/raid1/www/Hosts/bankrupt/TCRAP_Public/200626.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
Friday, June 26, 2020, Vol. 23, No. 128
Headlines
A U S T R A L I A
AUSTRALIAN ACADEMY: Second Creditors' Meeting Set for July 2
BRIDGE BUSINESS: Second Creditors' Meeting Set for July 3
OZTOPIA HOLDINGS: Second Creditors' Meeting Set for July 3
QANTAS LTD: To Axe 6,000 Jobs and Raise AUD1.9BB in Fresh Capital
REDZED TRUST 2020-1: S&P Assigns B (sf) Rating to Class F Notes
SUNKEN MONKEY: Second Creditors' Meeting Set for July 3
C H I N A
BEIJING CAPITAL: S&P Affirms BB+ Long-Term ICR, Outlook Negative
CHINA AOYUAN: Fitch Assigns BB- Rating to New USD Sr. Notes
CHINA AOYUAN: S&P Assigns B Rating to New USD Sr. Unsecured Notes
JIANGSU HANRUI: Fitch Withdraws B LT IDRs for Commercial Reasons
[*] State Auditor Warns of Hidden Bad Loan Risks for Small Banks
I N D I A
ABAG HI-TECH: Insolvency Resolution Process Case Summary
AJIT AGRO: CARE Cuts Rating on INR7.0cr LT Loan to B-, Not Coop.
ANMOL ASSOCIATES: Ind-Ra Moves BB Issuer Rating to Non-Cooperating
ARPEE ENERGY: CARE Cuts Rating on INR7cr LT Loan to B, Not Coop.
BALAJI MOBITECH: CARE Keeps D Debt Ratings in Not Cooperating
BANMORE FOAM: CARE Cuts Rating on INR5.92cr Loan to B-, Not Coop.
BARATH BUILDING: Ind-Ra Lowers Long Term Issuer Rating to BB+
BHANDARI AGROFEEDS: CARE Cuts INR11.50cr Loan Rating to B, Not Coop
BRITTO AMUSEMENTS: Ind-Ra Cuts LT Issuer Rating to BB+, Non-coop.
CHETAN ALLOYS: CARE Cuts Rating on INR10cr LT Loan to C, Not Coop.
CORE JEWELLERY: Ind-Ra Lowers Long Term Issuer Rating to D
DEV INDIA: CARE Cuts INR8.37cr LT Loan Rating to B, Not Coop.
DR. M N TANDON: CARE Cuts Rating on INR4.26cr Loan to B, Not Coop.
FIREFLY BATTERIES: CARE Keeps D Debt Ratings in Not Cooperating
IL&FS ENERGY: CARE Keeps D Debt Ratings in Not Cooperating
IL&FS TAMIL: CARE Keeps D INR5584.93cr Debt Rating in Not Coop.
INDIA DAIRY: CARE Cuts Rating on INR15cr LT Loan to B, Not Coop.
INDSUR GLOBAL: CARE Keeps D Debt Ratings in Not Cooperating
MAPLE PANELS: Ind-Ra Cuts LT Issuer Rating to BB+, Not Coop.
MUNICIPAL COUNCIL: CARE Keeps B Issuer Rating in Not Cooperating
NANDAN BUILDCON: CARE Keeps D Debt Ratings in Not Cooperating
OM SAI: CARE Keeps D INR5.55cr Debt Rating in Not Cooperating
PARAMEX TRANSFORMERS: Insolvency Resolution Process Case Summary
PROFIVE ENGINEERING: Ind-Ra Gives BB Issuer Rating, Outlook Stable
QUADRANT TELEVENTURES: CARE Keeps D Debt Ratings in Not Coop
RELIANCE BROADCAST: CARE Reaffirms D Rating on INR83.69cr LT Loan
SAHA INFRATECH: CARE Keeps D INR160cr NCD in Not Cooperating
SHRIPAL GOEL: CARE Lowers Rating on INR6.50cr LT Loan to B
SINHGAD TECHNICAL: CARE Keeps D Debt Ratings in Not Cooperating
SURGICOIN MEDEQUIP: CARE Keeps D Debt Ratings in Not Cooperating
M A L A Y S I A
MAGNA PRIMA: Defaults on MYR37.79MM Term Loan
MAGNA PRIMA: Net Loss Widens to MYR7MM in Q1 Ended March 31
N E W Z E A L A N D
KIKKI K: Closes New Zealand Shops but Stays Open in Australia
S I N G A P O R E
HIN LEONG: HSBC Among Banks with Grim Chances to Recoup Loss
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A U S T R A L I A
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AUSTRALIAN ACADEMY: Second Creditors' Meeting Set for July 2
------------------------------------------------------------
A second meeting of creditors in the proceedings of Australian
Academy of Commerce Pty. Ltd. has been set for July 2, 2020, at
10:30 a.m. at Suite 1, Level 15, 9 Castlereagh Street, in Sydney,
NSW.
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 July 1, 2020, at 4:00 p.m.
Christopher Damien Darin of Worrells Solvency & Forensic
Accountants was appointed as administrator of Australian Academy of
Commerce on May 26, 2020.
BRIDGE BUSINESS: Second Creditors' Meeting Set for July 3
---------------------------------------------------------
A second meeting of creditors in the proceedings of Bridge Business
College Pty Ltd has been set for July 3, 2020, at 11:00 a.m. via
telephone only.
The purpose of the meeting is (1) to receive the report by the
Administrator about the business, property, affairs and financial
circumstances of the Company; and (2) for the creditors of the
Company to resolve whether the Company will execute a deed of
company arrangement, the administration should end, or the Company
be wound up.
Creditors wishing to attend are advised proofs and proxies should
be submitted to the Administrator by July 1, 2020, at 4:00 p.m.
Christopher Damien Darin of Worrells Solvency & Forensic was
appointed as administrator of Bridge Business on May 28, 2020.
OZTOPIA HOLDINGS: Second Creditors' Meeting Set for July 3
----------------------------------------------------------
A second meeting of creditors in the proceedings of Oztopia
Holdings Pty Ltd, trading as Oztopia Electrical and Oztopia, has
been set for July 3, 2020, at 10:00 a.m. at QV1 Conference Centre
Level 2, Theatrette 250 St Georges Terrace, in Perth, WA.
The purpose of the meeting is (1) to receive the report by the
Administrator about the business, property, affairs and financial
circumstances of the Company; and (2) for the creditors of the
Company to resolve whether the Company will execute a deed of
company arrangement, the administration should end, or the Company
be wound up.
Creditors wishing to attend are advised proofs and proxies should
be submitted to the Administrator by July 2, 2020, at 4:00 p.m.
Jimmy Trpcevski and David Ashley Norman Hurt of WA Insolvency
Solutions were appointed as administrators of Oztopia Holdings on
March 16, 2020.
QANTAS LTD: To Axe 6,000 Jobs and Raise AUD1.9BB in Fresh Capital
-----------------------------------------------------------------
Patrick Hatch at The Sydney Morning Herald reports that Qantas says
it does not expect to resume international flying in any meaningful
volume for another 12 months, and will sack 20 per cent of its
workforce as part of a three-year plan to recover from the COVID-19
pandemic.
According to the report, Chief executive Alan Joyce said on June 25
the airline had no choice but to make 6,000 of its 29,000 workers
redundant as the global aviation industry faced a years-long
recovery from the coronavirus crisis.
"We have to position ourselves for several years where revenue will
be much lower," the report quotes Mr. Joyce as saying. "Adapting to
this new reality means some very painful decisions."
A resumption of most international flights "will take a long time,"
he explained. "There'll be nothing this next financial year."
Qantas expects international flying to recover to 50 per cent of
its pre-pandemic volume in the 2022 financial year and to 75 per
cent in 2023, Mr. Joyce said.
Meanwhile domestic flying--currently sitting at around 15 per cent
of its usual network - could recover to 70 per cent of pre-pandemic
levels within a year, SMH relays.
SMH says Qantas--like almost all airlines around the world--has
been forced to ground most of its fleet, and now joins airlines
including Air New Zealand, British Airways and Lufthansa in laying
off a large number of workers.
Around 15,000 Qantas employees will remain stood down from duties
until flying returns, the company said on June 25.
According to SMH, the 6,000 redundancies will include office roles
(1,450 jobs), ground operations including baggage handlers (1500
jobs), cabin crew (1,050), engineering (630) and pilots (220)
across both Qantas and its budget arm Jetstar.
SMH relates that the Australian Services Union, representing Qantas
office staff, and the Transport Workers Union, representing ground
crew and other workers, said the redundancies were premature and
should be put on hold until the federal government reviewed and
possibly extended its JobKeeper wage subsidy program.
"Before Qantas slashed thousands of workers' jobs and takes more of
its planes down to the pawn shop it should be lobbying the federal
government for an extension to JobKeeper and financial support to
allow the airline to weather the crisis," SMH quotes TWU federal
secretary Michael Kaine as saying.
SMH relates that Mr. Joyce said discussions with the government
about a special wage support package for the aviation
industry--which unions have also been pushing for--had been
constructive, but ultimately there would not be work for many of
its employees for several years.
"Irrespective of what happens on JobKeeper or an alternative
mechanism, we don't have work for those employees," he said.
Under a plan to save AUD15 billion in costs over three years,
Qantas will retire six remaining Boeing 747s immediately, six
months ahead of schedule; ground around 100 aircraft including most
of its international fleet for up to 12 months, and defer
deliveries of new Boeing 787 Dreamliners and Airbus A320neos,
according to the report.
It will also put all 12 of its Airbus A380 superjumbos into storage
for at least three years, and wrote down most of their value as
part of a AUD1.4 billion non-cash impairment, SMH relays.
SMH adds that Qantas said its board had asked Mr. Joyce to remain
CEO at least until the middle of 2023 to ensure "leadership,
experience and stability". At that point, Mr. Joyce will have run
the airline for almost 15 years.
Mr. Joyce said Qantas expected to bring the 15,000 temporarily
stood-down employees back to work by the end of 2020 if state
borders reopen, but it would take until the middle of 2022 for its
full workforce to return.
"Any variation, second waves, could delay those stand-ups but don't
diminish our needs for those jobs," he said.
SMH says Qantas will also raise up to AUD1.9 billion in fresh
capital through a AUD1.3 billion share placement with fund
managers, and a non-underwritten share purchase plan for eligible
existing retail shareholders of up to AUD500 million. The placement
at a price of AUD3.65 per share comes at a 13 per cent discount to
Qantas' last trading price.
SMH relates that Mr. Joyce had ruled out an equity raising in early
May, but on June 25 said the capital injection would allow Qantas
to "accelerate" its recovery from the COVID-19 crisis.
The reorganisation of the business will cost around AUD1 billion,
including AUD600 million in redundancy payments. The raising will
also safeguard Qantas' investment grade credit rating, which
Mr Joyce said would mean it could still borrow money at cheap
rates.
SMH adds that Mr. Joyce said he had every intent on buying a fleet
of new A350s from Airbus once Qantas is flying again, so it can
launch its "Project Sunrise"--non-stop flights to London or New
York.
Citi analyst Jake Cakarnis said that while Qantas' moves to bolster
its liquidity and balance sheet would help, its path to recovery
would be "impacted by a multitude of factors beyond Qantas'
control".
"With a weaker outlook for global economic growth, potential for
structural changes to demand and competition, Qantas will need to
adapt to a significantly changed global aviation industry," the
report quotes Mr. Cakarnis as saying.
Qantas Airways Ltd. is Australia's principal airline. It has three
domestic flying brands: Jetstar (the point-to-point Low Cost
Carrier), QantasLink (a regional carrier) and Qantas mainline,
which predominantly links capital cities.
REDZED TRUST 2020-1: S&P Assigns B (sf) Rating to Class F Notes
---------------------------------------------------------------
S&P Global Ratings assigned its ratings to eight of the ten classes
of small-ticket commercial mortgage-backed, floating rate,
pass-through notes issued by Perpetual Trustee Co. Ltd. as trustee
of RedZed Trust STC Series 2020-1.
RedZed Trust STC Series 2020-1 is a securitization of loans to
Australian resident borrowers secured by first-registered mortgages
over Australian commercial or residential properties originated by
RedZed Lending Solutions Pty Ltd. (RedZed). This is the first
small-ticket commercial mortgage loan transaction sponsored by
RedZed rated by S&P Global Ratings.
The 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 it applies. This credit support comprises note
subordination for each class of rated note.
-- That the transaction's cash flows can meet timely payment of
interest and ultimate payment of principal to the noteholders under
the rating stresses. Key factors are the level of subordination
provided, the condition that a minimum margin will be maintained on
the assets, an amortizing liquidity facility sized at 3.0% of the
outstanding balance of the notes, and the principal draw function.
-- The extraordinary expense reserve of A$250,000, funded from day
one by RedZed, available to meet extraordinary expenses. The
reserve will be topped up via excess spread if drawn.
-- The legal structure of the trust, which has been established as
a special-purpose entity and meets S&P's criteria for insolvency
remoteness.
-- That loss of income for borrowers in the coming months due to
the effects of COVID-19 will likely put upward pressure on mortgage
arrears over the longer term. S&P has therefore applied a range of
additional stresses in our analysis to assess the rated notes'
sensitivity to liquidity stress, and the possibility of higher
arrears. As of June 10, 2020, borrowers with approved
COVID-19-related hardship arrangements make up 19.4% of the closing
pool balance.
S&P Global Ratings acknowledges a high degree of uncertainty about
the evolution of the coronavirus pandemic. The consensus among
health experts is that the pandemic may now be at, or near, its
peak in some regions but will remain a threat until a vaccine or
effective treatment is widely available, which may not occur until
the second half of 2021. S&P said, "We are using this assumption in
assessing the economic and credit implications associated with the
pandemic. As the situation evolves, we will update our assumptions
and estimates accordingly."
RATINGS ASSIGNED
RedZed Trust STC Series 2020-1
Class Rating Amount (mil. A$)
A-1-S AAA (sf) 95.0
A-1-L AAA (sf) 85.0
A-2 AAA (sf) 14.1
B AA (sf) 27.6
C A (sf) 29.1
D BBB (sf) 20.4
E BB (sf) 11.4
F B (sf) 8.4
G1 NR 5.4
G2 NR 3.6
NR--Not rated.
SUNKEN MONKEY: Second Creditors' Meeting Set for July 3
-------------------------------------------------------
A second meeting of creditors in the proceedings of Sunken Monkey
Operations Pty Limited has been set for July 3, 2020, at 11:30 a.m.
via teleconference facilities only.
The purpose of the meeting is (1) to receive the report by the
Administrator about the business, property, affairs and financial
circumstances of the Company; and (2) for the creditors of the
Company to resolve whether the Company will execute a deed of
company arrangement, the administration should end, or the Company
be wound up.
Creditors wishing to attend are advised proofs and proxies should
be submitted to the Administrator by July 2, 2020, at 5:00 p.m.
Graeme Robert Beattie of Worrells was appointed as administrator of
Sunken Monkey on May 28, 2020.
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C H I N A
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BEIJING CAPITAL: S&P Affirms BB+ Long-Term ICR, Outlook Negative
----------------------------------------------------------------
S&P Global Ratings affirmed its 'BB+' long-term issuer credit
rating on property developer Beijing Capital Land Ltd. (BCL).
S&P said, "We affirmed the issuer credit rating as we continue to
view Beijing Capital Land Ltd. (BCL) as a highly strategic
subsidiary of Beijing Capital Group Co. Ltd. (BCG). BCL still
contributes to around 50% of the group's EBITDA and accounts for
nearly two-thirds of the group's debt and provides important
operational support to the parent's primary land development
activities.
"However, we believe BCL's market position has gradually weakened
over the last several years due to its attributable contracted
sales growth falling behind peers and its slowing pace of market
expansion outside its home regions of Beijing, Tianjin, and Hebei.
Moreover, its revenue growth is also stagnating due to extensive
participation in unconsolidated joint venture (JV) projects, which
has resulted in an increasing portion of contracted sales not
contributing to its topline.
"We therefore expect BCL's leverage to remain very high in the next
two years even if the company controls its debt levels. Due to the
weaker business growth performance and persistently higher leverage
compared with peers of similar size, we revised BCL's stand-alone
credit profile to 'b-' from 'b'.
