/raid1/www/Hosts/bankrupt/TCRAP_Public/200430.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
Thursday, April 30, 2020, Vol. 23, No. 87
Headlines
A U S T R A L I A
COMMERCIAL DIVING: Second Creditors' Meeting Set for May 6
COOL BREEZE: Discount Chain Dimmeys Goes Into Liquidation
MACKAY CITY: Second Creditors' Meeting Set for May 12
PERFUSION SOLUTIONS: Second Creditors' Meeting Set for May 8
SOUTHWEST REALTY: First Creditors' Meeting Set for May 27
STS HOLDINGS 1: Second Creditors' Meeting Set for May 8
VIRGIN AUSTRALIA: Bondholders in Talks With Hogan Lovells
VIRGIN AUSTRALIA: Velocity Rewards Pursues Carrier for AUD150MM
I N D I A
ACN TEX: CRISIL Lowers Rating on INR4.50cr Bill Loan to 'D'
ADI WIRES: CRISIL Maintains 'D' Debt Ratings in Not Cooperating
AIR INDIA: Government Extends Deadline for Bid to June 30
AKI INDIA: CRISIL Maintains 'B' Debt Ratings in Not Cooperating
ARJUN TECHNOLOGIES: CRISIL Keeps D Debt Ratings in Not Cooperating
ASIATIC ENTERPRISES: CRISIL Keeps B Debt Rating in Not Cooperating
C. BRIJESH REDDY: CRISIL Keeps C Rating in Not Cooperating
CHANDULAL CHANDRAKAR: CRISIL Keeps D Rating in Not Cooperating
CINEVISTA LIMITED: CRISIL Keeps B+ Debt Ratings in Not Cooperating
EAGLE HOSPITALITY: Appoints Moelis & Company as Financial Adviser
ESES BIO-WEALTH: CRISIL Keeps 'D' Debt Ratings in Not Cooperating
EXCEL VINYL: CRISIL Keeps D Debt Ratings in Not Cooperating
FLAGS HOTELS: CRISIL Keeps D on INR22cr Loan in Not Cooperating
GALFAN ENGINEERS: CRISIL Keeps B Debt Ratings in Not Cooperating
GOKUL STEELS: CRISIL Maintains 'D' Debt Ratings in Not Cooperating
HARI OM RICE: CRISIL Keeps D on INR20cr Credit in Not Cooperating
HARIOM COTGIN: CRISIL Keeps D on INR8cr Credit in Not Cooperating
HAZARILAL COLD: CRISIL Reaffirms B+ Rating on INR4.91cr Loan
INDO LAMINATES: CRISIL Keeps 'D' Debt Ratings in Not Cooperating
INDO SILICON: CRISIL Keeps B on INR6.5cr Credit in Not Cooperating
KANS WEDDING: CRISIL Lowers Rating on INR8.6cr Loan to 'D'
KARVY DATA: CRISIL Reaffirms 'D' Rating on INR190cr Cash Loan
KARVY DIGIKONNECT: CRISIL Reaffirms 'C' Ratings on INR65cr Loans
KARVY RENEWABLE: CRISIL Reaffirms 'C' Rating on INR12.15cr Loan
MOHITE INDUSTRIES: CRISIL Cuts Rating on INR31cr Loan to B+
PROMAS ENGINEERS: CRISIL Reaffirms B+ Rating on INR10cr Loan
R.A. MOTORS: CRISIL Lowers Rating on INR10cr Loan to 'D'
ROHINI METALS: CRISIL Hikes Rating on INR5cr Cash Loan to B-
SCIKNOW TECHNO: CRISIL Reaffirms 'C' Rating on INR7.5cr Loan
SHANKARRAO PAWAR: CRISIL Lowers Rating on INR25cr New Loan to D
SIVA SANKARA: CRISIL Lowers Rating on INR12.68cr Loan to 'D'
SRS LIMITED: CRISIL Maintains 'FD' Debt Rating in Not Cooperating
STRIDES PHARMA: Bank Debt Trades at 19% Discount
I N D O N E S I A
STOQO TEKNOLOGI: Startup Shuts Down Amid Coronavirus Outbreak
N E W Z E A L A N D
TITAN ACQUISITIONCO: Moody's Alters Outlook on B2 CFR to Neg.
S I N G A P O R E
EAGLE HOSPITALITY: 5 Hotel Managers in the U.S. Exit
HIN LEONG: Sembcorp Cogen Obtains Court Order to Secure Gasoil
T A I W A N
WAN HAI LINES: Moody's Alters Outlook on Ba2 CFR to Stable
- - - - -
=================
A U S T R A L I A
=================
COMMERCIAL DIVING: Second Creditors' Meeting Set for May 6
----------------------------------------------------------
A second meeting of creditors in the proceedings of Commercial
Diving & Marine Services Pty Limited has been set for May 6, 2020,
at 10:30 a.m. via telephone conference.
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 May 5, 2020, at 5:00 p.m.
Scott Andersen & Nathan Deppeler of Worrells Solvency & Forensic
Accountants were appointed as administrators of Commercial Diving
on March 23, 2020.
COOL BREEZE: Discount Chain Dimmeys Goes Into Liquidation
---------------------------------------------------------
Joyce Abaño at Inside Retail reports that liquidators have been
appointed to the owner of discount chain Dimmeys three months after
a management restructure was announced.
According to Inside Retail, Hall Chadwick partners Richard
Albarran, John Vouris and Richard Lawrence were appointed on April
24 as the joint and several liquidators of Cool Breeze Clothing Pty
Ltd, owner of Dimmeys, to undertake an orderly wind down of the
company's affairs.
They are seeking expressions of interest for the business.
Inside Retail says the 167-year-old retailer announced a management
restructure in January, when it said the bulk of stores would
remain open in its core market in Victoria, despite a previous
announcement in November 2019 of store closures elsewhere in the
country.
Inside Retail relates that the management restructure saw
part-owner Doug Zappelli take over the day-to-day running of the
company. At the time, he said he would push ahead with some store
closures but would keep open up to a dozen stores in Victoria.
The retailer, which once operated more than 40 stores across
Australia, took to Facebook to announce its closing down sale last
November, marking 30 per cent off its goods in order to sell
through as much inventory as it can, Inside Retail recalls.
The announcement took some staff by surprise, with a staff member
telling Inside Retail there hadn't been an internal announcement
prior to the Facebook post.
Before appointing liquidators, the company operated up to 26 stores
along the eastern seaboard which are currently closed due to the
coronavirus pandemic.
Inside Retail adds that the liquidators said they will monitor the
relevant health advice to determine if any of the stores may be
reopened after the lockdown, adding they will give updates when
further information becomes available.
Dimmeys, which specialises in discount and "no frills" merchandise,
has 31 stores across Australia listed on its website, more than
half of them in Victoria.
MACKAY CITY: Second Creditors' Meeting Set for May 12
-----------------------------------------------------
A second meeting of creditors in the proceedings of Mackay City
Couriers and Transport Pty Ltd has been set for May 12, 2020, at
11:00 a.m. at the offices of Morton's Solvency Accountants, Level
10/388 Queen Street, in Brisbane, Queensland.
The purpose of the meeting is (1) to receive the report by the
Administrator about the business, property, affairs and financial
circumstances of the Company; and (2) for the creditors of the
Company to resolve whether the Company will execute a deed of
company arrangement, the administration should end, or the Company
be wound up.
Creditors wishing to attend are advised proofs and proxies should
be submitted to the Administrator by May 11, 2020, at 4:00 p.m.
Leon Lee of Morton's Solvency Accountants was appointed as
administrator of Mackay City on March 26, 2020.
PERFUSION SOLUTIONS: Second Creditors' Meeting Set for May 8
------------------------------------------------------------
A second meeting of creditors in the proceedings of Perfusion
Solutions Pty. Ltd has been set for May 8, 2020, at 10:30 a.m. via
teleconference only.
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 May 7, 2020, at 4:00 p.m.
Jason Glenn Stone and Glenn Jeffrey Franklin of PKF Melbourne were
appointed as administrators of Perfusion Solutions on March 25,
2020.
SOUTHWEST REALTY: First Creditors' Meeting Set for May 27
---------------------------------------------------------
A first meeting of the creditors in the proceedings of Southwest
Realty Pty Ltd, trading as Raine and Horne Fairfield, will be held
on May 27, 2020, at 10:00 a.m. via telephone conference only.
Brent Kijurina and Richard Albarran of Hall Chadwick were appointed
as administrators of Southwest Realty on April 27, 2020.
STS HOLDINGS 1: Second Creditors' Meeting Set for May 8
-------------------------------------------------------
A second meeting of creditors in the proceedings of STS Holdings
No. 1 Pty Ltd and STS Operations Ltd has been set for May 8, 2020,
at 11:00 a.m. and 12:00 a.m., respectively, via teleconference
facilities only.
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 May 7, 2020, at 4:00 p.m.
Thyge Trafford Jones and Domenic Calabretta of Mackay Goodwin were
appointed as administrators of STS Holdings on Jan. 29, 2020.
VIRGIN AUSTRALIA: Bondholders in Talks With Hogan Lovells
---------------------------------------------------------
Denise Wee at Bloomberg News reports that Hogan Lovells is holding
discussions with some bondholders of distressed airline carrier
Virgin Australia, ahead of a first creditors meeting set for today,
April 30.
Virgin Australia became Asia's first airline to fall amid the
coronavirus pandemic when it was placed under voluntary
administration last week. With total debt of about AUD6.84 billion
and more than 10,000 creditors, it's one of Australia's most
high-profile debt restructurings, Bloomberg says. The carrier,
whose shareholders include Richard Branson's Virgin Group,
Singapore Airlines Ltd. and HNA Group Co., was denied a bailout by
the Australian government.
Hogan Lovells is not formally engaged, but is having discussions
with bondholders on their positions, according to Scott Harris, a
Sydney-based partner at the firm, Bloomberg relays.
A spokesman for Virgin Australia directed all questions about the
airline's restructuring to administrator Deloitte, the report says.
A representative for Deloitte said that bondholders are "a key
creditor group" and all creditors have been advised of the meeting
and are receiving updates, according to Bloomberg. He added that he
has "no doubt bondholders will be represented at the meeting."
Virgin Australia owes unsecured bondholders about AUD1.99 billion,
and those investors will be competing with employees, secured
lenders, aircraft lessors and suppliers for money, Bloomberg
discloses. Suitors for the company are said to have kicked off due
diligence.
Bloomberg notes that the recovery value for Virgin Australia's
senior unsecured debt -- which includes bondholders -- could be
about 20% to 25% in a restructuring or recapitalization, according
to an estimate by Nomura Holdings Inc. Under a liquidation, it
estimates the recovery would be around 10%.
"The various bonds have been broadly issued and significant numbers
of retail investors are thought to hold bonds in relatively small
amounts," Bloomberg quotes Mr. Harris as saying. "This could impact
on efforts to gather together sufficient holders in order to be in
a position to protect their interests."
About Virgin Australia
Brisbane, Queensland-based Virgin Australia is Australia's
second-largest airline. It commenced services in 2000 as Virgin
Blue, wholly owned by the Virgin Group.
As reported in the Troubled Company Reporter-Asia Pacific on April
22, 2020, Bloomberg News related that Virgin Australia Holdings
Ltd. became Asia's first airline to fall to the coronavirus after
the outbreak deprived the debt-burdened company of almost all
income. Administrators at Deloitte, who have taken control of the
Brisbane-based carrier, aim to restructure the business and find
new owners within months. More than 10 parties have expressed an
interest, Deloitte related on April 21.
According to Bloomberg, Virgin Australia, which has furloughed 80%
of its 10,000 workers, will continue to operate some flights for
essential workers, freight and the repatriation of Australians. The
airline's frequent flyer program is a separate company and is not
in administration.
Richard John Hughes, John Greig, Vaughan Strawbridge and Sal Algeri
of Deloitte were appointed as administrators of Virgin Australia et
al. on April 20, 2020.
VIRGIN AUSTRALIA: Velocity Rewards Pursues Carrier for AUD150MM
---------------------------------------------------------------
Adam Thorn at Australian Aviation reports that the company that
operates Velocity Frequent Flyer is to pursue Virgin Australia as a
creditor to recoup a AUD150 million loan extended in 2014.
Australian Aviation, citing the Australian Financial Review, says
Velocity Rewards will also be seeking AUD10 million worth of
pre-bought seats set aside for frequent flyer members.
It comes as administrator Deloitte is set to appoint Morgan Stanley
to oversee the airline's sale, and more details have emerged on
potential frontrunner Indigo Partners, according Australian
Aviation.
Velocity Rewards told the newspaper in a statement that it still
hopes to have a strong relationship with the airline moving
forward, but that it had a legal duty to seek the money it's owed,
adds Australian Aviation.
About Virgin Australia
Brisbane, Queensland-based Virgin Australia is Australia's
second-largest airline. It commenced services in 2000 as Virgin
Blue, wholly owned by the Virgin Group.
As reported in the Troubled Company Reporter-Asia Pacific on April
22, 2020, Bloomberg News related that Virgin Australia Holdings
Ltd. became Asia's first airline to fall to the coronavirus after
the outbreak deprived the debt-burdened company of almost all
income. Administrators at Deloitte, who have taken control of the
Brisbane-based carrier, aim to restructure the business and find
new owners within months. More than 10 parties have expressed an
interest, Deloitte related on April 21.
