fund-based working capital
facilities* affirmed with Provisional IND A4+ rating.
* The ratings are provisional and shall be confirmed upon the
sanction and execution of loan documents for the above facility by
GRPL to the satisfaction of Ind-Ra.
The Outlook revision reflects Ind-Ra's expectation that GRPL's
revenue will increase over FY20-FY21 on the back of its healthy
order book, which provides revenue visibility for the medium term.
KEY RATING DRIVERS
GRPL's revenue rose by 57.8% YoY to INR1,736 million in FY19 owing
to increased execution of orders. However, the scale of operation
continued to be medium. The company's growth is linked to capital
spending by end-users from the petrochemicals, fertilizers, and
refineries sectors. Any fall in capital spending by the end-users
would have a direct impact on GRPL's operating performance. GRPL
recorded revenue of INR2,125.45 million in 9MFY20. As of December
31, 2019, GRPL had an order book of INR4079 million (more than 2x
of FY19 revenue), the majority of which will be executed in FY21.
In addition, GRPL expects to receive orders worth INR11,421 million
until the end of July 2020.
The ratings reflect the moderate credit metrics due to high debt
levels. The metrics improved in FY19 due to an increase in the
absolute EBITDA to INR193 million (FY18: INR50 million). GRPL's
interest coverage (operating EBITDA/gross interest expense) stood
at 2.2x in FY19 (FY18: 0.6x) and the net leverage (total adjusted
net debt/operating EBITDAR) was 7.9x (30.6x). Out of the total debt
of INR1525 million in FY19, the interest-free unsecured loans stood
at INR807 million; of this, INR300 million was subordinated debt,
for which GRPL has passed a board resolution stating that it will
remain in the business. Excluding interest-free unsecured loans
from shareholders (FY19: INR807.3 million, FY18: INR755.8 million),
the net leverage was 3.7x in FY19 (FY18: 15.5x). Ind-Ra expects the
credit metrics to remain under pressure in the near term because of
an increase in the total debt, due to increase in the fund-based
limits, and the management's debt-led CAPEX plans for establishing
a new plant at Dahej (Gujarat) at a cost of INR500 million (to be
funded by approximately 25% own funds and 75% term loan), which is
likely to be executed in FY21 and FY22.
The ratings reflect GRPL's modest EBITDA margins due to the intense
competition in the industry. The margin rose to 11.1% in FY19
(FY18: 4.6%) owing to a fall in indirect expenses and an increase
in the revenue. The ROCE was 4.3% in FY19 (FY18: negative ROCE).
Ind-Ra expects the EBITDA margin to grow over the near-to-medium
term due to the execution of orders in hand as well as newly
awarded orders, assuming there are no cost and time overruns.
The ratings also factor in GRPL's high customer concentration risk,
with the top three reputed customers accounting for 87% of its
total revenue in FY19 (FY18: 79%). Ind-Ra expects the risk to
remain high in the long term, taking into account the nature of the
orders in hand, the upcoming projects and the nature of business.
Liquidity Indicator- Adequate: GRPL's average maximum utilization
of the fund-based and non-fund-based facility was 49.3% and 82.1%,
respectively, during the 12 months ended November 2019. The
company's net cash conversion cycle improved to 111 days in FY19
(FY18: 360 days) due to a decline in debtor days (FY19: 169 days;
FY18: 335 days) and an increase in creditor days (FY19: 276 days;
FY18: 111 days). The receivables include pending payments from
projects executed by GRPL in the past. The creditor days increased
due to a rise in the trade payables to INR554.17 million (FY18:
INR72.67 million) and an increase in advances from customers to
INR613.31 million (FY18: INR245.55 million). Ind-Ra expects the
net cash conversion cycle to remain elongated in the long term on
account of high debtor days and high inventory days, as the
inventory turnaround time ranges from 12 months to 36 months,
depending on individual projects, inherent to the industry. The
cash and cash equivalent remained low at INR8 million in FY19
(FY18: INR54 million). The cash flow from operations rose to INR143
million (FY18: INR27 million) due to the increase in the absolute
EBITDA. The free cash flow declined to INR13 million in FY19 (FY18:
INR25 million).
However, the liquidity position is supported by mobilization
advances of 5% - 10% from newly awarded contracts and interest-free
unsecured loans provided by the promoters of the company. Moreover,
the company has unused fund-based limits of around INR211 million
from banks.
The ratings continue to be supported by GRPL's promoters'
experience of over four decades in the fabrication business, which
has led to longstanding relationships with its key customers such
as Hindustan Petroleum Corporation Limited ('IND AAA'/Stable),
Indian Oil Corporation Ltd ('IND AAA'/Stable), Bharat Petroleum
Corporation Limited and Oil and Natural Gas Corporation, among
others, ensuring steady order inflow.
RATING SENSITIVITIES
Negative: Any delay in the execution of the order book, leading to
a decline in the EBITDA or EBITDA margins, which could result in a
delay in the expected improvement in the interest coverage to over
2.5x, would result in the Outlook being revised back to Stable.
Positive: Timely execution of the orders in hand, leading to an
improvement in the EBITDA or EBITDA margin, resulting in an
improvement in the interest coverage above 2.5x, along with an
improvement in overall liquidity, would result in a positive rating
action.
COMPANY PROFILE
Incorporated in 1966 by Mr. D.P. Hariani, Mumbai-based GRPL
supplies fabricated equipment for gas or liquid storage facilities
on an engineering, procurement and construction basis. Its
production unit is based in Tarapur.
IL&FS LTD: HSBC Files Winding Up Plea Against Unit
--------------------------------------------------
Livemint.com reports that the Hongkong and Shanghai Banking Corp.
(HSBC) Ltd has moved a winding-up petition against a subsidiary of
IL&FS Transport Services Ltd (ITNL) in a Singapore court to recover
dues of INR1,060 crore, information from the Singapore government
gazette showed.
HSBC is seeking to recover its investment in ITNL Offshore Pte.
Ltd's bonds maturing in 2021, this is the first such case against
the firm filed by an overseas lender, the report says. The case
will be heard on March 20.
Livemint.com relates that ITNL, a part of the Infrastructure
Leasing and Financial Services Ltd (IL&FS), owes INR40,000 crore to
lenders. The group-level debt stands at INR1 trillion. The Centre,
through the ministry of corporate affairs (MCA), had taken over the
management of the group in October 2018. Following the move, Indian
lenders did not initiate insolvency proceedings against any IL&FS
group company.
According to the report, the government has time to intervene in
the proceedings to ensure the rights of the Indian lenders are not
compromised due to the winding-up petition.
The problems for ITNL are likely to compound as a forensic report
has found suspected money laundering of INR6,500 crore by the
former management of its parent company, Mint notes.
The report found that in 14 special purpose vehicles (SPVs), there
were deliberate cost overruns through some shell structures, said
an official from an enforcement agency, requesting anonymity, Mint
relays.
On March 4, the National Company Law Appellate Tribunal also
dismissed a plea filed by the auditors of IL&FS Financial Services
(IFIN) Deloitte Haskin and Sells (Deloitte India) and BSR Co (KPMG
affiliate) against the five-year ban imposed by the MCA, Mint
reports.
About IL&FS
Infrastructure Leasing & Financial Services Limited (IL&FS) --
https://www.ilfsindia.com/ -- is an infrastructure development and
finance company based in India. It focuses on the development and
commercialization of infrastructure projects, and creation of value
added financial services. The company operates in Financial
Services, Infrastructure Services, and Others segments.
As reported in the Troubled Company Reporter-Asia Pacific on Oct.
3, 2018, the Indian Express said that the Indian government on Oct.
1, 2018, stepped in to take control of crisis-ridden IL&FS by
moving the National Company Law Tribunal (NCLT) to supersede and
reconstitute the board of the firm which has defaulted on a series
of its debt payments. This was said to be an attempt to restore the
confidence of financial markets in the credibility and solvency of
the infrastructure financing and development group.
INDEPENDENT TV: Insolvency Resolution Process Case Summary
----------------------------------------------------------
Debtor: M/s Independent TV Limited
H Block, 1st Floor Dhirubhai Ambani Knowledge City
Navi Mumbai MH 400710
Insolvency Commencement Date: February 26, 2020
Court: National Company Law Tribunal, Mumbai Bench
Estimated date of closure of
insolvency resolution process: August 24, 2020
Insolvency professional: Anup Kumar
Interim Resolution
Professional: Anup Kumar
734, Lawyers Chamber Block
Western Wing, Tis Hazari Court
Delhi 110054
E-mail: sachanlawanalyst@gmail.com
- and -
C/o M/s Synergy Insolvency Professionals
LLP (IPE)
906, I-thum Business Park
Sector-62, Noida
UP 201301
E-mail: cirp.independentTV@synergyipc.com
Last date for
submission of claims: March 14, 2020
INDIAN MINING: Insolvency Resolution Process Case Summary
---------------------------------------------------------
Debtor: Indian Mining Works Private Limited
234/3A, A.J.C. Bose Road
FMC Fortuna, Unit A7 3rd Floor
Kolkata WB 700020
Insolvency Commencement Date: February 28, 2020
Court: National Company Law Tribunal, Kolkata Bench
Estimated date of closure of
insolvency resolution process: August 26, 2020
Insolvency professional: Mr. Sandip Kumar Kejriwal
Interim Resolution
Professional: Mr. Sandip Kumar Kejriwal
322, 3rd Floor, Martin Burn House
1, R.N. Mukherjee Road
Kolkata 700001
E-mail: sandipkej2@gmail.com
Last date for
submission of claims: March 13, 2020
JAIN STUDIOS: Insolvency Resolution Process Case Summary
--------------------------------------------------------
Debtor: Jain Studios Limited
Scindia Villasarojini Nagar
Ring Road New Delhi
DL 110023
IN
Insolvency Commencement Date: February 26, 2020
Court: National Company Law Tribunal, Meerut Bench
Estimated date of closure of
insolvency resolution process: August 24, 2020
Insolvency professional: Manish Agarwal
Interim Resolution
Professional: Manish Agarwal
707, Saket
Opp. Rohtash Sweets
Meerut 250001
Uttar Pradesh
E-mail: manishfcs@gmail.com
- and -
205, 2nd Floor, Rohit House
Tower-2, Tolstoy Marg
Connaught Place
New Delhi 01
E-mail: cirp.jainstudios@gmail.com
Last date for
submission of claims: March 11, 2020
KALYAN COTTON: CRISIL Migrates B+ Rating to Not Cooperating
-----------------------------------------------------------
CRISIL has migrated the rating on bank facilities of Kalyan Cotton
Industries (KCI) to 'CRISIL B+/Stable Issuer not cooperating'.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Cash Credit 4.75 CRISIL B+/Stable (ISSUER NOT
COOPERATING; Rating Migrated)
Long Term Loan 1.25 CRISIL B+/Stable (ISSUER NOT
COOPERATING; Rating Migrated)
CRISIL has been consistently following up with KCI for obtaining
information through letters and emails dated November 30, 2019 and
December 26, 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 KCI, which restricts CRISIL's
ability to take a forward looking view on the entity's credit
quality. CRISIL believes information available on KCI is consistent
with 'Scenario 1' outlined in the 'Framework for Assessing
Consistency of Information with CRISIL BB' rating category or
lower'.
Therefore, on account of inadequate information and lack of
management cooperation, CRISIL has migrated the rating on bank
facilities of KCI to 'CRISIL B+/Stable Issuer not cooperating'.
Established in 2013 in Rajkot by Mr Chandrakant Bhimani and Family,
KCI manufactures cotton bales, cotton seed oil, cotton de-oiled
cake from Raw cotton.
KALYANIKA PROMOTORS: CRISIL Withdraws D Rating on INR10cr Loan
--------------------------------------------------------------
CRISIL has withdrawn its rating on the bank facilities of Shri
Kalyanika Promotors and Developers Private Limited (SSBJDHIPL) on
the request of the company and after receiving no objection
certificate from the bank. The rating action is in-line with
CRISIL's policy on withdrawal of its rating on bank loan
facilities.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Term Loan 10 CRISIL D (ISSUER NOT
COOPERATING; Rating Withdrawn)
CRISIL has been consistently following up with SSBJDHIPL 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 SSBJDHIPL. This restricts
CRISIL's ability to take a forward looking view on the credit
quality of the entity. CRISIL believes that the information
available for SSBJDHIPL 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, CRISIL has Continues the ratings on the bank
facilities of SSBJDHIPL to 'CRISIL D Issuer not cooperating'.
