/raid1/www/Hosts/bankrupt/TCRAP_Public/200603.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, June 3, 2020, Vol. 23, No. 111
Headlines
A U S T R A L I A
CARDIGAN COMMERCIAL: Second Creditors' Meeting Set for June 10
CRITERION CONFERENCES: Second Creditors' Meeting Set for June 9
LEAP LEGAL: Moody's Rates AUD50MM Sec. 1st Lien Term Loan B 'B1'
PAS GROUP: First Creditors' Meeting Set for June 11
PRIVATE DATA: Goes Into Voluntary Liquidation
SPF FUNDS: Second Creditors' Meeting Set for June 10
STELLER PROPERTY: Second Creditors' Meeting Set for June 10
TRITON BOND 2020: S&P Assigns Prelim B (sf) Rating to Cl. F Notes
VIRGIN AUSTRALIA: Bain and Cyrus Final Two in Race to Buy Carrier
C H I N A
CHINA MINSHENG: New Party Chief Chosen for Ailing Private Lender
HEJUN SHUNZE: Moody's Rates Proposed Notes 'B2'
SKYFAME REALTY: Fitch Affirms LT IDR at 'B-', Outlook Stable
[*] Over 40% Theaters Believe They Would Go Bankrupt This Year
I N D I A
AIR MOVEMENT: Insolvency Resolution Process Case Summary
AKSHAR SPINTEX: Ind-Ra Affirms 'BB+' Long Term Issuer Rating
ALFAPEOPLE IT SERVICES: Insolvency Resolution Process Case Summary
ATHANI SUGARS: Ind-Ra Hikes Issuer Rating to 'BB-', Outlook Stable
B S R BUILDERS: CARE Cuts Rating on INR26.30cr LT Loan to 'C'
BRIAR KNOLL: CARE Keeps D INR4.95cr Debt Rating in Not Cooperating
DATTA KRUPA: CARE Cuts INR25cr LT Loan Rating to D, Not Coop.
DHARTI DREDGING: CARE Keeps D Debt Ratings in Not Cooperating
DURGESHWARI INDUSTRIES: CARE Cuts Rating on INR15cr Loan to C
EBUSINESSWARE (INDIA): Insolvency Resolution Process Case Summary
GAYATRI SEA: CARE Cuts Rating on INR18.50cr Loan to 'D', Not Coop.
GEETANJALI GRAPHICS: Ind-Ra Lowers LongTerm Issuer Rating to 'D'
GMR WARORA: Ind-Ra Hikes Non-Convertible Debentures Rating to 'B'
INDIA INFOLINE: Moody's Cuts CFR & Sr. Sec. Debt Rating to B1
INDIA MEGA: CARE Keeps D INR25cr Debt Rating in Not Cooperating
INDIA POWER: Insolvency Resolution Process Case Summary
NEHA INTERNATIONAL: CARE Keeps 'D' Debt Ratings in Not Cooperating
ORBIT ELECTRO: Ind-Ra Cuts & Moves LT Issuer Rating to D, Not Coop.
POSHS METAL: Ind-Ra Assigns 'BB' LT Issuer Rating, Outlook Stable
PRABHU PETROCHEMICALS: CARE Assigns D Rating to INR13.14cr Loan
PRASAD EXTREME: CARE Lowers Rating on INR9.0cr Loan to 'D'
R. E. CABLES: CARE Maintains D Debt Ratings in Not Cooperating
RATTAN POLYCHEM: CARE Keeps 'D' Debt Ratings in Not Cooperating
REETHU TOBACCO: CARE Keeps D INR7.60cr Debt Rating in Not Coop.
RESURGENT POWER: CARE Keeps 'D' Debt Ratings in Not Cooperating
SAFIRE INDUSTRIES: CRISIL Keeps D Debt Ratings in Not Cooperating
SAFIRE OFFSET: CRISIL Keeps 'D' Debt Ratings in Not Cooperating
SAHYOG JANKALYAN: CRISIL Cuts Rating on INR4cr Loan to 'B+'
SARA SPINTEX: CARE Keeps 'D' Debt Ratings in Not Cooperating
SEVENHILLS HEALTHCARE: CRISIL Keeps 'D' Debt Ratings in Not Coop.
SHAKTI MURUGAN: CRISIL Lowers Rating on INR12cr Loan to 'B+'
SHIVNATH AUTOMOBILES: CRISIL Cuts Rating on INR10cr Loan to 'B+'
SHRIYA OVERSEAS: CARE Keeps 'D' Debt Ratings in Not Cooperating
SIDHI VINAYAK: CARE Keeps 'D' Debt Ratings in Not Cooperating
SNEHA VINYL: CRISIL Lowers Rating on INR8.5cr LT Loan to B+
SR FOILS: CRISIL Keeps 'D' Debt Ratings in Not Cooperating
SRI PRASANNA METALS: CRISIL Lowers Rating on INR7.5cr Loan to 'D'
SRI VIJAYA DURGA: CRISIL Keeps 'D' Debt Ratings in Not Cooperating
SUGAVANESWARA SPINNING: CRISIL Keeps D Debt Ratings in Not Coop.
SWASTIK LLOYDS: CRISIL Keeps 'D' Debt Ratings in Not Cooperating
THERMO PRODUCTS: CARE Keeps 'D' Debt Ratings in Not Cooperating
TMR DEVELOPERS: CRISIL Keeps D INR18cr Loan Rating in Not Coop.
UNNAT AGRO: CARE Lowers Rating on INR20.11cr LT Loan to B-
I N D O N E S I A
NISSAN MOTOR: Formally Closes Indonesian Factory
WASKITA BETON: Fitch Cuts LT Rating to 'BB(idn)', Outlook Neg.
M O N G O L I A
MONGOLIA: Fitch Affirms LT IDR at 'B', Outlook Stable
N E W Z E A L A N D
GRETHA GROUP: Ski Resort Placed Into Liquidation
S I N G A P O R E
CHINA CLUB: To Close, Files for Voluntary Liquidation
SMOVE SINGAPORE: Acres Advisory Appointed as Liquidators
- - - - -
=================
A U S T R A L I A
=================
CARDIGAN COMMERCIAL: Second Creditors' Meeting Set for June 10
--------------------------------------------------------------
A second meeting of creditors in the proceedings of Cardigan
Commercial Pty Ltd has been set for June 10, 2020, at 11:00 a.m.
via telephone conference 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 9, 2020, at 12:00 p.m.
Michael Carrafa and Fabian Kane Micheletto of SV Partners were
appointed as administrators of Cardigan Commercial on May 15, 2020.
CRITERION CONFERENCES: Second Creditors' Meeting Set for June 9
---------------------------------------------------------------
A second meeting of creditors in the proceedings of Criterion
Conferences Pty Ltd has been set for June 9, 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 June 8, 2020, at 5:00 p.m.
Alan Walker and Andre Lakomy of Cor Cordis were appointed as
administrators of Criterion Conferences on May 4, 2020.
LEAP LEGAL: Moody's Rates AUD50MM Sec. 1st Lien Term Loan B 'B1'
----------------------------------------------------------------
Moody's Investors Service has assigned a definitive B1 rating to
the AUD50 million guaranteed senior secured first lien term loan B
facility, and a definitive B3 rating to the AUD100 million
guaranteed senior secured second lien term loan B facility, entered
into by LEAP Legal Software Pty Limited. The ratings outlook is
stable. LEAP Legal Software Pty Limited is a wholly owned
subsidiary of Australia Technology Innovators Pty Limited.
Moody's definitive ratings are in line with the provisional ratings
assigned on November 26, 2018. The assignment of definitive ratings
follows Moody's review of the final debt documentation.
RATINGS RATIONALE
ATI's ratings continue to benefit from its market leading position
in legal practice management software, and strong product offering
in search and services platforms for professionals. The company
benefits from predictable revenue, underpinned by contractual
arrangements and high customer retention rates.
Moody's expects ATI's liquidity will be supported by good cash
flows preserved through cost cutting initiatives, including reduced
labor expenses and capital spending as well as the absence of
planned dividend distributions or acquisitions over the next 12-18
months.
Moody's also estimates that ATI's leverage -- as measured by
Moody's-adjusted debt to EBITDA -- will remain within the rating
tolerance threshold of 6.0x over the next 12 months under its base
case, which assumes property market volumes will gradually improve
from September 2020. However, there are high risks of more
challenging downside scenarios, as the severity and duration of
economic disruption arising from the coronavirus pandemic remains
uncertain.
Specifically, Moody's will continue to monitor the impact on the
Australian residential property market. ATI derives around 50%-55%
of net revenue from property transaction settlement volumes. Given
the company's relatively small scale, a significant reduction in
revenues of around 15%-20% would result in leverage exceeding the
rating tolerance threshold of 6.0x.
ENVIRONMENTAL, SOCIAL AND GOVERNANCE CONSIDERATIONS
The rating also takes into consideration environmental, social and
governance risks.
Moody's considers software/technology companies as exposed to
social risks through data protection/privacy risk and cyber
security risks.
In terms of governance, ATI's ownership is concentrated with
Christian Beck as the controlling shareholder. Moody's also
considers the recent shift in the company's financial policy as a
risk. This was evidenced by the recent debt-funded dividend
distribution, as well as the debt-funded purchase of a minority
stake in an affiliate overseas subsidiary also controlled by
Christian Beck, that did not contribute any earnings benefits in
the short term to ATI at the time. However, the company expects to
generate earnings of around AUD4 million from this subsidiary from
fiscal 2020.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS
Moody's could upgrade the ratings if ATI demonstrates a track
record of sustaining its adjusted debt-to-EBITDA ratio below 5.0x.
Moody's could downgrade the ratings if (1) property transaction
volumes decline such that ATI's adjusted debt-to-EBITDA exceeds
6.0x, (2) or if it continues to fund its acquisitions or dividend
payouts with debt, resulting in elevated financial leverage.
The principal methodology used in these ratings was Business and
Consumer Service Industry published in October 2016.
Australian Technology Innovators Pty Limited is a holding company.
It fully owns LEAP Legal Software Pty Limited (LEAP).
LEAP provides a cloud-based legal practice management platform to
small and medium-sized Australian legal and conveyancing firms.
InfoTrack Pty Limited is a premium cloud-based
Software-as-a-Service integrated search and services platform for
professionals.
PAS GROUP: First Creditors' Meeting Set for June 11
---------------------------------------------------
A first meeting of the creditors in the proceedings of:
- The PAS Group Limited
- PASCO Group Pty Ltd
- PAS Finance Pty Ltd
- JETS Swimwear Pty Limited
- AFG Retail Pty Limited
- Chestnut Apparel Pty Limited
- PASCO Operations Pty Ltd
- Black Pepper Brands Pty Limited
- Designworks Holdings Pty Limited
- Designworks Clothing Company Pty Limited
- World Brands Pty Ltd
- Yarra Trail Holdings Pty Limited
- Yarra Trail Pty Limited
- Review Australia Pty Limited
- The Capelle Group Pty Limited
- Fiorelli Licensing Pty Limited
- Metpas Pty Ltd
- The Hopkins Group Aust Pty Limited
- Bondi Bather Pty Limited
will be held on June 11, 2020, at 2:30 p.m. via a teleconferencing
facility.
Martin Ford, Stephen Longley and David McEvoy of PwC were appointed
as administrators of PAS Group et al. on May 29, 2020.
PRIVATE DATA: Goes Into Voluntary Liquidation
---------------------------------------------
Sasha Karen at ARN reports that Sydney-based Private Data Clouds
has gone into voluntary liquidation with more than AUD140,000 owed
to creditors.
ARN, citing liquidation documents, discloses that the company's
unsecured creditors include Telstra, 5G Networks and Digital
Pacific, who are all owed an unspecified amount.
According to ARN, liquidator Kathleen Vouris, partner at Hall
Chadwick, said Private Data Clouds is also embroiled in a legal
dispute with its largest debtor, company director Robyn Hutley.
"That dispute and those dealings has affected the business for some
time, and the company is not in a position to put further funds in
fighting that legal action," the report quotes Ms. Vouris as
saying.
Ms. Hutley, along with spouse Geoff Ferris, are also listed as
unsecured creditors, along with Arnott Technology Lawyers, who are
owed AUD75,000 and AUD8,000, respectively.
Ms. Vouris claimed the amount attributed to Ms. Hutley and Mr.
Ferris is related to the money that was put into the business and
wages.
In total, AUD147,000 is said to be owed to partly secured
creditors, ARN discloses citing Australian Securities and
Investments Commission documents.
The company isn't intending to sell up due to its small client
base, according to Ms. Vouris.
Private Data Clouds was set up in 2018 and claimed to offer a range
of services and products, including hosting services in Sydney and
Newcastle. It is also a registered partner with the Australian
Cyber Security Centre.
SPF FUNDS: Second Creditors' Meeting Set for June 10
----------------------------------------------------
A second meeting of creditors in the proceedings of SPF Funds
Management Pty Ltd has been set for June 10, 2020, at 10:00 a.m.
telephone conference 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 9, 2020, at 12:00 p.m.
Timothy James Brace, Michael Carrafa and Peter Gountzos of SV
Partners were appointed as administrators of SPF Funds on Sept. 20,
2019.
STELLER PROPERTY: Second Creditors' Meeting Set for June 10
-----------------------------------------------------------
A second meeting of creditors in the proceedings of Steller
Property Funds Pty Ltd has been set for June 10, 2020, at 11:00
a.m. via telephone conference 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 9, 2020, at 12:00 p.m.
Timothy James Brace, Michael Carrafa and Peter Gountzos of SV
Partners were appointed as administrators of Steller Property on
Sept. 20, 2019.
TRITON BOND 2020: S&P Assigns Prelim B (sf) Rating to Cl. F Notes
-----------------------------------------------------------------
S&P Global Ratings assigned its preliminary ratings to nine classes
of prime residential mortgage-backed securities (RMBS) to be issued
by Perpetual Corporate Trust Ltd. as trustee for Triton Bond Trust
2020 Series 2.
The preliminary ratings reflect:
-- S&P's view of the credit risk of the underlying collateral
portfolio, including the fact that this is a closed portfolio,
which means no further loans will be assigned to the trust after
the closing date.
-- S&P's view that the credit support is sufficient to withstand
the stresses we apply. This credit support comprises mortgage
insurance covering 23.7% of the loans in the portfolio, as well as
note subordination for all rated notes.
-- S&P's expectation that the various mechanisms to support
liquidity within the transaction, including an amortizing liquidity
facility equal to 1.2% of the invested amount of all notes subject
to a floor of 0.12%, principal draws, and a loss reserve that
builds from excess spread, are sufficient under our stress
assumptions to ensure timely payment of interest.
-- The extraordinary expense reserve of A$150,000, funded from day
one by Columbus Capital Pty Ltd., available to meet extraordinary
expenses. The reserve will be topped up via excess spread if
drawn.
-- The benefit of a fixed- to floating-rate interest-rate swap
provided by National Australia Bank Ltd. (NAB) to hedge the
mismatch between receipts from any fixed-rate mortgage loans and
the variable-rate RMBS, should any be entered into after
transaction close.
-- That loss of income for borrowers in the coming months due to
the effects of COVID-19 might put upward pressure on mortgage
arrears over the longer term. S&P recently updated its outlook
assumptions for Australian RMBS in response to changing
macroeconomic conditions as a result of the COVID-19 outbreak. The
collateral pool at close for this transaction will not include any
loans where the borrower has applied for a COVID-19 hardship
payment arrangement. Nevertheless, S&P undertook additional
cash-flow sensitivity analysis to assess the rated notes'
sensitivity to delays in borrower payments should some loans enter
hardship arrangements following the closing date.
S&P Global Ratings acknowledges a high degree of uncertainty about
the rate of spread and peak of the coronavirus outbreak. S&P said,
"Some government authorities estimate the pandemic will peak about
midyear, and we are using this assumption in assessing the economic
and credit implications. We believe the measures adopted to contain
COVID-19 have pushed the global economy into recession. As the
situation evolves, we will update our assumptions and estimates
accordingly."
PRELIMINARY RATINGS ASSIGNED
Triton Bond Trust 2020 Series 2
Class Rating Amount (mil. A$)
A1-AU AAA (sf) 225.00
A1-3Y AAA (sf) 200.00
A2 AAA (sf) 35.00
AB AAA (sf) 14.00
B AA (sf) 10.50
C A (sf) 7.00
D BBB (sf) 3.50
E BB (sf) 2.25
F B (sf) 1.50
G NR 1.25
NR--Not rated.
VIRGIN AUSTRALIA: Bain and Cyrus Final Two in Race to Buy Carrier
-----------------------------------------------------------------
Patrick Hatch and Sarah Danckert at The Sydney Morning Herald
report that the Richard Branson-linked investment fund Cyrus
Capital Partners and American buyout group Bain Capital will go
head to head in a final race to buy and relaunch Virgin Australia.
According to SMH, the collapsed airline's administrators Deloitte
announced a final bidder shortlist on June 2, with the surprise
exit of Melbourne-headquartered BGH Capital and its "Team
Australia" investment partner AustralianSuper.
SMH relates that Deloitte's lead administrator Vaughan Strawbridge
said Bain and Cyrus were both "well-funded", with "deep aviation
experience" and saw "real value in the business and its future".
They will hold further meetings with Virgin's management,
workforce, airline lessors and creditors ahead of making binding
offers for Virgin by June 12, SMH says. A second meeting of
creditors will be held in mid-August to vote on any proposed rescue
deal.
SMH notes that the New York-based Cyrus has a history of investing
in airlines alongside Virgin Group boss Richard Branson. They
launched Virgin America together in 2005 before Alaska Air bought
it for AUD2.6 billion in 2015, and Cyrus and Mr. Branson's 51 per
cent owned Virgin Atlantic last year bought British regional
airline Flybe, which has since gone into administration.
Mr. Branson co-founded Virgin Australia (then Virgin Blue) 20 years
ago and owned 10 per cent of the airline when it collapsed.
Canadian asset manager Brookfield was Virgin's union
representatives' preferred bidder, but Deloitte could not address
its concerns about the administration's tight time frame and the
airline's dwindling cash balance, the report relays.
According to SMH, Australian Council of Trade Unions president
Michele O'Neil said on May 29 that Cyrus and Bain each had
"chequered histories with regards to workers' rights", and that any
successful bid would have to protect as many jobs as possible,
protect entitlements and secure a viable future for Virgin.
Cyrus intends to maintain Virgin as a full-service international
airline, while Bain has said it will turn Virgin into a "hybrid"
carrier positioned somewhere between Qantas and Jetstar, the report
states. Bain is being advised on its bid by former Jetstar boss
Jayne Hrdlicka, who could emerge as an executive or director of the
relaunched Virgin.
SMH says BGH, led by former TPG boss Ben Gray and former Macquarie
Capital boss Robin Bishop, had been circling Virgin the longest and
discussed potential recapitalisation deals before it went into
administration in April. One source close to BGH said it was
surprised to be excluded.
Another source close to the sale said BGH's plan to restart Virgin
with as few as 15 planes before scaling up over time appears to
have worked against it, with Deloitte favoring bidders that would
get as many Virgin jets back in the sky as soon as possible.
Cyrus' inclusion in the final shortlist also caught some observers
by surprise, following reports on June 2 that it was considered the
least likely to go through, SMH adds.
About Virgin Australia
Brisbane, Queensland-based Virgin Australia is Australia's
second-largest airline. It commenced services in 2000 as Virgin
Blue, wholly owned by the Virgin Group.
As reported in the Troubled Company Reporter-Asia Pacific on April
22, 2020, Bloomberg News related that Virgin Australia Holdings
Ltd. became Asia's first airline to fall to the coronavirus after
the outbreak deprived the debt-burdened company of almost all
income. Administrators at Deloitte, who have taken control of the
Brisbane-based carrier, aim to restructure the business and find
new owners within months. More than 10 parties have expressed an
interest, Deloitte related on April 21.
According to Bloomberg, Virgin Australia, which has furloughed 80%
of its 10,000 workers, will continue to operate some flights for
essential workers, freight and the repatriation of Australians. The
airline's frequent flyer program is a separate company and is not
in administration.
