/raid1/www/Hosts/bankrupt/TCRAP_Public/201209.mbx
T R O U B L E D C O M P A N Y R E P O R T E R
A S I A P A C I F I C
Wednesday, December 9, 2020, Vol. 23, No. 246
Headlines
A U S T R A L I A
ALITA RESOURCES: US Buyer Emerges for Bald Hill Mine
EDUCATIONAL WORLD: In Liquidation; Students AUD2.3MM Out of Pocket
PWUO TRADING: Second Creditors' Meeting Set for Dec. 17
C H I N A
DANKE APARTMENT: Staff Plan Court Action Over Unpaid Wages
SEAZEN HOLDINGS: S&P Rates Guaranteed Senior Unsecured Notes 'BB'
H O N G K O N G
BRIGHTOIL PETROLEUM: In Talks for Share Capital Disposal in Unit
I N D I A
AISSHPRA LIFESPACES: ICRA Withdraws B+ Rating on INR30cr Loan
APEX STEEL: Ind-Ra Keeps 'BB-' LT Issuer Rating in Non-Cooperating
BANSAL RICE: CARE Keeps D Debt Rating in Not Cooperating
CHEMSOL LABS: CARE Keeps C Debt Rating in Not Cooperating
CMI LIMITED: CARE Reaffirms D Rating on INR235cr Loan
DEWAN HOUSING: ICRA Reaffirms D(SO) Rating on INR8.73cr Bank Debt
FORTIS HEALTHCARE: ICRA Keeps D Debt Ratings in Not Cooperating
GMW ENGINEERS: Ind-Ra Cuts LT Issuer Rating to BB, Outlook Stable
GOPAL OIL: ICRA Lowers Rating on INR9.90cr Cash Loan to D
INDO NABIN: CARE Reaffirms D Rating on INR9.50cr LT Loan
JET AIRWAYS: Plans to Resume Services by Summer 2021
JINDAL GREEN: CARE Lowers Rating on INR12cr LT Loan to C
JYOTI VINCOM: ICRA Keeps B- Debt Ratings in Not Cooperating
KARNIMATA COLD: ICRA Keeps B Debt Ratings in Not Cooperating
KOMARLA HATCHERIES: Ind-Ra Cuts LongTerm Issuer Rating to 'BB-'
KOVAI KALAIMAGAL: CARE Keeps D Debt Ratings in Not Cooperating
KRISHNASHRAY (INDIA): CARE Keeps C Debt Rating in Not Cooperating
LAXMINARAYAN SHIVHARE: CARE Keeps D Ratings in Not Cooperating
LONDON STAR: CARE Keeps D Debt Ratings in Not Cooperating
MAA KALI ALLOYS: ICRA Keeps B+ Debt Ratings in Not Cooperating
MJM INDUSTRIES: Ind-Ra Keeps 'B' Issuer Rating in Non-Cooperating
PATWARI STEELS: ICRA Keeps D on INR13.7cr Loans in Not Cooperating
PAWAN AUTOWHEELS: CARE Lowers Rating on INR11.15cr LT Loan to B-
POLIXEL SECURITY: Ind-Ra Affirms 'BB' LongTerm Issuer Rating
RELIANCE INFRASTRUCTURE: Ind-Ra Affirms 'D' LongTerm Issuer Rating
SOUTHERN AGENCIES: ICRA Reaffirms B Rating on INR10cr LT Loan
SREEREDDY PROPERTIES: CARE Lowers Rating on INR5.34cr Loan to C
SWATHI SUNSOURCE: CARE Lowers Rating on INR14cr Loan to C
SWAYAMPRABHA UDAYAM: ICRA Reaffirms B+ Rating on INR4.25cr Loan
SYNCO INDUSTRIES: ICRA Keeps C+ Rating in Not Cooperating
TELUGU CINE: Ind-Ra Keeps 'D' Bank Loan Rating in Non-Cooperating
V.A. PRODUCTS: CARE Lowers Rating on INR1.50cr LT Loan to C
VAMSI CHEMICALS: Ind-Ra Affirms 'B+' LongTerm Issuer Rating
VELANI OILS: CARE Keeps D on INR9cr Loans in Not Cooperating
VISHAL CONDUIT: CARE Lowers Ratings on INR5cr Loan to 'C/A4'
J A P A N
DENTSU GROUP: To Slash 6,000 Jobs From Overseas Operations
P H I L I P P I N E S
PHILIPPINE AIRLINES: Woes Peril Tan's Sangley Airport Bid
S I N G A P O R E
SEA NAVIGATION: Placed in Voluntary Liquidation
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A U S T R A L I A
=================
ALITA RESOURCES: US Buyer Emerges for Bald Hill Mine
----------------------------------------------------
miningweekly.com reports that US-based lithium products group
Austroid Corporation is hoping to acquire the mothballed Bald Hill
lithium mine, in Western Australia, from Alita Resources, which was
previously known as Alliance Mineral Assets.
Alita went into administration in 2019, and Bald Hill was placed on
care and maintenance.
According to the report, Austroid said that subject to regulatory
approvals, the company was ready to invest $60-million in new
equipment, processing and construction at Bald Hill to enable the
resumption of lithium concentrate production.
It is estimated that restarting Bald Hill would create at least 150
jobs in regional Western Australia, across Bald Hill and at the
Port of Esperance, the report says.
As part of the arrangement to secure ownership of Bald Hill,
Austroid has agreed to purchase a $70-million loan facility
agreement between Alita and China Hydrogen Energy Limited (CHEL),
according to miningweekly.com. CHEL had lent Alita the money in
2019 as part of a deed of company arrangement (DoCA) to restructure
Alita's affairs.
miningweekly.com relates that Austroid director Mike Que said
Austroid's decision to secure ownership of Bald Hill was driven by
a desire to become a reliable and secure supplier of lithium
concentrate into the North American market.
"Bald Hill is a quality asset that fits Austroid's integrated
lithium supply strategy to supply our own proposed lithium refinery
in Nevada as well as third-party customers in the US,"
miningweekly.com quotes Mr. Que as saying.
"Importantly, Bald Hill's location in a global tier 1 mining
jurisdiction, with ready access to a highly skilled local workforce
and suppliers, gives us the comfort to invest significant sums into
resuming mining operations.
"The feedback from Bald Hill's stakeholders and the broader
communities in the Goldfields and Esperance regions on Austroid's
investment proposal has been overwhelmingly positive because they
recognise the regional benefits and job opportunities, particularly
as part of the post-pandemic economic recovery process," said Que.
"We look forward to completing the approvals process, including
sign-off from the West Australian and Federal Governments, before
we set about resuming operations at Bald Hill as early as the first
half of 2021."
Austroid has proposed a DoCA to restructure Alita, which it hopes
will win support of Alita's administrators from McGrathNicol, the
report notes.
Austroid is also in the process of applying to the Foreign
Investment Review Board for approval as part of the regulatory
process, miningweekly.com adds.
Alita Resources Limited (ASX:A40) operates as a mineral exploration
and excavation company. The Company explores and produces lithium
and tantalum concentrates. Alita Resources offers its services in
Australia.
Robert Michael Kirman and Robert Conry Brauer of McGrathNicol were
appointed as administrators of Alita Resources Limited, Lithco NO.2
Pty Ltd, and Tawana Resources Pty Ltd on Dec. 4, 2020.
EDUCATIONAL WORLD: In Liquidation; Students AUD2.3MM Out of Pocket
------------------------------------------------------------------
ABC News reports that hundreds of Australian students were facing
the collective loss of more than AUD2 million they paid in advance
for overseas school trips after a travel company went into
liquidation.
A firm has been appointed liquidator for Educational World Travel
(EWT), being used to organise end-of-year student tours to the
United States for 2021.
According to ABC, liquidator David Coyne, of BRI Ferrier, said more
than 800 students and their families were owed a total of AUD2.3
million by EWT.
The company's collapse affected students from New South Wales,
Queensland and Victoria, the report says.
ABC relates that Terry Steele, from Bathurst in central-western New
South Wales, said his family had already paid AUD2,000 to the
company for his daughter's trip, which had a total cost of about
AUD6,000.
Mr. Steele said his daughter, Charlotte, had contributed to the
deposit by working at a butcher's shop each week to help pay for
the trip.
EWT went into voluntary administration on November 30, ABC
discloses.
"This action is a direct result of the devastating effect of
COVID-19 on the travel industry, particularly international
travel," an email statement from EWT said.
Attempts by the ABC to contact a spokesperson for EWT were
unsuccessful.
Mr. Steele said he believed the company had handled the situation
"poorly".
"They've had no communication at all in regards to any issues," the
report quotes Mr. Steel as saying.
While students and their families were made aware of the trips
through their schools, it is unclear what role the schools had in
the organisation process, the report notes.
The ABC has contacted the New South Wales Department of Education
for comment.
According to ABC, the liquidator's creditors' report stated it
understands EWT has AUD113,000 in its bank account but it is still
waiting for a response from banks.
It said students were considered to be unsecured creditors of the
company.
Liquidator David Coyne told the ABC he expected to be able to
provide an update in February.
PWUO TRADING: Second Creditors' Meeting Set for Dec. 17
-------------------------------------------------------
A second meeting of creditors in the proceedings of PWUO Trading
Pty Ltd, trading as ATF PWUO Trading Unit Trust Trading As Paul's
Warehouse USA Outlet, has been set for Dec. 17, 2020, at
11:00 a.m. via BPS Teleconference Facility.
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 Dec. 16, 2020, at 4:00 p.m.
David Anthony Hurst and David Henry Sampson of BPS Recovery were
appointed as administrators of PWUO Trading on Nov. 12, 2020.
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C H I N A
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DANKE APARTMENT: Staff Plan Court Action Over Unpaid Wages
----------------------------------------------------------
Niu Mujiangqu and Anniek Bao at Caixin Global report that besieged
online rental giant Danke Apartment could be facing a new source of
pain, with employees telling Caixin they plan to take the company
to court over unpaid wages.
With a business model based on rental arbitrage that has been
compared to WeWork, the money-losing firm is accused of failing to
make monthly and quarterly payments to the landlords from whom it
rents properties, even after it encouraged tenants to pay rent up
front using long-term loans from a partner bank, and invested the
difference, Caixin relates.
Caixin relates that the upshot, according to security staff at
Danke's Beijing headquarters, is that some 300 disgruntled
landlords and tenants have been showing up each day demanding
overdue rent, refunds and compensation.
As reported in the Troubled Company Reporter-Asia Pacific on Nov.
19, 2020, Danke Apartment, one of China's largest rental
specialists, has not been paying rent to property owners, the
service's tenants said, causing an uproar that could leave some of
its users out on the street. Danke, which is run by New York-listed
Phoenix Tree Holdings Ltd., is one of the latest rental agents
whose financial troubles have worsened in the wake of China's
coronavirus epidemic, raising questions about a business model that
requires immense sums of cash up front to fund a rapid expansion,
according to Caixin.
