/raid1/www/Hosts/bankrupt/TCRAP

/raid1/www/Hosts/bankrupt/TCRAP_Public/200325.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 25, 2020, Vol. 23, No. 61 Headlines A U S T R A L I A HSS SECURITY: Ex-Director Banned Due to Failure of Two Companies NB CONTRACTING: First Creditors' Meeting Set for April 2 P3 SPORTS: Second Creditors' Meeting Set for April 1 VIRGIN AUSTRALIA: Moody's Cuts CFR to B3; Puts Ratings Under Review C H I N A GUORUI PROPERTIES: Fitch Alters Outlook on 'B-' LT IDR to Negative I N D I A 134 INFRA: Ind-Ra Migrates BB+ LT Issuer Rating to Non-Cooperating ADITYA CONSTRUCTIONS: ICRA Keeps B Debt Rating in Non-Cooperating ALTICO CAPITAL: Lenders Accept Offer by SSG Capital ANANDALOK HOSPITAL: ICRA Keeps 'D' Ratings in Not Cooperating BARDHAMAN AGRO: ICRA Lowers Rating on INR6cr Term Loan to B+ BONTON SOFTWARES: Ind-Ra Assigns BB- Issuer Rating, Outlook Stable BRIOTA PAPER: ICRA Reaffirms B+ Rating on INR6.64cr Term Loan C.G. ISPAT: ICRA Maintains 'B+' Debt Rating in Not Cooperating ENVIRO GREEN: ICRA Keeps B+ on INR7cr Loans in Not Cooperating FEDORA SEA: ICRA Keeps B+ on INR10cr Loan in Not Cooperating FIREPRO SYSTEMS: ICRA Lowers Rating on INR30cr Loan to 'C' GAJANAN INDUSTIES: Ind-Ra Keeps B Issuer Rating in Non-Cooperating GANESH SPONGE: Ind-Ra Maintains D Issuer Rating in Non-Cooperating GOVINDAM PRIME: ICRA Lowers Rating on INR10.50cr Loan to B+ HABIB TEXTILES: ICRA Keeps B+ on INR10cr Loans in Not Cooperating JAI MAHARASHTRA: ICRA Reaffirms 'D' Rating on INR78cr Debentures JOYMAKALI COLD: ICRA Keeps B on INR5.62cr Loan in Not Cooperating K. VENKATA RAJU: ICRA Withdraws B+ Rating on INR25cr LT Loan LB COTTON: ICRA Keeps D on INR10cr Loans in Not Cooperating LOK ENTERPRISES: ICRA Keeps 'D' on INR11cr Loans in Not Cooperating MDA MINERAL: ICRA Keeps C+ Debt Ratings in Not Cooperating MEGHRAJ IMPEX: Ind-Ra Migrates B+ Issuer Rating to Non-Cooperating N.D. PLASTICS: Ind-Ra Migrates B Issuer Rating to Non-Cooperating NARAYANADRI HOSPITALS: Ind-Ra Raises LT Issuer Rating to 'B-' RANA SUGARS: ICRA Maintains 'D' Debt Ratings in Not Cooperating S.S. COTTON INDUSTRIES: ICRA Keeps B+ Debt Rating in NonCooperating SLN CNC TECH: ICRA Lowers Rating on INR4.50cr Loan to 'C' SRI JANARDHAN: ICRA Lowers Rating on INR9cr Loan to 'B+' SRI LAKSHMI: ICRA Lowers Rating on INR9.50cr Loan to B+ SUAVE CORP: ICRA Keeps B on INR10cr Loan in Not Cooperating TEKZA CERAMIC: ICRA Assigns B+ Rating to INR7cr Term Loan THIRU MARGADARSHI: ICRA Cuts Ratings on INR10cr Loans to B+ TRISTAR INTERCONTINENTAL: ICRA Cuts Rating on INR4cr Loan to D VIJAY SABRE: ICRA Keeps C on INR10.9cr Loan in Not Cooperating WELCOME FOOTWEARS: Ind-Ra Maintains BB+ Rating in Non-Cooperating YES BANK: To Consider Fundraising Plan on March 26 J A P A N JAPAN POST: Unit Proposes to Cut 10,000 Jobs Amid Falling Revenue M A L A Y S I A PRESS METAL: S&P Alters Outlook to Negative & Affirms 'B+' ICR SCOMI ENERGY: Unit Defaults on MYR80.41MM Loan Payment N E W Z E A L A N D DOWSONS SHOES: To Shut Stores in South Island After 82 Years P A K I S T A N PAKISTAN WATER: Fitch Assigns 'B-' LongTerm IDR, Outlook Stable S I N G A P O R E EAGLE HOSPITALITY: Gets Notice of Default on US$341 Million Loan GEO ENERGY: Moody's Cuts CFR to Caa3, Outlook Remains Negative - - - - - ================= A U S T R A L I A ================= HSS SECURITY: Ex-Director Banned Due to Failure of Two Companies ---------------------------------------------------------------- The Australia Securities and Investments Commission (ASIC) has disqualified Damien John Harvie of Ormeau Hills, Queensland, from managing corporations for four years following his involvement in the failure of two companies. Mr. Harvie was the sole director of two companies placed into liquidation: - HSS Security Pty Ltd A.C.N. 163 883 761; and - Synergy Integration Pty Ltd A.C.N. 600 586 632. In making an order to disqualify Mr. Harvie, ASIC found that he: - failed to maintain proper company records; - continued to allow Synergy Integration Pty Ltd to trade while it was insolvent; and - misused the corporate form when he transferred the business to another company, leaving insufficient assets to pay creditors. At the time of the appointment of the liquidators, the companies had a combined total debt exceeding AUD1.1 million owed to creditors. In making the order to disqualify Mr. Harvie, ASIC relied on the supplementary reports lodged by Mr. Steven Staatz and Mr. Nick Combis, liquidators of HSS Security Pty Ltd and Mr. Philip Newman and Mr. David Quin, liquidators of Synergy Integration Pty Ltd. The liquidators received funding from the Assetless Administration Fund. Mr. Harvie's disqualification took effect from 27 February 2020. Section 206F of the Corporations Act allows ASIC to disqualify a person from managing corporations for up to five years if, within a seven-year period, the person was an officer of two or more companies, those companies were wound up, and a liquidator provides a report to ASIC about the company's inability to pay its debts. ASIC also maintains a public register of banned and disqualified persons that provides information about people who have been: - disqualified from involvement in the management of a corporation; - disqualified from auditing self-managed superannuation funds (SMSFs); or - banned from practising in the financial services of credit industry. ASIC is a member of the Phoenix Taskforce, which comprises federal, state and territory government agencies who collaborate to combat illegal phoenix activity. The aim of the Phoenix Taskforce is to provide a whole-of-government approach to identify, disrupt and prosecute those who engage in or facilitate illegal phoenix activity. NB CONTRACTING: First Creditors' Meeting Set for April 2 -------------------------------------------------------- A first meeting of the creditors in the proceedings of NB Contracting Pty Ltd, formerly Trading as Hotondo Homes Sorell, will be held on April 2, 2020, at 11:00 a.m. via Electronic Facilities. Shelley-Maree Brooks -- sbrooks@rodgersreidy.com.au -- of Rodgers Reidy Tas Pty Ltd was appointed as administrator of NB Contracting on March 23, 2020. P3 SPORTS: Second Creditors' Meeting Set for April 1 ---------------------------------------------------- A second meeting of creditors in the proceedings of P3 Sports & Recovery (Casey) Pty Ltd has been set for April 1, 2020, at 10:30 a.m. at the offices of Worrells Solvency & Forensic Accountants, Level 15, at 114 William Street, in Melbourne, Victoria. The purpose of the meeting is (1) to receive the report by the Administrator about the business, property, affairs and financial circumstances of the Company; and (2) for the creditors of the Company to resolve whether the Company will execute a deed of company arrangement, the administration should end, or the Company be wound up. Creditors wishing to attend are advised proofs and proxies should be submitted to the Administrator by March 31, 2020, at 5:00 p.m. Matthew Kucianski of Worrells Solvency & Forensic Accountants was appointed as administrator of P3 Sports on March 3, 2020. VIRGIN AUSTRALIA: Moody's Cuts CFR to B3; Puts Ratings Under Review ------------------------------------------------------------------- Moody's Investors Service has downgraded Virgin Australia Holdings Limited's Corporate Family Rating to B3 from B2. Concurrently, Moody's has downgraded Virgin's senior unsecured and backed senior unsecured ratings to Caa1 from B3, and its backed senior unsecured MTN program to (P)Caa1 from (P)B3. Moody's has also placed all ratings on review for further downgrade. The outlook is changed to ratings under review from stable. RATINGS RATIONALE The rapid and widening spread of the coronavirus outbreak, deteriorating global economic outlook, falling oil prices, and asset price declines are creating a severe and extensive credit shock across many sectors, regions and markets. The combined credit effects of these developments are unprecedented. The passenger airline sector has been one of the sectors most significantly affected by the shock given its exposure to travel restrictions and sensitivity to consumer demand and sentiment. The action reflects the impact on Virgin of the breadth and severity of the shock, and the broad deterioration in credit quality it has triggered. The rating action was prompted by the very sharp decline in passenger traffic since the outbreak of coronavirus started January 2020, which will result in a significant negative free cash flow, a weakening liquidity profile and significantly higher leverage in the fiscal year ending 30 June 2020. Moody's base case assumption is that the coronavirus pandemic will lead to a period of severely reduced passenger traffic over at least the next three months, with partial or full flight cancellations and aircraft groundings globally. Moody's base case assumes a gradual recovery in passenger volumes from the third quarter. However, there are high risks of more challenging downside scenarios, and the severity and duration of the pandemic and travel restrictions is uncertain. Moody's analysis assumes a more than 60% reduction in Virgin's passenger traffic in the second quarter of calendar 2020, whilst also modelling significantly deeper downside cases. Following the announcement by the Australian government on March 15 that all travelers to Australia, regardless of nationality, will be required to self-isolate for 14 days, Virgin will suspend all international flights from March 30 until June 14 and reduce group domestic capacity by 50% over the same period. The sharp decline in demand has come at a time when Virgin has minimal headroom under its current rating. Moody's expects the issuer's debt/EBITDA to exceed 7x at the end of fiscal 2020, which is above the downgrade trigger of 6x that had been set for its rating. Virgin is currently reducing costs as much as possible to manage its way through this very volatile market environment and mitigate some of the negative credit effect. The company is working with staff and the unions and has requested staff to utilize annual leave or consider unpaid leave. Redundancies will be a last resort. LIQUIDITY Virgin has approximately AUD900 million of cash on its balance sheet and minimal availability under its credit facilities. While the airline has no new aircraft deliveries until July 2021, and no significant debt maturities until October 2021, significantly lower bookings as it cuts capacity will lead to material cash burn in the short term. The pace and quantum of Virgin's cost reductions will be a critical factor in reducing the cash burn and ensuring it has the liquidity to meet its obligations. ENVIRONMENTAL, SOCIAL AND GOVERNANCE CONSIDERATIONS Moody's regards the coronavirus outbreak as a social risk under its ESG framework, given the substantial implications for public health and safety. Virgin is listed on the Australian Securities Exchange but around 90% of the company is owned by five key shareholders: Etihad Airways (20.94% stake), Singapore Airlines (20.09%), Nanshan Group (19.98%), HNA Group (19.82%) and Virgin Group (10.42%). Half of Virgin's board is comprised of independent directors, with the other half comprised of the CEO and directors appointed by its five key shareholders. WHAT COULD CHANGE THE RATING Moody's review will focus on (1) the spread of the virus within Australia, as Virgin is largely a domestic airline, (2) the evolving market situation, including passenger traffic conditions and any further steps taken by the Australian government to manage the spread of the virus, (3) the airline's ability to reduce costs, including staff costs to reduce the cash burn, and (4) any significant government support for the airline sector that would improve Virgin's liquidity. Moody's could downgrade the rating if there is a further reduction in domestic passenger volumes beyond Moody's current expectation, prompted by passenger fear, widespread infections, or domestic flight bans. Moody's could also downgrade the rating if cash is depleted due to the inability to remove costs and cut capital spending in a timely manner. The outlook could be returned to stable if Virgin manages to reduce costs and capital spending to a level where its liquidity can be maintained above AUD700 million, along with a stabilizing domestic industry and recovering passenger demand. PRINCIPAL METHODOLOGY The principal methodology used in these ratings was Passenger Airline Industry published in April 2018. COMPANY PROFILE Virgin Australia Holdings Limited, headquartered in Brisbane, is Australia's second largest airline following its launch in 2000 and listing on the Australian Securities Exchange in 2003. As of fiscal 2019, it had generated revenues of AUD5.8 billion and carried around 24.8 million passengers. ========= C H I N A ========= GUORUI PROPERTIES: Fitch Alters Outlook on 'B-' LT IDR to Negative ------------------------------------------------------------------ Fitch Ratings has revised the rating Outlook on China-based Guorui Properties Limited to Negative from Stable, and affirmed the Long-Term Foreign-Currency Issuer Default Rating at 'B-'. The senior unsecured rating and the ratings on its outstanding notes are also affirmed at 'B-', with Recovery Rating of 'RR4'. The revision in the Outlook reflects Guorui's sustained weak liquidity position, and the likelihood of the company having difficulties meeting its obligations later this year as its USD455 million senior notes due February 2022 become puttable in February 2021. Guorui's ratings are supported by a quality land bank that is large enough to support sustained development in the next nine to 10 years, and a moderate leverage of 50%-55%. KEY RATING DRIVERS Weak Liquidity Position: Guorui's ratings are mainly constrained by its track record of opportunistic cash management, with cash to short-term debt ratio maintained at below 25% over the past three years. Although improved from 7.5% at end-2018, Fitch estimates that this ratio remained low at around 20% at end-2019, which is weak compared to peers in the 'B' rating category. Fitch believes that repayment pressure is likely to intensify in the latter half of this year as the USD455 million senior notes due February 2022 become puttable in February 2021. Guorui appears to have options to address this, as it has significant unpledged assets of more than CNY25 billion at end-June 2019, mostly consisting of properties under development and completed properties, which may be used to secure onshore bank loans. However, the low cash levels leave little liquidity headroom and expose the company to potential changes in credit conditions. ESG - Governance: Guorui has an ESG Relevance Score of 5 for Governance Structure - a level indicating that the company's rating is affected by this environmental, social and governance sub-factor - given its weak liquidity management. Fitch believes the management needs to establish a clearer and longer track record in consistently improving liquidity conditions before the rating constraint is removed. Quality Land Bank: Fitch believes Guorui's quality land bank is supportive of its current attributable sales scale of around CNY11 billion. Guorui had 14.2 million sqm of total land bank, or above 9 million sqm on an attributable basis at end-June 2019, which can sustain 9-10 years of development. This means that Guorui has room to reduce leverage as it is not under immediate pressure to replenish its land bank. The majority of Guorui's land bank is located in Tier 1-2 cities or Tier 3 cities benefitting from spill-over from core cities, where demand remains robust. The average cost of Guorui's land bank was less than 20% of its average selling price, as most of the land was acquired years ago, and the company enjoys lower land cost through participation in primary land development. Fitch expects Guorui to continue enjoying a healthy EBITDA margin of around 30% (2018: 33.6%) in 2019-2020, thanks to the low land cost. Moderate Leverage: Fitch estimates that leverage, measured by net debt/adjusted inventory, dropped to around 53% in 2019 from 56.9% in 2018 following slower land acquisitions and improved cash collection. Guorui acquired only one land parcel in 2019, which accounted for less than 1% sales value. This was in contrast to 2015-2017, when it spent 60%-80% of sales on land annually. Cash collection improved in 2019, due to larger sales contribution from Beijing and Suzhou, where sales proceeds were collected in the same year, and cash collected from sales made in 2017-2018. Fitch expects a stable leverage of 50%-55% in the next one to three years, assuming the company spends 75%-85% of its sales proceeds on construction, interest and tax expenses, and potential land replenishment in the higher-tier cities. Stable Investment Properties: Fitch expects Guorui to enjoy stable rental income from its quality investment-property portfolio and its recurring EBITDA / gross interest coverage to stay at around 0.2x in the next few years. Guorui had eight completed investment properties with total gross floor area of roughly 0.5 million sq m valued at CNY20 billion at end-June 2019. The portfolio consists mainly of shopping malls and offices in Beijing and Tier 2-3 cities like Foshan and Haikou. About 55% of the portfolio by total leasable area is within the second ring road of Beijing and these contributed more 85% of rental income. Fitch estimates that rental income grew by more than 20% in 2019, mainly due to the ramp-up of Beijing Hademen Center, which started operation in 2017. DERIVATION SUMMARY Guorui's ratings are supported by its quality land bank, which is enough for 9-10 years of development, longer than peers in the 'B' rating category, which have land bank life of three to five years. Its cheap land cost supports good profitability of above 30%, a level better than that of peers such as Modern Land (China) Co., Limited (B/Stable). Guorui's leverage of 50%-55% falls in the mid-range for 'B' category peers, and is comparable with that of Beijing Hongkun Weiye Real Estate Development Co., Ltd. (B/Negative) in its forecast. Guorui also enjoys stable rental income from its quality investment properties, which generate above CNY600 million of rental income annually. The recurring EBITDA to interest coverage of 0.2x is larger than that of most peers in the 'B' rating category. However, Guorui's ratings are constrained by its poor liquidity, which is weak compared to 'B' category peers, which typically have cash-to-short-term debt ratios above 50%. Hongkun is the most comparable peer for Guorui. Both have similar sales of above CNY11 billion and regional focus in the Bohai area. Hongkun is more geographically concentrated in the Bohai area, which accounted for around 80% of its land bank. Hongkun's land bank life is also shorter at 3-4 years than Guorui's 9-10 years. Guorui's investment-property assets are better than Hongkun's, which are valued at CNY8 billion and generate annual income of CNY200 million. However, Guorui is subject to higher liquidity risk due to its opportunistic liquidity management, with its cash-to-short-term debt ratio sustained at around 20%, lower than Hongkun's 50% and above. As a result, Guorui is rated one notch lower than Hongkun. KEY ASSUMPTIONS Fitch's Key Assumptions Within Its Rating Case for the Issuer - Attributable contracted sales broadly in line with 2019 sales of CNY11.3 billion, with cash collection rate at 85%-90% in 2020-2021 - 10%-30% of contracted sales proceeds to be spent on land acquisitions in 2020-2021 - EBITDA margin, excluding capitalized interest from cost of sales, at around 25%-30% in 2020-2021 (2019E: 31%; 2018: 34%) - Rental income from investment properties at CNY670 million- 770 million in 2020-2021 RATING SENSITIVITIES Developments That May, Individually or Collectively, Lead to Revision in the Outlook to Stable - Increased cash balance and improved debt maturity profile on a sustained basis Developments That May, Individually or Collectively, Lead to Negative Rating Action - Inability to address short-term debt, in particular USD455 million of bonds that turn puttable in February 2021 - No meaningful improvement in liquidity position - Leverage sustained above 65% LIQUIDITY AND DEBT STRUCTURE Tight Liquidity: Guorui's unrestricted cash on hand and unutilised bank facilities at end-2019 were not sufficient to cover its short-term debt in Fitch's estimate. Guorui's cash to short-term debt ratio was 22% at end-1H19 and 7.5% at end-2018. Access to Onshore Funding: Guorui said it is planning to meet its offshore obligations mainly using onshore funding, but would also look for offshore funding options. Fitch believes Guorui's large unencumbered assets could provide the company sufficient room for refinancing. Guorui also has CNY2 billion in unused onshore bond issuance quota and is seeking opportunities in the markets. The company has access to onshore bank borrowing and obtained CNY5.6 billion in new bank facilities with tenor ranging from 2 to 15 years and interest rates of 4.9%-8% so far in 2020, which should cover most of its refinancing needs in 1H20. Guorui had USD230 million of unused offshore bond quota at end-2019. ESG CONSIDERATIONS Guorui has an ESG Relevance Score of 5 for Governance Structure, which reflects weak liquidity management. Except for the matters discussed above, the highest level of ESG credit relevance, if present, is a score of 3 - ESG issues are credit neutral or have only a minimal credit impact on the entity, either due to their nature or the way in which they are being managed by the entity. ========= I N D I A ========= 134 INFRA: Ind-Ra Migrates BB+ LT Issuer Rating to Non-Cooperating ------------------------------------------------------------------ India Ratings and Research (Ind-Ra) has migrated 134 Infra LLP's Long-Term Issuer Rating to the non-cooperating category. The issuer did not participate in the rating exercise despite continuous requests and follow-ups by the agency. Therefore, investors and other users are advised to take appropriate caution while using the ratings. The rating will now appear as 'IND BB+ (ISSUER NOT COOPERATING)' on the agency's website. The instrument-wise rating action is: -- INR1,210.0 bil. Term loan due on October 2022 migrated to non- cooperating category with IND BB+ (ISSUER NOT COOPERATING) rating. Note: ISSUER NOT COOPERATING: The ratings were last reviewed on April 4, 2019. Ind-Ra is unable to provide an update, as the agency does not have adequate information to review the ratings. COMPANY PROFILE 134 Infra was converted into a limited liability partnership from a partnership firm on December 15, 2017. The 14-partner firm is engaged in the construction of residential and commercial real estate projects in Surat, Gujarat. ADITYA CONSTRUCTIONS: ICRA Keeps B Debt Rating in Non-Cooperating ----------------------------------------------------------------- ICRA said the ratings for the INR10.00-crore bank facilities of Aditya Constructions (AC) Continues to remain under 'Issuer Not Cooperating' category'. The ratings are denoted as "[ICRA]B(Stable)/A42 ISSUER NOT COOPERATING". Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long Term/ 10.00 [ICRA]B(Stable)/A4; ISSUER NOT Short term– COOPERATING; Rating Continues Unallocated to remain under issuer not cooperating category ICRA has been trying to seek information from the entity so as to monitor its performance, but despite repeated requests by ICRA, the entity's management has remained non-cooperative. The current rating action has been taken by ICRA basis best available information on the issuers' performance. Accordingly, the lenders, investors and other market participants are advised to exercise appropriate caution while using this rating as the rating may not adequately reflect the credit risk profile of the entity. Aditya Constructions was established in 2012 as a proprietorship concern and is engaged in trading of Steel, Granite processing and trading and execution of minor construction projects under the capacity of subcontractor. Mr. Ramesh Reddy is the Proprietor of the firm. Mr. Reddy is a B.Tech graduate and has prior experience of 15 years in the same field. ALTICO CAPITAL: Lenders Accept Offer by SSG Capital --------------------------------------------------- BloombergQuint reports that stressed real estate lending firm Altico Capital Ltd. is set to get resolved as the lending consortium has accepted an offer by Hong Kong-based stressed asset investor SSG Capital. Lenders led by State Bank of India have accepted an offer in which SSG Capital will offer INR2,754 crore upfront and pay the rest of the settlement over time through security receipts, SBI Capital Markets said in a statement, BloombergQuint relates. According to BloombergQuint, the offer would result in an 80 percent recovery for lenders, the statement said while not specifying the amount to be paid over time. SBI Capital Markets had advised lenders through the resolution process. In September 2019, Altico Capital had failed to repay interest to Mashreq Bank on external commercial borrowings. Following this, the company's financial position deteriorated rapidly, which led to lenders finding a resolution plan for the company. In the interim, Altico Capital also lost two chief executive officers in rapid succession. Cerberus Capital Management and the promoters of Altico Capital - including Varde Partners, Clearwater Capital and Abu Dhabi Investment Council - had also submitted plans, BloombergQuint had reported on Feb. 17. About Altico Capital Altico was established in 2004 by the funds managed by Clearwater Capital Partners as Clearwater Capital Partners India Private Limited for wholesale lending to capital-constrained Indian small and medium enterprises. It was registered as a non-deposit-accepting non-banking finance company with the Reserve Bank of India in January 2005. Its business strategy initially focused on special situation opportunities across the capital structure. In FY15, the company was renamed Altico Capital India Limited, and its business strategy was changed. Altico is focused on high-yield asset-backed senior secured credit opportunities in the real estate sector. ANANDALOK HOSPITAL: ICRA Keeps 'D' Ratings in Not Cooperating ------------------------------------------------------------- ICRA said the ratings for the INR12.50 crore bank facilities of Anandalok Hospital (AH) continues to remain under the 'Issuer Not Cooperating' category. The rating is denoted as "[ICRA]D ISSUER NOT COOPERATING". Amount Facilities (INR crore) Ratings ---------- ----------- ------- Fund based- 5.10 [ICRA]D ISSUER NOT COOPERATING; Term Loan Rating continues to remain under the 'Issuer Not Cooperating' category Fund Based– 7.00 [ICRA]D ISSUER NOT COOPERATING; Cash Credit Rating continues to remain under the 'Issuer Not Cooperating' category Non Fund Based– 0.40 [ICRA]D ISSUER NOT COOPERATING; Letter of Rating continues to remain Guarantee under the 'Issuer Not Cooperating' category ICRA has been trying to seek information from the entity so as to monitor its performance, but despite repeated requests by ICRA, the entity's management has remained non-cooperative. The current rating action has been taken by ICRA basis best available/dated/ limited information on the issuers' performance. Accordingly, the lenders, investors and other market participants are advised to exercise appropriate caution while using this rating as the rating may not adequately reflect the credit risk profile of the entity. Established in 1989, Anandalok Hospital is a charitable society established for offering medical treatment at affordable rates to the economically weaker sections of the society. It runs six hospitals, four of them in Kolkata, and one each at Baduria and Raniganj, with a total capacity of 450 beds and a diagnostic centre in Kolkata. All the hospitals are multispecialty in nature. The society also undertakes other charitable activities. It distributes books to poor students, provides food,clothes and shelter to the poor people. Mr. Deo Kumar Saraf, a businessman, is the chairman of the society and has been associated with it since its formation. Mr. Arun Poddar, Ms. Jyotsna Poddar, Mr. R.P. Salarpuria, Mr. S.K. Roy, Mr. B.L. Jajodia, Mrs. Jayshree Mohta, Mr. Pawan Kumar Dhoot, Mr. Ashok Todi, and Mr. Lalit Beriwal, are some of the other members on the society's managing committee. BARDHAMAN AGRO: ICRA Lowers Rating on INR6cr Term Loan to B+ ------------------------------------------------------------ ICRA has revised the ratings on certain bank facilities of Bardhaman Agro Products (I) Pvt. Ltd., as: Amount Facilities (INR crore) Ratings ---------- ----------- ------- Fund Based 6.00 [ICRA]B+ (Stable) ISSUER NOT Limit–Term COOPERATING; Rating downgraded Loan from [ICRA]BB- (Stable) and Rating continues to remain under the 'Issuer Not Cooperating' category Non Fund 0.20 [ICRA]A4 ISSUER NOT Based Limit– COOPERATING; Rating continues Bank Guarantee to remain under the 'Issuer Not Cooperating' category Rationale The rating downgrade is because of lack of adequate information regarding Bardhaman Agro Products (I) Pvt. Ltd.'s performance and hence the uncertainty around its credit risk. ICRA assesses whether the information available about the entity is commensurate with its rating and reviews the same as per its "Policy in respect of non-cooperation by the rated entity". The lenders, investors and other market participants are thus advised to exercise appropriate caution while using this rating as the rating may not adequately reflect the credit risk profile of the entity, despite the downgrade. As part of its process and in accordance with its rating agreement with Bardhaman Agro Products (I) Pvt. Ltd., ICRA has been trying to seek information from the entity so as to monitor its performance, but despite repeated requests by ICRA, the entity's management has remained non-cooperative. In the absence of requisite information and in line with SEBI's Circular No. SEBI/HO/MIRSD4/CIR/2016/119, dated November 1, 2016, ICRA's Rating Committee has taken a rating view based on the best available information. Established in 2009 as a private limited company, BAPPL has been promoted by Mr. Sekh Rabiul Haque and Mr. Samir Kanti Sikdar. The company is engaged in the milling of govind bhog rice and has an installed milling capacity of 96 metric tonnes per day (MTPD), or 28,800 metric tonnes per annum (MTPA). The rice mill is located in the Burdwan district of West Bengal. BONTON SOFTWARES: Ind-Ra Assigns BB- Issuer Rating, Outlook Stable ------------------------------------------------------------------ India Ratings and Research (Ind-Ra) has assigned Bonton Softwares Private Limited (BSPL) a Long-Term Issuer Rating of 'IND BB-'. The Outlook is Stable. The instrument-wise rating actions are: -- INR90 mil. Fund-based working capital limit assigned with IND BB-/Stable/IND A4+ rating; -- INR147 mil. Non-fund-based limits assigned with IND A4+ rating; and -- INR30 mil. Term loan due on FY23 assigned with IND BB-/Stable rating. KEY RATING DRIVERS The ratings reflect BSPL's small scale of operations, as evident from the revenue of INR102.91 million in FY19. The company started its operations from January 2019. Ind-Ra expects the revenue to improve significantly in FY20, as it would be the first full year of operations. BSPL had already booked revenue of INR416.805 million as of February 15, 2020. However, the management expects the scale of operation to improve over the near-to-medium term owing to the signing of new contracts. The ratings also reflect BSPL's high customer concentration risk, as the company's only clients are the Transport Commissioner of Tamil Nadu and Tamil Nadu Civil Supplies Corporation. Any breach of terms and conditions of the tender agreement by the company could negatively affect its revenue visibility. Although the ROCE was 6.1% in FY19, the company reported a margin of 51.8% due to