Richard John Hughes, John Greig, Vaughan Strawbridge and Sal Algeri
of Deloitte were appointed as administrators of Virgin Australia,
et al., on April 20, 2020.
On April 29, 2020, the company and certain affiliates filed
petitions pursuant to Chapter 15 of the Bankruptcy Code in the U.S.
Bankruptcy Court for the Southern District of New York.
=========
C H I N A
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CHINA MINSHENG: New Party Chief Chosen for Ailing Private Lender
----------------------------------------------------------------
Wu Hongyuran and Isabelle Li at Caixin Global report that the
former chief executive of Bank of China's Hong Kong unit has been
appointed as the new Communist Party secretary of China Minsheng
Banking Corp. Ltd., one of the country's largest privately owned
banks.
Gao Yingxin, who resigned from Bank of China (Hong Kong) Ltd., will
take over for Zheng Wanchun, who remain at the bank as its deputy
party secretary, the bank announced on May 29, the report relays.
Caixin relates that the bank also said that Shao Yaping will
replace Chen Jinzhong as the head of its discipline inspection
commission and will join the bank's party committee.
The China Banking and Insurance Regulatory Commission (CBIRC) made
the personnel changes to meet Minsheng's needs for reform and
future growth, according to the bank. Gao has pledged to make
Minsheng a first-tier commercial bank.
Typically, Minsheng's party chief also serves as its top executive,
the report adds.
Minsheng, established in 1996, has a diverse ownership structure,
with private companies making up 10 of its largest shareholders.
Conflicts between the bank's shareholders and management have been
much fiercer than at many other banks, Caixin discloses citing
insiders.
According to Caixin, Minsheng's price-to-book ratio, which compares
a company's market value with its book value, currently sits at
around 0.53, which is below the average ratio of 0.6 to 0.7 for
other listed Chinese banks. It's also nowhere near rival China
Merchants Bank Co. Ltd.'s ratio of 1.5.
With its stock trading below book value, Minsheng has been
relegated to the second tier of China's joint-equity commercial
banks, Caixin notes.
Caixin says the new party leadership appointments came at a
challenging time for Minsheng, which has been criticized by its
shareholders for its underperforming stock. In addition,
management, shareholders and the banking regulator have clashed
over key candidates for its next board, the election of which had
to be postponed in February due to the Covid-19 pandemic, Caixin
has previously reported. It has yet to be rescheduled.
Current board members have disagreed with the CBIRC over who should
succeed Hong Qi as board chairman, several people close to
Minsheng's shareholders told Caixin. Hong, 62, has served as
chairman since 2014. His second term will end this year.
In 2019, Minsheng gave the CBIRC the names of two candidates to be
its next president, Caixin has learned. The regulator rejected
both. Instead, it recommended Gao, who joined Bank of China in 1986
after completing graduate school with an engineering degree.
Gao's appointment is still subject to shareholder and board
approval, Caixin notes. Based on past scheduling, the bank's next
shareholder meeting should take place in mid-June.
One longtime investor in Minsheng, speaking on condition of
anonymity, told Caixin that he supports the candidate recommended
by the regulator and hopes the new chief can put change at the
beleaguered bank.
About China Minsheng
Based in Beijing, China, China Minsheng Banking Corporation Ltd.'s
mainly provides commercial banking services that include absorbing
public deposits, providing short term, medium term, and long term
loans, making domestic and international settlement, discounting
bills and issuing financial bonds.
As reported in the Troubled Company Reporter-Asia Pacific on May 4,
2020, Fitch Ratings downgraded the Viability Rating on China
Minsheng Banking Corp., Ltd. to 'b', from 'b+'. At the same time,
Fitch has affirmed the Long-Term Foreign-Currency Issuer Default
Ratings of CMBC and four other Chinese mid-tier commercial banks at
'BB+', which are driven by sovereign support. The Outlooks are
Stable.
HEJUN SHUNZE: Moody's Rates Proposed Notes 'B2'
-----------------------------------------------
Moody's Investors Service has assigned a B2 senior unsecured rating
to the proposed notes to be issued by Hejun Shunze Investment Co.,
Limited, and unconditionally and irrevocably guaranteed by Sichuan
Languang Development Co., Ltd. (Languang Development, B1 stable).
Languang Development plans to use the proceeds from the proposed
notes to refinance its offshore existing debt.
The outlook is stable.
RATINGS RATIONALE
"The proposed bond issuance will improve Languang Development's
liquidity and not have a material impact on its credit profile,
because the proceeds will mainly be used to refinance the company's
maturing debt," says Celine Yang, a Moody's Assistant Vice
President and Analyst.
Languang Development's B1 corporate family rating reflects the
company's (1) history of developing mass market properties in the
Chengdu region, which includes Chengdu and surrounding cities; (2)
adequate liquidity; and (3) growing operating scale and increasing
geographic diversity since 2015.
On the other hand, the B1 rating is constrained by the company's
moderate credit metrics as it continues to fund its land
replenishment through debt financing, its still-developing funding
channels and sizable exposure to trust financing.
Moody's expects Languang Development's revenue to adjusted debt
will remain largely stable at 60%-65% over the next 12-18 months,
compared with 62% in 2019, as revenue growth from strong pre-sales
sales in the past two years will be mostly offset by debt growth to
replenish its land bank. Likewise, Moody's expects the company's
EBIT interest coverage will stay at 2.0x-2.5x over the next 12-18
months, compared with the 2.4x in 2019.
In terms of governance considerations, Moody's has taken into
consideration the company's concentrated ownership by its chairman
Yang Keng, who held an approximate 56.94% stake as of April 2020
and the pledging of 28.15% of the company's total outstanding
shares as of 20 May 2020.
Moody's has also considered (1) the fact that independent directors
chair the audit and remuneration committees; (2) the low level of
related-party transactions and dividend payouts; (3) the presence
of other internal governance structures and standards as required
by the Shanghai Stock Exchange; and (4) the company's financial
policy to pursue expansion, which has resulted in its elevated
leverage.
Moody's regards the impact of the deteriorating global economic
outlook amid the rapid and widening spread of the coronavirus
outbreak as a social risk under its environmental, social and
governance framework, given the substantial implications for public
health and safety.
Languang Development's liquidity is adequate. The company's cash
balance of RMB26.0 billion (including restricted cash of RMB1.6
billion) as of December 31, 2019, and its operating cash flow were
sufficient to cover its dividend payments and maturing debt
(including onshore puttable bonds) over the next 12-18 months.
The B2 senior unsecured debt rating is one notch lower than
Languang Development's B1 CFR due to structural subordination risk.
The subordination risk refers to the fact that the majority of
Languang Development's claims are at its operating subsidiaries and
have priority over claims at the holding company in a bankruptcy
scenario. In addition, the holding company lacks significant
mitigating factors for structural subordination. Consequently, the
expected recovery rate for claims at the holding company will be
lower.
The stable outlook reflects Moody's expectation that Languang
Development will maintain moderate sales growth, adequate liquidity
and stable credit metrics over the next 12-18 months.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATING
Moody's could upgrade Languang Development's ratings if (1) the
company demonstrates sustained growth in contracted sales and
revenue through the economic cycles without sacrificing
profitability; (2) it demonstrates prudence in its land acquisition
and financial management; (3) it continues to improve its funding
channels and maintains adequate liquidity; and (4) improves its
credit metrics, such that EBIT/interest rises above 3.0x and
revenue/adjusted debt rises to 75%-80% on a sustained basis.
On the other hand, Moody's could downgrade Languang Development if
(1) its contracted sales or cash collections weaken; (2) its
funding access or liquidity position deteriorate; or (3) leverage
increases substantially. Credit metrics indicative of a downgrade
include EBIT/interest coverage falling below 2.0x, or
revenue/adjusted debt falling below 50%-55% on a sustained basis.
The principal methodology used in this rating was Homebuilding And
Property Development Industry published in January 2018.
Sichuan Languang Development Co., Ltd. primarily develops
residential and commercial properties in China. The company was
founded in 1993 and listed on the Shanghai Stock Exchange in 2015
through a backdoor listing. The company had a total land bank of
24.5 million square meters in terms of gross floor area as of
December 31, 2019.
SKYFAME REALTY: Fitch Affirms LT IDR at 'B-', Outlook Stable
------------------------------------------------------------
Fitch Ratings has affirmed Skyfame Realty Limited's Long-Term
Foreign-Currency Issuer Default Rating at 'B-'. The Outlook is
Stable. The agency has also affirmed Skyfame's senior unsecured
rating of 'B-' with a Recovery Rating of 'RR4'.
The ratings reflect Fitch's expectation that the Chinese
homebuilder's leverage, while increasing due to the pursuit of
contracted sales growth and a small land bank, will remain below
65% in the next few years. The ratings also reflect Skyfame's small
scale, EBITDA margin that is in line with the industry average,
high churn rate and adequate liquidity with minimal refinancing
risk.
KEY RATING DRIVERS
Leverage to Rise: Skyfame's leverage, measured by net debt/adjusted
inventory, rose to 54% by end-2019 from 45% at end-2018. Fitch
expects leverage to increase to over 60%, but remain below its
negative trigger of 65%, in the next few years. Leverage will be
driven by land acquisitions as Skyfame has a short land bank life
of around three years and plans to significantly expand contracted
sales. However, Fitch believes the company is committed to keeping
its leverage below 65%, even if it means slower growth. Fitch
expects it to be able to do so while maintaining land bank life of
around three years.
Scale Remains Small: Skyfame's attributable contracted sales of
CNY8.3 billion in 2019 was one of the lowest among 'B-' rated
peers, which typically have sales of CNY10 billion-20 billion.
Fitch expects Skyfame's attributable contracted sales to rise to
CNY9.9 billion in 2020, despite flat total contracted sales, as it
will book lower sales from JV projects than in 2019. Around CNY5
billion of total contracted sales in 2019 came from two 40%-owned
and 51%-owned JV projects, while JV sales are expected to
contribute a much smaller amount of contracted sales in 2020.
Fitch believes continued growth will bring Skyfame's scale more in
line with 'B-' rated peers in the coming years. At end-2019,
Skyfame had 19 projects in 12 cities across several regions,
including the Greater Bay Area, Guangxi, Yunnan, Chongqing and
Jiangsu. Increasing business scale will also reduce geographical
and project concentration risk.
Minimal Refinancing Risk: Skyfame is in an adequate liquidity
position, with available cash to short-term debt ratio of 0.8x
(2018: 0.9x) at end-2019. Of the CNY1.9 billion in short-term debt,
CNY0.7 billion was bank loans that Fitch expects to be rolled over,
and CNY1.2 billion was project loans that Fitch expects to be
repaid with sales proceeds. In addition, refinancing risk is low
given limited capital market debt maturities (CNY12 million in 2020
and CNY355 million in 2021).
Sustainable Margin and Churn Rate: Skyfame's EBITDA margin,
excluding capitalised interest from cost of sales, fell to 25% in
2019 from 30% in 2018, as sales recognised in 2019 were mainly from
lower-margin projects in Tier 2 cities and there was limited
contribution from higher-margin redevelopment projects. Skyfame's
small number of projects makes its EBITDA margin more changeable
than that of larger peers.
Fitch forecasts its EBITDA margin, excluding capitalised interest
from cost of sales, to remain at around 27% in 2020-2023, based on
the company's ability to acquire low-cost land through various
channels (such as redevelopments, preferential auctions for
youth-entrepreneurship projects and M&As) and its target of at
least 25% EBITDA margin when investing in new projects. In
addition, Skyfame's churn rate (attributable contracted sales/total
debt) of 1.3x in 2019 is the highest among 'B-' rated peers and
Fitch expects it to remain high as contracted sales grow.
DERIVATION SUMMARY
Skyfame's ratings are mainly constrained by its small scale and
high leverage relative to that of 'B-' rated peers.
Skyfame has the lowest attributable contracted sales of CNY8
billion among 'B-' rated peers - Xinyuan Real Estate Co., Ltd.
(B-/Stable) has attributable contracted sales of CNY14 billion,
Xinhu Zhongbao Co., Ltd. (B-/Stable) CNY16 billion and Guorui
Properties Limited (B-/Negative) CNY11 billion. The exception is
Golden Wheel Tiandi Holdings Company Limited (B-/Stable), which has
attributable contracted sales of CNY3 billion, but whose rating are
supported by significant non-property development income.
Skyfame's is also the least diversified by geography and projects,
with 19 projects across 12 cities. In comparison, Xinyuan has
projects in 15 cities, Xinhu Zhongbao has 30 projects across 20
cities, and Guorui has presence in 21 cities. However, unlike
Guorui, Skyfame has adequate liquidity and its refinancing risk is
minimal as it has an available cash to short-term debt ratio of
0.8x and limited near-term maturities of capital market debt.
Fitch expects Skyfame's leverage to increase to over 60% in the
next few years, which will be higher than Xinyuan's 50%-55%,
Guorui's 50%-55% and Golden Wheel's 50%. It will be comparable to
Xinhu Zhongbao's fair-value adjusted leverage of 60%-65%. Skyfame's
EBITDA margin, excluding capitalised interest, of 25%-30% is
similar to Xinyuan's 25%, but lower than Guorui's 30%, Xinhu
Zhongbao's 30%-35% and Golden Wheel's 30%-35%. Skyfame has the
highest churn rate among 'B-' rated peers at 1.3x.
KEY ASSUMPTIONS
Fitch's Key Assumptions Within its Rating Case for the Issuer
- Attributable contracted sales of CNY9.9 billion in 2020 and
CNY12.4 billion in 2021 (2019: CNY8.3 billion)
- EBITDA margin (excluding capitalised interest) of 27% in 2020
and 2021 (2019: 25%)
- Cash collection rate of 75% for current year sales in 2020 and
2021 (2019: 74%)
- Land purchase cost at 54% and 33% of sales proceeds in 2020 and
2021, respectively, to maintain a land bank life of around three
years
- Construction costs at 44% and 36% of sales proceeds in 2020 and
2021, respectively
RATING SENSITIVITIES
Factors That Could, Individually or Collectively, Lead to Positive
Rating Action/Upgrade:
- No positive rating action is expected in the next 24 months,
unless Skyfame's business profile improves significantly
Factors That Could, Individually or Collectively, Lead to Negative
Rating Action/Downgrade:
- Decrease in attributable contracted sales
- Leverage, measured by net debt/adjusted inventory, sustained at
above 65%
- EBITDA margin, excluding capitalised interest, sustained at
below 20%
- Deterioration of liquidity position
BEST/WORST CASE RATING SCENARIO
International scale credit ratings of Non-Financial Corporate
issuers have a best-case rating upgrade scenario (defined as the
99th percentile of rating transitions, measured in a positive
direction) of three notches over a three-year rating horizon; and a
worst-case rating downgrade scenario (defined as the 99th
percentile of rating transitions, measured in a negative direction)
of four notches over three years. The complete span of best- and
worst-case scenario credit ratings for all rating categories ranges
from 'AAA' to 'D'. Best- and worst-case scenario credit ratings are
based on historical performance.
LIQUIDITY AND DEBT STRUCTURE
Adequate Liquidity: Skyfame had adequate liquidity, with available
cash to short-term debt ratio of 0.8x at end-2019 (end-2018: 0.9x).
Of the CNY1.9 billion short-term debt, CNY0.7 billion was bank
loans, which Fitch expects to be rolled over. The remaining CNY1.2
billion was mainly the outstanding amount of a project loan for a
Chongqing project. The repayment schedule of the project loan has
been revised to CNY650 million due in 2020 and the rest due in
2021. As of April 2020, CNY390 million has been settled with the
remaining CNY260 million expected to be settled with sales proceeds
in the second half of the year. Capital market debt due in 2020 is
immaterial (CNY12 million). In addition, Skyfame only has a small
amount of bank borrowings due (around CNY200 million) and unsecured
bonds maturing (around CNY355 million) due in 2021.
REFERENCES FOR SUBSTANTIALLY MATERIAL SOURCE CITED AS KEY DRIVER OF
RATING
The principal sources of information used in the analysis are
described in the Applicable Criteria.
ESG CONSIDERATIONS
The highest level of ESG credit relevance, if present, is a score
of 3. This means ESG issues are credit-neutral or have only a
minimal credit impact on the entity(ies), either due to their
nature or to the way in which they are being managed by the
entity(ies).
[*] Over 40% Theaters Believe They Would Go Bankrupt This Year
--------------------------------------------------------------
ChinaFilmInsider, citing a recent market research conducted by
Chinese Film Distribution Association, reports that a staggering
40% of the interviewed theaters believe that they would have to
permanently close their businesses this year.
Until the end of March, 20% theaters in China have laid off
employees, and 12% theaters have downgraded their pay rate, but
there are also 68% theaters have vowed not to lay off any
employees, the report relates.
Among these affected theaters, small-sized theaters were hit the
hardest, the report says.
=========
I N D I A
=========
AIR MOVEMENT: Insolvency Resolution Process Case Summary
--------------------------------------------------------
Debtor: Air Movement & Control System Private Limited
Registered office as per MCA Data:
D-1027, Gali No. 11
Ashok Nagar, Shahdara
Delhi DL 110093
IN
Insolvency Commencement Date: February 28, 2020
Court: National Company Law Tribunal, New Delhi Bench
Estimated date of closure of
insolvency resolution process: August 26, 2020
(180 days from commencement)
Insolvency professional: Pankaj Narang
Interim Resolution
Professional: Pankaj Narang
304, Tower Apartment
Swasthya Vihar
New Delhi
NCT of Delhi 110092
E-mail: pankajnarangca@gmail.com
cirp.amc@gmail.com
Last date for
submission of claims: May 29, 2020
AKSHAR SPINTEX: Ind-Ra Affirms 'BB+' Long Term Issuer Rating
------------------------------------------------------------
India Ratings and Research (Ind-Ra) has affirmed Akshar Spintex
Limited (ASL) Long-Term Issuer Rating at 'IND BB+ (ISSUER NOT
COOPERATING)'. The issuer did not participate in the rating
exercise despite continuous requests and follow-ups by the agency.
Therefore, investors and other users are advised to take
appropriate caution while using these ratings. The rating will
continue to appear as 'IND BB+ (ISSUER NOT COOPERATING)' on the
agency's website.
The instrument-wise rating actions are:
-- INR242.7 mil. Term loan due on August 2022 affirmed with IND
BB+ (ISSUER NOT COOPERATING) rating;
-- INR60.0 mil. Fund-based working capital limit affirmed with
IND BB+ (ISSUER NOT COOPERATING) rating; and
-- INR13.5 mil. Non-fund-based working capital limit affirmed
with IND A4+ (ISSUER NOT COOPERATING) rating.
Note: ISSUER NOT COOPERATING: Issuer did not cooperate; based on
the best-available information. Ind-Ra is unable to provide an
update, as the agency does not have adequate information to review
the ratings.
KEY RATING DRIVERS
The affirmation reflects ASL's continued moderate scale of
operations, as reflected by revenue of INR1,006.32 million in FY19
(FY18: INR930.76 million).
The rating factor in ASL's moderate credit metrics. The gross
interest coverage (operating EBITDA/gross interest expense)
deteriorated to 4.10x in FY19 (FY18: 6.04x) and net leverage (total
adjusted net debt/operating EBITDAR) to 2.48x (2.07x).
The ratings further factor in ASL's strong profitability margin,
which contracted to 10.07% in FY19 (FY18: 15.29%).
The ratings have been maintained in the non-cooperating category as
the company did not provide Ind-Ra with revised projections data,
latest banker details, updated management certificate, and working
capital utilization in a timely manner.
COMPANY PROFILE
ASL was incorporated in September 2013 as a private limited
company. On January 5, 2018, the company changed its constitution
to a public limited company. The company is engaged in the business
of cotton yarns and is listed on the Bombay Stock Exchange.
ALFAPEOPLE IT SERVICES: Insolvency Resolution Process Case Summary
------------------------------------------------------------------
Debtor: M/s. Alfapeople IT Services Pvt. Ltd.