SEAZEN HOLDINGS: S&P Rates Guaranteed Senior Unsecured Notes 'BB'
-----------------------------------------------------------------
S&P Global Ratings assigned its 'BB' long-term issue rating to a
proposed issuance of U.S.-dollar-denominated senior unsecured notes
by New Metro Global Ltd., a subsidiary of Seazen Holdings Co. Ltd.
(BB/Positive/--). Seazen will unconditionally and irrevocably
guarantee the notes. The issue rating is subject to its review of
the final issuance documentation.
The China-based property developer has also announced a tender
offer at about 101% of the principal amount for its two outstanding
U.S.-dollar bonds due in April and in May 2021. S&P believes that
the tender offer is Seazen's proactive management of its maturity
profile, and is opportunistic in nature, considering the company's
steadily improving credit profile from stable cash flow and ample
liquidity.
S&P said, "We equalize the issue rating with our issuer credit
rating on Seazen because the proposed notes are not significantly
subordinated to other debt in the company's capital structure. As
of June 30, 2020, Seazen's capital structure consisted of about
Chinese renminbi (RMB) 49.4 billion in secured debt and RMB1.3
billion in unsecured debt at its subsidiaries, which we consider as
priority debt. It also had unsecured debt of RMB37.1 billion in the
form of domestic and U.S.-dollar debt securities, as well as RMB18
billion of joint-venture guarantees given out at the holding
company level, all of which we consider to be nonpriority debt. As
such, its priority debt ratio is at about 47.9%, lower than our
notching-down threshold of 50%, and we expect it to remain
relatively stable.
"We expect the proposed issuance to mildly affect Seazen's
leverage, given that the proceeds would be mainly used for
refinancing purposes. The positive outlook reflects our view that
the company will continue with the solid execution and expansion of
its rental portfolio while maintaining stable debt leverage and
extending its debt maturity profile."
=================
H O N G K O N G
=================
BRIGHTOIL PETROLEUM: In Talks for Share Capital Disposal in Unit
----------------------------------------------------------------
Manifold Times reports that Brightoil Petroleum (Holdings) Limited
on November 30 published a notice regarding the intended disposal
of its interest in its subsidiary Brightoil Petroleum (S'pore) Pte
Ltd (BOPS) via a sale in order to enhance its asset structure.
Manifold Times relates that Brightoil said it is engaging in
preliminary commercial negotiations with a potential investor
Landoil (S'pore) Pte Ltd (Landoil), in turn a wholly owned
subsidiary of Shenzhen Brightoil Group Co., Ltd. (SZBO), for the
intended sale of the entire interest and business structure in BOPS
and has on November 19, 2020 entered into a non-binding Memorandum
of Understanding (MOU) with Landoil.
According to Manifold Times, Brightoil noted BOPS is currently
under moratorium protection under the inherent jurisdiction of the
Singapore Court, and has initiated a process to restructure its
liabilities involving possibly a scheme of arrangement to be
sanctioned by the Singapore Court.
Despite having recorded positive net asset, BOPS does not have the
necessary resources to revive its business nor to actively or
effectively recover its account receivables, it added, Manifold
Times relays.
In addition, the group is restricted by the Zhoushan disposal to
continue to engage in the trading and marine bunkering businesses
originally carried out by BOPS which will be regarded as
competitive business by the purchaser of the Zhoushan Project, the
report notes.
On the other hand, Landoil, together with its holding company SZBO,
having all the necessary licenses in the PRC to carry out the
relevant business, is keen on developing the inherent business of
BOPS and is positive that once the business is revived, the account
receivables or a substantial part of which could be recovered by
BOPS, according to Manifold Times.
Manifold Times adds that Landoil intends to fully utilise BOPS's
existing business relationships and all the relevant licenses
including bunker license (the existing licenses in Singapore market
to be renewed) for the development of the trading and marine
bunkering business.
Brightoil Petroleum (Holdings) Limited is a Hong Kong-based
investment holding company principally engaged in the provision of
petroleum products and marine bunkering services. The Company
operates through five segments. International Trading and Bunkering
Operation segment is engaged in the international supply of
petroleum.
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I N D I A
=========
AISSHPRA LIFESPACES: ICRA Withdraws B+ Rating on INR30cr Loan
-------------------------------------------------------------
ICRA has withdrawn the ratings on certain bank facilities of
Aisshpra Lifespaces (ALS), as:
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long Term– 30.00 [ICRA]B+ (Stable); ISSUER NOT
Fund Based– COOPERATING; Withdrawn
Term Loan
Rationale
The ratings assigned to the bank facilities of ALS have been
withdrawn in accordance with ICRA's policy on withdrawal and
suspension at the request of the company, basis the no-objection
certificates provided by its bankers. ICRA does not have adequate
information to suggest that the credit risk has changed since the
time the rating was last reviewed.
Key rating drivers and their description
Key rating drivers have not been captured as the rated
instrument(s) are being withdrawn.
Liquidity position
Not captured as the rating is being withdrawn.
Rating sensitivities
Not captured as the rating is being withdrawn.
Incorporated in December 2013, Aisshpra Lifespaces (ALS) is a
partnership firm. It is working on its first real estate project,
Paalm Paradise. Itis headed by Mr. Atul Saraf, Mr. Anoop Saraf and
Mr. Vikas Kejriwal. Paalm Paradise is located in Taramandal,
Gorakhpur. The project is in the vicinity of the railway station,
airport, bus station, and national highway. The project is to be
executed in phases. Currently the first phase is ongoing and is
scheduled for completion in December 2019.
APEX STEEL: Ind-Ra Keeps 'BB-' LT Issuer Rating in Non-Cooperating
------------------------------------------------------------------
India Ratings and Research (Ind-Ra) has maintained Apex Steel &
Alloys' Long-Term Issuer Rating in the non-cooperating category.
The issuer did not participate in the rating exercise despite
continuous requests and follow-ups by the agency. Therefore,
investors and other users are advised to take appropriate caution
while using these ratings. The rating will continue to 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 maintained in the
non-cooperating category with IND BB- (ISSUER NOT
COOPERATING)/IND A4+ (ISSUER NOT COOPERATING) rating; and
-- INR100 mil. Proposed fund-based working capital limits
withdrawn (the company did not proceed with the instrument as
envisaged).
Note: ISSUER NOT COOPERATING: The ratings were last reviewed on
November 7, 2017. Ind-Ra is unable to provide an update, as the
agency does not have adequate information to review the ratings.
COMPANY PROFILE
Incorporated in January 2012, Apex Steel & Alloys is a partnership
firm engaged in the trading of stainless-steel plates, which are
imported from the US and South Africa.
BANSAL RICE: CARE Keeps D Debt Rating in Not Cooperating
--------------------------------------------------------
CARE Ratings said the rating for the bank facilities of Bansal Rice
Mill (BRM) continues to remain in the 'Issuer Not Cooperating'
category.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long Term Bank 15.00 CARE D; ISSUER NOT COOPERATING
Facilities Rating continues to remain
under ISSUER NOT COOPERATING
category
Detailed Rationale & Key Rating Drivers
CARE had, vide its press release dated September 9, 2019, placed
the rating of BRM under the 'issuer noncooperating' category as BRM
had failed to provide information for monitoring of the ratings.
BRM continues to be noncooperative despite repeated requests for
submission of information through e-mails, phone calls and a
letter/email dated October 15, 2020, October 14, 2020, October 13,
2020, and October 12, 2020. In line with the extant SEBI
guidelines, CARE has reviewed the rating on the basis of the best
available information which however, in CARE's opinion is not
sufficient to arrive at a fair rating.
Users of this rating (including investors, lenders and the public
at large) are hence requested to exercise caution while using the
above ratings.
Detailed description of the key rating drivers
At the time of last rating on September 9, 2019, the following were
the rating weaknesses:
* Instances of delays in the servicing of debt obligation: There
have been instances of delays in the servicing of term debt
obligation.
Bansal Rice Mill (BRM) was established in April, 2007 as a
partnership firm and is currently being managed by Mr. Sandeep
Kumar, Mr. Amandeep Bansal, Mr. Badri Prasad, Mrs Rashmi Bansal and
Mrs Manisha Bansal as its partners sharing profit and loss equally.
The firm is engaged in processing of paddy and milling of rice
since FY15 (refers to the period April 01 to March 31) at its
manufacturing facility located at Sangrur (Punjab) having an
installed capacity of 12306 tonnes per annum as on March 31, 2016.
Prior to FY15, BRM was involved in cotton ginning and milling of
rice primarily for government. Presently, BRM procures paddy
directly from local grain markets located in Punjab and sells the
finished products to various wholesalers located in Delhi and
Haryana.
CHEMSOL LABS: CARE Keeps C Debt Rating in Not Cooperating
---------------------------------------------------------
CARE Ratings said the rating for the bank facilities of Chemsol
Labs Private Limited (CLPL) continues to remain in the 'Issuer Not
Cooperating' category.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long Term Bank 3.00 CARE C; ISSUER NOT COOPERATING;
Facilities Rating continues to remain
under ISSUER NOT COOPERATING
category and Revised from
CARE B; Stable
Short Term Bank 4.18 CARE A4; ISSUER NOT
Facilities COOPERATING; Rating continues
to remain under ISSUER NOT
COOPERATING category
Detailed Rationale & Key Rating Drivers
CARE had, vide its press release dated August 28, 2019, placed the
rating(s) of CLPL under the 'issuer non-cooperating' category as
CLPL had failed to provide information for monitoring of the
rating. CLPL continues to be non-cooperative despite repeated
requests for submission of information through e-mails, phone calls
and email dated from January 2020 to November 6, 2020. In line with
the extant SEBI guidelines, CARE has reviewed the rating on the
basis of the best available information which however, in CARE's
opinion is not sufficient to arrive at a fair rating.
Users of this rating (including investors, lenders and the public
at large) are hence requested to exercise caution while using
the above rating.
The revision in the rating takes into account the non-availability
of requisite information due to non-cooperation by Chemsol Labs
Private Limited with CARE's efforts to undertake a review of the
outstanding ratings as CARE views information availability risk as
key factor in its assessment of credit risk profile
Detailed description of the key rating drivers
At the time of last rating on August 28, 2019, the following were
the rating strengths and weaknesses
Key Rating Weakness
* Small scale of operation with low margins owing to trading nature
of activity: The size and scale of company's operation remains
small with total operating income of INR25.20 crore for FY15
(refers to the period April 1 to March 31) and relatively low net
worth base of INR4.37 Crore as on March 31, 2015.. However, the
scale of operation has been gradually increasing over the last few
years as represented by the increase in total operating income from
INR22.40 crore in FY13 to INR25.20 crore in FY15 at a CAGR of
6.07%. The profitability margins are on lower side due to the
trading nature of business which contributed around 61.31% to
revenue in FY15.