CRISIL has withdrawn its rating on the bank facilities of SSBJDHIPL
on the request of the company and after receiving no objection
certificate from the bank. The rating action is in-line with
CRISIL's policy on withdrawal of its rating on bank loan
facilities.
Furthermore, the company has not paid the fee for conducting rating
surveillance as agreed to in the rating agreement.
SSBJDHIPL was set up in 2012-13 (refers to financial year, April 1
to March 31) by Mr. Anand Haldiwal, Mr. Omprakash Haldiwal, Mrs.
Rakhi Haldiwal, Dr. Jagdish Chand Yadav, Dr. Manoj Gurjar, and Dr.
Vishal Yadav. The company runs a hospital in Barwani (Madhya
Pradesh). It started operations in July 2014.
KUNJ ROLLER: Ind-Ra Affirms 'BB+' LT Issuer Rating, Outlook Stable
------------------------------------------------------------------
India Ratings and Research (Ind-Ra) has affirmed Kunj Roller Flour
Mills Pvt. Ltd's (KRFM) Long-Term Issuer Rating at 'IND BB+'. The
Outlook is Stable.
The instrument-wise rating actions are:
-- INR180 mil. (increased from INR160 mil.) Fund-based limits
affirmed with IND BB+/Stable rating; and
-- INR17.40 mil. Term loan due on September 2022 assigned with
IND BB+/Stable rating.
KEY RATING DRIVERS
The affirmation reflects KRFM's continued medium scale of
operations, as indicated by revenue of INR,1210.97 million in FY19
(FY18: INR1,095.19 million). The revenue increased due to growth in
orders and would have been higher if not for the impact of the
Cyclone Fani, which affected the state of Odisha in May 2019. The
company booked revenue of INR923.3 million in 9MFY20.
The ratings reflect the modest EBITDA margins due to intense
competition in the market. The margin rose to 2.55% in FY19 (FY18:
2.38%) owing to a fall in raw material prices. The ROCE was 8.1% in
FY19 (FY18: 7.8%),
The rating factor in the moderate credit metrics due to high debt
levels. Despite an increase in the overall debt to INR207.74
million in FY19 (FY18: INR189.82 million), the net leverage
(adjusted net debt/operating EBITDAR) improved to 6.7x ( 7.3x) due
to a rise in the absolute EBITDA to INR30.85 million (INR26.02
million). The gross interest coverage (operating EBITDA/gross
interest expense) remained stable at 1.7x in FY19 (FY18: 1.7x)
because of a proportionate increase in interest expenses. The
credit metrics, however, are likely to deteriorate in FY20 due to
the undertaking of a short-term working capital facility of INR20
million and an additional term loan to pay off unsecured debt.
Liquidity Indicator - Poor: KRFM's average utilization of the
working capital limits was 96.7% (FY18:94.8%) during the 12 months
ended in January 2020. The company's networking capital cycle
remained comfortable at 66 days in FY19 (FY18: 63 days, FY17: 53
days). The cash flow from operations remained negative in FY19 due
to unfavorable changes in the working capital requirements but
improved to a negative INR17 million (FY18: negative INR33.38
million, FY17: negative INR40.05 million) due to the increase in
the absolute EBITDA. At FYE19, it had cash and cash equivalents of
INR2.14 million.
The ratings, however, continue to be supported by the promoters'
experience of around three decades in the flour milling business.
RATING SENSITIVITIES
Positive: A substantial increase in the scale of operations, with
an improvement in the liquidity and an improvement in the gross
interest coverage to over 2.5x will be positive for the ratings.
Negative: Deterioration in the profitability and liquidity, leading
to deterioration in the gross interest coverage to below 1.5x, will
be negative for the ratings.
COMPANY PROFILE
Incorporated on May 7, 1997, KRFM operates a flour mill. The
company sells flour in the eastern part of India under the Rishta
Food brand. It began commercial production on April 1, 2000.
MAA VAISHNO: CRISIL Withdraws D Rating on INR5.0cr Loan
-------------------------------------------------------
CRISIL has withdrawn its rating on the bank facilities of Maa
Vaishno Devi Educational Trust (MVD) on the request of the company
and after receiving no objection certificate from the bank. The
rating action is in-line with CRISIL's policy on withdrawal of its
rating on bank loan facilities.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Drop Line 1.15 CRISIL D (ISSUER NOT COOPERATING;
Overdraft Migrated from 'CRISIL D'; Rating
Facility Withdrawn)
Overdraft 5.00 CRISIL D (ISSUER NOT COOPERATING;
Migrated from 'CRISIL D'; Rating
Withdrawn)
CRISIL has been consistently following up with MVD for obtaining
information through letters and emails dated February 5, 2020 and
February 10, 2020 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 MVD. This restricts CRISIL's
ability to take a forward looking view on the credit quality of the
entity. CRISIL believes that the information available for MVD 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, CRISIL
has migrated the ratings on the bank facilities of MVD to 'CRISIL
D/CRISIL D Issuer not cooperating'.
CRISIL has withdrawn its rating on the bank facilities of MVD on
the request of the company and after receiving no objection
certificate from the bank. The rating action is in-line with
CRISIL's policy on withdrawal of its rating on bank loan
facilities.
MVD is a Lucknow-based educational trust that runs two colleges.
Maa Vaishno Devi Law College provides courses for achieving a
graduate degree in law and Maa Vaishno Devi and Law College
provides courses for postgraduate management degrees in finance,
human resources, and marketing. Both the colleges are based in
Lucknow and are affiliated to Lucknow University.
MALVIKA TECHNICAL: CARE Cuts INR0.75cr Loan Rating to B+, Not Coop.
-------------------------------------------------------------------
CARE Ratings revised the ratings on certain bank facilities of
Malvika Technical Services (MTS), as:
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long term Bank 0.75 CARE B+; Stable; Issuer not
Facilities cooperating; Revised from
CARE BB-; Stable on the basis
of best available information
Short term Bank 7.60 CARE A4; Stable; Issuer not
Facilities cooperating; Based on the basis
of best available information
Detailed Rationale & Key Rating Drivers
MTS has not paid the surveillance fees for the rating exercise
agreed to in its Rating Agreement. In line with the extant SEBI
guidelines, CARE's rating on MTS's bank facilities will now be
denoted as CARE B+; Stable/A4; ISSUER NOT COOPERATING.
Users of this rating (including investors, lenders and the public
at large) are hence requested to exercise caution while using the
above rating(s).
The rating has been revised on account of modest scale of operation
and stretched liquidity position. The ratings are, further,
constrained on account of constitution as a proprietorship concern
and high competitive intensity in the government civil construction
segment.
The ratings, however, derive strength from the experienced
management, moderate profitability margins and moderate solvency
position.
Detailed description of the key rating drivers
At the time of last rating on February 11, 2019, the following were
the rating strengths and weaknesses.
Key Rating Weaknesses
Modest scale of operations
During FY19, Total Operating Income (TOI) of the firm has declined
by 16.82% over FY18 and stood modest at INR23.24 crore.
Furthermore, its constitution as a proprietorship concern leads to
limited financial flexibility and risk of withdrawal of capital.
Stretched liquidity position
The liquidity position of company stood stretched marked by average
collection period of 209 days in FY19. The current ratio and quick
ratio of firm stood moderate at 1.30 times and 1.06 times as on
March 31, 2019. Further, the operating cycle of the firm also stood
moderate at 26 days in FY19 although deteriorated from 19 days in
FY18 owing to increase in average collection period and average
creditor's period.
High competitive intensity in the government civil construction
segment
The construction industry is highly fragmented in nature with
presence of large number of unorganized players and a few large
organized players coupled with the tender driven nature of
construction contracts poses huge competition and puts pressure on
the profitability margins of the players. Further, as the firm
participates in tenders invited by government departments, high
competition and lower bargaining power restricts its profitability
margins.
Key Rating Strengths
Experienced and qualified management
Overall affairs of the firms are looked after by Mr. Jaideep
Dullar, husband of Mrs. Seema Dullar. He is B.tech by qualification
and has around three decades of experience in the industry. He is
assisted by his son, Mr. Tapesh Dullar, who is M.tech by
qualification.
Moderate profitability margin
The profitability margin of the company stood moderate marked by
PBILDT and PAT margin of 7.07% and 5.32% respectively in FY19 as
against 5.82% and 4.46% respectively in FY18.
Moderate Solvency position
The capital structure stood comfortable marked by overall gearing
of 0.98 times as on March 31, 2019 improved from 1.43 times as on
March 31, 2019 mainly due to increase in net worth base owing to
higher accretion of profit to reserves. Further, the debt coverage
indicators stood moderate marked by Total debt to GCA of 4.10 times
as on March 31, 2019 deteriorated from 3.97 times as on March 31,
2018 mainly due to increase in total debt and decline in GCA level.
Interest coverage stood comfortable at 5.54 times in FY19.
Jaipur (Rajasthan)-based Malvika Technical Services (MTS) was
established in 2010 by Mrs Seema Dullar. MTS is engaged in
providing infrastructure solutions such as finalization of road
levels with respect to rain water harvesting, water supply,
sewerage system as a whole and RWH in the field of civil
engineering. MTS has completed the design, construction and
erection of sewerage treatment plants (STP) of various capacities
across Rajasthan and Haryana, in towns such as Sikar, Bhiwadi,
Hanumangarh, Palrimeena, Chittorgarh, along with waste water
treatment plants (WWTP) and water supply systems at several
locations.
MANCHUKONDA AGROTECH: Ind-Ra Affirms BB+ LT Rating, Outlook Stable
------------------------------------------------------------------
India Ratings and Research (Ind-Ra) has affirmed Manchukonda
Agrotech Private Limited's (MAPL) Long-Term Issuer Rating at 'IND
BB+'. The Outlook is Stable.
The instrument-wise rating actions are:
-- INR211.9 mil. (reduced from INR288.8 mil.) Term loan due on
March 2022 affirmed with IND BB+/Stable rating; and
-- INR400 mil. Fund-based limits affirmed with IND BB+/Stable/IND
A4+ rating.
KEY RATING DRIVERS
The affirmation reflects MAPL's medium scale of operations, as
indicated by revenue of INR2,139 million in FY19 (FY18: INR1,340
million). The revenue increased owing to growth in sales volumes,
improvement in capacity utilization and better marketing measures
adopted by the management. The company's mill has the capacity to
process 48 tons per hour of rice. The capacity utilization improved
to around 70% in FY19 (FY18: 50%), and further to around 80% in
FY20. MAPL also has a co-gen plant for 5MW; post the captive
consumption, which is included as a part of the revenue from
operations, 65%-70% of the electricity generated is sold to the
Karnataka electricity board. The company achieved revenue of
INR2,244.64 million during 9MFY20.
The ratings reflect the modest EBITDA margins owing to the
commoditized nature of the products. The margin declined to 6.9% in
FY19 (FY18: 11.5%), mainly on account of fluctuations in the prices
of inputs (paddy and rice). The cost of paddy accounts for 85%-90%
of the company's cost of producing rice. MAPL's operating
profitability will remain susceptible to volatility in raw material
prices, which essentially depends on the total agricultural output.
The government regulations pertaining to minimum support price and
procurement policies also impact raw material availability. With
rice being a commodity, the market does not have much scope for
premium pricing, and thus, most manufacturers are price takers in
the markets that they operate in. The return on capital employed
stood at 8.5% in FY19 (FY18: 8.0%).
Liquidity indicator - Stretched: The average maximum utilization
of the fund-based limits was 60.7% during the 12 months ended in
January 2020. MAPL's utilization is generally at its peak after the
crop season and is minimal during the offseason, as the company has
to store rice and paddy after the crop season, which involves
blockage of working capital. Its cash flow operations increased to
INR35 million in FY19 (FY18: INR18 million) due to better working
capital management.
The net cash conversion cycle improved to 59 days in FY19 (FY18:
116 days), primarily on account of a reduction in inventory holding
period to 34 days (85 days), driven by timely execution of orders.
The company has total repayment obligations of INR77.73 million for
FY20 and FY21. MASF plans to undertake a CAPEX of INR110 million to
set up a 16TPH milling unit in 1HFY21, which is likely to be funded
in the ratio of 70-75:25-30 by debt and internal accruals. This
debt-funded CAPEX would exert further strain on the liquidity
position.
The ratings are also constrained by the moderate credit metrics due
to the modest EBITDA margins. The metrics improved in FY19 owing to
a decline in the total debt due to repayment of term loan and
reduction in the utilization of working capital limits, resulting
from the shortening of the working capital cycle. The interest
coverage (operating EBITDA/gross interest expenses) was 2.8x in
FY19 (FY18: 2.1x) and net leverage (adjusted net debt/operating
EBITDA) was 3.3x (3.9x).