"In our view, we have not seen the heavy land investment activities
since 2017 translating into strong growth in contracted sales. The
company has extensively relied on increasing its participation in
unconsolidated JV projects to expand its total contracted sales in
the last few years. So even as BCL's total contracted sales grew to
Chinese renminbi (RMB) 80.8 billion in 2019 from RMB55.8 billion in
2017, the attributable contracted sales growth has been much more
modest. We estimate the sales consolidation ratio declined to
around 35%-40% in 2019, from around 50% in 2017, with actual cash
collection on a consolidated contracted sales under RMB20 billion
in 2019. In addition, we expect contracted sales to remain flat for
the 2020 full year due to the impact of the COVID-19 outbreak."
As such, BCL's revenue growth is unlikely to pick up substantially
following the lackluster performance in 2019. In fact, the
company's recognition of property delivery dropped to RMB15.6
billion in 2019, from RMB19.2 billion in 2018, partially due to
BCL's development cycles being relatively long, especially in its
home regions. S&P said, "We do not expect significant topline
growth in 2020 as the effects of the COVID-19 outbreak are likely
to weigh on the construction and delivery schedule. In addition,
BCL's JV projects are slow in generating revenue, as they typically
run into even longer construction and delivery cycles when more
than one partner is involved. Therefore, we do not expect
consolidated or see-through EBITDA to significantly increase in
2020."
S&P said, "In our view, BCL's current leverage with debt to EBITDA
at over 17x is not sustainable in the long term. We expect the
company's EBITDA interest coverage to also hover around 1x over the
next couple of years, which means interest servicing is now quite
strenuous for the company. We believe BCL's current financial
position would expose it to risks of potential funding cost hikes
from waning confidence in the capital markets and financial
institutions, although we see the likelihood of such occurrences as
remote in the near term."
However, BCL's currently liquidity position remains sound and we do
not see any substantial refinancing risks. Its cash balance is
sufficient to cover its short-term debt and it also has good access
to low-cost financing thanks to its status as a state-owned
enterprise (SOE) and long-established standing in capital markets.
In the first quarter, the company was able to issue both domestic
and U.S. dollar bonds at below 4% coupon rates, which is low among
industry peers.
S&P said, "We believe BCL's debt growth in the next two years will
be limited, although the company's total debt including perpetual
instruments already surpassed RMB110 billion in 2019 as the company
dials down its land investments.) We believe the company's land
investment cash outflow will fall below 40% of its contracted sales
cash collection in 2020, compared with over 60% in the previous
years, as BCL sources more secondary land. We expect any additional
debt to mainly arise from the capital expenditure on its land
projects, which typically demand large upfront cash outflows and
have an extended cash collection cycle.
"We expect BCL to continue to dispose of legacy commercial property
assets on an intermittent basis, but view that these transactions
cannot be relied on as a routine source of cash inflow. In 2018 and
2019, BCL disposed of equity in subsidiary project companies that
hold commercial property assets in Beijing as a means to supplement
its cash flow and profits. We believe these transactions indeed
helped BCL to recoup capital, as well as contributed to its bottom
line, but had little benefit in helping the company deleverage as
the company's debt dwarfs those assets.
"We expect BCL's shopping outlet operating subsidiary to also see a
halt in revenue growth in 2020 as retail footfall has suffered
heavily under the COVID-19 outbreak and weak economic conditions.
The company has indicated that it will not increase its shopping
outlet presence from its existing 17 cities and we expect rental
income growth from its outlet portfolio to fall to the low teens in
2020 compared with around 50% in 2019. At this level, rental
revenue covers a little over 10% of the company's total interest
expense.
"We believe the parent's stand-alone credit profile is to a large
extent driven by that of BCL, whose persistently high leverage in
turn keeps the group's leverage elevated. However, since BCG is a
conglomerate with other substantial sectors, its credit profile may
follow different trends."
The negative outlook on BCL mirrors that on its parent, BCG, and
our expectation that the company's leverage will stay high with
EBITDA growth slower than that of debt.
At the same time, the negative outlook reflects S&P's view that
BCG's leverage may rise from its current high level over the next
18-24 months. It also reflects the rising business concentration
risk as the group relies more heavily on the development segment
for profit and cash flow contributions, while proportional
contributions from the environmental and infrastructure segments
decrease.
S&P said, "We could downgrade BCL if we lower the rating on BCG. In
a less likely scenario, we may lower the rating on BCL if we
believe the company's importance to the group slips, or the group's
control of BCL weakens.
"We could lower the rating if BCG's growth execution falters and
its debt expansion is faster than we anticipate, or its social
housing and primary land development businesses do not generate the
desired level of profit and cash flow, such that its debt-to-EBITDA
ratio deteriorates from the current 13x-14x.
"We could revise the outlook on BCL back to stable if BCG's outlook
stabilizes. This could be indicated by BCG achieving stronger
operating performance and EBITDA growth compared to our base case,
while prudently managing debt expansion such that its
debt-to-EBITDA ratio demonstrates a clear improving trend toward
10x."
CHINA AOYUAN: Fitch Assigns BB- Rating to New USD Sr. Notes
-----------------------------------------------------------
Fitch Ratings has assigned China Aoyuan Group Limited's
(BB-/Positive) proposed US dollar senior notes a 'BB-' rating.
The notes are rated at the same level as Aoyuan's senior unsecured
rating because they constitute its direct and senior unsecured
obligations. Aoyuan intends to use the net proceeds from the issue
to primarily refinance its existing debt.
Aoyuan's business profile has improved after the property developer
completed a nationwide layout in the past two years, as evident in
wider geographic diversification, enlarged scale and better
customer recognition. The company has shown financial discipline
during the expansion, with proportionate consolidated leverage at
around 40% and healthy profitability. However, it also has
meaningful penetration into lower-tier cities, where housing demand
is more uncertain in an industry slowdown, and slower cash
collection amid a tight credit environment.
KEY RATING DRIVERS
Increasing Diversification: Aoyuan has expanded into a nationwide
developer with a more diversified land bank layout. It had 280
projects in 85 cities across China at end-2019. Aoyuan has a solid
base in Guangdong province accounting for 32% of the total land
bank of 45 million sq m. It has also established a greater presence
in major economic zones, including the Yangtze River Delta and
central and western China, which together represent 44% of the
total land bank at end-2019. The expansion enables Aoyuan to
sustain its sales growth, instead of being affected by
city-specific austerity policies.
Larger Sales Scale: Aoyuan's attributable contracted sales rose by
26% to CNY98 billion in 2019, and recorded CAGR of 62% in 2016-2019
- one of the fastest growth rates among peers. Aoyuan's scale is
comparable with 'BB' rated peers, such as CIFI Holdings (Group) Co.
Ltd (BB/Stable) and Logan Property Holdings Company Limited
(BB/Stable).
Controlled Leverage: Aoyuan's leverage - measured as net
debt/adjusted inventory on a proportionate consolidation basis -
stayed at around 40% in 2019 because of disciplined land
acquisition, with the cash land premium accounting for no more than
45% of sales proceeds. This was partially offset by a slower cash
collection of 78% amid the unfavourable credit and policy
environment for the property segment. The slowdown in cash
collection is in line with the industry trend, although slightly
lower than the industry average of 80%, due partly to a
faster-than-peer sales growth and largely back-loaded presale
activities.
Stable profitability: Fitch expects Aoyuan's EBITDA margin, after
adding back capitalised interest in cost of goods sold, to stay at
above 25% in the short to medium term. The company had unbooked
revenue of around CNY171 billion with a healthy gross profit margin
of more than 25% as of end-2019, ensuring profitability within next
two years. Average land bank costs were low at CNY2,536/sq m at
end-2019, or 25% of the Fitch-estimated average selling prices, as
the company replenishes land mainly through cost-friendly M&A,
contributing 79% of the company's newly acquired land.
Higher Business Risk: Aoyuan is more exposed to industry downside
risk due to the meaningful penetration into lower-tier cities and
higher commercial property exposure than 'BB-' peers. Its
contracted average selling price of around CNY10,100/sq m is lower
than the CNY13,500-17,000/sq m of peers, including CIFI and Logan.
However, 67% of the lower-tier land bank was in southern China and
the Yangtze River Delta at end-2019. Fitch believes these two
property markets are more resilient than other regions.
Fitch believes Aoyuan's large exposure to commercial-property
sales, which have a lower sell-through rate than residential
products and are more susceptible to economic cycles, leaves the
company more vulnerable to operational risk than peers that sell
only residential projects. Aoyuan's contracted sales were 20%
commercial properties in 2019 under its integrated
project-development strategy. Fitch expects the product mix to
remain stable in the short term, as commercial products account for
25% of saleable resources in 2020.
DERIVATION SUMMARY
Logan is Aoyuan's most comparable peer. Logan's land bank quality
is higher than that of Aoyuan because of a stronger presence and
higher concentration in the Greater Bay Area. It also has a longer
land bank life of five years (Aoyuan: more than three years), which
poses less pressure on the company's leverage. Aoyuan, however, has
a more balanced layout nationwide.
Both CIFI and Aoyuan have similar scale and are diversified
nationwide. CIFI has better land bank quality than Aoyuan. The
majority of CIFI's land is in tier 1-2 cities and the company is
more focused in the Yangtze River Delta, where the economy is more
robust than rest of China. Aoyuan has faster growth due to the
rapidly expanding Greater Bay Area. It operates under a faster
churn model while keeping its leverage at 35%-40%, lower than
CIFI's 45%-50%. However, CIFI has quality investment properties,
including offices and shopping malls in tier 1-2 cities, that
generate interest coverage that supports CIFI's rating.
Aoyuan's contracted sales scale is larger than CNY40 billion-60
billion range (on an attributable basis) for 'BB-' peers, including
Yuzhou Properties Company Limited (BB-/Stable), Times China
Holdings Limited (BB-/Stable) and KWG Group Holdings Limited
(BB-/Stable). Aoyuan's land bank is more geographically diversified
and larger than those three companies, which are more regionally
based and have operations in less than 40 cities (Aoyuan: 85
cities). Aoyuan's proportionate consolidated leverage is lower than
Yuzhou's and Times's 40%-45%. They have a similar profitability of
25%-30%. Aoyuan's better business and financial profile is
sufficient to support the Positive Outlook.
KEY ASSUMPTIONS
Fitch's Key Assumptions Within Its Rating Case for the Issuer
- Attributable sales to exceed CNY80 billion in 2019 and CNY90
billion-110 billion in 2020-2021
- Land premium accounting for 40%-50% of contracted sales each
year on a cash flow basis during 2019-2021
- Land bank life maintained at above three years
- Company to maintain a fast-churn business model
RATING SENSITIVITIES
Factors that could, individually or collectively, lead to positive
rating action/upgrade:
- Increasing scale and geographic diversification without
compromising financial metrics, including:
- net debt/adjusted inventory sustained below 40%;
- contracted sales/gross debt sustained above 1.2x; and
- EBITDA margin sustained above 25%.
Factors that could, individually or collectively, lead to negative
rating action/downgrade:
- Failure to reach its Positive Outlook guidelines would lead to
the Outlook reverting to Stable.
LIQUIDITY AND DEBT STRUCTURE
Adequate Liquidity: Aoyuan had CNY58.8 billion in available cash on
hand at end- 2019, sufficient to cover short-term debt of CNY42.1
billion. The company has multiple funding channels, including
onshore and offshore bank loans, and private and public bond
issuances.
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).
CHINA AOYUAN: S&P Assigns B Rating to New USD Sr. Unsecured Notes
-----------------------------------------------------------------
S&P Global Ratings assigned its 'B' long-term issue rating to the
U.S. dollar-denominated senior unsecured notes that China Aoyuan
Group Ltd. (Aoyuan; B+/Positive/--) proposes to issue. Aouyuan will
use the net proceeds mainly to refinance existing borrowings. The
issue rating is subject to our review of the final issuance
documentation.
S&P said, "We rate the notes one notch below the issuer credit
rating on Aoyuan, given significant subordination risk in the
China-based developer's capital structure. As of Dec. 31, 2019,
Aoyuan's capital structure consisted of Chinese renminbi (RMB) 64.5
billion in secured debt and RMB30.8 billion in unsecured debt. The
secured debt ratio is 68%, above our 50% threshold for notching
down the issue rating."
While Aoyuan does not face any U.S. dollar-denominated notes
maturity in the rest of 2020, US$613 million of its notes will be
due for repayment in the first half of next year. S&P expects the
company to use the proceeds from the latest issuance to early
refinance these offshore maturities, thereby lengthening its debt
maturity profile and bolstering its liquidity position.
The positive outlook on Aoyuan reflects high visibility over the
company's deleveraging trend. We expect steady sales, strong
revenue growth with above-average profitability and moderate debt
growth from disciplined expansion to support significant
deleveraging over the next six to 12 months. Aoyuan's contracted
sales fell 13% to RMB33.3 billion in the first five months of 2020
due to the brunt of the COVID-19 outbreak, representing about 25%
of management's target of RMB132 billion for the year. S&P expects
the company to gradually pick up its sales momentum, supported by
its abundant saleable resources.
JIANGSU HANRUI: Fitch Withdraws B LT IDRs for Commercial Reasons
----------------------------------------------------------------
Fitch Ratings has affirmed Jiangsu HanRui Investment Holding Co.,
Ltd.'s 'B' Long-Term Foreign- and Local-Currency Issuer Default
Ratings, and the 'B' rating on the USD110 million 6.25% senior
secured notes due December 2020, which are issued by Hanrui
Overseas Investment Co., Ltd. Fitch has also revised Jiangsu
HanRui's Outlook to Stable from Negative. Fitch has simultaneously
withdrawn the ratings.
The Outlook was revised to Stable because of the reduction in the
proportion of short-term debt to total debt, which helped HanRui's
Standalone Credit Profile to improve.
HanRui is the flagship government-related entity (GRE) for urban
development within the Zhenjiang New Area, a national-level
economic and technological development zone in Jiangsu province of
China.
Fitch is withdrawing the ratings due to commercial reasons.
KEY RATING DRIVERS
'Strong' Status, Ownership and Control: Fitch assessed the
government ownership and control structure to be 'Strong', in line
with other national-level development zone peers. Fitch believes
the government's control of HanRui is less direct, which was the
major constraint against higher attribute strength. HanRui remains
wholly owned by the Zhenjiang State-owned Assets Supervision and
Administration Commission, and is under the administration of the
Zhenjiang New Area management committee. The municipality, via the
management committee, appoints HanRui's senior management, and
supervises or approves the company's major strategic and financing
decisions.
'Moderate' Support Record, Expectations: The government has a
record of providing recurring financial support for HanRui,
including annual subsidies, debt swaps and capital injections.
However, the level support has not been sufficient relative to the
company's debt structure challenges. For 2019, HanRui received
subsidies of CNY493 million and a capital injection of CNY500
million. Fitch expects government support to continue and remain
essential to support the company's public-sector policy role.
'Moderate' Socio-Political Impact of Default: Fitch believes HanRui
plays a key role in the urban development of the Zhenjiang New
Area, which accounted for approximately 16% of the city's total
gross regional product. Hence, a default could disrupt the economic
development of the zone. However, there is more than one urban
developer within Zhenjiang that can replace HanRui in its policy
role, although not without some impact on the new area.
'Strong' Financial Implications of Default: HanRui is among the
largest GREs under the control of the municipality by total assets.
Fitch believes a default by HanRui could raise doubts over the
municipality's credibility in light of the company's asset size and
substantial receivables due from the government. The attribute was
not given a higher assessment as the company's geographical
concentration means it may not be seen as a proxy for the city.
Standalone Credit Profile of 'ccc': Fitch believes HanRui's
Standalone Credit Profile (SCP) improved in 2019, although it was
not sufficient to warrant an upgrade. The SCP assessment is mainly
driven by a weak financial profile, with a net debt to EBITDA over
30x in 2019, as well as weak liquidity in terms of unrestricted
cash relative to its level of short-term debt. During the year, the
company's debt structure saw a slight improvement, with the
short-term debt accounting for 38% of its total debt, a decline
from 2018.This resulted in a revision of the Outlook to Stable, as
Fitch believes further deterioration in the SCP is less likely.