* Working capital intensive nature of business: The nature of
business in which the company operates is working-capital
intensive. In view of the fact that collections of payments
from clients have a longer tenure as compared to payments to
vendors and suppliers, the company relies on working capital bank
borrowings to bridge the gap. Also the company is going for exports
the company needs working capital in the form of packing credit to
procure raw materials convert it into finished goods under contract
basis and dispatch it to respective clients. As a result, there is
dependence on working capital borrowings, with average working
capital utilisation standing at around 62% during the last 12
months ended April, 2015. Given the increase in the scale of
operations, the company is expected to continue its reliance on
working-capital bank borrowings and prudent working capital
management will be important from credit perspective.
Key Rating Strengths
* Considerable experience of its promoters: Chemsol is promoted by
Mr. Vamsi Krishna and his wife Mrs Swarna Kumari. Mr. Krishna has
around 25 years' of market experience. He started his career as a
marketing and sales associate with Chemplast Sanmar Limited (part
of Sanmar group). The business operations of Chemsol benefits from
his track record and the industry network developed over the years
in the Pharma industry. Mrs. Swarna Kumari, the Director-commercial
of Chemsol has experience of 10 years in the market. She has
brought in various innovative systems in place to maintain and
track the accounts more effectively and efficiently.
* Diverse product portfolio and recent commencement of export
sales: Chemsol is primarily engaged in trading of pharma products.
The company also undertakes manufacturing of formulations,
intermediates, celluloses and pharma pellets. The company's
products which find applications in various industries such as
textiles, food, paper, ceramics, cosmetics, adhesives, detergents
and oil drilling industries. Chemsol has around 70 products in its
portfolio, out of which the company engages in manufacturing of
around 20 branded products which includes 17 formulations
(trademarked and registered) and 3 conversion based intermediates.
The company does not have its own manufacturing facilities and
enters into conversion contract (job work) with various
manufacturing players like M/s Srivasta Life Sciences Private
Limited etc. under loan license.
The company's manufacturing/conversion products include Cis Bromo
Benzoit, which is an intermediate of Itracanjole for fungal
infections manufactured by Piramal Health Care-part of Piramal
group. Chemsol has wide customer base and income generated is not
concentrated with few customers. Total operating income of the
company for FY15 was INR25.20 crore which comprises of trading
activity (61.32%) and manufacturing activity (36.68%) and rest is
from exports (2%) to Australia, Europe and Germany. The company's
revenue generated from top 10 customers was INR14.28 crore (58.14%
of total revenue generated INR25.20 crore for FY15).The company has
recently commenced export sales to Bangladesh and Pakistan. Chemsol
exported products worth INR0.35 crore and INR0.49 crore in FY14 and
FY15 respectively and has current export order in hand of INR3
crore for FY16 constituting of 11.10% of projected income for FY16.
Revenue break up for FY15.
* Satisfactory capital structure and debt coverage indicators but
constrained by a low net worth: The capital structure of the
company is satisfactory, marked by overall gearing level of 0.85x
as on March 31, 2015. Gearing levels improved from 2.83x as on
March 31, 2013 to 2.42x as on March 31, 2014 and to current level
backed primarily by equity infusion of INR2 crore (including share
application money of INR0.25 crore) and repayment of loans. The
debt coverage indicators have been also satisfactory. The PBILDT
interest coverage stood at 1.55x in FY15.As on March 31, 2015, the
net worth of the company has increased to INR4.37 crore compared to
INR2.36 crore as on March 31, 2014, at the back of infusion of
equity of INR1.75 crore and accretion of profit to the net worth.
Debt as on March 31, 2015, comprises of unsecured loans from
related parties and working capital borrowings. It also has
negligible term loan which comprises of vehicle loans.
Incorporated in August, 2006 as "Chemsol Labs Private Limited"
(Chemsol), by Mr. Vamsi Krishna (Managing Director) and his wife
Mrs Swarna Kumari (Director), to carry on trading of
pharmaceuticals (Pharma) products. The company also undertakes
manufacturing of certain pharmaceutical products (APIs and
formulations) and chemicals which is in the nature of conversion
under loan licenses. The company does not have its own
manufacturing facilities and gets the manufacturing done by way of
job work. Chemsol deals with around 70 pharma products (trading and
manufacturing).
CMI LIMITED: CARE Reaffirms D Rating on INR235cr Loan
-----------------------------------------------------
CARE Ratings reaffirmed ratings on certain bank facilities of CMI
Limited (CMI), as:
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long term/
Short Term
Bank Facilities 235.00 CARE D/CARE D Reaffirmed
Long Term
Bank Facilities
(Fund Based
Limits) 220.00 CARE D Reaffirmed
Long Term
Bank Facilities
(Term Loan) 86.99 CARE D Reaffirmed
Detailed Rationale & Key Rating Drivers
The reaffirmation in the rating assigned to the bank facilities of
CMI factors in irregularities in the debt servicing for working
capital facilities attributable to weak liquidity position of the
company. The ratings takes cognizance of extension of LC usance
period from 180 days to 270 days/inter-changeability of non-fund
based limit to fund based limit by the lead bank till December 31,
2020 which regularized the earlier delinquencies, however the
continued weakening of liquidity which stems from delay in
receivables has led to continued delays in debt servicing for
working capital facilities.
Rating Sensitivities
Positive - Factors that could lead to positive rating
action/upgrade:
* Improvement in the liquidity position
* Improvement in the operational performance of the company
Detailed description of the key rating drivers
Key Rating Weaknesses
* Delays in servicing of debt obligations: Due to disruption in
the operations owing to the outbreak of Covid-19 pandemic which led
to low capacity utilization, reduction in sales and lower
collections weakened the liquidity profile of the company. In line
with RBI's directive for Covid relief, the lender sanctioned the
fund-based limits to tide over the temporary cash flow mismatches
and also extended the LC usance period from 180 days to 270
days/inter-changeability of non-fund based limit to fund based
limit up to June 30, 2020. However, these sanctions/extensions
expired after June resulting in irregularities in conduct of
account. Later, in October 2020, the lender has extended the
validity of these sanctions/extensions till December 31, 2020.
However, there are ongoing delays with some of the lenders due to
stretched liquidity position of the company on account of delay in
collection of payment from its customers.
* Weak operational performance during FY20 and Q1FY21: CMI's
operating performance was adversely impacted with 21.31% decline in
total operating income to INR511.24 crore in FY20 (PY: INR649.66)
and steep decline in profitability. The PAT margin of the company
declined significantly to 0.72% in FY20 from 6.92% in FY19, as
result of lower operating profit, higher deferred tax and increase
in interest cost as a result of debt funded capex done in FY20.
Further, in Q1FY21, the company reported significant decline in the
total operating income to INR22.83 crore (Q1FY20: INR152.04 crore),
the decline is mainly due to disruption in operations due to
outbreak of Covid-19. The company reported net loss of INR13.46
crore during Q1FY21 (Q1FY20: PAT of INR6.74 crore). The collection
from debtors stood significantly low during H1FY21 (refers to the
period April 01 to September 30). The average utilization of fund
based limits for the trailing 7 months period ending September,
2020 stood high at ~87%.
* Working capital intensive operations: CMI is a 100% B2B company
with significant revenue from PSUs. The agreed payment terms in
government contracts are between 90-120 days which actually
stretches up to 200 days. Resultantly, average collection period of
the company stood high at 182 days during FY20 (PY: 141 days).
Moreover, as these entities buy the final stock only post
inspection, the CMI's inventory holding period in FY20 stood at 146
days (PY: 95 days), the increase in inventory holding period is
mainly because the company was unable to dispatch several order in
the month of March, 2020 as pre-inspection was stopped by the
clients due to Covid-19.
* Susceptibility of margins to volatility in raw material prices:
CMI's business is raw material intensive with raw material costs
forming majority of its total operating cost. Primary raw materials
for CMI are copper and aluminium forming more than 60% of total raw
material costs, prices of which are highly volatile. However,
contracts typically incorporate a price variation clause (PVC)
where a company passes on any volatility in the underlying
commodity without impacting its margins. The purchase prices are
benchmarked to international indices such as London Metal Exchange
(LME). During bidding for the government contracts, CMI
incorporates the ruling rate of commodities in the bidding price.
* Competition in the cable industry: The Indian cable industry is
highly competitive and fragmented with a large number of cable
producers in both organized and unorganized sector, leading to the
pressure on prices. However, CMI being in existence for over three
decades in the cable industry has proven product quality standards
for supply of niche cable products and CMI has an advantage with
key approvals from the Indian Railways, SEBs, BHEL, NTPC, oil
refinery companies etc as pre-qualification criteria for most
government projects is stringent. This creates a huge entry
barrier as a new player will take anywhere between 1 and 4 years to
qualify.
Liquidity: Poor
The temporary closure of business operations due to lockdown has
squeezed CMI's liquidity. The company has been granted moratorium
by its working capital and term loan lenders towards payment of
interest and instalments in line with RBI's Covid-19 relief scheme.
Besides, the company has also been granted ad-hoc limits of INR7.50
crore from its bankers. The counter party risk is low for the
company as majority of its customers are PSUs, however, delays in
payments from the customers led to cash flow mismatches. The
company was extended relief in form of interchangeability between
and fund and non-fund based limits and extension of usance period
of LC from 180 days to 270 days till December 31, 2020, however,
slower than anticipated recovery in business operations, inability
to procure raw material and stretched receivables have led to
continued irregularities in the working capital facilities beyond
30 days.
CMI Ltd. was incorporated in 1967 under the name of Choudhari Metal
Industries Private Limited. CMI Limited was taken over by the
present promoter Mr. Amit Jain in 2007. CMI is a B2B
multi-specialty cable manufacturer and is engaged in the
manufacturing of cables for various industries in segments such as
railways, utilities, oil and gas, petrochemical, energy,
industrial, power amongst others. The product range of CMI includes
signaling, instrumentation, control, power, telecommunication
cables etc. CMI has two manufacturing facilities one located in
Faridabad, Haryana and the other at Baddi, Himachal Pradesh with
installed capacity of 47,000 km and 1,93,140 km respectively as on
March 31, 2020. On February 29, 2016, CMI has acquired 100%
shareholding of CMI Energy India Private Limited (CMIE; formerly
known as General Cable Energy Private Limited) from a Fortune 500
company- General Cable Corporation, USA. The operations commenced
from April, 2016 at Baddi manufacturing facility.