C/o Regus, No. 26/1, 2nd Floor
IBIS Hotel, Hosur Road
Bommanahalli
Bangalore 560068
Insolvency Commencement Date: February 5, 2020
Court: National Company Law Tribunal, Bengaluru Bench
Estimated date of closure of
insolvency resolution process: August 3, 2020
Insolvency professional: Surender Devasani
Interim Resolution
Professional: Surender Devasani
1436, Anasuya Nilaya
2nd Floor, 8th Cross
10th Main, BTM 2nd Stage
Bengaluru 560076
E-mail: surenderdevasani@gmail.com
Mobile: 9972635711
- and -
#50, Ground Floor
Millennium Towers
Queens Road
Bengaluru 560051
Last date for
submission of claims: June 5, 2020
ATHANI SUGARS: Ind-Ra Hikes Issuer Rating to 'BB-', Outlook Stable
------------------------------------------------------------------
India Rating and Research (Ind-Ra) has upgraded Athani Sugars
Limited's (ASL) Long-Term Issuer Rating to 'IND BB-' from 'IND B+'.
The Outlook is Stable.
The instrument-wise rating actions are:
-- INR827 mil. (reduced from 857.5 mil.) Term loan due on
September 2026 upgraded with IND BB-/Stable rating;
-- INR2.650 bil. (reduced from INR4.25 bil.) Fund-based working
capital facilities upgraded with IND BB-/Stable/IND A4+
rating; and
-- INR500 mil. (reduced from INR567.5 mil.) Short-term loans
upgraded with IND BB-/Stable/IND A4+ rating.
The upgrade reflects an improvement in ASL's stretched liquidity in
FY20.
KEY RATING DRIVERS
Liquidity Indicator- Stretched, but Improved: ASL's cash flow from
operations turned positive to INR1,548 million in FY20 (FY19:
negative INR1,093 million) due to an improvement in its cash
conversion cycle. Its average use of fund-based limits was 60% over
the 12 months ended April 2020. At FYE19, ASL had a cash balance of
INR47 million and a restricted cash balance of INR93 million. The
company incurred capex of INR2,450 million during FY16-FY18 for
distillery and co-generation plant expansion funded 60% from debt
and 40% from internal accruals. The company repaid the term loan of
INR152 million due in March 2020 and has an obligation of INR569
million repayable in FY21. ASL has not availed of the moratorium
under the COVID-19 regulatory package scheme offered by the Reserve
Bank of India. The company has a high working capital requirement
owing to a higher inventory period. Its working capital cycle
improved to 157 days in FY19 (FY18: 295 days) due to decrease in
inventory days to 224 days (375 days).
The ratings are constrained by ASL's weak credit metrics. The
company's interest coverage (EBITDA/gross interest expense)
improved slightly to 1.3x in FY19 (FY18: 1.2x) due to decrease in
interest expenses to INR529 million (INR721 million). A further
improvement in the coverage was arrested by decrease in the
absolute EBITDA to INR667 million in FY19 (FY18: INR900 million)
due to an increase in the raw material price. Its net leverage
(adjusted net debt/operating EBITDA) deteriorated to 13.5x in FY19
(FY18: 11.4x) despite the fall in debt to INR10,067 million
(INR11,147 million) due to a higher fall in absolute EBITDA.
The ratings also factor in ASL's modest margin, which contracted to
6.8% in FY19 (FY18: 10.9%) due to an increase in the raw material
cost. In 9MFY20, the company recorded an EBITDA margin of 9.7%, and
the management estimates it to have improved in FY20 due to the
revised minimum selling price (MSP) of INR31 per kg (February 2019:
INR29 per kg) and also as the company completed its first full year
of operation of its distillery plant. The margins of sugar players
are vulnerable to various factors such as changes in MSP and fair
and remuneration price, according to the government norms. ASL's
return on capital employed was modest at 4% in FY19 (FY18: 6%).
The ratings, however, are supported by the increase in the
company's revenue to INR9,835 million in FY19 (FY18: INR8,268
million) due to the increase in the MSP. The revenue growth was
also aided by an increase in the revenue from power and distillery
division due to an increase in the power capacity to 52MW (FY18:
28MW) and distillery capacity to 180 kilo litre per day (klpd;
90klpd) in FY19. The government introduced the MSP plan and quota
for selling sugar from June 2018. Due to the quota for sugar, the
sugar sale volumes deteriorated slightly and the average price of
the sugar increased in FY19.
The ratings are also supported by the promoters about 22 years of
experience in the sugar industry, leading to established
relationships with suppliers (farmers). The company has diversified
its operations by setting up a co-generation and distillery unit in
Maharashtra other than its unit in Karnataka.
RATING SENSITIVITIES
Positive: Any substantial improvement in the EBITDA margin and
liquidity position, while maintaining the revenue, leading to an
improvement in the interest coverage rising above 1.5x could lead
to positive rating action.
Negative: Any substantial stretch in the liquidity position, and/or
decline in the revenue or EBITDA resulting in interest coverage
reducing below 1.25x on a sustained basis could lead to negative
rating action.
COMPANY PROFILE
Incorporated in 1995, ASL has an integrated sugar plant, with an
18,000 tons per day cane crushing capacity, a 52MW co-generation
unit with power generation capacity, and a 180 klpd distillery
unit.
B S R BUILDERS: CARE Cuts Rating on INR26.30cr LT Loan to 'C'
-------------------------------------------------------------
CARE Ratings revised the ratings on certain bank facilities of B S
R Builders Engineers & Contractors (BSREC), as:
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long–term Bank 26.30 CARE C; Stable; Issuer not
Facilities cooperating; Revised from
CARE B+; Stable; ISSUER
NOT COOPERATING on the basis
of best available information
Detailed Rationale & Key Rating Drivers
CARE had, vide its press release dated March 18, 2019, placed the
rating(s) of BSREC under the 'Issuer non-cooperating' category as
BSREC had failed to provide information for monitoring of the
rating. BSREC continues to be non-cooperative despite repeated
requests for submission of information through e-mails, phone calls
and email dated April 20, 2020 to April 24, 2020. In line with the
extant SEBI guidelines, CARE has reviewed the rating on the basis
of the best available information which however, in CARE's opinion
is not sufficient to arrive at a fair rating.
Users of this rating (including investors, lenders and the public
at large) are hence requested to exercise caution while
using the above rating.
The revision in the rating takes into account the non-availability
of adequate information due to non- cooperation by BSREC with
CARE's efforts to undertake a review of the outstanding ratings as
CARE views information availability risk as key factor in its
assessment of credit risk profile.
Detailed description of the key rating drivers
At the time of last rating on March 18, 2019 the following were the
rating strengths and weaknesses:
Key Rating Weakness
* Small scale of operations: Although having accomplished various
projects and a track record of 15 years, the firm's scale of
operations marked by the total operating income remained small at
INR0.60 crore in FY17 coupled with a low net worth base of INR13.65
crore as on March 31, 2017 as compared to other peers in the
industry. The small scale of operation could restrict the firm's
financial flexibility and deprive it of scale benefits.
* Partnership nature of constitution with inherent risk of capital
withdrawal: The partners typically make all the decisions and lead
the business operations. If they become ill or disabled, there may
not be anybody else to step in and maintain the optimum functioning
of business. A business run by nine partners also poses a risk of
heavy burden, i.e. an inherent risk of capital withdrawal, at a
time of personal contingency which can adversely affect the capital
structure of the firm. Moreover, the partnership firms have
restricted access to external borrowing which limits their growth
opportunities to some extent. In FY16, capital to a tune of INR0.42
crore was withdrawn from the firm.
* Geographically concentrated revenue profile: BSRBEC entirely
derives its revenue from orders executed in the state of Tamil
Nadu, particularly from Chennai, which exposes the firm to
geographical concentration risk.
* Fragmented nature of the real estate sector albeit improving
growth prospects: The real estate sector in India is highly
fragmented with a large number of small and mid-sized players.
* Certain factors such: as project execution challenges, delays in
land acquisition, regulatory clearances, long working capital
cycles as a result of longer gestation periods collectively place
pressure on the firm's credit profile. Despite these impediments,
increasing growth in residential properties due to lower interest
rates, easy availability of housing finance and various government
initiatives in real estate sector are expected to revive the
industry in medium to long term.
Key Rating Strengths
* Experience of the partners in real estate business: BSRBEC is
promoted by Mr. Raghavendra Reddy (Managing Partner) and with other
family members. Mr. Raghavendra has 30 years of experience in
construction line of business. Due to long presence in the market
has helped him in establishing good relationships with customers.
* Financial closure for the projects are achieved: For both the
projects, the financial closure has been achieved by the firm. For
"BSR Mall", project is proposed to be funded by promoter's capital
(37.50%), sanctioned term loan (25%) and advances from customers
and sales (37.50%). As on August 26th February 2018, the firm has
incurred a total cost of 82.92%. For "Balaji Enclave", project is
proposed to be funded by promoter's capital (28.67%), sanctioned
term loan (23.89%) and advances from customers and sales (47.43%).
As on February 26st 2018, the firm has incurred a total cost of
70.84%.
Chennai (Tamil Nadu) based, B.S.R. Builders Engineers & Contractors
(BSRBEC) was established in the year 2004 as a partnership firm by
Mr. Raghavendra Reddy and his family members. The firm is engaged
in the construction of residential townships, apartments, shopping
malls and commercial complexes.
BRIAR KNOLL: CARE Keeps D INR4.95cr Debt Rating in Not Cooperating
------------------------------------------------------------------
CARE Ratings said the rating for the bank facilities of Briar Knoll
Mills Private Limited (BKM) continues to remain in the 'Issuer Not
Cooperating' category.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long-term Bank 4.95 CARE D; Issuer not cooperating;
Facilities Based on the best available
Information
Detailed Rationale & Key Rating Drivers
CARE had, vide its press release dated February 18, 2019 placed the
rating of BKM under the 'issuer non-cooperating' category as BKM
had failed to provide information for monitoring of the rating. BKM
continues to be non-cooperative despite repeated requests for
submission of information through e-mails, phone calls and a letter
dated April 7, 2020. In line with the extant SEBI guidelines, CARE
has reviewed the rating on the basis of the best available
information which however, in CARE's opinion is not sufficient to
arrive at a fair rating.
Users of this rating (including investors, lenders and the public
at large) are hence requested to exercise caution while using the
above rating.
Detailed description of the key rating drivers
At the time of last rating on February 18, 2019 the following were
the rating strengths and weaknesses (updated for the information
available from Insolvency and Bankruptcy Board of India).
Key Rating Weaknesses
NPA Classification from Bank: CARE is in receipt in a communication
from the bank that the account has been classified as
Non-performing asset.
* Corporate Insolvency resolution process: The Company had
defaulted in payment to its creditor and is under Corporate
Insolvency Resolution Process (CIRP) via order dated February 25,
2019.
* Small scale of operations: BKM commenced its operations during
November 2014 and the scale of operations of the company remained
small with a total income of Rs.30.49 crore and PBILDT of Rs. 4.53
crore during FY17.
Key Rating Strengths
* Promoter's experience in the textile business: BMK is a 100%
subsidiary of Briar Knoll Textile Private Limited (BKT). The
Company is managed by a team of professionals with vast experience
in their functional areas of Production, Marketing and Finance.
Briar Knoll Mills Private Limited (BKM) was incorporated in August
1, 2012 and started commercial operations in November 2014. BKM is
engaged in manufacturing and sale of fine linen fabrics for home
décor both domestic and internationally which is used as input to
produce Bed Sheets, Duvets, Curtains and Upholsteries. As on
November 30, 2017, BKM had 24 Rapier looms with installed capacity
to produce 12.8 lakh metres of fabrics per annum.
DATTA KRUPA: CARE Cuts INR25cr LT Loan Rating to D, Not Coop.
-------------------------------------------------------------
CARE Ratings revised the ratings on certain bank facilities of
Datta Krupa Roller Flour Mill Private Limited (DRFM), as:
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long-term Bank 25.00 CARE D; Issuer not cooperating;
Facilities Revised from CARE C; on the
basis of best available
information
Detailed Rationale & Key Rating Drivers
CARE had, vide its press release dated September 6, 2018, January
8, 2019, placed the rating of DRFM under the 'issuer
non-cooperating' category as DRFM had failed to provide information
for monitoring of the rating. DRFM continues to be non-cooperative
despite repeated requests for submission of information through
e-mails, phone calls and a email dated May 14, 2020. In line with
the extant SEBI guidelines, CARE has reviewed the rating on the
basis of the best available information which however, in CARE's
opinion is not sufficient to arrive at a fair rating.
Users of this rating (including investors, lenders and the public
at large) are hence requested to exercise caution while using the
above rating.
The ratings have been revised on account of classification of
account as non-performing asset by the lender as confirmed by them.
This was on account of delays in debt servicing.
Detailed description of the key rating drivers
Key Rating Weaknesses
* Delays in debt servicing: The lender has confirmed that the
company has been classified as NPA by them due to delays in debt
servicing.
Analytical approach: Combined.
For arriving at the rating, CARE has combined the business and
financial risk profiles of India Mega Agro - Anaj Limited (IMA –
rated CARE D, Issuer Not Cooperating) and DRFM hereinafter referred
as Dattakrupa Group (DKG). Both companies are under common
management with similar nature of operations and product portfolio.
Moreover the combined approach is also based on common shareholders
and undertaking from the promoter-director ensuring financial
fungibility between the companies whenever required.
Incorporated in 2005, Dattakrupa Roller Flour Mill Private Limited
(DRFM - part of Dattakrupa group) manufactures wheat products such
as atta, maida, suji, rawa and dal mills. The company's
manufacturing facility is located at Parbhani, Maharashtra. Its
roller flour mill has a processing capacity of 250 tonnes per day
and its dal mill has a processing capacity of 50 tonnes per day.
Later Dattakrupa group in 2010 expanded its operations in agro
processing industry with incorporation of India Mega Agro - Anaj
Limited (IMA) located at Nanded, Maharashtra. IMA is engaged in the
business of multiple food processing like roller flour mill; cattle
& poultry unit; dal & rice mill; oil mill & refinery; solvent unit
and biscuit unit.
DHARTI DREDGING: CARE Keeps D Debt Ratings in Not Cooperating
-------------------------------------------------------------
CARE Ratings said the rating for the bank facilities of Dharti
Dredging and Infrastructure Ltd. (DDIL) continues to remain in the
'Issuer Not Cooperating' category.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long-term Bank 79.96 CARE D; Issuer not cooperating;
Facilities Based on the best available
Information
Long-term/Short- 208.00 CARE D; Issuer not cooperating;
Term bank Based on the best available
facilities Information
Detailed Rationale& Key Rating Drivers
CARE had, vide its press release dated Jan 18, 2019, placed the
rating of DDIL under the 'issuer non-cooperating' category as DDIL
had failed to provide information for monitoring of the rating.
DDIL continues to be non-cooperative despite repeated requests for
submission of information through e-mails, phone calls and a email
dated May 7, 2020. In line with the extant SEBI guidelines, CARE
has reviewed the rating on the basis of the best available
information which however, in CARE's opinion is not sufficient to
arrive at a fair rating.
Users of these ratings (including investors, lenders and the public
at large) are hence requested to exercise caution while using the
above rating.
Detailed description of the key rating drivers
At the time of last rating on January 18, 2019 the following were
the rating strengths and weaknesses (updated for the information
available from Registrar of Companies:
Key Rating Weaknesses
* Stretched liquidity position with delay in debt servicing: DDIL
had been experiencing stretched collection period in the last three
years led by significant delay in receipt of payments from its
clients. The average collection period has elongated to 365 days
during FY18. Consequently, due to the inability of the company to
realize its receivables in a timely manner, there have been delays
in servicing the debt obligations.
* Net loss reported during FY18: Total operating income of the
company reported a marginal y-o-y decline of around 4.3% to
INR238.47 crore during FY18 compared to INR249.25 crore during
FY17. Also, company has reported net loss of INR2.10 crore during
FY18 compared to net profit of INR4.29 crore during FY17.
Key Rating Strengths
* Experienced promoter with long track record: The promoter; Mr. A.
Rajendra (Chairman and Managing Director) has long standing
experience of 20 years in the industry and looks after day to day
activities of the company. Under his leadership, the company has,
over the years, diversified into trenching and back-filling works
for the oil and gas industry for domestic as well as international
clients.
Incorporated in 1993, Dharti Dredging and Infrastructure Ltd (DDIL)
is a Hyderabad-based company engaged in the work of dredging,
mainly capital dredging. In addition to dredging activities, the
company also undertakes trenching and back filling works related to
offshore pipeline installation, road embankment projects,
de-weeding of lakes, land reclamation etc. DDIL has executed
dredging projects in India, the Middle East, Myanmar and Indonesia.
DDIL commenced its operations with one dredging unit at Paradeep
Fishing Harbor in 1993. Over the years, it has executed various
dredging projects and post amalgamation with MDPL (Marine Dredging
Pvt. Ltd) DDIL owns a fleet of 16 dredgers (mostly cutter suction
dredgers).
DURGESHWARI INDUSTRIES: CARE Cuts Rating on INR15cr Loan to C
-------------------------------------------------------------
CARE Ratings said the rating for the bank facilities of Durgeshwari
Industries Limited (DIL) continues to remain in the 'Issuer Not
Cooperating' category.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long term Bank 15.00 CARE C; Issuer Not Cooperating;
Facilities Revised from CARE B+; Stable
On the basis of best available
Information
Detailed Rationale & Key Rating Drivers
CARE had, vide its press release dated January 15, 2019, placed the
rating of DIL under the 'issuer non-cooperating' category as DIL
had failed to provide information for monitoring of the rating as
agreed to in its Rating Agreement. DIL continues to be
non-cooperative despite repeated requests for submission of
information through phone calls and e-mails dated April 16, 2020
and April 27, 2020. In line with the extant SEBI guidelines, CARE
has reviewed the rating on the basis of the best available
information which however, in CARE's opinion is not sufficient to
arrive at a fair rating.
Users of this rating (including investors, lenders and the public
at large) are hence requested to exercise caution while using the
above rating.
The ratings have been revised on account of no due diligence
conducted and non-availability of complete information due to
non-cooperation by DIL with CARE's efforts to undertake a review of
the rating outstanding. CARE views information availability risk as
a key factor in its assessment of credit risk. Further, the
revision in the rating takes into account the consistent decline in
total operating income during the past three years ended in FY19
(Audited: Period from April 01, 2018 to March 31, 2019), along with
deterioration in capital structure on account of erosion of
net-worth base due to losses registered for FY18 and FY19 and
stretch in liquidity position. The ratings further continues to
remain constrained on account of small scale of operations,
leveraged capital structure and weak debt coverage indicators,
susceptibility of margins to fluctuation in raw material prices and
its presence in highly fragmented and competitive industry. The
ratings however, are underpinned by the extensive experience of the
promoters with long track record of operations of company of more
than two decades and diversified customer base.
Detailed description of the key rating drivers
At the time of last rating on January 15, 2019 the following were
the rating strengths and weaknesses (updated for the information
available from Ministry of Corporate Affairs)
Key Rating Weaknesses
* Weak financial risk profile of the company marked by decline in
scale of operations, profitability margins and weak solvency
position: The scale of operations of DIL marked by total operating
income (TOI) has consistently declined in FY17-FY19 and stood small
at INR10.13 crore for FY19. Further, the company has registered
operating and net loss for FY19, leading to erosion of networth in
FY19. The small scale of operations along with eroded net worth
base of the company restricts its financial flexibility in times of
stress and deprives it from scale benefits. The debt coverage
indicators also remained weak as at the end of FY19.
* Stretched liquidity position: The operations of the company is
characterized by high gross current asset of 602 days as the end of
FY19 with funds mainly blocked in inventory.
* Presence in highly fragmented industry with limited value
addition: DIL is engaged in the ginning and pressing of cotton,
along with the oil extraction, which involves very limited value
addition and hence results in thin profitability margins. Moreover,
on account of large number of units operating in cotton ginning
business in Maharashtra, the competition within the players remains
very high resulting in high fragmentation and further restricts the
profitability. Thus, ginning players have
very low bargaining power against its customer as well as
suppliers.