'Weaker' Revenue Defensibility, Operating Risk: The company faces
customer and geographical concentration, as its revenue is derived
mainly from the Zhenjiang New Area and hence is sensitive to the
city's slowing growth. In addition, the company's ability to pass
on fluctuations in operating costs will be subject to the sponsor's
financial strength.
DERIVATION SUMMARY
Fitch classifies HanRui as a GRE under its Government-Related
Entities Rating Criteria with an overall support score of 22.5. The
score factors in the government's ownership and strong control, as
well as the company's policy role in urban development in the
Zhenjiang New Area. HanRui's SCP is assessed under Fitch's Public
Sector, Revenue-Supported Entities Rating Criteria.
RATING SENSITIVITIES
Rating sensitivities are not applicable as the ratings have been
withdrawn.
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).
[*] State Auditor Warns of Hidden Bad Loan Risks for Small Banks
----------------------------------------------------------------
Caixin Global reports that some small banks have many more bad
loans than expected, China's state auditor said following an
inspection of lenders as the country increases availability of
credit to bolster the virus-hit economy.
Of 43 smaller regional lenders reviewed by the National Audit
Office, 16 had bad loan ratios that were nearly twice as high as
the lenders publicly disclosed, the auditor found, Caixin relays.
The average bad loan ratio of the audited institutions was 2.48% as
of the end of the first quarter, according to the report.
Caixin relates that the country's 10 largest lenders reported bad
loan ratios of 1.43% on average, but the outstanding value of their
unpaid loans rose 8.26% from the same time last year, the auditor
said.
According to Caixin, the state auditor also uncovered violations by
lenders such as charging illegal fees and linking loan issuance to
deposits. Such practices increased companies' borrowing costs by
nearly CNY1.8 billion ($255 million), the auditor said.
Chinese regulators this year took a series of steps to encourage
lenders to expand credit for small enterprises while cutting
borrowing costs to support business recovery from the pandemic,
Caixin says. Some analysts voiced concerns over bad loan risks amid
the lending push and weakening economy.
=========
I N D I A
=========
ABAG HI-TECH: Insolvency Resolution Process Case Summary
--------------------------------------------------------
Debtor: Abag Hi-Tech Education Limited
Registered office:
106, Vishwadeep Tower
Plot No. 4, District Center
Janakpuri New Delhi
West Delhi DL 110058
IN
Insolvency Commencement Date: June 12, 2020
Court: National Company Law Tribunal, Delhi Bench
Estimated date of closure of
insolvency resolution process: December 9, 2020
(180 days from commencement)
Insolvency professional: Mr. Debashis Nanda
Interim Resolution
Professional: Mr. Debashis Nanda
CS-14, C-Floor, Ansal Plaza
Vaishali, Ghaziabad
Uttar Pradesh 201010
E-mail: dnanda.cma@gmail.com
cirp.abaghitech@gmail.com
Last date for
submission of claims: June 29, 2020
AJIT AGRO: CARE Cuts Rating on INR7.0cr LT Loan to B-, Not Coop.
----------------------------------------------------------------
CARE Ratings revised the ratings on certain bank facilities of Ajit
Agro Industries (AAI), as:
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long-term Bank 7.00 CARE B-; Stable, Issuer not
Facilities cooperating; Revised from
CARE B; Stable; on the basis
of best available information
Detailed Rationale & Key Rating Drivers
CARE had, vide its press release dated April 24, 2019, placed the
ratings of AAI under the 'Issuer noncooperating' category as AAI
had failed to provide information for monitoring of the rating as
agreed to in its Rating Agreement. AAI continues to be
non-cooperative despite repeated requests for submission of
information through phone calls and letter/emails dated May 19,
2020, May 21, 2020, May 22, 2020, May 28, 2020 and June 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.
The ratings assigned to the bank facilities of AAI have been
revised on account of non-availability of latest financial and
operational performance.
Detailed description of the key rating drivers
At the time of last rating done on April 24, 2019, the following
were the rating strengths and weaknesses:
Key Rating Weaknesses
* Financial risk profile marked by fluctuating TOI and
profitability: TOI of AAI shown a fluctuating trend over the past
three financial years ended FY16 owing to volatility exhibited in
the Prices of raw cotton coupled with Government of India's
intervention by way of extensive procurement of cotton directly
from farmers in the regions to support the minimum support prices.
* Moderately leveraged capital structure with weak debt coverage
indicators: The capital structure of the firm stood moderately
leveraged although improved marginally from March 31, 2015
attributed to higher net worth base due to accretion of profit to
reserve along with infusion of capital by the partners to support
its business operation. Furthermore, debt service coverage
indicators of the firm stood weak with total debt to GCA of 26.08
times as on March 31, 2016 along with interest coverage at 1.53
times during FY16.
* Presence in a highly fragmented cotton ginning industry and
constitution as a partnership concern: AAI is primarily engaged in
the business of cotton ginning and pressing industry as well as
extraction of cotton oil. The industry is highly fragmented with
presence of numerous independent small scale enterprises. Its
constitution as a partnership concern with moderate net worth base
restricts its overall financial flexibility in terms of limited
access to external fund for any future expansion plans.
Furthermore, there is an inherent risk of possibility of withdrawal
of capital and dissolution of the concern in case of
death/insolvency of partner.
* Operating margins are susceptible to cotton price fluctuation,
seasonality associated with the cotton industry and government
regulation: The prices of raw cotton are highly volatile in nature
and depend upon factors like, area under production, yield for the
year, international demand-supply scenario, export quota decided by
the government and inventory carried forward of the last year.
Furthermore, the cotton prices in India are highly regulated by
government; hence, any adverse change in the government policy may
negatively impact the prices resulting in lower realizations and
profit.
Key Rating Strengths
* Experienced promoters with long track record of operations: The
partners of the firm are experienced with long track record of
operations in the cotton ginning industry. Furthermore, it is
benefited from established good relations with the customers and
suppliers.
* Strategic location of manufacturing units with close proximity to
raw material sources: The manufacturing facility of the firm is
located in cotton producing belt of Khandwa (Madhya Pradesh) which
is one of the largest producer of raw cotton in India. The presence
of AAI in cotton producing region results in benefit derived from
lower logistics expenditure (both on transportation and storage),
easy availability and procurement of raw materials at effective
price.
Khandwa-based (Madhya Pradesh) AAI was formed in 1997 as a
partnership concern by its key promoter, Mr. Ajit SinghUbeja along
with his family members, to primarily undertake the business of
cotton ginning and pressing activity along with extraction of
cotton oil. The firm caters to the domestic market and sells its
products directly all over India. It procures raw cotton, key raw
material, from the local market and nearby areas while procure
cotton seeds mainly from Southern states of India.
ANMOL ASSOCIATES: Ind-Ra Moves BB Issuer Rating to Non-Cooperating
------------------------------------------------------------------
India Ratings and Research (Ind-Ra) has migrated Anmol Associates'
Long-Term Issuer Rating to the non-cooperating category. The issuer
did not participate in the rating exercise despite continuous
requests and follow-ups by the agency. Therefore, investors and
other users are advised to take appropriate caution while using the
rating. The rating will now appear as 'IND BB (ISSUER NOT
COOPERATING)' on the agency's website.
The instrument-wise rating actions are:
-- INR50 mil. Fund-based working capital limits migrated to non-
cooperating category with IND BB (ISSUER NOT COOPERATING) /
IND A4+ (ISSUER NOT COOPERATING) rating; and
-- INR200 mil. Non-fund-based working capital limits migrated to
non-cooperating category with IND A4+ (ISSUER NOT
COOPERATING) rating.
Note: ISSUER NOT COOPERATING: The ratings were last reviewed on
June 28, 2019. Ind-Ra is unable to provide an update, as the agency
does not have adequate information to review the ratings.
COMPANY PROFILE
Established in 2013, Anmol Associates is engaged in the
construction of roads and building, and irrigation works. It is an
approved Class A civil contractor for Uttar Pradesh Public Works
Departments and Class AA contractor for Lucknow Development
Authority and Uttar Pradesh Irrigation Department.
ARPEE ENERGY: CARE Cuts Rating on INR7cr LT Loan to B, Not Coop.
----------------------------------------------------------------
CARE Ratings revised the ratings on certain bank facilities of
Arpee Energy Minerals Private Limited (AEMPL), as:
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long-term Bank 7.00 CARE B; Stable, Issuer not
Facilities cooperating; Revised from
CARE B+; Stable; on the basis
of best available information
Detailed Rationale & Key Rating Drivers
CARE has been seeking information from AEMPL to monitor the rating
vide e-mail communications/letters dated June 2, 2020, June 3,
2020, June 4, 2020 and numerous phone calls. However, despite
CARE's repeated requests, the Company has not provided the
requisite information for monitoring the rating. In line with the
extant SEBI guidelines, CARE has reviewed the rating on the basis
of the publicly available information which, however, in CARE's
opinion is not sufficient to arrive at a fair rating. The rating of
AEMPL's bank facilities will now be denoted as CARE B; Stable;
ISSUER NOT COOPERATING. Further, the banker could not be
contacted.
Users of this rating (including investors, lenders and the public
at large) are hence requested to exercise caution while using the
above rating.
The rating takes into account company's small scale of operations
with low profit margins on account of trading nature of business,
volatility in prices of traded goods, working capital intensive
nature of operations marked by high collection period, intensely
competitive nature of the industry with presence of many
unorganized players. Moreover, the rating continues to derive
strengths by experienced management team with satisfactory track
record of operations and satisfactory demand outlook of the
product.
Detailed description of the key rating drivers
Key Rating Weaknesses:
* Small scale of operations with low profit margins on account of
trading nature of business: AEMPL is a relatively small player in
coal trading business with revenue of INR73.96 crore in FY19 (41.74
crore in FY18). The small scale restricts the financial flexibility
of the company in times of stress. This apart, the profitability of
the company has been low over the years due to trading nature of
business. The PBILDT margin was 2.34% in FY19 vis-a vis 3.35 % in
FY18 and PAT margin was also low at 0.76% during FY19 which was in
line with the PBILDT margin.
* Volatility in prices of traded goods: AEMPL purchases coal from
domestic suppliers, depending on receipt of orders and inventory
requirement for trading on stock & sale basis.
* Working capital intensive nature of operations marked by high
collection period: The operations of the company are working
capital intensive as reflected by elongated operating cycle of 93
days in FY19 (FY18: 131 days). The funds have mainly remained
blocked in debtors with a high average collection period for the
company. The collection period remained on the higher side as the
payment comes only after delivery of the goods. Furthermore, the
company has allowed a large credit period to its customers due to
its low bargaining power and high competition in the segment. The
average utilization of fund based limit was around 90% during last
twelve months ended in March 31, 2019.
* Intensely competitive nature of the industry with presence of
many unorganized players: The company is into trading of coal
which is highly fragmented and competitive in nature due to low
entry barriers. Further all the entities trading the same products
with a little product differentiation resulting into price driven
sales. Intense competition restricts the pricing flexibility of
the company.
Key Rating Strengths:
* Experienced management team and satisfactory track record of
operations: Mr. Praveen Kumar Agarwal aged about 61 years, having
around four decades of experience in coal trading activities. Mr.
Agarwal looks after the overall management of the company. Further
Mr. Agarwal is supported by Mr. Raman Mehra aged about 63 years,
who is also having four decades of experience in existing line of
business.
* Satisfactory demand outlook of the product: Coal is being used
as primary fuel and energy source for most of the manufacturing and
power industries. Thus, the industry enjoys large consumption
across the country. The demand has been driven by the rapidly
growing industrialization and urbanization throughout the country.
The company primarily sells its products to industrial states like
Jharkhand, West Bengal etc.
Arpee Energy Minerals Private Limited (AEMPL) was incorporated in
March 2006 by Mr. Praveen Kumar Agarwal and Mr. Raman Mehra. The
company is engaged in the business of coal trading. The company
procures its trading material from Central coalfields limited,
Bihar foundry & castings ltd etc. and sells the same to various
industries like steel, power etc. The day-to-day affairs of the
company are looked after by Mr. Praveen Kumar Agarwal (Director)
with adequate support from other director- Mr. Raman Mehra and a
team of experienced personnel.
BALAJI MOBITECH: CARE Keeps D Debt Ratings in Not Cooperating
-------------------------------------------------------------
CARE Ratings said the rating for the bank facilities of Balaji
Mobitech Private Limited (BMPL) 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 best available
information
Short Term Bank 10.00 CARE D; Issuer not cooperating;
Facilities Based on best available
information
Detailed Rationale & Key Rating Drivers
CARE had, vide its press release dated March 12, 2019; placed the
rating(s) of BMPL under the 'issuer non-cooperating' category as
BMPL had failed to provide information for monitoring of the
rating. BMPL continues to be non-cooperative despite repeated
requests for submission of information through e-mails dated May
28, 2020; June 2, 2020 and June 8, 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
At the time of last rating on March 12, 2019 the following were the
rating strengths and weaknesses:
Key Rating Weaknesses
* Ongoing Delays in interest servicing: Due to ongoing tax &
regulatory issues there were ongoing delays in servicing of
interest by the company in the past. The same was confirmed by the
company's banker.
Key Rating Strengths
* Experienced Promoters: BMPL has been in the mobile trading
business since last 8 years. The company has recently been
purchased by Mr. Amit Singhania & Mr. Amit Aggarwal, who have been
associated with BMPL since inception. The directors also have
previous experience in this field. Mr. Amit Singhania has been in
mobile trading line for past 13 years.
Balaji Mobitech Pvt. Ltd. (BMPL) was incorporated on April 25,
2007. BMPL is involved in trading of mobile phones, mobile phone
batteries & chargers and accessories such as hand free kit, data
cable, MMC card etc. As already communicated during last review, in
July'15, Mr. Sushil Kumar sold his entire share to the current
director's viz. Mr. Amit Singhania & Mr. Amit Aggarwal.
The company buys 'MAXX' brand mobile handsets, batteries and other
accessories from Maxx Mobile Communications Ltd, Maxx Moblink Pvt.
Ltd, and other distributors of MMCL & MMPL. The company also sells
mobile phones & accessories imported from China.
BANMORE FOAM: CARE Cuts Rating on INR5.92cr Loan to B-, Not Coop.
-----------------------------------------------------------------
CARE Ratings revised the ratings on certain bank facilities of
Banmore Foam Private Limited (BFPL), as:
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long-term Bank 5.92 CARE B-; Stable, Issuer not
Facilities cooperating; Revised from
CARE B+; Stable; on the basis
of best available information
Short term Bank 2.25 CARE A4' Issuer not
Facilities Cooperating; Based on best
available information
Detailed Rationale & Key Rating Drivers
CARE had, vide its press release dated March 15, 2019 placed the
ratings of BFPL under the 'Issuer non-cooperating' category as BFPL
had failed to provide information for monitoring of the rating as
agreed to in its Rating Agreement. BFPL continues to be
non-cooperative despite repeated requests for submission of
information through phone calls and letter/emails dated April 24,
2020, April 27, 2020 and June 8, 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 Rationale & Key rating Drivers
The ratings assigned to the bank facilities of BFPL have been
revised on account of non-availability of latest financial and
operational information as well as CARE's inability to carry out
due diligence exercise with lenders.
The ratings continue to remain constrained on account of thin
profitability margins and moderate capital structure. The ratings
are further constrained on account of presence in highly
competitive and fragmented polyurethane industry. The ratings,
however, derives strength from experienced promoters established
brand name and increase in Total Operating Income (TOI).
Detailed description of the key rating drivers
At the time of last rating done on March 15, 2019, the following
were the rating strengths and weaknesses:
Key Rating Weaknesses
* Decline in profitability: The profitability margins of the
company remain low with PBILDT margin and PAT margin of 5.02% and
0.58% respectively in FY19 as against PBILDT margin of 5.29% and
PAT margin of 0.74% in FY18.
* Moderate Capital structure: The capital structure of the company
remain leveraged with an overall gearing of 2.54 times as on March
31, 2019 which increased from 2.51 times as on March 31, 2018
mainly on account of term loans availed by company and higher
utilization of working capital bank borrowings as on balance sheet
date. Further, debt coverage indicators of the company remain
moderate marked by total debt to GCA of 14.41 times as on March 31,
2019 (TDGCA of 15.07 times as on March 31, 2018). Moreover,
interest coverage ratio remained moderate at 1.73 times as on March
31, 2019 (1.70 times as on March 31, 2018.)