DEWAN HOUSING: ICRA Reaffirms D(SO) Rating on INR8.73cr Bank Debt
-----------------------------------------------------------------
ICRA has reaffirmed ratings on certain bank facilities of Dewan
Housing Finance Corporation Limited (DHFL), as:
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
DHFL Mortgage 8.73 [ICRA]D(SO); Reaffirmed
Loan Pool D.A.
Jan-12
DHFL Mortgage 73.68 [ICRA]D(SO); Reaffirmed
Loan Pool D.A.
Feb-12
DHFL Mortgage 33.27 [ICRA]D(SO); Reaffirmed
Loan Pool D.A.
Feb-12 II
Nirmaan RMBS 33.20 [ICRA]BB(SO); remains under
Trust Series I Rating Watch with Developing
2013 Implications
PTC Series A1
Nirmaan RMBS 33.10 [ICRA]BB(SO); remains under
Trust Series I Rating Watch with Developing
2013 Implications
PTC Series A2
Nirmaan RMBS 167.70 [ICRA]D(SO); Reaffirmed
Trust Series I
2017
PTC Series A1
Nirmaan RMBS 16.47 [ICRA]D(SO); Reaffirmed
Trust Series I
2017
Second Loss
Facility (SLF)
Nirmaan RMBS 125.88 [ICRA]BB(SO); remains under
Trust Series II Rating Watch with Developing
2017 Implications
PTC Series A1
Rationale
The pass-through certificates (PTCs) and purchaser payouts
originated by Dewan Housing Finance Corporation Limited (DHFL;
rated [ICRA]D) are backed by home loan receivables. Despite healthy
collections witnessed in the underlying pools, ratings for all the
above-mentioned transactions remain constrained due to the ongoing
bankruptcy proceedings against DHFL. For the transactions rated
[ICRA]D(SO) (viz. Jan-12, D.A. Feb-12, D.A. Feb-12 II and Nirmaan
Series I 2017), the ratings reaffirmation is on account of the
operational delays in meeting timely payouts on the scheduled
payout dates. For the transactions rated [ICRA]BB(SO) (under rating
watch with developing implications) (viz. Nirmaan Series I 2013 and
Nirmaan Series II 2017), the investor in the transactions has taken
over the servicing role and the PTC payouts so far have been met in
a timely manner. However, due to the bankruptcy proceedings, the
cash collateral (CC) for all the rated transactions remains under
moratorium and is not available to meet any shortfall in the PTC
payouts till the resolution process for DHFL is successfully
completed or the regulations clarify the availability of the CC for
meeting such shortfall. ICRA notes that due to moderate-to-high
amortisation in the transactions, credit enhancement cover has
built-up over the future PTC pay-outs. The break-even collection
efficiency is also adequate when compared to the actual collection
level observed in the pool.
Key rating drivers
Credit strengths
* Robust collection performance seen in all the pools till October
2020 (pay-out month)
* Availability of credit enhancement in the form of excess interest
spread (EIS) in the transactions
Credit challenges
* Operational delay in meeting timely pay-outs for four
transactions (for Jan-12, Feb-12 I, Feb-12 II, Mar-17 I pools)
* Ongoing insolvency proceedings against DHFL has resulted in a
moratorium on the cash collateral (CC); resolution on
this matter would be critical
Description of key rating drivers highlighted above
The performance of the pools has been strong, despite the severe
weakening of the credit profile of the originator (DHFL), with
healthy cumulative collection efficiency after meeting the October
2020 pay-outs. The cumulative collection efficiency has been above
98% for all the pools till October 2020 pay-outs. Any shortfall in
the collections has been absorbed by the excess interest spread
(EIS) in the structure. Further, during the moratorium period, PTC
investor in the Nirmaan Series I 2013 and Nirmaan Series II 2017
transactions granted a moratorium to the underlying contracts in
line with the 'Covid-19 Regulatory Package' announced by the
Reserve Bank of India (RBI). The PTC investor pay-outs were also
modified wherein the credit enhancement was not to be used for
pay-outs during the moratorium period (April 2020 to September 2020
pay-outs).
In November 2019, the Reserve Bank of India (RBI) had referred DHFL
for bankruptcy proceedings under the Insolvency and Bankruptcy
(Insolvency and Liquidation Proceedings of Financial Service
Providers and Application to Adjudicating Authority) Rules, 2019
which was admitted by the National Company Law Tribunal (NCLT) in
December 2019. The RBI superseded DHFL's board of directors and an
administrator was appointed, assisted by an Advisory Committee. The
transactions where DHFL continues to be the servicer (Jan-12, D.A.
Feb-12, D.A. Feb-12 II and Nirmaan Series I 2017) continue to face
delays in funding the C&P Accounts by a few days. For the
transactions where the investor has taken over the servicing role
(Nirmaan Series I 2013 and Nirmaan Series II 2017) the rating is
constrained due to inability of the Trustee to utilise the CC in
case of any shortfall in pool collections. This is due the ongoing
bankruptcy proceedings against DHFL whereby the CC has been
considered as the company's asset and hence is under moratorium.
Key rating assumptions
* ICRA's cash flow modelling for the surveillance of mortgage:
backed securitisation (MBS) transactions involves the simulation of
potential delinquencies, losses (shortfall in principal collection
during the balance tenor of the pool) and prepayments in the pool.
Additionally, the assumptions are adjusted to factor in the current
operating environment and any industry-specific factors that ICRA
believes could impact the performance of the underlying pool
contracts. However, the ratings for the above transactions are
constrained on account of the operational delays being seen in
timely funding of the C&P Account for four transactions coupled
with the unavailability of the CC to meet any PTC shortfalls for
all transactions.
Liquidity position: Stretched (for Nirmaan Series I 2013, and
Nirmaan Series II 2017 pools)
Despite collections being healthy, the liquidity for the
transactions is stretched as the moratorium on the CC impairs the
ability of Trustee to utilise it in case of a shortfall in the pool
collections in any month.
Liquidity position: Poor (for D.A. Jan-12, D.A. Feb-12, D.A. Feb-12
II and Nirmaan Series I 2017 pools) The liquidity for the
transactions is poor due to the operational delays in funding C&P
account in a timely manner and the moratorium on the CC.
Rating sensitivities
* Positive triggers (for all rated transactions): For any rating
upgrade, successful resolution of DHFL and/or lifting of the
moratorium on the CC would be important. Further, funding of the
C&P Accounts in a timely manner, on a sustained basis would be
critical.
* Negative triggers (for Nirmaan Series I 2013 and Nirmaan Series
II 2017): Pressure on the ratings could emerge in case the monthly
collections start to deteriorate.
Analytical approach
The rating actions are based on the performance of the pools till
September 2019 (collection month), the present delinquency levels
and the credit enhancement available in the pools, and the
performance expected over the balance tenure of these pools.
Dewan Housing Finance Corporation Limited (DHFL) was incorporated
as Dewan Housing and Leasing Company Limited in 1984. Its name was
changed to Dewan Housing Development Finance Limited in 1984 and
subsequently to Dewan Housing Finance Corporation Limited in 1992.
With the merger of First Blue Home Finance Limited (FBHFL) with
DHFL in FY2013, DHFL extended its offerings to the higher ticket
size segment of more than INR10 lakh. It focused on the low and
middle income customer segment.
FORTIS HEALTHCARE: ICRA Keeps D Debt Ratings in Not Cooperating
---------------------------------------------------------------
ICRA said ratings for the INR990.00-crore bank facilities of Fortis
Healthcare Holdings Private Limited continue to remain under
'Issuer Not Cooperating' category'. The ratings are denoted as
"[ICRA]D/D ISSUER NOT COOPERATING".
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long Term- 490.00 [ICRA]D ISSUER NOT COOPERATING;
Bonds/NCD/LTD Rating continues to remain in
the 'Issuer Not Cooperating'
category
Commercial 500.00 [ICRA]D ISSUER NOT COOPERATING;
Paper/STD Rating continues to remain in
the 'Issuer Not Cooperating'
category
ICRA has been trying to seek information from the entity so as to
monitor its performance, but despite repeated requests by ICRA, the
entity's management has remained non-cooperative. The current
rating action has been taken by ICRA basis best available
information on the issuers' performance. Accordingly, the lenders,
investors and other market participants are advised to exercise
appropriate caution while using this rating as the rating may not
adequately reflect the credit risk profile of the entity. The
rating action has been taken in accordance with ICRA's policy in
respect of non-cooperation by a rated entity available at
www.icra.in.
Fortis Healthcare Holdings Private Limited (FHHPL) is a
holding/investment company, controlled by promoters of Religare
Enterprises and Fortis Healthcare Limited, Mr Malvinder Mohan Singh
and Mr. Shivinder Mohan Singh. FHHPL holds stake in multiple
companies/assets of Mr. Malvinder Singh, Mr. Shivinder Singh and
their associates. FHHPL, is in turn held by RHC Holding Private
Limited (RHC) and Oscar Investments Limited (Oscar), both of which
are promoter holding companies.
GMW ENGINEERS: Ind-Ra Cuts LT Issuer Rating to BB, Outlook Stable
-----------------------------------------------------------------
India Ratings and Research (Ind-Ra) has downgraded GMW Engineers
Private Limited's (GEPL) Long-Term Issuer Rating to 'IND BB' from
'IND BB+'. The Outlook is Stable.
The instrument-wise rating actions are:
-- INR12 mil. Fund-based limits Long-term rating downgraded;
Short-term rating affirmed with IND BB/Stable /IND A4+
rating;
-- INR105 mil. Non-fund-based limits affirmed with IND A4+
rating; and
-- INR4 mil. Term loan due on March 24 downgraded with IND
BB/Stable rating.
KEY RATING DRIVERS
The downgrade reflects GEPL's continued small scale of operations,
as reflected by the revenue of INR137 million in FY20 (FY19: INR134
million). The revenue increased marginally in FY20 as a result of
slow-paced execution of orders and weak order book position during
the previous year. As of November 22, 2020, the company had
achieved a turnover INR47 million and had an outstanding order book
of INR146 million (1.07x FY20 revenue).
The ratings factor in GEPL's modest EBITDA margins, since it mainly
undertakes small sized sub-contract works. The margin expanded to
12% in FY20 (FY19: 11%) due to lower raw material prices. The
company's return on capital employed was 10.95% in FY20 (FY19:
9.6%).
Liquidity Indicator - Stretched: GEPL's cash and cash equivalents
remained weak at INR0.35 million, with total outstanding debt of
INR20 million at FYE20. The company's cash flow from operations
turned positive INR4 million in FY20 (FY19: negative INR8 million)
due to an improvement in the absolute operating EBITDA to INR16.5
million (INR14.7 million) and favorable changes in working capital.