The ratings are supported by the promoters' experience of over 30
years in the trading and processing of rice.
RATING SENSITIVITIES
Negativity: Any substantial time or cost overruns for completing
the CAPEX, any substantial decline in the revenue, volatility in
EBITDA margins, the stress in the liquidity position, resulting in
deterioration in the interest coverage falling below 2.7x, on a
sustained basis, could lead to a rating downgrade.
Positive: Successful completion of the CAPEX without any cost or
time overruns, a sustained improvement in the revenue, better price
risk management, stability in the EBITDA margins, along with an
improvement in the liquidity profile, while maintaining the credit
metrics, all on a sustained basis, could lead to a rating upgrade.
COMPANY PROFILE
MAPL was incorporated in 2009 in Miryalaguda, Telangana. The
company processes rice to produce raw rice, steam rice, and
parboiled rice. The company has an installed capacity of
48tonnes/hour. It has also installed a 5MW co-generation power
plant, mainly for captive consumption.
MANGALA ELECTRICALS: CARE Lowers Rating on INR3.34cr Loan to D
--------------------------------------------------------------
CARE Ratings revised the ratings on certain bank facilities of
Mangala Electricals (MA), as:
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long term Bank 3.34 CARE D Revised from CARE B+;
Facilities Stable
Short term Bank
Facilities 5.23 CARE D Revised from CARE A4
Detailed Rationale & Key Rating Drivers
The revision in the ratings of bank facilities of MA is tempered by
ongoing delays in servicing of interest due to weak liquidity
position.
Key Rating Sensitivity
Positive factors
* Delay free track record for minimum of 6 months
Negative factors: NA
Detailed description of the key rating drivers
Key Rating Weakness
Ongoing Delays in servicing debt obligations
There are on-going delays in repayment of term loan instalment and
interest repayments due to weak liquidity position. Further, the
banker has confirmed the same stating there are slight delays in
term loan repayment.
Small scale of operations along with fluctuating total operating
income during review period
The firm has a track record of more than three decades, however,
the total operating income (TOI), remained small at INR8.52 crore
in FY19 with low net worth base of INR2.17 crore as on March 31,
2019 as compared to other peers in the industry. The total
operating income of the firm has been fluctuating during review
period (FY16-FY18). The TOI of the firm increased from INR7.99
crore in FY18 to INR8.52 crore in FY19 due to increased and timely
execution of orders from MESCOM. During 10MFY20 (Provisional), the
firm has achieved total operating income of INR6.70 crore.
Short term revenue visibility in order book position with client
and geographically concentrated order book position
ME has an order book position of INR9.01 crore as on August 2020
and the same is likely to be completed by which reflects short term
revenue visibility. The current order book of the firm is
geographically and client concentrated from MESCOM (Mangalore
Electricity Supply Company Limited) under government of Karnataka.
Usually, the firm receives orders only from government and the firm
takes around 6-10 months for completing the work orders.
Elongated average collection days resulted in working capital
intensive nature of operations
The firm operates in working capital intensive nature of
operations. The operating cycle of the firm stood at 52 days in
FY19 as compared to 33 days in FY18 due to increase in the
inventory period during FY19. The Average Creditors days decreased
from 54 days in FY18 to 52 days in FY19 as the firm makes payment
to its supplier depending on the realization of payment from its
customers. The firm holds the average inventory of around 30-40
days to ensure timely execution of ongoing projects. Furthermore,
the firm has availed a credit period of 30-60 days from the
suppliers. The average utilization of working capital limit stood
full for the last 12 month ended January, 2020.
Highly fragmented industry with intense competition from other
players due to tender based nature of operations
The firm receives 100% work orders from government organizations.
All these are tender-based and the revenues are dependent on the
firm's ability to bid successfully for these tenders.
Profitability margins come under pressure because of competitive
nature of the industry. However, the partner's long industry
experience around two decade mitigates this risk to some extent.
Nevertheless, there are numerous fragmented & unorganized players
operating in the segment which makes the civil construction space
highly competitive.
Constitution of the entity as proprietorship firm with inherent
risk of withdrawal of capital
The proprietor typically makes all the decisions and led the
business operations. If he became ill or disable, there may not be
anybody else to step in and maintain the optimum functioning of
business. A business run by proprietor also poses a risk of heavy
burden, i.e. an inherent risk of capital withdrawal, at a time of
personal contingency which can adversely affect the capital
structure of the firm. Moreover, the proprietorship firms have
restricts access to external borrowing which limits their growth
opportunities to some extent. Also, the proprietor has withdrawn
INR0.17 crore during FY19.
Key Rating Strengths
Experienced proprietor with more than three decades in electrical
industry with established track record
Mangala Electricals (ME) was established in the year 1980 and has
been in the electrical industry for more than three decades. He is
a graduate and has more than three decades of experience in
electrical transmission work business. Due to long experience of
proprietor, he was able to establish long term relationship with
customers and suppliers.
Satisfactory profitability margins although fluctuating during
review period
The profitability margins of the firm are seen fluctuating,
however, remained satisfactory during the review period. The PBILDT
margin of the firm was fluctuating in the range of 11.44% to 16.50%
in (FY16-FY19) and stood at 16.49% in FY19 increasing from 15.24%
in FY18 due to decrease in material cost and sub contract work
expenses. Furthermore, due to aforementioned reason along with
decrease in interest expenses, the PAT margins of the firm also
remained fluctuating in the range of 6.00% to 5.55% during review
period and stood at 5.55% in FY19 improving from 4.37% in FY18 on
the back of Increase in PBILDT and decrease in interest expenses
during FY19.
Financial risk profile marked by satisfactory capital structure and
debt coverage indicators
The capital structure of the firm marked by debt equity ratio and
overall gearing remained satisfactory during review period. The
debt equity ratio of the firm has marginally declined from 0.24x as
on March 31st 2018 to 0.36x as on March 31st 2019 due to increase
in total debt on account of new term loans and vehicle loans
availed during FY19. However, The Average utilization of working
capital bank borrowings in FY19 stood at 90%. Furthermore, the
overall gearing ratio of the firm improved from 1.64 x as on March
31st 2018 to 1.42x as on March 31st 2019 on the back of increase in
net worth due to accretion of profits into business. The debt
coverage indicators remained satisfactory during review period.
Total debt/GCA improved from 5.76x in FY18 to 5.03x in FY19 due to
increase in gross cash accruals albeit increase in total debt.
However, Interest coverage ratio also improved from 2.19x in FY18
to 2.80x in FY19 due to increase in PBILDT absolute terms and
decrease in the interest cost during FY19.
Stable outlook of Indian electrical equipment industry
The Indian electrical equipment (EE) segment is one of the major
vertical of capital goods industry in the country which comprises
of heavy electrical and power plant equipments etc. The industry is
highly diverse and manufactures a wide range of high & low
technology products. EE occupies a large share in the total market
size of the capital goods in the country. The IEE industry can be
broadly classified into two sectors – generation equipments and
transmission & distribution equipments. The demand for electrical
equipment in India is expected to encounter significant expansion
vis-à-vis growth of the power sector. The IEE industry has shown
positive prospects of growth in past 5-6 years basis which it is
expected that it will meet the aggressive market expansion target
of USD 100 billion by the end of 2022.
Mangalore based, Mangala Electricals (ME) was established in the
year 1980 as proprietor firm promoted by Mr. Gajanthodi bhaskar
bhat. ME is engaged in the work of electrical infrastructure for
supply, erection, and installation of sub-station transmission
network, maintenances and distribution substations on turnkey basis
with single and double circuit lines, based on the requirement of
customers. The firm has installed various types of transformers
with capacity up to 11KV to 400KV. ME procures work orders through
government majorly from MESCOM (Mangalore Electricity Supply
Company Limited), KPTCL (Karnataka Power Transmission Corporation),
UPCL (Udupi), Chaitanya Home Industries and Shree Polali Temple.
The firm has current order book of INR7.35 crore to be completed by
August 2019.
MANIPUR TEA: CRISIL Upgrades Rating on INR4.8cr Loan to B-
----------------------------------------------------------
CRISIL has upgraded its rating on the long-term bank facilities of
Manipur Tea Co. Private Limited (Manipur Tea; part of the Mantri
group) to 'CRISIL B-/Stable' from 'CRISIL C'. The upgrade has been
driven by improved operating efficiency of the company because of
better operating profitability.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Cash Credit 4.8 CRISIL B-/Stable (Upgraded
from 'CRISIL C')
Proposed Cash 1.54 CRISIL B-/Stable (Upgraded
Credit Limit from 'CRISIL C')
CRISIL's rating reflects the group's exposure to seasonality of tea
production, high operating leverage, and weak financial risk
profile. These weaknesses are partially offset by the extensive
experience of the promoters in the tea industry.
Analytical Approach
For arriving at its rating, CRISIL has combined the business and
financial risk profiles of Manipur Tea, Mantri Tea Co. Pvt Ltd
(MTCPL), Derby Plantation Pvt Ltd (DPPL), and Ruttonpore
Plantations Pvt Ltd (RPPL) collectively referred to as the Mantri
group. This is because these entities have a common management, and
are in the same line of business, with operational and financial
linkages.
Unsecured loans have been treated as debt.
Key Rating Drivers & Detailed Description
Weakness:
* Exposure to seasonality of tea production and high operating
leverage
Being a seasonal product, the production of tea depends on the
monsoon and remains susceptible to adverse weather conditions. Tea
plantations also incur fixed cost, with labour alone accounting for
nearly 40% of total cost. If tea production is lower than expected,
then the group could incur operating losses, as seen in the past.
Limited pricing power further constrains the operating margin of
small players like the Mantri group.
* Weak financial risk profile
The weak financial risk profile is reflected in below-average debt
protection metrics. Interest coverage and net cash accrual to total
debt ratios were minus 1.29 times and minus 0.02 time,
respectively, for fiscal 2019. Gearing and networth were moderate
at 2.13 times and INR19.43 crore, respectively, as on March 31,
2019.
Strength:
* Extensive experience of the promoters in the tea industry
The promoters have an experience of five decades in the tea
plantation business, which has helped the group sustain its
position, despite regular volatility in prices, and report stable
revenue growth over the four fiscals through 2018.
Liquidity Stretched
* High bank limit utilisation:
Bank limit utilisation is high at 92.04% for the six months through
September 2019.
* Cash accrual insufficient to meet debt obligation
Cash accrual is expected to be over INR0.60 crore, which is
insufficient against term debt obligation of INR1.00 crore over the
medium term. The same is supported by unsecured loans from the
promoters.
* Low current ratio:
Current ratio was low at 0.62 time as on March 31, 2019.
* Support from the promoters in the form of equity infusion or
unsecured loans
The promoters are likely to extend support in the form of equity or
unsecured loans to meet the company's working capital requirement
and debt obligation.
Outlook: Stable
CRISIL believes that growth in revenue along with stable operating
margin will lead to healthy financial risk profile. The outlook may
be revised to 'Positive' if the firm reports significant revenue
growth and healthy operating margin, and improves its financial
risk profile. The outlook may be revised to 'Negative' in case of
lower-than-expected growth in revenue, drop in profitability, or
any large capital withdrawal, weakening the financial risk
profile.
Rating Sensitivity factors
Upward factors
* Sustained improvement in revenue by at least 10% and stable
operating margin, leading to higher cash accrual (in excess of debt
obligation)
* Improvement in working capital cycle, with debtors falling below
45 days
Downward factors
* Overdrawing of working capital limit for more than 30 days
* Single-day delay in repayment of term debt (either principal or
interest)
The Mantri group was formed in 1948 by Mr Govind Prasad Mantri. The
Manipur Tea Estate, located in Assam, was its first acquisition in
1954. Subsequently, the group acquired three more tea gardens in
Assam: Ruttonpore Tea Estate in 1986, Derby Tea Estate in 2005, and
Pathini Tea Estate (MTCPL) in 2006. Daily operations are now
overseen by the second and third-generation members of the promoter
family, along with a professional management team.
MELZER CHEMICALS: Ind-Ra Lowers Long Term Issuer Rating to 'BB+'
----------------------------------------------------------------
India Ratings and Research (Ind-Ra) has downgraded Melzer Chemicals
Private Limited's (MCPL) Long-Term Issuer Rating to 'IND BB+
(ISSUER NOT COOPERATING)' from 'IND BBB- (ISSUER NOT COOPERATING)'.
The issuer did not participate in the rating exercise despite
continuous requests and follow-ups by the agency. Thus, the rating
is based on the best available information. Therefore, investors
and other users are advised to take appropriate caution while using
these ratings. The rating will now appear as 'IND BB+ (ISSUER NOT
COOPERATING)' on the agency's website.