* Operating margins susceptible to cotton price fluctuation and
seasonality that is associated with cotton industry: Raw Cotton, a
seasonal agricultural commodity (from November to February), is the
key raw material, and accounts for 65 to 68 per cent of yarn
spinners' operating costs. The global scenario for cotton, in terms
of output, demand-supply, and exports/imports, can impact domestic
prices. Interdependency across the value chain exists; hence, the
ability to pass on any increase in cost and thus maintain healthy
margins remains a key driver for players. Further, besides seasonal
availability of raw cotton the prices of raw cotton are also
dependent upon factors like, rainfall, area under production, yield
for the year, international demand supply scenario, export quota
decided by government and inventory carry forward from the previous
year. Ginners usually have to procure raw materials at
significantly higher volume to bargain bulk discount from
suppliers.
Key Rating Strengths
* Established track record of operations of entity along with
experienced promoters: Parbhani (Maharashtra) based, DIL was
incorporated in 1994.The promoters have gained an experience of
around two decades in cotton processing industry through their
association with DIL. Being in the cotton industry for such a long
period has helped them in gaining adequate acumen about the
industry.DIL has a track record of more than two decades and has
strengthened its base in the seed processing and oil extraction.
* Diversified customer base: DIL supplies cotton bales, cotton seed
oil, cotton cake etc. to companies located in and around the
vicinity of Maharashtra like Dharam deep Commodities Private
Limited, Louis Dreyfus Commodities Private Limited (Madhya
Pradesh), Manjeet Cotton Private Limited and Rajshree Fibres to
name a few, along with retailing of the same and sales to local
players. DIL has a well diversified customer profile, which shields
it from the risk of decline in income from operations, due to lower
order from one particular customer.
DIL, was initially established in 1994, as a seed processing
company under the name Durgeshwari Seeds Private Limited (DSPL) and
was further converted into Public Ltd Company under the current
name in the year 2011. The operations of the entity are being
handled by Mr. Vijay Agrawal and his brothers. The entity operates
from its sole manufacturing plant at Parbhani (Maharashtra) with an
installed capacity of manufacturing 400 quintal bales per day.
EBUSINESSWARE (INDIA): Insolvency Resolution Process Case Summary
-----------------------------------------------------------------
Debtor: Ebusinessware (India) Private Limited
SCO 43, Old Judicial Complex
Sector-15, Gurgaon
Haryana 12001
India
Insolvency Commencement Date: May 18, 2020
Court: National Company Law Tribunal, Chandigarh Bench
Estimated date of closure of
insolvency resolution process: November 18, 2020
Insolvency professional: Jugraj Singh Bedi
Interim Resolution
Professional: Jugraj Singh Bedi
JSBA House
1250 Ground Floor
Mukherjee Nagar
Delhi 110009
E-mail: jb@jsba.in
Last date for
submission of claims: June 1, 2020
GAYATRI SEA: CARE Cuts Rating on INR18.50cr Loan to 'D', Not Coop.
------------------------------------------------------------------
CARE Ratings revised the ratings on certain bank facilities of
Gayatri Sea Foods & Feeds Private Limited (GSFFPL), as:
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Bank Facilities- 18.50 CARE D; Issuer Not Cooperating;
Fund Based-LT- Revised from CARE B; Stable;
Cash Credit on the basis of best available
information
Bank Facilities- 6.50 CARE D; Issuer Not Cooperating;
Non-Fund Based- Revised from CARE A4 on the
ST-Letter of Credit basis of best available
information
CARE had vide its press release dated December 16, 2019, placed the
ratings of GSFFPL under the 'issuer non-cooperating' category as
GSFFPL had failed to provide information for monitoring of the
rating. GSFFPL continues to be non-cooperative despite request for
submission of information through phone calls and an email dated
March 31, 2020, March 23, 2020 and February 19, 2020. In line with
the extant SEBI guidelines, CARE has reviewed the rating on the
basis of the best available information which however, in CARE's
opinion is not sufficient to arrive at a fair rating.
Users of this rating (including investors, lenders and the public
at large) are hence requested to exercise caution while using the
above ratings.
Detailed Rationale & Key Rating Drivers
The revision in ratings of GSFFPL factor in delays in servicing of
debt obligation as per due diligence conducted with lenders.
Detailed description of the key rating drivers
At the time of last rating on December 12, 2019, the following were
the rating strengths and weaknesses (updated for the information
received from lenders).
Key Rating Weaknesses
* Delays in debt servicing: The company has stretched liquidity
position with few instances of delays in servicing debt obligation,
in the recent past, as per due diligence with bankers. The company
has sought moratorium on interest payment for the month of April
2020 which has been given by bank.
* Leveraged capital structure with moderate debt coverage
indicators: The capital structure of the company remains leveraged
with the overall gearing ratio at 2.55x as on March 31, 2018,
although improved from 3.16x as on March 31, 2017. The interest
coverage ratio improved from 1.26x in FY17 to 1.59x in FY18 (Prov.)
along with other debt coverage indicators.
* Working capital intensive nature of the business: Gayatri Sea
Foods & Feeds Private Limited operates in a working capital
intensive industry wherein the requirement of working capital is
high.
* Competitive industry: The trading of aqua feeds and related
products is directly depended on the demand from aquaculture
production and is characterized by intense competition and
fragmentation due to the presence of innumerable unorganized
players attributable to low entry barriers.
Key Rating Strengths
* Experienced promoters: GSFPL has been promoted by Mr Nerella
Venkata Mohan Rao, who has over two decades of experience in the
rice milling and trading business. Presently, Mr V.V. Subrahmanyam
is the director of the company having an experience of two decades
and has been looking after supply management of the company. Mr.
V.V. Srinivasa Kumar is the other director of the company.
* Wide spread distribution network: The company procures about 30%
of the feeds from a reputed manufacturer based in Vietnam with whom
the company has fixed annual contract and acts as a dealer for
supply of its product in Indian market. GSFPL has a wide spread
distribution network with marketing of feeds done directly to a
large farmer base as well as through 15 sub-dealers.
* Improved financial performance during FY18 (Prov.): The scale of
operations of the company has been increasing y-o-y and it has
achieved a revenue growth of about 21% during FY18 (Prov.) from
INR105.44 crore in FY17 to INR127.06 crore. In line with revenue
growth, the PBILDT level and PAT level also increased during FY18
(Prov.) vis-à-vis FY17. However, the margins of the company
continue to remain on the lower side as the company is engaged in
low value additive trading activities.
Gayatri Sea Foods & Feeds Private Limited (GSFPL) was incorporated
on January 16, 2008 and has been promoted by Mr. Nerella Venkata
Mohan Rao based at Akiveedu, West Godavari district. The company is
engaged in trading of aqua feed and other aqua culture related
products. It is a dealer of Vietnam based company; Uni-President
Vietnam Co. Limited, for their aqua feed products in India. The
company supplies the feeds and other aquaculture products through a
sub-dealer network spread across West Godavari district as well as
directly to cultivators.
GEETANJALI GRAPHICS: Ind-Ra Lowers LongTerm Issuer Rating to 'D'
----------------------------------------------------------------
India Ratings and Research (Ind-Ra) has downgraded Geetanjali
Graphics' (GG) Long-Term Issuer Rating to 'IND D' from 'IND
BB-(ISSUER NOT COOPERATING).'
The instrument-wise rating actions are:
-- INR9.83 mil. (reduced from INR20.71 mil.) Term loan (Long-
term) due on December 2021 downgraded with IND D rating;
-- INR70 mil. (increased from INR34 mil.) Fund-based facilities
(Long-term) downgraded with IND D rating; and
-- INR11 mil. Non-fund-based facilities (Short-term) downgraded
with IND D rating.
KEY RATING DRIVERS
The downgrade reflects GG's delays in debt servicing of monthly
term loans, the details of which are not available.
RATING SENSITIVITIES
Positive: Timely debt servicing for the projected period could be
positive for the ratings.
COMPANY PROFILE
GG was established as a partnership firm in 1979 and was
reconstituted as a sole proprietorship in April 2000. The firm is
promoted by Mr. Nagasundar. It has an installed printing capacity
of 20 tons of paper per day.
GMR WARORA: Ind-Ra Hikes Non-Convertible Debentures Rating to 'B'
-----------------------------------------------------------------
India Ratings and Research (Ind-Ra) has upgraded GMR Warora Energy
Limited's (GWEL) non-convertible debentures' (NCDs) rating to 'IND
B' from 'IND D'. The Outlook is Stable.
The detailed rating action is:
-- INR750 mil. NCDs* upgraded IND B/Stable rating.
*Details given in Annexure
KEY RATING DRIVERS
Regular Debt Servicing and Deferment in Put Option Date: The
upgrade reflects the timely debt service of senior debt from
December 2019 and the amendment of the debenture trust deed (DTD)
to defer the put option date to September 25, 2020, from September
25, 2019. The rated bonds have semi-annual coupon payments on March
25, and September 25, until the maturity of the bonds on November
25, 2023. GWEL has not delayed interest payments on NCDs to date,
except a one day delay in September 2019 in meeting additional
interest, which changes based on the credit rating. As per the DTD,
a delay of 30 days from the due date is allowed for NCDs before
being recognized as a default.
In August 2019, the bondholders exercised the put option, post
which GWEL requested for a waiver in the put option date, and the
same was agreed by the bondholder. Consequently, an amendment to
the DTD was signed on October 10, 2019, changing the put option
date to September 25, 2020. In the amendment, the stipulation of
additional security for NCDs includes GMR Energy Limited's revised
corporate guarantee and pledge of 37.5 million equity shares of GMR
Bajoli Holi Hydropower Private Limited. GWEL has also agreed to
prepay up to 20% of NCDs depending on the ratio of the total
outstanding loan to a total net worth of GMR Energy in each
financial year.
Liquidity Indicator– Poor: As of May 28, 2020, GWEL faced
liquidity concerns as its working capital debt limits of INR6,200
million were inadequate for its working capital requirements and it
was yet to create its debt service reserve. The lead lender has
allowed GWEL time until September 30, 2020, to create a debt
service reserve. GWEL's receivable days decreased to around 128 in
FYE20 (FYE19: 152) due to improvement in payments from power
purchase agreement (PPA) counterparties and establishment of letter
of credit under PPAs. GWEL expects higher cashflows from
counterparties in 2QFY21, as COVID-19 related lockdown eases and
the liquidity scheme of lending INR900 billion from Power Finance
Corporation Limited and REC Limited ('IND AAA'/Stable) to
distribution utilities helps counterparties clear their overdue. As
of May 28, 2020, GWEL's cash balance and investments were around
INR150 million and it had INR6,200 million working capital
facility, INR4,050 million of which is the common sub-limit for a
cash credit and the letter of credit. The project's working capital
utilization as of FYE20 was 80%.
GWEL has already availed moratorium for its term loan and working
capital loan until May 2020 and has requested lenders to allow
moratorium until August 31, 2020, under the Reserve Bank of India's
COVID-19 regulatory package. Payments from PPA counterparties have
slowed down during the lockdown, weighing on GWEL's liquidity
profile. GWEL is using a usance letter of credit of six-month tenor
to purchase coal, unlike the previous requirement of making
payments in advance.
Increase in Revenue Risk: GWEL's PPA with Dadra and Nagar Haveli
(DNH) for 200MW will expire by June 2020 and as of May 28, 2020, it
was yet to tie-up any new PPA. GWEL has informed the agency that
merchant sale at INR3.5/kWh is possible in the interim, while GWEL
is trying to extend PPA with DNH for a few quarters. Alternately,
GWEL is exploring group captive tie-up.
In FY20, GWEL declared above 85% plant availability under all three
PPAs; GWEL has long-term take-or-pay PPA for 100% net capacity with
DNH, Maharashtra State Electricity Distribution Limited (200MW;
valid until March 2039) and Tamil Nadu Generation and Distribution
Corporation Limited ('IND BBB'/Negative; 150MW; valid until
September 2028). The agreements have a two-part tariff mechanism,
comprising capacity and variable charges, linked to the Central
Electricity Regulatory Commission's inflation index (updated every
six months). The compensatory tariff orders are in place, thus
providing revenue visibility under the PPAs. GWEL has no concerns
over coal supply and inventory currently. In FY20, the plant load
factor was 79% (FY19: 74%).
High Debt Level Concerning: GWEL's total outstanding term loan and
NCDs stood at INR28,590 million, as of March 31, 2020. The NCDs
amortize in three tranches of INR250 million each on September 25,
2022, September 25, 2023, and November 25, 2023. Coupon payments on
the NCDs are semi-annual. Financial covenants under the DTD include
minimum fixed asset coverage ratio of 1.0x, minimum asset coverage
ratio of 1.0x, and for trailing 12 months, debt service coverage
ratio of not below 1.0x. The project's debt service coverage in
FY19 was 1.35x but adverse receivable position affected its debt
servicing.
The term loan amortizes over 16 years in an even manner. Ind-Ra has
considered the entire senior debt in its analysis. With respect to
the delay in a term loan, all overdue were cleared in December 2019
from improved revenue realization from counterparties.
RATING SENSITIVITIES
Positive: Firm PPA tie-up for 200MW post-June 2020, receivable days
reducing below 60 days, and liquidity availability/visibility for
one year will be positive for the rating.
Negative: Exercising of the put option by bondholder, continued
working capital utilization above 95% and absence of clarity in
cashflows to meet debt service including the put option payment if
exercised, in September 2020 will be negative for the rating.
COMPANY PROFILE
GWEL is a special purpose vehicle incorporated to build, maintain
and operate a 600MW (two units of 300MW each) coal-fired, the
subcritical technology-based thermal power plant in Warora,
Maharashtra. GMR Energy Limited is the primary sponsor of the
project, with 100% equity investment. GMR Energy is held by GMR
Infrastructure Limited (52%), Tenaga Nasional Berhad (30%), and
private equity investors (18%).
Coal supply is secured through a fuel supply agreement with
state-owned South Eastern Coal Fields, a Coal India Limited
subsidiary, for an annual contracted quantity of 2.60 million
tonnes.
INDIA INFOLINE: Moody's Cuts CFR & Sr. Sec. Debt Rating to B1
-------------------------------------------------------------
Moody's Investors Service has downgraded the corporate family
rating and senior secured debt rating of India Infoline Finance
Limited to B1 from Ba3. Moody's has also downgraded the senior
secured program rating of India Infoline Finance to (P)B1 from
(P)Ba3.
At the same time, Moody's has placed the ratings under review for
further downgrade.
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. Moody's expects
Indian non-bank finance companies to be affected by the shock as
disruptions to India's economic activity from the coronavirus
outbreak will weaken the credit fundamentals of these companies.
Moody's regards the coronavirus outbreak as a social risk under its
environmental, social and governance framework, given the
substantial implications for public health and safety.
Its action follows the review for downgrade initiated on April 13,
2020, and reflects the impact on India Infoline Finance of the
breadth and severity of the shock and the deterioration in credit
quality it has triggered.
Like other NBFCs, Moody's expects India Infoline Finance's funding
and liquidity to remain under strain over the next few quarters as
the domestic debt markets remain largely closed to many NBFCs. And
while the Indian government's (Baa2 negative) planned support
measure to subscribe to INR300 billion of NBFC debt will provide
some near-term relief, this will not sufficiently address NBFCs'
funding issues.
Moody's also expects Indian banks to extend support to the NBFCs
via loan moratoriums or by providing new term loans to the
companies.
Despite these measures, Moody's expects India Infoline Finance's
funding and liquidity to remain strained as inflows from assets
will materially decline, while the company will continue to need to
service interest and principle on liabilities, such as capital
markets liabilities, that cannot be rescheduled without default.
India Infoline Finance's modest liquidity offers limited support if
funding conditions do not improve over the next few quarters.
Also, the moratorium on debt repayments can hinder its ability to
conduct loan assignments -- the outright sale of loans to banks --
and securitization, which have been a source of immediate liquidity
since mid-2018.
Moody's expects India Infoline Finance's asset quality will weaken
as loan delinquencies and defaults increase because customers and
businesses face a drop in earnings and cash flows due to the
economic disruption caused by the coronavirus outbreak.
While the Reserve Bank of India's forbearance for banks and NBFCs
-- whereby they can extend 6-month loan repayment moratoriums to
customers without affecting the asset classification -- will soften
some of the near-term strain on asset quality, but the sharp
slowdown in India's economic growth will exacerbate asset quality
issues for the company.
Capital remains a credit strength of India Infoline Finance.
Moody's expects capital to remain modestly decline as the company
looks to conserve liquidity, with no plans to expand its balance
sheets materially unless funding conditions normalize.
This rating action considers the consolidated financials of IIFL
Finance Limited, the legal entity that has acquired all of India
Infoline Finance Limited's assets and liabilities as of April 1,
2020.
India Infoline Finance's ratings remain under a review for
downgrade as Moody's expects near-term stress on its funding and
liquidity that could further weaken its credit profile.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS
Given the review for downgrade, India Infoline's ratings are
unlikely to be upgraded in the next 12-18 months. Nevertheless,
Moody's will confirm the ratings if the company strengthens its
balance by (1) refinancing or raising new funding over the next few
quarters, or (2) improving collection rates on its assets such that
the company is able to meet its maturing obligations without
straining its liquidity.
India Infoline Finance's rating could be downgraded if the
company's liquidity deteriorates. The rating could also be
downgraded if there is a significant deterioration in its asset
quality leading to a worsening of its solvency metrics.
The principal methodology used in these ratings was Finance
Companies Methodology published in November 2019.
Headquartered in Mumbai, India Infoline Finance Limited reported
total assets of INR312 billion at December 31, 2019.
List of Affected Ratings:
Issuer: India Infoline Finance Limited
Long-term Corporate Family Rating, Downgraded to B1 from Ba3; Under
Review for further Downgrade
Long-term Senior Secured Medium-Term Note Program (Foreign and
Local Currency), Downgraded to (P)B1 from (P)Ba3; Under Review for
further Downgrade
Long-term Senior Secured Debt (Foreign Currency), Downgraded to B1
from Ba3; Under Review for further Downgrade
Outlook remains ratings under review.
INDIA MEGA: CARE Keeps D INR25cr Debt Rating in Not Cooperating
---------------------------------------------------------------
CARE Ratings said the rating for the bank facilities of India Mega
Agro - Anaj Limited (IMA) continues to remain in the 'Issuer Not
Cooperating' category.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long term Bank 25.00 CARE D; Issuer not cooperating;
Facilities Based on best available
Information
Detailed Rationale & Key Rating Drivers
CARE had, vide its press release dated September 6, 2018, January
2, 2019, placed the rating of IMA under the 'issuer
non-cooperating' category as IMA had failed to provide information
for monitoring of the rating. IMA continues to be non-cooperative
despite repeated requests for submission of information through
e-mails, phone calls and a email dated May 14, 2020. In line with
the extant SEBI guidelines, CARE has reviewed the rating on the
basis of the best available information which however, in CARE's
opinion is not sufficient to arrive at a fair rating.
Users of this rating (including investors, lenders and the public
at large) are hence requested to exercise caution while using the
above rating.
Detailed description of the key rating drivers
Key Rating Weaknesses
* On-going delays in debt servicing: The lender has confirmed that
the company has been classified as NPA by them due to on-going
delays in debt servicing.
Analytical approach: Combined.
For arriving at the rating, CARE has combined the business and
financial risk profiles of IMA and Datta Krupa Roller Flour Mill
Private Limited (DRFM - rated CARE D, Issuer Not Cooperating)
hereinafter referred as Dattakrupa Group (DKG). Both companies are
under common management with similar nature of operations and
product portfolio. Moreover the combined approach is also based on
common shareholders and undertaking from the promoter-director
ensuring financial fungibility between the companies whenever
required.
