/raid1/www/Hosts/bankrupt/TCRAP_Public/200520.mbx
T R O U B L E D C O M P A N Y R E P O R T E R
A S I A P A C I F I C
Wednesday, May 20, 2020, Vol. 23, No. 101
Headlines
A U S T R A L I A
ELMSDALE PTY: First Creditors' Meeting Set for May 27
FRESH START: Second Creditors' Meeting Set for June 3
G-STAR AUSTRALIA: First Creditors' Meeting Set for May 27
G-STAR RAW: EY Appointed as Voluntary Administrators
LA TROBE 2020-1: S&P Assigns B (sf) Rating on Class F Notes
NORCHAP INDUSTRIES: Second Creditors' Meeting Set for May 27
ORGANIC DAIRY: First Creditors' Meeting Set for May 27
PVLT HOLDINGS: First Creditors' Meeting Set for May 28
SWEET LIFE: Second Creditors' Meeting Set for May 26
T & B MINE: Second Creditors' Meeting Set for May 26
VIRGIN AUSTRALIA: Moody's Cuts CFR to Ca on Missed Coupon Payment
C H I N A
GSX TECHEDU: A "Near Total Fraud," Muddy Waters Says
PEKING UNIVERSITY: Bankruptcy Casts Doubt on Chinese Bond Claims
PUJIANG INTERNATIONAL: Moody's Gives B2 CFR, Outlook Stable
REDCO PROPERTIES: S&P Rates New US Dollar Sr. Unsecured Notes 'B'
ZHENENG JINJIANG: S&P Alters Outlook to Stable & Affirms 'BB-' ICR
I N D I A
BE BE RUBBER: CRISIL Lowers Rating on INR4.85cr Cash Loan to B-
BERTLING LOGISTICS: CRISIL Keeps B Debt Rating in Not Cooperating
BHAGYODAYA MOTORS: CRISIL Lowers Rating on INR15cr Cash Loan to D
BREMELS RUBBER: CRISIL Keeps 'D' Debt Ratings in Not Cooperating
BRINDAVAN SHELTERS: CRISIL Cuts Rating on INR10cr Loans to B+
BRUCK PHARMA: CRISIL Keeps B INR19.2cr Debt Rating in Not Coop.
D K CERAMIC: CRISIL Keeps 'D' Debt Ratings in Not Cooperating
DEV PRIYA: CRISIL Lowers Rating on INR30cr Cash Loan to B+
DRILLCON INFRASTRUCTURE: CRISIL Cuts Rating on INR8cr Loan to B+
GOVIND STEEL: CRISIL Lowers Rating on INR10cr Cash Loan to B+
HILLWOOD FURNITURE: CRISIL Keeps D Debt Ratings in Not Coop.
INARCO PRIVATE: CRISIL Lowers Rating on INR4cr Cash Loan to B+
INNOVATIVE LOGISTICS: CRISIL Cuts Rating on INR5.20cr Loan to B+
INTOUCH MOBICARE: CRISIL Keeps B+ INR4cr Debt Rating in Not Coop.
IVORY CLOTHING: CRISIL Keeps B+ INR1cr Loan Rating in Not Coop.
JAWAHAR EDUCATION: CRISIL Keeps D INR31cr Debt Rating in Not Coop.
JOSAN RICE: CRISIL Maintains B+ Debt Ratings in Not Cooperating
KHUSHI COTSPIN: CRISIL Keeps B Debt Ratings in Not Cooperating
KRISHNA AND COMPANY: CRISIL Cuts Rating on INR10cr Loan to B+
LEADE LIQUOR: CRISIL Keeps 'D' Debt Ratings in Not Cooperating
MAA ANNAPURNA: CRISIL Keeps 'B' Debt Ratings in Not Cooperating
MADHUBAN BUILDERS: CRISIL Keeps D INR8cr Loan Rating in Not Coop.
MANGALA ELECTRICALS: CRISIL Lowers Rating on INR2.5cr Loan to D
METAL CRAFT: CRISIL Lowers Rating on INR10cr Cash Loan to B+
MY FONE: CRISIL Keeps 'D' INR5cr Cash Rating in Not Cooperating
R.K. STEEL: CRISIL Lowers Rating on INR15cr Cash Loan to B+
SHIVANI LOCKS: CRISIL Migrates INR25cr Term Loan Rating to B+
SIRSA BANSIVAT: CRISIL Lowers Rating on INR10cr Loans to 'D'
VARNIKA JEWELLERS: CRISIL Reaffirms B+ Rating on INR5.4cr Loan
[*] INDIA: To Privatise State-Run Companies Amid COVID-19 Pandemic
[*] INDIA: To Put on Hold Bankruptcy Code for One Year
I N D O N E S I A
GARUDA INDONESIA: Furloughs 800 Contract Workers to Stay Afloat
N E W Z E A L A N D
CARTER HOLT: Proposes to Cut Workforce at Marsden Point in Half
S I N G A P O R E
EZION HOLDINGS: Posts US$211.3MM Net Loss for Q1 Ended March 31
HATTEN LAND: Unit to Defend Against Contractor's MYR100MM Claim
- - - - -
=================
A U S T R A L I A
=================
ELMSDALE PTY: First Creditors' Meeting Set for May 27
-----------------------------------------------------
A first meeting of the creditors in the proceedings of Elmsdale Pty
Ltd will be held on May 27, 2020, at 11:00 a.m. via
teleconference.
James S McPherson -- jmcpherson@meertens.com.au -- and Austin R M
Taylor -- ataylor@meertens.com.au -- of Meertens were appointed as
administrators of Elmsdale Pty on May 15, 2020.
FRESH START: Second Creditors' Meeting Set for June 3
-----------------------------------------------------
A second meeting of creditors in the proceedings of Fresh Start
Equity Pty Ltd (former business names "FIT FARE", "DAILY FARE",
"FARE AND FROLIC", "FARE & FROLIC" & "THE FOOD CODE") has been set
for June 3, 2020, at 11:00 a.m. via electronic facilities.
The purpose of the meeting is (1) to receive the report by the
Administrator about the business, property, affairs and financial
circumstances of the Company; and (2) for the creditors of the
Company to resolve whether the Company will execute a deed of
company arrangement, the administration should end, or the Company
be wound up.
Creditors wishing to attend are advised proofs and proxies should
be submitted to the Administrator by June 2, 2020, at 4:00 p.m.
Steven Staatz of Vincents was appointed as administrator of Fresh
Start on May 4, 2020.
G-STAR AUSTRALIA: First Creditors' Meeting Set for May 27
---------------------------------------------------------
A first meeting of the creditors in the proceedings of G-Star
Australia Pty Ltd will be held on May 27, 2020, at 11:30 a.m. via
teleconference only.
Justin Denis Walsh, Samuel Freeman and Stewart McCallum of Ernst &
Young were appointed as administrators of G-Star Australia on May
15, 2020.
G-STAR RAW: EY Appointed as Voluntary Administrators
----------------------------------------------------
Dean Blake at Inside Retail reports that fashion brand G-Star Raw
has become the latest victim of the dual issues of coronavirus and
falling discretionary spend, falling into voluntary administration
on May 15.
According to Insider Retail, consultancy firm Ernst & Young was
appointed as administrators for the business and are urgently
assessing G-Star Raw's viability and forming a strategy for the
administration, which could affect the business' 200 staff.
"Traditional retailers were already facing business challenges
before COVID-19, [which] has certainly increased those pressures,"
the report quotes EY administrator Justin Walsh as saying. "We
expect that as lockdowns are lifted and various levels of
government stimulus take effect retailers will experience an
uptick, however the impact remains significant."
When contacted for clarification by Inside Retail, EY provided no
further comment.
G-Star Raw, a Dutch brand founded in 1989, runs 57 outlets in
Australia.
LA TROBE 2020-1: S&P Assigns B (sf) Rating on Class F Notes
-----------------------------------------------------------
S&P Global Ratings assigned its ratings to eight of the 10 classes
of residential mortgage-backed securities (RMBS) issued by
Perpetual Corporate Trust Ltd. as trustee for La Trobe Financial
Capital Markets Trust 2020-1. La Trobe Financial Capital Markets
Trust 2020-1 is a securitization of nonconforming and prime
residential mortgages originated by La Trobe Financial Services Pty
Ltd. (La Trobe Financial).
The ratings reflect:
-- That the credit risk of the underlying collateral portfolio and
the credit support provided to each class of notes are commensurate
with the ratings assigned. Credit support is provided by
subordination and excess spread. The assessment of credit risk
takes into account La Trobe Financial's underwriting standards and
approval process, and La Trobe Financial's servicing quality.
-- That the transaction's cash flows can meet timely payment of
interest and ultimate payment of principal to the noteholders under
the rating stresses. Key factors are the level of subordination
provided, the condition that a minimum margin will be maintained on
the assets, an amortizing liquidity facility sized at 1.5% of the
note balance, the principal draw function, the yield reserve, the
retention amount built from excess spread before the call date, the
amortization amount built from excess spread after the call date or
upon a servicer default, and the provision of an extraordinary
expense reserve. All rating stresses are made on the basis that the
trust does not call the notes at or beyond the call date, and that
all rated notes must be fully redeemed via the principal waterfall
mechanism under the transaction documents.
-- That S&P also has factored into its ratings the legal structure
of the trust, which has been established as a special-purpose
entity and meets our criteria for insolvency remoteness.
-- The counterparty support provided by National Australia Bank
Ltd. as liquidity facility provider and Commonwealth Bank of
Australia as bank account provider. The transaction documents for
the liquidity facility and bank accounts include downgrade language
consistent with S&P's " Counterparty Risk Framework: Methodology
And Assumptions" criteria, published on March 8, 2019, that
requires the replacement of the counterparty or other remedy,
should its rating fall below the applicable rating.
-- That loss of income for borrowers in the coming months due to
the effects of COVID-19 will likely put liquidity strain on the
transaction and raises the probability of upward pressure on
mortgage arrears over the longer term. S&P has therefore applied a
range of additional stresses in its analysis to assess the rated
notes' sensitivity to liquidity stress, and the possibility of
higher arrears. As of April 30, 2020, borrowers with
COVID-19-related hardship arrangements make up 12.3% of the closing
pool balance.
S&P Global Ratings acknowledges a high degree of uncertainty about
the rate of spread and peak of the coronavirus outbreak. S&P said,
"Some government authorities estimate the pandemic will peak about
midyear, and we are using this assumption in assessing the economic
and credit implications. We believe the measures adopted to contain
COVID-19 have pushed the global economy into recession. As the
situation evolves, we will update our assumptions and estimates
accordingly."
RATINGS ASSIGNED
La Trobe Financial Capital Markets Trust 2020-1
Class Rating Amount (mil. A$)
A1S AAA (sf) 281.25
A1L AAA (sf) 593.75
A2 AAA (sf) 235.00
B AA (sf) 37.50
C A (sf) 36.25
D BBB (sf) 25.00
E BB (sf) 12.50
F B (sf) 12.49
Equity 1 NR 8.130
Equity 2 NR 8.130
NR--Not rated.
NORCHAP INDUSTRIES: Second Creditors' Meeting Set for May 27
------------------------------------------------------------
A second meeting of creditors in the proceedings of Norchap
Industries Pty Ltd has been set for May 27, 2020, at 10:00 a.m. via
electronic facilities.
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 26, 2020, at 4:00 p.m.
Michael Caspaney of Menzies Advisory was appointed as administrator
of Norchap Industries on April 21, 2020.