The instrument-wise rating actions are:
-- INR24.8 mil. Term loan due on March 2019 downgraded with IND
BB+ (ISSUER NOT COOPERATING) rating;
-- INR60 mil. Proposed term loan downgraded with Provisional IND
BB+ (ISSUER NOT COOPERATING) rating;
-- INR100 mil. Fund-based working capital limits downgraded with
IND BB+ (ISSUER NOT COOPERATING) rating;
-- INR20 mil. Proposed fund-based working capital limits
downgraded with Provisional IND BB+ (ISSUER NOT COOPERATING)
rating;
-- INR50 mil. Non-fund-based working capital limits downgraded
with IND A4+ (ISSUER NOT COOPERATING) rating; and
-- INR17.5 mil. Proposed non-fund-based working capital limits
downgraded with Provisional IND A4+ (ISSUER NOT COOPERATING)
rating.
Note: ISSUER NOT COOPERATING: Issuer did not cooperate; based on
the best-available information.
KEY RATING DRIVERS
The downgrade reflects a breach in Ind-Ra's negative rating
guideline of EBITDA margin deteriorating to 7.5% in FY18 (FY17:
9.7%) due to the increase in raw material price. The company's
return on capital employed stood at 11% in FY18 (FY17: 11%).
The ratings reflect the company's continued small operations.
Revenue increased to INR681 million in FY18 (FY17: INR484 million)
due to increased orders.
The ratings reflect MCPL's modest credit metrics. Its interest
coverage (operating EBITDA/gross interest expense) improved to 2.7x
in FY18 (FY17: 1.8x) and net leverage (adjusted net debt/operating
EBITDAR) to 3.1x (3.5x) due to an increase in absolute EBITDA to
INR51 million (INR47 million).
Liquidity Indicator- Stretched: MCPL's cash flow from operations
improved to INR21 million in FY18 (FY17: INR13 million). It had
cash and cash equivalents of INR22 million at FYE18 (FYE17: INR10
million).
The ratings have been migrated in the non-cooperating category as
MCPL has not shared information regarding bank limit utilization
details, no-dues certificates, and other necessary information
despite continuous requests and follow-ups.
RATING SENSITIVITIES
Positive: An increase in the revenue and profitability leading to
an improvement in the credit metrics will be positive for the
ratings.
Negative: The company's inability to improve the operating
profitability or a reduction in revenue, leading to further
stretched liquidity or deterioration in credit metrics, will be
negative for the ratings
COMPANY PROFILE
Incorporated in 1996, MCPL manufactures specialty chemicals,
polymers, and biocides.
NAGARJUNA HOSPITALS: CRISIL Moves 'B' Rating to Not Cooperating
---------------------------------------------------------------
CRISIL has migrated the rating on bank facilities of Nagarjuna
Hospitals Limited (NHL) to 'CRISIL B/Stable Issuer not
cooperating'.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Long Term Loan 13.2 CRISIL B/Stable (ISSUER NOT
COOPERATING; Rating Migrated)
Secured Overdraft 1.0 CRISIL B/Stable (ISSUER NOT
Facility COOPERATING; Rating Migrated)
CRISIL has been consistently following up with NHL for obtaining
information through letters and emails dated December 31, 2019,
February 3, 2020 and February 7, 2020 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 NHL, which restricts CRISIL's
ability to take a forward looking view on the entity's credit
quality. CRISIL believes information available on NHL is consistent
with 'Scenario 1' outlined in the 'Framework for Assessing
Consistency of Information with CRISIL BB' rating category or
lower'.
Therefore, on account of inadequate information and lack of
management cooperation, CRISIL has migrated the rating on bank
facilities of NHL to 'CRISIL B/Stable Issuer not cooperating'.
Incorporated in 1987, Vijayawada (AP) based NHL runs 2 hospitals.
NHL is promoted and managed by Dr. Kodali Jagan Mohan Rao.
NAGARSHETH SHIPBREAKERS: CRISIL Moves D Rating to Not Cooperating
-----------------------------------------------------------------
CRISIL has migrated the rating on bank facilities of Nagarsheth
Shipbreakers (NS) to 'CRISIL D Issuer not cooperating'.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Line of Credit 85 CRISIL D (ISSUER NOT
COOPERATING; Rating Migrated)
CRISIL has been consistently following up with NS for obtaining
information through letters and emails dated November 30, 2019 and
December 26, 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 NS, which restricts CRISIL's
ability to take a forward looking view on the entity's credit
quality. CRISIL believes information available on NS is consistent
with 'Scenario 1' outlined in the 'Framework for Assessing
Consistency of Information with CRISIL BB' rating category or
lower'.
Therefore, on account of inadequate information and lack of
management cooperation, CRISIL has migrated the rating on bank
facilities of NS to 'CRISIL D Issuer not cooperating'.
NS was set up in 1983 and is engaged in ship-breaking in Alang,
Gujarat. The firm's operations are managed by Mr. Mukund Nagarsheth
and his son, Mr. Devang Nagarsheth.
NAGOORAR ENTERPRISES: CRISIL Moves 'D' Rating to Not Cooperating
----------------------------------------------------------------
CRISIL has migrated the rating on bank facilities of Nagoorar
Enterprises (NE) to 'CRISIL D Issuer not cooperating'.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Cash Credit 8 CRISIL D (ISSUER NOT
COOPERATING; Rating Migrated)
Proposed Long Term 5.44 CRISIL D (ISSUER NOT
Bank Loan Facility COOPERATING; Rating Migrated)
Term Loan 5 CRISIL D (ISSUER NOT
COOPERATING; Rating Migrated)
CRISIL has been consistently following up with NE for obtaining
information through letters and emails dated December 31, 2019,
February 3, 2020 and February 7, 2020 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 NE, which restricts CRISIL's
ability to take a forward looking view on the entity's credit
quality. CRISIL believes information available on NE is consistent
with 'Scenario 1' outlined in the 'Framework for Assessing
Consistency of Information with CRISIL BB' rating category or
lower'.
Therefore, on account of inadequate information and lack of
management cooperation, CRISIL has migrated the rating on bank
facilities of NE to 'CRISIL D Issuer not cooperating'.
Set up in 1985, NE, a proprietorship firm of Mr N Shahul Hameed,
trades in scrap material such as mild steel, fly ash, and firewood,
sprint green and plastic scrap.
NAVRANG ROADLINES: Insolvency Resolution Process Case Summary
-------------------------------------------------------------
Debtor: Navrang Roadlines Private Limited
G-12-13 Vijay Plaza
Opp. Abad Dairy Kankaria Road
Ahmedabad 380022
Insolvency Commencement Date: February 24, 2020
Court: National Company Law Tribunal, Ahmedabad Bench
Estimated date of closure of
insolvency resolution process: August 24, 2020
Insolvency professional: Sachin Dinkar Bhattbhatt
Interim Resolution
Professional: Sachin Dinkar Bhattbhatt
A-103, Yogiraj Villa 2
Behind ISCON Heights
Kunal Cross Roads
Gotri-Laxmipura Road
Gotri, Vadodara
Gujarat
E-mail: sachin.bhattbhatt@gmail.com
- and -
212, Atlantis K-10, B Tower
Opp Honest Restaurant
Near Genda Circle
Sarabhai Road
Vadodara 390007
Gujarat
Last date for
submission of claims: March 13, 2020
NEELKANTH SURGICAL: Insolvency Resolution Process Case Summary
--------------------------------------------------------------
Debtor: Neelkanth Surgical Industries Private Limited
Registeres office:
27/9 B.N. Road, Lal Bagh
Lucknow, UP 226001
Insolvency Commencement Date: February 27, 2020
Court: National Company Law Tribunal, Lucknow Bench
Estimated date of closure of
insolvency resolution process: August 24, 2020
(180 days from commencement)
Insolvency professional: CS Shravan Kumar Vishnoi
Interim Resolution
Professional: CS Shravan Kumar Vishnoi
BCC Tower, 1008, 10th Floor
Sultanpur-Lucknow Road
Arjun Ganj, Near Saheed Path
Lucknow 226002
UP
E-mail: shravan.vishnoi@yahoo.com
Last date for
submission of claims: March 12, 2020
NEW ASIAN: CRISIL Migrates D Rating to Not Cooperating Category
---------------------------------------------------------------
CRISIL has migrated the rating on bank facilities of New Asian
Infrastructure Development Private Limited (NAIDPL) to 'CRISIL D
Issuer not cooperating'.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Term Loan 25 CRISIL D (ISSUER NOT
COOPERATING; Rating Migrated)
CRISIL has been consistently following up with NAIDPL for obtaining
information through letters and emails dated December 31, 2019,
February 3, 2020 and February 7, 2020, 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 NAIDPL, which restricts CRISIL's
ability to take a forward looking view on the entity's credit
quality. CRISIL believes information available on NAIDPL is
consistent with 'Scenario 1' outlined in the 'Framework for
Assessing Consistency of Information with CRISIL BB' rating
category or lower'.
Therefore, on account of inadequate information and lack of
management cooperation, CRISIL has migrated the rating on bank
facilities of NAIDPL to 'CRISIL D Issuer not cooperating'.
NAIDPL operates a setup a 7MW hydro power project in Nilwande in
Ahmednagar, Maharashtra on BOT basis. The unit commenced production
from November 2015. The company is promoted by Mr. Syed Abdur
Rasheed and his sons, Mr. Syed Abdur Zubair and Mr. Syed Abdur
Umair.
NOBILE ICE: Insolvency Resolution Process Case Summary
------------------------------------------------------
Debtor: Nobile Ice Cream Company Private Limited
B-13/8 (CA) Kalyani
WB 741235
- and -
715, Large Sector
Phase-VIII, Srirampur
Gamharia 832108
Insolvency Commencement Date: February 26, 2020
Court: National Company Law Tribunal, Kolkata Bench
Estimated date of closure of
insolvency resolution process: August 24, 2020
Insolvency professional: Mr. Sandip Kumar Kejriwal
Interim Resolution
Professional: Mr. Sandip Kumar Kejriwal
322, 3rd Floor, Martin Burn House
1, R.N. Mukherjee Road
Kolkata 700001
E-mail: sandipkej2@gmail.com
Last date for
submission of claims: March 11, 2020
ON-DOT COURIERS: Insolvency Resolution Process Case Summary
-----------------------------------------------------------
Debtor: On-Dot Couriers and Cargo Limited
Registered office:
Plot No. 7, 2nd Floor, Block-2
Kirti Nagar Industrial Area
New Delhi 110015
Insolvency Commencement Date: February 26, 2020
Court: National Company Law Tribunal, Principal Bench, New Delhi
Estimated date of closure of
insolvency resolution process: August 23, 2020
(180 days from commencement)
Insolvency professional: Shyam Arora
Interim Resolution
Professional: Shyam Arora
96, Aravali Apartment
Alaknanda, New Delhi 110019
E-mail: arora.shyaam@yahoo.com
cirp.ondot@gmail.com
Last date for
submission of claims: March 11, 2020
RADHA KRISHNA: Ind-Ra Lowers Issuer Rating to BB-, Outlook Stable
-----------------------------------------------------------------
India Ratings and Research (Ind-Ra) has downgraded Radha Krishna
Impex Private Limited's (RKIPL) Long-Term Issuer Rating to 'IND
BB-' from 'IND BBB-'. The Outlook is Stable.
The instrument-wise rating actions are:
-- INR105 mil. Fund-based limits downgraded with IND BB-/Stable
rating; and
-- INR30 mil. Non-fund-based limits downgraded with IND A4+
rating.
Downgraded
The downgrade reflects the weakening of legal ties between RKIPL
and its group entity, Unique Foods, resulting in a change in
Ind-Ra's analytical approach to standalone from consolidated. The
legal linkages have weakened because the corporate guarantee
between the companies ceased to exist as of January 2020. The
operational and strategic ties between the entities continue to be
moderate, with limited operational integration.
KEY RATING DRIVERS
RKIPL's revenue declined by 32% YoY to INR336.75million in FY19
(FY18: INR500 million), mainly due to a shortage of raw material
like mango pulp and loss of orders from a major customer. However,
the company's revenue is likely to be higher on a YoY basis in
FY20, considering the booking of revenue of INR400 million during
10MFY20, driven by the acquisition of customers. The scale of
operations continues to be small.
The ratings reflect the modest EBITDA margins due to the trading
nature of the business. The margin rose to 5.8% in FY19 (FY18:4.9%)
due to a decline in trading expenses. The RoCE was 5% in FY19
(FY18:7%).