The average cash credit utilization was 84% and bank guarantee
utilization at 60% during the 12 months ended October 2020. The
company's net cash cycle elongated to 138 days during FY20 (FY19:
120 days) due to an increase in its inventory days to 92 days (7
days) and decrease in creditor days to 62 (91). The company's
working capital cycle has been elongated since inception due to its
capital-intensive nature of operations.
The ratings also continue to factor in the company's moderate
credit metrics. The company's interest coverage (operating
EBITDA/gross interest expense) deteriorated to 3.4x in FY20 (FY19:
3.6x) due to an increase in its interest expenses to INR4.9 million
(INR4.1 million). Its net leverage (total adjusted debt/operating
EBITDAR) improved slightly to 1.2x in FY20 (FY19: 1.3x) due to the
increase in its absolute EBITDA. The agency expects the GEPL to
maintain credit metrics at current levels in FY21 due to the
absence of any major debt-led capex plans.
The ratings, however, are supported by the promoters' experience of
more than 30 years in executing engineering, procurement and
construction contracts.
RATING SENSITIVITIES
Negative: The company's continued small scale of operations on
account of the order book sustaining below 1.3x FY20 revenue,
decline in the EBITDA margins and/or a further elongation of the
net working capital cycle, leading to deterioration in liquidity
profile, will result in a negative rating action.
Positive: An improvement in the order book (above 1.5x FY20
revenue), revenue and operating EBITDA, leading to an improved
liquidity profile, will result in upgrade in the ratings.
COMPANY PROFILE
Incorporated in 1986, GEPL installs hydro-mechanical and water
intake equipment such as hydel gates, stop log gates, and piping
work for various power projects, mainly hydro power projects. The
work includes designing, supply and installation of steel
structures for meeting the demands of projects. The company
undertakes 100% sub-contract works for hydro power civil
contractors.
GOPAL OIL: ICRA Lowers Rating on INR9.90cr Cash Loan to D
---------------------------------------------------------
ICRA has revised the ratings on certain bank facilities of Gopal
Oil Industries, as:
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Fund based- 9.90 [ICRA]D ISSUER NOT COOPERATING;
Cash Credit Rating downgraded from
[ICRA]B(Stable) ISSUER NOT
COOPERATING and Continues to
Remain under the 'Issuer Not
Cooperating' category
Rationale
The rating downgrade reflects delays in debt servicing as mentioned
in publicly available sources. The rating is based on limited
information on the entity's performance since the time it was last
rated in August 2019. The lenders, investors and other market
participants are thus advised to exercise appropriate caution while
using this rating as the rating may not adequately reflect the
credit risk profile of the entity, despite the downgrade.
As part of its process and in accordance with its rating agreement
with Gopal Oil Industries, ICRA has been trying to seek information
from the entity so as to monitor its performance, but despite
repeated requests by ICRA, the entity's management has remained
non-cooperative. In the absence of requisite information and in
line with SEBI's Circular No. SEBI/HO/MIRSD4/CIR/2016/119, dated
November 1, 2016, ICRA's Rating Committee has taken a rating view
based on the best available information.
Gopal Oil Industries is a proprietorship concern and was
incorporated in 1990. The firm started operations with two oil
expellers at Pandhurna in the state of Madhya Pradesh. The
manufacturing operations were expanded over the years and the firm,
as on date, has 18 oil expellers/crushers currently, a caustic wash
section and a groundnut shelling plant.
INDO NABIN: CARE Reaffirms D Rating on INR9.50cr LT Loan
--------------------------------------------------------
CARE Ratings reaffirmed ratings on certain bank facilities of Indo
Nabin Projects Limited (INPL), as:
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long Term Bank 9.50 CARE D Rating removed from
Facilities ISSUER NOT COOPERATING category
and Reaffirmed
Long Term/ 19.00 CARE C; Stable/CARE A4 Rating
Short Term removed from ISSUER NOT
Bank Facilities COOPERATING category and
Reaffirmed
Short Term 2.89 CARE D Rating removed from
Bank Facilities ISSUER NOT COOPERATING category
and Reaffirmed
Detailed Rationale & Key Rating Drivers
CARE had placed the ratings assigned to the bank facilities of INPL
under Issuer not Cooperating vide its press release dated April 7,
2020 as INPL had not paid the surveillance fees for the rating
exercise agreed to in its Rating Agreement. On cooperation by the
company, CARE has reassigned ratings to its bank facilities.
The ratings are constrained by delay in debt servicing with one of
the lenders, significant decline in scale of operations in FY20
(refers to the period April 1 to March 31) with net loss incurred
by the company, continued high receivables level, decline in order
book position, weak debt-protection metrics and exposure to
volatility in input prices. The ratings also factor in the gradual
reduction in debt level by the company, experience of the promoters
in the industry and stable demand outlook.
Rating Sensitivities
Positive factors - Factors that could lead to positive rating
action/upgrade:
* Increase in the scale of operations on a sustained basis with
improvement in PBILDT margins leading to improvement in debt
coverage indicators.
* Successful biding of new orders and timely execution of the order
book.
* Improvement in working capital cycle below 500 days.
* Improvement in liquidity position.
Negative Factors - Factors that could lead to negative rating
action/downgrade:
* Inability to improve profitability or realise pending dues
leading to further deterioration in liquidity.
Detailed description of the key rating drivers
Key Rating Weakness
* Delays in debt servicing: There are delays in servicing of the
funded interest term loan (FITL) from one of the lenders due to
weak liquidity position of the company. The company had availed of
deferment of interest on cash credit account in terms of the
Covid-19 Regulatory Package of the Reserve Bank of India (RBI) from
March 2020 to August 2020 from its lenders. The said interest was
converted into FITL in September.
* Decline in financial performance in FY20: The operating income
substantially reduced to INR23.96 crore in FY20 (prov) as against
INR59.38 crore in FY19 on account of lower execution of existing
orders and absence of fresh orders during the year. Further, there
was revision in scope of work in some orders which resulted in
decline in order book. The company incurred operating loss of
INR8.43 crore in FY20 (provisional) on account of under-absorption
of fixed costs along with cost overrun in raw material consumption
due to theft and pilferage in some of the projects. The company
reported net loss of INR16.49 crore in FY20 (provisional) as
against net profit of INR2.00 crore in FY19. In Q1FY21, the company
did not achieve any significant revenue due to COVID-19. However,
in H1FY21, it has achieved operating income of about INR10 crore.
* Decline in order book position: The outstanding order book of the
company substantially reduced to INR23.74 crore as on August 31,
2020 from INR77.59 crore February 29, 2020. The reduction was due
to absence of any major orders during FY20 and revision in scope of
work in some large orders at the instance of the customer.
* Elongation of average collection period: The operating cycle of
the company remained high and increased from 377 days in FY19 to
746 days in FY20 (provisional) on account of higher average
collection period and decline in operating income. However, on
absolute level, overall debtors reduced to INR39.30 crore in FY20
from INR58.09 crore in FY19. The average inventory period also
remained high at 132 days in FY20 (142 days in FY19).
* Weak debt-protection metrics: The overall gearing of the company
was high at 1.70x as on March 31, 2020. Total debt/GCA remained
weak on account negative GCA in FY20. Further, the interest
coverage was also negative in FY20.
* Volatility in input prices: Raw material cost incurred by the
company accounted for about 50% of total cost of sales in FY20
(prov). The major components of raw material consumed by INPL
include steel, aluminium, copper, etc. which are subject to price
fluctuations and can impact profitability. INPL incorporates price
escalation clause in all of its contracts which hedges it from
adverse variances in cost to a certain extent.
Key Rating Strength
* Experienced promoters: INPL, incorporated on 1978, was promoted
by Mr. Amalendu Sen (an electrical engineer from IIT Kharagpur),
having around five decades of experience in the field of electrical
turnkey project execution and Mr. R. Chandramouli. All directors of
INPL are professionally qualified and involved in the field of
execution of electrical installation for more than three decades.
Going forward, the company proposes to utilise its credentials to
garner orders through joint ventures.
* Gradual reduction in debt level: The overall debt level
substantially reduced to INR37.86 crore as on March 31, 2020 from
Rs.57.98 crore as on March 31, 2019. INPL has reduced debt during
FY20 through collections received from long pending debtors and
through sale of fixed assets.
* Stable demand outlook: In Union Budget 2020-21, INR15,875 crore
was allocated to the Ministry of Power and INR5,500 crore to Deen
Dayal Upadhyay Gram Jyoti Yojana (DDUGJY) which, in turn, will
provide opportunities in power generation, distribution,
transmission and equipment. The company providing engineering &
construction services for electrification projects primarily under
DDUGJY scheme of the Government of India.
Liquidity: poor
The liquidity of the company is poor which is reflected through
high utilisation of working capital limits and inability to timely
service the FITL with one lender. The average month-end tilization
of fund based limits remained high at about 91% through the past 12
months ended August 2020 and one of the cash credit accounts had
overdrawals upto March, 2020. During FY20, INPL liquidated fixed
assets of around INR10 crore to support the liquidity of the
company. In FY21, realisation from debtors is expected to support
liquidity.
INPL, which is promoted by Mr. Amalendu Sen & Mr. R. Chandramouli,
is a construction company engaged in providing engineering &
construction services (which includes design & engineering, supply
of materials, erection & maintenance and commissioning of
sub-stations (33/11KV)) for electrification projects primarily
under DDUGJY scheme of the Government of India. The company
specializes in execution of electrical construction contracts on
turnkey basis and has executed several contracts involving ETC
(Erection, Testing and Commissioning) of sub-stations and operation
& maintenance projects.
JET AIRWAYS: Plans to Resume Services by Summer 2021
----------------------------------------------------
Ragini Saxena at Bloomberg News reports that Jet Airways India
Ltd., once India's biggest airline by market value, is planning to
restart operations as a full-service carrier by the summer of 2021,
its new owners announced.
A consortium led by Dubai-based entrepreneur Murari Lal Jalan and
Kalrock Capital has set a revival plan for Jet Airways, which
includes a dedicated freighter service and hubs in small Indian
cities beyond Delhi, Mumbai, and Bengaluru, Bloomberg relates. Jet
Airways will operate all its historic domestic slots in India and
restart international operations after it receives approval from
Indian regulators and a bankruptcy tribunal, according to a
statement on Dec. 7, Bloomberg relays.
"Jet Airways has been a brand with a glorious history of over 25
years, and it is the vision of the consortium to put Jet Airways
back in the skies at the earliest opportunity," Bloomberg quotes
Manoj Narender Madnani, board member of the Jalan Kalrock
consortium, as saying in the statement.
Once, India's largest carrier by number of passengers, Jet Airways
went into bankruptcy in 2019 after it failed to repay mounting
debt. Jet Airways has almost 21,000 creditors seeking claims of
around $6 billion and has had most of its landing slots
confiscated.