ORGANIC DAIRY: First Creditors' Meeting Set for May 27
------------------------------------------------------
A first meeting of the creditors in the proceedings of Organic
Dairy Farmers Of Australia Limited will be held on May 27, 2020, at
2:30 p.m. via teleconference only.
Ivan Glavas and Scott Andersen of Worrells Solvency & Forensic
Accountants were appointed as administrators of Organic Dairy on
May 15, 2020.
PVLT HOLDINGS: First Creditors' Meeting Set for May 28
------------------------------------------------------
A first meeting of the creditors in the proceedings of PVLT
Holdings Pty Ltd will be held on May 28, 2020, at 11:00 a.m. via
Zoom Virtual Meeting facilities.
Daniel Frisken of O'Brien Palmer was appointed as administrator of
PVLT Holdings on May 18, 2020.
SWEET LIFE: Second Creditors' Meeting Set for May 26
----------------------------------------------------
A second meeting of creditors in the proceedings of The Sweet Life
Farms Australia Pty Ltd has been set for May 26, 2020, at 11:30
a.m. via virtual meeting.
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 25, 2020, at 4:00 p.m.
Steve Naidenov and Ian Niccol of Aston Chace Group were appointed
as administrators of Sweet Life on April 21, 2020.
T & B MINE: Second Creditors' Meeting Set for May 26
----------------------------------------------------
A second meeting of creditors in the proceedings of T & B Mine
Service Pty Ltd, trading as T & B Engineering, has been set for May
26, 2020, at 11:00 a.m. via Skype for business teleconference
facilities.
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 25, 2020, at 4:00 p.m.
Simon Thorn of PKF was appointed as administrator of T & B Mine on
April 21, 2020.
VIRGIN AUSTRALIA: Moody's Cuts CFR to Ca on Missed Coupon Payment
-----------------------------------------------------------------
Moody's Investors Service has downgraded Virgin Australia Holdings
Limited's Corporate Family Rating to Ca from Caa1. Concurrently,
Moody's has downgraded Virgin's senior unsecured and backed senior
unsecured ratings to C from Caa2, and its backed senior unsecured
MTN program to (P)C from (P)Caa2.
The outlook on the ratings has been changed to developing from
ratings under review.
RATINGS RATIONALE
The rapid and widening spread of the coronavirus outbreak,
deteriorating global economic outlook, falling oil prices, and
asset price declines are creating a severe and extensive credit
shock across many sectors, regions and markets. The combined credit
effects of these developments are unprecedented. The airline sector
has been one of the sectors most significantly affected by the
shock given its sensitivity to consumer demand and sentiment. More
specifically, the weaknesses in Virgin's credit profile, including
its exposure to global demand for travel, have left it vulnerable
to shifts in market sentiment in these unprecedented operating
conditions. 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
Virgin of the breadth and severity of the shock, and the broad
deterioration in credit quality it has triggered.
The rating action was prompted by Virgin missing the coupon payment
on May 15, 2020 of its USD425 million 8.125% 2024 bonds, after
entering into voluntary administration on April 21, 2020.
ENVIRONMENTAL, SOCIAL AND GOVERNANCE (ESG) CONSIDERATIONS
Moody's Moody's regardss the coronavirus outbreak as a social risk
under its ESG framework, given the substantial implications for
public health and safety.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS
Virgin is in voluntary administration and a number of potential
bidders have expressed interest in purchasing the airline.
Additionally, the second creditors' meeting has been scheduled for
August 22, 2020.
Any future change in rating will depend on the outcome of the
voluntary administration process.
PRINCIPAL METHODOLOGY
The principal methodology used in these ratings was Passenger
Airline Industry published in April 2018.
COMPANY PROFILE
Virgin Australia Holdings Limited, headquartered in Brisbane, is
Australia's second largest airline following its launch in 2000 and
listing on the Australian Securities Exchange in 2003. As of fiscal
2019, it had generated revenues of AUD5.8 billion and carried
around 24.8 million passengers.
=========
C H I N A
=========
GSX TECHEDU: A "Near Total Fraud," Muddy Waters Says
----------------------------------------------------
Kenneth Rapoza at Forbes reports that short selling research firm,
Muddy Waters, is going after another Chinese company after
highlighting questionable accounting at Luckin Coffee, now halted
on the Nasdaq.
This one is Chinese online educator, GSX Techedu Inc. Their stock
is up 40% year-to-date, beating the MSCI China by a country mile.
Forbes relates that Muddy Waters said they are short the stock
because they consider it a "near total fraud."
According to their research, around 70% of its users are fake.
Their info is based on GSX's student user and attendance data.
Muddy Waters said they downloaded data from more than 200 paid K-12
education courses which equaled 54,065 unique users, Forbes
relays.
They said that a former GSX manager verified their analysis, and
explained various details of how they used bots. "Based on the near
total faking of users, we assume that the fraudulent portion of
GSX's revenue is at least equal to the percentage of fraudulent
users," report authors wrote. "GSX is a massive loss-making
business. Without users, there is no revenue. GSX is an almost
completely empty box."
On May 6, GSX announced strong first quarter earnings as many
students were stuck at home in coronavirus quarantine, Forbes
discloses. Paid course enrollments increased 307.4% year-over-year
to 774,000. Net revenues increased 382.0% year-over-year to RMB1.3
billion. Net income increased 336.6% to RMB148 million, from
RMB33.9 million in the same period of 2019.
Forbes says this is not the first time Muddy Waters has targeted a
Chinese online educator. They called TAL Education (TAL) 'fake
finance' in 2018. Their stock is up 32% since.
GSX, meanwhile, said its Board of Directors authorized a share
buyback program under which the company is allotted to pick up $150
million worth of shares.
Forbes adds that Muddy Waters said that GSX founder and CEO Larry
Xiangdong Chen recently pledged at least $318 million of his own
stock. "Long holders of GSX face the risk that the margin lenders
will be forced to aggressively sell the stock, crashing the price,"
according to Muddy Waters.
GSX Techedu Inc. is a technology-driven education company that
provides online K-12 after-school tutoring services in China.
PEKING UNIVERSITY: Bankruptcy Casts Doubt on Chinese Bond Claims
----------------------------------------------------------------
Alison Tudor-Ackroyd at South China Morning Post reports that the
bankrupt Peking University Founder Group used a short cut known as
a keepwell deed to borrow US dollars from foreign investors. Now,
its state-appointed restructuring administrator has thrown doubt on
the enforceability of these contracts by classifying them as
pending recognition.
This decision impacts bondholders of about 16 per cent, or US$96
billion, of outstanding offshore bonds issued by Chinese companies,
according to Redd, a market data provider, SCMP relays. More than
US$12 billion of debt rated by credit rating agency Moody's uses
keepwell deeds.
"This is the first time keepwell deeds have been tested in court.
The administrator could set an important precedent," the report
quotes Renee Lam, a credit officer researching companies across the
Asia-Pacific region at ratings agency Fitch, as saying.
From British bank HSBC suspending dividend payments to rising
defaults on payments due to bondholders, borrowers and governments
are riding roughshod over investors' rights as they grapple with
the fallout from the novel coronavirus pandemic, SCMP says.
With more companies coming under stress as the global economy
tumbles into its worst downturn since the 1930s' Great Depression,
legal fights and restructurings will test other grey areas of
investments that have mushroomed during the world's longest bull
market since the 2007-08 global financial crisis, according to
SCMP.
"When the market is good, investors don't worry. But when the
market is stressed, they take another look at these structures,"
SCMP quotes Soo Cheon Lee, chief investment officer at
credit-focused banking and asset management group SC Lowy, as
saying.
SCMP notes that Chinese borrowers started using keepwell deeds to
skirt the niceties of Chinese foreign investment restrictions and
capital controls around 2012, mostly because incorporating them in
contracts was usually a quicker and more reliable route than
requesting a guarantee from China's State Administration of Foreign
Exchange (SAFE).
About Peking Founder
Chinese state-owned Peking University Founder Group Corp. provides
information technology services. The Company offers software
development, electronic publishing system development, smart city
solution development, data operation, and other services. Peking
University Founder Group also operates financing, medical
technology development, and other businesses.
On Feb. 19, 2020, Founder Holdings Limited received a notification
letter from Peking Founder, regarding a civil order and decision
letter received by Peking Founder from The First Intermediate
People's Court of Beijing. Pursuant to the civil order and decision
letter, the Court decided to accept the application made by Bank of
Beijing Co., Ltd. for the initiation of restructuring procedure
against Peking Founder, and appointed Peking Founder liquidation
team as the administrator of Peking Founder. The Peking Founder
liquidation team consists of, among others, the People's Bank of
China, the Ministry of Education of the People's Republic of China,
relevant financial regulators and relevant departments of Beijing
Municipal Government.
Bank of Beijing Co. Ltd., one of the creditors of Peking University
Founder Group Corp., asked a court to restructure the indebted
state-owned conglomerate in February 2020, according to Caixin
Global.
PUJIANG INTERNATIONAL: Moody's Gives B2 CFR, Outlook Stable
-----------------------------------------------------------
Moody's Investors Service has assigned a B2 corporate family rating
to Pujiang International Group Limited.
The rating outlook is stable.
RATINGS RATIONALE
"The B2 CFR reflects Pujiang's leading position in China's bridge
cable and prestressed materials markets," says Roy Zhang, a Moody's
Vice President and Senior Analyst.
Pujiang is a leading bridge cable supplier and a major prestressed
steel materials manufacturer in China. The company has established
its market leadership through its use of advanced technology,
proven product reliability, long operational track record, good
client relationships and financial resources.
Given the high barriers of entry for bridge cable materials, which
contributed to 66% of Pujiang's gross profits in 2019, the market
for bridge cables in China is an oligopoly, especially in the
high-end segment. Moody's expects the company's competitiveness to
continue to strengthen, given its ongoing investment in research
and development and market penetration.
Bridge cables are a key component in bridge structures and are
consequently essential for ensuring public safety. Therefore, only
a few suppliers can meet the necessary capabilities in terms of
technology, reliability and track record.
The company's cable business has exhibited stable margins, with its
gross margin averaging around 35% in the past three years.
"However, the rating is constrained by the company's limited scale,
heavy working capital requirements and weak liquidity," adds
Zhang.
Pujiang's revenue of RMB1.8 billion in 2019 is modest for its
rating level. The business is heavily reliant on government
spending on infrastructure projects, in particular for large
bridges. Such concentration risk is partially mitigated by the high
level of infrastructure investment expected in China over the next
three years.
As part of its operations, Pujiang prepays for raw materials and
deposits to qualify for new projects, which means that the company
needs to finance its account receivables and working capital to
grow. This has resulted in negative cash flow from operations for
Pujiang in the past three years.
However, Moody's believes the company's counterparty risks are
manageable as most of them either stem from large steel mills or
state-owned project owners.
The company's leverage, as measured by total debt to EBTIDA,
reached 4.9x at end of 2019, as one-off IPO expenses and share
compensation lowered its EBITDA. However, Moody's expects its
leverage to improve to 4.0x-4.5x in the next 12 to 18 months, a
modest level for its rating.
Pujiang's liquidity profile is weak because of its high reliance on
short-term debt, which reached RMB905 million at the end of 2019,
well exceeding its cash holdings of RMB526 million.
Nonetheless, Moody's expects that the company can roll over its
debt with domestic banks, given its profitable operations, strong
market position and established relations with local banks.
The ratings also take into account the following environmental,
social and governance considerations.