According to Bloomberg, Virgin Australia, which has furloughed 80%
of its 10,000 workers, will continue to operate some flights for
essential workers, freight and the repatriation of Australians. The
airline's frequent flyer program is a separate company and is not
in administration.
Richard John Hughes, John Greig, Vaughan Strawbridge and Sal Algeri
of Deloitte were appointed as administrators of Virgin Australia et
al. on April 20, 2020.
=========
I N D I A
=========
ACN TEX: CRISIL Lowers Rating on INR4.50cr Bill Loan to 'D'
-----------------------------------------------------------
CRISIL has downgraded its ratings on the bank facilities of ACN Tex
Private Limited (ACN) to 'CRISIL D/CRISIL D' from 'CRISIL
B+/Stable/CRISIL A4'. The rating downgrade reflects the delays in
the repayment of term loans on account of weak liquidity.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Bank Guarantee .35 CRISIL D (Downgraded from
'CRISIL A4')
Bill Discounting 4.50 CRISIL D (Downgraded from
'CRISIL B+/Stable')
Inland/Import .50 CRISIL D (Downgraded from
Letter of Credit 'CRISIL A4')
Packing Credit .85 CRISIL D (Downgraded from
'CRISIL A4')
Proposed Cash .75 CRISIL D (Downgraded from
Credit Limit 'CRISIL B+/Stable')
Term Loan .55 CRISIL D (Downgraded from
'CRISIL B+/Stable')
The company has delayed in the repayment of term loans on account
of weak liquidity caused by the delays in receivables.
The ratings continue to reflect ACN's small scale of operations and
exposure to intense competition in the textile industry and below
average financial risk. These strengths are partially offset by the
extensive industry experience of the promoters.
Key Rating Drivers & Detailed Description
Weakness
* Delays in debt servicing: The company has delayed the servicing
of interest and principal on its term loan due to weak liquidity on
account of delays in receivables. The interest and principal
repayments for February 2020 have not been made. Further the
working capital limits are fully utilised. The stretch in working
capital is on account of delay in payments received from the
customers.
* Small scale of operations: ACN's business risk profile remains
constrained by its small scale of operations in the intensely
competitive textile industry. The company's small scale is
indicated by its revenues of INR32 cr during fiscal 2019. Small
scale of operations prevent the company from deriving benefits of
economies of scale. In the absence of major debt funded capital
expenditure (capex), the scale is expected to remain small over the
medium term.
* Exposure to intense competition in the textile industry: The
textile industry is largely unorganized, marked by the presence of
several players with small capacities. Furthermore, because of
fragmentation and intense industry competition, players have
limited pricing and bargaining power, and consequently, low
operating margins. CRISIL believes that the intense industry
competition will continue to constrain ACNTPL's business risk
profile over the medium term.
* Below average financial risk profile: The company's financial
risk profile is below average reflected by a gearing of 1.17 times
and a modest net worth of INR1.8 cr as on March 31, 2019 The debt
protection metrics are average with interest coverage and net cash
accruals to total debt at 2.32 times and 28 percent as on March 31
2019 respectively. Due to moderate accretion to reserves and high
reliance one external bank debt, CRISIL believes that the financial
risk profile of the company is expected to remain moderate.
Strengths
* Extensive industry experience of the promoters: ACNTPL's
promoters have extensive experiences of around 3 decades in the
textile industry. ACNTPL benefits from its promoters' extensive
experience, their understanding of the dynamics of the local
market, and their established relationships with suppliers and
customers. CRISIL believes that ACNTPL will continue to benefit
from its promoters' extensive industry experience over the medium
term.
Liquidity Poor
Liquidity is weak as indicated by instances of delays in the
repayment of term loan repayments and interest. The stretch in
working capital cycle due to delay in receivables weakened
liquidity and has led to delays in servicing debt.
Rating Sensitivity factors
Upward Factors
* Track record of timely debt servicing for at least over 90 days
* Improvement in working capital cycle with Gross Current Assets
(GCA) to less than 100 days supported by improvement in collection
cycle.
Set up in 1997, the entity was promoted by Mr. Ramasamy
Venkatachalam, Ramaswamy Gounder Krishna Kumar, Kuupusamy
Periyasamy Ramasamy and Krishnakumar Loganayaki. ACNTPL's is
involved in knitting and finishing of textile for export market. It
operates from its manufacturing facility at Tirupur in Tamil Nadu.
ADI WIRES: CRISIL Maintains 'D' Debt Ratings in Not Cooperating
---------------------------------------------------------------
CRISIL said the ratings on bank facilities of Adi Wires Private
Limited (AWPL) continues to be 'CRISIL D Issuer not cooperating'.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Cash Credit 2.35 CRISIL D (ISSUER NOT
COOPERATING)
Term Loan 3.18 CRISIL D (ISSUER NOT
COOPERATING)
CRISIL has been consistently following up with AWPL for obtaining
information through letters and emails dated September 30, 2019 and
March 9, 2020 among others, apart from telephonic communication.
However, the issuer has remained non cooperative.
'The investors, lenders and all other market participants should
exercise due caution while using the rating assigned/reviewed with
the suffix 'ISSUER NOT COOPERATING'. These ratings lack a forward
looking component as it is arrived at without any management
interaction and is based on best available or limited or dated
information on the company.
Detailed Rationale
Despite repeated attempts to engage with the management, CRISIL
failed to receive any information on either the financial
performance or strategic intent of AWPL, which restricts CRISIL's
ability to take a forward looking view on the entity's credit
quality. CRISIL believes information available on AWPL is
consistent with 'Scenario 1' outlined in the 'Framework for
Assessing Consistency of Information with CRISIL BB' rating
category or lower'.
Based on the last available information, the ratings on bank
facilities of AWPL continues to be 'CRISIL D Issuer not
cooperating'.
Incorporated in 2006, Jharkhand-based AWPL manufactures binding
wires and wire nails, which are largely used in the construction
industry. The company is promoted and managed by Mr. Amit Sarawgi
and Mr. Rohit Jain.
AIR INDIA: Government Extends Deadline for Bid to June 30
---------------------------------------------------------
Livemint.com reports that the Indian government on April 28
extended the deadline to submit bid documents for Air India by two
months to June 30, given the ongoing nationwide lockdown.
Though both aviation and oil sectors have been badly hit by the
covid-19 pandemic, the finance ministry is confident it will
complete the privatization of Air India and Bharat Petroleum
Corporation Limited (BPCL) as it has the full financial year ahead,
Livemint.com relates.
Last month, the Department of Investment and Public Asset
Management (DIPAM) had extended until June 13 the last day of
submitting expressions of interests (EoI) for selling the
government's 52.98% stake in BPCL, Livemint.com recalls. This is
the second time the government extended the deadline to submit bids
for Air India. It had earlier extended the deadline to April 30
from March 17.
When asked whether the government will prefer to postpone the
privatisation of both the public sector enterprises or keep
extending the deadlines, a finance ministry official under
condition of anonymity said the government would prefer the latter,
the report relates. "There is no hurry. We have time till March 31
next year," he added.
According to the report, potential bidders may require additional
time to complete their analysis of both Air India and BPCL, said
Dipti Lavya Swain, corporate M&A lawyer & partner at HSA Advocates.
"There are valuation and market demand concerns also since the
aviation sector as well as the oil and gas sector have had high to
severe impact from covid-19. What will be important for the
government is receiving the right kind of bids which can lead to
closing the deals once the economy and market dynamics show signs
of stabilization," the report quotes Mr. Swain as saying.
Livemint.com notes that strategic disinvestment of Air India and
BPCL is crucial for the government to achieve its disinvestment
target of INR2.1 trillion for 2020-21. Livemint.com says the
government missed the disinvestment target of INR65,000 crore for
2019-20 by INR14,701 crore as it had to defer a number of offers
for sale (OFS) such as those of Coal India, Steel Authority of
India Ltd (SAIL), NMDC, Power Finance Corp, IRCON and Hindustan
Aeronautics Ltd planned towards the end of the financial year
because of the volatility in the equity market. It completed the
last deal of the financial year last week with NTPC buying
government's stakes in THDC India Ltd and North Eastern Electric
Power Corp. Ltd (NEEPCO) for INR11,500 crore.
The government in January invited preliminary bids to divest its
entire stake in Air India, and the airline's subsidiary Air India
Express along with its joint venture Air India SATS Airport
Services Private Limited, Livemint.com recalls. The successful
bidder for Air India will be required to absorb INR23,286.5 crore
of debt after the government transfers INR63,113 crore of debt from
Air India and subsidiary Air India Express ahead of the national
carrier's proposed divestment, Livemint.com relates. The government
has sweetened the offer this time around. In 2018, when the
Narendra Modi-led government had invited expressions of interest
(EoI) to divest a 76% stake in the airline, the acquirer was
required to absorb INR49,000 crore in debt, Livemint.com relays.
About Air India
Air India Ltd -- http://www.airindia.com/-- is the flag carrier
airline of India owned by Air India Limited (AIL), a Government of
India enterprise. The airline operates a fleet of Airbus and Boeing
aircraft serving various domestic and international airports. It
is headquartered at the Indian Airlines House in New Delhi.
Since the 2011-12 financial year, the government of India has
pumped more than INR300 billion into the troubled airline, whose
net losses for the year ended March 2019 reached INR85 billion, its
biggest since the 2008 financial crisis and up 59% from losses of
INR53 billion a year earlier, according to the Nikkei.
AKI INDIA: CRISIL Maintains 'B' Debt Ratings in Not Cooperating
---------------------------------------------------------------
CRISIL said the ratings on bank facilities of AKI India Limited
(AKI India) continues to be 'CRISIL B/Stable/CRISIL A4 Issuer not
cooperating'.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Cash Credit .1 CRISIL B/Stable (ISSUER NOT
COOPERATING)
Export Funding 2.4 CRISIL A4 (ISSUER NOT
COOPERATING)
Foreign Letter 4 CRISIL A4 (ISSUER NOT
of Credit COOPERATING)
Packing Credit 6 CRISIL A4 (ISSUER NOT
COOPERATING)
Post Shipment 6 CRISIL A4 (ISSUER NOT
Credit COOPERATING)
Proposed Long Term 0.5 CRISIL B/Stable (ISSUER NOT
Bank Loan Facility COOPERATING)
Term Loan 6 CRISIL B/Stable (ISSUER NOT
COOPERATING)
CRISIL has been consistently following up with AKI India for
obtaining information through letters and emails dated February 12,
2020 and March 9, 2020 among others, apart from telephonic
communication. However, the issuer has remained non cooperative.
'The investors, lenders and all other market participants should
exercise due caution while using the rating assigned/reviewed with
the suffix 'ISSUER NOT COOPERATING'. These ratings lack a forward
looking component as it is arrived at without any management
interaction and is based on best available or limited or dated
information on the company.
Detailed Rationale
Despite repeated attempts to engage with the management, CRISIL
failed to receive any information on either the financial
performance or strategic intent of AKI India, which restricts
CRISIL's ability to take a forward looking view on the entity's
credit quality. CRISIL believes information available on AKI India
is consistent with 'Scenario 1' outlined in the 'Framework for
Assessing Consistency of Information with CRISIL BB' rating
category or lower'.
Based on the last available information, the ratings on bank
facilities of AKI India continues to be 'CRISIL B/Stable/CRISIL A4
Issuer not cooperating'.
AKI India was established in 1983 and is based in Kanpur (Uttar
Pradesh). The company processes hides into finished leather and
upholstery, and also manufactures leather products such as leather
footwear and other leather goods including horse bridles,
browbands, crown pieces, pony articles and saddle girths, among
others. The company is promoted by Mr. Asad K Iraqi and Mr. Osama
Anwar.
ARJUN TECHNOLOGIES: CRISIL Keeps D Debt Ratings in Not Cooperating
------------------------------------------------------------------
CRISIL said the ratings on bank facilities of Arjun Technologies
India Limited (ATIL) continues to be 'CRISIL D/CRISIL D Issuer not
cooperating'.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Bank Guarantee 6 CRISIL D (ISSUER NOT COOPERATING)
Cash Credit 10 CRISIL D (ISSUER NOT COOPERATING)
Letter of Credit 3 CRISIL D (ISSUER NOT COOPERATING)
Long Term Loan 2.28 CRISIL D (ISSUER NOT COOPERATING)
Proposed Long Term
Bank Loan Facility 5.42 CRISIL D (ISSUER NOT COOPERATING)
Standby Line
of Credit 2 CRISIL D (ISSUER NOT COOPERATING)
CRISIL has been consistently following up with ATIL for obtaining
information through letters and emails dated September 30, 2019 and
March 9, 2020 among others, apart from telephonic communication.
However, the issuer has remained non cooperative.
'The investors, lenders and all other market participants should
exercise due caution while using the rating assigned/reviewed with
the suffix 'ISSUER NOT COOPERATING'. These ratings lack a forward
looking component as it is arrived at without any management
interaction and is based on best available or limited or dated
information on the company.