The rating factor in the moderate credit metrics due to the modest
margins as well as high debt levels. The metrics deteriorated in
FY19 owing to a decline in the absolute EBITDA to INR19.50 mil.
(FY18: INR24.37 mil.) and an increase in net borrowings (in the
form of short-term borrowings) to INR148.46 million (FY18:
INR111.08million). The interest coverage ratio was 2.0x in FY19
(FY18:2.3x) and the net leverage was 7.5x (4.5x). In FY20, the
metrics are likely to improve on the back of an improvement in the
absolute EBITDA.
Liquidity Indicator - Stretched: RKIPL's average maximum
utilization of fund-based facilities was 82% in the 12 months
ending December 2019. The cash flow from operations turned negative
at INR35.5million in FY19 (FY18: INR73.63 million) due to the
decline in absolute EBITDA and increased utilization of working
capital limits. The free cash flow also turned negative at INR35.60
million in FY19 (FY18: INR73.26 million). In FY19, the working
capital cycle stretched to 218 days (FY18:107days) due to an
increase in inventory and debtor days.
The ratings are supported by favorable government policies, such as
the Vishesh Krishi Gram Udyog Yojana, for exporters.
The ratings also derive comfort from the directors' experience of
more than two decades in the trading business, along with its
established market position and strong customer base.
RATING SENSITIVITIES
Negative: Decline in the scale of operations along with a weakening
of the credit metrics or deterioration in the liquidity position
will be negative for the ratings.
Positive: An improvement in revenue and operating profitability,
leading to an improvement in the credit metrics, with the interest
coverage ratio rising above 2.0, will be positive for the ratings.
COMPANY PROFILE
RKIPL was incorporated in 1994 by Mr. Alok Kumar Kedia. It is
engaged in the trade of processed fruit pulp and is based out of
Muzaffarpur. It procures fruit pulp and concentrates and supplies
them to customers in states West Bengal, Odisha, and Bihar.
RADHARAMAN STAINLESS: CARE Cuts Rating on INR6.50cr Loan to B+
--------------------------------------------------------------
CARE Ratings revised the ratings on certain bank facilities of
Radharaman Stainless Steel Private Limited (RSSPL), as:
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long term bank 6.50 CARE B+; Stable Revised from
facilities CARE BB-; Stable
Short term bank
facilities 2.00 CARE A4 Reaffirmed
Detailed Rationale & Key Rating Drivers
Revision in the long term rating assigned to the bank facilities of
RSSPL factors in inadequate liquidity position to meet its
scheduled repayment obligations coupled with deterioration in
capital structure and debt coverage indicators in FY19. The
ratings continue to be constrained by its modest scale of operation
with low capitalization, thin profit margins, highly leveraged
capital structure and weak debt coverage indicators, working
capital intensive nature of operations, poor liquidity position,
susceptibility of profit margins to volatile material prices and
presence in competitive and fragmented industry.
The ratings however continue to draw strength from resourceful and
experienced promoters with more than two decades of experience in
the business.
Rating sensitivities
Positive factors
* Growth in total operating income: Growth in the total operating
income of the company to a level of around INR80-100 crore on
sustained basis
* Improvement in profit margins: Improvement in operating margin to
remain in range of 5-7% and net profit margin to remain in range of
3-5%
* Improvement in capital structure and debt coverage indicators:
Ability of the company to improve capital structure below unity and
interest ratio in range of 3-5x times and total debt /GCA in range
of 5-10x times.
Negative factors
* Elongation in collection and inventory holding period: Elongation
in collection and inventory holding period in the range of 130-150
days and 70-90 days respectively.
* Timely repayment of debt obligation: Inability of the company to
arrange for sufficient funds to meet its debt obligation in timely
manner.
Detailed description of Key rating drivers
Key Rating Weaknesses
Modest scale of operations along with growing though thin profit
margin
Total operating income (TOI) of the company continued to remain
modest however grew marginally to INR57.84 crore in FY19
(vis-à-vis INR55.11 crore in FY18) on account of on account of
increase in number of orders executed by the company in FY19.
Further the company has recorded total operating income of INR43
crore during 9MFY20. The profit margins of RSSPL continued to be
low however improved to 3.13% in FY19 from 3.07% in FY18 mainly on
account of lower cost incurred towards fuel and electricity
expenses, custom and excise duty, repair and maintenance in FY19.
With improvement in operating margin, PAT margin of the company
also improved marginally to 0.51% in FY19 from 0.46% in FY18.
Deterioration in capital structure and debt coverage indicators
Capital structure of the company continued to remain leveraged with
deterioration in overall gearing to 4.28x as on March 31, 2019 from
2.43x as on March 31, 2018 on account of increase in debt level due
to additional term loan availed to purchase land and higher
utilization of working capital bank borrowing as on March 31,
2019.
The debt coverage indicators also remained weak and deteriorated
with total debt/GCA remained at 56.95 times in FY19 visà-vis 34.81
times in FY18 on account of increase in debt level. However
interest coverage ratio marginally improved to 1.37x in FY19
vis-à-vis 1.32x in FY18 on account of improvement in operating
profitability.
Working capital intensive nature of operation with moderate
liquidity position
Operations of RSSPL continued to be working capital intensive
mainly on account of funds being blocked in receivables (avg.
collection period is 114 days) as company offers credit period of
around two-three months and inventory holding period remained high
at 59 days as on March 31, 2019 as company has to keep stock of raw
material to execute the orders of customers in timely manner.
Further company has recovered entire debtors out of outstanding
debtors of INR27.07 crore as on March 31, 2019. Further on the
other hand company has stretched payment to suppliers for around
three months which led to avg. creditors' period of 92 days.
Therefore, operations of the company remain working capital
intensive leading to working capital cycle period of 81 days and
utilization of its working capital limit (of INR6.50 crore) stood
at 95% for past twelve months ended December, 2019.
Poor liquidity position
Liquidity position stood poor with low gross cash accruals to meet
its scheduled repayment obligations of additional term loan availed
in FY19. However, current ratio remained moderate at 1.24x as on
March 31, 2019 vis-à-vis 1.55x as on March 31, 2018. Further free
cash and bank balance remained low at INR0.91 crore as on March 31,
2019 vis-à-vis INR0.09 crore as on March 31, 2018.
Susceptibility of profit margins to volatile material prices
The material is the major cost driver (constituting about 96% of
total cost of sales in FY19) and the prices of the same are
volatile in nature therefore cost base remains exposed to any
adverse price fluctuations in the prices of the steel being major
cost components amongst all materials are volatile in nature.
Accordingly, the profitability margins of the company are
susceptible to fluctuation in material prices. With limited ability
to pass on the increase in material costs in a competitive
operating spectrum, any substantial increase in material costs
would affect the company's profitability.
Presence in competitive and fragmented industry
RSSPL operates in a highly competitive and fragmented steel
industry. The company witnesses intense competition from both the
other organized and unorganized players domestically and globally.
This fragmented and highly competitive industry results into price
competition thereby posing a threat to the profit margins of the
companies operating in the industry.
Key rating Strengths
Experienced promoters
RSSPL is currently managed by Mr. Purushottam Dass Garg and Mr.
Anil Garg who have more than two decades of experience in the steel
industry. Directors are further assisted by second line of
management and experienced force of labourer who undertake day to
day activities. Company has established relationship with various
suppliers and customers over the period of time which enabling
continuous and repeated orders from client.
Radharaman Stainless Steel Private Limited (RSSPL) was incorporated
in the year 1985 as a private limited company and is managed by Mr.
Purushottam Dass Garg and Mrs. Anita Garg who are having more than
three decades of experience in the business. RSSPL is engaged in
the business of manufacturing of stainless steel sheets and circle
of different measurements as per the requirement of clients.
Company purchases steel coils from suppliers located in domestic
market and sells its products to wholesalers of cutlery and utensil
manufacturers. Company has its registered office and processing
plant in Alwar, Rajasthan.
SHRI BAHUBALI: CRISIL Assigns B+ Rating to INR2.8cr Term Loan
-------------------------------------------------------------
CRISIL has assigned its 'CRISIL B+/Stable' rating to the long-term
bank facilities of Shri Bahubali Traders (SBT).
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Term Loan 2.8 CRISIL B+/Stable (Assigned)
Cash Credit .5 CRISIL B+/Stable (Assigned)
Proposed Long Term
Bank Loan Facility 1.7 CRISIL B+/Stable (Assigned)
The rating reflects the modest scale of SBT's operations and a weak
financial risk profile. These weaknesses are partially offset by
the extensive experience of the promoters in the textile printing
industry, and the adoption of latest machinery for the new unit.
Key Rating Drivers & Detailed Description
Weaknesses
* Modest scale of operations
Risks related to the initial stage of the business (fiscal 2019 was
SBT's first year of operations) along with intense competition may
continue to constrain scalability, pricing power, and
profitability.
* Weak financial risk profile
Financial risk profile is like to remain average. Net worth was low
at INR2.73 crore as on March 31, 2019, with total outside
liabilities to tangible net worth TOLTNW ratio high at 2.20 times.
Strengths
* Extensive experience of the promoters
Benefits from the promoters' experience of over a decade, their
strong understanding of local market dynamics, and healthy
relations with customers and suppliers should continue to support
the business.
* Adoption of latest machinery in steady industry
SBT is currently setting a new unit, which is being equipped with
all the latest equipment and technology. Consequently, healthy
business growth is expected over the medium term.
Liquidity Stretched
Liquidity may continue to be weak. Cash accrual is projected at
INR0.6-0.9 crore per annum over the medium term, barely sufficient
to meet the yearly maturing debt of INR0.4 crore. Bank limit
utilisation was high and averaged 85% during the 12 months through
October, 2019. However, the timely, need-based funds extended by
the promoters partially supports the business.
Outlook: Stable
CRISIL believes SBT will continue to benefit from the extensive
experience of the promoters.
Rating Sensitivity Factors
Upward factors
* Revenue of more than INR20 crore, with an operating margin of 8%
* Prudent working capital management
Downward factors
* Net cash accrual to total debt ratio dropping to less than 1
time
* Significant stretch in the working capital cycle.
SBT, set up in 2018, is a Meerut (Uttar Pradesh)-based firm that
undertakes textile printing, with installed capacity of 50 thousand
metres per month; the firm should commence operations from December
2018. Mr Siddhant Jain, Mr Rahul Jain, Mr Rahul Jain, and Ms Sapna
Jain are the promoters.
SHUKRA JEWELLERY: CRISIL Lowers Rating on INR17.05cr Loan to D
--------------------------------------------------------------
CRISIL has downgraded the rating on the long-term bank facility of
Shukra Jewellery Limited (SJL) to 'CRISIL D Issuer Not Cooperating'
from 'CRISIL B-/Stable Issuer Not Cooperating'.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Term Loan 17.05 CRISIL D (ISSUER NOT
COOPERATING; Downgraded from
'CRISIL BB-/Stable ISSUER
NOT COOPERATING')
CRISIL has been consistently following up with SJL for obtaining
information through letters and emails dated December 31, 2019, and
January 6, 2020, among others, apart from telephonic communication.
However, the issuer has remained non-cooperative.
'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 they are arrived at without any
management interaction and are based on best available or limited
or dated information on the entity'.
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 SJL, which restricts CRISIL's
ability to take a forward-looking view on the entity's credit
quality. CRISIL believes the information available is consistent
with 'Scenario 1' outlined in the Framework for Assessing
Consistency of Information with 'CRISIL BB' rating category or
lower.
Due to delay by the company in servicing its term debt obligations,
CRISIL has downgraded the rating on the long-term bank facility to
'CRISIL D Issuer Not Cooperating' from 'CRISIL B-/Stable Issuer Not
Cooperating'.
SJL, a BSE listed company is completely engaged in the development
of affordable housing real estate from fiscal 2019 but was engaged
in trading of gems and jewellery in the past till fiscal 2018. It
is promoted and is currently being run by Mr. Chandrakant Shah.
SPI ENGINEERS: CARE Reaffirms B+ Rating on INR6.0cr LT Loan
-----------------------------------------------------------
CARE Ratings reaffirmed ratings on certain bank facilities of SPI
Engineers Private Limited (SPI), as:
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long-term Bank
Facilities 6.00 CARE B+; Stable Reaffirmed
Detailed Rationale and key rating drivers
The ratings assigned to the bank facilities of SPI continue to
remain constrained by its small scale of operations, declining
profitability along with weak debt coverage indicators and
elongated operating cycle. The ratings are, further constrained by
intense competition in the industry due to low entry barriers.