Pujiang has limited public financial track record as it only listed
on the Hong Kong Stock Exchange in 2019. Its ownership is
concentrated in its key shareholder, Mr. Tang Liang, who held a
62.8% stake in the company at the end of 2019.
The stable outlook reflects Moody's expectation that Pujiang will
maintain its leading market position, good funding access and
strong banking relationships.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATING
Moody's could upgrade the rating if the company materially improves
its operating scale and liquidity profile on a sustained basis,
while maintaining its market leadership with total debt to EBITDA
staying below 3.0x-3.5x on a sustained basis.
On the other hand, Moody's could downgrade the rating if the
company's liquidity deteriorates, its market position and
operations weaken, it fails to maintain a prudent financial policy,
or its total debt to EBITDA rises above 5.0x on a sustained basis.
The principal methodology used in this rating was Building
Materials published in May 2019.
Pujiang International Group Limited is a leading bridge cables and
prestressed materials manufacturer based in China. Incorporated in
April 2017, the company was listed on the Hong Kong Stock Exchange
in May 2019. Pujiang is 62.8% owned by Dr. Tang Liang as of 2019.
REDCO PROPERTIES: S&P Rates New US Dollar Sr. Unsecured Notes 'B'
-----------------------------------------------------------------
S&P Global Ratings assigned its 'B' long-term issue rating to the
U.S. dollar-denominated senior unsecured notes proposed by Redco
Properties Group Ltd. (B/Stable/--). The issue rating is subject to
S&P's review of the final issuance documentation.
S&P equalizes the issue rating with the issuer credit rating on
Redco because the proposed notes are not significantly subordinated
to other debt in the company's capital structure. As of Dec. 31,
2019, Redco's capital structure consisted of about Chinese renminbi
(RMB) 7.5 billion in secured debt, RMB9.7 billion in unsecured debt
and other borrowings issued at the holding company level. The
company's priority debt ratio is below its notching down threshold
of 50%.
S&P believes the proposed issuance will improve Redco's liquidity
amid lower contracted sales growth due to the COVID-19 pandemic.
The Chinese property developer's reported first-quarter contracted
sales were down 16% year on year to RMB3.9 billion, slightly better
than the average 21% drop among rated peers.
S&P said, "The stable outlook reflects our expectation that Redco
will continue to expand its operating scale and have stable
profitability and effective control over debt leverage over the
next two years. We do not expect the new issuance to have a
significant impact on Redco's financial leverage."
That's because the company will use the proceeds to refinance its
existing debt.
ZHENENG JINJIANG: S&P Alters Outlook to Stable & Affirms 'BB-' ICR
------------------------------------------------------------------
On May 19, 2020, S&P Global Ratings affirmed the 'BB-' long-term
issuer credit rating on Zheneng Jinjiang Environment Co. Ltd.
(ZJE). S&P also affirmed the 'B+' long-term issue rating on the
company's senior unsecured notes. S&P revised the outlook on the
issuer credit rating to stable from positive.
S&P affirmed its rating on ZJE with stable outlook to reflect the
company's weakened cash generation ability and its expectation that
its debt-funded capital expenditure (capex) will remain high in the
next 12-18 months. Nonetheless, this is offset by the expected
financial support from ZPEG, the largest shareholder of the
company.
ZJE's cash leverage ratio continued to deteriorate in 2019. Its
ratio of funds from operations (FFO) to debt further weakened to
about 6.5% in the year, down about 4 percentage points from 2018.
The deterioration in FFO was largely due to a 65% year-on-year
decline in the gross profit of its noncore energy management
contract and technical project management businesses (EMC
business). As such, ZJE's gross profit from its EMC business
(excluding build-operate-transfer construction profits) represented
only 16.2% of its reported profits at end-2019, compared with 37.8%
a year ago. Tempering the decline was the improvement in operating
efficiencies, after ZJE completed most of the capacity and
technological upgrades of its WTE facilities, which led to improved
power sales in its waste treatment segment. Seven out of eight WTE
facilities completed the upgrades in the second half of 2019,
improving the average utilization rate to about 88% in 2019 (from
77% in 2018) and lowering the internal electricity consumption by 2
percentage points to about 26%.
S&P said, "We expect ZJE's debt-funded capex to remain high and
constrain the recovery of its FFO-to-debt ratio over the next 12-18
months. ZJE's reported debt surged by 16% to Chinese renminbi (RMB)
7.8 billion as of end-2019. Moreover, the expected additional waste
treatment capacity of 7,000 tons per day to be commissioned in 2020
will utilize a material portion of the RMB2.7 billion capex to be
deployed during the year.
"We expect the COVID-19 pandemic to moderately affect ZJE's
financial performance. The negative effects were mainly
concentrated in the company's WTE plants in Hubei province during
the lockdown period. Overall waste treatment volume recorded a 10%
year-on-year drop in the first three months of 2020 due to a
reduction in commercial and industrial activities, although this
has gradually recovered to over 95% of prepandemic levels since
April 2020.
"As a result, we expect ZJE's FFO-to-debt ratio to remain at 6%-8%
over the next 12-18 months, underpinning a highly leveraged
financial risk profile."
S&P considers ZJE to be a moderately strategic subsidiary of ZPEG.
The latter now holds 29.6% of shares in ZJE and gained effective
control from Hangzhou Jinjiang Group Co. Ltd. since August 2019.
S&P's assessment of ZJE's status in the group reflects our
following views:
-- ZPEG has been providing ZJE with various financial resources to
help reduce its financing cost. S&P believes the parent will also
support ZJE in refinancing the latter's outstanding
U.S.-dollar-denominated notes and improve its liquidity.
-- ZJE has changed its name and company logo to align with its new
parent. The close association with ZPEG's reputation and brand
underpins the group's incentive to support ZJE, if needed.
-- ZPEG exercises effective control over ZJE by appointing the
majority of executive directors in the board and senior management
team.
-- S&P expects ZPEG to further increase its shareholding in ZJE
rather than divest it in near term.
-- Further evidence will be required to assess ZJE's mid-to
long-term strategic position in the group, given its insignificant
contribution to ZPEG in terms of asset and profit size.
S&P said, "We believe ZPEG's credit profile is much stronger than
ZJE's, and that ZPEG is able and willing to provide sufficient
financial support to ZJE when necessary. ZPEG is a wholly owned
provincial state-owned enterprise (SOE) and is one of the largest
energy suppliers in Zhejiang province, predominantly focused on
power generation and gas supply.
"The stable outlook reflects our expectation that ZJE will improve
its cash generation following the new capacity commissioning and
facility upgrades, which will partly mitigate the negative effects
of the COVID-19 pandemic, as well as the pressure on leverage due
to its material cash outflow stemming from capacity expansion.
"We expect ZJE to maintain its FFO-to-debt at 6%-8% over the next
12-18 months. In our view, the company will fulfill its debt
obligations, including the U.S.-dollar-denominated bond maturing in
July 2020, with the support from ZPEG.
"We may lower the rating on ZJE if the company commits to
aggressive debt-funded capacity expansion, or more of its
facilities undergo technological upgrades or cease operations,
materially affecting the operation and financial performance of its
WTE segment. An indicator of weakened credit strength includes FFO
interest coverage falling below 1.75x, or FFO-to-debt ratio
dropping below 5.0%.
"We may also downgrade the company if: (1) ZJE's liquidity further
deteriorates while we no longer expect ZJE to receive timely and
tangible support from the parent; or (2) we expect the parent to
divest it shares in ZJE in the near term.
"We may upgrade ZJE if the company has adequate liquidity and
sustainably improves its FFO-to-debt ratio to 10% or above. This
could be due to a more prudent approach in managing its capital
spending as well as improving its capital structure (e.g. reducing
reliance on short-term debt), while the commencement of new WTE
facilities continues to improve the company's cash generation
ability."
=========
I N D I A
=========
BE BE RUBBER: CRISIL Lowers Rating on INR4.85cr Cash Loan to B-
---------------------------------------------------------------
CRISIL has downgraded its rating on the long term bank facilities
of The Be Be Rubber Estates Limited (TBBREL) to 'CRISIL B-/Stable'
from 'CRISIL B/Stable'.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Cash Credit 4.85 CRISIL B-/Stable (Downgraded
from 'CRISIL B/Stable')
Long Term Loan 2 CRISIL B-/Stable (Downgraded
from 'CRISIL B/Stable')
Proposed Long Term 0.38 CRISIL B-/Stable (Downgraded
Bank Loan Facility from 'CRISIL B/Stable')
The downgrade reflects continuous decline in the business and
financial risk profile. The company has reported modest revenue of
around INR2 crores in fiscal 2019, and estimated revenue of around
INR2.5 crores for the fiscal 2020. The growth is expected to be
flat during the medium term. Further, the company has been
incurring continuous losses at operating levels resulting into low
net cash accruals. Also, the capital structure was deteriorated due
to accumulated losses and low accretion to reserves. CRISIL
believes that the business and financial risk profile is expected
to remain weak in the medium term.
The rating reflect the firm's small scale of operations, intense
competition in the industry and weak financial risk profile.
However, these weaknesses are partially mitigated by the extensive
experience of the promoter in the rubber plantation industry of
over 9 decades.
Key Rating Drivers & Detailed Description
Weaknesses:
* Small scale of operations and intense competition: The scale of
the operations has remained modest, as indicated by the estimated
revenue of around INR2.5 crore in fiscal 2020, the same is
constrained by intense competition in the rubber plantation
industry. The industry has low entry barriers due to minimal
capital requirement, resulting in presence of several unorganized
players. Further, climatic conditions also played a major role in
the production.
* Weak financial risk profile: The company has a weak financial
risk profile due to modest net-worth and high gearing levels. The
net-worth was deteriorated due to accumulated loss incurred during
the past financial years. Further, the debt protection metrics was
also weak due to negative interest coverage and net cash accruals
to total debt.
Strength:
* Extensive experience of promoters in the industry: TBBREL enjoys
the extensive experience of the promoter in the rubber plantation
business of over 9 decades. Their longstanding experience has
helped them sustain in the industry, despite regular volatility.
Liquidity Stretched
The liquidity profile was stretched marked by high utilization of
bank limits at around 92% in the last twelve months ending February
2020. The firm has reported insufficient cash accruals against
repayment obligations, however, the expected need based funding
support from promoters will support the liquidity profile in the
medium term. The current ratio is estimated at around at 0.1 times
during FY2020.
Outlook: Stable
CRISIL believes that TBBREL will benefit over the medium term from
the extensive experience of the promoters and their established
relationships with suppliers and customers in trading business.
Rating Sensitivity factors
Upward Factors
* Improvement in the revenue profile and net cash accruals of more
than INR1 crores.
* Improvement in the working capital requirements.
Downward Factors
* Decline in the revenue profile and net cash accruals of less than
INR0.3 crores.
* Stretch in the working capital requirements.
Incorporated in the year 2007, TBBREL is engaged into production of
latex from rubber trees. The company owns 650 acres of land in
Kollom, Kerala, where it carries out rubber tree plantation.
Besides the company also has 121 acres of land in Palghar district
for plantation of Cardamom and Coffee.