Detailed Rationale
Despite repeated attempts to engage with the management, CRISIL
failed to receive any information on either the financial
performance or strategic intent of ATIL, which restricts CRISIL's
ability to take a forward looking view on the entity's credit
quality. CRISIL believes information available on ATIL is
consistent with 'Scenario 1' outlined in the 'Framework for
Assessing Consistency of Information with CRISIL BB' rating
category or lower'.
Based on the last available information, the ratings on bank
facilities of ATIL continues to be 'CRISIL D/CRISIL D Issuer not
cooperating'.
Incorporated in 1998, and promoted by Mr P Chandrasekhar, ATIL is
an engineering and equipment turnkey system supplier for the pulp
and paper industry.
ASIATIC ENTERPRISES: CRISIL Keeps B Debt Rating in Not Cooperating
------------------------------------------------------------------
CRISIL said the ratings on bank facilities of Asiatic Enterprises
(AE) continues to be 'CRISIL B/Stable/CRISIL A4 Issuer not
cooperating'.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Cash Credit 2 CRISIL B/Stable (ISSUER NOT
COOPERATING)
Letter of Credit 8 CRISIL A4 (ISSUER NOT
COOPERATING)
CRISIL has been consistently following up with AE for obtaining
information through letters and emails dated November 30, 2019 and
March 09, 2020 among others, apart from telephonic communication.
However, the issuer has remained non cooperative.
'The investors, lenders and all other market participants should
exercise due caution while using the rating assigned/reviewed with
the suffix 'ISSUER NOT COOPERATING'. These ratings lack a forward
looking component as it is arrived at without any management
interaction and is based on best available or limited or dated
information on the company.
Detailed Rationale
Despite repeated attempts to engage with the management, CRISIL
failed to receive any information on either the financial
performance or strategic intent of AE, which restricts CRISIL's
ability to take a forward looking view on the entity's credit
quality. CRISIL believes information available on AE is consistent
with 'Scenario 1' outlined in the 'Framework for Assessing
Consistency of Information with CRISIL BB' rating category or
lower'.
Based on the last available information, the ratings on bank
facilities of AE continues to be 'CRISIL B/Stable/CRISIL A4 Issuer
not cooperating'.
Set up in 1972 as a partnership firm, AE processes and trades in
timber such as teak, paduk, and sandal wood. The firm is promoted
by Mr T G Venkatraman with his four brothers, who are the majority
shareholders and directors.
C. BRIJESH REDDY: CRISIL Keeps C Rating in Not Cooperating
----------------------------------------------------------
CRISIL said the ratings on bank facilities of C. Brijesh Reddy
(CBR) continues to be 'CRISIL C Issuer not cooperating'.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Proposed Long Term 2.5 CRISIL C (ISSUER NOT
Bank Loan Facility COOPERATING)
Term Loan 7.5 CRISIL C (ISSUER NOT
COOPERATING)
CRISIL has been consistently following up with CBR for obtaining
information through letters and emails dated September 30, 2019 and
March 9, 2020 among others, apart from telephonic communication.
However, the issuer has remained non cooperative.
'The investors, lenders and all other market participants should
exercise due caution while using the rating assigned/reviewed with
the suffix 'ISSUER NOT COOPERATING'. These ratings lack a forward
looking component as it is arrived at without any management
interaction and is based on best available or limited or dated
information on the company.
Detailed Rationale
Despite repeated attempts to engage with the management, CRISIL
failed to receive any information on either the financial
performance or strategic intent of CBR, which restricts CRISIL's
ability to take a forward looking view on the entity's credit
quality. CRISIL believes information available on CBR is consistent
with 'Scenario 1' outlined in the 'Framework for Assessing
Consistency of Information with CRISIL BB' rating category or
lower'.
Based on the last available information, the ratings on bank
facilities of CBR continues to be 'CRISIL C Issuer not
cooperating'.
Set up in 1993, C. Brijesh Reddy (CBR) is a proprietorship firm
that develops and sells plots and sites in Hosakote ( Karnataka)
and Bangalore. Operations are managed by Mr. C. Brijesh Reddy.
CHANDULAL CHANDRAKAR: CRISIL Keeps D Rating in Not Cooperating
--------------------------------------------------------------
CRISIL said the ratings on bank facilities of Chandulal Chandrakar
Memorial Hospital Private Limited (CCMHPL) continues to be 'CRISIL
D Issuer not cooperating'.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Term Loan 130 CRISIL D (ISSUER NOT COOPERATING)
CRISIL has been consistently following up with CCMHPL for obtaining
information through letters and emails dated September 30, 2019 and
March 09, 2020 among others, apart from telephonic communication.
However, the issuer has remained non cooperative.
'The investors, lenders and all other market participants should
exercise due caution while using the rating assigned/reviewed with
the suffix 'ISSUER NOT COOPERATING'. These ratings lack a forward
looking component as it is arrived at without any management
interaction and is based on best available or limited or dated
information on the company.
Detailed Rationale
Despite repeated attempts to engage with the management, CRISIL
failed to receive any information on either the financial
performance or strategic intent of CCMHPL, which restricts CRISIL's
ability to take a forward looking view on the entity's credit
quality. CRISIL believes information available on CCMHPL is
consistent with 'Scenario 1' outlined in the 'Framework for
Assessing Consistency of Information with CRISIL BB' rating
category or lower'.
Based on the last available information, the ratings on bank
facilities of CCMHPL continues to be 'CRISIL D Issuer not
cooperating'.
CCMHPL was set up in 1997 by Dr Mangal Prasad Chandrakar. It runs a
200-bed multi-speciality hospital in Bhilai and a 500-bed
hospital-cum-medical college in Durg (both in Chhattisgarh).
CINEVISTA LIMITED: CRISIL Keeps B+ Debt Ratings in Not Cooperating
------------------------------------------------------------------
CRISIL said the ratings on bank facilities of Cinevista Limited
(Cinevista) continues to be 'CRISIL B+/Stable Issuer not
cooperating'.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Cash Credit 14.5 CRISIL B+/Stable (ISSUER NOT
COOPERATING)
Proposed Cash
Credit Limit 1.5 CRISIL B+/Stable (ISSUER NOT
COOPERATING)
Term Loan 6 CRISIL B+/Stable (ISSUER NOT
COOPERATING)
CRISIL has been consistently following up with Cinevista for
obtaining information through letters and emails dated October 15,
2019 and March 9, 2020 among others, apart from telephonic
communication. However, the issuer has remained non cooperative.
'The investors, lenders and all other market participants should
exercise due caution while using the rating assigned/reviewed with
the suffix 'ISSUER NOT COOPERATING'. These ratings lack a forward
looking component as it is arrived at without any management
interaction and is based on best available or limited or dated
information on the company.
Detailed Rationale
Despite repeated attempts to engage with the management, CRISIL
failed to receive any information on either the financial
performance or strategic intent of Cinevista, which restricts
CRISIL's ability to take a forward looking view on the entity's
credit quality. CRISIL believes information available on Cinevista
is consistent with 'Scenario 1' outlined in the 'Framework for
Assessing Consistency of Information with CRISIL BB' rating
category or lower'.
Based on the last available information, the ratings on bank
facilities of Cinevista continues to be 'CRISIL B+/Stable Issuer
not cooperating'.
Cinevista, incorporated in 1993 by Mr. Prem Kishan Malhotra and Mr.
Sunil Mehta, is engaged in production of television serials and
commercial advertisements. The company currently has one serial on
air and is planning to launch 3 new serials in fiscal 2019. It also
owns a studio in Kanjurmarg, Mumbai. The company is listed on the
Bombay and National Stock Exchanges.
EAGLE HOSPITALITY: Appoints Moelis & Company as Financial Adviser
-----------------------------------------------------------------
Fiona Lam at The Business Times reports that the managers of Eagle
Hospitality Trust (EHT) on April 28 announced it has named Moelis &
Company as financial adviser as well as brought in temporary
caretakers at five closed hotels after their hotel managers left.
BT relates that the investment bank will assist the managers'
special committee and EHT's real estate investment trust (Reit)
trustee, DBS Trustee, in undertaking the strategic review of EHT's
business, including advising on available options to achieve the
best possible outcomes for the stapled security holders.
According to BT, Moelis will complement the efforts of FTI
Consulting, which was appointed last week to assist in the
restructuring process of EHT. The immediate focus of the chief
restructuring officers, who are from FTI, is to preserve the
property portfolio value and evaluate EHT's hotel management
agreements (HMAs) and the master lease agreements (MLAs). This will
include the evaluation of unpaid rent, its underlying cause and its
impact.
Formed on April 1, the special committee comprises all the
independent directors and the chief executive officer of the
manager, but excluding non-independent non-executive chairman
Howard Wu and deputy chairman Taylor Woods for reasons for
corporate governance and conflicts of interest, BT relates. Mr Wu
and Mr Woods are both co-founders and principals of EHT's sponsor
Urban Commons.
For the same reasons of corporate governance, both FTI and Moelis
will report to the special committee and DBS Trustee in respect of
their advice, the EHT managers said in a filing on April 28.
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.
ESES BIO-WEALTH: CRISIL Keeps 'D' Debt Ratings in Not Cooperating
-----------------------------------------------------------------
CRISIL said the ratings on bank facilities of ESES BIO-Wealth
Private Limited (EBPL) continues to be 'CRISIL D Issuer not
cooperating'.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Long Term Loan 8 CRISIL D (ISSUER NOT COOPERATING)
Proposed Term Loan 4 CRISIL D (ISSUER NOT COOPERATING)
CRISIL has been consistently following up with EBPL for obtaining
information through letters and emails dated September 30, 2019 and
March 9, 2020 among others, apart from telephonic communication.
However, the issuer has remained non cooperative.
'The investors, lenders and all other market participants should
exercise due caution while using the rating assigned/reviewed with
the suffix 'ISSUER NOT COOPERATING'. These ratings lack a forward
looking component as it is arrived at without any management
interaction and is based on best available or limited or dated
information on the company.
Detailed Rationale
Despite repeated attempts to engage with the management, CRISIL
failed to receive any information on either the financial
performance or strategic intent of EBPL, which restricts CRISIL's
ability to take a forward looking view on the entity's credit
quality. CRISIL believes information available on EBPL is
consistent with 'Scenario 1' outlined in the 'Framework for
Assessing Consistency of Information with CRISIL BB' rating
category or lower'.
Based on the last available information, the ratings on bank
facilities of EBPL continues to be 'CRISIL D Issuer not
cooperating'.
EBPL has set up its manufacturing facility in Morigaon district,
Assam with a capacity of 3600 tonne per annum and started its
commercial operations from April 2017 onwards.
EXCEL VINYL: CRISIL Keeps D Debt Ratings in Not Cooperating
-----------------------------------------------------------
CRISIL said the ratings on bank facilities of Excel Vinyl Coatings
Private Limited (EVCPL) continues to be 'CRISIL D/CRISIL D Issuer
not cooperating'.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Bank Guarantee 1 CRISIL D (ISSUER NOT
COOPERATING)
Cash Credit 1.4 CRISIL D (ISSUER NOT
COOPERATING)
Letter of Credit 3 CRISIL D (ISSUER NOT
COOPERATING)
Packing Credit .75 CRISIL D (ISSUER NOT
COOPERATING)
Rupee Term Loan 2.85 CRISIL D (ISSUER NOT
COOPERATING)
CRISIL has been consistently following up with EVCPL for obtaining
information through letters and emails dated
December 31, 2019 and March 09, 2020 among others, apart from
telephonic communication. However, the issuer has remained non
cooperative.
'The investors, lenders and all other market participants should
exercise due caution while using the rating assigned/reviewed with
the suffix 'ISSUER NOT COOPERATING'. These ratings lack a forward
looking component as it is arrived at without any management
interaction and is based on best available or limited or dated
information on the company.
Detailed Rationale
Despite repeated attempts to engage with the management, CRISIL
failed to receive any information on either the financial
performance or strategic intent of EVCPL, which restricts CRISIL's
ability to take a forward looking view on the entity's credit
quality. CRISIL believes information available on EVCPL is
consistent with 'Scenario 1' outlined in the 'Framework for
Assessing Consistency of Information with CRISIL BB' rating
category or lower'.
Based on the last available information, the ratings on bank
facilities of EVCPL continues to be 'CRISIL D/CRISIL D Issuer not
cooperating'.
Incorporated in 2012, EVCPL, based in Chennai, manufactures
synthetic leather. It is promoted and managed by Mr. K Natarajan.
FLAGS HOTELS: CRISIL Keeps D on INR22cr Loan in Not Cooperating
---------------------------------------------------------------
CRISIL said the ratings on bank facilities of Flags Hotels Private
Limited (FHPL) continues to be 'CRISIL D Issuer not cooperating'.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Rupee Term Loan 22 CRISIL D (ISSUER NOT COOPERATING)
CRISIL has been consistently following up with FHPL for obtaining
information through letters and emails dated September 30, 2019 and
March 9, 2020 among others, apart from telephonic communication.
However, the issuer has remained non cooperative.
'The investors, lenders and all other market participants should
exercise due caution while using the rating assigned/reviewed with
the suffix 'ISSUER NOT COOPERATING'. These ratings lack a forward
looking component as it is arrived at without any management
interaction and is based on best available or limited or dated
information on the company.