the high-margin nature of the business. However, Ind-Ra expects the EBITDA margin to fall in FY20 owing to the likely increase in costs. The ROCE, though, is likely to improve significantly in FY20 on account of an increase in the absolute EBITDA. Liquidity Indicator - Adequate: BSPL's average maximum utilization of fund-based facilities of around 74.44% for 12 months ended January 2020. The cash flow from operations was positive at INR122.24 million in FY19. The free cash flow was negative at INR85.47 million in FY19 as the company undertook CAPEX of around INR207.00 million for setting up the required facilities for executing the projects in hand. 70% of the CAPEX was funded by debt and 30% by infusion of equity capital. The company's fund flow from operations was negative at INR5.98 million in FY19. Ind-Ra expects BSPL's liquidity to be sufficient to meet the repayment obligations over the medium term. The ratings are supported by BSPL's comfortable credit metrics on the back of strong operating profitability. In FY19, the interest coverage (operating EBITDA/gross interest expense) was 28.38x and the net leverage (total adjusted net debt/operating EBITDAR) was 2.10x. Ind-Ra expects the credit metrics to deteriorate in FY20 due to a rise in working capital requirements and increased interest obligations. RATING SENSITIVITIES Negative: A decline in the scale of operations along with deterioration in the credit metrics, with the interest coverage falling below 2.0x, could lead to negative rating action. Positive: A substantial improvement in the scale of operations while maintaining the credit profile could lead to positive rating action. COMPANY PROFILE Bon Ton Software Private Limited was incorporated under the Companies Act, 1956, on 27 March 2007. The company's registered office is located in Chennai, Tamil Nadu. The company is engaged in the business of software installation and maintenance services. BRIOTA PAPER: ICRA Reaffirms B+ Rating on INR6.64cr Term Loan ------------------------------------------------------------- ICRA has reaffirmed ratings on certain bank facilities of Briota Paper LLP's (BPL), as: Amount Facilities (INR crore) Ratings ---------- ----------- ------- Fund-based– Term Loan 6.64 [ICRA]B+ (Stable); Reaffirmed Fund-based– Cash Credit 5.00 [ICRA]B+ (Stable); Reaffirmed Non-fund Based– Bank Guarantee 0.59 [ICRA]A4; Reaffirmed Rationale The reaffirmation in the ratings continues to factor in BPL moderate scale of operations and below-average financial risk profile as evident from the leveraged capital structure, below-average debt coverage indicators and high working capital intensity. The ratings are also constrained by BPL's exposure to high sectoral/geographical concentration risk, with the major share of revenues coming from Morbi-based tile players. The ratings also consider the stiff competition in the kraft paper industry, resulting in intense pricing pressure and the exposure of BPL's profitability to volatility in waste paper prices, fuel (coal) cost and foreign currency exchange. The ratings, however, favorably factor in the experience of BPL's promoters in the paper packaging industry, the location advantage, given the proximity to customer base (ceramic cluster of Morbi), and the scale of operations in the current fiscal. The Stable outlook on the [ICRA]B+ rating reflects ICRA's opinion that Briota Paper LLP will continue to benefit from the experience of its promoters in the paper packaging industry. Key rating drivers and their description Credit strengths Experience of promoters in paper packaging industry – BPL manufactures kraft paper used in producing corrugated boxes. The key promoters, Mr. Nishith Detorja, has experience of more than five years in the paper packaging industry vide his association with another entity operating in the paper packaging business. Location advantage in terms of proximity to end customers – The location of the firm's facility in the ceramic tiles manufacturing hub of Morbi (Gujarat) as well as the established clientele of its associate concern in the paper packaging industry facilitates the firm to increase market penetration of its products. Scale up of operations in FY2020: BPL commenced commercial operations in February 2019. The firm has reported a revenue of INR0.36 crore in its initial year of operation. In 10MFY2020, it achieved a revenue of INR23.59 crore on the back of healthy volume growth and would expect to report a revenue of ~Rs. 28-29 crore in FY2020. Credit challenges Moderate scale of operations; geographic concentration risk – The scale of operations of BPL remains moderate with an operating income of INR23.60 crore in 10MFY2020, as against INR0.36 crore in 2MFY2019. The firm faces high geographical concentration risk as the major revenues are from Morbi-based tile players in Gujarat. Below average financial risk profile – The firm's financial risk profile remains below average, marked by leverage capital structure and below average debt coverage indicators. It has an estimated gearing of 2.39, interest coverage of 2.40 times, and TD/OBDITA of 4.73 times. The firms' working capital intensity remains high (NWC/OI of ~15-20% in FY2020) due to high receivables and high inventory levels. Intense competition – The kraft paper industry is highly fragmented with stiff competition from numerous organised as well as unorganised players. The degree of competition in the lower BF range ( C.G. ISPAT: ICRA Maintains 'B+' Debt Rating in Not Cooperating -------------------------------------------------------------- ICRA said the ratings for the INR65.00 crore bank facilities of C.G. Ispat Private Limited (CGIPL) continues to remain under the 'Issuer Not Cooperating' category. The rating is denoted as "[ICRA]B+ (Stable)/[ICRA]A4 ISSUER NOT COOPERATING". Amount Facilities (INR crore) Ratings ---------- ----------- ------- Fund-based– 28.79 [ICRA]B+ (Stable) ISSUER NOT Term Loan COOPERATING; Rating continues to remain under the 'Issuer Not Cooperating' category Fund-based– 19.00 [ICRA]B+ (Stable) ISSUER NOT Cash Credit COOPERATING; Rating continues to remain under the 'Issuer Not Cooperating' category Non Fund 17.21 [ICRA]A4 ISSUER NOT COOPERATIN; Based Limits Rating continues to remain under the 'Issuer Not Cooperating' category ICRA has been trying to seek information from the entity so as to monitor its performance, but despite repeated requests by ICRA, the entity's management has remained non-cooperative. The current rating action has been taken by ICRA basis best available/dated/ limited information on the issuers' performance. Accordingly, the lenders, investors and other market participants are advised to exercise appropriate caution while using this rating as the rating may not adequately reflect the credit risk profile of the entity. Incorporated in 2004, the company was acquired by the Raipur based Vaswani group in October, 2010. CGIPL is engaged in the manufacturing of MS Beam, Angles Channels and H-Beams, with an installed capacity of around 60,000 MTPA of steel structurals. CGIPL also works as a conversion agent for Steel Authority of India Limited (SAIL). The flagship company of the group, Vaswani Industries Limited (VIL) holds around 40% of the equity shares in CGIPL. The Vaswani group on a consolidated level, has production facilities for sponge iron, billets, steel structurals, power and steel castings with annual capacities of 90,000 MT, 36,000 MT, 60,000 MT, 11.50 MW and 12,000 MT respectively. ENVIRO GREEN: ICRA Keeps B+ on INR7cr Loans in Not Cooperating -------------------------------------------------------------- ICRA said the rating for the INR7.00 crore bank facilities of Enviro Green Alloys Inc. continues to remain under 'Issuer Not Cooperating' category. The rating is denoted as "[ICRA]B+ (Stable) ISSUER NOT COOPERATING". Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long Term-Fund 5.00 [ICRA]B+ (Stable) ISSUER NOT Based/CC COOPERATING; Rating continues to remain under 'Issuer Not Cooperating' category Long Term-Fund 2.00 [ICRA]B+ (Stable) ISSUER NOT Based TL COOPERATING; Rating continues to remain under 'Issuer Not Cooperating' category ICRA has been trying to seek information from the entity so as to monitor its performance, but despite repeated requests by ICRA, the entity's management has remained non-cooperative. The current rating action has been taken by ICRA basis best limited information on the issuers' performance. Accordingly, the lenders, investors and other market participants are advised to exercise appropriate caution while using this rating as the rating may not adequately reflect the credit risk profile of the entity. EGA incorporated in 2011, is involved in manufacturing pure lead, lead alloys and lead oxides through recycling lead scrap arising out of used lead in batteries and sheathing. With an installed capacity of 2,800 MTPA, EGA caters to battery manufacturers in the domestic markets. The company operates in three shifts and employs about 45 employees. FEDORA SEA: ICRA Keeps B+ on INR10cr Loan in Not Cooperating ------------------------------------------------------------ ICRA said the ratings for the INR10.00-crore bank facilities of Fedora Sea Foods Private Limited (FSFPL) Continues to remain under 'Issuer Not Cooperating' category'. The ratings are denoted as "[ICRA]B+(Stable) ISSUER NOT COOPERATING". Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long Term- 10.00 [ICRA]B+(Stable); ISSUER NOT Fund Based- COOPERATING; Rating Continues Term Loan to remain under issuer not cooperating category ICRA has been trying to seek information from the entity so as to monitor its performance, but despite repeated requests by ICRA, the entity's management has remained non-cooperative. The current rating action has been taken by ICRA basis best available information on the issuers' performance. Accordingly, the lenders, investors and other market participants are advised to exercise appropriate caution while using this rating as the rating may not adequately reflect the credit risk profile of the entity. Fedora Sea Foods Private Limited was incorporated in the year 2011 by Mr. K. Narahari Reddy who has decade long experience in the Aqua Farms and Hatchery business. The company is engaged in the production of Vannamei seeds, shrimps and also started prawn feed manufacturing from May 2015 having capacity of 24,000 MTPA used in cultivation of shrimps. The company is in Nellore, which is the aquaculture belt of Andhra Pradesh. FIREPRO SYSTEMS: ICRA Lowers Rating on INR30cr Loan to 'C' ---------------------------------------------------------- ICRA has revised the ratings on certain bank facilities of Firepro Systems Private Limited (FSPL), as: Amount Facilities (INR crore) Ratings ---------- ----------- ------- Unallocated 30.00 Long-term rating downgraded to [ICRA]C from [ICRA]B+(Stable)/ Short-term rating reaffirmed at [ICRA]A4; long-term and short-term ratings withdrawn Rationale The rating revision takes into consideration the stretched liquidity profile of FSPL which is reflected by the continued instances of devolvement of letter of credit (LC) facilities and over-utilisation of working capital limits. However, ICRA notes that the instances of devolvement of LC facilities and over-utilisation of working capital limits have been cured within a period of 7-8 days from the date of occurrence. The operating revenue of the company had grown by 40% in FY2019. However, the revenue growth has been lower than ICRA's earlier expectations. Consequently, the company has not been able to achieve break-even at OPBITDA level in FY2019, which has contributed to the tightening in the liquidity profile. Moreover, the company's cash margin requirements for non-fund based limits has not reduced as per earlier expectations, which has also constrained liquidity profile. The company avails non-fund based limits as well as fundbased working capital limits against 100% cash margin. The rating, however, considers the reputed client profile of FSPL and its track record in the fire protection services segment over the past two decades. The clients of FSPL include reputed real estate developers such as RMZ Corp., Embassy Developers, Bagmane Developers, Kalyani Developers and Salarpuria-Sattva Developers. ICRA has withdrawn the rating of [ICRA]C/[ICRA]A4 on the INR30 crore unallocated borrowing limits of FSPL at the request of the company and as the rating is unutilised. Key rating drivers and their description Credit strengths Reputed client profile and proven industry track record – The clients of FSPL consist of reputed real estate developers, which include RMZ Corp., Embassy Developers, Bagmane Developers, Kalyani Developers and Salarpuria-Sattva Developers. The reputed tenant profile, the long track record of FSPL in the fire protection services segment and the healthy demand for commercial office space in Bangalore are likely to sustain the demand for company's services. Credit challenges Continued devolvement of LC facilities and over-utilisation of working capital limits – There were continued instances of devolvement in the LC facilities and over-utilisation of working capital facilities of FSPL during February and March 2020. However, ICRA notes that the instances of devolvement of LC facilities and over-utilisation of working capital limits have been cured within a period of 7-8 days from the date of occurrence. There were instances of devolvement of the company's LCs outstanding during September and October 2019. The continued instances of devolvement of the LC facilities reflect the stretched liquidity profile of the company. Slower than anticipated scaling-up of business resulting in operating losses – The revenue growth of FSPL has been lower than earlier expectations. Consequently, the company has not been able to achieve OPBITDA break-even in FY2019 which has contributed to the tightening in its liquidity profile. Moreover, the company's cash margin requirements for non-fund based limits has not reduced as per earlier expectations, which has also constrained liquidity profile. Liquidity position: Poor FSPL's liquidity profile is poor, which is reflected by the continued instances of devolvement in the LC facilities and overutilisation of the working capital limits of the company. However, ICRA notes that the instances of devolvement of LC facilities and over-utilisation of working capital limits have been cured within a period of 7-8 days from the date of occurrence. FSPL primarily utilises non-fund based limits towards the procurement of goods and fund-based limits for its working capital requirements. As on March-2019, FSPL had cash and bank balances of close to INR68 crore, the majority of which was used as cash margin for the non- fund based limits and fund-based working capital limits availed (100% cash margin). Going forward, the company will be reliant on scaling-up of business and achieving break-even in operations to improve the liquidity profile. Rating sensitivities Not applicable as the ratings assigned to FSPL have been withdrawn. FSPL, incorporated in 1992, executes turnkey contract projects in the fire safety and security systems segment. The company provides engineered solutions in the commercial, manufacturing, warehousing, logistics and build-to-suit office space market segments. It has a reputed clientele, which consists of companies such as RMZ Corp., Embassy Developers, Bagmane Developers, Kalyani Developers and Salarpuria-Sattva Group. In May 2012, it became a subsidiary of Panasonic Corporation of Japan. Subsequently in March 2018, the founder of the company, Mr. N S Narendra bought out the shareholding of Panasonic completely. GAJANAN INDUSTIES: Ind-Ra Keeps B Issuer Rating in Non-Cooperating ------------------------------------------------------------------ India Ratings and Research (Ind-Ra) has maintained Shree Gajanan Industries' Long-Term Issuer Rating of 'IND B (ISSUER NOT COOPERATING)' in the non-cooperating category and has simultaneously withdrawn