India Mega Agro - Anaj Limited (IMA) was incorporated in 2010 by
promoter cum managing director: Mr. Ajay Kumar Baheti. IMA is a
part of Dattakrupa group which was formed in the year 2005 through
incorporation of Datta Krupa Roller Flour Mill Private Limited
(DRFM) at Prabhani. The group started its manufacturing activity
with processing of flour mill and dal mill. Later in order to
expand & diversify its operations and avail various government
benefits attached to the food processing industries, the group
incorporated IMA; which was set up by acquiring 50 acres on lease
at MIDC in Krushnoor district, Nanded. Over the period of time,
the group has set-up various food processing divisions like roller
flour mill; cattle & poultry unit in 2015; dal & rice mill in 2016;
oil mill & refinery, solvent & biscuit unit in 2017. Currently the
group has two manufacturing units located at Prabhani and Nanded.
INDIA POWER: Insolvency Resolution Process Case Summary
-------------------------------------------------------
Debtor: India Power Corporation (Bodhgaya) Limited
Registered office:
Plot X 1, 2 & 3
Block-EP, Sector-V
Salt Lake
Kolkata 700091
(W.B.)
Principal office:
1st and 2nd Floor, Zion Complex
Opp. Fire Bridgade
Swarajpuri Road
Gaya 823001
(Bihar)
Insolvency Commencement Date: May 22, 2020
Court: National Company Law Tribunal, Kolkata Bench
Estimated date of closure of
insolvency resolution process: November 18, 2020
(180 days from commencement)
Insolvency professional: Savita Agarwal
Interim Resolution
Professional: Savita Agarwal
R. Kothari & Company
16A, Shakespeare Sarani
5th Floor
Kolkata 700071
E-mail: savita_22@hotmail.com
cirp.ipcbl@gmail.com
Last date for
submission of claims: June 8, 2020
NEHA INTERNATIONAL: CARE Keeps 'D' Debt Ratings in Not Cooperating
------------------------------------------------------------------
CARE Ratings said the rating for the bank facilities of Neha
International Limited (NIL) continues to remain in the 'Issuer Not
Cooperating' category.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long-term Bank 5.60 CARE D; Issuer not cooperating;
Facilities Based on the best available
Information
Short term bank 23.50 CARE D; Issuer not cooperating;
facilities Based on the best available
Information
Detailed Rationale & Key Rating Drivers
CARE had, vide its press release dated March 18, 2019 placed the
ratings of NIL under the 'issuer non-cooperating' category as NIL
had failed to provide information for monitoring of the rating. NIL
continues to be noncooperative despite repeated requests for
submission of information through e-mails, phone calls and a email
dated May 4, May 5 and May 6. In line with the extant SEBI
guidelines, CARE has reviewed the rating on the basis of the best
available information which however, in CARE's opinion is not
sufficient to arrive at a fair rating.
Users of this rating (including investors, lenders and the public
at large) are hence requested to exercise caution while using the
above rating).
Detailed description of the key rating drivers
At the time of last rating on March 18, 2019 the following were the
rating strengths and weaknesses
Key Rating Weaknesses
Rating weakness
* Delay in meeting the debt obligations on time: The company has
been delaying in meeting the debt obligations on time on account of
strain in the liquidity position.
Established in 1993, Neha International Ltd (NIL) is engaged into
trading of agricultural products mainly Maize, Soya Bean, Sun
Flower, Edible oils etc. The company has been promoted by Mr G
Vinod Reddy, who has about two decades of experience in the line of
activity. The company got listed on BSE expand in February 1995.
Neha at the group level is into floriculture space also exporting
cut roses to Europe and Middle Eastern markets in Saudi Arabia,
Qatar and UAE, through its subsidiaries (based in Ethiopia) and
step down subsidiaries. Being primarily into trading, the company
procures the agricultural products from small local traders and
sells it to big traders & poultry farms domestically.
ORBIT ELECTRO: Ind-Ra Cuts & Moves LT Issuer Rating to D, Not Coop.
-------------------------------------------------------------------
India Ratings and Research (Ind-Ra) has downgraded Orbit Electro
Equipments Private Limited's (OEEPL) Long-Term Issuer Rating to
'IND D' from 'IND BB', while simultaneously migrating the rating to
the non-cooperating category. The Outlook was Stable. The issuer
did not participate in the rating exercise despite continuous
requests and follow-ups by the agency. Therefore, investors and
other users are advised to take appropriate caution while using
these ratings. The rating will now appear as 'IND D (ISSUER NOT
COOPERATING)' on the agency's website.
The instrument-wise rating action is:
-- INR127.5 mil. Fund-based working capital facilities (Long-
term/Short-term) downgraded and migrated to non-cooperating
category with IND D (ISSUER NOT COOPERATING)* rating.
* Note: Issuer did not cooperate; based on best-available
information
KEY RATING DRIVERS
The downgrade reflects continued overutilization of fund-based
limits for more than 30 days in the during the past six months
ended May 2020 on account of low sales and receivables resulting in
deterioration in liquidity. The company's office in Maharashtra was
raided by the Goods and Services Tax department in November 2019
wherein all the accounts data, servers, and computers were seized
by the tax officials, resulting in a slowdown in revenue booking
and realization of receivables, which resulted in the company's
tight liquidity.
RATING SENSITIVITIES
Positive: Timely debt servicing for at least three consecutive
months could result in a rating upgrade.
COMPANY PROFILE
Started in 2008, OEEPL manufactures electrical panels and fire
panels. It is also engaged in fabrication, powder coating, and wire
harnessing. OEEPL's manufacturing unit is located in Maharashtra.
POSHS METAL: Ind-Ra Assigns 'BB' LT Issuer Rating, Outlook Stable
-----------------------------------------------------------------
India Ratings and Research (Ind-Ra) has assigned Poshs Metal
Industries Private Limited (PMIPL) a Long-Term Issuer Rating of
'IND BB'. The Outlook is Stable.
The instrument-wise rating action is:
-- INR10 mil. Fund-based facilities assigned with IND BB /
Stable/IND A4+ rating.
Analytical Approach: To arrive at the ratings, Ind-Ra has taken
consolidated view of PMIPL, and its subsidiaries Poshs Cinoti
Private Limited (99.9% shares held by PMIPL) and Ayasto Steel Pac
Private Limited (99.9%) since there are operational and legal
linkages among the entities.
KEY RATING DRIVERS
The ratings reflect the group's modest credit metrics with EBITDA
interest coverage (operating EBITDA/gross interest expense) of 1.9x
in FY19 (FY18: 1.9x) and net leverage (adjusted net debt/operating
EBITDAR) of 4.5x (4.5x). Despite increase in the consolidated debt
to INR1,232 million (FY18: INR1,001 million), the consolidated
credit metrics remained stable due to an increase in the operating
EBITDA to INR265 million (FY18: INR221 million). Ind-Ra estimates
the overall credit metrics to have deteriorated in FY20 primarily
due to a reduction in the operating EBITDA and high debt levels.
Liquidity Indicator - Poor: PMIPL's average utilisation of
fund-based working capital limits was 98.8% over the 12 months
ended March 2020. The cash flow from operations turned negative in
FY19 primarily on account of an increase in the working capital
requirements. In FY19, the inventory days increased to 46 (FY18:
29) as the group had procured and stored the raw materials at the
year-end majorly for its auto division. The debtor days have been
in the range of 50-70 and the creditor days in the range of 25-30
days over FY17-FY19. The net cash conversion cycle continued to be
stretched at FYE20, based on the delays in receivables from
customers and high inventory levels due to the stoppage of
production due to the lockdown following the COVID-19 outbreak. The
group has repayment obligation of INR50.4 million and INR66.4
million in FY21 and FY22, respectively, which is likely to be
serviced through its internal accruals. It has availed a moratorium
for its long-term facilities over March-August 2020 under the
Reserve Bank of India's COVID-19 regulatory package scheme.
The ratings also factor in the group's medium scale of operations.
While the group is generating revenue from steel service centres,
the manufacturing and selling of shaped blanks (auto division) and
infrastructure activities, the auto division is contributing more
than the rest to the consolidated revenue. The group's revenue grew
consistently over FY17-FY19, primarily on account of the continuous
increase in revenue from the auto division. On a consolidated
basis, the group's revenue grew 12.2% yoy to INR5,313 million in
FY19 (FY18: up 27.5% yoy). In FY20, Ind-Ra estimates, the
consolidated revenue to have deteriorated primarily on a reduction
in the revenue contribution from one of the top customers in the
auto division. Secondly, the slowdown in the auto sector in FY20
resulted lower demand during the year. Additionally, the drop in
steel prices led to a reduction in the average realization during
FY20. According to the provisional numbers, the group achieved
consolidated revenue of INR3,970 million in 11MFY20.
The ratings factor in the group's average operating profitability
that remained in the range of 4%-5% over FY17-FY19. During FY19,
the operating profitability increased slightly due to the better
margins from the infrastructure business; the margins are likely to
remain at the similar levels in the near term. Ind-Ra estimates the
operating profitability to have been in the range of 4%-4.5% in
FY20. The return on capital employed was 14% in FY19 (FY18: 14%).
The ratings draw comfort from the group's healthy relationship with
customers and suppliers and its presence in a diversified end-user
industry. Within the group, PMIPL is generating the majority of
revenue as it is the authorised steel service centre for Tata Steel
Limited ('IND AA'/Negative) and is also engaged in the
manufacturing of shaped blanks and selling to original equipment
manufacturers through its tier 1 suppliers. The group's
infrastructure business also supported by healthy relationship with
reputed players such as AFCONS Infrastructure Limited, Larsen &
Toubro Limited ('IND AAA'/Stable), NCC limited ('IND A'/Rating
Watch Negative), J Kumar Infraprojects Ltd ('IND A+'/Stable), etc.
The group is procuring a majority of its raw materials from Tata
Steel, then processing and selling to various industries such as
automotive and construction industry. In addition, the group's
revenue is also protected, backed by the agreements signed between
Tata Steel and PMIPL.
The ratings are also supported by the promotors' over a decade-long
experience in the manufacturing shape blanks of steel for the auto
sector.
Standalone Profile: On a standalone basis, PMIPL's revenue was
INR4,976 million in FY19 (FY18: INR 4,735 million). The operating
profitability of the company remained stable in the range of
4.3%-4.5% over FY16-FY19 due to its ability to pass on the
fluctuations in the prices of raw materials. Despite an increase in
the total debt to INR1,022 million in FY19 (FY18: INR1,001
million), the net leverage of the company improved to 4.5x (4.9x)
on account of an increase in the operating EBITDA to INR219 million
(INR204 million), while the interest coverage deteriorated
marginally to 1.7x (1.8x) due to a rise in the interest expenses to
INR126 million (INR113 million). In 11MFY20 (provisional), the
financial profile of the company weakened with revenue of
INR3,624.2 million and operating profitability of 3.4%. The overall
credit metrics of the company are estimated to have deteriorated
significantly with interest coverage of 1.2x and leverage of 6.8x
at FYE20. This was primarily on account of a reduction in absolute
EBITDA due to lower sales.
RATING SENSITIVITIES
Negative: Deterioration in the scale of operation and the
consolidated operating EBITDA leading to any deterioration in
credit metrics with interest coverage below 1.7x and weakened
liquidity will lead to a negative rating action.
Positive: An improvement in the scale of operation and the
operating EBITDA leading to an improvement in the credit metrics
with interest coverage above 1.7x and improved liquidity will lead
to a positive rating action.
COMPANY PROFILE
The Poshs Group is engaged in varied businesses and caters mainly
to the auto and infrastructure industries. PMIPL was incorporated
in December 1998. The company is a steel servicing centre and also
engaged in the manufacturing of shape blanks of steel at the plants
located at Taloja and Pune.
PRABHU PETROCHEMICALS: CARE Assigns D Rating to INR13.14cr Loan
---------------------------------------------------------------
CARE Ratings has assigned rating to the bank facilities of Shree
Prabhu Petrochemicals Private Limited (SPPPL), as:
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long-term Bank
Facilities 13.14 CARE D Assigned
Detailed Rationale & Key Rating Drivers
The rating assigned to the bank facilities of SPPPL takes into
account delay in repayment of debt obligation.
Rating Sensitivities
Positive Factors
* Demonstration of default free track record of over 90 days.
Detailed description of the key rating drivers
Key Rating weaknesses
* Delay in servicing of debt obligation: As per interaction with
the banker there have been delays in the repayment of term loan.
The delays were on account of poor liquidity position.
Liquidity: Poor
Poor liquidity marked by lower accruals when compared to repayment
obligations. This has constrained the ability of the company to
repay its debt obligations on a timely basis.
Shree Prabhu Petrochemicals Private Limited (SPPPL) was
incorporated in 2012 by Mr. Somnath Sakre and Mr.Kachrulal Karwa.
SPPPL is engaged in manufacturing of plastic water tanks, drip
irrigation pipes, HDP Pipes, SWP Pipes. SPPPL has manufacturing
facility located Aurangabad, having an aggregate installed capacity
to manufacture 6700 tonnes per annum (TPM).
PRASAD EXTREME: CARE Lowers Rating on INR9.0cr Loan to 'D'
----------------------------------------------------------
CARE Ratings revised the ratings on certain bank facilities of
Prasad Extreme Digital Cinema Network Private Limited (PXD), as:
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long-term Bank 9.00 CARE D; Issuer not cooperating;
Facilities Revised from CARE B+; Stable;
ISSUER NOT COOPERATING on the
basis of best available
information
Detailed Rationale & Key Rating Drivers
CARE had, vide its press release dated March 22, 2019 placed the
rating(s) of PXD under the 'issuer non-cooperating' category as PXD
had failed to provide information for monitoring of the ratings.
PXD continues to be non-cooperative despite repeated requests for
submission of information through e-mails, phone calls and emails
dated April 22, 2020 & April 23, 2020 In line with the extant SEBI
guidelines, CARE has reviewed the rating on the basis of the best
available information which however, in CARE's opinion is not
sufficient to arrive at a fair rating.
Users of this rating (including investors, lenders and the public
at large) are hence requested to exercise caution while using the
above rating.
Detailed description of the key rating drivers
The revision in the rating takes into account the non-availability
of requisite information due to non-cooperation by PXD with CARE's
efforts to undertake a review of the outstanding ratings as CARE
views information availability risk as key factor in its assessment
of credit risk profile. The rating to the bank facilities of PXD
continues to be tempered by small scale of operations, working
capital intensive nature of operations, and technological
obsolescence risk. The rating also factors in decline in total
operating income, PBILDT margins and net loss in FY19 (Refers to
the period April 01-March 31). The rating, however, continues to
derive strength from Long experience of promoters for more than
five decades and Comfortable capital structure and debt protection
metrics.
Key Rating Weakness
* Small scale of operations with declining total operating income:
The scale of operations of the company continues to be small and
declining in trend marked by TOI of INR12.97Crore in FY19 as
against INR13.40 Crore in FY18.
* Net loss in FY19: The PBILDT margin of the company has dropped by
304bps however stood healthy at 51.98% in FY19 as against 55.02% in
FY18. Owing to high depreciation provisions and interest costs, the
company has incurred net loss of INR0.99 Crore in FY19.
* Working capital intensive nature of operations: The nature of
the operations of the company continues to be working capital
intensive in nature, on account of elongated operating cycle. The
operating cycle has elongated in FY19 to 89 days as against 41 days
in FY18 on account of higher collection period of 106 days.
* Technological obsolescence risk: Digital technologies are prone
to technological obsolescence. With newer technologies/improvements
introduced so fast, the existing digital equipment's might get
outdated faster and some of them may not be upgradeable to newer
technologies, introducing a higher risk on investing in them. Hence
PXD is prone to technological obsolescence risk.
Key Rating Strengths
*Long experience of promoters for more than five decades: PXD was
established in the year 2013 and is a part of Prasad group that
holds track record for more than six decades in providing post
production services to Indian film industry. Mr. Ramesh Prasad,
Managing director and his family members Mr. Sai Prasad & Mr. M. K
Prasad collectively has more than five decades of experience in
providing post production services by associating themselves with
Prasad group. However, PXD has been incorporated in the year 2013
which provides digital cinema solutions and has track record of
five years in providing digital cinema solutions to theatres across
Tamilnadu, Kerala, Andhra Pradesh and
Maharashtra.
* Comfortable capital structure and debt protection metrics: With
minimal debt profile, the capital structure of the company stood
comfortable, marked by overall gearing of 0.52x as on March 31,
2019. Also the debt protection metrics are also stood healthy
marked by TD/GCA of 0.14x as on March 31, 2019.
Prasad Extreme Digital Cinema Network Private Limited (PXD) was
established in 2013 as a Private Limited Company, promoted by Mr.
Ramesh Prasad and his family members (Mr. Sai Prasad & Mr M. K.
Prasad). PXD is the associate company of reputed Prasad group which
is engaged in Film making, Post production & Digital technology
services in Indian film industry since 1956 promoted by Dada Saheb
Phalke Award recipient Mr.L.V. Prasad. Prasad Productions Private
Limited is the flagship company of Prasad group that engages in
Post production services. PXD provides digital cinema solutions by
making available equipments (Projectors, Lens, Lamps & 3 D lamps)
and software to facilitate playback of feature films and other
digital content in theatres. PXD has entered into agreement with
more than 230 theatres in and around four states of Tamilnadu,
Kerala, Andhra Pradesh & Maharashtra for providing cinema solutions
with tenure period of 5-10 years. The revenue generated includes
exhibiting services provided by the company and share of revenue
generated by way of advertisement broadcasted in theatres and other
medium. The company also provides maintenance services and
replacement of auxiliary parts attached to the projections. The
registered office is located in Chennai, Tamilnadu.
R. E. CABLES: CARE Maintains D Debt Ratings in Not Cooperating
--------------------------------------------------------------
CARE Ratings said the rating for the bank facilities of R. E.
Cables & Conductors Private Limited (RECC) continues to remain in
the 'Issuer Not Cooperating' category.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long-term Bank 62.80 CARE D; Issuer not cooperating;
Facilities Based on the best available
Information
Short term bank 50.00 CARE D; Issuer not cooperating;
facilities Based on the best available
Information
Detailed Rationale & Key Rating Drivers
CARE had, vide its press release dated March 26, 2019 placed the
ratings of RECC under the 'issuer non-cooperating' category as RECC
had failed to provide information for monitoring of the rating.
RECC continues to be non-cooperative despite repeated requests for
submission of information through e-mails, phone calls and emails
dated May 4, May 5 and May 6. In line with the extant SEBI
guidelines, CARE has reviewed the rating on the basis of the best
available information which however, in CARE's opinion is not
sufficient to arrive at a fair rating.
Users of this rating (including investors, lenders and the public
at large) are hence requested to exercise caution while using the
above rating).
Detailed description of the key rating drivers
At the time of last rating on March 26, 2019 the following were the
rating strengths and weaknesses
Key Rating Weaknesses
* Ongoing delays in meeting of debt obligations: The Company was
unable to generate sufficient cash flows leading to strained
liquidity position resulting in ongoing delays in meeting its debt
obligations on time.
Incorporated in 1993, R.E Cables and Conductors Private Ltd (RECC)
is promoted by Mr Ramesh Jain and Mr Hitesh Jain. RECC is engaged
in the business of designing, manufacturing and marketing of All
Aluminum Stranded Conductors (AAC), All Aluminum Alloy Stranded
Conductors (AAAC), All Aluminum conductors galvanized steel
reinforced (ACSR), Double paper covered (DPC) Wires & Strips
cables, Aerial Bunched (AB) Cables and Power Cables and Bare
Aluminium/Aluminium Alloy Wires and strips and submersible copper
wires. These cables and conductors find its use in power generating
and distributing companies. The company markets the cables and
conductors under 'RECC' brand. RECC has four manufacturing
facilities of which three are in Cherlapally, Hyderabad and the
fourth one is at Keesara Mandal, Ranga Reddy District, Telangana
State. The total installed capacity of all the four units is
59,000 Tonnes Per Annum (TPA).