Detailed Rationale
Despite repeated attempts to engage with the management, CRISIL
failed to receive any information on either the financial
performance or strategic intent of FHPL, which restricts CRISIL's
ability to take a forward looking view on the entity's credit
quality. CRISIL believes information available on FHPL is
consistent with 'Scenario 1' outlined in the 'Framework for
Assessing Consistency of Information with CRISIL BB' rating
category or lower'.
Based on the last available information, the ratings on bank
facilities of FHPL continues to be 'CRISIL D Issuer not
cooperating'.
FHPL, incorporated in 2010, operates four restaurants and seven
banquet halls in Mumbai under the Flags brand. It is managed by Mr.
Joseph Sequeira, Mr. Larence Sequeira, and Ms. Catherine Dsouza.
GALFAN ENGINEERS: CRISIL Keeps B Debt Ratings in Not Cooperating
----------------------------------------------------------------
CRISIL said the ratings on bank facilities of Galfan Engineers
Private Limited (GEPL) continues to be 'CRISIL B/Stable Issuer not
cooperating'.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Cash Credit 3 CRISIL B/Stable (ISSUER NOT
COOPERATING)
Proposed Long Term 4 CRISIL B/Stable (ISSUER NOT
Bank Loan Facility COOPERATING)
Proposed Long Term 4 CRISIL B/Stable (ISSUER NOT
Bank Loan Facility COOPERATING)
CRISIL has been consistently following up with GEPL for obtaining
information through letters and emails dated September 30, 2019 and
March 9, 2020 among others, apart from telephonic communication.
However, the issuer has remained non cooperative.
'The investors, lenders and all other market participants should
exercise due caution while using the rating assigned/reviewed with
the suffix 'ISSUER NOT COOPERATING'. These ratings lack a forward
looking component as it is arrived at without any management
interaction and is based on best available or limited or dated
information on the company.
Detailed Rationale
Despite repeated attempts to engage with the management, CRISIL
failed to receive any information on either the financial
performance or strategic intent of GEPL, which restricts CRISIL's
ability to take a forward looking view on the entity's credit
quality. CRISIL believes information available on GEPL is
consistent with 'Scenario 1' outlined in the 'Framework for
Assessing Consistency of Information with CRISIL BB' rating
category or lower'.
Based on the last available information, the ratings on bank
facilities of GEPL continues to be 'CRISIL B/Stable Issuer not
cooperating'.
Incorporated in 1985 in Chennai and promoted by Mr Shakti Mohan,
GEPL manufactures electro forged and manual gratings.
GOKUL STEELS: CRISIL Maintains 'D' Debt Ratings in Not Cooperating
------------------------------------------------------------------
CRISIL said the ratings on bank facilities of Gokul Steels Private
Limited (GSPL) continues to be 'CRISIL D Issuer not cooperating'.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Cash Credit 6.5 CRISIL D (ISSUER NOT
COOPERATING)
Proposed Long Term 3.05 CRISIL D (ISSUER NOT
Bank Loan Facility COOPERATING)
Term Loan 6.45 CRISIL D (ISSUER NOT
COOPERATING)
CRISIL has been consistently following up with GSPL for obtaining
information through letters and emails dated September 30, 2019 and
March 9, 2020 among others, apart from telephonic communication.
However, the issuer has remained non cooperative.
'The investors, lenders and all other market participants should
exercise due caution while using the rating assigned/reviewed with
the suffix 'ISSUER NOT COOPERATING'. These ratings lack a forward
looking component as it is arrived at without any management
interaction and is based on best available or limited or dated
information on the company.
Detailed Rationale
Despite repeated attempts to engage with the management, CRISIL
failed to receive any information on either the financial
performance or strategic intent of GSPL, which restricts CRISIL's
ability to take a forward looking view on the entity's credit
quality. CRISIL believes information available on GSPL is
consistent with 'Scenario 1' outlined in the 'Framework for
Assessing Consistency of Information with CRISIL BB' rating
category or lower'.
Based on the last available information, the ratings on bank
facilities of GSPL continues to be 'CRISIL D Issuer not
cooperating'.
GSPL, promoted by the Bihar-based Mr. Vivek Kasera, recently set up
a steel structural rolling mill in Fatwa, Patna District. The mill
commenced operations in May 2014. The Kasera family does not have
any prior experience of operating a rolling mill. However, the
family has extensive experience of over two decades in trading in
iron and steel product.
HARI OM RICE: CRISIL Keeps D on INR20cr Credit in Not Cooperating
-----------------------------------------------------------------
CRISIL said the ratings on bank facilities of Hari Om Rice Mill
Private Limited (HRMPL) continues to be 'CRISIL D Issuer not
cooperating'.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Cash Credit 20 CRISIL D (ISSUER NOT
COOPERATING)
CRISIL has been consistently following up with HRMPL for obtaining
information through letters and emails dated September 30, 2019 and
March 09, 2020 among others, apart from telephonic communication.
However, the issuer has remained non cooperative.
'The investors, lenders and all other market participants should
exercise due caution while using the rating assigned/reviewed with
the suffix 'ISSUER NOT COOPERATING'. These ratings lack a forward
looking component as it is arrived at without any management
interaction and is based on best available or limited or dated
information on the company.
Detailed Rationale
Despite repeated attempts to engage with the management, CRISIL
failed to receive any information on either the financial
performance or strategic intent of HRMPL, which restricts CRISIL's
ability to take a forward looking view on the entity's credit
quality. CRISIL believes information available on HRMPL is
consistent with 'Scenario 1' outlined in the 'Framework for
Assessing Consistency of Information with CRISIL BB' rating
category or lower'.
Based on the last available information, the ratings on bank
facilities of HRMPL continues to be 'CRISIL D Issuer not
cooperating'.
Chhattisgarh-based HRMPL, incorporated in 2006, mills and
manufactures non-basmati rice. Mr Subhash Aggarwal is the
promoter.
HARIOM COTGIN: CRISIL Keeps D on INR8cr Credit in Not Cooperating
-----------------------------------------------------------------
CRISIL said the ratings on bank facilities of Hariom Cotgin Private
Limited (HCPL) continues to be 'CRISIL D Issuer not cooperating'.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Cash Credit 8 CRISIL D (ISSUER NOT
COOPERATING)
CRISIL has been consistently following up with HCPL for obtaining
information through letters and emails dated September 30, 2019 and
March 9, 2020 among others, apart from telephonic communication.
However, the issuer has remained non cooperative.
'The investors, lenders and all other market participants should
exercise due caution while using the rating assigned/reviewed with
the suffix 'ISSUER NOT COOPERATING'. These ratings lack a forward
looking component as it is arrived at without any management
interaction and is based on best available or limited or dated
information on the company.
Detailed Rationale
Despite repeated attempts to engage with the management, CRISIL
failed to receive any information on either the financial
performance or strategic intent of HCPL, which restricts CRISIL's
ability to take a forward looking view on the entity's credit
quality. CRISIL believes information available on HCPL is
consistent with 'Scenario 1' outlined in the 'Framework for
Assessing Consistency of Information with CRISIL BB' rating
category or lower'.
Based on the last available information, the ratings on bank
facilities of HCPL continues to be 'CRISIL D Issuer not
cooperating'.
HCPL, incorporated in 2008 by Mr. Ramesh, gins cotton, and presses
and processes cotton seed into oil and cakes. In October 2015, it
was taken over by Mr. Bharatbhain Selani and Mr. Chiragbhai Selani,
who have been in the cotton ginning and pressing business for five
decades.
HAZARILAL COLD: CRISIL Reaffirms B+ Rating on INR4.91cr Loan
------------------------------------------------------------
CRISIL has reaffirmed its 'CRISIL B+/Stable' rating on long-term
bank facilities of Shree Hazarilal Cold Storage Pvt Ltd (SHCSPL;
part of the Somnath group).
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Cash Credit 4.91 CRISIL B+/Stable (Reaffirmed)
Proposed Long Term
Bank Loan Facility 3.13 CRISIL B+/Stable (Reaffirmed)
Working Capital Loan .96 CRISIL B+/Stable (Reaffirmed)
The rating continue to reflect the group's weak financial risk
profile, exposure to risks relating to unfavourable regulations and
intense competition in the cold storage industry in West Bengal
(WB) and vulnerability to delay in payments by farmers because of
adverse market conditions. These weaknesses are partially offset by
promoters' extensive experience.
Analytical Approach
For arriving at its ratings, CRISIL has combined the business and
financial risk profiles of Somnath Cold Storage Pvt Ltd (SCSPL),
Chinsurah Cold Storage - Bansidhar Agarwalla and Co Pvt Ltd (CCS),
SHCSPL, and Himghar Udyog Pvt Ltd (HUPL). All the entities,
collectively referred to as the Somnath group, have common
management and business, and operational linkages.
Also, CRISIL has treated unsecured loans of INR4.75 crore (as on
March 31, 2019) from the promoters and their relatives as neither
debt nor equity as these loans will remain in the business over the
medium term.
Key Rating Drivers & Detailed Description
Weaknesses:
* Exposure to regulatory risks and to intense competition: The
potato cold storage industry in WB is regulated by the West Bengal
Cold Storage Association. The rental rates are fixed by the state
department of agricultural marketing, which limits players' ability
to earn profit based on their strengths and geographical
advantages. Pressure to offer discounts to ensure healthy
utilisation of storage capacity, especially given the intense
competition, will continue to constrain profitability.
* Weak financial risk profile: Networth was small at INR9.6 crore
as on March 31, 2019, despite marginal improvement in recent years
on account of accretion to reserves. Gearing was high at 5.5 times
due to loans extended to farmers and term debt contracted. Debt
protection metrics are likely to remain modest over the medium
term: interest coverage and net cash accrual to total debt ratios
were 1.5 times and 0.06 time, respectively, in fiscal 2019.
* Vulnerability to delay in payments by farmers because of adverse
market conditions: Cold storages contract debt from banks, backed
by the Government of West Bengal's initiative to support
agriculture, and extend it to farmers as financial assistance.
Repayment of loans depends on timely realisation of payments by the
farmers, but the primary responsibility to service loans lies with
cold storages. However, payments are often stretched. In case of
adverse market conditions, when agricultural commodity prices fall
significantly, farmers do not lift their stock to save on rental
charges and tend to default on loans, which puts pressure on the
profitability of cold storages. Consequently, cold storages have
cash flow mismatches and bank liabilities. Though the group has not
faced any such issue in the recent past, it is vulnerable to
downturns given its presence in the agricultural industry.
Strength:
* Promoters' extensive industry experience: The promoters'
presence of over five decades in the cold storage business and
their sustained strong relationships with potato farmers in WB have
ensured healthy utilisation of storage capacity. However, with the
advent of Novel Coronavirus in fiscal 2020, utilisation has been
lower.
Liquidity Poor
Liquidity is marked by cash accrual of around INR1.5 crore was just
sufficient to meet debt obligation of around INR1 crore in fiscal
2019. Accrual is expected to remain stable over the medium term,
backed by healthy profitability. However, bank limit remained
almost fully utilised. Current ratio was moderate at around 1.2
times as on March 31, 2019.
Outlook: Stable
CRISIL believes the Somnath group will continue to benefit from the
extensive industry experience of its promoters.
Rating Sensitivity factors
Upward factors
* Increase in rental rates with optimum capacity utilisation
leading to rise in revenue, along with sustenance of operating
margin over 30%
* Improvement in liquidity, supported by better cash accrual
Downward factors
* Decline in rental rates and lower capacity utilisation adversely
affecting business risk profile
* Delays in payment by farmers
* Deterioration in interest coverage ratio to less than 1 time
The Somnath group, promoted by Kolkata-based Agarwal family, has
been providing cold storage facilities to potato farmers and
traders since 1963. The group comprises SCSPL (incorporated in
1984), CCS (1963), HUPL (1986), and SHCSPL (2003). The companies
have cold storage facilities in Hooghly, Burdwan, Bankura, and
Jalpaiguri (all in WB).
INDO LAMINATES: CRISIL Keeps 'D' Debt Ratings in Not Cooperating
----------------------------------------------------------------
CRISIL said the ratings on bank facilities of Indo Laminates
Private Limited (ILPL) continues to be 'CRISIL D/CRISIL D Issuer
not cooperating'.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Cash Credit 15 CRISIL D (ISSUER NOT COOPERATING)
Letter of Credit 5 CRISIL D (ISSUER NOT COOPERATING)
Term Loan 9 CRISIL D (ISSUER NOT COOPERATING)
CRISIL has been consistently following up with ILPL for obtaining
information through letters and emails dated October 15, 2019 and
March 9, 2020 among others, apart from telephonic communication.
However, the issuer has remained non cooperative.
'The investors, lenders and all other market participants should
exercise due caution while using the rating assigned/reviewed with
the suffix 'ISSUER NOT COOPERATING'. These ratings lack a forward
looking component as it is arrived at without any management
interaction and is based on best available or limited or dated
information on the company.
Detailed Rationale
Despite repeated attempts to engage with the management, CRISIL
failed to receive any information on either the financial
performance or strategic intent of ILPL, which restricts CRISIL's
ability to take a forward looking view on the entity's credit
quality. CRISIL believes information available on ILPL is
consistent with 'Scenario 1' outlined in the 'Framework for
Assessing Consistency of Information with CRISIL BB' rating
category or lower'.