The ratings, however, continue to take comfort from experience
directors, moderate debt profile and profit margins.
Detailed description of the key rating drivers
Positive Sensitivity
* Stabilisation in scale of operation with total operating income
exceeding INR50.00 crores on sustained basis.
* Improvement in PBILDT and PAT margins, on sustainable basis,
above10 % and 5.00 % respectively.
Negative Sensitivity
* Deterioration in capital structure with deterioration in overall
gearing above 3.0x on continuous basis.
Key Rating Weaknesses
Small and declining scale of operations
Despite being operational for almost one and a half decade, the
scale of operations continues to remain small marked by a total
operating income and gross cash accruals of INR9.71 crore and
INR0.30 crore respectively during FY19 (refers to the period April
1 to March 31). Further the total operating income of the company
has been declining for the past three financial years i.e.
FY17-FY19. The decline is on account of low orders received from
existing client. The company's capital base was relatively small at
INR2.19 crore as on March 31, 2019. The small scale limits the
company's financial flexibility in times of stress and deprives it
of scale benefits. In 10MFY19 (refers to the period April 01 to
January 31; based on provisional results), the company has achieved
TOI of INR19.00 crore.
Declining profitability and weak debt coverage indictors
Profit margins as marked by PBILDT margin and PAT margin declined
in FY19 to 4.51% and 1.99% respectively from 6.96% and 2.005
respectively in FY18 registering a dip of 218 bps in PBILDT as
company operates in highly competitive industry. Owing to low
profitability, debt coverage indicators as marked by total debt to
GCA stood weak at 8.82 times in FY19.
Elongated Operating Cycle
The operating cycle of the company remains elongated around 164
days in FY19 to 162 days in FY18. The average collection period
decreased from 105 days for FY18 to 70 days for FY18 to due to
timely receipt of payment from its customer. The company is
required to maintain adequate inventory of raw material for smooth
running of its production processes. Furthermore, being a trader
the company has to maintain minimum inventory of goods in order to
meet the demand to meet the sudden demand of its customers, which
leads to average inventory holding for around 6 months, the
inventory has elongated on account of diversified product base.
The utilization levels of fund based working capital limit for last
twelve months ended January 31, 2020 stood around 75% per cent.
Intense competition in the industry due to low entry barriers
The company is operating in a competitive industry wherein there is
presence of a large number of players in the unorganized and
organized sectors. The company is comparative a small players
catering to the same market which has limited the bargaining power
of the company and has exerted pressure on its margins.
Key rating Strength
Experienced director
The operations of SPI are currently managed by Mr. Sandeep Arora
and Ms. Kamla Arora. Mr. Sandeep Arora is a graduate by
qualification and has an experience of around three decades in
trading of equipment through SPI and also through other family run
business. Ms. Kamla Arora is also a graduate by qualification has
an experience of four decades in trading of equipment industry
through her association with SPI entity and also through family run
business. They both look after the overall operations of the
company.
Moderate capital structure
Debt profile, primarily, constitute of working capital borrowings
which stood at INR2.49 crores as on March 31, 2019 and unsecured
loans of INR0.13 crores. During FY19, low reliance on external
borrowings lead to moderate debt profile. As on March 31, 2109,
overall gearing stood at 1.20x as against overall gearing of 1.79
times as on March 31, 2018.
Liquidity analysis: Stretched
In FY19, cash accruals stood low at INR0.30 crores. The working
capital limits also remain utilized around 75% in past 12 month
ending January 31, 2020. Liquidity indicators also remained modest
marked by current ratio and quick ratio of 1.34x and 0.51x
respectively as on March 31, 2019 along with working capital cycle
of 164 days.
Delhi based SPI Engineers Private Limited (SPI) was incorporated in
1999 by Mr. Sandeep Arora and Ms. Kamla Arora. SPI is an authorized
distributor for Fluke, EXFO, Rohde and Schwarz , Leica etc. of
their products such which includes electronic test and measuring
instruments like digital multi meter, clamp meter, earth ground
tester etc, optical microscopes, calibrators, radio test set, audio
analyzer etc. Their major Customers include Government organization
and Defence Reaserach and Development Organization labs like
Industrial Training Institute ltd, Bharat Electricals Limited,
Centre for Development of Telematics; educational institutions like
Indian Institute of Technology Delhi Technological University and
industrial clients like Maruti Suzuki, Hero Motorcop etc.
SRI CHAITANYA: CARE Cuts INR8.0cr LT Loan Rating to B+, Not Coop.
-----------------------------------------------------------------
CARE Ratings revised the ratings on certain bank facilities of Sri
Chaitanya Rice Mill (SCRM), as:
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long term Bank 8.00 CARE B+; Stable; Issuer not
Facilities cooperating; Revised from
CARE BB-; Stable on the basis
of best available information
Detailed Rationale & Key Rating Drivers
CARE has been seeking information from SCRM to monitor the rating
vide e-mail communications dated November 12, 2019, November 26,
2019, January 3, 2020, January 6, 2020, February 7, 2020 and
numerous phone calls. However, despite our 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 the best available information which
however, in CARE's opinion is not sufficient to arrive at a fair
rating. The rating on SCRM's bank facilities will now be CARE B+;
Stable; ISSUER NOT COOPERATING.
Users of this rating (including investors, lenders and the public
at large) are hence requested to exercise caution while using the
above ratings.
The revision in the rating assigned to the bank facilities of SCRM
takes into account no due-diligence conducted with auditor and
non-availability of information due to non-cooperation by SCRM with
CARE'S efforts to undertake a review of the rating outstanding.
CARE views information availability risk as a key factor in its
assessment of credit risk.
The rating takes into account its small scale of operations along
with low profit margins, leveraged capital structure and weak debt
coverage indicators, moderate liquidity position, susceptibility
of profit margins due to volatile raw material prices, presence in
competitive and fragmented industry and proprietorship nature of
its constitution.
The rating however, derives strength from long track record coupled
with experienced proprietor in the business and presence in various
states of India.
Detailed description of the key rating drivers:
At the time of last rating on April 9, 2019 the following were the
rating strengths and weaknesses:
Key Rating Weaknesses
Small scale of operations along with low profit margins: Total
operating income of the entity remained small during past four
years ended FY18. Total operating income (TOI) of the company grew
by 63.17% to INR24.59 crore in FY18 (vis-à-vis INR15.07 crore in
FY17) due to increase in demand and price of the rice and increased
focus on marketing activities undertaken by entity during FY18.
Further during 10MFY19, entity has achieved total operating income
of INR25 crore. The operating profit margins of company have been
low and in the range of 2.02% to 3.73% during FY15-FY18 from the
past four years ended FY18. Further it declined marginally to 3.18%
in FY18 from 3.22% in FY17 mainly on account of increase in
material cost, employee cost and administrative expenses in FY18.
Further during FY18, net profit margin of the entity stood low and
declined to 0.91% vis-à-vis 0.97% in FY17 which is in line with
the decline in PBILDT margin and increase in interest and
depreciation charges.
Leveraged capital structure and weak debt coverage indicators:
Capital structure of the company remained leveraged in the range of
1.96x to 2.00x during past three balance sheet dates ended March
31, 2018 on account of high debt level and lower net worth base.
Further overall gearing of the company stood stable at 1.96x as on
March 31, 2018 and March 31, 2017. The debt coverage indicators
remained weak with further deterioration in total debt to gross
cash accruals at 15.73x in FY18 visà-vis 13.30x in FY17 due to
increase in debt level. Further interest coverage ratio also
declined to 2.32x in FY18 from 2.71x in FY17 due to increase in
interest expenses and decline in PBILDT.
Moderate liquidity position: Liquidity position stood moderate with
current ratio of 1.23x as on March 31, 2018 and quick ratio of
0.07x in FY18. Further free cash and bank balance remained low at
INR0.02 crore as on March 31, 2018 vis-àvis INR0.10 crore as on
March 31, 2017. Operations of SCRM are working capital intensive
mainly on account of funds being blocked in inventory (average
inventory period is 214 days) as paddy being the seasonal product
which is available from December to February in the market ,thus
the entity has to maintain stock of paddy in its warehouse for
which it does the processing for the entire year. Further entity
receives payment in 10-15 days from its customers which led to
average collection period of 11 days. Further out of total debtors
outstanding of INR1.03 crore as on March 31, 2018, all the debtors
have been recovered as on February 19, 2019. Further on the other
hand it makes upfront payment to raw material suppliers. All taken
collectively, operations of the company remains working capital
intensive leading to average utilization of 80% of its working
capital limit (Rs. 8 crore) for past twelve months ended January
2020.
Susceptibility of profit margins due to volatile raw material
prices: The raw material is the major cost driver (constituting
about 97% of total cost of sales in FY18) and the prices of the
same are volatile in nature therefore cost base remains exposed to
any adverse price fluctuations in the prices of the raw material.
Paddy being major cost component amongst all raw materials is
volatile in nature. Accordingly, the profitability margins of the
company are susceptible to fluctuation in raw material prices. With
limited ability to pass on the increase in raw material costs in a
competitive operating spectrum, any substantial increase in raw
material costs would affect the company's profitability.
Presence in competitive and fragmented industry: Entity operates in
a highly competitive and fragmented agro processing industry. The
company witnesses intense competition from both the other organized
and unorganized players domestically. This fragmented and highly
competitive industry results into price competition thereby posing
a threat to the profit margins of the companies operating in the
industry.
Proprietorship nature of constitution: Being a proprietorship
concern, SCRM has inherent risk of withdrawal of proprietor's
capital at the time of personal contingency. Furthermore, it has
restricted access to external borrowings where net worth as well as
creditworthiness of the proprietor are the key factors affecting
credit decision of the lenders. Hence, limited funding avenues
along with limited financial flexibility have resulted in small
scale of operations for the entity.
Key rating Strengths
Long track record coupled with experienced proprietor in the
business and presence in various states of India: SCRM possesses an
established track record of more a decade in the business and is
promoted by proprietor Ms. T. Satyavati who has rich experience for
more than two decades in the industry. Proprietor is assisted by
Mr. T. Veerbhardrarao and Mr. T. Lakshmiarayana who have more than
two decades of experience in the business and experienced
management team in the field of accounts, sales and production to
carry out day-to-day operations. Further entity has presence in
various states of India for supply of rice to wholesalers in APMC
markets situated in Karnataka, Tamil Nadu, Andhra Pradesh and
Maharashtra.
Sri Chaitanya Rice Mill (SCRM) was incorporated in 2006, by Ms. T.
Satyavati. SCRM is engaged in the processing paddy into rice, and
generates by-products such as broken rice, bran, and husk. Entity
has rice unit in Nagpur with an installed capacity of 4 tons per
hour. It procures paddy from the farmers in the domestic market and
final product i.e. rice is supplied to wholesalers in APMC markets
situated in Karnataka, Tamil Nadu, Andhra Pradesh and Maharashtra.
Further company also sells rice bran to the oil refineries situated
in nearby areas.
SRI VYSHNAVI: CRISIL Cuts Rating on INR6cr Cash Loan to B+
----------------------------------------------------------
CRISIL said the ratings on bank facilities of Sri Vyshnavi Dairy
Specialities Private Limited (SVDSPL) was revised to 'CRISIL
B+/Stable Issuer not cooperating' from 'CRISIL BB-/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')
Proposed Long Term 4.91 CRISIL B+/Stable (ISSUER NOT
Bank Loan Facility COOPERATING; Revised from
'CRISIL BB-/Stable ISSUER NOT
COOPERATING')
Term Loan 3.09 CRISIL B+/Stable (ISSUER NOT
COOPERATING; Revised from
'CRISIL BB-/Stable ISSUER NOT
COOPERATING')
CRISIL has been consistently following up with SVDSPL for obtaining
information through letters and emails dated July 29, 2019 and
January 10, 2020 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 SVDSPL, which restricts CRISIL's
ability to take a forward looking view on the entity's credit
quality. CRISIL believes information available on SVDSPL 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 SVDSPL Revised to 'CRISIL B+/Stable Issuer not
cooperating' from 'CRISIL BB-/Stable Issuer not cooperating'.
Furthermore, the company has not paid the fee for conducting rating
surveillance as agreed to in the rating agreement.
Incorporated in 1999 as a private limited company, SVDSPL processes
milk and manufactures milk products such as ghee, butter and curd.
The company, based in Chennai and is promoted by Mr Rajesh Chavda,
MrVenkateswara Rao, Mr Guptha and Mr Murlidhar Bhutada.
SURYATAAP ENERGIES: Ind-Ra Cuts Term Loan Rating to B+, Not Coop.