RATTAN POLYCHEM: CARE Keeps 'D' Debt Ratings in Not Cooperating
---------------------------------------------------------------
CARE Ratings said the rating for the bank facilities of Rattan
Polychem Private Ltd (RPPL) continues to remain in the 'Issuer Not
Cooperating' category.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long term Bank 13.00 CARE D; Issuer Not Cooperating;
Facilities Based on best available
Information
Short term Bank 5.00 CARE D; Issuer Not Cooperating;
Facilities Based on best available
Information
Long Term Bank 12.00 CARE D; Issuer Not Cooperating;
Facilities/Short on the basis of best available
Term Bank information
Facilities
Detailed Rationale & Key Rating Drivers
CARE had, vide its press release dated February 18, 2019, placed
the ratings of RPPL under the 'issuer non-cooperating' category as
Rattan Polychem Private limited had failed to provide information
for monitoring of the rating. Rattan Polychem Private limited
continues to be non-cooperative despite repeated requests for
submission of information through e-mails, phone calls and a
letter/email dated April 8, 2020, April 10, 2020. In line with the
extant SEBI guidelines, CARE has reviewed the rating on the basis
of the best available information which however, in CARE's opinion
is not sufficient to arrive at a fair rating.
Users of this rating (including investors, lenders and the public
at large) are hence requested to exercise caution while using the
above ratings.
The rating has been reaffirmed by taking into account
non-availability of requisite information and no due-diligence
conducted due to non-cooperation by Rattan Polychem Private limited
with CARE'S efforts to undertake a review of the rating
outstanding. CARE views information availability risk as a key
factor in its assessment of credit risk.
Detailed description of the key rating drivers
At the time of last rating on February 18, 2019 the following were
the rating weaknesses and strengths.
Key Rating Weakness
* Ongoing delays in servicing debt obligation: There are ongoing
delays in servicing of debt obligations on account of stretched
liquidity position.
Faridabad (Haryana) based, Rattan Polychem Private Ltd (RPPL)
incorporated in December 3, 2009 is promoted by Mr. Yashvir Singh
Dagar and Mrs. Darshana Dagar. The company is engaged in
manufacturing of Expandable polystyrene (EPS) of various grades
ranging from RPCL 1218 to RPCL 9100. The manufacturing facility of
the company is located at Faridabad, Haryana. EPS is a major raw
material for manufacturing of 'Thermo Cole' products which finds
applications in thermal insulation of buildings, cold storage,
industrial refrigeration and air conditioning. RPCL mainly procures
raw material namely styrene from importers and sells the product in
domestic market through its own network. Further, the company sells
EPS to packing material and construction companies in Gujarat,
Haryana, Uttarakhand, Uttar Pradesh, Delhi, Chennai and Rajasthan.
REETHU TOBACCO: CARE Keeps D INR7.60cr Debt Rating in Not Coop.
---------------------------------------------------------------
CARE Ratings said the rating for the bank facilities of Reethu
Tobacco Traders (RTT) continues to remain in the 'Issuer Not
Cooperating' category.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long-term Bank 7.60 CARE D; Issuer not cooperating;
Facilities Based on the best available
Information
Detailed Rationale & Key Rating Drivers
CARE had, vide its press release dated February 4, 2019, placed the
ratings of RTT under the 'issuer non-cooperating' category as
company had failed to provide information for monitoring of the
rating. The company continues to be non-cooperative despite
repeated requests for submission of information through e-mails,
phone calls and email dated April 28, 2020 .In line with the extant
SEBI guidelines, CARE has reviewed the rating on the basis of the
best available information which however, in CARE's opinion is not
sufficient to arrive at a fair rating.
Users of this rating (including investors, lenders and the public
at large) are hence requested to exercise caution while using the
above rating.
Detailed description of the key rating drivers
At the time of last rating on February 4, 2019 the following were
the rating strengths and weaknesses:
Key Rating Weaknesses
* Delay in debt servicing: The firm has delays in servicing of
debt obligations owing to the stretched liquidity position of the
firm.
Key Rating Strengths
* Experience of the proprietor for more than two decades in tobacco
industry: RTT was established in the year 2010 and promoted by Mr.
Gogineni Venkateswara Rao. The proprietor is an undergraduate and
has more than two decades of experience in tobacco industry as he
had worked in same line of business i.e., Gogineni Tobaccos.
Business operations are supported by key managerial personnel i.e.
Mr. Sri Hari. Due to long experience of the proprietor, he is able
to establish long term relationship with clientele which has helped
in developing business.
Andhra Pradesh based, Reethu Tobacco Traders (RTT) was established
in the year 2010 as a proprietorship concern by Mr. Gogineni
Venkateswara Rao. Mr. Gogineni Venkateswara Rao is an authorized
licensed holder from Government of Andhra Pradesh for processing
and selling of Virginia tobacco. RTT is mainly engaged in
processing and selling of Virginia tobacco. The firm purchases the
raw material i.e., Wet Virginia tobacco through the competitive
bidding process conducted by Tobacco Board (TB) at Andhra Pradesh
location. The TB collects the tobaccos from farmers, who are
licensed holder to grow any particular tobacco. Further, these
tobaccos are put in tender process. After successfully winning the
tender, the firm processes the Virginia tobacco manually by
separating the tobacco leaves, with the help of local contractual
workers. After separation of tobacco leaves, the firm outsources
the process like threshing to B K Threshers Private Limited located
at Tangutur, Prakasam District, Andhra Pradesh. Threshing process
involves conditioning of tobacco with heat and moisture, and
finally re-drying the Virginia tobacco. BKTPL further pack these
threshed tobaccos and delivers to RTT for selling to various
clients. The processing unit for separation of tobacco leaves is
located at Tangutur (Andhra Pradesh) which is 25 km away from
Ongole (Andhra Pradesh) where tobacco is one of the major crops.
The firm has reputed client base like Godfrey Phillips India
Limited and Premier Tobacco Packers Private Limited who contributed
40% and 45% of total sales respectively in FY17.
RESURGENT POWER: CARE Keeps 'D' Debt Ratings in Not Cooperating
---------------------------------------------------------------
CARE Ratings said the rating for the bank facilities of Resurgent
Power Projects Limited (RPPL) continues to remain in the 'Issuer
Not Cooperating' category.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long-term Bank 24.00 CARE D; Issuer not cooperating;
Facilities Based on the best available
Information
Short term bank 7.00 CARE D; Issuer not cooperating;
facilities Based on the best available
Information
Long-term/Short- 5.00 CARE D; Issuer not cooperating;
term Bank Based on the best available
Facilities Information
Detailed Rationale & Key Rating Drivers
CARE had, vide its press release dated January 29, 2019, placed the
ratings of RPPL under the 'issuer non-cooperating' category as RPPL
had failed to provide information for monitoring of the rating.
RPPL continues to be non-cooperative despite repeated requests for
submission of information through e-mails, phone calls and a letter
dated March 30, 2020. In line with the extant SEBI guidelines, CARE
has reviewed the rating on the basis of the best available
information which however, in CARE's opinion is not sufficient to
arrive at a fair rating.
Users of this rating (including investors, lenders and the public
at large) are hence requested to exercise caution while using the
above ratings.
The ratings take into account on-going delays in debt servicing by
RPPL ascertained by CARE as a part of its due diligence exercise.
Detailed description of the key rating drivers
At the time of last rating on January 29, 2019 the following were
the rating strengths and weaknesses (FY18 financials updated for
the information available from ROC):
Key Rating Weaknesses
* Delays in debt servicing: CARE as a part of its due diligence
exercise interacts with various stakeholders of the company
including lenders to the company and as a part of its exercise
ascertained that there are on-going delays in debt servicing
RPPL was incorporated in 1995 in the name of Enmas Engenius
Projects Limited (EEPL). During its initial stages the company was
involved mainly in erection and commissioning of Chemical recovery
boilers. Subsequently in 2008 the name of the company was changed
to Enmas GB Power Systems Projects Limited (EGPL) and the company
started catering to power industry. During FY12, the promoters of
the Chennai-based Bhandari group had indirectly acquired 49.7%
stake from Resurgent Investments Private Limited (RIPL - Promoter
Company).
SAFIRE INDUSTRIES: CRISIL Keeps D Debt Ratings in Not Cooperating
-----------------------------------------------------------------
CRISIL said the ratings on bank facilities of The Safire Industries
(SI; part of the Safire group) continues to be 'CRISIL D/CRISIL D
Issuer Not Cooperating'.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Bank Guarantee 0.5 CRISIL D (ISSUER NOT
COOPERATING)
Cash Credit 3.0 CRISIL D (ISSUER NOT
COOPERATING)
Letter of Credit 1.0 CRISIL D (ISSUER NOT
COOPERATING)
Long Term Loan 4.65 CRISIL D (ISSUER NOT
COOPERATING)
Proposed Working 3.00 CRISIL D (ISSUER NOT
Capital Facility COOPERATING)
CRISIL has been consistently following up with SI 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 SI, which restricts CRISIL's
ability to take a forward looking view on the entity's credit
quality. CRISIL believes information available on SI 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 SI continues to be 'CRISIL D/CRISIL D Issuer Not
Cooperating'.
For arriving at its ratings, CRISIL has combined the business and
financial risk profiles of SI and The Safire Offset Printers (SOP).
This is because the two entities, together referred to as the
Safire group, are in the same line of business, and have a common
management and fungible cash flows.
Set up in 1989 by Mr. Ayyanathan, SI is part of the Safire group,
which prints film posters, brochures, calendars, text books, and
school magazines. Both SI and SOP are based in Sivakasi (Tamil
Nadu).
SAFIRE OFFSET: CRISIL Keeps 'D' Debt Ratings in Not Cooperating
---------------------------------------------------------------
CRISIL said the ratings on bank facilities of The Safire Offset
Printers (SOP; part of the Safire group) continues to be 'CRISIL
D/CRISIL D Issuer Not Cooperating'.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Bank Guarantee 0.5 CRISIL D (ISSUER NOT
COOPERATING)
Cash Credit 8.0 CRISIL D (ISSUER NOT
COOPERATING)
Letter of Credit 1.0 CRISIL D (ISSUER NOT
COOPERATING)
Long Term Loan 6.45 CRISIL D (ISSUER NOT
COOPERATING)
Proposed Working 2.00 CRISIL D (ISSUER NOT
Capital Facility COOPERATING)
CRISIL has been consistently following up with SOP 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 SOP, which restricts CRISIL's
ability to take a forward looking view on the entity's credit
quality. CRISIL believes information available on SOP 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 SOP continues to be 'CRISIL D/CRISIL D Issuer Not
Cooperating'.
For arriving at its ratings, CRISIL has combined the business and
financial risk profiles of The Safire Industries (SI) and The
Safire Offset Printers (SOP). This is because the two entities,
together referred to as the Safire group, are in the same line of
business, and have a common management and fungible cash flows.
Set up in 1989 by Mr. Ayyanathan, SOP is part of the Safire group,
which prints film posters, brochures, calendars, text books, and
school magazines. Both SI and SOP are based in Sivakasi (Tamil
Nadu).
SAHYOG JANKALYAN: CRISIL Cuts Rating on INR4cr Loan to 'B+'
-----------------------------------------------------------
CRISIL has revised the ratings on bank facilities of Sahyog
Jankalyan Samiti (SJS) to 'CRISIL B+/Stable Issuer Not Cooperating'
from 'CRISIL BB+/Stable Issuer Not Cooperating'.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Cash Credit 4 CRISIL B+/Stable (ISSUER NOT
COOPERATING; Revised from
'CRISIL BB+/Stable ISSUER NOT
COOPERATING')
Overdraft 3 CRISIL B+/Stable (ISSUER NOT
COOPERATING; Revised from
'CRISIL BB+/Stable ISSUER NOT
COOPERATING')
Term Loan 69 CRISIL B+/Stable (ISSUER NOT
COOPERATING; Revised from
'CRISIL BB+/Stable ISSUER NOT
COOPERATING')
CRISIL has been consistently following up with SJS for obtaining
information through letters and emails dated November 30, 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 SJS, which restricts CRISIL's
ability to take a forward looking view on the entity's credit
quality. CRISIL believes information available on SJS 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 SJS Revised to 'CRISIL B+/Stable Issuer Not
Cooperating' from 'CRISIL BB+/Stable Issuer Not Cooperating'.
SJS, established by Mr Pranveer Singh and Mr Nirpendra Singh in
2001, operates two educational institutions, Pranveer Singh
Institute of Technology and Pranveer Singh Academy of Technology,
in Kanpur, Uttar Pradesh. Both the institutes are affiliated to
GBTU. They offer courses in engineering, management, and computer
applications.
SARA SPINTEX: CARE Keeps 'D' Debt Ratings in Not Cooperating
------------------------------------------------------------
CARE Ratings said the rating for the bank facilities of Sara
Spintex India Private Limited (SSIPL) continues to remain in the
'Issuer Not Cooperating' category.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long term Bank 36.36 CARE D; Issuer Not Cooperating;
Facilities Based on best available
Information
Short term Bank 2.00 CARE D; Issuer Not Cooperating;
Facilities Based on best available
Information
Detailed Rationale & Key Rating Drivers
CARE had, vide its press release dated January 18, 2019, placed the
rating of SSIPL under the 'issuer non-cooperating' category as
SSIPL had failed to provide information for monitoring of the
rating as agreed to in its Rating Agreement. SSIPL continues to be
non-cooperative despite repeated requests for submission of
information through numerous phone calls and email dated April 15,
2020, May 4, 2020, May 5, 2020. In line with the extant SEBI
guidelines, CARE has reviewed the rating on the basis of the best
available information which however, in CARE's opinion is not
sufficient to arrive at a fair rating.
Users of this rating (including investors, lenders and the public
at large) are hence requested to exercise caution while using the
above ratings.
Detailed description of the key rating drivers
At the time of last rating on January 18, 2019 following were the
rating weaknesses (Updated for the information available from
Registrar of companies)
Key Rating Weakness
* Delay in debt servicing obligations: There have been continuous
delays in debt servicing obligations. The delays were on account
of weak liquidity position.
SSPL was incorporated in the year March 2011; however, commenced
with the commercial production from April 2013. The company is
engaged in business of manufacturing of cotton yarn of various
types like ring spurn yarns, slub yarn and core spun yarn.
SEVENHILLS HEALTHCARE: CRISIL Keeps 'D' Debt Ratings in Not Coop.
-----------------------------------------------------------------
CRISIL said the ratings on bank facilities of SevenHills Healthcare
Private Limited (SHPL) continues to be 'CRISIL D Issuer Not
Cooperating'.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Funded Interest 56.44 CRISIL D (ISSUER NOT
Term Loan COOPERATING)
Overdraft 50 CRISIL D (ISSUER NOT
COOPERATING)
Proposed Long Term 106.81 CRISIL D (ISSUER NOT
Bank Loan Facility COOPERATING)
Term Loan 510.11 CRISIL D (ISSUER NOT
COOPERATING)
CRISIL has been consistently following up with SHPL 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 SHPL, which restricts CRISIL's
ability to take a forward looking view on the entity's credit
quality. CRISIL believes information available on SHPL 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 SHPL continues to be 'CRISIL D Issuer Not
Cooperating'.
SHPL, incorporated in 2004, is currently operating two
super-speciality hospitals under the name of Sevenhills Hospital;
one is in in Visakhapatnam (Andhra Pradesh) and other in Andheri,
Mumbai. Sevenhills Hospital, Visakhapatnam was started in 1988 by
Sevenhills Hospitals Pvt Ltd, which was later merged with SHPL in
2009. Sevenhills Hospital, Mumbai, commenced operations in 2009.
SHPL is currently promoted by Dr. Jitendra Das Maganti, his wife,
Dr. Renuka Jitendra Maganti, and AIRRO (Mauritius) Holdings I,
Mauritius (AIRRO; a fund affiliated to JP Morgan).
SHAKTI MURUGAN: CRISIL Lowers Rating on INR12cr Loan to 'B+'
------------------------------------------------------------
CRISIL has revised the ratings on bank facilities of Shakti Murugan
Industries (SMI) to 'CRISIL B+/Stable Issuer Not Cooperating' from
'CRISIL BB-/Stable Issuer Not Cooperating'.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Cash Credit 12 CRISIL B+/Stable (ISSUER NOT
COOPERATING; Revised from
'CRISIL BB-/Stable ISSUER NOT
COOPERATING')
CRISIL has been consistently following up with SMI 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 SMI, which restricts CRISIL's
ability to take a forward looking view on the entity's credit
quality. CRISIL believes information available on SMI 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 SMI Revised to 'CRISIL B+/Stable Issuer Not
Cooperating' from 'CRISIL BB-/Stable Issuer Not Cooperating'.
Incorporated in 2009, by Mr. Batchu Veeralingam family, SMI is
engaged in cotton ginning and pressing to make cotton bales. It has
a manufacturing capacity of 300 cotton bales per day. The firm has
its manufacturing unit in Karimnagar, Telangana.
SHIVNATH AUTOMOBILES: CRISIL Cuts Rating on INR10cr Loan to 'B+'
----------------------------------------------------------------
CRISIL has revised the ratings on bank facilities of Shivnath
Automobiles Private Limited (SAPL) 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')
Long Term Loan 7.5 CRISIL B+/Stable (ISSUER NOT
COOPERATING; Revised from
'CRISIL BB/Stable ISSUER NOT
COOPERATING')
Proposed Long Term 7.5 CRISIL B+/Stable (ISSUER NOT
Bank Loan Facility COOPERATING; Revised from
'CRISIL BB/Stable ISSUER NOT
COOPERATING')
CRISIL has been consistently following up with SAPL for obtaining
information through letters and emails dated November 30, 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 SAPL, which restricts CRISIL's
ability to take a forward looking view on the entity's credit
quality. CRISIL believes information available on SAPL 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 SAPL Revised to 'CRISIL B+/Stable Issuer Not
Cooperating' from 'CRISIL BB/Stable Issuer Not Cooperating'.
SAPL, incorporated in July 2011, operates a dealership for
passenger and commercial vehicles manufactured by M&M. The company
has exclusive sales rights in six districts of Chhattisgarh, and is
promoted by Mr. Shyam Kishore Gupta and his family members.
SHRIYA OVERSEAS: CARE Keeps 'D' Debt Ratings in Not Cooperating
---------------------------------------------------------------
CARE Ratings said the rating for the bank facilities of Shriya
Overseas Private Limited (SOPL) continues to remain in the 'Issuer
Not Cooperating' category.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long-term Bank 10.00 CARE D; Issuer not cooperating;
Facilities Based on the best available
Information
Short term bank 12.50 CARE D; Issuer not cooperating;
facilities Based on the best available
Information
Detailed Rationale & Key Rating Drivers
CARE had, vide its press release dated March 22, 2019, placed the
ratings of SOPL under the 'issuer non-cooperating' category as SOPL
had failed to provide information for monitoring of the rating.
SOPL continues to be non-cooperative despite repeated requests for
submission of information through e-mails, phone and calls. In line
with the extant SEBI guidelines, CARE has reviewed the rating on
the basis of the best available information which however, in
CARE's opinion is not sufficient to arrive at a fair rating.
Users of this rating (including investors, lenders and the public
at large) are hence requested to exercise caution while using the
above rating.
Detailed description of the key rating drivers
At the time of last rating on March 22, 2019, following were the
rating strengths and weaknesses.
Key Rating Weakness
* Irregularity in debt servicing: There are on-going delays in
servicing of the debt obligations by the SOPL as per verbal
communication by the banker.
Shriya Overseas Private Limited (SOPL) was incorporated in May 1991
by Mr. P. K. Jain and Mr. Bhagat Ram Goyal having its registered
office in Delhi. In 1997, there was a change in promoters with Late
Mr. Rajan Mehra and his family taking over the management of the
company. SOPL had started dealership of General Motors India
Private Limited (GM) for their 'Chevrolet' brand of cars in October
2003. However, in May, 2017 General Motors decided to close its
operations in India.
Subsequently, SOPL under its subsidiary i.e. Triumph Motors Pvt.