* Presence in highly competitive and fragmented polyurethane
industry: The polyurethane industry is dominated by players
operating in the small and medium-scale sector, resulting in high
fragmentation and intense competition. These players mainly cater
to regional demand and enjoy the benefits of lower cost in terms of
proximity to customers and raw material suppliers. Further, due to
low product differentiation and value addition, the industry is
highly competitive with price being the key differentiating factor.
The operations of BFPL are linked to the cyclical nature of
furniture industry as majority of the sales are to furniture sector
and could be affected by any deceleration in these industry.
Key Rating Strengths
* Experienced promoters with long track record of operations: BFPL
has a presence of more than 30 years in the polyurethane foam
market. Mr. Yogesh Chandra Mittal, the key promoter, has an
extensive experience in this domain of around four decades and
looks after the overall management of the company. He is assisted
by Mr. Atul Jain who has more than 3 decades of experience in the
industry. He is further assisted by Mr. Pradeep Jain, Mr. Karan
Jain, Mr. K.C. Jain and Mr. Sharad Jain who also have extensive
experience. Being present in the industry since long period of
time, it has established customer and supplier base in the market.
* Increase in Total Operating Income (TOI): TOI of the company has
increased by around 15% in FY19 over FY18 and remained at INR44.12
crore (INR38.44 crore in FY18).
Banmore Foam Private Limited (BFPL) was incorporated in 1986 by Mr.
Yogesh Chandra Mittal. The company is engaged in the business of
manufacturing of PU foam sheets, foam rolls and other foam products
which find application in the furniture, leather, garments,
automobile, footwear, musical instrument and packaging industries.
In FY12, the company had started manufacturing of home-made ups and
markets under the brand name Cozymate. The plant of the company is
located in the notified backward industrial area of Banmore, Distt.
Morena, Madhya Pradesh. It is an ISO Certified Company. The company
has an installed capacity of 40000 Tonnes Per Annum.
BARATH BUILDING: Ind-Ra Lowers Long Term Issuer Rating to BB+
-------------------------------------------------------------
India Ratings and Research (Ind-Ra) has downgraded Barath Building
Constructions (India) Private Limited's Long-Term Issuer Rating to
'IND BB+ (ISSUER NOT COOPERATING)' from 'IND BBB (ISSUER NOT
COOPERATING)'. The issuer did not participate in the rating
exercise despite continuous requests and follow-ups by the agency.
Thus, the rating is based on the best available information.
Therefore, investors and other users are advised to take
appropriate caution while using these ratings.
The instrument-wise rating action is:
-- INR920 mil. Term loan due on February 2020 downgraded with IND
BB+ (ISSUER NOT COOPERATING) rating.
Note: ISSUER NOT COOPERATING: Issuer did not cooperate; based on
the best available information.
KEY RATING DRIVERS
The downgrade reflects lower financial transparency, with the
non-availability of financials in the public domain.
Barath Building Constructions (India) did not participate in the
rating exercise despite continuous requests and follow-ups by the
agency. The company has not provided information such as audited
financials, interim financials, utilization reports and key details
required for the surveillance exercise.
COMPANY PROFILE
Incorporated in 1986, Barath Building Constructions (India) is a
Chennai-based residential real estate developer. The company is
promoted by Vummidi Ananth, Vummidi Barath and Vummidi Barath.
BHANDARI AGROFEEDS: CARE Cuts INR11.50cr Loan Rating to B, Not Coop
-------------------------------------------------------------------
CARE Ratings revised the ratings on certain bank facilities of
Bhandari Agrofeeds Private Limited (BAPL), as:
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long-term Bank 11.50 CARE B; Stable, Issuer not
Facilities cooperating; Revised from
CARE B+; Stable; on the basis
of best available information
Detailed Rationale & Key Rating Drivers
CARE has been seeking information from BAPL to monitor the rating
vide e-mail communications/letters dated June 2, 2020, June 4,
2020, June 5, 2020 and numerous phone calls. However, despite
CARE's repeated requests, the Company has not provided the
requisite information for monitoring the ratings. In line with the
extant SEBI guidelines, CARE has reviewed the rating on the basis
of the publicly available information which, however, in CARE's
opinion is not sufficient to arrive at a fair rating. The rating of
BAPL's bank facilities will now be denoted as CARE B; Stable;
ISSUER NOT COOPERATING. Further, the banker could not be
contacted.
Users of this rating (including investors, lenders and the public
at large) are hence requested to exercise caution while using the
above rating.
The rating takes into account the company's nascent stage of
operations, highly competitive and fragmented industry, volatility
of input prices, raw material availability risks coupled with
exposure to a highly price sensitive consumer segment. However, the
aforesaid constraints are partially offset by its experienced
promoters.
Detailed description of the key rating drivers
* Small scale of operations with low profitability margins: The
scale of operation of company remain small marked by total
operating income (TOI) was INR82.62 Crore in FY19 (INR78.47 Core in
FY18).The PBILDT margin and PAT margin continues to be low with the
same remaining at 3.60% and 0.73 % respectively.
* Highly competitive & fragmented industry: The animal feed
industry is highly competitive and fragmented with many regional
unorganized players. BAPL is expected to face severe competition
from unorganized players apart from availability of cheaper
substitutes exposing it to pricing and profitability pressures.
* Volatile input prices and raw material availability risks coupled
with exposure to a highly price sensitive consumer Segment: The
prices of major inputs like soya feed, maize, mustered oil cake,
etc. are mostly agricultural products and dependent on vagaries of
nature. Accordingly, any volatility in input prices due to vagaries
of nature may adversely affect the profitability of the company.
Moreover there may be a negative impact of adverse climate
conditions on the availability of raw materials. The finished
products of BAPL will mainly be consumed by the poultry farms, who
are highly price sensitive which also forces the company to sell
their products at a relatively lower price other than because of
competition.
Key Rating Strengths
* Experienced promoters: BAPL is managed by Mr Rajesh Bhandari
(Director), having close to two decades of experience in the animal
feed industry. The day to day operations of the company are looked
after by Mr Rajesh Bhandari with the help of other directors and a
team of experienced personnel.
Bhandari Agrofeeds Private Limited (BAPL) was incorporated on
February 21, 2014 to set up a unit for manufacturing on
animal and cattle feeds at Uluberia, Howrah. The unit has started
commercial operations from October 2016.The day-today affairs of
the company are looked after by Mr Rajesh Bhandari (Managing
Director) along with the help of other directors and a team of
experienced personnel.
BRITTO AMUSEMENTS: Ind-Ra Cuts LT Issuer Rating to BB+, Non-coop.
-----------------------------------------------------------------
India Ratings and Research (Ind-Ra) has downgraded Britto
Amusements Private Limited's Long-Term Issuer Rating to 'IND BB+'
from 'IND BBB-' and has simultaneously migrated the rating to the
non-cooperating category. The Outlook was Stable. The issuer did
not participate in the surveillance exercise despite continuous
requests and follow-ups by the agency. Thus, the rating is based on
the best available information. Therefore, investors and other
users are advised to take appropriate caution while using the
ratings. The rating will now appear as 'IND BB+ (ISSUER NOT
COOPERATING)' on the agency's website.
The instrument-wise rating actions are:
-- INR180 mil. Fund-based limits downgraded and migrated to non-
cooperating category with IND BB+ (ISSUER NOT COOPERATING) /
IND A4+ (ISSUER NOT COOPERATING) rating.
Note: ISSUER NOT COOPERATING: Issuer did not cooperate; based on
the best available information
KEY RATING DRIVERS
The downgrade reflects Ind-Ra's expectations of deterioration in
the company's operating and financial profile in FY21 on account of
operational disruptions in the casinos and hotel sector due to the
COVID-19 led lockdown.
The ratings reflect BAPL's continued small scale of operations, as
indicated by revenue of INR587 million in FY20 (FY19: INR384
million). The numbers for FY20 are provisional in nature.
The ratings are supported by the healthy EBITDA margins. The margin
increased to 62.8% in FY20 (FY19: 37.2%) owing to the increase in
revenue. The return on capital employed was 30% in FY19 (FY18:
31%).
The ratings are also supported by the strong credit metrics. The
metrics improved in FY20 due to an increase in the absolute EBITDA
to INR368 million (FY19: INR143 million). The gross interest
coverage (operating EBITDA/gross interest expense) was 23.0x in
FY20 (FY19: 5.9x) and the net leverage (adjusted net debt/operating
EBITDA) was 0.02x (0.2x) BAPL has availed the Reserve Bank of
India-prescribed debt moratorium till August 2020.
The ratings have been migrated to the non-cooperating category as
the company has not provided information about the working capital
utilization, revised projections, sanction letters and updated
management certificate despite continuous requests and follow-ups.
COMPANY PROFILE
BAPL was incorporated in 1997 and it commenced operations from
2004. The company is headed by Dr. William Britto, who owns and
operates a five star hotel named Chances Resort and Casino at Dona
Paula in Goa.
CHETAN ALLOYS: CARE Cuts Rating on INR10cr LT Loan to C, Not Coop.
------------------------------------------------------------------
CARE Ratings revised the ratings on certain bank facilities of
Chetan Alloys Private Limited (CAPL), as:
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long-term Bank 10.00 CARE C; Issuer not cooperating;
Facilities Revised from CARE B-; Based on
best available information
Detailed Rationale & Key Rating Drivers
CARE had, vide its press release dated August 05, 2019, placed the
rating(s) of CAPL under the 'issuer non-cooperating' category as
CAPL had failed to provide information for monitoring of the
rating. CAPL continues to be non-cooperative despite repeated
requests for submission of information through e-mails, phone calls
and a letter/email dated April 6, 2020, May 28, 2020,
June 1, 2020 and June 3, 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 assigned to the bank facilities of CAPL have been
revised on account of non-availability of latest financial and
operational information as well as CARE's inability to carry out
due diligence exercise with lenders along with losses reported
in FY19.
The ratings are constrained on account of modest scale of
operations, leveraged capital structure, weak debt coverage
indicators CAPL's presence in highly competitive metal industry and
susceptibility to cyclicality of the metal industry. The ratings
derived comfort from healthy experience of directors and strong
relationships with customers and suppliers.
Detailed description of the key rating drivers
At the time of last rating on August 05, 2019 the following were
the rating strengths and weaknesses: (Updated for the information
available from Registrar of Companies):
Key Rating Weaknesses
* Modest scale of operations in FY19: CAPL has registered TOI of
INR29.86 crore during FY19 which was largely in line with that of
FY18. However, operating margin has declined by more than 200bps at
1.97% in FY19 as against 4.21% in FY18 mainly on account of higher
material cost. Further, CAPL also registered net losses during
FY19.
* Leveraged capital structure and weak debt coverage indicators: As
on March 31, 2019, Capital Structure of CAPL continues to remain
leveraged marked by overall gearing ratio at 2.16 times
as against 2.12 times as on March 31, 2018. Debt coverage
indicators also remained weak in FY19.
* Presence in highly competitive metal industry: CAPL operates in
highly competitive and open market of metal industry marked by
large number of medium sized players. The industry is
characterized by low entry barrier due to negligible government
policy restrictions, no inherent resource requirement constraints
and easy access to customers and supplier. Also, the presence of
big sized players with established marketing & distribution network
results into intense competition in the industry.
* Susceptible to cyclicality of the metal industry: Prospects of
the metal industry are strongly co-related to economic cycles and
sensitive to trends of various industries such as automotive,
construction, infrastructure, cement, etc. which the key consumers
are of metal products. These key user industries in turn depend on
macroeconomic factors, such as consumer confidence, employment
rates, interest rates, etc. in which, they sell their products.
Downturns in these economies affect the metal industry which may
lead to decrease in metal prices putting pressure on the entire
value chain.
Key Rating Strengths
* Experienced promoters and healthy relationship with customers and
suppliers: Mr. Chetan Maheshwari and Mr. Satish Maheshwari are
well-experienced in metal industry and are responsible for entire
business operations for the company. Also all the promoters
maintain healthy relationship with its customer and suppliers and
capitalize their experience in maintaining the same.
Chetan Alloys Private Limited (CAPL) was incorporated in May 2011
by Mr.Chetan Maheshwari and Satish Maheshwari and commercial
operations commenced from October 2012. Business of group entity,
ShekharImpex, where Mr.Sureshbhai Maheshwari was proprietor, was
transferred to CAPL in 2011. CAPL has its Head office in Delhi and
Branch office at Jamnagar. It deals in the scrap products of
ferrous metals and non-ferrous metals like aluminum, bronze, zinc,
titanium etc. CAPL obtains sales orders from its customers and
procures the products from prime suppliers of India.
CORE JEWELLERY: Ind-Ra Lowers Long Term Issuer Rating to D
----------------------------------------------------------
India Ratings and Research (Ind-Ra) has downgraded Core Jewellery
Private Limited's (CJPL) Long-Term Issuer Rating to 'IND D' from
'IND BB (ISSUER NOT COOPERATING)'.
The instrument-wise rating actions are:
-- INR503 mil. (increased from INR450 mil.) Fund-based working
capital facilities (Long-term/Short-term) downgraded with
IND D rating; and
-- INR57 mil. (reduced from INR110 mil.) Term loan (Long-term)
due on December 2022 downgraded with IND D rating.
KEY RATING DRIVERS
The downgrade reflects instances of delays in CJPL's term loan
repayments (both interest and principal) during the six months
ended May 2020 due to liquidity constraints.
RATING SENSITIVITIES
Positive: Timely debt servicing for three consecutive months will
be positive for the ratings.
COMPANY PROFILE
Incorporated in 1999, Mumbai-based CJPL manufactures and exports
diamond-studded gold jewellery.
DEV INDIA: CARE Cuts INR8.37cr LT Loan Rating to B, Not Coop.
-------------------------------------------------------------
CARE Ratings revised the ratings on certain bank facilities of Dev
India Projects Private Limited (DIPPL), as:
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long-term Bank 8.37 CARE B; Stable, Issuer not
Facilities cooperating; Revised from
CARE B+; Stable; on the basis
of best available information
Detailed Rationale & Key Rating Drivers
CARE has been seeking information from DIPPL to monitor the rating
vide e-mail communications/letters dated June 1, 2020, June 2,
2020, June 3, 2020 and numerous phone calls. However, despite
CARE's repeated requests, the Company has not provided the
requisite information for monitoring the rating. In line with the
extant SEBI guidelines, CARE has reviewed the rating on the basis
of the publicly available information which, however, in CARE's
opinion is not sufficient to arrive at a fair rating. The rating of
DIPPL's bank facilities will now be denoted as CARE B; Stable;
ISSUER NOT COOPERATING. Further, the banker could not be
contacted.
Users of this rating (including investors, lenders and the public
at large) are hence requested to exercise caution while using the
above rating.
The rating takes into account modest scale of operation with thin
profit margins, risk of non-renewal of distributorship agreement,
Pricing constraints and margin pressure arising out of competition
from other distributors in the market, working capital intensive
nature of operations leading to Leveraged capital structure and
moderate debt protection metrics. However, the rating continues to
derive strengths by the experienced promoters.
Detailed description of the key rating drivers
Key Rating Weaknesses
* Modest scale of operation with thin profit margins: The scale of
operations remained small as compared to its peers with a PAT of
INR0.36 crore on total operating income of INR43.07 crore during
FY19. The profit margin of the company remained low marked by
operating margin of 3.71% and PAT margin of 0.84% in FY19.
* Risk of non-renewal of distributorship agreement: Dev India
Projects Private Limited (DIPL) has entered into a sole
distributorship agreement with Samsung India Electronics Private
Limited (SIEPL) for the entire districts of north Bihar for home
appliance products.
* Pricing constraints and margin pressure arising out of
competition from other distributors in the market: The industry is
highly fragmented in nature with low entry barriers due to minimal
capital required and easy access to clients and suppliers. DIPL is
not facing competition from same brand as it is the sole
distributor of SIEPL for north Bihar. However, there are large
numbers of players of other brands, involved in the trading of home
appliances electronics products in the region, which is putting up
intense competition to the DIPL.