-----------------------------------------------------------------
India Ratings and Research (Ind-Ra) has downgraded Suryataap
Energies & Infrastructure Private Limited's (SEIPL) senior project
term loans' rating to 'IND B+ (ISSUER NOT COOPERATING)' from 'IND
BB+ (ISSUER NOT COOPERATING)'. The issuer did not participate in
the rating exercise despite continuous requests and follow-ups by
the agency. Thus, the rating is based on the best available
information. Therefore, investors and other users are advised to
take appropriate caution while using the rating. The rating will
now appear as 'IND B+ (ISSUER NOT COOPERATING)' on the agency's
website.
The instrument-wise rating action is:
-- INR259.2 mil. Senior project term loan due on March 31, 2034
downgraded with IND B+ (ISSUER NOT COOPERATING) rating.
Note: ISSUER NOT COOPERATING: Issuer did not cooperate; based on
the best available information
KEY RATING DRIVERS
The downgrade reflects the continued absence of clarity regarding
SEIPL's operational and financial performance, the company's
ability to ensure timely debt servicing, and the financial
flexibility of the sponsor, Hindustan Clean Energy Limited ('IND
BBB- (ISSUER NOT COOPERATING)'.
SEIPL has signed a 25-year power purchase agreement at a fixed
tariff of INR8.78/kWh for power supply to Assam Power Distribution
Company Limited and achieved commercial operations date in August
2016. However, the absence of information on the company's
operational track record to demonstrate plant performance, grid
availability and receivable days constrains the rating.
The rating has been maintained in the non-cooperating category as
SEIPL did not provide information related to its business and
financial profiles despite continuous requests and follow-ups by
the agency.
COMPANY PROFILE
SEIPL is a wholly-owned subsidiary and special purpose vehicle of
Hindustan Clean energy. It was formed to build and operate a 5MW
solar photovoltaic power plant in Sonitpur District, Assam.
SVM NONWOVENS: CRISIL Lowers Rating on INR10.6cr New Loan to D
--------------------------------------------------------------
CRISIL has downgraded its rating on the long-term bank facilities
of SVM Nonwovens Private Limited (SVM) to 'CRISIL D' from 'CRISIL
B-/Stable'.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Cash Credit 1.2 CRISIL D (Downgraded from
'CRISIL B-/Stable')
Long Term Loan 3.2 CRISIL D (Downgraded from
'CRISIL B-/Stable')
Proposed Fund- 10.6 CRISIL D (Downgraded from
Based Bank Limits 'CRISIL B-/Stable')
The downgrade reflects delay in servicing term loans for 60 days on
account of poor liquidity.
The rating reflects the company's weak financial risk profile and
modest scale of operations. These weaknesses are partially offset
by the extensive industry experience of its promoters.
Key Rating Drivers & Detailed Description
Weaknesses
* Delay in debt servicing: Delay in term loan repayment for 60 days
has resulted in the default rating.
* Weak financial risk profile
The networth was low at INR2.41 crore as on March 31, 2019, and is
likely to remain the same over the medium term. The gearing was
very high at 8.08 times. Total outside liabilities to total
networth ratio was also very high at 8.48 times and is expected
remain high over the medium term.
* Modest scale of operations
Revenue of INR6.38 crore in fiscal 2019 reflects the company's
subdued scale and limited production capacity, which has restricted
its top line. The company's small scale of operations limits its
ability to take advantage of the economies of scale that other big
players in the industry are able to leverage.
Strengths
* Extensive industry experience of the promoters
The promoters have nearly three decades of experience in the
nonwoven industry. Mr P V Rao, SVM's managing director, has strong
industry experience. Over the years, the company has focused on
research and development, and has continuously evolved its products
to meet increasing customer requirements. Furthermore, they have
developed healthy relationships with various customers and
suppliers supporting the business risk profile of the company.
Liquidity Poor
There have been delays in repayment of term loans and interest
payment. Average bank limit utilisation was 95% during the 12
months through December 2019, and is expected to remain high on
account large working capital requirement.
Rating Sensitivity Factors
Upward factors
*Track record of timely debt servicing for more than three months
*Significant revenue growth and sizable increase in cash accrual.
Established in 1998, SVM manufactures nonwoven fabric, nonwoven
filter cloths, and geotextiles. The company is promoted by Mr P.V.
Rao and Mrs P. Maruti and is located at Shadnagar, Telangana.
TOPWORTH STEELS: Insolvency Resolution Process Case Summary
-----------------------------------------------------------
Debtor: Topworth Steels and Power Private Limited
308, 3rd floor Ceejay House
Dr. A.B. Road, Worli
Mumbai, Maharashtra 400018
Insolvency Commencement Date: February 28, 2020
Court: National Company Law Tribunal, Mumbai Bench
Estimated date of closure of
insolvency resolution process: August 26, 2020
Insolvency professional: Dushyant C Dave
Interim Resolution
Professional: Dushyant C Dave
1101, Dalamal Tower
Free Press Journal Marg
Nariman Point
Mumbai 400021
E-mail: dushyant.dave@
decoderesolvency.com
topworth@decoderesolvency.com
Last date for
submission of claims: March 13, 2020
UNITED FORTUNE: CRISIL Lowers Rating on INR18cr Loan to 'D'
-----------------------------------------------------------
CRISIL has revised the ratings on bank facilities of United Fortune
International Private Limited (UFIPL) to 'CRISIL D Issuer Not
Cooperating' from 'CRISIL A4 Issuer Not Cooperating'. The rating
downgrade reflects classification of UFIPL as non performing asset
(NPA) by the lender.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Packing Credit 18 CRISIL D (ISSUER NOT
COOPERATING; Downgraded from
'CRISIL A4 ISSUER NOT
COOPERATING')
Proposed Short Term 3 CRISIL D (ISSUER NOT
Bank Loan Facility COOPERATING; Downgraded from
'CRISIL A4 ISSUER NOT
COOPERATING')
CRISIL has been consistently following up with UFIPL 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 UFIPL, which restricts CRISIL's
ability to take a forward looking view on the entity's credit
quality. CRISIL believes information available on UFIPL is
consistent with 'Scenario 1' outlined in the 'Framework for
Assessing Consistency of Information with CRISIL BB' rating
category or lower'.
Furthermore, the company has not paid the fee for conducting rating
surveillance as agreed to in the rating agreement.
Based on the last available information, the ratings on bank
facilities of UFIPL revised to be 'CRISIL D Issuer Not Cooperating'
from 'CRISIL A4 Issuer Not Cooperating'. The rating downgrade
reflects classification of UFIPL as non performing asset (NPA) by
the lender.
For arriving at the rating, CRISIL has combined the business and
financial risk profiles of UFIPL and Pinnacle Nexus Limited (PNL).
This is because the two companies, together referred to as the
Pinnacle group, are engaged in the same business, have common
customers and suppliers, and are managed by the same promoter
family.
PNL was established in June 2007 in Navi Mumbai (Maharashtra). The
company is promoted by Mr. Sohail Munshi, who is its chairman and
managing director. The company trades in readymade garments (RMGs),
fabric, leather garments, and imitation jewellery, and primarily
exports to the Middle East, Asia, and Africa.
UFIPL was established in December 2011 in Mumbai. The company is
promoted by Mr. Sohail Munshi's younger brother, Mr. Ahtesham
Munshi. It trades in RMGs and fabric; it exports to the Middle
East, Asia, and Africa.
The two companies are ISO 9001:2008-certified and
government-recognised star export houses.
UNNATI WRITING: CRISIL Cuts Rating on INR11cr Cash Loan to 'D'
--------------------------------------------------------------
CRISIL has downgraded its rating on the long-term bank facilities
of Unnati Writing Products Private Limited (Unnati) to 'CRISIL D'
from 'CRISIL B+/Stable'.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Cash Credit 11 CRISIL D (Downgraded from
'CRISIL B+/Stable')
Term Loan 3 CRISIL D (Downgraded from
'CRISIL B+/Stable')
The downgrade reflects delays in repayment of term loan principal
and payment of interest.
The company also has large working capital requirement, a small
scale of operations amid intense competition, and is susceptible to
volatility in raw material prices and foreign exchange (forex)
rates. However, it benefits from the extensive experience of the
promoters in the writing instruments segment.
Key Rating Drivers & Detailed Description
Weakness:
* Delay in debt servicing: The company has delayed in payment of
term loan principal and interest due to stretched liquidity.
* Large working capital requirement
Gross current assets (GCAs) were high at 274 days as on March 31,
2019. Operations are expected to remain working capital intensive
over the medium term.
* Small scale of operations amid intense competition
Net sales were modest at INR33.89 crore in fiscal 2019. There is
intense competition from players in the unorganised sector, leading
to pricing pressure. The intense competition should keep the scale
of operations modest over the medium term.
* Susceptibility of the operating margin to volatility in raw
material prices and forex rates
The price of the key raw material, plastic granules, is volatile.
Steady rise in polymer prices, which are correlated with crude oil
prices, will hit operating profitability, as any increase cannot be
fully passed on. The cost of raw materials constitute 65-70% of
sales. Volatility in raw material prices should continue to impact
profitability over the medium term.
Strengths:
* Extensive industry experience of the promoters
The promoters have been in the writing instruments industry for
more than two decades and have developed a healthy relationship
with customers, both domestic and overseas, resulting in repeat
orders. Also, geographically diversified revenue should help to
withstand any slowdown or change in consumer preferences in a
particular region.
Liquidity Poor
The bank limits are almost fully utilized. Company has delayed in
the payment of Term loan principal and interest due to stretched
liquidity.
Rating Sensitivity factors
Upward factors:
* Timely payment of principal and interest on the term loan with a
minimum track record of three months
* Improvement in working capital management, leading to GCAs of
below 150 days
Unnati was set up as a partnership firm by Mr Sudarshan Gupta, his
brother Mr Suranjan Gupta, and Mr Raj Kumar Goel in 2001. It was
reconstituted as a private limited company in 2009. The company
manufactures ball pens, fountain pens, roller pens, and gel pens.
VASUNDHARA MERCHANTS: CRISIL Assigns B Rating to INR5cr Term Loan
-----------------------------------------------------------------
CRISIL has assigned its 'CRISIL B/Stable' rating to the long-term
bank facility of Vasundhara Merchants Limited (VML).
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Cash Term Loan 5 CRISIL B/Stable (Assigned)
The rating reflects a modest scale of operations amid intense
competition, and weak operating efficiency. These weaknesses are
partially offset by the extensive entrepreneurial experience of the
promoters and a healthy capital structure.
Key Rating Drivers & Detailed Description
Weaknesses
* Modest scale of operations amid intense competition: Due to the
presence of a large number of organised and unorganised players in
the cold storage segment, driven by low capital requirement,
competition is intense. The company's modest scale of operations
thus restricts negotiating power with suppliers and customers, and
the ability to withstand business downturns, and should continue to
limit operating flexibility.
* Weak operating efficiency: The return on capital employed is low,
driven by limited capacity utilisation and sluggish demand.
Strengths
* Extensive entrepreneurial experience of the promoters: The
promoters have an experience of over 10 years in the broking
industry. This has given them an understanding of the dynamics of
the market, and enabled them to establish relationships with
suppliers and customers.
* Healthy capital structure: Limited reliance on external funds has
resulted in a low total outside liabilities to tangible networth
ratio in the three fiscals ended March 31, 2019.
Liquidity Stretched
Cash accrual is expected at around INR1.1 million, against term
debt obligation of INR0.7 million, per fiscal over the medium term;
the excess will act as a cushion to liquidity. The current ratio
was healthy at 14.14 times on March 31, 2019. A low gearing and a
moderate networth support financial flexibility, and provide a
cushion in case of any adverse conditions or downturns in the
business.
Outlook: Stable
CRISIL believe VML will continue to benefit from the extensive
experience of the promoters and established relationship with
clients.
Rating Sensitivity Factors
Upward factors
*Start of operations by the first quarter of fiscal 2021, leading
to net cash accrual of more than INR60 lakh in the fiscal
*Higher-than-envisaged capital infusion by the promoters, resulting
in a healthier capital structure
Downward factors
*Delay in start of operations beyond June 2020, leading a mismatch
between cash generation and repayment obligation
*Large, debt-funded capital expenditure, weakening the capital
structure
*A substantial increase in working capital requirement, thus
weakening the overall financial profile, especially liquidity.
VML, incorporated in 1996, is owned and managed by Mrs Sapna Devi
Agarwal, Mr Bimal Kumar Agarwal, and Mr Vikram Agarwal. The
promoters, based in Kolkata, are engaged in providing shares and
securities broking services. They have acquired a cold storage unit
under VML, which is based in Paschim Medinipur, West Bengal.