Ltd has been awarded dealership of Hyundai Motor India Ltd. for
Udaipur in August, 2017. Further, SOPL was awarded dealership of
Renault India Pvt. Ltd., under which the company operates three 3S
outlets out of which two are at Jaipur, one at Dausa, and further
operates 1S(Showrooms) outlets at Dholpur and Bharatpur each. SOPL
was also awarded for the dealership of Suzuki Motorcycle India
Private limited for Jaipur, Dausa, Kota, Chaksu, and Chomu. The
promoters also have other companies namely, Nirmal Cars India
Private Limited through which they had dealership of Renault India
Private Limited for the selected regions of Rajasthan and Khushi
Cars Private Limited (KCPL) through which they operate a showroom
of high-end Isuzu brand vehicles.
SIDHI VINAYAK: CARE Keeps 'D' Debt Ratings in Not Cooperating
-------------------------------------------------------------
CARE Ratings said the rating for the bank facilities of Sidhi
Vinayak Rice Mills (SVRM) continues to remain in the 'Issuer Not
Cooperating' category.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long term Bank 4.14 CARE D; Issuer Not Cooperating;
Facilities Based on best available
Information
Short term Bank 18.00 CARE D; Issuer Not Cooperating;
Facilities Based on best available
Information
Detailed Rationale & Key Rating Drivers
CARE had, vide its press release dated November 27, 2017, placed
the rating(s) of SVRM under the 'issuer non-cooperating' category
as Sidhi Vinayak Rice Mills had failed to provide information for
monitoring of the rating. Sidhi Vinayak Rice Mills continues to be
non-cooperative despite repeated requests for submission of
information through e-mails, phone calls and a letter/email dated
April 10, 2020 and April 7, 2020. In line with the extant SEBI
guidelines, CARE has reviewed the rating on the basis of the best
available information which however, in CARE's opinion is not
sufficient to arrive at a fair rating.
Users of this rating (including investors, lenders and the public
at large) are hence requested to exercise caution while using the
above rating(s).
The ratings have been reaffirmed by taking into account
non-availability of requisite information and no due-diligence
conducted due to non-cooperation by Sidhi Vinayak Rice Mills with
CARE'S efforts to undertake a review of the rating outstanding.
CARE views information availability risk as a key factor in its
assessment of credit risk.
Detailed description of the key rating drivers
At the time of last rating on February 8, 2019, the following were
the rating weaknesses:
The ratings take into account the ongoing delays in debt servicing
obligations due to stressed liquidity position.
Karnal-based (Haryana) SVRM established in July 2008, as a
partnership firm by Mr. Rameshwar Das, Mr. Ashok Kumar, Mr. Suresh
Kumar and Mr. Amit Kumar sharing profit and losses equally. The
firm started its commercial operations in February 2009. The firm
is engaged in milling and processing and trading of basmati rice.
The firm procures paddy from Haryana and Uttar Pradesh and sells
domestically in states like Uttar Pradesh, Haryana and Delhi. It
also exports its product to Saudi Arabia, Iran, Yemman.
SNEHA VINYL: CRISIL Lowers Rating on INR8.5cr LT Loan to B+
-----------------------------------------------------------
CRISIL said the ratings on bank facilities of Sneha Vinyl Products
Private Limited (SVPPL) was revised to 'CRISIL B+/Stable Issuer Not
Cooperating' from 'CRISIL BB-/Stable Issuer Not Cooperating'.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Cash Credit 6.5 CRISIL B+/Stable (ISSUER NOT
COOPERATING; Revised from
'CRISIL BB-/Stable ISSUER NOT
COOPERATING')
Long Term Loan 8.5 CRISIL B+/Stable (ISSUER NOT
COOPERATING; Revised from
'CRISIL BB-/Stable ISSUER NOT
COOPERATING')
Proposed Term Loan 0.5 CRISIL B+/Stable (ISSUER NOT
COOPERATING; Revised from
'CRISIL BB-/Stable ISSUER NOT
COOPERATING')
CRISIL has been consistently following up with SVPPL 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 SVPPL, which restricts CRISIL's
ability to take a forward looking view on the entity's credit
quality. CRISIL believes information available on SVPPL 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 SVPPL Revised to 'CRISIL B+/Stable Issuer Not
Cooperating' from 'CRISIL BB-/Stable Issuer Not Cooperating'.
Established in 1984 by Mr. J.V.V Durga Prasad, SVPPL is a
Manufacturer and Supplier of a perfect range of Coated Fabric (PVC
Leather) and PVC Coated Fabrics. These products are available in
different colors, designs and prints to meet the various
requirements of numerous industries like shoe, chair, garment,
safety product, luggage bag and purse manufacturing industry.
SR FOILS: CRISIL Keeps 'D' Debt Ratings in Not Cooperating
----------------------------------------------------------
CRISIL said the ratings on bank facilities of SR Foils and Tissue
Limited (SRFTL) continues to be 'CRISIL D/CRISIL D Issuer Not
Cooperating'.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Cash Credit 155 CRISIL D (ISSUER NOT
COOPERATING)
Letter of Credit 120 CRISIL D (ISSUER NOT
COOPERATING)
Term Loan 76 CRISIL D (ISSUER NOT
COOPERATING)
CRISIL has been consistently following up with SRFTL 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 SRFTL, which restricts CRISIL's
ability to take a forward looking view on the entity's credit
quality. CRISIL believes information available on SRFTL 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 SRFTL continues to be 'CRISIL D/CRISIL D Issuer Not
Cooperating'.
Incorporated in 1993, SRFTL (formerly SR Foils Ltd) manufactures
aluminium foils (under the Homefoil brand), cling film rolls (Clean
Wrap), and tissue paper products (Mistique). The company has two
manufacturing units, one in Bhiwadi and another in Sotanala, both
in Rajasthan.
SRI PRASANNA METALS: CRISIL Lowers Rating on INR7.5cr Loan to 'D'
-----------------------------------------------------------------
CRISIL has downgraded its rating on the bank facilities of Sri
Prasanna Metals and Alloys (SPMA) to 'CRISIL D/CRISIL D' from
'CRISIL B-/Stable/CRISIL A4'. The downgrade reflects delays by the
company in servicing its debt obligations on account of liquidity
issues.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Cash Credit 7.5 CRISIL D (Downgraded from
'CRISIL B-/Stable')
Letter of Credit 1.5 CRISIL D (Downgraded from
'CRISIL B-/Stable')
The ratings reflect below average financial risk profile, working
capital intensive operations. These rating weakness are partially
offset by Extensive experience of SPMA's partners in the steel
fabrication industry.
Key Rating Drivers & Detailed Description
Weaknesses
* Below-average financial risk profile: SPMA's financial risk
profile is below-average, marked by leveraged capital structure and
weak debt protection metrics. The net worth as on March 31, 2019 is
INR4.15 Cr. The NCATD and Interest coverage for 2018-19 are 0.04
time and 1.39 time respectively.
* Working capital intensive operations: SPMA's operations are
working-capital-intensive, as reflected in gross current assets
estimated at around 269 days as on March 31, 2019. The firm's large
working capital requirement is predominantly to fund its inventory
purchases. In addition to this, it has to offer a credit period of
60 to 75 days to its customers.
Strength
* Extensive experience of SPMA's partners in the steel fabrication
industry: SPMA's partners have prior work experience in the
engineering industry and have been in the fabrication industry for
nearly a decade through SPMA. Due to their long-standing presence
in the industry, the partners have established healthy
relationships with some of its key customers such as FLSmidth Pvt
Ltd and Greenesol Power Systems Pvt Ltd. This has helped the firm
obtain repeat orders from its customers and clock healthy growth in
revenues.
Liquidity Poor
Liquidity is weak on account of high bank limit utilization and
stretch in working capital management. Bank limits were highly
utilized at above 99% till May 2019.
Rating Sensitivity factors
Upward factors
* Timely servicing of debt obligation for at least 3 months.
* Improvement in overall working capital management with Gross
Current Asset days of less than 200.
SPMA, set up in 2004, is involved in fabrication of structural
steel components used in cement factories and sugar mills. Its
manufacturing facility is in Vellore (Tamil Nadu). It is promoted
by three partners - N Muruganandam, R Manivannan and PS Veeramani.
SRI VIJAYA DURGA: CRISIL Keeps 'D' Debt Ratings in Not Cooperating
------------------------------------------------------------------
CRISIL said the ratings on bank facilities of Sri Vijaya Durga
Motors Private Limited (SVDMPL) continues to be 'CRISIL D Issuer
Not Cooperating'.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Cash Credit 8 CRISIL D (ISSUER NOT
COOPERATING)
Proposed Long Term 2 CRISIL D (ISSUER NOT
Bank Loan Facility COOPERATING)
Term Loan 1 CRISIL D (ISSUER NOT
COOPERATING)
CRISIL has been consistently following up with SVDMPL 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 SVDMPL, which restricts CRISIL's
ability to take a forward looking view on the entity's credit
quality. CRISIL believes information available on SVDMPL 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 SVDMPL continues to be 'CRISIL D Issuer Not
Cooperating'.
SVDMPL, incorporated in 2003, remained non-operational until April
2011. During fiscal 2012, the company commenced operations by
taking up the dealership for Mahindra Navistar's commercial
vehicles. It has three showrooms, one each at Kadapa, Kurnool, and
Anantpur, all in Andhra Pradesh.
SUGAVANESWARA SPINNING: CRISIL Keeps D Debt Ratings in Not Coop.
----------------------------------------------------------------
CRISIL said the ratings on bank facilities of Sugavaneswara
Spinning Mills Private Limited (SSMPL) continues to be 'CRISIL D
Issuer Not Cooperating'.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Cash Credit 6 CRISIL D (ISSUER NOT
COOPERATING)
Long Term Bank
Facility 1.05 CRISIL D (ISSUER NOT
COOPERATING)
Long Term Loan 6.5 CRISIL D (ISSUER NOT
COOPERATING)
Working Capital
Term Loan 1.25 CRISIL D (ISSUER NOT
COOPERATING)
CRISIL has been consistently following up with SSMPL 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 SSMPL, which restricts CRISIL's
ability to take a forward looking view on the entity's credit
quality. CRISIL believes information available on SSMPL 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 SSMPL continues to be 'CRISIL D Issuer Not
Cooperating'.
Managed by Mr. T.Sundaravel, SSMPL started operations in 1981 in
Salem (Tamil Nadu). It manufactures cotton yarn in counts ranging
from 30s to 80s.
SWASTIK LLOYDS: CRISIL Keeps 'D' Debt Ratings in Not Cooperating
----------------------------------------------------------------
CRISIL said the ratings on bank facilities of Swastik Lloyds
Engineering Private Limited (SLEPL) continues to be 'CRISIL
D/CRISIL D Issuer Not Cooperating'.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Bank Guarantee 4 CRISIL D (ISSUER NOT
COOPERATING)
Cash Credit 4 CRISIL D (ISSUER NOT
COOPERATING)
Proposed Long Term 4 CRISIL D (ISSUER NOT
Bank Loan Facility COOPERATING)
CRISIL has been consistently following up with SLEPL 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 SLEPL, which restricts CRISIL's
ability to take a forward looking view on the entity's credit
quality. CRISIL believes information available on SLEPL 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 SLEPL continues to be 'CRISIL D/CRISIL D Issuer Not
Cooperating'.
SLEPL was incorporated in 1997, promoted by Mr Mafatlal Sanghvi and
his family. The company manufactures and supplies pipe fittings
such as elbows, bends, tees, stub ends, reducers, and caps; it also
executes turnkey projects for mechanical piping. Its manufacturing
facility is in Taloja, Maharashtra, with an installed capacity of
100 tonne per month.
THERMO PRODUCTS: CARE Keeps 'D' Debt Ratings in Not Cooperating
---------------------------------------------------------------
CARE Ratings said the rating for the bank facilities of Thermo
Products Private Limited (TPPL) continues to remain in the 'Issuer
Not Cooperating' category.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long term Bank 5.33 CARE D; Issuer Not Cooperating;
Facilities Based on best available
Information
Short term Bank 0.50 CARE D; Issuer Not Cooperating;
Facilities Based on best available
Information
Detailed Rationale & Key Rating Drivers
CARE had, vide its press release dated January 18, 2019, placed the
rating of TPPL under the 'issuer non-cooperating' category as TPPL
had failed to provide information for monitoring of the rating as
agreed to in its Rating Agreement. TPPL continues to be
non-cooperative despite repeated requests for submission of
information through repetitive phone calls, numerous email dated
April 15, 2020, April 27, 2020 and May 4, 2020. In line with the
extant SEBI guidelines, CARE has reviewed the rating on the basis
of the best available information which however, in CARE's opinion
is not sufficient to arrive at a fair rating.
Users of this rating (including investors, lenders and the public
at large) are hence requested to exercise caution while using the
above ratings.
Detailed description of the key rating drivers
At the time of last rating on January 18, 2019, following were the
rating weaknesses (Updated for the information available from
Registrar of companies)
Key Rating Weakness
* Delay in debt servicing obligations: As per the interaction with
the banker during last review, there were ongoing delays in
repayment of principal and interest portion of term loan. Timely
repayment of debt is the key rating sensitivity.
Pune (Maharashtra) based TPPL, incorporated in 2004 is promoted by
Mr. Mukesh Agarwal and Mr. Omprakash Agarwal. The company is
engaged in the manufacturing of packaging material viz. EPS
(Expanded Polystyrene or Styrofoam popularly known as thermocol)
buffers at its manufacturing facility located at Sanaswadi, Pune
with an installed capacity of 3000 metric tonne per annum. EPS
buffers, manufactured by TPPL find application in the packaging of
consumer durable goods. TPPL is a part of the Prakash group of
companies which is engaged in the manufacturing of packaging
material for more than three decades through other group companies
"Prakash Corrugated Pune Private Limited" and "Shree Bhagwan Tubes
& Containers Private Limited".
TMR DEVELOPERS: CRISIL Keeps D INR18cr Loan Rating in Not Coop.
---------------------------------------------------------------
CRISIL said the ratings on bank facilities of TMR Developers
Private Limited (TMR) continues to be 'CRISIL D Issuer Not
Cooperating'.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Term Loan 18 CRISIL D (ISSUER NOT COOPERATING)
CRISIL has been consistently following up with TMR 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 TMR, which restricts CRISIL's
ability to take a forward looking view on the entity's credit
quality. CRISIL believes information available on TMR 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 TMR continues to be 'CRISIL D Issuer Not
Cooperating'.
Established in August 2012, TMR is engaged in residential real
estate construction business in Bangalore, Karnataka. The company
has two on-going projects under the name 'Tulips Blossoms and
Tulips Orchids. The company is promoted by Mr.T.Madhava Rao and
Ms.T.V.Venkata Sirisha who are the directors. The day to day
operations are managed by Mr. T.Madhava Rao.
UNNAT AGRO: CARE Lowers Rating on INR20.11cr LT Loan to B-
----------------------------------------------------------
CARE Ratings revised the ratings on certain bank facilities of
Unnat Agro Industries (UAI), as:
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long term Bank 20.11 CARE B-; Stable; Issuer not
Facilities cooperating; Revised from
CARE B; Stable; Issuer not
Cooperating on the basis of
best available information
Detailed Rationale & Key Rating Drivers
CARE had, vide its press release dated March 29, 2019, placed the
rating of UAI under the 'issuer noncooperating' category as Unnat
Agro Industries had failed to provide information for monitoring of
the rating. Unnat Agro Industries continues to be non-cooperative
despite repeated requests for submission of information through
e-mails, phone calls and a letter/email dated May 6, 2020, May 5,
2020, and May 4, 2020. In line with the extant SEBI guidelines,
CARE has reviewed the rating on the basis of the best available
information which however, in CARE's opinion is not sufficient to
arrive at a fair rating.
Users of this rating (including investors, lenders and the public
at large) are hence requested to exercise caution while using the
above rating(s).
Detailed description of the key rating drivers
The long term rating has been revised on account of high degree of
competition resulting from fragmented nature of the edible oil
industry, and partnership nature of its constitution.
* High degree of competition resulting from fragmented nature of
the edible oil industry: Low barriers to entry has resulted in
highly fragmented nature of the edible oil industry. Furthermore,
most of the players offer similar products with little difference
which competes with each other resulting in lower margins for most
of the players. Furthermore, despite having better health benefits
and priced much less than any other edible oils, rice bran oil
industry faces tough competition because of the presence of a
number of close substitute products in market. Olive oil, copra,
and palm oil are slotted as main substitute of rice bran oil and
they have a variety of products under their category for which they
poses serious threat to the profit margin of the players operating
in rice bran oil segment.
* Being an agri-based commodity, the prospects are subject to
vagaries of nature: Rice bran, the major input for rice bran oil
is obtained from paddy, an agri produce. Given the lack of adequate
irrigation facilities, the cultivated amount of paddy highly
depends upon monsoons and thus, is subjected to the vagaries of
nature. As a result, raw material availability is uncertain.
* Partnership nature of its constitution: UAI's constitution as a
partnership firm has the inherent risk of possibility of withdrawal
of the partners' capital at the time of personal contingency and
firm being dissolved upon the death/retirement/insolvency of
partners.
Unnat Agro Industries (UAI) was established in 2016 as a
partnership firm and is currently being managed by Mr. Jaininder
Kumar, Mr. Chandan Kumar, Mr. Nawal Kishore and Mr. Sanjeev Kumar
as its partners sharing profit and loss equally. The firm is
established with an aim to set up a manufacturing facility for
extraction of rice bran oil at Fatehgarh Sahib, Punjab. The
proposed installed capacity at its manufacturing facility will be
of 75,000 metric tonne of rice bran oil per annum (MTPA). The
project pertaining to this got completed in January, 2018 however,
operations have not yet commenced as the firm is yet to acquire few
approvals. The commercial operations are expected to commence from
April, 2018. Presently, the firm is engaged in trading of rice bran
oil which commenced from Nov. 10, 2016.
=================
I N D O N E S I A
=================
NISSAN MOTOR: Formally Closes Indonesian Factory
------------------------------------------------
The Jakarta Post reports that Nissan Motor Indonesia (NMI)
announced the official closure of its factory in Indonesia as its
Japanese parent company disclosed a restructuring plan to improve
its finances.
Japan's Nissan Motor Co. stated on May 28 that the company was
taking robust action to improve efficiency, which included the
closure of its manufacturing facility in Indonesia. It also closed
its Barcelona plant, the Spanish government confirmed.
According to The Jakarta Post, NMI's spokesperson Hana Maharani
said Nissan Motor Co.'s announcement formalizes the closure of
NMI's factory in Purwakarta, West Java, which had stopped
activities in March.
"We have stopped our production line back in March. Therefore, the
next step taken is to close the facility," she said in a text
message to The Jakarta Post on May 28, adding that the announcement
only served as a "formality."
As Japan's Nissan factory in Indonesia is facing closure, the
company is concentrating on its plant in Thailand as the single
production base in ASEAN, its statement reads.
The Jakarta Post relates that Nissan Motor Co. said in April that
it expected an annual operating loss of up to JPY45 billion (US$417
million), its worst performance since the 2008-2009 financial
crisis.
The decision to stop its operations in Purwakarta was part of the
company's optimization plan, which includes "rightsizing" and
reorganizing its business operations, NMI president director Isao
Sekiguchi said in a statement earlier in March, as quoted by
Tempo.co., relays The Jakarta Post.
NMI had opened its Purwakarta factory, which assembles several
models, including the Nissan March, X-Trail and Serena, in 2014. It
also produced models for the Datsun brand, namely Datsun Go Panca
and Datsun GO+ Panca.
About Nissan Motor
Nissan Motor Company Ltd, usually shortened to Nissan, is a
Japanese multinational automobile manufacturer headquartered in
Nishi-ku, Yokohama, Japan.
As reported in the Troubled Company Reporter-Asia Pacific on April
21, 2020, Egan-Jones Ratings Company, on April 6, 2020, downgraded
the foreign currency and local currency senior unsecured ratings on
debt issued by Nissan Motor Co., Ltd. to BB from BBB.
WASKITA BETON: Fitch Cuts LT Rating to 'BB(idn)', Outlook Neg.