The consortium had evaluated the option of starting a new airline
but Jet Airways' optimal flight slots, brand value and reputation
for in-flight service and safety will give the carrier "an edge
over others," according to the statement cited by Bloomberg.
About Jet Airways
Based in Mumbai, India, Jet Airways (India) Limited was one of
India's top airlines founded by Naresh Goyal. It provided
passenger and cargo air transportation services as well aircraft
leasing services. It operated flights to 66 destinations in India
and international countries.
Jet Airways on April 17, 2019, halted all flight operations after
its lenders rejected its plea for emergency funds.
On June 20, 2019, the National Company Law Tribunal (NCLT), Mumbai
Bench, accepted an insolvency petition against Jet Airways filed by
its creditors as they attempt to recover some of their dues.
Ashish Chhawchharia of Grant Thornton India has been named as the
resolution professional in the case. Law firm Cyril Amarchand
Mangaldas will represent the interests of the lenders' consortium,
according to a Reuters report.
Creditors have filed claims worth INR30,907 crore, according to
Financial Express. The RP has so far admitted claims worth over
INR14,000 crore.
Jet Airways would be acquired by an investor consortium under a
multi-million dollar resolution plan approved by the carrier's
creditors on Oct. 17, 2020.
JINDAL GREEN: CARE Lowers Rating on INR12cr LT Loan to C
--------------------------------------------------------
CARE Ratings revised the ratings on certain bank facilities of
Jindal Green Crop International Private Limited (JGCI), as:
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long Term Bank 12.00 CARE C; Stable; ISSUER NOT
Facilities COOPERATING; Rating continues
to remain under ISSUER NOT
COOPERATING category and
Revised from CARE B; Stable
Short Term Bank 40.00 CARE A4; ISSUER NOT
Facilities COOPERATING; Rating continues
to remain under ISSUER NOT
COOPERATING category
Detailed Rationale & Key Rating Drivers
CARE had, vide its press release dated November 28, 2019, placed
the rating(s) of JGCI under the 'issuer non-cooperating' category
as Jindal Green Crop International Private Limited had failed to
provide information for monitoring of the rating. Jindal Green Crop
International Private Limited continues to be noncooperative
despite repeated requests for submission of information through
e-mails, phone calls and a email dated October 30, 2020, October
28, 2020, October 23, 2020 and October 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 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 revised by taking into account
non-availability of information (Financial Statements after FY16
are not available) and no due-diligence conducted due to non-
cooperation by Jindal Green Crop International Private Limited with
CARE'S efforts to undertake a review of the rating outstanding.
CARE views information unavailability 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 November 28, 2019, the following were
the rating strengths and weaknesses.
Key Rating Weaknesses
* Below Average financial risk profile: The Company has below
average financial risk profile marked by growing scale of
operations, declining profitability margins and leveraged capital
structure. Although, the total operating income of the company has
increased ~23% y-o-y but profitability margins have declined to
1.14x during FY16 (PY: 2.26x). The overall gearing of the company
also deteriorated and stood at 3.50x as on March 31, 2016 as
against 2.19x as on March 31, 2015 owing to relatively higher
utilization of working capital limits.
* Low value addition with highly fragmented industry structure and
low entry barriers: JGCI is involved in trading of a wide range of
pulses. There are several small operators which do not do end-to
end processing and merely procure and pass onto big traders or
processing houses.
* Short track record of operations: JGCI started its commercial
operations in September 2013 and therefore has a short track record
of operations. However, with promoter's experience and knowledge of
the products/markets through its group concern.
* Commodity price and currency risk: Since JGCI is engaged in the
sale of agro products, the company is exposed to the risk of agro
climatic conditions. As majority of the procurement is done through
imports without firm orders and JGCI maintains inventory of 2-3
months, it is also exposed to the changes in the commodity price
and foreign currency rates.
Key Rating Strengths
* Experienced promoters in the agro-based industry: JGCI is
promoted by Mr. Dalip Jindal and Mrs. Shaloo Jindal. The promoter's
family is into this business since 1953. The promoters have more
than 20 years of experience in the pulse trading business through
group companies. Established operations in pulses trading business
The company shares healthy relationship with its suppliers across
the globe and imports pulses from Australia, Canada, Burma, Russia,
etc. from suppliers such as Glencore Grain BV, Marina Commodities
Inc., Agromin Australia Pty Ltd, etc.
Incorporated in July 2013, Jindal Green Crop International Private
Limited (JGCI) was promoted by Mr. Dalip Jindal and Mrs. Shaloo
Jindal. JGCI imports pulses (Red Lentils, Chickpeas, Green Peas,
Yellow Peas, Pigeon Peas, Black Matpe, Green Moong, Lentils). JGCI
sells its products mostly in the domestic market through a network
of wholesale dealers and brokers. The other group companies SG
Polyplast Private Limited and Jindal Agro International are also
engaged in the similar line of business o f trading pulses. These
entities also supply to Government (for defence and Public
Distribution System in Haryana, Punjab and Himachal Pradesh) which
contributes about 25% of the combined business of the group.
JYOTI VINCOM: ICRA Keeps B- Debt Ratings in Not Cooperating
-----------------------------------------------------------
ICRA said ratings for the INR16.50 crore bank facilities of Jyoti
Vincom Private Limited continue to remain in the 'Issuer Not
Cooperating' category. The ratings are denoted as "[ICRA]B-
(Stable)/[ICRA]A4 ISSUER NOT COOPERATING".
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long Term- 7.10 [ICRA]B- (Stable) ISSUER NOT
Fund Based COOPERATING; Rating continues
Cash Credit to remain under 'Issuer Not
cooperating' category
Long Term- 8.82 [ICRA]B- (Stable) ISSUER NOT
Fund Based COOPERATING; Rating continues
Term Loan to remain under 'Issuer Not
cooperating' category
Short Term- 0.18 [ICRA]A4 ISSUER NOT
Non Fund COOPERATING; Rating continues
Based to remain under 'Issuer Not
Cooperating' category
Long Term/ 0.40 [ICRA]B- (Stable)/A4 ISSUER
Short Term- NOT COOPERATING; Rating
Unallocated continues to remain under
'Issuer Not Cooperating'
Category
ICRA has been trying to seek information from the entity so as to
monitor its performance, but despite repeated requests by ICRA, the
entity's management has remained non-cooperative. The current
rating action has been taken by ICRA basis best available/dated/
limited information on the issuers' performance. Accordingly, the
lenders, investors and other market participants are advised to
exercise appropriate caution while using this rating as the rating
may not adequately reflect the credit risk profile of the entity.
The rating action has been taken in accordance with ICRA's policy
in respect of non-cooperation by a rated entity available at
www.icra.in.
Incorporated in February 2009, Jyoti Vincom Private Limited (JVPL)
is promoted by the West Bengal-based Kundu family.The company
provides cold-storage facility to potato-growing farmers and
traders on a rental basis with a storage capacity of 19,668 metric
tonnes (MT). The company also provides a multipurpose storage
facility of 5,010 MT for storingdifferent variety of fruits and
vegetables like carrot, beet, apples, etc. The cold-storage unit is
located at Hooghly, West Bengal.
KARNIMATA COLD: ICRA Keeps B Debt Ratings in Not Cooperating
------------------------------------------------------------
ICRA said ratings for the INR12.00 crore bank facilities of
Karnimata Cold Storage Limited (Erstwhile Karnimata Cold Storage
Private Limited) continue to remain in the 'Issuer Not Cooperating'
category. The ratings are denoted as "[ICRA]B (Stable)/[ICRA]A4
ISSUER NOT COOPERATING".
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long Term-Fund 7.22 [ICRA]B (Stable) ISSUER NOT
Based/Cash COOPERATING; Rating continues
Credit to remain in the 'Issuer Not
Cooperating' category
Long Term-Fund 4.58 [ICRA]B (Stable) ISSUER NOT
Based Term Loan COOPERATING; Rating continues
to remain in the 'Issuer Not
Cooperating' category
Short Term-Non
Fund Based 0.20 [ICRA]A4 ISSUER NOT
COOPERATING; Rating continues
to remain under 'Issuer Not
Cooperating' category
ICRA has been trying to seek information from the entity so as to
monitor its performance, but despite repeated requests by ICRA, the
entity's management has remained non-cooperative. The current
rating action has been taken by ICRA basis best available/dated/
limited information on the issuers' performance. Accordingly, the
lenders, investors and other market participants are advised to
exercise appropriate caution while using this rating as the rating
may not adequately reflect the credit risk profile of the entity.
The rating action has been taken in accordance with ICRA's policy
in respect of non-cooperation by a rated entity available at
www.icra.in.
Karnimata Cold Storage Limited (Erstwhile Karnimata Cold Storage
Private Limited) (KCSL) had set up its cold storage unit at West
Medinipur, West Bengal in 2012, to carry out the business of
storage and preservation of potatoes. KCSL has a storage capacity
of 25,814 metric tonnes (MT) at present.
KOMARLA HATCHERIES: Ind-Ra Cuts LongTerm Issuer Rating to 'BB-'
---------------------------------------------------------------
India Ratings and Research (Ind-Ra) has downgraded Komarla
Hatcheries' (KH) Long-Term Issuer Rating to 'IND BB-' from 'IND BB
(ISSUER NOT COOPERATING)'. The Outlook is Stable.
The instrument-wise rating actions are:
-- INR166.0 mil. (reduced from INR114.4 mil.) Term loan due on
May 2026 downgraded with IND BB-/Stable rating; and
-- INR95.0 mil. Fund-based facilities Long-term rating
downgraded; short-term rating affirmed with IND BB-
/Stable/IND A4+ rating.
The downgrade reflects KH's EBITDA and net losses in FY20 and the
consequent deterioration in its credit metrics, due to a sharp
decline in broiler chicken realization during February-March 2020.
The profit and profit margins of the firm are susceptible to highly
volatile broiler realizations due to the seasonal demand of poultry
products in India and volatile feed prices, which are driven
primarily by agro-climatic conditions and demand-supply dynamics.
The ratings are also constrained by the inherent risk of disease
outbreaks and the highly competitive and fragmented industry, which
limits its bargaining power.
KEY RATING DRIVERS
KH's EBITDA margins turned negative 22.2% in FY20 (FY19: 9.23%) due
to the EBITDA losses of INR168 million (INR72.9 million) and an
increase in raw material prices. The cost of goods sold increased
to 107% in FY20 (FY19: 77.14%) and were volatile in the range of
9.23%-19.3% during FY18-FY20. The EBITDA losses led to KH's
interest coverage (operating EBITDA/gross interest expense)
deteriorating to negative to 3.9x in FY20 (FY19: 2.45x) and net
leverage (adjusted net debt/operating EBITDA) worsening negative to
2.49x (3.8x). FY20 financials are provisional. The firm achieved
EBITDA of INR45 million for 7MFY21.