BERTLING LOGISTICS: CRISIL Keeps B Debt Rating in Not Cooperating
-----------------------------------------------------------------
CRISIL said the ratings on bank facilities of Bertling Logistics
India Private Limited (Bertling) continues to be 'CRISIL
B/Stable/CRISIL A4 Issuer Not Cooperating'.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Bank Guarantee 12 CRISIL A4 (ISSUER NOT
COOPERATING)
Cash Credit 18 CRISIL B/Stable (ISSUER NOT
COOPERATING)
CRISIL has been consistently following up with Bertling for
obtaining information through letters and emails dated October 15,
2019 and April 11, 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 Bertling, which restricts
CRISIL's ability to take a forward looking view on the entity's
credit quality. CRISIL believes information available on Bertling
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 Bertling continues to be 'CRISIL B/Stable/CRISIL A4
Issuer Not Cooperating'.
Incorporated in 2007, Bertling provides project logistic services
such as freight forwarding and transportation to companies engaged
in the power, capital goods, and engineering sectors. GFA provides
custom clearance services. Bertling and GFA are based in Mumbai and
the group's overall financial operations are managed by Mr. M B
Narayanan, chief financial officer.
BHAGYODAYA MOTORS: CRISIL Lowers Rating on INR15cr Cash Loan to D
-----------------------------------------------------------------
CRISIL has downgraded its ratings on the bank facilities of
Bhagyodaya Motors Private Limited (BMPL) to 'CRISIL D/CRISIL D'
from 'CRISIL B-/Stable/CRISIL A4'.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Cash Credit 15 CRISIL D (Downgraded from
'CRISIL B-/Stable')
Channel Financing 1.75 CRISIL D (Downgraded from
'CRISIL A4')
Proposed Long Term 2.70 CRISIL D (Downgraded from
Bank Loan Facility 'CRISIL B-/Stable')
Standby Line 1 .00 CRISIL D (Downgraded from
of Credit 'CRISIL B-/Stable')
The downgrade reflects overutilization of its working capital limit
for more than 30 days, driven by poor liquidity.
The ratings also factors in the company's below-average financial
risk profile and susceptibility to intense competition in
automobile dealership segment. These weaknesses are partially
offset by established position in automobile dealership market for
TML in North Karnataka.
Key Rating Drivers & Detailed Description
Weaknesses:
* Delay in servicing of interest & over utilization of fund based
facility: BMPL has over utilized its fund based facility for more
than 30 days due stretched liquidity.
* Below-average financial risk profile: The BMPL's financial risk
profile is weak, marked by a high total outside liabilities to
tangible net worth (TOLTNW) ratio and weak debt protection metrics.
CRISIL believes that the company's financial risk profile is
expected to remain weak due to its working capital intensive
operations and high reliance on external bank debt.
* Susceptibility to intense competition in automobile dealership
segment: The BMPL's operations are concentrated in the North
Karnataka region, where it has all its sales outlets and service
centers. This exposes the company to geographical concentration as
any deterioration in the economy of the region will impact
automobile sales, which would affect automobile dealers.
Furthermore, the company has only Tata Motors Ltd (TML) dealership,
and has weak bargaining power in its transactions with TML. CRISIL
believes that the BMPL's business risk profile will remain
constrained over the medium term on account of its exposure to
risks related to geographical and supplier concentration, and to
intense competition in the automobile dealership segment.
Strength:
* Established position in automobile dealership market for TML in
North Karnataka: The promoters of the BMPL have over a decade of
experience in the automobile dealership business. Over these years,
the company has been able to build a strong brand image among its
customers in North Karnataka. It is the exclusive dealer for TML's
passenger cars and LCVs in three districts of North Karnataka.
CRISIL believes that the BMPL will benefit from its established
position as TML's dealer in the North Karnataka region, over the
medium term.
Liquidity Poor
BMPL has poor liquidity reflected by overutilization of fund based
working capital limit beyond 30 days.
Rating Sensitivity factors
Upward factors
* Track record of timely debt servicing for at least 90 days
* Sustainable improvement in financial risk profile and working
capital management
Set up in 1998 as a partnership firm, BMPL was reconstituted as a
private limited company in 2002. The company is the exclusive
authorized dealer for TML's passenger car in three districts -
Bellary, Koppal, and Raichur (all in Karnataka).
BREMELS RUBBER: CRISIL Keeps 'D' Debt Ratings in Not Cooperating
----------------------------------------------------------------
CRISIL said the ratings on bank facilities of Bremels Rubber
Industries Private Limited (Bremels) continues to be 'CRISIL
D/CRISIL D Issuer Not Cooperating'.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Bank Guarantee 2 CRISIL D (ISSUER NOT COOPERATING)
Bill Discounting 3 CRISIL D (ISSUER NOT COOPERATING)
Cash Credit 7 CRISIL D (ISSUER NOT COOPERATING)
Letter of Credit 2 CRISIL D (ISSUER NOT COOPERATING)
Term Loan 15 CRISIL D (ISSUER NOT COOPERATING)
CRISIL has been consistently following up with Bremels for
obtaining information through letters and emails dated October 15,
2019 and April 11, 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 Bremels, which restricts
CRISIL's ability to take a forward looking view on the entity's
credit quality. CRISIL believes information available on Bremels 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 Bremels continues to be 'CRISIL D/CRISIL D Issuer Not
Cooperating'.
Bremels, set up in 1971, manufactures tyre retreads used for
retreading worn-out tyres of heavy vehicles. It sells its products
under the Bremels brand. The company also manufactures solid tyres
for forklifts. It is setting up a solid tyre manufacturing unit at
the Padubidri special economic zone in Udupi (Karnataka). The capex
will add capacity of 0.15 million tyres per year.
BRINDAVAN SHELTERS: CRISIL Cuts Rating on INR10cr Loans to B+
-------------------------------------------------------------
CRISIL has revised the ratings on bank facilities of Brindavan
Shelters Private Limited (BSPL) to 'CRISIL B+/Stable Issuer Not
Cooperating' from 'CRISIL BB-/Stable Issuer Not Cooperating'.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Cash Credit 1 CRISIL B+/Stable (ISSUER NOT
COOPERATING; Revised from
'CRISIL BB-/Stable ISSUER NOT
COOPERATING')
Electronic Dealer 7 CRISIL B+/Stable (ISSUER NOT
Financing Scheme COOPERATING; Revised from
(e-DFS) 'CRISIL BB-/Stable ISSUER NOT
COOPERATING')
Proposed Long Term 2 CRISIL B+/Stable (ISSUER NOT
Bank Loan Facility COOPERATING; Revised from
'CRISIL BB-/Stable ISSUER NOT
COOPERATING')
CRISIL has been consistently following up with BSPL for obtaining
information through letters and emails dated October 15, 2019 and
April 11, 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 BSPL, which restricts CRISIL's
ability to take a forward looking view on the entity's credit
quality. CRISIL believes information available on BSPL 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 BSPL Revised to 'CRISIL B+/Stable Issuer Not
Cooperating' from 'CRISIL BB-/Stable Issuer Not Cooperating'.
BSPL was incorporated in 2007, promoted by Mr Vivek Ladhani and Mr
Parmanand Banwani. The company is an authorised dealer for
passenger cars of TML. It operates a showroom in Kanpur and a
showroom-cum-workshop in Rooma, both in Uttar Pradesh.
BRUCK PHARMA: CRISIL Keeps B INR19.2cr Debt Rating in Not Coop.
---------------------------------------------------------------
CRISIL said the ratings on bank facilities of Bruck Pharma Private
Limited (BPPL) continues to be 'CRISIL B/Stable Issuer Not
Cooperating'.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Term Loan 19.2 CRISIL B/Stable (ISSUER NOT
COOPERATING)
CRISIL has been consistently following up with BPPL for obtaining
information through letters and emails dated October 15, 2019 and
April 11, 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 BPPL, which restricts CRISIL's
ability to take a forward looking view on the entity's credit
quality. CRISIL believes information available on BPPL 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 BPPL continues to be 'CRISIL B/Stable Issuer Not
Cooperating'.
BPPL, incorporated in 1984, markets formulations. The company is
setting up a plant in Daman for manufacturing oncology products. It
is promoted by Mr Devendra Kejriwal and Mr Shirish Kejriwal.
D K CERAMIC: CRISIL Keeps 'D' Debt Ratings in Not Cooperating
-------------------------------------------------------------
CRISIL said the ratings on bank facilities of D K Ceramic (DKC)
continues to be 'CRISIL D/CRISIL D Issuer Not Cooperating'.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Bank Guarantee 1.25 CRISIL D (ISSUER NOT
COOPERATING)
Cash Credit 2.00 CRISIL D (ISSUER NOT
COOPERATING)
Proposed Long Term
Bank Loan Facility 5.05 CRISIL D (ISSUER NOT
COOPERATING)
Term Loan 4.20 CRISIL D (ISSUER NOT
COOPERATING)
CRISIL has been consistently following up with DKC for obtaining
information through letters and emails dated October 15, 2019 and
April 11, 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 DKC, which restricts CRISIL's
ability to take a forward looking view on the entity's credit
quality. CRISIL believes information available on DKC 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 DKC continues to be 'CRISIL D/CRISIL D Issuer Not
Cooperating'.
DKC is a Morbi, Gujarat-based partnership firm set up in 2014. The
firm manufactures ceramic wall and floor tiles.
DEV PRIYA: CRISIL Lowers Rating on INR30cr Cash Loan to B+
----------------------------------------------------------
CRISIL has revised the ratings on bank facilities of Dev Priya
Industries Private Limited (DPIPL) to 'CRISIL B+/Stable/CRISIL A4
Issuer Not Cooperating' from 'CRISIL BB+/Stable/CRISIL A4+ Issuer
Not Cooperating'.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Bank Guarantee 2 CRISIL A4 (ISSUER NOT
COOPERATING; Revised from
'CRISIL A4+ ISSUER NOT
COOPERATING')
Cash Credit 30 CRISIL B+/Stable (ISSUER NOT
COOPERATING; Revised from
'CRISIL BB+/Stable ISSUER NOT
COOPERATING')
Proposed Long Term 6.48 CRISIL B+/Stable (ISSUER NOT
Bank Loan Facility COOPERATING; Revised from
'CRISIL BB+/Stable ISSUER NOT
COOPERATING')
Rupee Term Loan 11.52 CRISIL B+/Stable (ISSUER NOT
COOPERATING; Revised from
'CRISIL BB+/Stable ISSUER NOT
COOPERATING')
CRISIL has been consistently following up with DPIPL for obtaining
information through letters and emails dated
October 15, 2019 and April 11, 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 DPIPL, which restricts CRISIL's
ability to take a forward looking view on the entity's credit
quality. CRISIL believes information available on DPIPL 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 DPIPL revised to 'CRISIL B+/Stable/CRISIL A4 Issuer
Not Cooperating' from 'CRISIL BB+/Stable/CRISIL A4+ Issuer Not
Cooperating'.
DPIPL manufactures waste paper-based kraft paper of 16-28 burst
factor at its two units in Meerut. The company started operations
in 1992 and has gradually enhanced its capacity to 200,000 tonne
per annum. It markets its kraft paper under the Dev brand.