* Working capital intensive nature of operations leading to
leveraged capital structure and moderate debt protection metrics:
The operations of the company remained working capital intensive as
the company maintains inventory of around a month. The capital
structure of the company remained leveraged owing to its working
capital intensive nature of operations leading to high dependence
on bank borrowings marked by the overall gearing of 2.42x as on
March 31, 2019. Interest coverage ratio remained moderate at 1.64x
in FY19. Total debt to CGA remained high at 20.21x as on March 31,
2019. The current ratio remained low at 1.26x as on March 31,
2019.
Key Rating Strengths
* Experienced promoters: Promoters and experienced management
manage the day to day operation of the company.
Dev India Projects Private Limited (DIPPL) was incorporated on
March 9, 2009 by Ms. Kumari Aarty, Mr. Mukesh Kumar Mehta and Mr.
Gopal Mehta of Muzaffarpur, Bihar. Since its inception, DIPPL has
been engaged in the business of distributorship of home appliances
of Samsung India Electronics Private Ltd (SIEPL). The company is
the sole distributor of SIEPL for the fifteen districts of Bihar.
DIPPL sells its products to dealers (currently 150 dealers) and
retailers (75) in the districts like Chhapra, Siwan, Gopalganj,
Mirganj, Hajipur, Darbhanga, Madhubani, Jaynagar, Muzaffarpur,
Sitamarhi, Motihari, Bettiah, Rexaul, Bagha and Balmikinagar.
Currently, the company is managed by Mr. Rajeev Ranjan and Mr.
Manish Raj who are having about seven years of experience in
distributorship business of home appliances.
DR. M N TANDON: CARE Cuts Rating on INR4.26cr Loan to B, Not Coop.
------------------------------------------------------------------
CARE Ratings revised the ratings on certain bank facilities of Dr.
M N Tandon Memorial Charitable Trust (DMN), as:
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long-term Bank 4.26 CARE B; Stable, Issuer not
Facilities cooperating; Revised from
CARE B+; Stable; on the basis
of best available information
Detailed Rationale & Key Rating Drivers
CARE had, vide its press release dated March 25, 2019, placed the
rating(s) of DMN under the 'issuer non-cooperating' category as DMN
had failed to provide information for monitoring of the rating as
agreed to in its Rating Agreement. DMN continues to be
non-cooperative despite repeated requests for submission of
information through e-mails, phone calls and letter dated May 21,
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
ratings.
Users of this rating (including investors, lenders and the public
at large) are hence requested to exercise caution while using the
above rating(s).
The rating assigned to the bank facilities of DMN have been revised
on account of non-availability of requisite information. The rating
continue to remain constrained on account of its financial risk
profile marked by net loss in FY18 (FY refers to the period April 1
to March 31), leveraged capital structure and stressed liquidity
position. The rating is, further, constrained on account of
reputational risk and its presence in the highly regulated and
competitive healthcare industry.
The ratings, however, continue to favorably take into account
takeover of operations by experienced management in May 2017 in the
hospital industry with continuous infusion of funds in the trust
and Hospital having experienced staff along with diversified
revenue stream attributing growth in scale of operations.
Detailed description of the key rating drivers
At the time of last rating on March 25, 2019 the following were the
rating strengths and weaknesses (Updated for the information
available from client)
Key Rating Weaknesses
* Financial risk profile marked by net loss, leveraged capital
structure and stressed liquidity position: Operating margin of the
company stood healthy at 12.73% in FY18 and improved from operating
loss in FY17. Further, trust remained in net loss level at INR1.03
crore as against INR5.03 corre in FY17; however, GCA level of the
trust has improved significantly and registered cash profit of
INR1.28 crore in FY18 as against cash loss of INR2.17 crore in
FY17. The net-worth base of the trust remained negative attributing
negative capital structure of the trust. The debt coverage
indicators of the trust have improved from negative total debt to
GCA of 8.68 times in FY17 to positive total debt to GCA of 14.54
times in FY18. The liquidity position stood stressed with below
unity level of current and quick ratio as on March 31, 2018.
* Reputational risk along with Fragmented nature of industry
leading to high competition with vigilant regulatory bodies:
Healthcare is a highly sensitive sector where any mishandling of a
case or negligence on part of any doctor and/or staff of the unit
can lead to distrust among the masses. Thus, all the healthcare
providers need to monitor each case diligently and maintain
standard of services in order to avoid the occurrence of any
unforeseen incident. They also need to maintain high vigilance to
avoid any malpractice at any pocket. The healthcare sector is
highly fragmented with few players in the organized sector. Barring
a few, most of the organized sector players have one or two
hospitals only. All these lead to high level of competition in the
business. Further, healthcare sector is highly regulated and kept
under the close vigilance of various regulatory bodies in India
like, Ministry of Health & Family Welfare, Central Drug Standard
Control Organization etc.
Key Rating Strengths
* Takeover of operations by experienced management in May'17 in the
hospital industry with continuous infusion of funds in the trust:
Dr. M N Tandon Memorial Charitable Trust (DMN) was formed in 2012
by Mrs. Maya Tandon wife of Dr. M.N Tandon along with a group of
practicing medical consultants to operate a critical care unit.
However, in May, 2016, trustees have changed and start operating a
multi and super specialty hospital, under the name of "Jeevan Rekha
Critical Care and Trauma Hospital". The management of hospital has
vast experience in the same line of business and is well qualified.
Mrs Richa Gupta, Ms. Rangoli Mathur, trustees has vast experience
in the field of reproductive medicine and technologies. Ms. Hemlata
Patidar, Diploma in Gynecology, also have 2 decades of experience
in the industry and have handled several cases in the field.
Further, trustees of the hospital are assisted by well qualified
doctors, consultants and second tier management. Dr Neeraj Agarwal,
Dr. Lalit Sharma, Dr Saurabh Mathur, Dr. Ram Chitlangia, Dr. SP
Patidar, Dr. Saket Agrawal, Dr. Pradeep Singhal are well known
doctors in Jaipur who provides consultancy in the trust. Further,
the promoters of the trust are continuously infusing unsecured
loans to support its operations and to meet working capital
requirements. The promoters have infused INR6.53 crore and INR0.45
crore in FY17 and FY18 respectively.
* Hospital having experienced staff along with diversified revenue
stream attributing growth in scale of operations: The hospital is
running multi-specialty hospital and offers services in orthopedic,
neurology, cardiology, gastroenterology, gynecology, general
surgery, general medicine, dermatology, urology, nephrology, ENT,
critical care, radiology, pathology and micro logy. The hospital is
a 150 bed multispecialty hospital and the occupancy rate of the
hospital remained moderately healthy at 50%in last three financial
years ended FY17. Further, the hospital is located in the area
where middle and lower class people are present. The hospital
provides its services to all income groups. The hospital has well
qualified and experienced 20 in-house doctors, 25 visiting doctors,
55 nursing staff and 50 supporting staff with doctor's average
experience of 10 years. However, occupancy rate stood moderate at
50 in FY17. During FY18, Total Operating Income of the trust has
increased significantly by 102% over FY17 and registered INR17.13
crore.
DMN was formed in 2012 by Mrs. Maya Tandon wife of Dr. M.N Tandon
along with a group of practicing medical consultants to operate a
critical care unit. However, in May, 2016, trustees have changed
and start operating a multi and super specialty hospital, under the
name of "Jeevan Rekha Critical Care and Trauma Hospital" at Jaipur
having 150 beds which includes general wards, private rooms and
Intensive-Care Units (ICU) etc. The hospital provides specialized
services related to various medical specialties viz. orthopedic,
neurology, cardiology, gastroenterology, gynecology, general
surgery, general medicine, dermatology, urology, nephrology, ENT,
critical care, radiology, pathology and micrology.
FIREFLY BATTERIES: CARE Keeps D Debt Ratings in Not Cooperating
---------------------------------------------------------------
CARE Ratings said the rating for the bank facilities of Firefly
Batteries Private Limited (FBPL) continues to remain in the 'Issuer
Not Cooperating' category.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long term Bank 23.00 CARE D; Issuer not cooperating;
Facilities Based on best available
information
Long-term/ 8.70 CARE D/CARE D; Issuer Not
Short-term Cooperating; on the basis of
Bank Facilities Best available information
Detailed Rationale & Key Rating Drivers
CARE had, vide its press release dated July 3, 2019, placed the
rating(s) of FBPL under the 'issuer non-cooperating' category as
FBPL had failed to provide information for monitoring of the
rating. FBPL continues to be non-cooperative despite repeated
requests for submission of information through e-mails, phone calls
and a letter/email dated April 6, 2020, May 28, 2020,
June 1, 2020 and June 3, 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
At the time of last rating on July 3, 2019 the following was the
rating weaknesses:
Key Rating Weaknesses
* On-going delay in debt servicing: Owing to weak liquidity
position, there are on-going delays in debt servicing.
Ahmedabad (Gujarat) based, FBPL was established in the year 2011 as
a private limited company. FBPL (erstwhile known as Epsilon
Batteries Private Limited) is engaged in the manufacturing of
conventional lead-acid battery & carbon-foam battery with an
installed capacity of 300,000 KWH storage batteries per annum.
These batteries find application in automobile industry, renewable
energy and industrial sector such as telecom and hospitality. FBPL
is managed by experienced directors Mr. Jinal Shah & Mr. B.K.
Vaishya.
IL&FS ENERGY: CARE Keeps D Debt Ratings in Not Cooperating
----------------------------------------------------------
CARE Ratings said the rating for the bank facilities of IL&FS
Energy Development Company Limited (IEDCL) continues to remain in
the 'Issuer Not Cooperating' category.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long term Bank 1137.85 CARE D; Issuer not cooperating;
Facilities Based on best available
information
Non-Convertible 900.00 CARE D; Issuer Not Cooperating;
Debentures Based on best available
Information
Proposed Non- 100.00 CARE D; Issuer Not Cooperating;
Convertible Based on best available
Debentures Information
Long Term-Inter 100.00 CARE D; Issuer Not Cooperating;
Corporate Deposit Based on best available
(ICD) Issue Information
Detailed Rationale & Key Rating Drivers
CARE had, vide its press release dated March 27, 2019, placed the
rating(s) of IL&FS Energy Development Company Limited (IEDCL) under
the 'issuer non-cooperating' category as IEDCL had failed to
provide information for monitoring of the rating and had not paid
the surveillance fees for the rating exercise as agreed to in its
Rating Agreement. IEDCL continues to be noncooperative despite
repeated requests for submission of information through e-mails,
phone calls and a letter/email dated June 1, 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
At the time of last rating on March 27, 2019 the following were the
rating strengths and weaknesses
Key Rating Weaknesses
* Delay in debt-servicing obligations: Delays and defaults on
IEDCL's principle and interest payment continue. The same has been
confirmed by lender to CARE, as part of its due diligence exercise.
CARE has also not received NDS since September 2018.
IEDCL is a subsidiary of Infrastructure Leasing & Financial
Services Limited (IL&FS, rated CARE D; holds 91.42% stake) is into
power generation business through conventional and non-conventional
energy sources. At consolidated level, as on June 30, 2018 the
operational capacity of the company is around 2,803.50 MW.
IL&FS TAMIL: CARE Keeps D INR5584.93cr Debt Rating in Not Coop.
---------------------------------------------------------------
CARE Ratings said the rating for the bank facilities of IL&FS Tamil
Nadu Power Company Limited (ITNPL) continues to remain in the
'Issuer Not Cooperating' category.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long term Fund 5584.93 CARE D; Issuer not cooperating;
Based Facilities Based on best available
information
Detailed Rationale & Key Rating Drivers
CARE had, vide its press release dated March 27, 2019, placed the
rating(s) of ITNPL under the 'issuer non-cooperating' category as
ITNPL had failed to provide information for monitoring of the
rating and had not paid the surveillance fees for the rating
exercise as agreed to in its Rating Agreement. ITNPL continues to
be noncooperative despite repeated requests for submission of
information through e-mails, phone calls and a letter/email dated
June 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 rating(s).
Detailed description of the key rating drivers
At the time of last rating on April 04, 2019 the following were the
rating strengths and weaknesses
Key Rating Weaknesses
* Delay in servicing of debt obligations: ITNPL has not serviced
its debt obligations for the past couple of months. The same has
been confirmed by CARE as part of its due diligence exercise. CARE
has also not received No Default Statement since the month ended
November 2018.
ITNPL is a Special Purpose Vehicle (SPV) promoted by IL&FS Energy
Development Company Ltd. (IEDCL, rated CARE D; Issuer Not
Cooperating holds 91.38% stake). The company has set-up 1,200 MW
(2X600 MW) integrated imported coal-based subcritical thermal power
plant in Cuddalore, Tamil Nadu. The total project cost incurred for
the first phase (1,200MW) is around INR10,640 crore (which was
originally estimated at INR6,371 crore (including cost of
development of captive port and investment in coal mine in
Indonesia)). The project was funded through term loan of INR6,080
crore and equity of INR4,560 crore. The Unit-I (600MW) and Unit-II
(600MW) achieved Commercial Operation Date (CoD) on September 29,
2015 and on April 30, 2016, respectively.
INDIA DAIRY: CARE Cuts Rating on INR15cr LT Loan to B, Not Coop.
----------------------------------------------------------------
CARE Ratings revised the ratings on certain bank facilities of
India Dairy Feeds Private Limited (IDFPL), as:
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long-term Bank 15.00 CARE B; Stable, Issuer not
Facilities cooperating; Revised from
CARE B+; Stable; on the basis
of best available information
Detailed Rationale & Key Rating Drivers
CARE has been seeking information from IDFPL to monitor the ratings
vide e-mail communications/letters dated June 1, 2020, June 2,
2020, June 3, 2020 and numerous phone calls. However, despite
CARE's repeated requests, the Company has not provided the
requisite information for monitoring the rating. In line with the
extant SEBI guidelines, CARE has reviewed the rating on the basis
of the publicly available information which, however, in CARE's
opinion is not sufficient to arrive at a fair rating. The rating on
IDFPL's bank facilities will now be denoted as CARE B; Stable/ CARE
A4; ISSUER NOT COOPERATING. Further, the banker could not be
contacted.
Users of this rating (including investors, lenders and the public
at large) are hence requested to exercise caution while using the
above rating.
The rating takes into account risk of non-renewal of agreement with
Kaira District Co-operative Milk Producers' Union Ltd, referred as
Amul Dairy, volatile input prices and raw material availability
risks, highly competitive and fragmented industry with many
regional unorganized players and leveraged capital structure with
moderate debt coverage indicators. The rating, however, continues
to draw comfort from its experienced promoters.
Detailed description of the key rating drivers
Key Rating Weaknesses:
* Risk of non-renewal of agreement with Kaira District Co-operative
Milk Producers' Union Ltd, referred as Amul Dairy: IDPL has
entered into authorized agreement with Kaira District Co-operative
Milk Producers' Union Ltd, referred as Amul Dairy in August, 2016
for a period of 5 years. Accordingly there is a risk involved
pertaining to renewal of the agreement. Further, the agreement may
be terminated on violation of certain clauses.
* Volatile input prices and raw material availability risks: The
prices of major inputs like DORB, maize, mustered oil cake, bajra
etc. are mostly agricultural products and dependent on vagaries of
nature. Accordingly, any volatility in input prices due to vagaries
of nature may adversely affect the profitability of the company.
Moreover there may be a negative impact of adverse climate
conditions on the availability of raw materials.
* Highly competitive and fragmented industry with many regional
unorganized players: The cattle feed industry is highly competitive
and fragmented with many regional unorganized players. IDPL is
expected to face severe competition from unorganized players apart
from availability of cheaper substitutes (like cotton seedcake,
copra etc.) exposing it to pricing and profitability pressures.
* Leveraged capital structure with moderate debt coverage
indicators: The capital structure of the company remained
leveraged marked by long term debt equity ratio and overall gearing
ratio of 2.24x and 3.33x respectively in FY19. However, the
interest coverage ratio of the company remained satisfactory at
4.36x in FY19.