Ind-Ra expects the EBITDA and credit metrics of the firm to become
positive in FY21, backed by a softening of raw material prices.
Though the firm is planning to set up another poultry farm by
incurring capex of INR135 million, of which 75% would be debt
funded while the rest would be brought by the promoter, the credit
metrics would be above the FY20 levels.
The ratings continue to factor in KH's continued small scale of
operations with a decline in the revenue to INR758.6 million (FY19:
INR789.6 million) due to highly volatile broiler realizations. KH's
98% revenue is contributed by the sale of day-old chicks and the
remaining 2% of the revenue is contributed by the sale of cull
parents and manure. The firm achieved revenue of INR400 million for
7MFY21.
Liquidity Indicator – Stretched: KH's average maximum utilization
of the fund-based limits was 97.5% for the 12 months ended October
2020. Its cash flow from operations turned negative INR99 million
in FY20 (FY19: INR14.8 million) owing to the EBITDA loss.
Furthermore, the firm does not have any capital market exposure and
relies on banks to meet its funding requirements. The net cash
cycle improved to 23 days in FY20 (FY19:80days), on account of an
increase in creditors period to 83 days (24 days) and a reduction
in inventory days to 76 (82). Additionally, the firm had a low
unencumbered cash balance of INR7.08 million at FYE20 (FYE19:
INR10.5 million). The firm had availed the Reserve Bank of
India-prescribed moratorium over March to August 2020 under the
COVID-19 relief package.
The ratings are further supported by the firm's established track
record of over four decades and the promoters' over five decades of
experience in the poultry industry.
RATING SENSITIVITIES
Negative: A fall in the revenue, EBITDA margin and deterioration in
the credit metrics leading to net leverage above 5.0x and/or stress
in the liquidity position, all on a sustained basis, could be
negative for the ratings.
Positive: An increase in the revenue and EBITDA margin leading to
an improvement in credit metrics, and an improvement in liquidity,
all on a sustained basis, could be positive for the ratings.
COMPANY PROFILE
KH is a Bengaluru-based partnership firm that is engaged in the
poultry business in Karnataka, Tamil Nadu and Kerala.
KOVAI KALAIMAGAL: CARE Keeps D Debt Ratings in Not Cooperating
--------------------------------------------------------------
CARE Ratings said the rating for the bank facilities of Kovai
Kalaimagal Educational Trust (KKET) continues to remain in the
'Issuer Not Cooperating' category.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long Term Bank 5.66 CARE D; ISSUER NOT COOPERATING
Facilities Rating continues to remain
under ISSUER NOT COOPERATING
category
Short Term Bank
Facilities 0.14 CARE D; ISSUER NOT COOPERATING
Rating continues to remain
under ISSUER NOT COOPERATING
category
Detailed Rationale & Key Rating Drivers
CARE had, vide its press release dated placed August 19, 2019 the
rating(s) of KKET under the 'Issuer non-cooperating' category as
KKET had failed to provide information for monitoring of the
rating. KKET continues to be non-cooperative despite repeated
requests for submission of information through e-mails, phone calls
and email dated October 28, 2020. In line with the extant SEBI
guidelines, CARE has reviewed the rating on the basis of the best
available information which however, in CARE's opinion is not
sufficient to arrive at a fair rating.
Users of this rating (including investors, lenders and the public
at large) are hence requested to exercise caution while using the
above rating.
Detailed description of the key rating drivers
At the time of last rating on August 19, 2019, the following were
the rating strengths and weaknesses:
Key Rating Weakness
* Ongoing Delays in debt servicing: There are on-going delays in
meeting the debt obligations since the trust faces liquidity issues
arising from delay in fee collection.
Kovai Kalaimagal Educational Trust (KKET) was set up as a
charitable trust under section 12A of Income Tax Act by Mr K.
AChinnaraju and Mrs P. Shanmugadevi of Coimbatore, Tamil Nadu in
the year 1992. The trust currently operates four educational
institutes:
1. Kovail Kalaimagal College of Arts & Science (KKCAS)
2. Coimbatore Institute of Management & Technology (CIMAT)
3. Coimbatore Institute of Engineering & Technology (CIENT)
4. Kovai Kalaimagal Matriculation School (from K-10)
KRISHNASHRAY (INDIA): CARE Keeps C Debt Rating in Not Cooperating
-----------------------------------------------------------------
CARE Ratings said the rating for the bank facilities of Shri
Krishnashray (India) Private Limited (SKIPL) continues to remain in
the 'Issuer Not Cooperating' category.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long Term 10.09 CARE C; Stable; ISSUER NOT
Bank Facilities COOPERATING Rating continues
to remain under ISSUER NOT
COOPERATING category
Detailed Rationale & Key Rating Drivers
CARE had, vide its press release dated October 31, 2019, placed the
rating(s) of SKIPL under the 'issuer non-cooperating' category as
SKIPL had failed to provide information for monitoring of the
rating. SKIPL continues to be non-cooperative despite repeated
requests for submission of information through e-mails, phone calls
and a letter dated October 19, 2020. In line with the extant SEBI
guidelines, CARE has reviewed the rating on the basis of the best
available information which however, in CARE's opinion is not
sufficient to arrive at a fair rating.
Users of this rating (including investors, lenders and the public
at large) are hence requested to exercise caution while using the
above rating.
Rating continues to be constrained by modest & fluctuating scale of
operations, low profitability coupled with net losses during last 4
years ended FY19 (refers to the period April 1 to March 31), highly
leveraged capital structure & weak debt coverage indicators,
working capital-intensive nature of operations and significant
customer concentration risk. The rating, however, derives strength
from company's long track record of over two decades of operations
in manufacturing of modular switches, step lights & LED lights,
highly experienced & resourceful promoters with an average of three
decades of experience in the aforementioned activities.
Detailed description of the key rating drivers
At the time of last rating on October 31, 2019 the following were
the rating strengths and weaknesses (updated for the information
available from Registrar of Companies):
Detailed description of Key rating drivers
Key rating Weakness
* Modest & fluctuating scale of operations: The total operating
income has improved by 9.45% and stood at INR21.20 crore in FY19 as
compared to INR19.37 crore in FY18 on account of higher demand
received from existing customers and coupled with addition of new
customers. Nevertheless, the scale of operations continues to
remain modest. Given this, coupled with accumulated losses over the
past, the tangible net-worth has eroded.
* Low profitability coupled with net losses during last 4 years
ended on FY19: The operating margin of the company has remained
fluctuating in the range of 9% to 18% during last four years ending
FY19 on account of volatile prices of raw materials viz. brass,
poly carbonate (derivative of petroleum), silver, etc., Moreover,
led by higher depreciation & interest costs, given the high capital
intensity coupled with high reliance on external debt, the company
posted a net losses during last four years ended FY19.
* Leveraged capital structure and weak debt coverage indicators:
SKIPL's capital structure is leveraged due to high dependence on
external borrowings to support the operation. Furthermore, company
is highly dependent on its working capital bank borrowings to
support liquidity requirements. The aforementioned reason leads to
high interest costs and subsequently weak debt coverage
indicators.
* Working capital intensive nature of operations: SKIPL's
operations are working capital intensive in nature due to funds
being blocked in inventory and receivables. However collection and
inventory period has improved in FY20 owing to better management
techniques adopted by the company, on the other hand creditors
period has shorten on account of prompt payments make to their
suppliers in order to receive timely required raw material, On
account of this, the utilization of the working capital limit
remained high.
Liquidity position - Poor: Poor liquidity marked by lower accruals
when compared to repayment obligations, fully utilized bank limits
and modest cash balance. This could constrain the ability of the
company to repay its debt obligations on a timely basis.
Key rating Strengths
* Long track record of the operations: SKIPL possesses a long track
record of over two decades of operations in the manufacturing
activities of modular switches, step lights and LED lights at its
manufacturing facility located at Bhimpore, Nani Daman. The various
types of modular switches manufactured by it are sold under the
brands 'Jewelite', 'Aryan', 'Jash' and 'Vesta' depending upon the
type and the end-user class catered to. Highly experienced
promoters: The overall operations of SKS are looked after by Mr.
Jagat Killawala with his wife Mrs Charu Killawala. Mr. Jagat
Killawala possesses a total experience of over four decades mainly
into the manufacturing activities of various types of switches. On
the other hand, Mrs Charu Killawala possesses a total experience of
over 20 years in the same field.
Incorporated in 2001 by Mr. Jagat Killawala with his wife Mrs Charu
Killawala, SKIPL (erstwhile Shri Krishnashray, proprietorship
entity established in 1996, later converted into a private limited
company in 2001) is engaged in the manufacturing of modular
switches, step lights and LED lights at its manufacturing facility
located at Bhimpore, Nani Daman, possessing a capacity to
manufacture approx. one crore switches per annum. The modular
switches and LED lights find a wide range of applications in the
residential & commercial real estate sector, whereas the step
lights find application in the theaters and auditoriums. Further
the company procures its raw materials viz. electronic components,
solid brass components, hardware, polymer & plastic granules, etc.,
from the local players mainly based out of Mumbai.
LAXMINARAYAN SHIVHARE: CARE Keeps D Ratings in Not Cooperating
--------------------------------------------------------------
CARE Ratings said the rating for the bank facilities of
Laxminarayan Shivhare (LS) continues to remain in the 'Issuer Not
Cooperating' category.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long Term Bank 7.00 CARE D; ISSUER NOT COOPERATING;
Facilities Rating continues to remain
Under Issuer Not Cooperating
Category
Long Term/ 3.00 CARE D/CARE D; ISSUER NOT
Short Term COOPERATING; Rating continues
Bank Facilities to remain under ISSUER NOT
COOPERATING category
Detailed Rationale & Key Rating Drivers
CARE had, vide its press release dated December 31, 2019, placed
the rating of LS under the 'Issuer non-cooperating' category as LS
had failed to provide information for monitoring of the ratings as
agreed to in its rating agreement. LS continues to be
non-cooperative despite repeated requests for submission of
information through e-mails, phone calls and a letter dated
June 24, 2020, June 25, 2020, June 26, 2020, August 4, 2020,
October 5, 2020, October 13, 2020. In line with the extant SEBI
guidelines, CARE has reviewed the rating on the basis of the best
available information which however, in CARE's opinion is not
sufficient to arrive at a fair rating.
Users of this rating (including investors, lenders and the public
at large) are hence requested to exercise caution while using the
above ratings.
Detailed description of the key rating drivers
At the time of last rating on December 31, 2019, following was the
key rating weakness:
Rating Weakness
* Delay in the debt servicing: There was delay in debt servicing in
past owing to stressed liquidity position.