DRILLCON INFRASTRUCTURE: CRISIL Cuts Rating on INR8cr Loan to B+
----------------------------------------------------------------
CRISIL has revised the ratings on bank facilities of Drillcon
Infrastructure Private Limited (DIPL) to 'CRISIL B+/Stable/CRISIL
A4 Issuer Not Cooperating' from 'CRISIL BB+/Stable/CRISIL A4+
Issuer Not Cooperating'.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Bank Guarantee 10 CRISIL A4 (ISSUER NOT
COOPERATING; Revised from
'CRISIL A4+ ISSUER NOT
COOPERATING')
Cash Credit 8 CRISIL B+/Stable (ISSUER NOT
COOPERATING; Revised from
'CRISIL BB+/Stable ISSUER NOT
COOPERATING')
CRISIL has been consistently following up with DIPL for obtaining
information through letters and emails dated October 15, 2019 and
April 11, 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 DIPL, which restricts CRISIL's
ability to take a forward looking view on the entity's credit
quality. CRISIL believes information available on DIPL 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 DIPL revised to 'CRISIL B+/Stable/CRISIL A4 Issuer
Not Cooperating' from 'CRISIL BB+/Stable/CRISIL A4+ Issuer Not
Cooperating'.
DIPL was established by Mr S K Chakravorty and his son Mr. Amit
Chakravorty in 2009. It provides infrastructure related services
such as tunnelling, drilling and grouting, and allied activities
such as foundation treatment, seepage control, instrumentation for
dams and tunnels, and geotechnical investigations.
GOVIND STEEL: CRISIL Lowers Rating on INR10cr Cash Loan to B+
-------------------------------------------------------------
CRISIL has downgraded the ratings on bank facilities of Govind
Steel Co Limited (GSCL; part of the Dinesh group) to 'CRISIL
B+/Stable/CRISIL A4 Issuer Not Cooperating' from 'CRISIL
BB-/Stable/CRISIL A4+ Issuer Not Cooperating'.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Cash Credit 10 CRISIL B+/Stable (ISSUER NOT
COOPERATING; Revised from
'CRISIL BB-/Stable ISSUER NOT
COOPERATING')
Letter of Credit 3 CRISIL A4 (ISSUER NOT
COOPERATING; Revised from
'CRISIL A4+ ISSUER NOT
COOPERATING')
Proposed Fund- 7 CRISIL B+/Stable (ISSUER NOT
Based Bank Limits COOPERATING; Revised from
'CRISIL BB-/Stable ISSUER NOT
COOPERATING')
CRISIL has been consistently following up with GSCL for obtaining
information through letters and emails dated October 15, 2019 and
April 11, 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 GSCL, which restricts CRISIL's
ability to take a forward looking view on the entity's credit
quality. CRISIL believes information available on GSCL 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 GSCL revised to 'CRISIL B+/Stable/CRISIL A4 Issuer
Not Cooperating' from 'CRISIL BB-/Stable/CRISIL A4+ Issuer Not
Cooperating'.
For arriving at its ratings, CRISIL has combined the business and
financial risk profiles of GSCL and Dinesh Brothers Pvt Ltd (DBPL).
This is because the two companies, together referred to as the
Dinesh group, are under the same management and have significant
operational and financial linkages with each other. DBPL is the
trading arm of GSCL.
Incorporated in 1962, GSCL manufactures cast iron products such as
manhole sets and manhole grates, and also steel casting for
manufacturing ingots. About 20 per cent of the company's products
are sold to DBPL for export to the US, the Middle East, and
Germany, and the rest are sold in India. GSCL is also an approved
supplier of counter pulleys for the Indian Railways; this, however,
contributes to a miniscule portion of its total revenue.
DBPL was established in 1992 by the Seksaria family of West Bengal.
The company trades in cast iron products such as manhole sets,
manhole grates, and water meters, used in road construction. These
products are primarily manufactured by GSCL.
HILLWOOD FURNITURE: CRISIL Keeps D Debt Ratings in Not Coop.
------------------------------------------------------------
CRISIL said the ratings on bank facilities of Hillwood Furniture
Private Limited (HFPL) continues to be 'CRISIL D/CRISIL D Issuer
Not Cooperating'.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Bank Guarantee .50 CRISIL D (ISSUER NOT
COOPERATING)
Cash Credit 3.00 CRISIL D (ISSUER NOT
COOPERATING)
Letter of Credit 35.00 CRISIL D (ISSUER NOT
COOPERATING)
CRISIL has been consistently following up with HFPL for obtaining
information through letters and emails dated October 15, 2019 and
April 11, 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 HFPL, which restricts CRISIL's
ability to take a forward looking view on the entity's credit
quality. CRISIL believes information available on HFPL 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 HFPL continues to be 'CRISIL D/CRISIL D Issuer Not
Cooperating'.
HFPL based in Kerala, were incorporated in 2001-02 and process
timber logs. HFPL also manufactures building materials such as
window, door, and kitchen frames. HFPL primarily deals in teakwood,
while HIEPL deals mostly in hardwood.
INARCO PRIVATE: CRISIL Lowers Rating on INR4cr Cash Loan to B+
--------------------------------------------------------------
CRISIL has downgraded the ratings on bank facilities of INARCO
Private Limited (Inarco) to 'CRISIL B+/Stable/CRISIL A4 Issuer Not
Cooperating' from 'CRISIL BB+/Stable/CRISIL A4+ Issuer Not
Cooperating'.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Bank Guarantee .25 CRISIL A4 (ISSUER NOT
COOPERATING; Revised from
'CRISIL A4+ ISSUER NOT
COOPERATING')
Cash Credit 4.00 CRISIL B+/Stable (ISSUER NOT
COOPERATING; Revised from
'CRISIL BB+/Stable ISSUER
NOT COOPERATING')
Letter of Credit 5.50 CRISIL A4 (ISSUER NOT
COOPERATING; Revised from
'CRISIL A4+ ISSUER NOT
COOPERATING')
Proposed Long Term 0.25 CRISIL A4 (ISSUER NOT
Bank Loan Facility COOPERATING; Revised from
'CRISIL A4+ ISSUER NOT
COOPERATING')
CRISIL has been consistently following up with Inarco for obtaining
information through letters and emails dated October 15, 2019 and
April 11, 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 Inarco, which restricts CRISIL's
ability to take a forward looking view on the entity's credit
quality. CRISIL believes information available on Inarco 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 Inarco revised to 'CRISIL B+/Stable/CRISIL A4 Issuer
Not Cooperating' from 'CRISIL BB+/Stable/CRISIL A4+ Issuer Not
Cooperating'.
Inarco, based in Mumbai, is a wholly owned subsidiary of Associated
Rubber Industries Consolidated Investments Pvt Ltd (ARI). Inarco
manufactures textile machine components, primarily, rubber aprons
and cots.
INNOVATIVE LOGISTICS: CRISIL Cuts Rating on INR5.20cr Loan to B+
----------------------------------------------------------------
CRISIL has downgraded the ratings on bank facilities of Innovative
Logistics Service Private Limited (ILSPL) to 'CRISIL
B+/Stable/CRISIL A4 Issuer Not Cooperating' from 'CRISIL
BB+/Stable/CRISIL A4+ Issuer Not Cooperating'.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Bank Guarantee .30 CRISIL A4 (ISSUER NOT
COOPERATING; Revised from
'CRISIL A4+ ISSUER NOT
COOPERATING')
Cash Credit 5.20 CRISIL B+/Stable (ISSUER NOT
COOPERATING; Revised from
'CRISIL BB+/Stable ISSUER NOT
COOPERATING')
CRISIL has been consistently following up with ILSPL for obtaining
information through letters and emails dated October 15, 2019 and
April 11, 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 ILSPL, which restricts CRISIL's
ability to take a forward looking view on the entity's credit
quality. CRISIL believes information available on ILSPL 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 ILSPL revised to 'CRISIL B+/Stable/CRISIL A4 Issuer
Not Cooperating' from 'CRISIL BB+/Stable/CRISIL A4+ Issuer Not
Cooperating'.
Incorporated in 2011 and based in Kolkata, ILSPL is promoted by Mr
Mohan Jha and his wife, Mrs Madhusnata Jha, who have an overall
experience of more than 15 years in the transportation and
logistics industry. The company undertakes transportation and
warehousing of fast-moving consumer goods, electronics, and retail
products.
INTOUCH MOBICARE: CRISIL Keeps B+ INR4cr Debt Rating in Not Coop.
-----------------------------------------------------------------
CRISIL said the ratings on bank facilities of Intouch Mobicare
Private Limited (IMPL) continues to be 'CRISIL B+/Stable/CRISIL A4
Issuer Not Cooperating'.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Bank Guarantee 1.5 CRISIL A4 (ISSUER NOT
COOPERATING)
Cash Credit 4.0 CRISIL B+/Stable (ISSUER NOT
COOPERATING)
CRISIL has been consistently following up with IMPL for obtaining
information through letters and emails dated October 15, 2019 and
April 11, 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 IMPL, which restricts CRISIL's
ability to take a forward looking view on the entity's credit
quality. CRISIL believes information available on IMPL 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 IMPL continues to be 'CRISIL B+/Stable/CRISIL A4
Issuer Not Cooperating'.
IMPL promoted in 2010 by Mr. Anand Gulati and his brother, Mr.
Rajat Gulati. IMPL is in to distribution and marketing of mobile
accessories. It is an exclusive distributor of Samsung mobile
accessories in Delhi, Gurgaon and Faridabad. The company is also
engaged in distributorship of Titan Watches.
IVORY CLOTHING: CRISIL Keeps B+ INR1cr Loan Rating in Not Coop.
---------------------------------------------------------------
CRISIL said the ratings on bank facilities of Ivory Clothing
Private Limited (ICPL) 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)
Packing Credit 5 CRISIL A4 (ISSUER NOT
COOPERATING)
CRISIL has been consistently following up with ICPL for obtaining
information through letters and emails dated October 15, 2019 and
April 11, 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 ICPL, which restricts CRISIL's
ability to take a forward looking view on the entity's credit
quality. CRISIL believes information available on ICPL 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 ICPL continues to be 'CRISIL B+/Stable/CRISIL A4
Issuer Not Cooperating'.
Incorporated in 2005, by Mr. Aniljit Singh ICPL manufactures and
exports ready-made garments for women. Facility is in Noida.
JAWAHAR EDUCATION: CRISIL Keeps D INR31cr Debt Rating in Not Coop.
------------------------------------------------------------------
CRISIL said the ratings on bank facilities of Jawahar Education
Society (JES) continues to be 'CRISIL D Issuer Not Cooperating'.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Rupee Term Loan 31 CRISIL D (ISSUER NOT
COOPERATING)
CRISIL has been consistently following up with JES for obtaining
information through letters and emails dated October 15, 2019 and
April 11, 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 JES, which restricts CRISIL's
ability to take a forward looking view on the entity's credit
quality. CRISIL believes information available on JES 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 JES continues to be 'CRISIL D Issuer Not
Cooperating'.
JES was founded in 1991 by Mr. Annasaheb Patil. It runs two
colleges and one school in Maharashtra, which are A C Patil College
of Engineering and Technology, Jawahar Institute of Technology,
Management and Research and North Point School. The trust is
managed by Mr. Vinay Patil and Mr. Kamal Patil.
JOSAN RICE: CRISIL Maintains B+ Debt Ratings in Not Cooperating
---------------------------------------------------------------
CRISIL said the ratings on bank facilities of Josan Rice Mills
(JRM; part of the Josan group) continues to be 'CRISIL B+/Stable
Issuer Not Cooperating'.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Cash Credit 10 CRISIL B+/Stable (ISSUER NOT
COOPERATING)
Warehouse Financing 2 CRISIL B+/Stable (ISSUER NOT
COOPERATING)
CRISIL has been consistently following up with JRM for obtaining
information through letters and emails dated October 15, 2019 and
April 11, 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 JRM, which restricts CRISIL's
ability to take a forward looking view on the entity's credit
quality. CRISIL believes information available on JRM 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 JRM continues to be 'CRISIL B+/Stable Issuer Not
Cooperating'.