Key Rating Strengths
* Experienced promoter: The promoters of IDPL are Shri Anirban
Nath (ICWAI Inter), Smt. Susmita Nath (Graduate) and Shri Surajit
Chakravarti (Post Graduate). Shri Anirban Nath (Managing Director)
aged about 47 years has more than two decades of experience in
similar line of business and is involved in the strategic planning
and running the day to day operations of the company. He is being
duly supported by other directors along with a team of experienced
professionals.
India Dairy Feeds Private Limited (IDPL), incorporated in the year
2014 was promoted by Shri Anirban Nath, Smt. Susmita Nath and Shri
Surajit Chakravarti of Kolkata. IDPL set up a unit engaged in
manufacturing of cattle feed at Bankura, West Bengal with installed
capacity of 30000 MTPA. IDPL has entered into authorized agreement
with Kaira District Cooperative Milk Producers' Union Ltd, referred
as Amul Dairy in August, 2016 for a period of 5 years, whereby Amul
Dairy will obtain cattle feed of different types produced by IDPL,
packed in HDPE bags or in different pack sizes as decided by Amul
Dairy, with the objective of marketing the cattle feed under 'Amul'
brand in Kolkata and other markets in the eastern region as decided
by Amul dairy. Shri Anirban Nath, the Managing Director, looks
after the day to day operations of the entity along with a team of
experienced personnel.
INDSUR GLOBAL: CARE Keeps D Debt Ratings in Not Cooperating
-----------------------------------------------------------
CARE Ratings said the rating for the bank facilities of Indsur
Global Limited (IGL) continues to remain in the 'Issuer Not
Cooperating' category.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long term Bank 21.49 CARE D; Issuer not cooperating;
Facilities Based on best available
information
Long/Short term 23.50 CARE D; Issuer not cooperating;
Bank Facilities Based on best available
information
Detailed Rationale & Key Rating Drivers
CARE had, vide its press release dated March 22, 2019, placed the
rating(s) of IGL under the 'issuer non-cooperating' category as
Indsur Global Limited had failed to provide information for
monitoring of the rating. Indsur Global Limited continues to be
non-cooperative despite repeated requests for submission of
information through e-mails, phone calls and a letter dated
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 it 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 taken into account the delays in debt
servicing with significant deterioration in financial risk profile
of the company marked by decline in scale of operations with net
loss incurred in FY18 over FY17, deterioration in capital
structure and debt coverage indicators and elongation in working
capital cycle led to stretch liquidity position.
Detailed description of the key rating drivers
At the time of last rating on March 22, 2019, the following were
the rating strengths and weaknesses.
Key rating Weakness
* Delay in servicing debt obligation: As per banker interaction,
there are ongoing delays in serving of debt obligation and the
account is classified as NPA.
* Decline in scale of operations: During FY18, total operating
income of IGL remained at INR59.11 crore as compared to INR75.93
crore in FY17. Overall scale of operations continues to remain at
modest level.
* Losses incurred in FY18: IGL incurred operating loss of INR1.04
crore in FY18 vis-a-vis operating profit of INR11.05 crore.
Further, with the losses at PBILDT level company incurred net loss
of INR10.86 crore in FY18 vis-a-vis INRNet profit INR0.05 crore in
FY17.
* Deterioration in capital structure and debt coverage indicators:
IGL's overall gearing deteriorated to 4.00x as on March 31, 2018
(vis-Ã -vis 2.07x as on March 31, 2017) due deterioration in net
worth base due to losses incurred in FY18. Further debt coverage
indicators are marked by deterioration in total debt to GCA and
interest coverage ratio due to losses incurred along with negative
gross cash accruals in FY18.
* Elongation in working capital cycle: During FY18, working capital
cycle elongated to 2014 days from 162 days in FY17 on account of
stretched collection period and inventory days as on March 31,
2018.
* Weak liquidity position: Liquidity position is marked by current
ratio remained at 1.34x in FY18 vis-Ã -vis 1.38x in FY17. Further
cash and bank balance also declined to INR0.01 crore in FY18
vis-Ã -vis INR0.08 crore in FY17.
* Customer concentration risk: During FY17, the top 5 customers of
IGL contributed ~79% of its total sales (vis-Ã -vis ~85% in FY16)
and out of top 5 customers, top 2 continued to contribute more than
60% to the total sales in FY17 therefore concentration risk remains
in the business. However the company's revenues are not confined to
single location and are spread across domestic and overseas
countries such as USA, Germany, Slovakia and UAE. Furthermore some
comfort can be drawn from the fact that IGL has long standing
business relation with established players in the insulator
industry.
* Further delay in project execution: IGL is undergoing with
capacity expansion and modernization of its existing plant located
in Halol, Gujarat. The project is expected to complete by April
2018 as against earlier envisaged date of December 2017. The delay
was due to delay in banking procedures. As on January 2018, ~90% of
the project is completed and cost is being funded through term loan
and through unsecured loan from promoters and relatives. Ability of
the company to timely complete the project and effectively utilize
its enhanced capacity and thereby improve its profit margins on
account of operational efficiency shall be critical from credit
perspective.
* Exposure to raw material price volatility and foreign exchange
rate fluctuation: Purchase of raw material has been the major
component in cost structure which contributed ~80% in FY18
(vis-Ã -vis 70% in FY17) and raw material required for
manufacturing process is cold rolled coil (CRC), steel scrap, etc.
the prices of which have shown fluctuations during the past years
due to volatility in the global commodity markets. However, the
company sources its entire raw material requirement from the
domestic markets (i.e. Gujarat) and due to its long standing
business relations with its key customers; it has so far been able
to pass on increase in raw material prices to its customers to a
large extent. Further IGL earns approximately 20% (as against 23%
in FY16) of its revenues from exports which is entirely un-hedged
thereby leading to the risk of exchange rate fluctuation. However,
the company imports of raw material CRP scrap from Brazil which
provides natural hedging to an extent.
Key Rating Strengths
* Experienced management and their financial support in the past:
IGL (part of Indsur group – engaged in manufacturing of iron &
steel casting through various ventures) with a presence of around
two decades; is entirely operated and managed by the Lodha family
since 2004. The key promoters of the company are professional and
well experienced with Mr. Sureshmal Lodha (having four decades of
experience) and Mr. Amit Lodha (a CA, CPA with more than a decade
of experience) along with Mr. Ankur Lodha (an MBA with more than a
decade of experience) who took over the loss making business from
Aditya Birla group and has been instrumental in transforming the
business. The promoters are well supported by the experienced and
qualified management personnel. Moreover, the promoters have been
supporting the entity through infusion of funds in the past.
* Various quality certifications: IGL has continuously undertaken
expansion, modernization and automation of its plant during past
four years and has developed well-structured manufacturing
facilities with quality management system as it is an ISO
16949:2009 and 9001:2008 certified unit. The company has also
received ISO 14001:2004 certification for sound environmental
management system with regards to manufacturing of SG and CI
castings for engineering and automotive applications.
Incorporated in 1994, Indsur Global Limited (IGL) [formerly known
as HGI Foundries – unit of Aditya Birla group located in Halol,
Gujarat] is a closely held company taken over by Indsur group in
the year 2004. Currently, the company is engaged in the business of
manufacturing of insulator and auto castings, with insulator
castings contributing The company generates majority of its revenue
from the domestic market and exports formed approximately 20% of
the revenue base (during FY17) mainly to USA and Germany.
MAPLE PANELS: Ind-Ra Cuts LT Issuer Rating to BB+, Not Coop.
------------------------------------------------------------
India Ratings and Research (Ind-Ra) has downgraded Maple Panels
Private Limited's (MPPL) Long-Term Issuer Rating to 'IND BB+' from
'IND BBB-' and has simultaneously migrated 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. Thus, the rating is based on the best
available information. Therefore, investors and other users are
advised to take appropriate caution while using these ratings. The
rating will now appear as 'IND BB+ (ISSUER NOT COOPERATING)' on the
agency's website.
The instrument-wise rating actions are:
-- INR139.39 mil. Long-term loan due on June 2024 downgraded and
migrated to non-cooperation category with IND BB+ (ISSUER NOT
COOPERATING) rating;
-- INR75.00 mil. Fund-based limits downgraded and migrated to
non-cooperation category with IND BB+ (ISSUER NOT
COOPERATING) rating; and
-- INR10.00 mil. Non-fund-based limits downgraded and migrated to
non-cooperation category with IND A4+ (ISSUER NOT
COOPERATING) rating.
Note: ISSUER NOT COOPERATING: The ratings were last reviewed on 10
April 2019. Ind-Ra is unable to provide an update, as the agency
does not have adequate information to review the ratings.
KEY RATING DRIVERS
The downgrade reflects the deterioration in MPPL's financial
performance in FY19. The revenue declined to INR597.09 million in
FY19 (FY18: INR624.93 million). Furthermore, the MPPL's credit
metrics deteriorated in FY19 owing to a decline in the absolute
EBITDA to INR74.89 million (FY18: INR106.07 million). The interest
coverage ratio (operating EBITDA/gross interest expense) was 2.72x
in FY19 (FY18: 3.23x) and the net financial leverage (total
adjusted net debt/operating EBITDA) was 3.94x (2.57x).
MPPL did not participate in the surveillance exercise and has not
provided information about bank utilization, future plans and
performance of its group companies, among others.
RATING SENSITIVITIES
Positive: A substantial improvement in the revenue and operating
profitability, leading to an improvement in the overall credit
metrics, will be positive for ratings.
Negative: Any decline in the revenue or EBITDA, leading to further
deterioration in the overall credit metrics, will be negative for
the ratings.
MUNICIPAL COUNCIL: CARE Keeps B Issuer Rating in Not Cooperating
----------------------------------------------------------------
CARE Ratings said the Issuer Rating of CARE B (Is) of Municipal
Council Anantnag continues to remain in the 'Issuer Not
Cooperating' category.
CARE has been seeking information and NDS from the company to
monitor the ratings vide e-mail communications dated June 5, 2020,
June 2, 2020, May 25, 2020, May 18, 2020, May 8, 2020, April 30,
2020, March 31, 2020 and numerous phone calls. However, despite
CARE's repeated requests, the company has not provided the
requisite information for monitoring the ratings. In line with the
extant SEBI guidelines, CARE has reviewed the rating on the basis
of the best available information which however, in CARE's opinion
is not sufficient to arrive at a fair rating. The rating on MCA's
bank facilities will now be denoted as CARE B (Is); Stable; ISSUER
NOT COOPERATING.
Users of this rating (including investors, lenders and the public
at large) are hence requested to exercise caution while using the
above rating(s).
The ratings assigned to Municipal Council Anantnag remains
constrained by the fluctuating trend in the financials and revenue
receipts of the council in recent years. The Council has been
registering a revenue deficit during FY14-17 (refers to the period
April 1 to March 31). Additionally, it has low self-reliance and
higher dependence on grants, limited autonomy in
levying trade taxes and other user charges, increase in revenue
expenditure and limited number of economic activities. The rating
also derives comfort from zero debt position of the council.
Going forward, the key rating sensitivities for the council are
growth in revenue receipts, steady receipts from Directorate of
Urban Local Bodies (DULB), and improvement in its civic services.
Detailed description of the key rating drivers
At the time of last rating on March 25, 2019, following were the
rating strengths and weaknesses:
Key Rating Weaknesses
* Fluctuating Trend in Financials & Revenue Deficit: There is an
abrupt trend in the revenue receipts and revenue expenditure of the
council. The overall revenue receipts of the council have reported
a dip of 30% in FY17 after increasing by 67.5% in FY16.
Correspondingly Revenue expenditure has reported a dip of 22.4% in
FY17 after increasing by 62.5% in FY16. The reason for variation on
y-o-y basis is the heavy dependence of Grants from Directorate of
Urban Local Bodies (DULB). The council has reported revenue
deficits in last four years.
* Low Self-Reliance on Own Sources of Revenue: More than 80% of
revenues of the council are grants from DULB to meet the
establishment expenditure which is more than 75% of total
expenditure of the council.
* Limited Autonomy in Levying Trade Taxes and other User Charges:
Political considerations and low level of economic activities
affects the autonomy of council for levying trade taxes in the
state. Also, major civic services like Water Supply & Storm Water
Drainage are not covered under the services of the council which
further limits the source of revenue as user fees. There are no
revenues from Property Tax as same is not applicable in Jammu and
Kashmir. Only trade taxes income is being generated as tax
revenue.
* Limited Number of Economic Activities: The major sources of
economic activity in the region are the small scale cottage
industries engaged in activities like weaving, wood carving or
cultivation of agri commodities like rice, wheat & apples. Presence
of religious shrines promotes tourism in the district. However lack
of infrastructure or due to connectivity issues there are no
established industries in the region.
Key Rating Strengths
* Zero Debt Position: The Council has not raised any debt till
date.
Analytical Approach: Standalone.
CARE has relied on the audited financial statements provided by the
council for the year FY14 (A) - FY17 (A).
Municipal Council Anantnag was commissioned under Jammu & Kashmir
Municipal Act in the year 1937. It covers an area of 15.16 sq.km
and is divided into 25 administrative wards.
NANDAN BUILDCON: CARE Keeps D Debt Ratings in Not Cooperating
-------------------------------------------------------------
CARE Ratings said the rating for the bank facilities of Nandan
Buildcon Private Limited (NBPL) continues to remain in the 'Issuer
Not Cooperating' category.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long term Bank 103.76 CARE D; Issuer not cooperating;
Facilities Based on best available
information
Short 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 March 25, 2019, placed the
ratings of NBPL under the 'issuer non-cooperating' category as NBPL
had failed to provide information for monitoring of the rating as
agreed to in its Rating Agreement. NBPL continues to be
non-cooperative despite repeated requests for submission of
information through e-mails, dated June 3, 2020, June 5, 2020, June
9, 2020 and June 11, 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
At the time of last rating on March 25, 2019 the following was the
rating weakness (updated for the information available from
Registrar of Companies).
Key Rating Weakness
* Delays in debt servicing: As per the feedback received from the
bankers of NBPL there are delays in servicing of debt obligation on
account of stretched liquidity. Furthermore, as per audit report
for year ended March 31, 2019 the account is classified as NPA.
NBPL is a part of 'NANDAN' Group, engaged in the construction of
residential and commercial properties. Till date, the group has
completed 34 projects in Pune through various group entities (SPVs,
Partnership firms & AoP) with total saleable area admeasuring
approximately 33.93 lakh square feet (lsf.). Apart from NBPL,
Nandan group consists of Nandan Associates and Nandan VSP
Developers.
OM SAI: CARE Keeps D INR5.55cr Debt Rating in Not Cooperating
-------------------------------------------------------------
CARE Ratings said the rating for the bank facilities of Om Sai
Hospitality (OSH) continues to remain in the 'Issuer Not
Cooperating' category.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long term Bank 5.55 CARE D; Issuer not cooperating;
Facilities Based on best available
information
Detailed Rationale & Key Rating Drivers
CARE had, vide its press release dated June 28, 2019, placed the
rating(s) of OSH under the 'issuer noncooperating' category as Om
Sai Hospitality had failed to provide information for monitoring of
the rating. Om Sai Hospitality continues to be non-cooperative
despite repeated requests for submission of information through
e-mails, phone calls and a letter dated May 26, 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 June 26, 2019 the following were the
rating strengths and weaknesses:
Key rating Weakness
Delay in servicing of debt obligations: As per interaction with
banker, there are delays in servicing of debt obligations. Delays
have been due to stretched liquidity position due to irregular
payment received from its customers.
Key rating Strengths
* Experienced partners in the hospitality industry: The partners of
Om Sai Hospitality, Mr. Shekhar Shetty and Mr. Padmanabh Shetty
manage the day to day operations of the firm and have extensive
experience in the hotel & restaurant business. Mr. Shekhar Shetty
operates 'Hotel Priti', a Restaurant and Bar at Bhiwandi, in his
own capacity and Mr. Padmanabh Shetty is associated with the
Payyade Group of Hotels which operates around a dozen restaurants
in Western Mumbai. OSH is likely to benefit from the experience of
partners by way of improved services and better understanding
customer needs through the experience of the partners.
Established in the year 2012 by Mr. Shekhar Shetty and Mr.
Padmanabh Shetty, Om Sai Hospitality (OSH) is a partnership firm
engaged in the hospitality business and operates a 3-star hotel
"Dhiraj Hotel" at Thane. The hotel currently has 35 executive
deluxe rooms, 2 suite rooms and a banquet hall and provides
amenities such as WiFi, doctor on call, laundry service and valet
parking for its guests. The hotel mainly caters to corporate
customers and also leisure travellers looking for a budget hotel.