Based on the last available information, the ratings on bank
facilities of ILPL continues to be 'CRISIL D/CRISIL D Issuer not
cooperating'.
Established in 1985, ILPL manufactures laminates. It is based in
Delhi and its plant is in Bahadurgarh, Haryana. Its daily
operations are managed by Mr Rahul Goyal and Mr Subhash Goyal.
INDO SILICON: CRISIL Keeps B on INR6.5cr Credit in Not Cooperating
------------------------------------------------------------------
CRISIL said the ratings on bank facilities of Indo Silicon
Electronics Private Limited (ISPL) continues to be 'CRISIL B/Stable
Issuer not cooperating'.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Cash Credit 6.5 CRISIL B/Stable (ISSUER NOT
COOPERATING)
CRISIL has been consistently following up with ISPL for obtaining
information through letters and emails dated September 30, 2019 and
March 9, 2020 among others, apart from telephonic communication.
However, the issuer has remained non cooperative.
'The investors, lenders and all other market participants should
exercise due caution while using the rating assigned/reviewed with
the suffix 'ISSUER NOT COOPERATING'. These ratings lack a forward
looking component as it is arrived at without any management
interaction and is based on best available or limited or dated
information on the company.
Detailed Rationale
Despite repeated attempts to engage with the management, CRISIL
failed to receive any information on either the financial
performance or strategic intent of ISPL, which restricts CRISIL's
ability to take a forward looking view on the entity's credit
quality. CRISIL believes information available on ISPL is
consistent with 'Scenario 1' outlined in the 'Framework for
Assessing Consistency of Information with CRISIL BB' rating
category or lower'.
Based on the last available information, the ratings on bank
facilities of ISPL continues to be 'CRISIL B/Stable Issuer not
cooperating'.
ISPL was incorporated in 1999, by Delhi-based Chadha family. ISPL
earlier imported car accessories, and changed its line of business
in 2005. It now trades in passenger car radials, light truck tyres,
and bike tyres. Mr Harminder Singh Chadha, one of its directors,
manages the operations.
KANS WEDDING: CRISIL Lowers Rating on INR8.6cr Loan to 'D'
----------------------------------------------------------
CRISIL has downgraded its ratings on the bank facilities of Kans
Wedding Centre (KWC) to 'CRISIL D Issuer Not Cooperating' from
'CRISIL B+/Stable Issuer Not Cooperating'.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Cash Credit 8.6 CRISIL D (ISSUER NOT
COOPERATING; Downgraded from
'CRISIL B+/Stable ISSUER NOT
COOPERATING')
Long Term Loan 1.22 CRISIL D (ISSUER NOT
COOPERATING; Downgraded from
'CRISIL B+/Stable ISSUER NOT
COOPERATING')
Proposed Working .18 CRISIL D (ISSUER NOT
Capital Facility COOPERATING; Downgraded from
'CRISIL B+/Stable ISSUER NOT
COOPERATING')
CRISIL has been consistently following up with KWC for obtaining
information through letters and emails ated April 23, 2019 and
October 11, 2019 among others, apart from telephonic communication.
However, the issuer has remained non cooperative.
'The investors, lenders and all other market participants should
exercise due caution while using the rating assigned/reviewed with
the suffix 'ISSUER NOT COOPERATING'. These ratings lack a forward
looking component as it is arrived at without any management
interaction and is based on best available or limited or dated
information on the firm'.
Detailed Rationale
Despite repeated attempts to engage with the management, CRISIL
failed to receive any information on either the financial
performance or strategic intent of KWC, which restricts CRISIL's
ability to take a forward looking view on the entity's credit
quality. CRISIL believes information available on Western Lumbers
is consistent with 'Scenario 1' outlined in the 'Framework for
Assessing Consistency of Information with CRISIL BB' rating
category or lower'.
Due to delay in timely repayment of debt, CRISIL has downgraded its
ratings on the bank facilities of KWC to 'CRISIL D Issuer Not
Cooperating' from 'CRISIL B+/Stable Issuer Not Cooperating'.
KWC, incorporated in 2009, is promoted Mr K A Niyas and his family,
who have been in this line of business for over two decades. It is
Kerala's largest wedding apparel retail firm, offering over 10,000
branded products. The firm has three operational retail stores in
Kerala.
KARVY DATA: CRISIL Reaffirms 'D' Rating on INR190cr Cash Loan
-------------------------------------------------------------
CRISIL has reaffirmed its 'CRISIL D/CRISIL D' ratings on the bank
facilities and non-convertible debentures of Karvy Data Management
Services Limited (KDMSL; part of the KDMSL group). CRISIL has also
withdrawn its rating on the INR978 crore proposed non-convertible
debentures (NCDs) (See Annexure - Details of Rating Withdrawn) and
proposed long term bank loan facility of INR162.81 crore at the
company's request. The rating action is in line with CRISIL's
policy of Withdrawal of ratings on bank facilities and NCDs.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Cash Credit 190 CRISIL D (Reaffirmed)
Letter of credit
& Bank Guarantee 105 CRISIL D (Reaffirmed)
Long Term Loan 152.19 CRISIL D (Reaffirmed)
Overdraft 90 CRISIL D (Reaffirmed)
Proposed Long Term
Bank Loan Facility 162.81 CRISIL D (Withdrawn)
The ratings continue to reflect its large working capital
requirement and a below-average financial risk profile. These
weaknesses are partially offset by KDMSL's diversified revenue
profile.
Analytical Approach
For arriving at the ratings, CRISIL has taken a consolidated view
of KDMSL and its subsidiaries, Karvy Forde Search Pvt Ltd (Forde),
Karvy DigiKonnect Ltd (KDK), Karvy Innotech Ltd (KITL), Sciknow
Techno Solutions Ltd (STSL), Karvy Next Ltd (KNL), and Karvy
Renewable Energy Projects Ltd (KREPL). That's because of
operational synergies and inter-party transactions between these
entities, collectively referred to as the KDMSL group, common
management, and fungible cash flows. KDMSL has extended a letter of
comfort backing the bank lines of KREPL, STSL and Forde, and a
corporate guarantee for KDK.
Key Rating Drivers & Detailed Description
* Delay in debt repayment: Stretch in receivables along with
significant delay in fund raising plan has constrained the cash
flow of KDMSL resulting in delays in term loan and NCD coupon
payments.
Weaknesses:
* Large working capital requirement: Gross current assets were 238
days as on March 31, 2019, driven mainly by debtors of 150 days.
Moreover, debtors are expected to stretch further in fiscal 2020 to
over 175 days. Operations are likely to remain working capital
intensive.
* Below-average financial risk profile: The financial risk profile
may continue to be constrained by large debt. The gearing was high
at over 2.5 times, despite a comfortable networth of INR295 crore,
as on March 31, 2019. Debt protection metrics were subdued, with
interest coverage and net cash accrual to total debt ratios of 2.46
times and 0.18 time, respectively, in fiscal 2019. The interest
coverage ratio is projected at 2.0-2.5 times over the medium term.
Strength:
* Diversified revenue profile: The KDMSL group has a presence in
various business verticals such as e-governance, telecommunication
(telecom), and banking.
Liquidity Poor
Liquidity is poor as indicated by delays in repayment of term debt
and NCD coupon payment.
Rating Sensitivity factors
Upward factors
* Track record of timely debt servicing for at least 90 days
* Significant improvement in operating performance, resulting in
healthy net cash accrual and a stronger financial risk profile
About the KDMSL group
KDMSL, incorporated in 2008, is a Hyderabad-based step-down
subsidiary of KSBL. KDMSL provides business and knowledge process
services; it started off as a pure-play back-office service
provider and added other verticals such as e-governance, banking,
telecom, and e-commerce. The company is an established player in
government mandates such as UIDAI's Aadhar, PAN card, NPR
Biometric, and E-TDS. It has established working relationships with
several key government departments and enjoys strong support from
KSBL.
About KSBL
KSBL is a part of the Hyderabad-based Karvy group of companies. The
key promoters of the group are Mr C Parthasarathy, Mr M S
Ramakrishna, and Mr M Yugandhar. KSBL undertakes equity broking,
depository operations, and distribution of financial products; and
provides advisory services and wealth management.
KARVY DIGIKONNECT: CRISIL Reaffirms 'C' Ratings on INR65cr Loans
----------------------------------------------------------------
CRISIL has reaffirmed its 'CRISIL C'' rating on the long-term bank
facilities of Karvy DigiKonnect Limited (KDK; a part of the Karvy
Data Management Services Ltd (KDMSL) group). CRISIL has also
withdrawn its rating on the INR100 crore proposed non-convertible
debentures (NCDs) and proposed long term bank loan facility of
INR40 crore at the company's request. The rating action is in line
with CRISIL's policy of Withdrawal of ratings on bank facilities
and NCDs.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Cash Credit 20 CRISIL C (Reaffirmed)
Proposed Long Term
Bank Loan Facility 40 CRISIL C (Withdrawn)
Term Loan 5 CRISIL C (Reaffirmed)
The rating also reflects KDK's susceptibility to employee attrition
and competitive pressure from established players. These weaknesses
are partially offset by its moderate financial risk profile.
Analytical Approach
For arriving at the rating, CRISIL has taken a consolidated view of
KDK, along with its subsidiary Digicall Global Pvt Ltd (DGPL). This
is because of operational synergies and inter-party transactions
between these companies, operations handled by a common management,
and fungible cash flows.
Key Rating Drivers & Detailed Description
Weakness:
* Susceptibility to employee attrition: KDK's operations are
susceptible to high employee attrition rate. Most of the expenses
are fixed-cost in nature (employee costs and rentals), making it
vulnerable to the quantum of work received, and subsequently, the
level of billing. To manage employee attrition, KDK needs to reward
employees with satisfactory yearly increment, and performance
incentives.
* Competitive pressure from established players: This industry is
highly fragmented, marked by the presence of numerous small
players, which have regional presence and offer the same services
at low costs. Besides, large customers have regional contracts with
the bulk of the business being served by small players. This
results in pricing pressure on players such as KDK, which have to
incur high overheads to maintain quality.
Strength:
* Above-average financial risk profile: Financial risk profile
continues to remain above-average marked by a moderate networth
though constrained by high gearing. Net worth was moderate at Rs.
37 crore while the capital structure was leveraged marked by high
gearing of 2.9 times on March 31, 2019. Interest coverage and net
cash accrual to total debt ratios were about 1.67 times and 0.12
time respectively in fiscal 2019.
Liquidity Poor
Liquidity is expected to remain under pressure as the company
remains dependent on the extent and timeliness of fund support from
KDMSL. However, KDMSL's liquidity is also poor and the company had
defaulted on its term debt obligations.
Rating Sensitivity factors
Upward factors
* Revenue growth of over 15% and sustenance of operating margin at
current levels
* Improvement in credit risk profile of KDMSL
Downward factors
* Any large unanticipated debt funded capital expenditure or
stretch in working capital cycle weakening the financial risk
profile
* Delay in debt servicing by KDK
About KDK
KDK, incorporated in 1994, provides a complete range of inbound,
outbound, and back-office service solutions across multiple domains
and industry verticals, such as telecom, banking, financial
services, and insurance, retail, travel, hospitality, and
healthcare.
DGPL, wholly owned by KDK, is an international call centre that
provides inbound and outbound support to its clients.
About KDMSL
Incorporated in 2008, Hyderabad-based KDMSL is a stepdown
subsidiary of KSBL. It provides business and knowledge process
services. The company started off as a pure-play back office
service provider and went on to add other verticals, such as
e-governance, banking, telecom, and e-commerce. The company is an
established player for government mandates such as Aadhar, PAN
card, National Population Register, and e-tax deducted at source.
It has strong relationship with several key government departments
and enjoys support from the KDSML group.
KARVY RENEWABLE: CRISIL Reaffirms 'C' Rating on INR12.15cr Loan
---------------------------------------------------------------
CRISIL has reaffirmed its 'CRISIL C' rating on the long-term bank
facility of Karvy Renewable Energy Projects Limited (KREPL, a part
of the Karvy Data Management Services Ltd (KDMSL) group). CRISIL
has also withdrawn its rating on proposed long term bank facility
of INR2.85 crore at the company's request. The rating is withdrawn
in line with CRISIL's policy.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Long Term Loan 12.15 CRISIL C (Reaffirmed)
Proposed Long Term
Bank Loan Facility 2.85 CRISIL C (Withdrawn)
The rating reflects KREPL's limited track record of operations and
its below-average financial risk profile. These weaknesses are
partially offset by the extensive experience of the promoters.
Key Rating Drivers & Detailed Description
Weaknesses:
* Limited track record of operations: KREPL has limited track
record as a developer and operator of rooftop solar power plants.
Scale of operations remained modest, with revenue of 3.72 crore in
fiscal 2019.
* Below-average financial risk profile: Financial risk profile is
constrained by modest networth of INR6 crore, which limits the
company's financial flexibility and the ability to undertake larger
projects.
Strength:
* Experience of the promoters: KREPL is a subsidiary of KDMSL and
benefits from the extensive experience of its promoters.