it. The instrument-wise rating actions are: -- INR450 mil. Fund-based facilities * maintained in the non- cooperating category and withdrawn; and -- INR50 mil. Non-fund-based facilities # maintained in the non- cooperating category and withdrawn. *Maintained in 'IND B (ISSUER NOT COOPERATING)'/'IND A4 (ISSUER NOT COOPERATING)' before being withdrawn #Maintained in 'IND A4 (ISSUER NOT COOPERATING)' before being withdrawn KEY RATING DRIVERS The ratings have been maintained in the non-cooperating category because Shree Gajanan Industries did not participate in the rating exercise despite continuous requests and follow-ups by Ind-Ra. The agency is no longer required to maintain the rating as the agency has received a no-objection certificate from the rated facility's lender. This is consistent with The Securities and Exchange Board of India's circular dated March 31, 2017, for credit rating agencies. COMPANY PROFILE Established in 1969, Shree Gajanan Industries manufactures various varieties of rice (basmati and non-basmati). It has a 5 tons/hour modern rice mill in Nizamabad. GANESH SPONGE: Ind-Ra Maintains D Issuer Rating in Non-Cooperating ------------------------------------------------------------------ India Ratings and Research (Ind-Ra) has maintained Ganesh Sponge Private Limited's (GSPL) Long-Term Issuer Rating of 'IND D (ISSUER NOT COOPERATING)' in the non-cooperating category and has simultaneously withdrawn it. The instrument-wise rating actions are: -- INR260 mil. Fund-based limits (long-term)* maintained in non- cooperating and withdrawn; and -- INR55.63 mil. Term loan (long-term)* due on March 2020 maintained in non-cooperating and withdrawn. *Maintained in 'IND D (ISSUER NOT COOPERATING)' before withdrawn. KEY RATING DRIVERS GSPL 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 2004, GSPL is a manufacturer of sponge iron. The company is managed by Mr. SK Dalmia. GOVINDAM PRIME: ICRA Lowers Rating on INR10.50cr Loan to B+ ----------------------------------------------------------- ICRA has revised the ratings on certain bank facilities of Shree Govindam Prime Foods Pvt. (SGPF), as: Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long Term/Fund 10.50 [ICRA]B+ (Stable) ISSUER NOT Based/Cash COOPERATING; Rating downgraded Credit from [ICRA]BB(Stable) and continues to remain under 'Issuer Not Cooperating' Category Rationale The ratings downgrade is because of lack of adequate information regarding SGPF performance and hence the uncertainty around its credit risk. ICRA assesses whether the information available about the entity is commensurate with its rating and reviews the same as per its "Policy in respect of non-cooperation by the rated entity". The lenders, investors and other market participants are thus advised to exercise appropriate caution while using this rating as the rating may not adequately reflect the credit risk profile of the entity, despite the downgrade. As part of its process and in accordance with its rating agreement with Shree Govindam Prime Foods Pvt. Ltd, ICRA has been trying to seek information from the entity so as to monitor its performance, but despite repeated requests by ICRA, the entity's management has remained non-cooperative. In the absence of requisite information and in line with SEBI's Circular No. SEBI/HO/MIRSD4/CIR/2016/119, dated November 1, 2016, ICRA's Rating Committee has taken a rating view based on the best available information. SGPF processes wheat grain into wheat flour, white flour (maida), semolina (suji) and bran at its factory at Bikaner, Rajasthan. It sells wheat flour, maida and suji to various traders spread across Rajasthan, Maharashtra and Gujarat. The company also sells maida to various renowned biscuit manufacturing companies, such as ITC Limited's agri division, Priya Gold, Parle. SGPF sells its products under the brand name of "Govindam". Mr. Govind Grover manages the the affairs of the company. The factory premise of the company is spread in an area of 8,850 square meters. HABIB TEXTILES: ICRA Keeps B+ on INR10cr Loans in Not Cooperating ----------------------------------------------------------------- ICRA said the ratings for the INR10.00 crore bank facilities of Habib Textiles Pvt. Ltd. continues to remain under the 'Issuer Not Cooperating' category. The rating is denoted as "[ICRA]B+ (Stable) ISSUER NOT COOPERATING". Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long Term– 10.00 [ICRA]B+ (Stable) ISSUER NOT Fund Based COOPERATING; Rating continues to remain under the 'Issuer Not Cooperating' category ICRA has been trying to seek information from the entity so as to monitor its performance, but despite repeated requests by ICRA, the entity's management has remained non-cooperative. The current rating action has been taken by ICRA basis best available/dated/limited information on the issuers' performance. Accordingly, the lenders, investors and other market participants are advised to exercise appropriate caution while using this rating as the rating may not adequately reflect the credit risk profile of the entity. Habib Textiles Pvt. Ltd., promoted by the Ansari family, was incorporated in 2003. The company manufactures fabric (greige as well as finished) that are mainly used as shirting material. The company procures textured yarn from agents based in Mumbai and undertakes warping, weaving, sizing and cutting works in-house, while dyeing work is outsourced to third parties on job-work basis. Its head office and manufacturing facility are in Bhiwandi, Thane (Maharashtra). The company also has a sales office in Surat (Gujarat). JAI MAHARASHTRA: ICRA Reaffirms 'D' Rating on INR78cr Debentures ---------------------------------------------------------------- ICRA has reaffirmed ratings on certain bank facilities of Jai Maharashtra Nagar Development Private Limited (JMNDPL), as: Amount Facilities (INR crore) Ratings ---------- ----------- ------- Non-Convertible Debentures (NCD) 78.00 [ICRA]D; Reaffirmed Rationale The rating reaffirmation factors in the continuing delays in debt servicing as well as breach of the covenants of the debenture trust deed by failing to provide additional security within the stipulated timelines. ICRA notes that the principal and premium amounts due from JMNDPL for redemption of NCD on March 16, 2016 and June 16, 2016 remain overdue as on date. The execution risk continues to remain high following delays of over four years in commencement of the project, coupled with high regulatory risk led by expiry of critical approvals including Intimation of Disapproval (IOD). The project also faces high market risk, given that no sales have been recorded and advances collected against bookings have been refunded. Key rating drivers and their description Credit strengths Not Applicable Credit challenges Delays in debt servicing pertaining to NCD and continuing breach of covenants of debenture trustee deed - The debentures were initially due for redemption in March 16, 2015 and November 16, 2015. These were subsequently restructured, and the redemption dates were extended to March 16, 2016 and June 16, 2016. The company, however, failed to provide additional security within the stipulated timelines post the restructuring of the NCDs in 2015, leading to a breach of the covenants of the debenture trust deed. Furthermore, the principal and premium amounts due for redemption remain overdue as on date. High execution risk as there has been no progress in the project over the past four years - The company had planned to commence construction in 2013. It, however, failed to receive critical approvals including IOD for the sale portion, leading to delays in project execution since construction has not started at the site as yet. High regulatory risk with delay in receipt of approvals and project execution by over four years – All the regulatory approvals received by the project have expired. Since there has been no progress in the project, the company has not applied for any new approvals, which exposes the project to high regulatory risk. Market risk given that the project is stalled - The company had launched 122 out of the planned 897 saleable units in August 2012. However, due to delay in project execution, all the bookings have been cancelled and the advances refunded to customers. Liquidity position: Poor JMNDPL's fund flow from operations (FFO) has remained negative for the last five years. It had an outstanding NCD of INR78.00 crore as on March 31, 2019. ICRA notes that there is a major concern on liquidity, since the project is not operational to generate cash inflows and debt repayments are yet to be made, resulting in severe cashflow mismatch. Rating sensitivities Positive triggers - The ratings may be upgraded if the company repays its outstanding NCDs and interest accrued. Negative triggers – Not Applicable JMNDPL is a special purpose vehicle promoted by a Mumbai-based promoter group for the redevelopment of the Jai Maharashtra Nagar Co-operative Housing Federation Limited—a federation of eight societies at Borivali (East) in Mumbai. The redevelopment project entails rehabilitation of its existing society tenants, as part of the free-sale component of the project, while the company has been entitled to sell about 1.23 million square feet of saleable area. The company has not recorded any revenues in FY2018 and FY2019. JMNDPL recorded net loss of INR0.40 crore and INR0.22 crore in FY2018 and FY2019, respectively. JOYMAKALI COLD: ICRA Keeps B on INR5.62cr Loan in Not Cooperating ----------------------------------------------------------------- ICRA said the ratings for the INR6.00 crore bank facilities of Joymakali Cold Storage Private Limited (JCSPL) continues to remain under the 'Issuer Not Cooperating' category. The rating is denoted as "[ICRA]B (Stable)/[ICRA]A4 ISSUER NOT COOPERATING". Amount Facilities (INR crore) Ratings ---------- ----------- ------- Fund-based– 5.62 [ICRA]B (Stable) ISSUER NOT Cash Credit COOPERATING; Rating continues to remain under the 'Issuer Not Cooperating' category Untied Limits 0.38 [ICRA]B (Stable)/[ICRA]A4 ISSUER NOT COOPERATING; Rating continues to remain under the 'Issuer Not Cooperating' Category ICRA has been trying to seek information from the entity so as to monitor its performance, but despite repeated requests by ICRA, the entity's management has remained non-cooperative. The current rating action has been taken by ICRA basis best available/dated/ limited information on the issuers' performance. Accordingly, the lenders, investors and other market participants are advised to exercise appropriate caution while using this rating as the rating may not adequately reflect the credit risk profile of the entity. Incorporated in 1978 as a private limited company, Joymakali Cold Storage Private Limited (JCSPL) is a closely held company promoted by Mr. Naba Kumar Kundu and his family members. The company provides cold-storage facility to potato-growing farmers and traders on a rental basis with a storage capacity of 150,604 quintals. The cold-storage unit is located in Burdwan, West Bengal. K. VENKATA RAJU: ICRA Withdraws B+ Rating on INR25cr LT Loan ------------------------------------------------------------ ICRA has withdrawn ratings on certain bank facilities of K. Venkata Raju Engineers & Contractors (P) Ltd., as: Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long Term-Fund 9.00 [ICRA]B+ (Stable) ISSUER NOT Based/CC COOPERATING; Withdrawn Long Term-Non 25.00 [ICRA]B+ (Stable) ISSUER NOT Fund Based COOPERATING; Withdrawn Rationale The rating assigned to K. Venkata Raju Engineers & Contractors (P) Ltd. has been withdrawn at the request of the company, and in accordance with ICRA's policy on withdrawal and suspension. ICRA does not have any information to suggest that the credit risk has changed since the time the rating was last reviewed. Key rating drivers The key rating drivers have not been captured as the rated instrument(s) are being withdrawn. Liquidity position Liquidity position has not been captured as the rated instruments are being withdrawn. Rating sensitivities Rating sensitivities have not been captured as the rated instruments are being withdrawn Established in 1990 as a partnership firm, K. Venkata Raju Engineers & Contractors is a civil construction company engaged in the construction of highways, runways, over-bridges, power transmission lines, railway track works amongst others. In the year 2014, the firm was incorporated as K. Venkata Raju Engineers & Contractors Private Limited. In addition to executing projects under its own name, the company also executes projects on a sub-contract arrangement. LB COTTON: ICRA Keeps D on INR10cr Loans in Not Cooperating ----------------------------------------------------------- ICRA said the ratings for the INR10.00 crore bank facilities of Lb Cotton Industries LLP continues to remain under the 'Issuer Not Cooperating' category. The rating is denoted as "[ICRA]D ISSUER NOT COOPERATING". Amount Facilities (INR crore) Ratings ---------- ----------- ------- Fund based- 5.00 [ICRA] D ISSUER NOT COOPERATING; Term Loans Rating continues to remain under the 'Issuer Not Cooperating' category Fund based- 5.00 [ICRA] D ISSUER NOT COOPERATING; Cash Credit Rating continues to remain under the 'Issuer Not Cooperating' category ICRA has been trying to seek information from the entity so as to monitor its performance, but despite repeated requests by ICRA, the entity's management has remained non-cooperative. The current rating action has been taken by ICRA basis best available/dated/limited information on the issuers' performance. Accordingly, the lenders, investors and other market participants are advised to exercise appropriate caution while using this rating as the rating may not adequately reflect the credit risk profile of the entity. Promoted by Mr. Dharmendra Pande and his four brothers in August 2011, LB Cotton commenced ginning and pressing activities in October 2013, while the crushing activity commenced from December 2014. The firm's facility is in Dharmabad, Nanded (Maharashtra), over a land area of about 2.30 hectares and is equipped with 24 double rolling ginning machines, one pressing machine and seven expellers, with an installed production capacity of 240 bales per day and a seed-crushing capacity of 850 quintals per day. LOK ENTERPRISES: ICRA Keeps 'D' on INR11cr Loans in Not Cooperating ------------------------------------------------------------------- ICRA said the ratings for the INR10.00 crore bank facilities of Lok Enterprises continues to remain under the 'Issuer Not Cooperating' category. The rating is denoted as "[ICRA]D/ [ICRA]D ISSUER NOT COOPERATING". Amount Facilities (INR crore) Ratings ---------- ----------- ------- Non-fund Based 10.00 [ICRA]D ISSUER NOT COOPERATING; Letter of Credit Rating continues to remain under the 'Issuer Not Cooperating' category Fund based- 1.00 [ICRA]D ISSUER NOT COOPERATING; Cash Credit Rating continues to remain under the 'Issuer Not Cooperating' category ICRA has been trying to seek information from the entity so as to monitor its performance, but despite repeated requests by ICRA, the entity's management has remained non-cooperative. The current rating action has been taken by ICRA basis best available/dated/limited information on the issuers' performance. Accordingly, the lenders, investors and other market participants are advised to exercise appropriate caution while using this rating as the rating may not adequately reflect the credit risk profile of the entity. Established in 2002 as a partnership firm, LE is a trading house engaged in trading of various forms of pulses and beans into the domestic market. The firm has its registered office in Mumbai and a warehouse facility located in Vashi, Navi Mumbai. The firm undertakes import of pulses and beans and supplies it into domestic markets. The agricultural products comprise of raw pulses such as Masoor (split red lentils), Moong (split yellow lentil), Chana (chick peas), Black eye bean, Toor Whole, Pinto bean etc. The traded goods are largely procured directly from international market. About 75% of the materials are sourced from Africa, Canada, USA, Argentina, Burma and Russia; while the remaining 25% are procured domestically. MDA MINERAL: ICRA Keeps C+ Debt Ratings in Not Cooperating ---------------------------------------------------------- ICRA said the ratings for the INR13.50-crore bank facilities of MDA Mineral Dhatu (AP) Private Limited (MDA) Continues to remain under 'Issuer Not Cooperating' category'. The ratings are denoted as "[ICRA]C+/[ICRA]A4 ISSUER NOT COOPERATING". Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long Term- 5.00 [ICRA]C+; ISSUER NOT Fund Based COOPERATING; Rating Continues Cash Credit to remain under issuer not cooperating category Long Term- Fund 6.00 [ICRA]C+; ISSUER NOT Based Term Loan COOPERATING; Rating Continues to remain under issuer not cooperating category Long Term-Non 2.50 [ICRA]C+; ISSUER NOT Fund Based COOPERATING; Rating Continues to remain under issuer not cooperating category Short Term- (2.50) [ICRA]A4; ISSUER NOT Interchangeable COOPERATING; Rating Continues to remain under issuer not cooperating category ICRA has been trying to seek information from the entity so as to monitor its performance, but despite repeated requests by ICRA, the entity's management has remained non-cooperative. The current rating action has been taken by ICRA basis best available information on the issuers' performance. Accordingly, the lenders, investors and other market participants are advised to exercise appropriate caution while using this rating as the rating may not adequately reflect the credit risk profile of the entity. MDA Mineral Dhatu (AP) Pvt. Ltd. (MDA) was incorporated in 2010 by Mr. Vidhan Mittal, Mr. Vijay Kumar Mittal and Mr.Chagan Lal Mittal as directors. The factory of the company is located at owened premises at Bobbili, Vijayanagaram, Andhra Pradesh, spread over 4.0 acres an build up area of ~4 acres. MDA Mineral Dhatu (AP) Pvt. Ltd (MDA) is a 6MVA ferro alloy unit was incorporated in the year 2011 after its de-merger from MDA Projects India Pvt Limited. As informed by the management, the original company- MDA Projects India Pvt Ltd has been dissolved after the incorporation of MDA Mineral Dhatu (AP) Private Limited. The company proposed to commence the commercial production in June 2012, however, the trail production commenced on June 29, 2013. MEGHRAJ IMPEX: Ind-Ra Migrates B+ Issuer Rating to Non-Cooperating ------------------------------------------------------------------ India Ratings and Research (Ind-Ra) has migrated Meghraj Impex Private Limited's Long-Term Issuer Rating to the non-cooperating category. The issuer did not participate in the rating exercise despite continuous requests and follow-ups by the agency. Therefore, investors and other users are advised to take appropriate caution while using these ratings. The rating will now appear as 'IND B+ (ISSUER NOT COOPERATING)' on the agency's website. The instrument-wise rating action is: -- INR150.00 mil. Non-fund-based limit migrated to non- cooperating category with IND A4 (ISSUER NOT COOPERATING) rating. Note: ISSUER NOT COOPERATING: The ratings were last reviewed on March 27, 2019. Ind-Ra is unable to provide an update, as the agency does not have adequate information to review the ratings. COMPANY PROFILE Incorporated in 2007, Meghraj Impex is a distributor of electronic consumer durable distributorship for Sony India in around 10 districts of Odisha. It is also a distributor of Blue Star air conditioners and Greenlam Laminates (belongs to Greenply Industries Limited). Arvind Kumar Agarwal is the promoter. N.D. PLASTICS: Ind-Ra Migrates B Issuer Rating to Non-Cooperating ----------------------------------------------------------------- India Ratings and Research (Ind-Ra) has migrated N.D. Plastics' (NDP) Long-Term Issuer Rating to the non-cooperating category. The issuer did not participate in the rating exercise despite continuous requests and follow-ups by the agency. Therefore, investors and other users are advised to take appropriate caution while using the ratings. The rating will now appear as 'IND B (ISSUER NOT COOPERATING)' on the agency's website. The instrument-wise rating actions are: -- INR80.0 mil. Fund-based facilities migrated to non-cooperating category with IND B (ISSUER NOT COOPERATING) / IND A4 (ISSUER NOT COOPERATING) rating; and -- INR30.0 mil. Non-fund based facilities migrated to non- cooperating category with IND A4 (ISSUER NOT COOPERATING) rating. Note: ISSUER NOT COOPERATING: The ratings were last reviewed on April 4, 2019. Ind-Ra is unable to provide an update, as the agency does not have adequate information to review the ratings. COMPANY PROFILE Formed in 1987, Mumbai-based N.D. Plastics is a proprietorship firm engaged in the trading and importing of polymer products such as high- and low-density polyethylene, polyvinyl chloride, and others. NARAYANADRI HOSPITALS: Ind-Ra Raises LT Issuer Rating to 'B-' ------------------------------------------------------------- India Ratings and Research (Ind-Ra) has upgraded Narayanadri Hospitals and Research Institute Private Limited's (NHRIPL) Long-Term Issuer Rating to 'IND B-' from 'IND D'. The Outlook is Stable. The instrument-wise rating actions are: -- INR76.90 mil. (reduced from INR104.1 mil.) Term loan due on February 2026 upgraded with IND B-/Stable rating; and -- INR46.7 mil. (increased from INR19.5 mil.) Fund-based working capital limits upgraded with IND B-/Stable/IND A4 rating. KEY RATING DRIVERS Liquidity Indicator – Poor: The upgrade reflects NHRIPL's timely repayment of debt obligations since April 2019. However, the company's average maximum utilization of the fund-based limits was 92.4% for the 12 months ended in December 2019. Also, the cash flow from operations dipped to INR4 million in FY19 (FY18: INR13 million) because of a decline in absolute EBITDA to INR6 million in FY19 (FY18: INR26 million). The free cash flow from operations also was negative at INR3 million owing to CAPEX of INR7 million during FY19. The debt repayments for FY20 amount to INR8.46 million. The cash and cash equivalents at end-FY19 were INR0.93 million (FY18: INR2.36 million). The ratings are also constrained by the company's continued small scale of operations, with revenue declining to INR184 million in FY19 (FY18: INR204 million), due to a decrease in the occupancy level to 80% (90%). Moreover, the EBITDA margins were modest and declined substantially to 3.4% in FY19 (FY18: 12.9%), owing to an increase in variable expenses. As of 9MFY20, revenue booked was INR158 million and EBITDA margins were 17.1%. The increase in revenue led to an increase in margins in 9MFY20. Return on capital employed was -5% in FY19 (FY18: 2%). Moreover, the credit metrics are weak, despite improvement. The gross interest coverage (operating EBITDA/gross interest expense) deteriorated to 0.5x in FY19 (FY18: 1.8x) and net leverage (adjusted net debt/operating EBITDA) to 23.1x (5.2x) due to the decrease in absolute EBITDA. During 9MFY20, the gross coverage was 2.7x and net leverage was 5.1x. The ratings remain supported by the promoters' combined experience of over five decades in the healthcare industry. RATING SENSITIVITIES Negative: Further deterioration in the liquidity position would lead to a downgrade of the ratings. Positive: A significant increase in the revenue and EBITDA margins, leading to an improvement in the credit metrics, and improved liquidity would be positive for the ratings. COMPANY PROFILE Incorporated in 2010, NHRIPL is a 250-bed multi-specialty hospital, located in Tirupati, Andhra Pradesh. RANA SUGARS: ICRA Maintains 'D' Debt Ratings in Not Cooperating --------------------------------------------------------------- ICRA said the ratings for the INR720.00 crore bank facilities of Rana Sugars Limited to remain under Issuer Not Cooperating category. The long-term and short-term ratings are denoted as [ICRA]D/[ICRA]D ISSUER NOT COOPERATING. Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long Term-Fund 502.20 [ICRA]D; ISSUER NOT COOPERATING; Based-Cash Rating Continues to remain under Credit the 'Issuer Not Cooperating' category Long Term-Fund 104.87 [ICRA]D; ISSUER NOT COOPERATING; Based-Term Loans Rating Continues to remain under the 'Issuer Not Cooperating' category Long Term 81.13 [ICRA]D; ISSUER NOT COOPERATING; Unallocated Rating Continues to remain under the 'Issuer Not Cooperating' category Short Term-Non 31.80 [ICRA]D; ISSUER NOT COOPERATING; Fund Based-BGs Rating Continues to remain under and LCs the 'Issuer Not Cooperating' category ICRA has been trying to seek information from the entity so as to monitor its performance, but despite repeated requests by ICRA, the entity's management has remained non-cooperative. The current rating action has been taken by ICRA basis dated information on the issuers' performance. Accordingly, the lenders, investors and other market participants are advised to exercise appropriate caution while using this rating as the rating may not adequately reflect the credit risk profile of the entity. RSL is engaged in the business of manufacturing sugar and undertaking the allied businesses of cogeneration and distillery. Incorporated in July 1991, RSL was promoted by Rana Gurjeet Singh and Rana Ranjit Singh as a joint venture with Punjab Agro Industrial Corporation Ltd. (PAIC). At present, the company is being managed under the managing directorship of Rana Inder Pratap Singh. PAIC divested its stake in Rana Sugars during FY2005 by selling its stake to the promoters, as per the provisions of the Financial Collaboration Agreement. S.S. COTTON INDUSTRIES: ICRA Keeps B+ Debt Rating in NonCooperating ------------------------------------------------------------------- ICRA said the ratings for the INR20.00-crore bank facilities of S.S. Cotton Industries Private Limited (SSCIPL) Continues to remain under 'Issuer Not Cooperating' category'. The ratings are denoted as "[ICRA]B+(Stable) ISSUER NOT COOPERATING". Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long Term- 18.50 [ICRA]B+ (Stable); ISSUER NOT Fund Based COOPERATING; Rating Continues Cash Credit to remain under issuer not cooperating category Long Term- 1.50 [ICRA]B+ (Stable); ISSUER NOT Unallocated COOPERATING; Rating Continues to remain under issuer not cooperating category ICRA has been trying to seek information from the entity so as to monitor its performance, but despite repeated requests by ICRA, the entity's management has remained non-cooperative. The current rating action has been taken by ICRA basis best available information on the issuers' performance. Accordingly, the lenders, investors and other market participants are advised to exercise appropriate caution while using this rating as the rating may not adequately reflect the credit risk profile of the entity. M/s S.S.Cotton Industries Pvt. Ltd. was incorporated in May 2011 with the object of carrying on the business of ginning and pressing with a capacity of 48 gins along with delinting spread across an area of 3 acres. The operations of the plant commenced from Dec 2011. It is located in Bhainsa, Adilabad dist of AP. The business is promoted by Mr Rama Rao Pawar and his sons Mr Sandeep Pawar and Mr Satish Pawar. The family has been involved in the business since last three decades. SLN CNC TECH: ICRA Lowers Rating on INR4.50cr Loan to 'C' --------------------------------------------------------- ICRA has revised the ratings on certain bank facilities of Sln Cnc Tech Pvt. Ltd., as: Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long Term- 4.50 [ICRA]C ISSUER NOT COOPERATING; Fund Based/CC Rating downgraded from [ICRA]B+ (Stable) and continues to remain in the 'Issuer Not Cooperating' category Long Term- 1.16 [ICRA]C ISSUER NOT COOPERATING; Fund Based TL Rating downgraded from [ICRA]B+ (Stable) and continues to remain in the 'Issuer Not Cooperating' category Short Term- 1.00 [ICRA]A4; ISSUER NOT Fund Based COOPERATING; Rating continues to remain in 'Issuer Not Cooperating' category Short Term- 0.75 [ICRA]A4; ISSUER NOT Non-Fund Based COOPERATING; Rating continues to remain in 'Issuer Not Cooperating' category Long Term/Short 2.59 [ICRA]C/[ICRA]A4; ISSUER NOT Term-Unallocated COOPERATING; Rating downgraded from [ICRA]B+(Stable)/[ICRA]A4 and continues to remain in the 'Issuer Not Cooperating' category Rationale The ratings are downgrade because of lack of adequate information regarding Sln Cnc Tech Pvt. Ltd. performance and hence the uncertainty around its credit risk. ICRA assesses whether the information available about the entity is commensurate with its rating and reviews the same as per its "Policy in respect of non-cooperation by the rated entity". The lenders, investors and other market participants are thus advised to exercise appropriate caution while using this rating as the rating may not adequately reflect the credit risk profile of the entity, despite the downgrade. As part of its process and in accordance with its rating agreement with Sln Cnc Tech Pvt. Ltd., ICRA has been trying to seek information from the entity so as to monitor its performance, but despite repeated requests by ICRA, the entity's management has remained non-cooperative. In the absence of requisite information and in line with SEBI's Circular No. SEBI/HO/MIRSD4/CIR/2016/119, dated November 1, 2016, ICRA's Rating Committee has taken a rating view based on the best available information. SLN CNC Tech Pvt. Ltd., incorporated in the year 2008. It is promoted by a team of members having varied background. Manufacture precession components using most of the engineering materials to the highest industry standards in modern CNC machining facility, along with the ability to assure quality of complex fabricated assemblies. The company specializes in manufacturing of aluminium, stainless steel, titanium, nimonic, inconel and cobalt alloy products. It has a manufacturing facility located in Peenya Industrial Estate with total area of 21000 sq. ft. The company caters to customers in segments like aviation, automotive, space, defence, power generation and telecommunication. SRI JANARDHAN: ICRA Lowers Rating on INR9cr Loan to 'B+' -------------------------------------------------------- ICRA has revised the ratings on certain bank facilities of Sri Janardhan Raw And Boiled Rice Mill (SJRBRM), as: Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long Term- 9.00 [ICRA]B+(Stable) ISSUER NOT Fund Based- COOPERATING; Rating downgraded Cash Credit from [ICRA]BB- (Stable) and continues to remain under 'Issuer Not Cooperating' Category Long Term/ 3.00 [ICRA]B+(Stable)/A4 ISSUER NOT Short Term– COOPERATING; Long term Rating Unallocated downgraded from [ICRA]BB- (Stable) and continues to remain under 'Issuer Not Cooperating' category Rationale The rating downgrade is because of lack of adequate information regarding SJRBRM performance and hence the uncertainty around its credit risk. ICRA assesses whether the information available about the entity is commensurate with its rating and reviews the same as per its "Policy in respect of non-cooperation by the rated entity". The lenders, investors and other market participants are thus advised to exercise appropriate caution while using this rating as the rating may not adequately reflect the credit risk profile of the entity, despite the downgrade. As part of its process and in accordance with its rating agreement with Sri Janardhan Raw And Boiled Rice Mill, ICRA has been trying to seek information from the entity so as to monitor its performance, but despite repeated requests by ICRA, the entity's management has remained non-cooperative. In the absence of requisite information and in line with SEBI's Circular No. SEBI/HO/MIRSD4/CIR/2016/119, dated November 1, 2016, ICRA's Rating Committee has taken a rating view based on the best available information. Founded in 1998 as a partnership firm, Sri Janardhan Raw and Boiled Rice Mill (SJRBRM) is engaged in the milling of paddy to produce raw and boiled rice. It has installed capacity of 4 TPH (Tons per Hour) and the unit is located at Nellore district of Andhra Pradesh. The firm is promoted by Mr. Boyapati Janardhan and his wife, Mrs. Boyapati Sireesha. SRI LAKSHMI: ICRA Lowers Rating on INR9.50cr Loan to B+ ------------------------------------------------------- ICRA has revised the ratings on certain bank facilities of Sri Lakshmi Janardhan Rice Industries (SLJRI), as: Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long Term- 9.50 [ICRA]B+(Stable) ISSUER NOT Fund Based- COOPERATING; Rating downgraded Cash Credit from [ICRA]BB- (Stable) and continues to remain under 'Issuer Not Cooperating' Category Long Term/ 0.50 [ICRA]B+(Stable)/A4 ISSUER NOT Short Term– COOPERATING; Long term Rating Unallocated downgraded from [ICRA]BB- (Stable) and continues to remain under 'Issuer Not Cooperating' category Rationale The rating downgrade is because of lack of adequate information regarding SLJRI performance and hence the uncertainty around its credit risk. ICRA assesses whether the information available about the entity is commensurate with its rating and reviews the same as per its "Policy in respect of non-cooperation by the rated entity". The lenders, investors and other market participants are thus advised to exercise appropriate caution while using this rating as the rating may not adequately reflect the credit risk profile of the entity, despite the downgrade. As part of its process and in accordance with its rating agreement with Sri Lakshmi Janardhan Rice Industries, ICRA has been trying to seek information from the entity so as to monitor its performance, but despite repeated requests by ICRA, the entity's management has remained non-cooperative. In the absence of requisite information and in line with SEBI's Circular No. SEBI/HO/MIRSD4/CIR/2016/119, dated November 1, 2016, ICRA's Rating Committee has taken a rating view based on the best available information. Sri Lakshmi Janardhana Rice Industries (SLJRI) was established in the year 1991 by Mr. Boyapati Janardhan and three others and it was registered as "Sri Lakshmi Ganapathi Raw & Boiled Rice Mill". However, there were changes made to partnership deed over the years and consequently in 2007 Mr. Boyapati Janardhan and his wife, Mrs. Boyapati Sireesha had taken over all the assets and liabilities of Sri Lakshmi Ganapathi Raw & Boiled Rice Mill and registered under the name "Sri Lakshmi Janardhan Rice Industries". The firm is engaged in milling of paddy to produce raw and boiled rice and the plant located in Nellore District of Andhra Pradesh. The milling capacity of the plant is 4 tonnes per hour. SUAVE CORP: ICRA Keeps B on INR10cr Loan in Not Cooperating ----------------------------------------------------------- ICRA said the ratings for the INR10.00-crore bank facilities of Suave Corporation (India) Private Limited (SCIPL) Continues to remain under 'Issuer Not Cooperating' category'. The ratings are denoted as "[ICRA]B(Stable) ISSUER NOT COOPERATING". Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long Term- 10.00 [ICRA]B(Stable); ISSUER NOT Unallocated COOPERATING; Rating Continues to remain under issuer not cooperating Category ICRA has been trying to seek information from the entity so as to monitor its performance, but despite repeated requests by ICRA, the entity's management has remained non-cooperative. The current rating action has been taken by ICRA basis best available information on the issuers' performance. Accordingly, the lenders, investors and other market participants are advised to exercise appropriate caution while using this rating as the rating may not adequately reflect the credit risk profile of the entity. Suave Corporation (India) Private Limited (SCIPL) was incorporated in August 2012 by Mr Srihari Charan Damaraju. The company is involved in the trading of steel products like TMT bars, GI Sheets, MS Sheets, MS Flats, MS Rounds, billets and others. The company primarily buys steel products from various distributors and traders and sells to builders and construction companies in Andhra Pradesh and Telangana. TEKZA CERAMIC: ICRA Assigns B+ Rating to INR7cr Term Loan --------------------------------------------------------- ICRA has assigned rating to the bank facilities of Tekza Ceramic LLP, as: Amount Facilities (INR crore) Ratings ---------- ----------- ------- Fund-based Term Loan 7.00 [ICRA]B+ (Stable); assigned Fund-based Working Capital Facilities 5.00 [ICRA]B+ (Stable); assigned Non-fund Based Bank Guarantee 2.00 [ICRA]A4; assigned Rationale The assigned ratings take into account the firm's relatively small-scale operations and its weak financial risk profile, which is characterised by modest profit margins, highly leveraged capital structure, weak coverage indicators and stretched working capital cycle. Furthermore, the ratings factor in the highly fragmented tiles industry, which results in intense competition. The ratings are also constrained by the cyclicality inherent in the real-estate industry, which is the main end-user sector, and the exposure of Tekza Ceramic LLP's profitability to volatility in key inputs-gas prices. The ratings, however, favorably factor in the extensive experience of the promoters in the ceramic industry and the proximity to raw material sources, by virtue of its presence in Morbi (Gujarat). The Stable outlook on the [ICRA]B+ rating reflects ICRA's opinion that Tekza Ceramic LLP will continue to benefit from the experience of its promoters in the ceramic industry. Key rating drivers and their description Credit strengths Extensive experience of management in ceramic industry – Tekza Ceramic LLP is managed by promoters who have extensive experience in the ceramic industry by virtue of their prior association with other entities involved in the ceramic business. Location-specific advantage - The location of the firm's manufacturing facility in the ceramic hub of Morbi (Gujarat) provides easy access to quality raw materials, such as body clay, feldspar and glazed frit. Credit challenges Weak financial risk profile – The firm's scale of operation remains small as reflected from the operating income of INR16.78 crore in ~11MFY2020 (up to February 20, 2020). The overall financial risk profile remains weak, as evident from the small net-worth base of INR5.02 crore and gearing of 2.63 times as on February 20, 2020. The debt coverage indicators also remain weak owing to low profitability (Total Debt/OPBDITA at 4.33 times). The working capital intensity remained high, with NWC/OI at 30% as on ~11MFY2020-end, due to stretched receivables and high inventory holdings. The same has, however, lowered to 19% as on FY2019-end. The working capital requirements were partially funded by stretching the creditors, leading to high TOL/TNW of 3.91 times as on February 20, 2020. Margins vulnerable to intense competition and cyclicality in real-estate industry - The tile manufacturing industry is highly fragmented with stiff competition from the organised and the unorganised segments, apart from imports. The large number of players in the unorganised segment, with most of them located in Gujarat and operating on low-cost structures, creates a pressure on the prices. Moreover, the demand for tiles remains exposed to the cyclicality in the real-estate sector, which is at present facing a downward trend. Profitability susceptible to volatility in raw material and fuel prices - Despite the location-specific advantage of raw material procurement, the firm has limited control over the prices of other key inputs such as natural gas and coal. Thus, its margins remain exposed to adverse movements in gas and coal prices. Liquidity position: Stretched The liquidity position of the firm is stretched given the moderate scheduled debt repayments coupled with the absence of cushion in the cash credit limits. The firm has currently sought enhancement in its cash credit limit. In case of non-sanction/delay in sanction, timely support from promoters through capital infusion/unsecured loans remains crucial in case of any cash flow mismatch. Rating sensitivities Positive triggers – ICRA could upgrade Tekza Ceramic LLP's ratings if the firm demonstrates substantial growth in revenue and profitability on a sustained basis. Negative triggers – Negative pressure on Tekza Ceramic LLP's ratings could arise if there is weakening of capital structure, debt coverage indicators or liquidity profile owing to stretch in working capital cycle, any large debt funded capex or withdrawal of partner's capital. Established in March, 2018, as a limited liability partnership firm, Tekza Ceramic LLP commenced commercial production in March, 2019. Its product profile comprises vitrified parking tiles of 300 mm X 300 mm size. Its manufacturing unit is located at Morbi, the ceramic tile manufacturing hub of Gujarat, and is equipped to manufacture ~68,040 metric tonne (MT) of tiles per annum. THIRU MARGADARSHI: ICRA Cuts Ratings on INR10cr Loans to B+ ----------------------------------------------------------- ICRA has revised the ratings on certain bank facilities of Thiru Margadarshi Construction (P) Ltd., as: Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long Term-Fund 4.00 [ICRA]B+ (Stable) ISSUER NOT Based TL COOPERATING; Rating downgraded from [ICRA]BB- (Stable)and continues to remain in the 'Issuer Not Cooperating' Category Long Term- 6.00 [ICRA]B+ (Stable) ISSUER NOT Unallocated COOPERATING; Rating downgraded from [ICRA]BB- (Stable)and continues to remain in the 'Issuer Not Cooperating' Category Rationale The ratings are downgraded because of lack of adequate information regarding Thiru Margadarshi Construction (P) Ltd. performance and hence the uncertainty around its credit risk. ICRA assesses whether the information available about the entity is commensurate with its rating and reviews the same as per its "Policy in respect of non-cooperation by the rated entity". The lenders, investors and other market participants are thus advised to exercise appropriate caution while using this rating as the rating may not adequately reflect the credit risk profile of the entity, despite the downgrade. As part of its process and in accordance with its rating agreement with Thiru Margadarshi Construction (P) Ltd., ICRA has been trying to seek information from the entity so as to monitor its performance, but despite repeated requests by ICRA, the entity's management has remained non-cooperative. In the absence of requisite information and in line with SEBI's Circular No. SEBI/HO/MIRSD4/CIR/2016/119, dated November 1, 2016, ICRA's Rating Committee has taken a rating view based on the best available information. Thiru Margadarshi Construction Pvt. Ltd, promoted by Mr. Narayanan, was incorporated in 2003 and is involved in the business of real-estate development in Bangalore. At present, the company has seven ongoing projects for construction of residential apartments and commercial buildings in Bangalore. TRISTAR INTERCONTINENTAL: ICRA Cuts Rating on INR4cr Loan to D -------------------------------------------------------------- ICRA has revised the ratings on certain bank facilities of Tristar Intercontinental Private Limited (TIPL), as: Amount Facilities (INR crore) Ratings ---------- ----------- ------- Fund Based– 4.00 [ICRA]D ISSUER NOT COOPERATING; Cash Credit Rating downgraded from [ICRA]B+ (Stable) and continues to remain under 'Issuer Not Cooperating' category Non fund Based– 12.00 [ICRA]D ISSUER NOT COOPERATING; Letter of Credit Rating downgraded from [ICRA]A4 and continues to remain under 'Issuer Not Cooperating' Category Unallocated 9.00 [ICRA]D/[ICRA]D ISSUER NOT COOPERATING; Rating downgraded from [ICRA]B+ (Stable)/[ICRA]A4 and continues to remain under 'Issuer Not Cooperating' Category Rationale The rating downgrade reflects the delay in debt-servicing. The rating is based on limited information on the entity's performance since the time it was last rated in December 28, 2018. The lenders, investors and other market participants are thus advised to exercise appropriate caution while using this rating as the rating may not adequately reflect the credit risk profile of the entity, despite the downgrade. As part of its process and in accordance with its rating agreement with Tristar Intercontinental Pvt Ltd (TIPL), ICRA has been trying to seek information from the entity so as to monitor its performance, but despite repeated requests by ICRA, the entity's management has remained non-cooperative. In the absence of requisite information and in line with SEBI's Circular No. SEBI/HO/MIRSD4/CIR/2016/119, dated November 1, 2016, ICRA's Rating Committee has taken a rating view based on the best available information. Established in 1985, and promoted by Mr. Pawan Aggarwal, Tristar Intercontinental Private Limited (TIPL), erstwhile known as Tristar Iron and Steel Company Private Limited, was mainly involved in the business of dealing in iron and steel products. However, the commercial operations of the company commenced from 1995, which included trading in woollen products and at present TIPL is mainly involved in supplying scoured wool and yarn in the domestic and international markets. The company has its head office in Jogeshwari, Mumbai. VIJAY SABRE: ICRA Keeps C on INR10.9cr Loan in Not Cooperating -------------------------------------------------------------- ICRA said the ratings for the INR19.88 crore bank facilities of Vijay Sabre Safety Private Limited continues to remain under the 'Issuer Not Cooperating' category. The rating is denoted as "[ICRA] C/A4 ISSUER NOT COOPERATING". Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long-term Fund 10.90 [ICRA] C ISSUER NOT COOPERATING; Based Limits Rating continues to remain under the 'Issuer Not Cooperating' category Short-term Non- 8.98 [ICRA] A4 ISSUER NOT Fund Based COOPERATING; Rating continues to Limits remain under the 'Issuer Not Cooperating' category ICRA has been trying to seek information from the entity so as to monitor its performance, but despite repeated requests by ICRA, the entity's management has remained non-cooperative. The current rating action has been taken by ICRA basis best available/dated/limited information on the issuers' performance. Accordingly, the lenders, investors and other market participants are advised to exercise appropriate caution while using this rating as the rating may not adequately reflect the credit risk profile of the entity. Incorporated in 1988 by Mr. Jitendra Salot, VSSPL is engaged in manufacture and trading of fire and safety equipments. Its manufacturing and trading units are located at Silvassa and Umbergaon in Gujarat.The company is ISO 9000:2001 certified and its product range is approved by BIS (Bureau Of Indian Standards). VSSPL has been an authorised distributor of Scott Health & Safety Limited in India since inception. It's group concern, Vijay Latex Products Private Limited ([ICRA]D; withdrawn) is engaged in manufacturing of rubber gloves. WELCOME FOOTWEARS: Ind-Ra Maintains BB+ Rating in Non-Cooperating ----------------------------------------------------------------- India Ratings and Research (Ind-Ra) has maintained Welcome Footwears' (WF) Long-Term Issuer Rating of 'IND BB+ (ISSUER NOT COOPERATING)' in the non-cooperating category and has simultaneously withdrawn it. The ratings have been maintained in the non-cooperating category as the issuer did not participate in the rating exercise despite continuous requests and follow-ups by Ind-Ra. The instrument-wise rating actions are: -- INR60 mil. Fund-based working capital limits* maintaining to non-cooperating category and withdrawn; -- INR43 mil. Term loan^ due on May 2023 maintaining to non- cooperating category and withdrawn; and -- INR70 mil. Non-fund-based working capital limits$ maintaining to non-cooperating category and withdrawn. *Maintained fund based limit at IND BB+ (ISSUER NOT COOPERATING)/IND A4+ (ISSUER NOT COOPERATING) before being withdrawn ^Maintained term loan rating at IND BB+ (ISSUER NOT COOPERATING) before being withdrawn $Maintained non-fund based at IND A4+ (ISSUER NOT COOPERATING) before being withdrawn KEY RATING DRIVERS Ind-Ra is no longer required to maintain the ratings, as it has received a no-objection certificate from the rated facilities' lender. This is consistent with the Securities and Exchange Board of India's circular dated March 31, 2017, for credit rating agencies. COMPANY PROFILE Established in 1996 as a partnership firm, WF manufactures footwear at its manufacturing facility in Bahadurgarh, Haryana which has an annual installed capacity of 9.50 million pairs. YES BANK: To Consider Fundraising Plan on March 26 -------------------------------------------------- The Economic Times reports that Yes Bank on March 23 said its board will consider a proposal to raise funds via equity and bonds, at its meeting later this week. "The meeting of the board of directors of Yes Bank Ltd is scheduled for Thursday, March 26, 2020, at Mumbai to consider, amongst other agenda items, a proposal for raising funds by issue of equity shares/depository receipts/convertible bonds/debentures/warrants/any other equity-linked securities, through permissible modes," it said in a BSE filing, the report relays. ET relates that the bank said the fundraising plan will also include a qualified institutions placement, rights issue, and further public offer, among others, subject to such approvals. According to ET, the lender has already raised over INR10,000 crore from SBI and other key banks and financial institutions through sale of equity under its reconstruction plan approved by the government and the Reserve Bank of India (RBI). Additionally, the RBI has also extended a INR60,000-crore credit line to Yes Bank for meeting obligations, as per sources. According to Section 17 of the Reserve Bank of India Act, 1934, the central bank can provide liquidity support to any lender in the form of loans and advances against collateral such as stocks, funds and securities (other than immovable property) in which a trustee is authorised to invest trust money by an Act of Parliament, ET notes. According to the sources, the RBI's assessment found that Yes Bank had liquidity issues but no solvency problem or any other issue. The line of credit, however, is first such exercise by the central bank, says ET. After witnessing decent recovery since the RBI superseding its board and planning out the reconstruction scheme, the stock of the bank closed over 13 per cent down at INR39.75 apiece on the BSE due to the coronavirus pandemic gripping the markets globally, the report says. About Yes Bank Yes Bank Limited provides banking services. The Bank offers deposits, personal loans, e-banking, trade finance, corporate, and business banking services. YES BANK serves the food and agribusiness, life sciences, healthcare, biotechnology, telecommunications, media, information technology, and infrastructure development industries in India. As reported in Troubled Company Reporter-Asia Pacific on March 18, 2020, Moody's Investors Service upgraded Yes Bank Limited's long-term foreign currency issuer and foreign currency senior unsecured MTN program ratings to Caa1 from Caa3 and (P)Caa1 from (P)Caa3 respectively. In addition, Moody's has confirmed the bank's long-term foreign and local currency bank deposit ratings at Caa1. Moody's has also confirmed the bank's long-term domestic and foreign currency Counterparty Risk Rating and long-term Counterparty Risk Assessment at Caa1 and Caa1(cr) respectively. Lastly, Moody's has affirmed Yes Bank's Baseline Credit Assessment (BCA) and adjusted BCA at ca. The rating outlook is positive. The rating action concludes the review with direction uncertain that was initiated on Yes Bank's ratings on March 6, 2020. ========= J A P A N ========= JAPAN POST: Unit Proposes to Cut 10,000 Jobs Amid Falling Revenue ----------------------------------------------------------------- The Manichi reports that Japan Post Holdings Co. has received a proposal by a group company to cut 10,000 jobs, as the scandal-hit company seeks to offset deteriorating earnings in the financial business by slashing labor costs, a source close to the matter said March 23. Japan Post Bank Co., a unit of the former state-owned postal and financial giant, is proposing dismissing 10,000 post office workers, or 5 percent of the total workforce at Japan Post Co., another unit of the group, the source said, the Manichi relates. According to the report, the postal service unit garners a large part of its revenue through fees paid by the banking unit and another financial group company, Japan Post Insurance Co., via sales of their products through some 24,000 post offices nationwide. The Manichi, citing the latest earnings of Japan Post Holdings released last month, says the banking and insurance units are forecast to post a drop of 23 percent and 13 percent in revenue for the fiscal year to March respectively. Their revenues are not expected to recover anytime soon as they have halted financial-product sales after a scandal came to light last year involving fraudulent sales of investment trust funds and insurance policies at post offices, the report relates. The Financial Services Agency late last year ordered the two units to suspend new sales of insurance products, the report recalls. While the ban was lifted, they have continued self-imposed restrictions on new sales. Even before the ban was imposed, financial institutions have seen their profit margins squeezed by years of low interest rates under the Bank of Japan's ultraeasy monetary policy, the report notes. The Manichi notes that the postal service unit is opposed to the proposed job cuts, saying it is not feasible. The idea has not been officially discussed at a board meeting of Japan Post Holdings, the source said. The labor union of Japan Post Holdings said it has received no official proposal of job cuts, the report adds. Japan Post Holdings Co. offers postal and package delivery services, banking services, and life insurance. Japan Post Holdings was formed in October 2007 to oversee the four operating companies, which were created from a state agency known as Japan Post. The holding company structure was implemented as a step toward the eventual privatization of the underlying businesses. =============== M A L A Y S I A =============== PRESS METAL: S&P Alters Outlook to Negative & Affirms 'B+' ICR -------------------------------------------------------------- S&P Global Ratings, on March 23, 2020, revised its outlook on Press Metal Aluminium Holdings Bhd. (PMB) to negative from stable. At the same time, S&P affirmed its 'B+' long-term issuer credit rating on the company and the 'B+' long-term issue rating on its guaranteed senior unsecured notes. S&P revised the outlook on PMB to negative because it believes weaker aluminum prices could depress the company's earnings over the next nine to 12 months. In addition, the current turbulence in capital markets could reduce funding availability at a time when the company is expanding its smelting capacity. S&P affirmed the ratings because PMB's low-cost operations put the company on a better footing to navigate the downturn in its end markets compared with peers. New capacity coming on-stream in 2021 may help the company's earnings recover quickly when prices normalize in 2021, in our view. PMB's FFO-to-debt ratio will fall below 20% in 2020 due to weaker aluminum prices. On March 16, 2020, S&P Global Ratings lowered its aluminum price assumptions by about 10%, or US$200/ton from 2020 through 2022. S&P said, "We now expect average aluminum prices to be US$1,700/ton for 2020, US$1,800/ton for 2021, and US$1,900/ton for 2022. We estimate that lower aluminum prices will reduce PMB's EBITDA to about Malaysian ringgit (MYR) 1 billion in 2020, from about MYR1.2 billion in 2019. This is around MYR600 million lower than our previous forecast. We also project the company's 2021 EBITDA will be MYR1.4 billion, about MYR500 million lower than our previous estimate. Thus, we forecast PMB's FFO-to-debt ratio will fall to 16% in 2020, compared with our previous expectation of 30%." Continued capital deployment for growth aspirations may strain liquidity amid weaker macroeconomic conditions. S&P said, "We expect PMB to deploy up to MYR1.4 billion of capital outlay for growth aspirations in 2020, up from MYR1.2 billion in 2019. Of the total amount, MYR800 million is earmarked for PMB's 25% stake acquisition in PT Bintan Alumina Indonesia (PT BAI), backed by committed facilities. The remaining MYR600 million will be spent on the company's phase three smelter expansion in its Bintulu plant in Samalaju, Sarawak. The Bintulu plant is expected to be commissioned in the fourth quarter of 2020 and add 42% in smelting capacity. We estimate that phase three will increase PMB's production by about 160 thousand tons (kt) in 2021. This translates to MYR200 million of additional EBITDA, based on our projected EBITDA per ton of US$320 for 2020. We expect to see the additional EBITDA only in 2021, given that new aluminum smelting facilities typically take up to six months to ramp up to full production. With higher capital spending amid reduced cash flow generation in 2020, we expect PMB's gross debt to increase by close to MYR1.1 billion, potentially reaching MYR4.8 billion by end-2020." Low cash pile and sizable short-term maturities create uncertainty in a period of macroeconomic weakness. PMB does not have any material bullet maturity until October 2022, when its US$400 million of senior unsecured notes will mature. At the same time, the company has about MYR600 million of short-term debt as of Dec. 31, 2019, which is matched by MYR300 million of cash. Hence, PMB's ability to fund its capital expenditure (capex) will depend largely on cash flow generated from operations. This may strain PMB's liquidity position as any unexpected working capital buildup in a weaker macroeconomic environment will strain the company's liquidity position, in S&P's view. However, S&P acknowledges that PMB can delay capex as it has leeway to defer its capacity expansion into 2021. This would push the additional capacity coming online to a later date. PMB's strong position as an efficient aluminum producer will help the company navigate the weaker pricing environment better than global peers. In S&P's view, PMB's first-quartile position on the global aluminum cost curve will help mitigate the adverse effects from the weaker pricing environment. Prices of key raw materials, such as alumina and pre-baked carbon anode, should also fall in tandem with lower aluminum prices, supporting profitability. Moreover, it estimates about 30% of PMB's 2020 production is hedged at above US$1,900/ton. S&P said, "The negative outlook reflects our view that PMB's profitability and cash flow generation could weaken amid the sluggish macroeconomic environment, potentially disrupting the company's access to sources of funding for its growth aspirations. "We could lower the rating if aluminum prices fall below US$1,700/ton for a prolonged period of time, putting a strain on the company's liquidity position. "We could also lower the rating if we do not expect PMB's FFO-to-debt ratio to improve comfortably above 20%. Such a scenario would most likely occur if production from phase three does not ramp up in 2021 and aluminum prices stay below US$1,800/ton, implying a yearly EBITDA of below MYR1.1 billion for the company. "We could revise the outlook to stable if higher aluminum prices support PMB's FFO-to-debt ratio comfortably above 20% over the next two to three years. This could happen if aluminum prices remain above US$1,800/ton at current production levels, or if production from phase three ramps up smoothly in 2021 with prices remaining above US$1,700/ton." A stable outlook would also be dependent on PMB addressing its short-term debt position. Founded in 1986, PMB is a Malaysia-based aluminum extrusion and smelting company, with operations mainly in Malaysia and China. It is the largest aluminum producer in Southeast Asia, with a smelting capacity of 760,000 metric tons per annum (mtpa) and an extrusion capacity of 210,000 mtpa across two plants in Selangor (50,000 mtpa), Malaysia and Foshan (160,000 mtpa), China. PMB's two smelters are in Samalaju (640,000 mtpa capacity) and Mukah (120,000 mtpa capacity), Sarawak, Malaysia, with power supplied under a favorably priced long-term power purchase agreement with local state electricity producer, Sarawak Energy Bhd. Sumitomo Corp. owns 20% of both smelting plants. SCOMI ENERGY: Unit Defaults on MYR80.41MM Loan Payment ------------------------------------------------------ Wong Ee Lin at theedgemarkets.com reports that KMCOB Capital Bhd, an indirect wholly-owned subsidiary of Scomi Energy Services Bhd, has defaulted on a loan payment amounting to MYR80.41 million that is immediately due and payable. theedgemarkets.com relates that Hong Leong Investment Bank Bhd as the facility agent under the KMCOB Bond and FGI Facility, has issued a notice to KMCOB, declaring an event of default, Scomi Energy said in a filing with Bursa Malaysia on March 12. The MYR80.41 million is equivalent to the amount paid by Danajamin Nasional Bhd to repay the KMCOB Bond pursuant to the claim made by the trustee, following the bond default, the Practice Note (PN17) company said, theedgemarkets.com relays. "KMCOB is in the midst of engaging with Danajamin towards an amicable resolution to address the repayment of the Relevant Amount (MYR80.41 million)," Scomi Energy, as cited by the report, said. The facility is secured against a number of securities including corporate guarantees, debentures and assignment of contract proceeds, the report says. Consequently, the default in payment may entitle Danajamin to the immediate enforcement of the above securities, theedgemarkets.com adds. Based in Malaysia, Scomi Energy Services Berhad -- https://scomienergy.com.my/ -- provides marine vessel transportation services. The Company offers marine logistical services to the coal industry and offshore marine support services to oil and gas operators and contractors. Scomi Energy Services serves the coal, oil and gas industries in South East Asia. Scomi Energy Services Bhd slipped into Bursa Malaysia's Practice Note 17 status in January 2020. Bursa said Scomi Energy had met the criteria subject to Paragraph 2.1 (e) of Practice Note No. 17 (PN17) of its Main Market listing requirements. Bursa said it would continue to monitor the company's progress in compliance with the listing requirements. On Oct. 31, 2019, Scomi Energy triggered the PN17 criteria after its shareholders' equity on a consolidated basis fell below 50 per cent of its issued share capital as at June 30, 2019. ===================== N E W Z E A L A N D ===================== DOWSONS SHOES: To Shut Stores in South Island After 82 Years ------------------------------------------------------------ Stuff.co.nz reports that Christchurch company Dowsons Shoes is shutting its stores for good after 82 years in business across the South Island. A message on the company's website said the business will cease trading and will run a clearance sale at its remaining stores until stocks run out, Stuff relates. "Retail has changed dramatically over the years and that change seems to be accelerating," it said. "The family has made the decision to cease trading in Footwear in 2020. Retail has been good to us and it's time for us to hang up the boots and move on to other things. "To our customers and staff, Thank you for 82 years of memories." According to Stuff, the five Dowsons Shoes stores left before the closure announcement were in Nelson, Dunedin and Invercargill, and at Church Corner and The Hub Hornby in Christchurch. The company's website said Knox Dowson opened his first premises in Ferry Rd, Christchurch, in 1938. "During the Second World War, Knox diverted his efforts into supporting the war effort by supplying troops with boots and shoes. After the war, Knox saw an opportunity to begin selling footwear from the front of his Ferry Rd Factory," it says. The company began expanding through the South Island and Wellington area in 1995. Its Timaru branch closed in January, while the Blenheim store closed in August last year, and the North Island's Lower Hutt branch in 2011, Stuff notes. =============== P A K I S T A N =============== PAKISTAN WATER: Fitch Assigns 'B-' LongTerm IDR, Outlook Stable --------------------------------------------------------------- Fitch Ratings has assigned Pakistan Water and Power Development Authority First-time Long-Term Foreign and Local-Currency Issuer Default Ratings of 'B-' with a Stable Outlook. WAPDA is a hydroelectric-oriented power-generation company, wholly owned by the government of Pakistan (B-/Stable), with the public policy mission of executing the unified and coordinated development of the country's water and power resources. The entity operates three key business units - hydroelectric, water and finance - after WAPDA's power wing was unbundled in 1998. The hydroelectric unit is WAPDA's core commercial business, accounting for around 95% of total revenue, and is regulated by the government. The company's ratings are based on its hydroelectric business, rather than the water and finance segments, as the hydroelectric unit is its only regulated business that engages in commercial activity; the water and finance segments are funded by government aid and grants. KEY RATING DRIVERS 'Very strong' Status, Ownership and Control: WAPDA was established under the WAPDA Act with parastatal status and is wholly owned by the government of Pakistan, which maintains tight control of the company. The entity's budget and accounts require government approval, as do changes in its powers, duties and projects. An audit report is submitted annually to the Committee on Public Accounts for scrutiny. 