For arriving at the ratings, CRISIL has combined the business and
financial risk profiles of JRM and Josan Industries (JI). This is
because the two firms, together referred to as the Josan group,
have common promoters and management, are in the same line of
business, and have considerable operational linkages.
The Josan group, promoted by the Josan family of Jalalabad
(Punjab), processes rice and deals in varieties of basmati, such as
1121. In the non-basmati segment, it processes the PR 11 variety.
JRM, established in 1988, has a milling facility in Jalalabad, with
installed capacity of 4 tonnes per hour (tph). Operations are
managed by Mr Hukam Chand and his nephew, Mr Jashan Preet Josan.
JI was established in 1995. The facility, also based in Jalalabad,
has an installed milling capacity of 4 tph. Operations are managed
by three brothers of Mr Hukam Chand - Mr Harbhagwan Josan, Mr Raj
Kumar Josan, and Mr Surinder Kumar Josan.
KHUSHI COTSPIN: CRISIL Keeps B Debt Ratings in Not Cooperating
--------------------------------------------------------------
CRISIL said the ratings on bank facilities of Khushi Cotspin
Private Limited (KCPL) continues to be 'CRISIL B/Stable Issuer Not
Cooperating'.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Cash Credit 4.3 CRISIL B/Stable (ISSUER NOT
COOPERATING)
Term Loan 1.3 CRISIL B/Stable (ISSUER NOT
COOPERATING)
CRISIL has been consistently following up with KCPL for obtaining
information through letters and emails dated October 15, 2019 and
April 11, 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 KCPL, which restricts CRISIL's
ability to take a forward looking view on the entity's credit
quality. CRISIL believes information available on KCPL 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 KCPL continues to be 'CRISIL B/Stable Issuer Not
Cooperating'.
Incorporated in 2012, KCPL is engaged in ginning of raw cotton at
its facility in Akot, Maharashtra. It also trades cotton seeds and
cotton bales.
PPG is a partnership firm engaged in the business of ginning raw
cotton and sale of cotton lint, seed and seed cake. Its unit is
also located in Akot. Both the companies are promoted by Mr
Navinkumar Chandak and his family.
KRISHNA AND COMPANY: CRISIL Cuts Rating on INR10cr Loan to B+
-------------------------------------------------------------
CRISIL has downgraded the ratings on bank facilities of Krishna and
Company - Korba (KAC) to 'CRISIL B+/Stable Issuer Not Cooperating'
from 'CRISIL BB-/Stable Issuer Not Cooperating'.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Cash Credit 10 CRISIL B+/Stable (ISSUER NOT
COOPERATING; Revised from
'CRISIL BB-/Stable ISSUER NOT
COOPERATING')
CRISIL has been consistently following up with KAC for obtaining
information through letters and emails dated October 15, 2019 and
April 11, 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 KAC, which restricts CRISIL's
ability to take a forward looking view on the entity's credit
quality. CRISIL believes information available on KAC 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 KAC Revised to 'CRISIL B+/Stable Issuer Not
Cooperating' from 'CRISIL BB-/Stable Issuer Not Cooperating'.
KAC was set up in 2001 as a proprietorship firm by Mr Sanjay Modi
in Korba, Chhattisgarh. The firm is an authorised dealer of Tata
Motors Ltd (TML; rated 'CRISIL AA/Stable/CRISIL A1+') for its
entire range of commercial vehicles. Currently, the firm is
operating through one showroom in Korba (3S) and two satellite
outlets in Ambikapur and Raigarh (both in Chhattisgarh). It also
derives part of its revenue from supply and erection of electrical
panels for government agencies.
LEADE LIQUOR: CRISIL Keeps 'D' Debt Ratings in Not Cooperating
--------------------------------------------------------------
CRISIL said the ratings on bank facilities of Leade Liquor
Manufacturing Private Limited (LLMPL) continues to be 'CRISIL D
Issuer Not Cooperating'.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Proposed Long Term 6.84 CRISIL D (ISSUER NOT
Bank Loan Facility COOPERATING)
Term Loan 2.91 CRISIL D (ISSUER NOT
COOPERATING)
CRISIL has been consistently following up with LLMPL for obtaining
information through letters and emails dated October 15, 2019 and
April 11, 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 LLMPL, which restricts CRISIL's
ability to take a forward looking view on the entity's credit
quality. CRISIL believes information available on LLMPL 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 LLMPL continues to be 'CRISIL D Issuer Not
Cooperating'.
LLMPL was set up in fiscal 2011, by the promoter, Mr Sumit Kumar
Jain and his family members, for setting up an IMFL bottling plant
at Hooghly. The plant commenced commercial operations in December
2012. The company has a bottling capacity of around 150,000 cases
per month.
MAA ANNAPURNA: CRISIL Keeps 'B' Debt Ratings in Not Cooperating
---------------------------------------------------------------
CRISIL said the ratings on bank facilities of Maa Annapurna Jute
And Carpets Industries Private Limited (MACIPL) continues to be
'CRISIL B/Stable Issuer Not Cooperating'.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Cash Credit 3.35 CRISIL B/Stable (ISSUER NOT
COOPERATING)
Term Loan 10.00 CRISIL B/Stable (ISSUER NOT
COOPERATING)
CRISIL has been consistently following up with MACIPL for obtaining
information through letters and emails dated October 15, 2019 and
April 11, 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 MACIPL, which restricts CRISIL's
ability to take a forward looking view on the entity's credit
quality. CRISIL believes information available on MACIPL 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 MACIPL continues to be 'CRISIL B/Stable Issuer Not
Cooperating'.
Incorporated in March 2016, MACIPL is setting up a manufacturing
unit for jute sack bags and yarn at Gangarampur, West Bengal.
MADHUBAN BUILDERS: CRISIL Keeps D INR8cr Loan Rating in Not Coop.
-----------------------------------------------------------------
CRISIL said the ratings on bank facilities of Madhuban Builders
(MB) continues to be 'CRISIL D Issuer Not Cooperating'.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Term Loan 8 CRISIL D (ISSUER NOT COOPERATING)
CRISIL has been consistently following up with MB for obtaining
information through letters and emails dated October 15, 2019 and
April 11, 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 MB, which restricts CRISIL's
ability to take a forward looking view on the entity's credit
quality. CRISIL believes information available on MB 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 MB continues to be 'CRISIL D Issuer Not
Cooperating'.
MB was established by Mr Rajesh Majethia in 1996 as a
proprietorship firm to undertake residential real estate
development in Pune. The firm has one ongoing residential project,
Serene Spaces, which has 108 saleable units.
MANGALA ELECTRICALS: CRISIL Lowers Rating on INR2.5cr Loan to D
---------------------------------------------------------------
CRISIL has downgraded the ratings on bank facilities of Mangala
Electricals (ME) to 'CRISIL D/CRISIL D Issuer Not Cooperating' from
'CRISIL B/Stable/A4 Issuer Not Cooperating' due to delays in
servicing debt obligations.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Bank Guarantee 2.5 CRISIL D (ISSUER NOT
COOPERATING; Downgraded
from 'CRISIL A4 ISSUER
NOT COOPERATING')
Open Cash Credit 2.5 CRISIL D (ISSUER NOT
COOPERATING; Downgraded
from 'CRISIL B/Stable
ISSUER NOT COOPERATING')
Proposed Long Term 1.0 CRISIL D (ISSUER NOT
Bank Loan Facility COOPERATING; Downgraded
from 'CRISIL B/Stable
ISSUER NOT COOPERATING')
CRISIL has been consistently following up with ME for obtaining
information through letters and emails dated August 31, 2018,
February 14, 2019 and November 30th, 2019 among others, apart from
telephonic communication. However, the issuer has remained non
cooperative.
'The investors, lenders and all other market participants should
exercise due caution while using the rating assigned/reviewed with
the suffix 'ISSUER NOT COOPERATING'. These ratings lack a forward
looking component as it is arrived at without any management
interaction and is based on best available or limited or dated
information on the company'.
Detailed Rationale
Despite repeated attempts to engage with the management, CRISIL
failed to receive any information on either the financial
performance or strategic intent of ME, which restricts CRISIL's
ability to take a forward looking view on the entity's credit
quality. CRISIL believes information available on ME is consistent
with 'Scenario 1' outlined in the 'Framework for Assessing
Consistency of Information with CRISIL BB' rating category or
lower'.
Based on public information, the ratings on bank facilities of ME
has been downgraded to 'CRISIL D/CRISIL D Issuer Not Cooperating'
from 'CRISIL B/Stable/A4 Issuer Not Cooperating' due to delays in
servicing debt obligations.
Established in 1981 as a proprietorship firm, ME, is a Mangalore
(Karnataka) based electrical contractor. The firm primarily
undertakes erection of transmission lines. The day to day
operations of the firm are managed by Mr. G. Bhaskar Bhat.
METAL CRAFT: CRISIL Lowers Rating on INR10cr Cash Loan to B+
------------------------------------------------------------
CRISIL has downgraded the ratings on bank facilities of Metal Craft
Engineering Private Limited (MCEPL) to 'CRISIL B+/Stable Issuer Not
Cooperating' from 'CRISIL BB/Stable Issuer Not Cooperating'.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Cash Credit 10 CRISIL B+/Stable (ISSUER NOT
COOPERATING; Revised from
'CRISIL BB/Stable ISSUER NOT
COOPERATING')
CRISIL has been consistently following up with MCEPL for obtaining
information through letters and emails dated October 15, 2019 and
April 11, 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 MCEPL, which restricts CRISIL's
ability to take a forward looking view on the entity's credit
quality. CRISIL believes information available on MCEPL 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 MCEPL Revised to 'CRISIL B+/Stable Issuer Not
Cooperating' from 'CRISIL BB/Stable Issuer Not Cooperating'.
MCEPL, based in Kolkata, was set up by Mr. Sanjay Todi and his
father, Mr. Mahabir Prasad Todi, in 2004. The company processes and
fabricates heavy engineering structurals, with capacity of 900
tonne per month. It operates primarily as a vendor and supplies
boiler auxiliaries to engineering, procurement, and construction
contractors in the power sector. It also manufactures other
engineering products such as gearboxes.
MY FONE: CRISIL Keeps 'D' INR5cr Cash Rating in Not Cooperating
---------------------------------------------------------------
CRISIL said the ratings on bank facilities of MY Fone Teleservices
Private Limited (MFTPL) continues to be 'CRISIL D Issuer Not
Cooperating'.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Cash Credit 5 CRISIL D (ISSUER NOT COOPERATING)
CRISIL has been consistently following up with MFTPL for obtaining
information through letters and emails dated October 15, 2019 and
April 11, 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 MFTPL, which restricts CRISIL's
ability to take a forward looking view on the entity's credit
quality. CRISIL believes information available on MFTPL 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 MFTPL continues to be 'CRISIL D Issuer Not
Cooperating'.
MFTPL, founded in Bhopal (Madhya Pradesh) in 2008, by Mr. Saurabh
Garg and his family members, distributes mobile handsets and
accessories; and computers and laptops of various brands in Bhopal
(Madhya Pradesh).