Liquidity Poor
Liquidity is expected to remain under pressure as the company
remains dependent on the extent and timeliness of fund support from
KDMSL. However, KDMSL's liquidity is also poor and the company had
defaulted on its term debt obligations as well as NCD payments.
Rating Sensitivity factors
Upward factors:
* Sustained growth in revenue and profitability leading accrual
increasing to INR2 crore over the medium term
* Improvement in the credit risk profile of KDMSL
Downward factors
* Any large unanticipated debt funded capital expenditure or
stretch in working capital cycle weakening the financial risk
profile
* Delay in debt servicing by KREPL
Incorporated in 2016, Hyderabad-based KREPL provides EPC solutions
for solar projects.
Incorporated in 2008, KDMSL, headquartered in Hyderabad, is a
step-down subsidiary of Karvy Stock Broking Ltd (KSBL). It provides
business and knowledge process services. The company started off as
a pure-play back office service provider and added other verticals,
such as e-governance, banking, telecom, and e-commerce. The company
is a strong player in government mandates, such as UIDAI's Aadhaar,
PAN card, NPR Biometric, and E-TDS. It has established healthy
working relationships with several key government departments and
enjoys strong support from the Karvy group.
MOHITE INDUSTRIES: CRISIL Cuts Rating on INR31cr Loan to B+
-----------------------------------------------------------
CRISIL said the ratings on bank facilities of Mohite Industries
Limited (MIL) revised to 'CRISIL B+/Stable/CRISIL A4 Issuer not
cooperating'.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Bank Guarantee 3.31 CRISIL A4 (ISSUER NOT
COOPERATING; Revised from
'CRISIL A4+ ISSUER NOT
COOPERATING')
Cash Credit 31 CRISIL B+/Stable (ISSUER NOT
COOPERATING; Revised from
'CRISIL BB/Stable ISSUER NOT
COOPERATING')
CRISIL has been consistently following up with MIL for obtaining
information through letters and emails dated October 15, 2019 and
March 09, 2020 among others, apart from telephonic communication.
However, the issuer has remained non cooperative.
'The investors, lenders and all other market participants should
exercise due caution while using the rating assigned/reviewed with
the suffix 'ISSUER NOT COOPERATING'. These ratings lack a forward
looking component as it is arrived at without any management
interaction and is based on best available or limited or dated
information on the company.
Detailed Rationale
Despite repeated attempts to engage with the management, CRISIL
failed to receive any information on either the financial
performance or strategic intent of MIL, which restricts CRISIL's
ability to take a forward looking view on the entity's credit
quality. CRISIL believes information available on MIL is consistent
with 'Scenario 4' outlined in the 'Framework for Assessing
Consistency of Information'.
Based on the last available information, the ratings on bank
facilities of MIL revised to 'CRISIL B+/Stable/CRISIL A4 Issuer not
cooperating'.
MIL is a Kolhapur-based cotton spinning company with capacity of
36,000 spindles. The company, incorporated in 1991, has a captive
10 megawatt hydropower plant. Mr. Shivaji Mohite is the promoter,
Chairman and Managing Director.
PROMAS ENGINEERS: CRISIL Reaffirms B+ Rating on INR10cr Loan
------------------------------------------------------------
CRISIL has reaffirmed its 'CRISIL B+/Stable/CRISIL A4' ratings on
the bank facilities of Promas Engineers Private Limited (PEPL).
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Cash Credit 10 CRISIL B+/Stable (Reaffirmed)
Letter Of Guarantee 2 CRISIL A4 (Reaffirmed)
Proposed Long Term
Bank Loan Facility 3 CRISIL B+/Stable (Reaffirmed)
CRISIL has taken cognizance of the restrictions on economic
activity, including closure of all non-essential manufacturing
plants, due to the spread of Novel Coronavirus (Covid-19). This
will impact the company's performance in fiscal 2021 as against
CRISIL's earlier expectations. Impact of Covid-19 related
restrictions applicable post May 03, 2020 will remain a key
monitorable.
The ratings continue to reflect the modest scale of PEPL's
operations in the intensely competitive equipment manufacturing
industry, a below-average financial risk profile, and large working
capital requirement. These weaknesses are partially offset by the
extensive experience of the promoter and his funding support.
Analytical Approach
Unsecured loan, outstanding at INR1.83 crore as on March 31, 2019,
extended by the promoters has been treated as neither debt nor
equity. That is because this loan is subordinate to bank debt and
is likely to remain in the business over the medium term.
Key Rating Drivers & Detailed Description
Weaknesses
* Modest scale of operations amid intense competition: The
equipment manufacturing industry comprised numerous organised and
unorganised players; the consequent intense competition may
continue to constrain scalability, pricing power and profitability.
Thus, revenue was low at INR16.19 crore in fiscal 2019 and is
estimated at INR20 crore in fiscal 2020. Revenue growth is expected
to remain muted in fiscal 2021 as well, driven by the impact of the
Novel Coronavirus and the subsequent lockdown; prolonged lockdown
will also restrict efficient order execution. Faster turnaround to
normalcy would at least partially limit the overall effect on the
business.
* Below-average financial risk profile: The financial risk profile
has been weak and may continue to be so owing to large working
capital debt. Networth was significantly low at INR0.31 crore as on
March 31, 2019 and estimated at around 1.05 crore in fiscal 2020,
with gearing extensively high at 38.00 times in fiscal 2019 and
estimated to remain high at around 11.5 times in fiscal 2020. Debt
protection metrics were also muted, with interest coverage and net
cash accrual to total debt ratios at 1.92 times and 0.08 time,
respectively, for fiscal 2019.
* Large working capital requirement: The working capital cycle has
been stretched and may remain so even over the medium term; hence,
its management will be closely monitored. Gross current assets were
substantial at 344 days as on March 31, 2019, driven by huge
inventory and sizeable receivables of 227 days and 105 days,
respectively. The working capital is managed by extending payments
to suppliers (creditors extended by suppliers stood at 205 days),
and by availing of working capital debt.
Strength
* Extensive experience of the promoter and his funding support:
Benefits from the promoter's experience of over a decade, his
strong understanding of local market dynamics, healthy relations
with suppliers and customers, and his timely, need-based funding
support should continue to aid the business.
Liquidity Stretched
Liquidity has been stretched and may remain so going forward as
well. Cash accrual (Rs 1.08 crore in fiscal 2019) is expected at
INR0.9-1.1 crore per annum over the medium term, barely sufficient
to meet the yearly maturing debt of INR2.0-4.0 lakh. Thus, bank
limit utilisation was high and averaged 98% during the 12 months
through February 2020. However, liquidity is likely to remain
supported by the timely, need-based funds extended by the
promoter.
Outlook: Stable
CRISIL believes PEPL will continue to benefit from the experience
of the promoter.
Rating Sensitivity Factors
Upward Factors
* Steady revenue growth of 20% per annum, with stable
profitability
* Improvement in working capital cycle
Downward Factors
* Revenue declining by 15% than expectations and decline in
profitability
* Stretch in the working capital cycle.
PEPL, incorporated in 2003 by Mr B B Gatkal, is a Mumbai-based
company that manufactures industrial equipment used in the
pharmaceutical, chemical, and food-processing industries.
R.A. MOTORS: CRISIL Lowers Rating on INR10cr Loan to 'D'
--------------------------------------------------------
CRISIL has downgraded its rating on R.A. Motors Private Limited
(RAMPL) to 'CRISIL D Issuer Not Cooperating' from 'CRISIL B+/Stable
Issuer Not Cooperating', as after factoring that the company has
delayed honouring invoice payment in the month of March, 2020.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Cash Credit 7.5 CRISIL D (ISSUER NOT
COOPERATING; Downgraded from
'CRISIL B+/Stable ISSUER NOT
COOPERATING')
Channel Financing 9.5 CRISIL D (ISSUER NOT
COOPERATING; Downgraded from
'CRISIL B+/Stable ISSUER NOT
COOPERATING')
Corporate Loan 3 CRISIL D (ISSUER NOT
COOPERATING; Downgraded from
'CRISIL B+/Stable ISSUER NOT
COOPERATING')
Electronic Dealer 10 CRISIL D (ISSUER NOT
Financing Scheme COOPERATING; Downgraded from
(e-DFS) 'CRISIL B+/Stable ISSUER NOT
COOPERATING')
CRISIL has been consistently following up with RAMPL and has sought
information via letters and emails dated December 31, 2019 and
February 19, 2020, among others, apart from telephonic
communication. However, the issuer has remained non-cooperative.
'The investors, lenders and all other market participants should
exercise due caution while using the rating assigned/reviewed with
the suffix 'ISSUER NOT COOPERATING'. These ratings lack a
forward-looking component, as they have been arrived at without any
management interaction, and are based on the best available,
limited or dated information on the company'.
Detailed Rationale
Despite repeated attempts to engage with the management, CRISIL has
not obtained any information on either the financial performance or
strategic intent of RAMPL. This restricts CRISIL's ability to take
a forward-looking view on the entity's credit quality. CRISIL
believes information available for the company is consistent with
'Scenario 1' outlined in the 'Framework for Assessing Consistency
of Information with 'CRISIL BB' rating category or lower.'
Based on the best available information, CRISIL has downgraded its
rating to 'CRISIL D Issuer Not Cooperating' from 'CRISIL B+/Stable
Issuer Not Cooperating', as after factoring that the company has
delayed honouring invoice payment in the month of March, 2020.
RAMPL, incorporated in 2004, is an authorised dealer for TML's CVs
with four showrooms and nine sales offices covering Etah,
Moradabad, Badaun, Kasganj, Sambhal, Amroha, and Bareilly, in Uttar
Pradesh. The Etah--based company deals in the entire range of TML's
commercial as well as passenger vehicles. Mr Ajay Chaturvedi is the
promoter.
ROHINI METALS: CRISIL Hikes Rating on INR5cr Cash Loan to B-
------------------------------------------------------------
CRISIL has revised its ratings on the bank facilities of Rohini
Metals Industries (RMI) to 'CRISIL D' from 'CRISIL B+/Stable'.
Also, the rating has been simultaneously upgraded to 'CRISIL
B-/Stable'.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Cash Credit 5 CRISIL B-/Stable (Revised from
'CRISIL B+/Stable' to 'CRISIL D'
and Simultaneously Upgraded to
'CRISIL B-/Stable')
The rating revision to 'CRISIL D' reflects instances of overdrawals
in fund-based limit for more than 30 days from August 2019 to
December 2019. The simultaneous upgrade reflects no instances of
overdrawals in fund-based limit over the last three months.
The rating continues to reflect RMI's exposure to regulatory risk
pertaining to duty structure and compliance with environmental
norms, its modest scale of operation and weak financial profile.
These weakness are partially offset by extensive industry
experience of the partners.
Key Rating Drivers & Detailed Description
Weaknesses
* Regulatory risk pertaining to duty structure and compliance with
environmental norms: Lead is hazardous in nature and can cause
serious damage to the environment. Ministry of Environment and
Forests (MoEF) has framed Batteries (Management and Handling)
Rules, 2001. These rules specify that only those who possess
environmentally sound management systems and are registered with
the MoEF/Central Pollution Control Board (CPCB) are allowed to
carry out battery recycling.
* Modest scale of operation: Revenue was modest at INR28 crore
estimated in FY19. RMIs modest scale in the intensely competitive
Diversified Metals & Mining industry will continue to limit its
operating flexibility, thereby constraining its business risk
profile.
* Weak financial profile: Capital structure is leveraged as
reflected in gearing and total outside liabilities to tangible
networth ratio estimated at 2.68 times and 3.95 times as on March
31, 2019 on account of modest networth (Rs 2.05 crore). Debt
protection measures are subdued due to high gearing and low
profitability (interest coverage and net cash accrual to total debt
ratio are estimated at 1.32 and 0.03 for fiscal 2019). RMI debt
protection measures are expected to remain at weak level with high
debt levels.
Strength
* Extensive industry experience of the partners: The partners have
an experience of over 15 years in the metals and mining industry.
This has given them an understanding of the dynamics of the market,
and enabled them to establish relationships with suppliers and
customers.
Liquidity Poor
RMI's bank limit was overdrawn for more than 30 days from August
2019 to December 2019. However, the account was regularised on
December, 21 2019. There have been no instances of overdrawals in
cash credit limits over the last three months. Cash accrual are
expected to remain weak at INR17-21 lakhs annually; however, these
are sufficient in the absence of any term debt obligations over the
medium term.
Outlook: Stable
CRISIL believe RMI will continue to benefit from the extensive
experience of its partner, and established relationships with
clients.
Rating Sensitivity Factors
Upward factors
* Improvement in scale and profitability leading to cash accrual
above 0.80 crore
* Improvement in capital structure
Downward factors
* Stretch in working capital cycle with GCA above 160 days
* Major debt-funded capital expenditure.
RMI was established in 2016, it is located in Nagpur, Maharashtra.
RMI is owned and managed by Shri Prakash Waghdhare and Smt. Sindhu
Waghdhare. RMI is engaged in recycling lead acid batteries to
manufacture lead ingots, with installed capacity of 18000
tons/month.