'Very strong' Support Record and Expectations: The government guarantees 38% of the entity's debts, or 58% if excluding re-lending that was ultimately incurred with the government. The government funds the majority of WAPDA's projects via grants, re-lending and loans. It also provides a favorable tariff scheme is sufficiently to meet WAPDA's operating costs and provides a reasonable return on investment. Fitch expects consistent support due to the importance of the hydroelectric plants and the company's contribution to economic development. 'Strong' Socio-Political Implications of Default: WAPDA is responsible for the country's hydropower generation, flood control and water supply. It is Pakistan's largest hydropower supplier, accounting for more than a quarter of the country's power generation and 95% of hydropower capacity in 2019. WAPDA's hydroelectric share in the country's power generation mix is planned to expand to 35% by 2028, from 29% in 2018, according to National Electric Power Regulatory Authority, which will intensify WAPDA's policy role. Its capacity is difficult to substitute, as independent power producers only account for 5% of hydroelectric capacity, implying severe service disruption should WAPDA fail. 'Very Strong' Financial Implications of Default: The entity is a proxy funding vehicle for the government, which contributes funds for WAPDA's projects and guarantees the company's overseas borrowings. WAPDA plans to finance on its own credit with less government involvement and this is likely to expand the government's borrowing capacity. Fitch expects a default by WAPDA to significantly affect government-related entities in the domestic and overseas markets in light of its parastatal status. Heavy Capex Ahead: Fitch expects heavy expansion capex over the next six years raise leverage, as measured by net debt/EBITDA, although it should remain below 7.0x in the medium-term (2019: 6.6x) due to the supportive tariff scheme. Fitch forecasts EBITDA interest coverage at 1.4x over the same period after factoring in rising debt and the tariff scheme adjustment. The capex will spur revenue growth, regardless utilization volatility, as the contractual framework reflects invested capital rather than electricity output. Zero dividend payouts and an income tax exemption also ease the burden. DERIVATION SUMMARY WAPDA's ratings are equalized with those of Pakistan, reflecting Fitch's assessment of the four factors in its GRE criteria that arrives at a weighted score of 50. The Standalone Credit Profile (SCP) is capped at the sovereign's IDR and therefore cannot exceed 'b-' given the central role of the government as a counterparty. The SCP does not affect the IDR due to the weighted GRE score of 50, which equalizes WAPDA's ratings with the sovereign rating, regardless the SCP. RATING SENSITIVITIES An upgrade of Fitch's credit view on the sovereign may trigger positive rating action on WAPDA. A sovereign downgrade, weaker government links or lower socio-political and financial implications of default may lead to negative rating action. ================= S I N G A P O R E ================= EAGLE HOSPITALITY: Gets Notice of Default on US$341 Million Loan ---------------------------------------------------------------- Fiona Lam at The Business Times reports that Eagle Hospitality Trust's (EHT) managers are delaying the distribution to stapled security holders, after having received a notice of default and acceleration on a syndicated loan of which US$341 million have been borrowed. BT relates that in a bourse filing on March 24, the managers disclosed that they received the notice on March 20, issued on behalf of Bank of America, the administrative agent for the syndicate of lenders. On behalf of the lenders, Bank of America exercised its right to accelerate the entirety of the loan. This means that the principal amount of US$341 million was declared to have become immediately due and owing, the managers said, BT relays. These lenders had provided term loan facilities and/or a revolving credit facility to Eagle Hospitality Real Estate Investment Trust (EH-Reit) in May 2019 under a facilities agreement. According to BT, the notice stated that an event of default has occurred for the loan, due to the master lessees' non-payment of rent to EHT under the master lease agreements (MLAs) for certain properties in EHT's portfolio. BT notes that the coronavirus pandemic has caused steep declines in occupancy levels in the hospitality market, and this has slashed the income productivity of the EHT properties and affected the master lessees' ability to pay rents. That being said, EHT itself has been meeting its own scheduled debt service obligations on the loan to the lenders as at March 20, the managers noted. In light of the notice of default and acceleration, the managers will not be able to draw on the security deposits as planned, the report says. They had said on March 19 that they were intending to use the security deposits to make the rent payments - owed by the master lessees to EHT - in accordance with the MLAs, and to increase liquidity. BT relates that stapled security holders will also not receive the distribution of 3.478 US cents per security on the previously announced payment date of March 30, 2020. The distribution is for the period from EHT's listing date of May 24, 2019 to Dec. 31, 2019. This is because EH-Reit is now restricted from paying out the distribution, following the acceleration of the loan. BT says the managers have deferred any action to pay the funds to The Central Depository for settlement of the distribution, pending further discussions with the lenders and pending overall assessment of the financial implications of the notice of default and acceleration. "Stapled security holders should note and expect that there is no certainty or assurance as to the period of the delay in receipt of the distribution or that such distribution will be made at all," they said on March 24. The managers are seeking professional advice and will need more time to assess the implications of the notice, BT relates. In addition, they need more time to engage in further discussions with the lenders, with a view to negotiate and obtain an agreement for the lenders to forebear from exercising their rights and remedies. BT says the managers are also aiming to develop a "longer-term consensual strategy for operating EHT going forward amid an unprecedented and extreme operating environment" in a way that protects the interests of EHT stapled security holders. On March 24 before market open, the managers requested a voluntary suspension in the trading of EHT stapled securities with immediate effect, BT adds. Eagle Hospitality Trust -- https://eagleht.com/ -- is a hospitality stapled group comprising Eagle Hospitality Real Estate Investment Trust (Eagle H-REIT) and Eagle Hospitality Business Trust (Eagle H-BT). Eagle HT has a well-diversified portfolio of primarily freehold, internationally branded hotels, across 11 major U.S. metropolitan statistical areas. GEO ENERGY: Moody's Cuts CFR to Caa3, Outlook Remains Negative -------------------------------------------------------------- Moody's Investors Service has downgraded the corporate family rating of Geo Energy Resources Limited to Caa3 from Caa1. In addition, Moody's has downgraded to Caa3 from Caa1 the senior unsecured guaranteed notes issued by Geo Coal International Pte. Ltd., a wholly-owned subsidiary of Geo Energy. The outlook on these ratings remains negative. RATINGS RATIONALE "The downgrade reflects a material deterioration in Geo Energy's liquidity following the company's continued discounted buybacks of its US dollar notes," says Maisam Hasnain, a Moody's Assistant Vice President and Analyst. "In addition, we believe that continued discounted buybacks represent an aggressive financial policy, particularly when the company needs to preserve cash to make an acquisition to prevent a put option on its bond by April 2021," adds Hasnain, also Moody's Lead Analyst for Geo Energy. On March 17, Geo Energy announced it spent $42.8 million to buy back $75.8 million in principal on its US dollar notes. Cumulatively, Geo Energy has now repurchased around $111 million of its original $300 million principal amount, at a considerable discount to the original par value. Moody's deems these transactions to constitute a distressed exchange, which is a default event under the rating agency's definition. Pro forma for the note's buybacks in March, Moody's estimates Geo Energy's cash balance would decline to around $84 million from $139 million at December 31, 2019. While debt buybacks will reduce the company's financial leverage and interest costs, continued buybacks at significant discounts indicate a loss of value for creditors. Geo Energy's cash balance will decline materially if its pending investment in two coal mines in South Sumatra from Titan Infrastructure Energy (TIE) is completed by March 31, 2020. Moody's estimates Geo Energy will need to pay around $22.5 million to purchase its stake in the two mines, and an additional $32.5 million in a refundable security deposit to secure the use of TIE's haul road and coal terminal for 10 years. This expenditure would eliminate a bulk of Geo Energy's remaining cash, leaving the company with a very small buffer to manage any volatility in its operations. Should the investment in the South Sumatra mines be delayed beyond the March 31 deadline or even cancelled, this would only temporarily preserve Geo Energy's liquidity. This is because without this investment, and in the absence of alternative investments, Geo Energy is unlikely to have the 80 million tons of minimum coal reserves it needs by April 4, 2021 to avoid triggering the put option on its US dollar notes. This will lead to elevated liquidity and refinancing risk because Geo Energy's cash would be insufficient to fully redeem the remainder of its notes. The ratings also consider Geo Energy's exposure to environmental; social and governance risks as follows: First, Geo Energy faces elevated environmental risks associated with the coal mining industry, including carbon transition risks as countries seek to reduce their reliance on coal power. However, the risk is somewhat mitigated as Geo Energy's customers are primarily located in Asia, a region with growing energy needs. Also, Geo Energy has off-take agreements with global commodity traders to purchase Geo Energy's coal for export. Geo Energy's two operating mines are adjacently located in South Kalimantan and vulnerable to adverse weather. For example, operations at one of its mines were temporarily halted for around a week in June due to prolonged flooding. However, the company's planned mine acquisitions in South Sumatra will reduce such operational concentration. Second, Geo Energy is exposed to social risks associated with the coal mining industry, including health and safety, responsible production, and societal trends. The company has implemented an Environmental and Social Management System, which seeks to address issues such as workplace health and safety procedures, and local community development. Finally, with respect to governance, Geo Energy's ownership is concentrated in its promoter shareholders, who own around 39% of the company. Governance risks considered also include financial policies around tolerance for high leverage and uncertainty around further discounted bond buybacks. The outlook is negative, reflecting Geo Energy's extremely weak credit profile and uncertainty over its current ability to prevent the put option on its US dollar notes from being triggered in April 2021, which if triggered would lead to large losses for noteholders as Geo Energy's cash would be insufficient to fully redeem the remainder of its outstanding notes. Upward pressure on Geo Energy's ratings is unlikely, given the negative outlook. Nevertheless, Moody's could stabilize the outlook if Geo Energy materially improves its financial profile, and effectively executes its plan to acquire new mines to ramp up production and improve its mine reserve life, effectively removing risk from the bondholder put option. On the other hand, Moody's could further downgrade the ratings if Geo Energy's cash balance continues to decline, or if it fails to acquire coal assets that improve its credit profile in the near term and eliminate the risk of its put option being triggered in April 2021. In addition, an inability to extend the licenses on its current mining concessions at substantially similar terms would likely lead to a rating downgrade. The principal methodology used in these ratings was Mining published in September 2018. Established in 2008 and listed on the Singapore Stock Exchange, Geo Energy Resources Limited is a coal mining group with mining concessions in South and East Kalimantan. Its promoter shareholders, including Charles Antonny Melati and Huang She Thong own around 39% of the company. ********* S U B S C R I P T I O N I N F O R M A T I O N Troubled Company Reporter-Asia Pacific is a daily newsletter co- published by Bankruptcy Creditors' Service, Inc., Fairless Hills, Pennsylvania, USA, and Beard Group, Inc., Washington, D.C., USA. Marites O. Claro, Joy A. Agravante, Rousel Elaine T. Fernandez, Julie Anne L. Toledo, Ivy B. Magdadaro and Peter A. Chapman, Editors. Copyright 2020. All rights reserved. ISSN: 1520-9482. This material is copyrighted and any commercial use, resale or publication in any form (including e-mail forwarding, electronic re-mailing and photocopying) is strictly prohibited without prior written permission of the publishers. Information contained herein is obtained from sources believed to be reliable, but is not guaranteed. TCR-AP subscription rate is US$775 for 6 months delivered via e- mail. Additional e-mail subscriptions for members of the same firm for the term of the initial subscription or balance thereof are US$25 each. For subscription information, contact Peter Chapman at 215-945-7000. *** End of Transmission ***