--------------------------------------------------------------
Fitch Ratings Indonesia has downgraded precast concrete
manufacturer PT Waskita Beton Precast Tbk's (WSBP) National
Long-Term Rating to 'BB(idn)', from 'BBB-(idn)', with a Negative
Outlook. At the same time, Fitch has downgraded WSBP's IDR2
trillion unsecured bond programme and the bonds issued under the
programme to 'BB(idn)', from 'BBB-(idn)'.
The downgrade and the Negative Outlook follow similar rating action
on parent, PT Waskita Karya (Persero) Tbk (WSKT,
BBB+(idn)/Negative), after Fitch lowered the parent's Standalone
Credit Profile (SCP) to 'bb(idn)', from 'bbb-(idn)', on a weakening
financial profile. Fitch rates WSBP - which Fitch believes has a
stronger credit profile than the parent, as evidenced by its SCP of
'bbb-(idn)' - based on WSKT's SCP due to moderate ties between to
two entities.
'BB' National Ratings denote an elevated default risk relative to
other issuers or obligations in the same country or monetary
union.
KEY RATING DRIVERS
Parent's Weakening SCP; Stronger Subsidiary: WSBP's rating is based
on its parent's SCP, which Fitch revised to 'bb(idn)' on 29 May
2020 on account of weaker credit metrics and increasing liquidity
pressure. Fitch believes WSBP has a stronger profile, with an SCP
of 'bbb-(idn)', and accordingly, follow the 'Stronger Subsidiary'
path under its Parent and Subsidiary Rating Linkage criteria. Fitch
assesses legal and operating ties to be moderate due to senior
management overlap and influence over WSBP's investments, strategy
and operation, and therefore base WSBP's rating on WSKT's SCP.
Pandemic-Related Contract, Project Delays: Fitch believes the
coronavirus pandemic will lead to fewer new contract tenders, delay
project completions and extend customer payments due to
restrictions imposed by large-scale social-distancing measures.
Fitch forecasts new contract wins to drop by around 10% in 2020 to
IDR6.3 trillion (2019: IDR7.0 trillion) as project owners delay
tender processes. Precast production at full capacity will also be
challenging, assuming that social-distancing measures will remain
in place throughout 2Q20, as WSBP will have to reduce its
production workforce.
This will translate into higher working-capital requirements in
2020 that pressure WSBP's cash flow from operation - necessitating
higher debt to cover the cash flow mismatch. Nonetheless, Fitch
believes that WSBP has some room to cut annual capex to around
IDR200 billion in 2020 and 2021 (2019: IDR926 billion) to alleviate
cash flow pressure.
Rising Leverage: Fitch has revised its assessment of WSBP's SCP to
'bbb-(idn)', from 'bbb(idn)', on account of higher leverage, as
Fitch expects net debt/EBITDA to remain above 4.0x until 2021.
Fitch expects free cash flow to remain negative for the next two
years due to a longer working capital cycle and under the
assumption of IDR200 billion in annual capex. Total debt increased
to IDR6 trillion in 2019, from IDR4.9 trillion in 2017, closing the
free cash flow deficit. Nonetheless, WSBP's EBITDA/interest
coverage should remain adequate at above 2.0x.
Increasing Contract Diversification, Margin Pressure: WSBP has
lowered reliance on contracts from WSKT; it had derived 51% of
revenue from WSKT and subsidiaries in 2019, compared with 80% in
2018. However, such diversification also leads to a lower EBITDA
margin, as private projects are generally more competitive and have
higher costs. WSBP's EBITDA margin declined to 21% in 2019, from
around 25% in 2018, as its revenue portion shifted away from WSKT.
DERIVATION SUMMARY
WSBP's SCP is well-positioned compared with PT Aneka Gas Industri
Tbk (A-(idn)/Stable). WSBP has larger scale in terms of EBITDA and
lower leverage. However, this is outweighed by Aneka Gas's higher
and stable margin due to long-term contracts with a satisfactory
cost pass-through mechanism. Aneka Gas is also a leader in a market
that has high entry barriers, while WSBP competes in a competitive
industry with low entry barriers, which is reflected in its weaker
profitability. Hence, WSBP is rated three notches below Aneka Gas.
WSBP's SCP is three notches higher than that of palm-oil producer,
PT Sawit Sumbermas Sarana Tbk (BB-(idn)/Stable). This reflects
WSBP's lower leverage and coverage, whereby SSMS recorded net
debt/EBITDA above 10x and EBITDA/interest below 1.0x in 2019. WSBP
also has better funding access, with various working-capital
facilities from both domestic and foreign banks.
KEY ASSUMPTIONS
Fitch's Key Assumptions Within its Rating Case for the Issuer
- New contracts to drop by 10% in 2020 due to project tender
delays
- Lower average burn rate in 2020 due to project completion
delays
- Longer working-capital cycle in 2020 due to delayed payments
from project owners, as project completion and delivery are also
delayed
- IDR200 billion of capex in 2020 and 2021
RATING SENSITIVITIES
Factors that could, individually or collectively, lead to positive
rating action/upgrade:
- An upward revision of WSKT's SCP
- Higher proportion of revenue and new contracts from external
parties
Factors that could, individually or collectively, lead to negative
rating action/downgrade:
- A downward revision of WSKT's SCP or a downgrade of its rating
BEST/WORST CASE RATING SCENARIO
International scale credit ratings of Non-Financial Corporate
issuers have a best-case rating upgrade scenario (defined as the
99th percentile of rating transitions, measured in a positive
direction) of three notches over a three-year rating horizon; and a
worst-case rating downgrade scenario (defined as the 99th
percentile of rating transitions, measured in a negative direction)
of four notches over three years. The complete span of best- and
worst-case scenario credit ratings for all rating categories ranges
from 'AAA' to 'D'. Best- and worst-case scenario credit ratings are
based on historical performance.
LIQUIDITY AND DEBT STRUCTURE
Adequate Funding Access, Concentrated Maturity: WSBP had IDR469
billion in cash against IDR4 trillion of short-term working-capital
facilities at end-2019. Liquidity pressure in 2020 is alleviated by
the presence of working-capital loans in its debt structure. More
than IDR4 trillion (66% of outstanding debt) in 2019 comprised
working-capital loans from various banks, which can be rolled over.
The remainder of debt comprised bonds of IDR2 trillion that will
mature in 2022.
REFERENCES FOR SUBSTANTIALLY MATERIAL SOURCE CITED AS KEY DRIVER OF
RATING
The principal sources of information used in the analysis are
described in the Applicable Criteria.
PUBLIC RATINGS WITH CREDIT LINKAGE TO OTHER RATINGS
The rating of WSBP is directly linked to the rating of its parent,
WSKT. A change in Fitch's assessment of the rating of WSKT would
automatically result in a change in the rating on WSBP and its
notes.
===============
M O N G O L I A
===============
MONGOLIA: Fitch Affirms LT IDR at 'B', Outlook Stable
-----------------------------------------------------
Fitch Ratings has affirmed Mongolia's Long-Term Foreign-Currency
Issuer Default Rating at 'B'. The Outlook is Stable.
KEY RATING DRIVERS
Mongolia's commodity-dependent economy is facing a sharp slowdown
in GDP and export growth, deterioration in the public finances and
an erosion in external buffers this year due to the coronavirus
shock. Nevertheless, the affirmation of the rating with a Stable
Outlook reflects Fitch's assessment that the impact of the shock
will be largely temporary, with the economy rebounding strongly and
government debt/GDP starting to decline again in 2021. Significant
downside risks are captured at the 'B' rating level, and Mongolia's
strong structural factors combined with expected access to
financing from multilateral and bilateral creditors provide support
to the sovereign ratings.
Fitch forecasts the economy to contract by 2% in 2020, before
rebounding to 7.9% in 2021. Its baseline assumes demand from China,
which accounts for around 90% of Mongolia's exports, will pick up
during the second half of this year. This is underscored by a
gradual improvement in China's industrial production and investment
spending since April. At the same time, downside risks to
Mongolia's growth outlook remain amid uncertainty on how the
pandemic develops globally, as well as the speed of China's
recovery.
Real GDP fell by 10.7% yoy in the first quarter, driven in large
part by measures to prevent the local spread of the coronavirus.
This included a temporary suspension of coal exports to China
during February and March, tight restrictions on international
flights and railways, and strict social-distancing measures.
Mongolia has seen relative success in containing the coronavirus,
with 141 officially reported cases.
Fitch forecasts a budget deficit of 7.1% of GDP in 2020, up from a
1.4% surplus last year. Its forecast is wider than the government's
baseline of 2.5%, due mainly to its view that the revenue decline
will be more severe. In March, the authorities unveiled an economic
stimulus package valued at around 13% of projected 2020 GDP.
However, this includes reordering of expenditure priorities, and
Fitch estimates that measures that will add directly to the budget
deficit are around 4% of GDP. Key fiscal priorities include select
infrastructure projects, as well as fiscal and tax relief measures.
The risk of a sharp rise in pre-election spending ahead of
parliamentary elections on June 24, as was the case in 2016, has
thus far not materialised, and Fitch now anticipates fiscal
restraint to remain broadly intact.
Fitch projects that the fiscal deficit and growth contraction will
drive up the general government gross debt to around 70% of GDP by
end-2020, from 65% of GDP in 2019. Fitch expects GGGD to resume its
downward trend in 2021 and decline to 57% by 2024, below the
current 'B' median level of 60%. Prior to the coronavirus outbreak,
Mongolia had made significant progress in reducing public debt from
93% of GDP in 2016, underpinned by strong budget outcomes aided by
robust growth and supportive commodity prices.
Fitch forecasts foreign-currency reserves (USD4.1 billion in 1Q20)
to decline to USD3.1 billion by end-2020, equivalent to 4.1x
current-external payments. The sovereign faces no marketable
external bond maturities until April 2021, after a USD500 million
private-sector external bond carrying a government guarantee
matured in May 2020. Fitch forecasts the current account deficit to
widen to 14.7% of GDP in 2020 (4.6% of GDP net of FDI, or USD645
million), before narrowing to 11.9% in 2021. Nevertheless, reserves
are low and a rating weakness, particularly in view of a
substantial step up in amortisation in 2021-2023.
IMF staff have completed discussions on a USD99 million loan under
its Rapid Financing Instrument to help meet the country's budgetary
and balance of payments needs, and Fitch expects IMF board approval
in early June. In completing the discussions, IMF staff noted
Mongolia's progress in reducing public debt and accumulating
reserves under the three-year Extended Fund Facility (EFF) that
expired on May 23. The Asian Development Bank (ADB) has also
recently approved new loans and a grant worth USD233 million in
budget support and project financing. The authorities are also
exploring a possible follow-on program to the EFF, as reflected in
the IMF's media statement following staff discussions on the RFI.
The Mongolian parliament unanimously passed a resolution last
November requiring the government to review ways to improve the Oyu
Tolgoi investment agreement. Fitch believes this underscores the
longstanding strained relations between the government and Rio
Tinto over taxation, delays and other aspects of the large-scale
copper mining project, as well as the potential for heightened
political volatility around resource nationalism. However, Fitch
does not believe this will lead to a material disruption in Oyu
Tolgoi's development, given the significant implications this would
have for Mongolia's macroeconomic stability, and the considerable
investment that Rio Tinto has already deployed into the country.
Mongolia's rating is supported by World Bank Governance Indicators,
GDP per capita, and World Bank Doing Business rankings that are
stronger than the 'B' range median. GDP growth potential is high.
However, net external debt is high at 176% of GDP at end-2019.
Fitch has a negative sector outlook on Mongolian banks, which
reflects its expectation that the pandemic will put additional
pressure on banks' asset quality. The banking sector non-performing
loan ratio stood at 10.9% as of end-April 2020. A combination of
the Bank of Mongolia cutting interest rates by 200bp so far in
2020, slower credit growth than previously expected and a higher
credit-loss provision is likely to put pressure on banks'
profitability.
ESG - Governance: Mongolia has an ESG Relevance Score of 5 for both
Political Stability and Rights and for the Rule of Law,
Institutional and Regulatory Quality and Control of Corruption, as
is the case for all sovereigns. Theses scores reflect the high
weight that the WBGIs have in its proprietary Sovereign Rating
Model. Mongolia has a medium WBGIs ranking in the 53th percentile,
reflecting a recent record of peaceful political transitions, a
moderate level of rights for participation in the political
process, moderate institutional capacity, established rule of law
and a moderate level of corruption.
SOVEREIGN RATING MODEL (SRM) AND QUALITATIVE OVERLAY (QO)
Fitch's proprietary SRM assigns Mongolia a score equivalent to a
rating of 'B+' on the Long-Term Foreign-Currency IDR scale.
Fitch's sovereign rating committee adjusted the output from the SRM
to arrive at the final LT FC IDR by applying its QO, relative to
rated peers, as follows:
- External Finances: -1 notch, to reflect high vulnerability to
external shocks, given the country's narrow economic base, which is
exposed to commodity prices and developments in China, moderate
level of foreign-currency reserves, substantial amortisations on
external marketable debt, and high net external debt ratios.
- Structural Features: -1 notch, to reflect uncertainty ahead of
forthcoming parliamentary elections and strained relationships with
major foreign investors, which increases the risk of political and
economic shocks.
- Macroeconomics: +1 notch, to reflect Mongolia's strong
medium-term growth prospects. The committee introduced a new
positive notch because it believes strong medium-term growth
prospects are not reflected in the current SRM output. The SRM
output has fallen by one notch since the last review mainly owing
to the impact of the coronavirus shock on GDP growth, which Fitch
believes will be temporary and which would otherwise add excessive
cyclicality to the rating.
Fitch's SRM is the agency's proprietary multiple regression rating
model that employs 18 variables based on three-year centred
averages, including one year of forecasts, to produce a score
equivalent to a LT FC IDR. Fitch's QO is a forward-looking
qualitative framework designed to allow for adjustment to the SRM
output to assign the final rating, reflecting factors within its
criteria that are not fully quantifiable and/or not fully reflected
in the SRM.
RATING SENSITIVITIES
Factors that could, individually or collectively, lead to positive
rating action/upgrade:
- The accumulation of larger foreign-currency reserve buffers and
the implementation of a debt-management strategy that lowers
refinancing risks and maintains external debt sustainability.
- A reduction of fiscal deficits that puts GGGD/GDP back on a
downward trajectory after the increase in 2020 related to the
coronavirus shock.
- A resumption of stronger economic growth and export trends
without the emergence of imbalances, and the maintenance of a
favourable business environment conducive to robust FDI inflows.
Factors that could, individually or collectively, lead to negative
rating action/downgrade:
- Evidence of heightened external financing stress, for example
if official multilateral and/or bilateral inflows are not
forthcoming or in the event of a marked decline in foreign
reserves.
- Failure to reduce the budget deficit and stabilise the GGGD/GDP
ratio after the increase in 2020 related to the coronavirus shock.
- Political instability sufficient to significantly disrupt
strategic mining projects or FDI inflows.
BEST/WORST CASE RATING SCENARIO
International scale credit ratings of Public Finance issuers have a
best-case rating upgrade scenario (defined as the 99th percentile
of rating transitions, measured in a positive direction) of three
notches over a three-year rating horizon; and a worst-case rating
downgrade scenario (defined as the 99th percentile of rating
transitions, measured in a negative direction) of three notches
over three years. The complete span of best- and worst-case
scenario credit ratings for all rating categories ranges from 'AAA'
to 'D'. Best- and worst-case scenario credit ratings are based on
historical performance.
KEY ASSUMPTIONS
- The global economy performs in line with Fitch's May 26, 2020
global economic outlook, particularly China, which is a key source
of external trade and financing.
REFERENCES FOR SUBSTANTIALLY MATERIAL SOURCE CITED AS KEY DRIVER OF
RATING
The principal sources of information used in the analysis are
described in the Applicable Criteria.
ESG CONSIDERATIONS
Mongolia has an ESG Relevance Score of 5 for Political Stability
and Rights as WBGIs have the highest weight in Fitch's SRM and are
highly relevant to the rating and a key rating driver with a high
weight.
Mongolia has an ESG Relevance Score of 5 for Rule of Law,
Institutional & Regulatory Quality and Control of Corruption as
WBGIs have the highest weight in Fitch's SRM and are therefore
highly relevant to the rating and are a key rating driver with a
high weight.
Mongolia has an ESG Relevance Score of 4 for Human Rights and
Political Freedoms as the Voice and Accountability pillar of the
WBGIs is relevant to the rating and a rating driver.
Mongolia has an ESG Relevance Score of 4 for Creditor Rights as
willingness to service and repay debt is relevant to the rating and
is a rating driver for Mongolia, as for all sovereigns.
Except for the matters discussed, the highest level of ESG credit
relevance, if present, is a score of 3. This means ESG issues are
credit-neutral or have only a minimal credit impact on the
entity(ies), either due to their nature or to the way in which they
are being managed by the entity(ies).
=====================
N E W Z E A L A N D
=====================
GRETHA GROUP: Ski Resort Placed Into Liquidation
------------------------------------------------
John Anthony at Stuff.co.nz reports that a South Island ski resort
has gone into liquidation not long after its director expressed
fears for the survival of his business as a result of Covid-19.
Gretha Group, trading as Methven Resort Hotel, was placed into
liquidation on June 2, Stuff discloses.
Stuff relates that the company, owned by Bruce Wallis and Supalert
Termnuwong, received a NZD116,584 Covid-19 wage subsidy for 19
staff.
The three level, 47-room resort, located less than 30 kilometres
from Mt Hutt ski field, was built in 1985 and sits on a 1.2 hectare
section.
In mid-April, when New Zealand was in Alert Level 4, co-director
Olé Wallis told Stuff there were no bookings for winter and he was
"scared" for the future of his business.
"All the bookings have been cancelled already, before the lockdown
period all our tour groups cancelled," Stuff quotes Mr. Wallis as
saying.
Mr. Wallis said the group had taken over the business just 11
months prior to lockdown.
"All money we spent on marketing [and] building the business up is
mostly now a waste, and we do not know if we can start this all
over again financially," Mr. Wallis said.
The hotel had a 100-seat restaurant, three heated outside spas and
a heated 25 metre swimming pool.
According to Stuff, the business announced its closure on Facebook
on May 27 saying they had closed permanently due to financial
reasons following the "effect of Covid-19".
Liquidators Craig William Melhuish and Christine Johnston were
appointed by shareholders on June 2, Stuff discloses. The first
liquidators report is not due until June 8.
=================
S I N G A P O R E
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CHINA CLUB: To Close, Files for Voluntary Liquidation
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Kai Hsiang Chang and Ranjeetha Pakiam at Bloomberg News report that
Singapore's famous China Club said it will shutter permanently
after 19 years, citing stiff competition in the food and beverage
industry, and escalating labor and operating costs.
"The club has been suffering losses for a few years and will no
longer be able to remain financially viable," Bloomberg quotes
General Manager Andrew Mah as saying in a statement on its website.
"It is with deep regret that we will have to file for voluntary
liquidation and close the club."
Bloomberg says the government last month ordered restaurants to
switch to takeaways or deliveries, and halt on-site dining, under a
national lockdown to curb the spread of the coronavirus.
Inaugurated in May 2001, the China Club offered traditional Chinese
food and personalized services to members from the 52nd floor of a
commercial tower in Singapore's central business district,
according to its website.
SMOVE SINGAPORE: Acres Advisory Appointed as Liquidators
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The Straits Times reports that car-sharing firm Smove is under
liquidation -- the first major player in the vehicle rental market
to go bust in recent years.
Business restructuring specialist Acres Advisory has been appointed
the liquidator, the report discloses.
Smove Singapore Pte Ltd provided car-sharing service in Singapore.
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S U B S C R I P T I O N I N F O R M A T I O N
Troubled Company Reporter-Asia Pacific is a daily newsletter co-
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Marites O. Claro, Joy A. Agravante, Rousel Elaine T. Fernandez,
Julie Anne L. Toledo, Ivy B. Magdadaro and Peter A. Chapman,
Editors.
Copyright 2020. All rights reserved. ISSN: 1520-9482.
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