R.K. STEEL: CRISIL Lowers Rating on INR15cr Cash Loan to B+
-----------------------------------------------------------
CRISIL has downgraded the ratings on bank facilities of R.K. Steel
Industries (RKSI) to 'CRISIL B+/Stable Issuer Not Cooperating' from
'CRISIL BB-/Stable Issuer Not Cooperating'.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Cash Credit 15 CRISIL B+/Stable (ISSUER NOT
COOPERATING; Revised from
'CRISIL BB-/Stable ISSUER NOT
COOPERATING')
CRISIL has been consistently following up with RKSI for obtaining
information through letters and emails dated October 15, 2019 and
April 11, 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 RKSI, which restricts CRISIL's
ability to take a forward looking view on the entity's credit
quality. CRISIL believes information available on RKSI 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 RKSI Revised to 'CRISIL B+/Stable Issuer Not
Cooperating' from 'CRISIL BB-/Stable Issuer Not Cooperating'.
RKSI, set up in 1990, is promoted by Mr. Rakesh Kumar. It trades in
iron and steel bars, flats, plates, and sheets, and is based in
Ludhiana, Punjab.
SHIVANI LOCKS: CRISIL Migrates INR25cr Term Loan Rating to B+
-------------------------------------------------------------
Due to inadequate information and in line with the Securities and
Exchange Board of India guidelines, CRISIL had migrated its rating
on the long term bank facilities of Shivani Locks Private Limited
(SLPL) to 'CRISIL BB/Stable Issuer Not Cooperating' vide Rating
Rationale dated January 17, 2020. However, SLPL has subsequently
provided the necessary information and CRISIL has migrated the
rating to 'CRISIL B+/Stable' from 'CRISIL BB/Stable Issuer Not
Cooperating'. CRISIL has also reassigned its 'CRISIL A4' rating to
the company's short-term facilities.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Cash Credit 15 CRISIL B+/Stable (Migrated from
'CRISIL BB/Stable ISSUER NOT
COOPERATING')
Letter of Credit 1 CRISIL A4 (Reassigned)
Proposed Long Term 4 CRISIL B+/Stable (Migrated from
Bank Loan Facility 'CRISIL BB/Stable ISSUER NOT
COOPERATING')
Term Loan 25 CRISIL B+/Stable (Migrated from
'CRISIL BB/Stable ISSUER NOT
COOPERATING')
The rating action reflects significant deterioration in financial
risk profile. The Total outside liabilities to total net worth has
deteriorated to 5.7 times as on 31st March 2020 from 4.43 times as
on 31st March 2018, due to significant debt funded capital
expenditure undertaken over the last three fiscals ending FY2020.
The debt funded capital expenditure has led to increase in fixed
debt obligation to around INR16.55 crores in FY20. However, due to
lower expected turnover and constrained profitability, the net cash
accruals are expected to be lower at around INR9 crores in FY20.
Hence, the NCA/LTD ratio has significantly deteriorated to 0.44
time in FY2020 from around 2 times in FY2018, implying
deterioration in overall financial flexibility of the group. The
gap between net cash accruals and repayment is expected to remain
significant in FY21 also. The rating factors in support from
promoters in terms of unsecured loans in time bound manner.
With nation-wide lockdown since 24th March 2020 to combat COVID-19,
the business and financial risk profiles is expected to remain
impacted. That said, the ability of the business to revert back to
operational stability and any relief measures given by the
government will be a key monitorable, and CRISIL will continue
monitoring these events.
The ratings on the bank facilities of SLPL reflects susceptibility
of margins to volatility in raw material prices and weak financial
risk profile. These strengths are partially offset by extensive
experience of the promoters in the industry with established
customer base and diversified product profile.
Analytical Approach
CRISIL has consolidated the business and financial risk profile of
SLPL with its group companies Venus Stampings Private Limited
(VSPL) and Venus Industrial Corporation Pvt Ltd (VICPL), together
referred as the Venus group, as all the companies are engaged in
similar line of business and have common management.
Key Rating Drivers & Detailed Description
Weaknesses:
* Weak financial risk profile: Financial risk profile is weak, as
reflected in high TOL/TNW of 5.7 times as on 31st March 2020 and
weakened debt protection metrics. The interest coverage has
deteriorated to 1.6 times in FY20 from 3 times in FY2018 and NCAAD
of 0.06 time in FY20 from 0.21 time in FY2018. Going forward, the
financial risk profile is expected to remain weak due to
deterioration in overall business risk profile.
* Susceptibility of margins to volatility in raw material prices:
The main raw material is steel coils and sheets. The prices of
steel have been volatile in the past. Because of the competitive
nature of the business, the company has limited ability to pass on
the price hike to its customers. This is also reflected in its low
and volatile operating margin between 2.5-5.5% over last three
years ending fiscal 2020.
Strength:
* Extensive experience of promoters in the industry with
established customer base: The group's promoters have been in the
precision component industry for more than three decades, and have
developed understanding of the dynamics of the industry and local
market, which has helped the group expand its product portfolio and
establish strong customer relationships leading to repeat orders.
This has led to a moderate scale of operations reflected in
turnover of INR543.7 crores in FY2020.
Liquidity Poor
Liquidity is weak marked by Bank line utilization of an average of
75% for the past 12 months ending March 2020. Further, the net cash
accruals are expected to be around INR1-2 crores in FY21 against
repayment of INR16.55 crores. The deficit is expected to be met
through infusion of unsecured loans and higher bank limit
utilization. The unsecured loans is at INR14.75 crores as on 31st
March 2020.
Outlook: Stable
CRISIL believes that Venus group will benefit over the medium term
from its promoters' extensive experience in the auto components
industry.
Rating Sensitivity factors
Upward factors
* Improvement in scale of operations and operating margins leading
to net cash accruals of more than INR20 crores
* Improvement in financial risk profile
Downward factors
* Deterioration in operating margins to below 3%
* Stretch in liquidity profile marked by bank limit utilization
beyond 95%.
SLPL was incorporated in 1988 by Mr. D N Kathuria, Mr. K L
Kathuria, Mr. Naresh Kathuria and Mr. Raj Kathuria. The company is
engaged in the manufacturing of precision sheet metal components,
primarily, to the automotive industry. The company's manufacturing
facilities are situated at Faridabad, Haryana.
VICPL was incorporated in 1996 by Mr. D N Kathuria, Mr. R D
Kathuria & Mr. K L Kathuria. The company is engaged in the
manufacturing of precision sheet metal components, primarily, to
the automotive industry. The company's manufacturing facilities are
situated at Faridabad, Haryana.
VSPL was incorporated in 1985 by Mr. KrishanLal Kathuria and
family. The company is engaged into manufacturing of electrical
lamination for electric motors, starter motors, alternators, wiper
motors, radiator fan motors, switch gear controls and energy
meters. The company's manufacturing facilities are situated at
Faridabad, Haryana.
SIRSA BANSIVAT: CRISIL Lowers Rating on INR10cr Loans to 'D'
------------------------------------------------------------
CRISIL has downgraded its ratings on the bank facilities of The
Sirsa Bansivat Labour And Construction Private Limited (Sirsa) to
'CRISIL D/CRISIL D Issuer Not Cooperating' from 'CRISIL
BB-/Stable/CRISIL A4+ Issuer Not Cooperating'.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Bank Guarantee 7 CRISIL D (ISSUER NOT
COOPERATING; Downgraded from
'CRISIL A4+ ISSUER NOT
COOPERATING')
Cash Credit 3 CRISIL D (ISSUER NOT
COOPERATING; Downgraded from
'CRISIL BB-/Stable ISSUER NOT
COOPERATING')
CRISIL has been consistently following up with Sirsa for obtaining
information through letters and emails dated February 29, 2020,
March 2, 2020 and March 6, 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 Sirsa, which restricts CRISIL's
ability to take a forward looking view on the entity's credit
quality. CRISIL has downgraded its ratings on the bank facilities
of Sirsa to 'CRISIL D/CRISIL D Issuer Not Cooperating' from 'CRISIL
BB-/Stable/CRISIL A4+ Issuer Not Cooperating'.
The downgrades reflect overutilization in cash credit limit for
more than 30 days, on account of invocation in Bank Guarantee.
Set up in 2005, Sirsa offers manpower to various electricity
departments in Haryana and Rajasthan. The company has contracts
with Dakhin Haryana Bijli Vitran Nigam, Haryana Vidyut Prasaran
Nigam Ltd, Uttar Haryana Bijli Vitran Nigam, Ajmer Vidyut Vitran
Nigam Ltd, Jodhpur Vidyut Vitran Nigam Ltd, and other government
departments.
VARNIKA JEWELLERS: CRISIL Reaffirms B+ Rating on INR5.4cr Loan
--------------------------------------------------------------
CRISIL has reaffirmed its 'CRISIL B+/Stable/CRISIL A4' ratings on
the bank facilities of Varnika Jewellers - Coimbatore (VJC)
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Bank Guarantee 5.6 CRISIL A4 (Reaffirmed)
Cash Credit 5.4 CRISIL B+/Stable (Reaffirmed)
CRISIL ratings on the bank facilities of VJC continue to reflect
the company's modest scale of operations in the intensely
competitive jewellery industry and the weak financial risk profile.
These weaknesses are partially offset by the extensive industry
experience of the partners.
Key Rating Drivers & Detailed Description
Weaknesses
* Modest scale of operations in the intensely competitive jewellery
industry: The firm has a modest scale of operations as indicated
by the estimated revenues of INR19.5 crore in fiscal 2020 (INR17.77
crore in fiscal 2019). Also, the firm operates in a highly
fragmented industry that is dominated by the players in the
unorganised sector. These factors will continue to constrain the
business risk profile and benefits associated with economies of
scale.
* Weak financial risk profile: Financial risk profile is weak
marked by small networth estimated at around INR 10 crores as on
March 31, 2020 (INR9.59 crore as on March 31, 2019). Debt
protection metrics is also modest: interest coverage is estimated
at 1.63 time and net cash accrual to total debt (NCATD) of 0.06
times as on March 31, 2020 (1.53 times and 0.05 times respectively
as on March 31, 2019). Gearing is however estimated to remain low
at 0.70 times as on March 31, 2020 (0.69 times as on March 31,
2019).
Strength
* Extensive industry experience of the partners: The partners have
more than six-decade-long experience in the gold and diamond
jewellery industry which has given them a strong understanding of
the market dynamics. This will continue to support the business
profile of the firm.
Liquidity Stretched
The firm's working capital limits of INR4.4 crores is utilised on
an average at around 79.55% over the past 12 months through March
2020. Further the cash accruals, is expected to be modest in the
range of INR 0.35 crores to INR0.40 crores, against which it does
not have any term debt obligations.
Outlook: Stable
CRISIL believes VJC will continue to benefit from the extensive
industry experience of its promoters.
Rating Sensitivity Factors
Upward factors:
* Healthy revenue growth and improved operating profitability
leading to better cash accrual of over INR1 crore
* Significant improvement in financial risk profile
Downward factors:
* Decline in net cash accrual below INR0.25 crore on account of
fall in revenue or operating profit
* Deterioration in liquidity and financial risk profile due to
substantial increase in working capital requirement or debt funded
capex plans.
Established in November 2017, VJC operates a jewellery showroom at
Coimbatore. It is owned and managed by Mr AV Vallikkannu, Mr AVV
Saravanan, Ms AVV Palaniammal, and Ms S Rajeswari.
[*] INDIA: To Privatise State-Run Companies Amid COVID-19 Pandemic
------------------------------------------------------------------
Reuters reports that India said on May 17 it would privatise
state-run companies in non-strategic sectors and stop fresh
insolvency cases for a year, as the country battles with the
economic fallout from the coronavirus pandemic.