VENESSA METALS: Insolvency Resolution Process Case Summary
----------------------------------------------------------
Debtor: Venessa Metals & Alloys Private Limited
A-93, South Extension Part-2
South Delhi 110049
Insolvency Commencement Date: February 19, 2020
Court: National Company Law Tribunal, New Delhi Bench
Estimated date of closure of
insolvency resolution process: August 17, 2020
Insolvency professional: Mr. Ashish Singh
Interim Resolution
Professional: Mr. Ashish Singh
Unit No. 811, 8th Floor
Aggarwal Millenium Tower-1
Near BTW, Netaji Subhash Place
Pitampura, New Delhi
National Capital Territory of Delhi
110034
E-mail: ashishsinghcs@gmail.com
vmapl.ip@gmail.com
Last date for
submission of claims: March 13, 2020
VISHNURAAM TEXTILES: CRISIL Keeps 'D' Rating in Not Cooperating
---------------------------------------------------------------
CRISIL said the ratings on bank facilities of Vishnuraam Textiles
Limited (VTL) continues to be 'CRISIL D/CRISIL D Issuer not
cooperating'.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Bank Guarantee .11 CRISIL D (ISSUER NOT COOPERATING)
Cash Credit 4.30 CRISIL D (ISSUER NOT COOPERATING)
Letter of Credit 2.75 CRISIL D (ISSUER NOT COOPERATING)
Long Term Loan 6.82 CRISIL D (ISSUER NOT COOPERATING)
CRISIL has been consistently following up with VTL for obtaining
information through letters and emails dated July 29, 2019 and
January 10, 2020 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 VTL, which restricts CRISIL's
ability to take a forward looking view on the entity's credit
quality. CRISIL believes information available on VTL 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 VTL continues to be 'CRISIL D/CRISIL D Issuer not
cooperating'.
Furthermore, the company has not paid the fee for conducting rating
surveillance as agreed to in the rating agreement.
Incorporated in 1990, VTL is into manufacturing of cotton yarn. The
company has its manufacturing facilities in Tirupur and Udumalpet.
VSRK CONSTRUCTIONS: CRISIL Cuts Rating on INR13cr Loan to 'D'
-------------------------------------------------------------
CRISIL has downgraded its ratings on the bank facilities of VSRK
Constructions (VSRK) to 'CRISIL D/CRISIL D' from 'CRISIL
BB/Stable/CRISIL A4+'. The ratings reflect the firm's overdrawn
cash credit limit for more than 30 days because of weak liquidity.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Bank Guarantee 13 CRISIL D (Downgraded from
'CRISIL A4+')
Cash Credit 2 CRISIL D (Downgraded from
'CRISIL BB/Stable')
The rating also reflects the firm's modest scale of operations and
average financial risk profile. These weaknesses get partially
offset by extensive experience of the promoters.
Key Rating Drivers & Detailed Description
Weaknesses:
* Overdrawn cash credit facility for more than 30 days because of
weak liquidity:
Liquidity is weak, as reflected in instances of the cash credit
facility being overdrawn for more than 30 days in the past six
months and bank lines almost fully utilised over the 12 months
through January 2019
* Modest scale of operations in fragmented industry:
The firm's scale of operations is modest as reflected in revenues
of INR40.4 crore for fiscal 2019. The scale of operations is
expected to remain modest over the medium term.
* Average Financial Risk Profile: The financial risk profile is
average reflected by small networth of INR10.2 crore and moderate
gearing of 1.42 times as on March 2019.
Strengths:
* Extensive experience of promoters: Industry presence of over 25
years has enabled the promoters to forge strong relationship with
customers (government agencies) and raw material suppliers. The
firm also benefits from its proven execution track record in
implementing contracts.
Liquidity Poor
Liquidity is poor. Weak liquidity has resulted in overdrawals of
the working capital limits for more than 30 days. The firm's
operations are working capital intensive operations and hence is
highly dependent on external debt for meeting its working capital
requirements.
Rating Sensitivity factors
Upward factors
* Track record of timely debt servicing for at least over 90 days
* Improvement business performance and receivable days resulting in
better liquidity profile.
Established in 2002 by Mr N T Venkateswara Rao and Mr Ch.
Venkateswara Rao, VSRK constructs roads and bridges in Andhra
Pradesh and Telangana. The firm is recognized as a special class
contractor by Roads and Buildings department of Andhra Pradesh and
Telangana.
===============
M A L A Y S I A
===============
APFT BHD: To Be Delisted on March 16 Unless Appeal is Made
----------------------------------------------------------
Justin Lim at The Edge Financial Daily reports that Practice Note
17 (PN17) company APFT Bhd will be delisted from the Main Market of
Bursa Malaysia on March 16 unless an appeal is made, after the
bourse regulator dismissed the company’s request for more time to
submit its regularisation plan.
Prior to the delisting, trading of APFT shares will be suspended
from March 12, the report says.
Should the company wish to appeal, it should be made on or before
March 11, Bursa Securities said in a stock exchange filing on March
4. "Any appeal submitted after the appeal timeframe will not be
considered by Bursa Securities," it said.
The Edge Financial Daily says Bursa had previously granted two
six-month extensions to APFT to submit its regularisation plan,
first from Jan. 19, 2019 to July 18, 2019, and then to Jan. 18 this
year.
About APFT Berhad
APFT Berhad owns and operates flight education and training
academy, the Asia Pacific Flight Training Academy (APFTA), located
at Sultan Ismail Petra Airport, Pengkalan Chepa, Kota Bharu
Kelantan. APFTA is a flight education and training service provider
in Malaysia. The Company operates through two segments: flight
education and training, and mechanical works and services. It has a
fleet strength of over 30 aircrafts, and over 40 flight and ground
instructors operating out of three commercial airports in
Malaysia.
APFT was admitted into Practice Note 17 (PN17) category in January
2018 as its shareholders' equity fell below the 50% threshold.
In September 2019, APFT’s external auditors expressed doubts over
the flight training company's ability to continue as a going
concern, as its current liabilities exceeded its current assets.
COMINTEL CORP: Deadline to Submit Plan Extended Until July 24
-------------------------------------------------------------
Ahmad Naqib Idris at theedgemarkets.com reports that Bursa Malaysia
Securities Bhd has granted Practice Note 17 (PN17) issuer Comintel
Corp Bhd an extension of time up to July 24 to submit a
regularisation plan.
theedgemarkets.com relates that while an extension has been
granted, the bourse said that it has the right to suspend the
trading of Comintel's shares and delist the company in the event
the company fails to submit a regularisation plan to the regulatory
authorities by July 24.
According to the report, the company may also be delisted if it
fails to obtain the approval from any of the regulatory authorities
necessary for the implementation of its regularisation plan or if
the company fails to implement its plan within the time frame
stipulated by any of the regulatory authorities.
Comintel Corporation Bhd, an investment holding company, engages in
manufacturing, and system integration and maintenance businesses in
Malaysia and internationally.
In January 2018, Comintel Corp Bhd slipped into the Practice Note
17 (PN 17) status after it underwent a major disposal exercise
which left it without a business.
=====================
N E W Z E A L A N D
=====================
GLIDE OMARAMA: Owner Blames Ill-Suited Regulations for Insolvency
-----------------------------------------------------------------
Radio New Zealand reports that the owner of the country's only
commercial glider flight operator is calling for better regulations
as his business goes into insolvency, after being ordered to
suspend operations.
RNZ relates that Glide Omarama was told to stop flights by the
Civil Aviation Authority on March 6, saying it needs to re-certify
from being a recreational aviation organisation, to an adventure
aviation operation.
All instructors and pilots would also need to be re-licensed, the
report says.
According to the report, a CAA spokesperson said Glide Omarama had
been offering paid flights described as trial flights, but the
authority views these as adventure flights -- and initially told
the company last year.
But Glide Omarama owner Gavin Wills said countries like Australia,
the United Kingdom and the United States, don't have such
requirements for commercial gliders, RNZ relays.
He said the cost of re-certification could cost up to NZD100,000,
meaning it was unrealistic for a small operator such as Glide
Omarama.
"It's a huge shock to the gliding community, but not just in New
Zealand, the letters of support pouring in from around the world at
the moment are extraordinary. And I hadn't realised just how many
people were touched and so many different places," the report
quotes Mr. Wills as saying.
RNZ relates that Mr. Wills said cancellations and refunds mean the
company can't operate anymore, and 21 jobs will be lost.
The CAA said the certification -- which comes under Part 115 of the
Civil Aviation Rules -- is in place to keep the public and tourists
safe.
"This rule was first introduced in November 2011 to regulate the
adventure aviation industry, and require operators to be
certificated in much the same way as air transport operators," it
said, RNZ relays.
But Mr. Wills said gliders shouldn't be treated like other air
transport operators, as they are not aircraft with engines, RNZ
relates.
He said Glide Omarama has been calling on regulations specific for
gliders for a number of years, but the request appears to have
fallen on deaf ears.
"We have been non-compliant because you [the CAA] haven't been able
to come up with a certification system that fits gliding."
RNZ adds that Mr. Wills said the company already follows most of
the requirements, and the only new thing it would have to do is
random drug testing.
But at the end of the day, it cannot afford to apply for a
re-certification and he said the 22-year business will be no more.
He also compared Glide Omarama's situation to paragliders, where
the industry body can issue certificates.
"They should be allowed to issue certificates [from the industry
association Gliding New Zealand], in the same way that commercial
paraglider pilots, hang glider pilots and commercial parachuters
are all allowed to operate on the commercial certificate issued by
their industry association."
SLINKSKINS LIMITED: Goes Into Receivership; 20 Jobs Axed
--------------------------------------------------------
Stuff.co.nz reports that a Southland business, founded by All Black
prop forward Jack Hazlett in the late 1960s, has gone into
receivership and will be shut down, leaving about 20 employees out
of a job.
The tannery business - Slinkskins Limited at Thornbury near
Riverton - was put into receivership this month, the report
discloses.
The business, which has remained in the Hazlett family over the
decades, began in the late 1960s and the tannery was opened in the
early 1980s.
According to the report, receiver Brendon Gibson said Slinkskins
Limited would be wound down in coming weeks and the assets sold.
Its business model was taking dead lambs and calves and processing
the skins and sending them to Asia to be processed before they
ended up in high fashion garments, he said, the report relays.
In 2017, Stuff reported that global demand for leather had fallen
off, meaning New Zealand calf skins were less likely to become high
fashion items.
Prices on international markets had fallen, also affecting
lambskins used for gloves and clothing, the report says.
Mr. Gibson, on March 10, said Slinkskins Limited owed money to
"some creditors" and a bank, with the first receiver's report to be
made public in April, Stuff reports.
Stuff says the business would cease to trade in the next two to
three weeks and the receivers would be selling the land, buildings,
plant and equipment.
Some of the 20 staff were finishing this week and the remainder
would finish in the next two to three weeks, Mr. Gibson, as cited
by Stuff, said.
However, other employers in the Riverton area had contacted
Slinkskins Limited to say they may have jobs available for the
workers, he said.
=====================
S O U T H K O R E A
=====================
KOREAN AIR: President Says Coronavirus a Threat to Its Survival
---------------------------------------------------------------
Reuters reports that Korean Air Lines has warned that the
coronavirus outbreak could threaten its survival after more than
half of the world restricted passengers entering from South Korea.
According to Reuters, Woo Kee-hong, Korean Air's president, said
more than 80 per cent of South Korea's biggest carrier's
international capacity had been cut as a result of travel
restrictions globally, compared with a 18 per cent cut made during
the 1997-1998 Asian financial crisis.
"We can easily imagine the severity of the crisis we are facing in
comparison. And what is more daunting is that the situation can get
worse at any time and we cannot even predict how long it will
last," Mr. Woo said in a memo to employees dated on March 9,
Reuters relays.
Reuters relates that Mr. Woo said Korean Air had grounded about 100
of 145 its passenger aircraft, adding that its self-help measures
so far included deferring investments, cutting down on operational
expenses and encouraging employees to take voluntary leave.
"But if the situation continues for a longer period, we may reach
the threshold where we cannot guarantee the company's survival," he
said in the memo, which was seen by Reuters.
Reuters says Japan joined a number of countries to impose curbs on
travelers from South Korea on March 5, adding to the woes of Korean
airlines, which have been among the hit hardest by flight
cancellations worldwide.
The Korea Centers for Disease Control and Prevention on March 9
reported 165 new coronavirus cases, bringing the national tally to
7,478 in one of the most severely affected countries outside
mainland China, Reuters discloses.
*********
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-
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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.
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