SCIKNOW TECHNO: CRISIL Reaffirms 'C' Rating on INR7.5cr Loan
------------------------------------------------------------
CRISIL has reaffirmed its 'CRISIL C' rating on the long-term bank
facility of Sciknow Techno Solutions Limited (STSL; part of the
Karvy Data Management Services Ltd (KDMSL) group). CRISIL has also
withdrawn its ratings on the proposed Letter of credit & Bank
Guarantee and Proposed Cash Credit facilities of STSL at the
company's request. The ratings are withdrawn in line with CRISIL's
policy.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Drop Line
Overdraft
Facility 7.5 CRISIL C (Reaffirmed)
Proposed Cash
Credit Limit 2.5 CRISIL A4 (Withdrawn)
of Credit & Bank
Guarantee 40 CRISIL A4 (Withdrawn)
The ratings reflect STSL's working capital intensive operations and
customer concentration in revenue. These weaknesses are partially
offset by the extensive experience of its promoters.
Key Rating Drivers & Detailed Description
Weaknesses
* Exposure to customer concentration risk: As entire revenue
accrues from various government projects, the company remains
susceptible to any change in the tendering process or eligibility
criteria.
* Working-capital-intensive operations: Working capital
requirements are large as reflected in gross current assets at 236
days, driven by receivables and inventory of 100 and 120 days,
respectively, as on March 31, 2019.
Strength
*Experience of the promoters: KREPL is a subsidiary of KDMSL and
benefits from the extensive experience of its promoters.
Liquidity Poor
Liquidity is expected to remain under pressure as the company
remains dependent on the extent and timeliness of fund support from
KDMSL. However, KDMSL's liquidity is also poor and the company had
defaulted on its term debt obligations.
Rating Sensitivity Factors
Upward Factor
* Revenue growth of over 20% along with increase in operating
margin to over 10%.
* Improvement in credit risk profile of KDMSL
Downward Factor
* Any large unanticipated debt funded capital expenditure or
stretch in working capital cycle weakening the financial risk
profile
* Delay in debt servicing by STSL.
About STSL
Hyderabad-based STSL is a manufacturer of electronic components.
About KDMSL
Incorporated in 2008, the Hyderabad-based KDMSL is a step-down
subsidiary of Karvy Stock Broking Ltd (KSBL). It offers business
and knowledge processing services. The company started off as a
pure-play back office service provider and gradually, added other
verticals such as e-Governance, banking, telecom and E-commerce. It
is an established player in government mandates such as the Aadhar
and PAN cards, NPR Biometric and E-TDS. It has healthy relations
with several key government departments and enjoys strong support
from KSBL.
SHANKARRAO PAWAR: CRISIL Lowers Rating on INR25cr New Loan to D
---------------------------------------------------------------
CRISIL has downgraded its rating on the long-term bank facility of
Shankarrao Pawar Seat Corner (SP) to 'CRISIL D' from 'CRISIL
BB-/Stable'.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Cash Credit 4 CRISIL D (Downgraded from
'CRISIL BB-/Stable')
Proposed Long Term 11 CRISIL D (Downgraded from
Bank Loan Facility 'CRISIL BB-/Stable')
Proposed Overdraft 25 CRISIL D (Downgraded from
Facility 'CRISIL BB-/Stable')
The downgrade reflects the recent delay in servicing debt
obligations because of weak liquidity. The rating also reflects
weak financial risk profile and modest scale of operations. These
weaknesses are partly mitigated by extensive experience of
promoters in the industry.
Key Rating Drivers & Detailed Description
Weaknesses:
* Delay in debt servicing due to weak liquidity: The company had
delayed in servicing its debt repayment obligations because of weak
liquidity. Losses incurred and large scheduled repayments led to
strained liquidity.
* Weak financial risk profile: Financial risk profile is likely to
remain weak. The estimated total outside liabilities to tangible
networth ratio remained high at 2.5 times and is expected to remain
at around 2.6 times over the medium term, driven by the
debt-funded capital expenditure (capex) undertaken to renovate the
existing store. Debt protection metrics were also average, with
estimated interest coverage ratio of 1.6 times and 0.07 times in
fiscal 2019.
Strength:
* Extensive experience of the promoter: Presence of over 35 years
in the seat manufacturing and trading business will continue to
support the business over the medium term.
Liquidity Poor
Liquidity is weak as indicated by instances of delays in the
repayment of term loan repayments and interest. There was financial
crunch in the firm which weakened liquidity and delays in servicing
debt.
Rating Sensitivity factors
Upward factors
* Track record of timely debt servicing for at least 90 days
* Substantial increase in revenue along with healthy profitability
SP, set up in 1968, is a Pune-based firm that manufactures seat
covers and other accessories; it also trades in seat accessories
and seats. Mr Rajesh Pawar and Mr Amar Pawar are the promoters.
SIVA SANKARA: CRISIL Lowers Rating on INR12.68cr Loan to 'D'
------------------------------------------------------------
CRISIL has downgraded its rating to 'CRISIL D' from 'CRISIL
BB-/Stable' on the long-term bank facilities of Siva Sankara Paper
Mills (SSPM).
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Cash Credit 12.68 CRISIL D (Downgraded from
'CRISIL BB-/Stable')
Term Loan 1.10 CRISIL D (Downgraded from
'CRISIL BB-/Stable')
The downgrade reflects delay in servicing its term debt obligation
and interest obligation due to weak liquidity.
The rating reflects the delays in servicing of debt, modest scale
of operations and below-average financial risk profile. These
weakness are partially offset by extensive experience of its
partners.
Analytical Approach
Unsecured loans extended by the partner (Rs 3.01 crore as on March
31, 2019) have been treated as neither debt nor equity.
Key Rating Drivers & Detailed Description
Weaknesses:
* Delay in servicing of debt: There has been delay in servicing its
term debt obligation and interest payment.
* Modest scale of operations in fragmented industry: With an
operating income of INR58.09 crore in fiscal 2019, scale remains
modest in the intensely competitive industrial paper industry.
* Below-average financial risk profile: Networth was small at
INR6.33 crore as on March 31, 2019, while gearing was at 2.19 times
as on March 31, 2019. Debt protection metrics were average, with
interest coverage and net cash accrual to total debt ratios of 1.78
times and 2%, respectively, for fiscal 2019.
Strength:
* Extensive experience of partner: Industry presence of over 12
years has enabled the partner to understand market dynamics and
establish healthy relationship with suppliers and customers.
Liquidity Poor
The liquidity of the firm is poor marked by delay in debt servicing
obligation and interest payment. Bank limit were fully utilized
over the 12 months ended March 2020. Improvement in working capital
management hence is critical to improve the liquidity.
Rating Sensitivity factors
Upward factors
* Timely track record of servicing of debt for more than 90 days.
* Improvement in working capital cycle
SSPM was establish in 2005, it is located in Unguturu, Andhra
Pradesh. SSPM is owned and managed by Mrs K Padmini, Mrs
Radhikamani and Mr G Radha. SSPM is engaged in manufacturing of
kraft paper. It has an installed capacity of 18000 MTPA.
SRS LIMITED: CRISIL Maintains 'FD' Debt Rating in Not Cooperating
-----------------------------------------------------------------
CRISIL said the ratings on bank facilities of SRS Limited (SRS)
continues to be 'FD Issuer not cooperating'.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Fixed Deposits 125.00 FD (ISSUER NOT COOPERATING)
CRISIL has been consistently following up with SRS for obtaining
information through letters and emails dated October 15, 2019 and
March 9, 2020 among others, apart from telephonic communication.
However, the issuer has remained non cooperative.
'The investors, lenders and all other market participants should
exercise due caution while using the rating assigned/reviewed with
the suffix 'ISSUER NOT COOPERATING'. These ratings lack a forward
looking component as it is arrived at without any management
interaction and is based on best available or limited or dated
information on the company.
Detailed Rationale
Despite repeated attempts to engage with the management, CRISIL
failed to receive any information on either the financial
performance or strategic intent of SRS, which restricts CRISIL's
ability to take a forward looking view on the entity's credit
quality. CRISIL believes information available on SRS is consistent
with 'Scenario 1' outlined in the 'Framework for Assessing
Consistency of Information with CRISIL BB' rating category or
lower'.
Based on the last available information, the ratings on bank
facilities of SRS continues to be 'FD Issuer not cooperating'.
Incorporated as SRS Commercial Company Ltd in 2000, SRS got its
current name in 2009. It operates in four business verticals: gems
and jewellery (SRS Jewells brand), cinema exhibition (multiplexes
under SRS Cinema), retail value chains (under SRS Value Bazaar and
SRS Fashion Wear), and food and beverages (under SRS 7 Dayz, Asian
Amigo, Punjabi Haandi, and Desi Cafe). The company has been listed
on the Bombay Stock Exchange and National Stock Exchange since
September 2011. It is managed by Dr Anil Jindal, a first-generation
entrepreneur.
STRIDES PHARMA: Bank Debt Trades at 19% Discount
-------------------------------------------------
Participations in a syndicated loan under which Strides Pharma
Science Ltd is a borrower were trading in the secondary market
around 81 cents-on-the-dollar during the week ended Fri., April 24,
2020, according to Bloomberg's Evaluated Pricing service data.
The $50 million facility is a term loan. It is scheduled to mature
on November 24, 2023.
The Company's country of domicile is India.
=================
I N D O N E S I A
=================
STOQO TEKNOLOGI: Startup Shuts Down Amid Coronavirus Outbreak
-------------------------------------------------------------
Yoolim Lee at Bloomberg News reports that Stoqo Teknologi
Indonesia, an online platform that supplies fresh ingredients to
food outlets, is shutting down, becoming the latest casualty of the
coronavirus outbreak.
Stoqo, which delivers everything from chili and eggs to coffee
powder, is ceasing operations after the Covid-19 pandemic
"drastically" slashed its income, the Jakarta-based company said on
its website, Bloomberg relates.
According to Bloomberg, the move underscores the heavy toll on the
region's tech startups. Many firms have seen revenue evaporate
after governments imposed tough restrictions on social activities
to curb the spread of the virus, forcing them to cut salaries and
jobs to deal with a cash crunch. Jakarta-based Traveloka, Southeast
Asia's largest online travel service, dismissed about 80 employees
in Singapore as part of broad cost-cutting measures, Bloomberg News
reported this month.
Stoqo was founded in 2017 by former McKinsey & Co. associate Aswin
Andrison and Angky William, a former software developer at
Amazon.com Inc., to streamline food supply chains by sourcing and
delivering ingredients to small restaurants. In 2019, the business
grew seven times, serving tens of thousands of food outlets across
Greater Jakarta, Chief Executive Officer Andrison said early this
year.
Stoqo Teknologi Indonesia employs about 250 people, according to
its LinkedIn profile. It has raised money from investors including
Accel Partners, Alpha JWC Ventures, Monk's Hill Ventures and
Insignia Ventures Partners.
=====================
N E W Z E A L A N D
=====================
TITAN ACQUISITIONCO: Moody's Alters Outlook on B2 CFR to Neg.
-------------------------------------------------------------
Moody's Investors Service has downgraded Titan AcquisitionCo New
Zealand Limited's corporate family rating to B2 from B1.
Concurrently, Moody's has downgraded Trade Me's first lien senior
secured term loan rating to B2 from B1. Moody's has also revised
the outlook to negative 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. Reflecting the
effects of New Zealand government's implementation of strict
containment measures and the economic shock on business and
consumer sentiment, Trade Me has experienced a material decline in
listing volumes and revenue.
Moody's regards the coronavirus outbreak as a social risk under the
agency's ESG framework, given the substantial implications for
public health and safety. Its action reflects the impact, on Trade
Me, of the breadth and severity of the shock, and the broad
deterioration in credit quality it has triggered relative to the
improvements envisioned at the time the rating was initially
assigned.
The downgrade reflects Moody's expectation that the current
outbreak and government restrictions will materially weaken Trade
Me's earnings and financial profile, such that its credit metrics
will remain outside the thresholds for a B1 rating. In particular,
Moody's expects adjusted debt/EBITDA to remain above 8x over the
next 12-18 months.
The change in outlook to negative reflects the uncertainty over the
severity and duration of the current pandemic and the associated
containment measures, the longer-term impact on the New Zealand
economy, and the flow-on impact on demand for Trade Me's online
businesses.
Moody's expects the government's announcemen on April 28 that it
will loosen selected containment measures will support some
recovery in Trade Me's online marketplace segment, as it will allow
for trade in general items beyond essential items. However,
substantial social distancing restrictions will remain for the
residential and motor vehicle markets -- key markets for Trade Me's
motors and property online classifieds businesses, which contribute
around 50% of group revenue. While open homes will remain
prohibited, private viewings will be permitted and motor vehicle
sales will be limited to contactless delivery and pick-up. As such,
Moody's expects that revenues and demand will remain materially
subdued until these restrictions are lifted.
Substantial demand uncertainty will remain even after the removal
of aforementioned restrictions, given the negative shock on income,
employment and consumer and business sentiment. Due to the exposure
of Trade Me's online classifieds to these macro factors, the timing
and pace of a recovery in revenue is uncertain. Under Moody's base
case assumption, annual revenues are not expected to recover to
historical levels until the fiscal year ending June 30, 2022.