PARAMEX TRANSFORMERS: Insolvency Resolution Process Case Summary
----------------------------------------------------------------
Debtor: Paramex Transformers Limited
G-9, First Floor
Lawrance Road
Industrial Area
New Delhi 110035
Insolvency Commencement Date: June 17, 2020
Court: National Company Law Tribunal, New Delhi Bench
Estimated date of closure of
insolvency resolution process: December 14, 2020
Insolvency professional: Rajeev Lochan
Interim Resolution
Professional: Rajeev Lochan
243, 1st Floor
AGCR Enclave
New Delhi
E-mail: csrajeevlochan@gmail.com
- and -
1203, Vijaya Building
17, Barakhamba Road
Connaught Place
New Delhi 110001
E-mail: ip.paramex@gmail.com
Last date for
submission of claims: July 5, 2020
PROFIVE ENGINEERING: Ind-Ra Gives BB Issuer Rating, Outlook Stable
------------------------------------------------------------------
India Ratings and Research (Ind-Ra) has assigned Profive
Engineering Private Limited (PEPL) a Long-Term Issuer Rating of
'IND BB'. The Outlook is Stable.
The instrument-wise rating actions are:
-- INR35.708 mil. (outstanding as of April 30, 2020) Term loan
due on January 2026 assigned with IND BB/Stable rating; and
-- INR50 mil. Fund-based working capital limits assigned with
IND BB/Stable/IND A4+ rating.
KEY RATING DRIVERS
The ratings reflect PEPL's small scale of operations, as
highlighted by its low revenue base. The company's revenue rose 28%
yoy in FY19 to INR382 million, driven by a rise in the demand from
existing customers and new client acquisitions. Ind-Ra estimates
the company's FY20 revenue to have declined slightly, based on the
provisional FY20 revenue of INR363 million. The agency expects the
company's revenue to decline further in FY21 owing to the COVID-19
led lockdown. As of June 2020, the company had an outstanding order
book position of INR214 million with regular customers and project
orders, which provides modest short-term revenue visibility. FY20
financials are provisional in nature.
The ratings factor in the company's modest EBITDA margin, which
contracted to 7.6% in FY20 (FY19: 8%) due to an increase in the raw
material price. The company's return on capital employed stood at
10% in FY20 (FY19: 15%). During the three years ended FY20, the
company's margin has been volatile, ranging between 7.1% and 8.7%,
owing to fluctuating raw material prices.
The ratings are constrained by the company's moderate credit
metrics. In FY20, interest coverage (EBITDA/gross interest
coverage) deteriorated to 2.7x (FY19: 4.1x) due to a decline in the
absolute EBITDA to INR28 million (INR30.7 million). The net
leverage (total adjusted net debt/operating EBITDAR), however,
improved slightly to 3.4x in FY20 (FY19: 3.5x) on decrease in the
debt to INR104 million (INR112 million). Ind-Ra expects the
company's credit metrics to improve gradually as the company has no
major debt-led capex plans for the near term.
Liquidity Indicator - Stretched: PEPL's maximum fund-based working
capital limit utilization stood at 71.6% for the 12 months ended
May 2020. The net cash conversation cycle stretched to 90 days in
FY20 (FY19:76 days) due to an increase in the inventory days to 80
(76) and reduction in payable days to 70 (80). Resultantly, the
cash flow from operations turned negative to INR2 million in FY20
(FY19: INR4 million). The free cash flows turned positive to INR13
in FY20 (FY19: negative INR70 million) as the company didn't
undertake any major capex. Ind-Ra expects the company's free cash
flows to remain positive in FY21 in the absence of any major capex
plan. PEPL has availed of the Reserve Bank of India's moratorium on
its loans.
The ratings, however, are supported by PEPL's diversified customer
base with the top five customers contributing approximately 65% to
the revenue in FY20 (FY19: 75%). Furthermore, the company is
associated with a reputed customer and supplier base.
The ratings are further supported by the promoter's experience of
more than two-and-half decades of experience.
RATING SENSITIVITIES
Negative: A further stretch in the liquidity, along with a decline
in the revenue or EBITDA margin, resulting in a sustained
deterioration in the credit metrics, could lead to a negative
rating action.
Positive: An improvement in the revenue and EBITDA margin, leading
to improvement in the credit metrics on a sustained basis and the
liquidity position will be positive for the ratings.
COMPANY PROFILE
Incorporated in 2010, PEPL is managed by promoters Manik Daware,
Deepak Targe and Yogita Daware. PEPL is engaged in the
manufacturing of precision machine components, sheet metal,
components, fabricated components and assemblies surface treated
with shot blasting, painting and powder coating. The manufacturing
unit of the company is located in Chakan, Pune (Maharashtra).
QUADRANT TELEVENTURES: CARE Keeps D Debt Ratings in Not Coop
------------------------------------------------------------
CARE Ratings said the rating for the bank facilities of Quadrant
Televentures Limited (QTL) continues to remain in the 'Issuer Not
Cooperating' category.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long term Bank 17.22 CARE D; Issuer not cooperating;
Facilities Based on best available
information
Short term Bank 24.40 CARE D; Issuer not cooperating;
Facilities Based on best available
information
Detailed Rationale & Key Rating Drivers
CARE had, vide its press release dated February 26, 2019, placed
the rating(s) of QTL under the 'issuer non-cooperating' category as
QTL had failed to provide information for monitoring of the rating.
QTL continues to be non-cooperative despite repeated requests for
submission of information through e-mails, phone calls and an email
dated April 15, 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
At the time of last rating on February 26, 2019 the following were
the rating weaknesses (updated for the information available from
stock exchange):
Key Rating Weaknesses
* Ongoing delays in debt servicing: There are ongoing delays in the
servicing of the debt obligations by the company on account of its
weak liquidity position. The company has been classified as
Non-Performing Asset (NPA) by the bank.
* Financial risk profile marked by losses at the net level: The
total operating income of the company remained almost flat in FY19
(marginal increase of ~3%). However, due to high operational
expenses, the PBILDT margins declined to 0.11% in FY19 from 3.48%
in FY18. The company continued to remain in losses at the net
level, with a net loss of INR127.72 crore in FY19 (net loss of
INR300.64 crore in FY18). Due to losses at the net level, the
networth of the company remained negative. In 9MFY20 (Unaudited),
the total operating income of the company stood at INR355.28 cr.
(INR300.33 cr. in the same period last year) with a net loss of
INR105.01 cr. (net loss of INR97.73 cr. in the same period last
year).
* History of CDR: The debt of the Company was restructured under
Corporate Debt Restructuring (CDR) mechanism in March 4 and
subsequently in Jun-05. However, due to continued losses and
liquidity problems (at the time of launch of GSM services), QTL
again approached its lenders for rework of the earlier sanctioned
restructuring package, which was approved by CDR Empowered Group in
Aug-09, with cut-off date as April 1, 2009. In-line with the last
approved CDR terms, Videocon group was inducted as the new
strategic investor and subsequently a new management team was
setup.
* Deterioration in the financial risk profile of Videocon group
from which QTL derives operational and financial support: After
taking over the reins of the business of QTL in 2009, the Videocon
group has regularly supported the company to fund its capex and
other operational needs. The Videocon group, through its flagship
company-Videocon Industries Limited (VIL), has presence in varied
business verticals such as oil & gas, consumer electronics and
telecommunications. However, the financial risk profile of VIL has
deteriorated lately, with the company reporting net loss of
INR6760.76 crore on a total income of INR1062.61 crore in FY19 as
compared with net loss of INR5264.04 crore on a total income of
INR3350.12 crore in FY18, on a standalone basis.
Quadrant Televentures Limited (QTL) was incorporated in August 1946
by the name- The Investment Trust of India Limited (ITIL). The name
of the company was changed to HFCL Infotel Limited (HIL) in May
2003. In August 2009, the ownership of HIL was transferred to the
Videocon group, subsequent to which, the company was rechristened
as QTL. Currently, the Videocon group holds majority stake (49.47%)
in QTL through an entity promoted by it.
QTL is a Unified Access Services (UAS) Licensee in the Punjab
Telecom Circle comprising of the state of Punjab, Chandigarh and
Panchkula. The company started its operations as a fixed line
service provider under the brand name 'Connect' in the year 2000.
It was later granted UAS License in the Punjab Telecom Circle
(including Chandigarh and Panchkula) in 2003 subsequent to which it
launched its CDMA based mobile services under the brand name 'Ping'
(from September 2007) and GSM-based mobile services in March 2010.
Currently, QTL is providing Fixed Voice (Landline) services, DSL
(Internet) services, Leased Line services and CDMA Mobile Services
in the Punjab Telecom Circle (including Chandigarh and Panchkula).
The company discontinued its GSM business operations from February
15, 2017.
RELIANCE BROADCAST: CARE Reaffirms D Rating on INR83.69cr LT Loan
-----------------------------------------------------------------
CARE Ratings reaffirmed ratings on certain bank facilities of
Reliance Broadcast Network Limited (RBNL), as:
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long-term Bank 83.69 CARE D Removal of Issuer not
Facilities Cooperating (on the basis of
best available information);
and rating reaffirmed
Non-Convertible 66.80 CARE D Removal of Issuer not
Debenture issue Cooperating (on the basis of
(NCD-2) best available information);
and rating reaffirmed
Non-Convertible 50.00 CARE D Removal of Issuer not
Debenture issue Cooperating (on the basis of
(NCD-3) best available information);
and rating reaffirmed
Non-Convertible 65.00 CARE D Removal of Issuer not
Debenture issue Cooperating (on the basis of
(NCD-4) best available information);
and rating reaffirmed
Non-Convertible 50.00 CARE D Removal of Issuer not
Debenture issue Cooperating (on the basis of
(NCD-5) best available information);
and rating reaffirmed
Detailed Rationale & Key Rating Drivers
The ratings assigned to the Bank facilities/Instruments of RBNL
have been reaffirmed on account of ongoing delays in debt servicing
since September 2019. The ratings also takes into accounts the weak
financial performance albeit reduction of debt during FY2020. The
rating further takes into accounts the pending approval from
Ministry of Information and Broadcast for the acquisition of RBNL
by Music Broadcast Limited (MBL; owned by Jagran Prakashan
Limited). Further, the ratings also takes into accounts the
slowdown in advertisement spends on private radio broadcasting
during FY20, and further expected reduction in such spends during
FY2021 due to economic slowdown from Covid-19.
Detailed Rationale & Key Rating Drivers
Key Rating Weaknesses:
* Ongoing delays/default in debt servicing: There has been an
ongoing delay in debt servicing since September, 2019. As a part of
CARE's due diligence process, CARE had obtained 'Default if any'
statement dated March 6, 2020, April 2, 2020, May 1, 2020 and June
1, 2020 from the company which mentioned delays/default in debt
servicing (both principal and interest) on the terms loans availed
by the company, as also delays of more than 30 days in servicing
interest on loans from banks/financial institutions, and a delay in
debt servicing of the unlisted debt obligations of the company.
* Weak financial position albeit reduced total debt in FY20: TOI
declined by around 5% to INR301crore in FY19 (vs INR318crore in
FY18) due to lower advertisement revenue from government and
private sectors. However, the loss reduced to INR109 crore in FY19
(vs INR132crore in FY18) as the company reducing its expenses on
advertisement by 57% on y-o-y basis, and employees by 9% on y-o-y
basis. The loss further reduced to INR90 crore in FY20 on TOI of
INR244crore, due to continued focus on reducing costs. Continuous
losses over the past few years have eroded the networth of the
company. Despite the equity infusion of circa Rs600 crore during
FY20, the networth stood at negative value of INR604crore as on
March 31, 2020 (as per provisional figures). Interest coverage
ratio has been less than unity since FY16 and stood at 0.46x as in
FY19. As per the provisional figures for FY20, total debt has
reduced to INR703.7 crore (Including principal and interest) (out
of which INR304 crore is loan of Reliance Group Companies) as on
March 31, 2020 from INR1,317 crore as on March 31, 2019 as equity
infusion was used to repay the loans.
* Update on Acquisition by Music Broadcast Limited: The approval
for the acquisition of RBNL by MBL is still pending with MIB. As
per the agreement dated June 11, 2019, MBL has agreed to buy 40
radio stations for INR1050crore, subject to fulfillment of certain
conditions. RBNL has 58 stations out which MBL cannot buy 18
stations because they operate cities, where MBL already maintain a
presence. On April 10, 2020, Telecom Regulatory Authority of India
(TRAI) removed the existing ceiling limit of 15% of total FM Radio
channels in the country permitted to single permission holder. With
this change in policy, the management expects the approval for the
acquisition deal to come during Q2FY21, and thus paving way for the
takeover of RBNL by MBL. The money received from the MBL will be
used to pay off the term loan and NCDs. Surplus if any, will then
be distributed to the equity shareholders.
* Slowdown in advertisement spends on private radio broadcasting
coupled with negative impact of COVID-19 on Private Radio
Broadcasting business: The radio industry is reeling under the
effects of the economic slowdown and consequent cut in ad spends by
advertisers including the Government. Most of the players are
expected to degrow by 20% in FY20. Coupled with the economy
slowdown, radio industry is now also facing the heat of covid-19
outbreak. With most of the companies cutting down their budget for
advertisements spend, the advertisement revenue has taken a set
back from both private sector and government spending through this
medium. The Association of Radio Operations for India (AROI) has
written to the central government seeking a bailout package as
government ad spends have declined. The 3 bailout package include
defray cost, restoration of government advertising on radio and
clearing overdue outstanding payments. The bailout package will
bring relief to private radio broadcasters who are currently facing
the heat of the economic crunch. Further, in private sector
healthcare, pharma, online education, OTT, FMCG products like
sanitizers etc. are some of the categories who are willing to spend
on advertisement through this medium. According to industry
estimates, radio ad spend was likely be a little less than
Rs3,000crore in 2020, which is now likely to be revised downwards.
Liquidity analysis: Weak
Liquidity position remains weak due to continued loss making
operations, and also lack of timely support from the promoter group
companies, which face severe liquidity issues themselves. The
company does not have the access to liquidity from FIs due to
ongoing defaults. It depends on the PBILDT level profits to meet
the operational expenses, and by delaying the debt servicing
obligations.
RBNL, incorporated on December 27, 2005, is a part of the Anil
Ambani-led Reliance Group. The company is in the business of radio
broadcasting (BIG FM). On May 29, 2019 the RCL and Reliance Land
Private Limited. (RLPL) announced divestment their entire equity
stake in RBNL to MBL, which is owned by Jagran Prakashan Limited,
for a total consideration of INR1050crore. As per RBNL's
management, the entire transaction is expected to close in Q2FY21.
SAHA INFRATECH: CARE Keeps D INR160cr NCD in Not Cooperating
------------------------------------------------------------
CARE Ratings said the rating for the bank facilities of Saha
Infratech Private Limited (SIPL) continues to remain in the 'Issuer
Not Cooperating' category.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Non-Convertible
Debenture issue 160.00 CARE D; Issuer not cooperating;
Based on best available
Information
Detailed Rationale & Key Rating Drivers
CARE had, vide its press release dated March 29, 2019; placed the
rating(s) of SIPL under the 'issuer non-cooperating' category as
SIPL had failed to provide information for monitoring of the
rating. SIPL continues to be non-cooperative despite repeated
requests for submission of information through e-mails dated May
28, 2020; June 2, 2020 and June 8, 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
At the time of last rating on March 29, 2019 the following were the
rating strengths and weaknesses:
* Ongoing Delays in Debt Servicing: The company has defaulted in
debt servicing of the interest payments due on December 30, 2018
due to tight liquidity position.
* Subdued industry scenario: The real estate sector has been
grappling with issues such as unsold inventory, delayed delivery
and financial stress on the developers for quite some years now and
post demonetization; due to higher liquidity the buyers have
deferred their purchases as they are expecting the borrowing rates
to come down. However, with the introduction of Real Estate
(regulation and Development) Act (RERA) and GST (Goods and Services
Tax), the residential real estate sector is on the path of
transformation with modified rules and mandatory approvals which
will enhance the transparency and customers' trust in the sector
but also add additional burden on the developers which might hamper
the sentiments of the market.