A list of strategic sectors will also be announced in which only
one to four public sector enterprises will remain, Finance Minister
Nirmala Sitharaman said, as part of a slew of measures to kickstart
the economy, Reuters relates.
Indian officials said most of the privatisations would happen in
the next fiscal year, starting April 2021.
According to Reuters, India has been trying to divest parts of
state-run companies in sectors ranging from aviation to power to
fill its coffers, but it has confronted weak investor sentiment and
limited demand.
"Such measures have to be done at times the government can get the
right price," Shriram Subramanian, founder of proxy advisory firm
InGovern, adding that the intention was good.
He said that in order to attract private investors, the government
needed to improve the efficiency of state-run companies by freeing
boards from interference by bureaucrats and "shed lot of flab" by
cutting their labour force and hiring the right talent, Reuters
relays.
Reuters notes that the government's revenues have been hit hard as
a nationwide lockdown imposed in March to prevent the spread of the
novel coronavirus has ground the economy, Asia's third largest, to
a halt.
The finances of Indian states have also been tipped into disarray,
barring a few well-managed ones, because of the losses of tax
revenues from fuel to stamp duties, Reuters says.
[*] INDIA: To Put on Hold Bankruptcy Code for One Year
------------------------------------------------------
Livemint.com reports that India will suspend fresh bankruptcy
proceedings against defaulters for one year so that companies are
not dragged into tribunals at a time they are trying to get back on
their feet, finance minister Nirmala Sitharaman said.
Livemint.com relates that the government will also make provisions
in the law to exclude all debt associated with the pandemic from
defaults covered under the Insolvency and Bankruptcy Code (IBC) for
triggering action against defaulters by creditors, the minister
said while announcing a raft of legislative measures to help
businesses tide over the crisis. The measures will be brought to
effect through an ordinance, Sitharaman said. Details of the
proposed amendments will be known once the ordinance and subsequent
notification of the proposals are issued.
According to the report, Sitharaman said the government will also
notify a special framework for dealing with the bankruptcy of
micro, small and medium enterprises. Also, the minimum payment
default threshold for triggering bankruptcy proceeding against a
company will be raised from INR1 lakh currently to INR1 crore, she
said.
"Many businesses have got severely affected, particularly during
the lockdown and the coronavirus pandemic. Debt related to covid-19
shall be excluded from the category of 'default' under IBC. No
fresh insolvency proceeding shall be initiated for up to one year,"
Sitharaman said while explaining the provisions in the proposed
ordinance.
While pausing fresh bankruptcy proceedings could be a breather for
many companies, it could deprive lenders the opportunity to
restructure certain companies which may be beyond redemption.
Experts said the uncertainty surrounding the economy warrants more
fundamental changes in the IBC than suspending it for a period.
"Bankruptcy laws have undergone fundamental changes during
uncertain times like these in the past. What we need is a
revolutionary rehash of the insolvency law and not a pause of the
bankruptcy proceedings for a year," the report quotes Sumant Batra,
managing partner of law firm Kesar Dass B. and Associates as
saying. "A new, out-of-the-box resolution approach is needed,
which incentivizes banks and public sector institutions to
proactively participate in rescuing businesses. The government
should take another leap of faith on IBC," he added.
=================
I N D O N E S I A
=================
GARUDA INDONESIA: Furloughs 800 Contract Workers to Stay Afloat
---------------------------------------------------------------
The Jakarta Post reports that Garuda Indonesia has decided to
furlough around 800 contract workers for three months starting May
14 as the airline struggles to stay afloat amid the COVID-19
pandemic.
According to the report, Garuda Indonesia president director Irfan
Setiaputra said the measure was a hard decision that needed to be
made to help ensure the airline's sustainability before it resumed
normal operations.
"We have made this decision after thorough consideration by taking
into account the employees and the company's interests and to avoid
layoffs," he said in a statement on May 17, adding that the
decision had been discussed between the employer and the affected
employees, The Jakarta Post relays.
During the three-month period, the furloughed employees will still
get their health insurance and Idul Fitri bonus, Irfan stated.
The Jakarta Post says the COVID-19 outbreak has forced Garuda to
park 100 of its 142 aircraft while its number of daily flights has
declined 70 percent compared to normal days as people stay at home
to avoid contracting and spreading the virus. In the first quarter
of 2020, the airline recorded a 31.9 percent annual drop in
passenger and cargo revenue.
Previously, Garuda Indonesia took several measures to maintain its
cash flow amid the plummeting demand for air travel caused by the
outbreak, the report says. The measures include cutting employees'
and executives' salaries, cutting production costs for efficiency
and renegotiating obligations to partners and aircraft lessors.
The Jakarta Post relates that the airline also opened discussions
with holders of its US$498.9 million in sukuk due on June 3 as the
company struggles to pay its dues.
Aviation observer Gerry Soejatman estimated recently that national
airlines would continue to reduce their capacity and services in
the next several months to avoid bankruptcy, especially as recovery
in passenger demand would take a long time.
"In the meantime, airlines need to be very careful in maintaining
their cash flow to survive until the passenger demand returns to
normal," the report quotes Mr. Soejatman as saying.
Headquartered in Jakarta, Indonesia, government-owned airline PT
Garuda Indonesia -- http://www.garuda-indonesia.com/-- currently
has a fleet of about 77 aircraft offering service to some 27
domestic and 33 international destinations. Under its Citilink
brand, it serves 10 other domestic routes. Garuda also ships about
200,000 tons of cargo a month and operates a computerized tracking
system.
=====================
N E W Z E A L A N D
=====================
CARTER HOLT: Proposes to Cut Workforce at Marsden Point in Half
---------------------------------------------------------------
NZ Herald reports that Carter Holt Harvey is proposing to cut the
staff at its Marsden Point plant in half as it grapples with
unprofitability.
The Herald understands that there are currently 325 staff working
at the plant and the company is proposing to restructure the
business and reduce staff numbers to 160.
This comes following the closure of the company's Whangarei mill in
February, where more than 110 jobs were axed, the Herald relates.
According to the report, Carter Holt Harvey confirmed that it had
begun consultation with staff in its laminated veneer lumber (LVL)
business to restructure it into a smaller domestically-focused
operation.
"The proposal reflects our serious concern that the export part of
the LVL business, which accounts for approximately 70 per cent of
our production and sales volume, is unprofitable and the business
as it operates today can't continue," the report quotes Prafull
Kesha, chief executive of Carter Holt Harvey, as saying in a
statement.
He said closure of the Marsden Point LVL plant remained an option.
"While total closure has been considered and still remains an
option, we have identified that a smaller domestically-focused
business may be more viable than the current business (which serves
both the export and domestic markets) with a better chance of long
run survival."
The restructure was not a direct result of Covid-19, the Herald
understands, though the pandemic had impacted the business.
Mr. Kesha said Carter Holt Harvey was working closely with the
union and affected staff, the Herald adds.
Auckland, New Zealand-based Carter Holt Harvey Limited is a
forestry and wood products company. The Company operates softwood
plantation forests, sawmills, and manufactures panel and engineered
wood products such as particleboard, medium density fiberboard,
plywood and laminated veneer lumber. Carter also processes logs,
chips and waste paper into softwood pulp, linerboard, and
cartonboard.
=================
S I N G A P O R E
=================
EZION HOLDINGS: Posts US$211.3MM Net Loss for Q1 Ended March 31
---------------------------------------------------------------
Annabeth Leow at The Business Times reports that Ezion Holdings has
posted the "significant net loss" that it warned about earlier this
week, as it swung much deeper into the red for the first quarter.
BT relates that the scheme of arrangement application for its
planned restructuring, which has been delayed since April by the
coronavirus pandemic and oil price crash, is also still in limbo.
Still, the management maintained that the group's going-concern
assumption is still appropriate, as it cited the support of its
lenders and positive operating cash flows that it said are expected
to be enough to cover debt obligations for the 12 months ahead, BT
says.
Losses widened to US$211.3 million for the three months to March
31, from US$12.9 million in the year before, BT discloses citing
unaudited financial statements released on May 15.
According to BT, revenue fell by 63.3 per cent year on year to
US$10.3 million, on the back of both an industry credit crunch and
a pandemic-driven slump in vessel utilisation. With cost of sales
outpacing the drop in revenue, Ezion was pushed into a gross loss
from a gross profit the year before.
But the bottom line was well and truly sunk by a massive impairment
loss of US$212.2 million on plant and equipment, trade and other
receivables and loan to joint ventures.
Loss per share was 5.66 US cents, against 0.35 US cent in the year
prior, while Ezion's net liabilities stood at 28.9 US cents a
share, compared with 23.27 US cents as at Dec. 31, 2019, BT
discloses.
No dividend was recommended, unchanged from the previous year, as
the board cited the group's net liabilities position, the report
notes.
Trading in Ezion shares was voluntarily suspended in March 2019,
when the chairman and chief executive asked in a letter for
shareholders' prayers.
Singapore-based Ezion Holdings Limited --
http://www.ezionholdings.com/-- engages in investment holding and
provision of management services. The Company, along with its
subsidiaries, specializes in the development, ownership and
chartering of offshore assets to support the offshore energy
markets. Its segments include Production and maintenance support,
which is engaged in owning, chartering and management of rigs and
vessels involved in the production and maintenance phase of the oil
and gas industry; Exploration and development support, which is
engaged in owning, chartering and management of rigs and vessels
involved in the exploration and development phase of the oil and
gas industry, and Others, which includes assets or investments
involved in renewable energy and other oil and gas related
industry. The Company owns a fleet of multipurpose self-propelled
service rigs. It owns a fleet of service rigs in Southeast Asia for
use in offshore oil and gas industry, and offshore wind farm
industry.
HATTEN LAND: Unit to Defend Against Contractor's MYR100MM Claim
---------------------------------------------------------------
Vivienne Tay at The Business Times reports that Hatten Land on May
14 said its wholly-owned subsidiary Gold Mart has received a claim
of MYR100 million (SGD32.8 million) from a contractor related to
the Malaysian property developer's Harbour City project.
Gold Mart had received a notice of adjudication dated May 13 from
lawyers representing the contractor - China Construction Yangtze
River (M) Sdn Bhd, BT says.
BT relates that the notice referred to a dispute over a
construction and completion contract dated July 15, 2016, for the
Harbour City project -- which has a total contract value of
MYR818.2 million.
In a regulatory update, Hatten Land said the contractor's claim is
without merit given the contractor is in substantive breach of the
agreement. The company added that Gold Mart intends to defend the
claim against it vigorously, the report relays.
Gold Mart also intends to counter-claim against the contractor for
an amount of at least MYR100 million for various breaches of
contract, BT says.
According to BT, both Hatten Land and Gold Mart are currently
taking legal advice on the contractor's claim and Gold Mart's
intended counter-claim.
The contractor and Gold Mart also need to reach an agreement on the
identity of the adjudicator within 10 working days from May 13.
If an agreement is not reached, the contractor will make a request
to the director of the Asian International Arbitration Centre to
appoint an adjudicator. The adjudicator will be in charge of
presiding, judging and arbitrating over the dispute, the report
notes.
Due to the urgency of time, Hatten Land said it is currently unable
to assess and disclose the financial impact of the proceeding for
the current financial year ending June 30, 2020.
The board's position on the company being able to continue
operating as a going concern remains unchanged, Hatten Land added,
BT relays.
Hatten Land Limited operates as a property developer. The Company
develops malls, hotels, and residential properties. Hatten Land
serves customers in Singapore and Malaysia.
*********
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.
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