Liquidity
Under Moody's base case assumption, Trade Me's NZD60 million cash
balance as of the end of March will be sufficient to cover the
company's negative free cash flow until the end of 2020, when free
cash flow is expected to return to positive.
While the company has an undrawn balance of NZD58 million available
under its revolver, Moody's does not expect this balance to be
drawn as it would trigger a springing leverage covenant. Compliance
with such an earnings-based leverage covenant will be challenging
at a time when earnings are significantly impacted by current
conditions.
Moody's liquidity analysis does not factor in shareholder support.
However, Moody's expects liquidity support to be forthcoming if
required from the financial sponsor, Apax Partners, given that the
company was bought only a year ago and had performed well prior the
current crisis.
ESG Considerations
Another key social risk for Trade Me relates to data security, as
the company collects a large amount of personal data through its
online businesses. Given the sensitive nature of some of the data
collected, such as credit card details and personal information,
any data breaches would have the potential to trigger to legal,
regulatory or reputational consequences.
Trade Me's ownership structure presents some governance risk to the
extent that private equity firms tend to prioritize more aggressive
growth plans and strategies, including a tolerance for higher
leverage.
Rating Outlook
The negative outlook reflects the uncertainty over the severity and
duration of the current pandemic and the associated containment
measures, the longer-term impact on the New Zealand economy, and
the flow-on impact on demand for Trade Me's online businesses.
The rating could be stabilized once current social distancing
restrictions are removed and there are clear signs of recovery
across the company's online classifieds and marketplace
businesses.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS
Moody's could upgrade the ratings after demand recovers for the
company's online classifieds and marketplace businesses, with the
company's financial profile improving such that adjusted
debt/EBITDA registers below 6.5x.
Moody's could downgrade the ratings if Trade Me's liquidity
deteriorates from Moody's current expectations.
The principal methodology used in these ratings was Business and
Consumer Service Industry published in October 2016.
Titan AcquisitionCo New Zealand Limited is the leading online
marketplace and classified business in New Zealand with local scale
across a breadth of service offerings including auctions, fixed
price sales for new and used goods (Marketplace) and classified
advertisements for automotive (Motors), real estate (Property) and
employment (Jobs). Trade Me also has web businesses specializing in
accommodation, insurance, payments and online dating. The company
was acquired by Apax Partners in 2019.
=================
S I N G A P O R E
=================
EAGLE HOSPITALITY: 5 Hotel Managers in the U.S. Exit
----------------------------------------------------
Fiona Lam at The Business Times reports that five of Eagle
Hospitality Trust (EHT)'s assets in the US were closed by their
previous hotel managers, which have since departed.
These hotel managers had earlier sent termination notices of the
relevant HMAs to their master lessees, which are under Urban
Commons, after the master lessees failed to cure their default of
maintaining sufficient working capital for the hotels' operations,
BT relates. The hotel managers said then that they would terminate
the HMAs if the five master lessees did not cure the defaults
within the applicable cure periods, according to BT.
BT relates that in view of the imminent termination of the HMAs and
the lack of remedial action by the master lessees to safeguard the
hotels, each of the master lessors - which are Eagle Hospitality
Reit's (EH-Reit) subsidiaries - thus entered into a hotel caretaker
agreement with affiliates of GF Hotels & Resorts.
This was done at the direction of the Reit manager and with the
approval of DBS Trustee, Bank of America (BofA) and a syndicate of
lenders. BofA is the administrative agent for the lenders, which
has demanded immediate repayment of EHT's US$341 million loan and
restricted access to several bank accounts of the Reit and master
lessees.
GF Hotels is to provide and implement temporary caretaker services
at the five hotels, under the agreement with the master lessors.
The management of those properties has been handed over to GF
Hotels after an "orderly handover transition" between the previous
hotel managers and GF Hotels, which took place over the course of
last week, EHT's managers said.
According to BT, the EHT managers added that they believe the
caretaker services by GF Hotels are "a cost-effective means by
which to safeguard asset values and minimise losses during the
Covid-19 period". The coronavirus pandemic has caused demand
dislocation and temporary hotel closures across the US.
The caretaker arrangements are also intended to preserve the
underlying value of the hotels, while the EHT managers and the Reit
trustee, together with the assistance of Moelis and the FTI chief
restructuring officers, continue to assess the appropriateness of
the MLAs as part of the strategic review and longer-term plans
post-pandemic, BT relays.
The five affected hotels are: Four Points by Sheraton San Jose
Airport, Crowne Plaza Danbury, Hilton Houston Galleria Area,
Embassy Suites by Hilton Palm Desert and Doubletree by Hilton Salt
Lake City Airport, BT discloses.
Trading in EHT stapled securities has been suspended since March
24, 2020, the report 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.
HIN LEONG: Sembcorp Cogen Obtains Court Order to Secure Gasoil
--------------------------------------------------------------
Vivienne Tay at The Business Times reports that Sembcorp
Industries' (SCI) wholly-owned power generation subsidiary Sembcorp
Cogen on April 24 obtained an order from the Singapore High Court
to restrain Universal Terminal from moving, removing or disposing
of any gasoil reserves designated for the subsidiary.
Under the court order, the oil storage terminal - co-owned by
debt-hit giant oil trader Hin Leong Trading (HLT) and located on
Singapore's Jurong Island - is also required to ensure those gasoil
reserves are stored separately from any other gasoil, BT relates.
There is a possibility that the gasoil reserves designated for
Sembcorp Cogen may be subject to competing claims by one or more
third parties, SCI said on April 27, according to BT. Sembcorp
Cogen has commenced legal proceedings in the High Court to assert
its ownership of these reserves.
The carrying book value of the gasoil reserves that Sembcorp Cogen
has stored with HLT stood at SGD94 million as at Dec. 31, 2019, BT
discloses.
BT notes that the court order was obtained days after SCI said on
April 22 that the power generation unit has scrapped a more than
decade-old gasoil supply and storage (GSS) deal with HLT to
safeguard its interest.
Under the GSS agreement, the trading firm sold gasoil reserves to
Sembcorp Cogen, and stored and managed them on the latter's behalf,
to fulfill certain regulatory requirements under Sembcorp Cogen's
electricity generation licence, BT says.
Court documents filed on April 17 for HLT's moratorium order
revealed that SCI had issued a notice to the trading firm demanding
that the cargo (gasoil) not be discharged and that its inventory is
consolidated into dedicated tanks and demarcated.
The Business Times (BT) reported last week that HLT has since
withdrawn its application for the debt moratorium and decided to
file for judicial management instead. The firm is grappling with a
debt pile of some US$4 billion.
Universal Terminal is 41 per cent owned by the family of Hin Leong
founder Lim Oon Kuin or OK Lim. China's oil giant PetroChina and
Australia's Macquarie Asia Infrastructure Fund own 25 per cent and
34 per cent respectively.
Oil giants Vitol and China's state-run Sinopec are among several
industry titans eyeing a stake in the oil storage terminal, BT
reported on April 24.
About Hin Leong
Hin Leong Trading (Pte.) Ltd. provides petroleum products and
transportation services. The Company offers oil, lubricants,
grease, and diesel products, as well grants storage, terminalling,
trucking, and marine logistics services. Hin Leong Trading serves
customers globally.
Hin Leong Trading and shipping unit Ocean Tankers (Pte.) Ltd. filed
for court protection from creditors on April 17, 2020, as the
former struggles to repay debts of almost US$4 billion.
Hin Leong posted a positive equity of US$4.56 billion and net
profit of US$78 million in the period ended October 31, according
to the people, who asked not to be identified as the matter is
sensitive, according to Bloomberg News.
But Hin Leong told its creditors this month that total liabilities
reached US$4.05 billion as of early April, while assets were just
US$714 million, leaving a hole of at least US$3.34 billion,
according to screenshots of the presentation to a group of bankers
seen by Bloomberg News.
The balance sheet of the company showed no equity at all as of
April 9, 2020, and warned that "figures obtained from the company
are subject to verification," Bloomberg News added.
As reported in Troubled Company Reporter-Asia Pacific on April 24,
2020, The Financial Times said that Hin Leong is seeking to appoint
PwC as an independent manager to run the business as it pursues a
debt restructuring of almost $4 billion. The company will withdraw
the bankruptcy protection filing it submitted on April 17 and
instead ask Singapore's High Court to appoint PwC as a third party
to run the company, a process known as judicial management.
===========
T A I W A N
===========
WAN HAI LINES: Moody's Alters Outlook on Ba2 CFR to Stable
----------------------------------------------------------
Moody's Investors Service has changed the outlook on Wan Hai Lines
Ltd. to stable from positive. At the same time, Moody's has
affirmed Wan Hai's Ba2 corporate family rating.
RATINGS RATIONALE
"The change in outlook to stable from positive reflects its
expectation that Wan Hai's credit metrics will weaken over the next
12-18 months, amid weak demand for container shipping," says Chenyi
Lu, a Moody's Vice President and Senior Credit Officer.
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.
More specifically, Wan Hai's exposure to global container shipping
has left it vulnerable to shifts in market sentiment, given its
sensitivity to end-demand.
"At the same time, the rating affirmation reflects its expectation
that the company's operational track record of over 40 years,
prudent financial management and sound liquidity provide it with a
strong buffer against the ongoing industry volatility," adds Lu.
Wan Hai's focus on the intra-Asia liner market with a
well-established presence leaves its operations relatively
resilient among peers and partly offsets industry cyclicality.
Moreover, the company has maintained a prudent operational strategy
to quickly adjust its chartered fleet size and slot capacity in
light of weak demand.
Moody's expects Wan Hai's debt leverage — as measured by adjusted
net debt/EBITDA — will increase to around 2.9x-3.3x over the next
12-18 months from 2.3x in 2019, because of softer earnings and an
increase in net debt to support capital spending. This level of
leverage will remain appropriate for Wan Hai's Ba2 CFR, supported
by the company's long track record of holding ample cash.
Moody's also expects Wan Hai's revenue to decline by 5% in 2020 but
to grow by 9% in 2021. This assumption is mainly driven by expected
volume declines especially in the second and third quarter of 2020
amid weak demand, balanced with relatively steady freight rates.
The company reported strong year-on-year revenue growth of 4.1% and
9.2% in 1Q 2020 and 2019, respectively.
Moody's expects that Wan Hai's adjusted EBITDA margins will remain
steady over the next 12-18 months from 11.8% in 2019, supported by
steady freight rates, lower short-time charter hiring costs and the
company's strong implementation of expense controls. Wan Hai's
profit margins improved in 2019 due to better freight rates and
cost control measures.
Wan Hai's adjusted net debt will increase over the next 12-18
months, mainly to fund its large capital spending program to
purchase 20 new vessels that will be delivered over 2020-22. The
purchase forms part of the company's multi-year replacement cycle
of aged and uneconomical vessels. As such, Moody's believes the
company will maintain a short-term charter strategy and remain
prudent in its investments.
Moody's further expects capital spending will peak in 2020 and
substantially decline in the next multiple years.
Wan Hai's liquidity is strong. At the end of 2019, the company held
NTD15.5 billion in cash and cash equivalents and short-term
marketable investments of NTD4.1 billion, which, together with
Moody's estimated operating cash flow for the company of NTD7.0
billion to NTD7.5 billion in the next 12 months, provide a strong
liquidity reserve for the repayment of NTD4.3 billion in short-term
debt and lease obligations, and projected capital spending of about
NTD13.5 billion over the same period.
Wan Hai also had committed undrawn credit facilities of USD330
million at the end of March 2020.
The rating also take into account the following environmental,
social and governance considerations.
Firstly, the shipping sector is affected by the IMO 2020
regulation, which states that all vessels will have to use
low-sulphur fuel from January 1, 2020. As such, Wan Hai is exposed
to higher fuel costs, which will be temporarily offset by low oil
prices over 2020.
Secondly, Moody's regards the coronavirus outbreak as a social risk
under its ESG framework, given the substantial implications for
public health and safety. Its action reflects the impact on Wan Hai
of the breadth and severity of the shock, and the broad
deterioration in credit quality it has triggered.
Thirdly, on the governance front, the company has a track record of
prudent financial management, as reflected by large cash holdings
and disciplined investments over the industry cycles. The company
also has a long listing history on the Taiwan Stock Exchange since
1996, and a diversified ownership structure.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS
The rating could be upgraded if Wan Hai maintains a prudent
investment and operating strategy and improves its credit metrics,
such that adjusted net debt/EBITDA falls below 2.0x on a sustained
basis.
The rating could be downgraded if the company's (1) liquidity
reserve depletes materially; or (2) debt leverage rises, such that
adjusted net debt/EBITDA exceeds 3.5x on a sustained basis, as a
result of declining revenue, deteriorating profitability or
debt-funded acquisitions.
The principal methodology used in this rating was Shipping Industry
published in December 2017.
Wan Hai Lines Ltd., listed on the Taiwan Stock Exchange since May
1996, operated a fleet of 99 container vessels (68 wholly owned and
31 chartered) at the end of 2019, offering intra-Asia, Asia-Middle
East and trans-Pacific liner services.
With 36 dedicated service routes at the end of 2019, Wan Hai is the
leading provider of intra-Asia container shipping services, with an
estimated 15% market share.
*********
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 ***