Saha Infratech Private Limited (SIPL) was incorporated in 2011 and
is promoted by Mr. Anil Kumar Saha (Chairman & Managing Director)
who is a professional architect and holds a degree of Master of
Architecture. He has over 25 years of experience in real estate
development. Mr. Ashok Kumar Sirohi (Joint Managing Director) has
experience of over a decade in real estate sector and is
responsible for making strategic decisions for the company. SIPL is
engaged in real estate development and construction of residential
group housing projects and is currently working to deliver its two
maiden real estate projects; both of them are located in Noida
(Uttar-Pradesh).
SHRIPAL GOEL: CARE Lowers Rating on INR6.50cr LT Loan to B
----------------------------------------------------------
CARE Ratings revised the ratings on certain bank facilities of
Shripal Goel Educational Society (SPES), as:
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long-term Bank 6.50 CARE B; Issuer not cooperating;
Facilities Revised from CARE BB-; Issuer
not cooperating; Based on best
available information
Detailed Rationale & Key Rating Drivers
CARE had, vide its press release dated April 23, 2019 placed the
rating(s) of SPES under the 'issuer non cooperating' category as
Shripal Goel Educational Society had failed to provide information
for monitoring of the rating. Shripal Goel Educational Society
continues to be non-cooperative despite repeated requests for
submission of information through e-mails, phone calls and a letter
dated June 9, 2020 and June 11, 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 rating has been revised by taking into account non-availability
of requisite information and no due-diligence conducted due to
non-cooperation by Shripal Goel Educational Society 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 April 23, 2019, the following were
the rating strengths and weaknesses:
Key Rating Weaknesses
* Small scale of operations: The scale of operations has remained
small which inherently limits the firm's financial flexibility in
times of stress and deprives it from scale benefits.
* Leveraged capital structure and high collection period: The
capital structure stood leveraged mainly due to debt funded capex
undertaken by the society to set the colleges. SPES receives part
of its fee from Samaj Kalyan Vibhag which is a UP government body
and funds the education of students belonging to weaker sections of
the society. There have been procedural delays in realizing of
payments from the Samaj Kalyan Vibhag, the average collection
period of the society is thus elongated.
* Operations concentrated to a single geographical area with
increasing competition from established and upcoming educational
institutes: SPES has its institute within a single campus located
in Saharanpur, Uttar Pradesh which limits the reach penetration
level for the trust to tap opportunities. Further, due to
increasing focus on technical education in India, a number of
colleges have been opened up in close proximity. This exposes the
revenue of SPES to competition from other colleges. However,
despite the high competition, SPES has been able to maintain
moderate enrollment ratio for most of its courses.
* Highly regulated educational sector in India: In addition to
AICTE, the educational institutes are regulated by respective State
Governments with respect to the number of management seats, amount
of the tuition fees charged for the Government quota and management
quota. These factors have a significant impact on the revenue and
profitability of the institutions. The education sector remains
highly regulated industry with constant intervention from the
central state government and other regulatory bodies.
Key Rating Strengths
* Experienced members of the trust with established track record in
education sector: Dr. Subhash Chandra Kulshreshtha, chairman of
SPES, has about four decades of experience in the education arena
and was instrumental in setting up the society in 2008. He is also
the chairman of Shri Ram Charitable Trust and Chaudhary Harchand
Singh group of Colleges, which are running successfully for the
past a decade. He is supported by his son Shri Sankalp Kulshreshta,
Secretary of the society, Shri Trilok Singh Rawat, Vice President
of the society and Shri Davendra Kumar, Treasurer of the society,
all having decade experience in education sector.
* Healthy profitability margins and moderate coverage indicators:
The profitability margins of SPES stood moderate owing to better
absorption of fixed cost. Further the debt coverage indicators
stood moderate owing to moderate profitability margins.
SPES was established in September 2008 by Mr Subhash Chandra
Kulshreshtha and is registered under section 12A of the Income Tax
Act, as a Charitable Society, to establish educational institutes
imparting education in various professional disciplines in
Saharanpur, Uttar Pradesh. The society started an engineering
college in 2010-2011 under the name of Indraprastha Institute of
Management & Technology (IIMT). In the academic year 2015-2016,
student intake capacity has increased to 2,280 seats. The institute
is approved by All India Council for Technical Education (AICTE)
and affiliated to "U.P. Board of Technical Education (UPBTE),
Lucknow." The various courses offered by IIMT are engineering
courses (Civil Engineering, Computer Science Eng., Electrical
Engineering, Electronics & Comm. Engineering, Mechanical
Engineering and Infrastructure Technology) and polytechnic courses
(Civil Engineering, Production Mechanical Engineering and
Electrical Engineering). The society has an associate concern Shri
Ram Charitable Trust engaged in education services (established in
2003). The trust has six institutes offering graduation and
post-graduation courses in various disciplines like engineering,
management, law, polytechnic, architecture, journalism & mass
communication, etc, under the brand name 'Shri Ram Group of
College'.
SINHGAD TECHNICAL: CARE Keeps D Debt Ratings in Not Cooperating
---------------------------------------------------------------
CARE Ratings said the rating for the bank facilities of Sinhgad
Technical Education Society (STES) continues to remain in the
'Issuer Not Cooperating' category.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long term Bank 426.24 CARE D; Issuer not cooperating;
Facilities Based on best available
information
Short term Bank 16.45 CARE D; Issuer not cooperating;
Facilities Based on best available
information
Detailed Rationale & Key Rating Drivers
CARE had, vide its press release dated March 13, 2018, placed the
rating(s) of STES under the 'issuer non-cooperating' category as
STES had failed to provide information for monitoring of the rating
as agreed to in its Rating Agreement. STES continues to be
non-cooperative despite repeated requests for submission of
information through e-mails, phone calls and a letter/email dated
June 3, 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
At the time of last rating on May 23, 2019 the following were the
rating weaknesses.
Key Rating Weaknesses
The ratings assigned to the bank facilities of Sinhgad Technical
Education Society (STES), continue to factor in the ongoing delays
in debt servicing by STES due to its stressed liquidity position.
Sinhgad Technical Education Society (STES) was registered under the
Societies Registration Act, 1860 in August 1993. It is also
registered under the Bombay Public Trust Act, 1950. STES manages
higher education colleges and pre-primary, primary and secondary
schools. These schools and colleges provide full time courses in
the fields of Engineering, Management, Pharmacy,
Architecture, Gemology and Jewelry Designing, etc.
SURGICOIN MEDEQUIP: CARE Keeps D Debt Ratings in Not Cooperating
----------------------------------------------------------------
CARE Ratings said the rating for the bank facilities of Surgicoin
Medequip Private Limited (SMPL) continues to remain in the 'Issuer
Not Cooperating' category.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long term Bank 5.00 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 April 23, 2019 placed the
ratings of SMPL under the 'issuer non-cooperating' category as
Surgicoin Medequip Private Limited had failed to provide
information for monitoring of the rating. Surgicoin Medequip
Private Limited continues to be non-cooperative despite repeated
requests for submission of information through e-mails, phone calls
and a letter/email dated June 2, 2020, June 9, 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 have been reaffirmed by taking into account
non-availability of requisite information and no due-diligence
conducted due to non-cooperation by Surgicoin Medequip 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 April 23, 2019 the following were the
rating weakness:
The ratings take into account the ongoing delays in debt servicing
obligations due to stressed liquidity position.
Sonipat-based (Haryana) Surgicoin Medequip Private Limited (SMPL)
was incorporated January 27, 1986 under the name of Super Cardiac
Breaths Private Limited by Mr Naresh Grover. Later on February 02
2006, the name of the entity was changed to Surgicoin Medequip
Private Limited. The company is currently managed by Mr Naresh
Grover. The firm is engaged in manufacturing and trading of medical
equipment like operation Theatre Equipment, Respiratory Apparatus,
Electro Medical Equipment, Patients ward Equipment and other
medical products. The company has its manufacturing
facility located at Rai, Sonipat.
===============
M A L A Y S I A
===============
MAGNA PRIMA: Defaults on MYR37.79MM Term Loan
---------------------------------------------
The Sun Daily reports that Magna Prima Bhd has defaulted on a term
loan principal and accruing interest totalling MYR37.79 million as
at June 17, due to Alliance Bank.
In its Bursa filing, the group said the default arose after it
failed to pay installments on the principal and interest due since
March 2020, Sun Daily relates.
"This is largely due to a delay in project implementation for the
parcel of land, located at Seksyen 15, Shah Alam, and will be
spreaded over approximately 20 acres, which is held by Magna
Ecocity Sdn Bhd (MESB), a subsidiary of Magna Prima.
"As such, the subsidiary was badly affected with disruption in cash
flow which caused financial constraint to meet the bank obligations
then," it said.
According to Sun Daily, the market value of the land stood at
MYR200 million, per the valuation carried out in 2019, and as such
the and market value is secured against the bank facilities with
Alliance Bank, Magna Prima and MESB in the positive position.
Sun Daily relates that the group said it is engaging with
consultant to discuss with Alliance Bank on the terms of repayment
and possibly rescheduling the facility.
"In the opinion of the company, Alliance Bank should not have
proceeded with the legal proceedings. The company is actively
scheduling for meetings and will submit a comprehensive proposal to
reschedule the loan facilities in due course," it said, adding
there will not be any significant impact of the default in payment
on the business, financials and operation of the remaining business
of the group.
Magna Prima Berhad, through its subsidiaries, provides services in
civil engineering, infrastructures, building works, rock crushing,
earthworks, and drainage works. The Company subcontracts quarrying
operations and renders professional turnkey services. Magna Prima
also operates in property development and building construction.
MAGNA PRIMA: Net Loss Widens to MYR7MM in Q1 Ended March 31
-----------------------------------------------------------
The Sun Daily reports that Magna Prima announced that it saw a
wider net loss of MYR7 million for the first quarter ended March
31, from a net loss of MYR3.18 million a year before, mainly due to
the group only selling shop offices in its Kepong project during
the quarter.
Revenue also dropped to MYR1.99 million, from MYR10.09 million
previously, Sun Daily discloses.
"The board expects the current financial year to be challenging due
to the current sentiment of the property market. Cash flow will
remain tight. The board will continue to seek way to improve the
company performance and cash flow for the current financial year,"
Magna Prima said.
Magna Prima Berhad, through its subsidiaries, provides services in
civil engineering, infrastructures, building works, rock crushing,
earthworks, and drainage works. The Company subcontracts quarrying
operations and renders professional turnkey services. Magna Prima
also operates in property development and building construction.
=====================
N E W Z E A L A N D
=====================
KIKKI K: Closes New Zealand Shops but Stays Open in Australia
-------------------------------------------------------------
Stuff.co.nz reports that troubled stationery retailer Kikki K has
closed its seven shops in New Zealand.
The Australian global chain was put into receivership in March
after weak sales in December and January.
Stuff relates that Australian receiver Barry Wight, from Cor
Cordis, said at the time that the shops would remain open while the
company's financial position was assessed. But a month later the
Kikki K was put into liquidation.
According to Stuff, a spokesman for BDO, Kikki K's receivers in New
Zealand, confirmed that the company had closed its stores in New
Zealand and that all staff positions had been terminated.
"We understand a sale process is currently under way by the
receivers of the Australian operations," the report quotes the
spokesman as saying. "We also understand that the prospective
purchaser has expressed an interest in the New Zealand market and
we have provided contact details for all New Zealand landlords,
however we have not been provided with any further information
regarding their intentions."
Mr. Wight said in March that Kikki K had joined a "long list of
financially distressed retailers" to have fallen victim to
"softening consumer spending, high leasing costs, compounded by a
disappointing December and January trading period".
However, Australia-based Kikki K had a strong brand and a global
following with sales of nearly AUD70 million (NZD72 million) a
year, he said, Stuff relays.
Kikki K has 64 shops in Australia, the United Kingdom and
Singapore, according to its website.
When the receivership was announced, chief executive Paul Lacy said
an "unprecedented line-up of external factors" such as the
coronavirus, had contributed to the business's collapse.
"We've had the triple-whammy of soft consumer demand, the business
impact of bush fires and more recently the unprecedented and
profound impact of coronavirus which is hitting so many businesses
and countries so hard," the report quoted Mr. Lacy as saying.
Kikki K executives had been close to a rescue deal with a large
global investor prior to the collapse, but "ran out of time", a
spokesman said in March, recalls Stuff.
New Zealand customers could still buy Kikki K products online from
its local website, the report notes.
Kikki K was founded by Australian-based Swedish entrepreneur
Kristina Karlsson in 2001.
=================
S I N G A P O R E
=================
HIN LEONG: HSBC Among Banks with Grim Chances to Recoup Loss
------------------------------------------------------------
Bloomberg News reports that the prospects for HSBC Holdings Plc and
other banks to recover losses from a failed Singapore oil trader
are dimmer than originally thought after an accounting review found
the energy firm overstated assets by $3 billion and fabricated
documents on a "massive scale."
Hin Leong Trading (Pte) Ltd. has assets of about $257 million, or
7% of its estimated $3.5 billion in liabilities, the company's
interim managers said in a report to Singapore's High Court on June
23, Bloomberg relays. That's less than half the assets estimated by
founder Lim Oon Kuin and his son Evan Lim, according to earlier
affidavits to the court.
According to Bloomberg, HSBC is among 23 banks owed almost $4
billion by Hin Leong, one of the largest traders in Singapore
before its collapse in April following a plunge in oil prices that
exposed what the report found were "manipulated" accounts and
frequent double counting of cargo to keep credit lines flowing.
"The scale and regularity of the fabrication suggests that the
practice was routine and pervasive," the report, as cited by
Bloomberg, found. "These forged documents enabled the company to
mislead banks in extending financing to the company and also acted
as supporting documentation for the fictitious gains and profits."
The court filing was earlier reported by Reuters and Singapore's
Straits Times, Bloomberg notes.
Hin Leong "systematically manipulated its accounts to inflate the
value of its accounts receivables" to present an exaggerated
picture of its financial health, according to the report by
PricewaterhouseCoopers LLC's Chan Kheng Tek and Goh Thien Phong,
Bloomberg relays. Chan and Goh, who were appointed in April as
interim judicial managers to oversee the company, added that Hin
Leong has "no reasonable prospect" of rehabilitation as a
standalone entity, adds Bloomberg.
About Hin Leong
Hin Leong Trading (Pte.) Ltd. provides petroleum products and
transportation services. The Company offers oil, lubricants,
grease, and diesel products, as well grants storage, terminalling,
trucking, and marine logistics services. Hin Leong Trading serves
customers globally.
Hin Leong Trading and shipping unit Ocean Tankers (Pte.) Ltd. filed
for court protection from creditors on April 17, 2020, as the
former struggles to repay debts of almost US$4 billion.
Hin Leong posted a positive equity of US$4.56 billion and net
profit of US$78 million in the period ended October 31, according
to the people, who asked not to be identified as the matter is
sensitive, according to Bloomberg News.
But Hin Leong told its creditors this month that total liabilities
reached US$4.05 billion as of early April, while assets were just
US$714 million, leaving a hole of at least US$3.34 billion,
according to screenshots of the presentation to a group of bankers
seen by Bloomberg News.
The balance sheet of the company showed no equity at all as of
April 9, 2020, and warned that "figures obtained from the company
are subject to verification," Bloomberg News added.
On April 27, the Company was granted interim judicial management by
the the Singapore High Court. Goh Thien Phong and Chan Kheng Tek
of PricewaterhouseCoopers Advisory Services (PwC) have been
appointed as interim judicial managers.
*********
S U B S C R I P T I O N I N F O R M A T I O N
Troubled Company Reporter-Asia Pacific is a daily newsletter co-
published by Bankruptcy Creditors' Service, Inc., Fairless Hills,
Pennsylvania, USA, and Beard Group, Inc., Washington, D.C., USA.
Marites O. Claro, Joy A. Agravante, Rousel Elaine T. Fernandez,
Julie Anne L. Toledo, Ivy B. Magdadaro and Peter A. Chapman,
Editors.
Copyright 2020. All rights reserved. ISSN: 1520-9482.
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