Established in 1990, M/s Laxminarayan Shivhare (LNSH) is a
proprietorship firm which is into the business of retailing of
alcohol. The firm also operates a warehouse named M/s Maa Kaila
Devi Warehouse. LNSH is part of Shivhare liquor group based in
Madhya Pradesh (MP). LNSH holds retail liquor supplier license in
MP and undertakes retail trade of Indian made foreign liquor
(IMFL), beer, country liquor (CL), wine etc. The firm enters into
open tendering process every year to avail license for the
retailing of the liquor. Depending upon the allotment of shops
during tendering, the number of shops held by the firm varies every
year. The shops are allotted in MP by the state government through
a competitive bidding process. Shivhare Liquor group has other
associate concern namely M/s Ram Swaroop Shivhare, M/s Gopal
Shivhare, M/s Laxmi Narayan Shivhare & M/s Kalpna Shivhare which
are engaged in similar business activity.
LONDON STAR: CARE Keeps D Debt Ratings in Not Cooperating
---------------------------------------------------------
CARE Ratings said the rating for the bank facilities of London Star
Diamond Company (India) Private Limited (LSDCPL) continues to
remain in the 'Issuer Not Cooperating' category.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long Term/ 10.80 CARE D/CARE D; ISSUER NOT
Short Term COOPERATING; Rating continues
Bank Facilities to remain under ISSUER
NOT COOPERATING category
Short Term 12.85 CARE D; ISSUER NOT COOPERATING
Bank Facilities Rating continues to remain
under ISSUER NOT COOPERATING
category
Detailed Rationale & Key Rating Drivers
CARE had, vide its press release dated September 16, 2019, placed
the rating(s) of LSDCPL under the 'issuer not-cooperating' category
as LSDCPL 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. LSDCPL continue to
be non-cooperative despite repeated requests for submission of
information through e-mails, phone calls and a letter/email dated
October 12, 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 takes into account the delays in the debt servicing.
Detailed description of the key rating drivers
At the time of last rating on September 16, 2019 the following were
the rating strengths and weaknesses (Updated from the information
received from Registrar of Company):
Key Rating Weaknesses
* Delay in debt servicing: As per the interaction with the banker,
the account has turned NPA.
Incorporated in 1964, London Star Diamond Company (India) Private
Limited (LSDCPL) is engaged in trading of cut and polished
diamonds. It also does trading of rough diamonds. The company is
not a DTC sight-holder and it procures the diamonds primarily from
the domestic market and also imports from Belgium. The major
customers of LSDCPL for its cut and polished diamonds comprise of
wholesalers who in turn sell the polished diamonds to jewellery
manufacturers. LSDCPL is predominantly an export oriented firm with
around 90% of its overall revenues earned from exports (mainly in
Japan, Hongkong and Belgium) and remaining from domestic market.
The company has an associate company i.e. Milroc Development
Company LLP engaged in construction and real estate development.
MAA KALI ALLOYS: ICRA Keeps B+ Debt Ratings in Not Cooperating
--------------------------------------------------------------
ICRA said ratings for the INR45.00 crore bank facilities of Maa
Kali Alloys Udyog Private Limited continue to remain in the 'Issuer
Not Cooperating' category. The ratings are denoted as "[ICRA]B+
(Stable)/[ICRA]A4 ISSUER NOT COOPERATING".
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long Term- 23.00 [ICRA]B+ (Stable) ISSUER NOT
Fund Based COOPERATING; Rating continues
Cash Credit to remain under 'Issuer Not
Cooperating' category
Long Term- 21.50 [ICRA]B+ (Stable) ISSUER NOT
Fund Based COOPERATING; Rating continues
Term Loan to remain under 'Issuer Not
Cooperating' category
Short Term- 0.50 [ICRA]A4 ISSUER NOT
Non Fund COOPERATING; Rating continues
Based to remain under 'Issuer Not
Cooperating' category
ICRA has been trying to seek information from the entity so as to
monitor its performance, but despite repeated requests by ICRA, the
entity's management has remained non-cooperative. The current
rating action has been taken by ICRA basis best
available/dated/limited information on the issuers' performance.
Accordingly, the lenders, investors and other market participants
are advised to exercise appropriate caution while using this rating
as the rating may not adequately reflect the credit risk profile of
the entity. The rating action has been taken in accordance with
ICRA's policy in respect of non-cooperation by a rated entity
available at www.icra.in.
Incorporated in 2002, Maa Kali Alloys Udyog Private Limited
(MKAUPL) manufactures sponge iron and MS billets with an annual
installed capacity of 60,000 MT and 56,000 MT, respectively. The
manufacturing facility, located in Raigarh, Chhattisgarh, also
consists of a captive power plant of 8 MW. The sponge iron plant
was started in 2005, whereas the billet and power units were
started in December, 2013.
MJM INDUSTRIES: Ind-Ra Keeps 'B' Issuer Rating in Non-Cooperating
-----------------------------------------------------------------
India Ratings and Research (Ind-Ra) has maintained MJM Industries
Private Limited's Long-Term Issuer Rating in the non-cooperating
category. The issuer did not participate in the rating exercise
despite continuous requests and follow-ups by the agency.
Therefore, investors and other users are advised to take
appropriate caution while using these ratings. The rating will
continue to appear as 'IND B (ISSUER NOT COOPERATING)' on the
agency's website.
The instrument-wise rating actions are:
-- INR200 mil. Proposed term loan* assigned and maintained in
non-cooperating category with IND B (ISSUER NOT COOPERATING)
rating.
*The provisional rating of the proposed bank facilities has been
converted to final rating as per Ind-Ra's updated policy.
Note: ISSUER NOT COOPERATING: The ratings were last reviewed on
November 21, 2017. Ind-Ra is unable to provide an update, as the
agency does not have adequate information to review the ratings.
COMPANY PROFILE
Incorporated in March 2013, MJM Industries manufactures liquefied
petroleum gas-operated iron boxes.
PATWARI STEELS: ICRA Keeps D on INR13.7cr Loans in Not Cooperating
------------------------------------------------------------------
ICRA said rating for the INR13.70 crore bank facilities of Patwari
Steels Private Limited has continued to 'Issuer Not Cooperating'
category. The rating is now denoted as "[ICRA]D/[ICRA]D ISSUER NOT
COOPERATING".
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long Term-Fund 11.00 [ICRA]D ISSUER NOT COOPERATING;
Based/CC Rating continues to remain in
the 'Issuer Not Cooperating'
category
Long Term-Fund 0.81 [ICRA]D ISSUER NOT COOPERATING;
Based/TL Rating continues to remain in
the 'Issuer Not Cooperating'
category
Short Term- 0.72 [ICRA]D ISSUER NOT COOPERATING;
Fund Based Rating continues to remain in
the 'Issuer Not Cooperating'
category
Long Term/ 1.17 [ICRA]D ISSUER NOT COOPERATING;
Short Term- Rating continues to remain in
Unallocated the 'Issuer Not Cooperating'
category
ICRA has been trying to seek information from the entity so as to
monitor its performance, but despite repeated requests by ICRA, the
entity's management has remained non-cooperative. The current
rating action has been taken by ICRA basis best
available/dated/limited information on the issuers' performance.
Accordingly, the lenders, investors and other market participants
are advised to exercise appropriate caution while using this rating
as the rating may not adequately reflect the credit risk profile of
the entity. The rating action has been taken in accordance with
ICRA's policy in respect of non-cooperation by a rated entity
available at www.icra.in.
Incorporated in 1981, PSPL manufactures MS ingots and TMT bars with
annual installed capacity of 16,000 metric tones and 33,000 metric
tonnes, respectively. The manufacturing units are in Patna, Bihar.
PAWAN AUTOWHEELS: CARE Lowers Rating on INR11.15cr LT Loan to B-
----------------------------------------------------------------
CARE Ratings revised the ratings on certain bank facilities of
Pawan Autowheels Private Limited (PAPL), as:
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long Term 11.15 CARE B-; ISSUER NOT COOPERATING
Bank Facilities Rating continues to remain
under ISSUER NOT COOPERATING
category and Revised from
CARE B
Detailed Rationale & Key Rating Drivers
CARE had, vide its press release dated September 27, 2019, placed
the ratings of PAPL under the 'issuer non-cooperating' category as
PAPL had failed to provide information for monitoring of the
rating. PAPL continues to be non-cooperative despite repeated
requests for submission of information through e-mails, phone calls
and an email dated October 15, 2020, October 07, 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 is revised taking into account non-availability of
requisite information and no due-diligence conducted due to
non-cooperation by Pawan Autowheels 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. Further banker could not be contacted. The ratings
assigned to the bank facilities of PAPL is constrained owing to
Small scale of operations, Low profitability margins, leveraged
capital structure, weak coverage indicators and elongated inventory
holding. The rating is further constrained by Weak liquidity
position and intense competition, geographical concentration and
fortunes linkage to performance of Hyundai Motors India Ltd. The
ratings however derived strength from experienced promoters.
Detailed description of the key rating drivers
At the time of last rating on September 27, 2019, the following
were the rating strengths and weaknesses:
Key Rating Weaknesses
* Small scale of operations: The total operating income of the
company continues to remain small marked by total operating income
of INR59.53 crore in FY19 as against INR50.67 crore in FY18 which
inherently limits the company's financial flexibility in times of
stress and deprives it of scale benefits.
* Low profitability margins, leveraged capital structure, weak
coverage indicators and elongated inventory holding: An automotive
dealer's revenues are driven by volumes while the profits are
driven by sale of spares and service income as the latter fetch
higher profit margins. The company has limited negotiating power
with manufacturers and has no control over the selling price of the
vehicles as the same is fixed by the manufacturers. This resulted
in low profitability margins for the company during the last three
financial years i.e. FY17-FY19 as marked by PBILDT and PAT margins
of 3.57% and 0.85% respectively in FY19(refers to the period April
1 to March 31). The capital structure of the company stood
leveraged as on past three balance sheet date ending March 31,
'17-'19 on account of high dependence on external borrowings as
marked by overall gearing of 2.68x in FY19 to meet the working
capital requirements with low net worth base. Furthermore, due to
low profitability margin and high interest cost the coverage
indicators remained weak. PAPL maintains an average inventory of
around 2-3 months to meet unexpected demand of customers and guard
against supply shortage.
* Weak liquidity position: The liquidity position of the company
stood weak as marked by current and quick ratio of 1.40 times and
0.74 times respectively as on March 31, 2019. Further, the cash and
bank balance stood at INR0.88 crore as on March 31, 2019.
* Intense competition, geographical concentration and fortunes
linkage to performance of Hyundai Motors India Ltd: The fortunes
of PAPL are closely linked to those of Hyundai Motors India Ltd
(HMIL), being the only supplier for the company. The sales and
distribution of automobiles, especially passenger vehicle segment
is marked by intense competition attributable to presence of
several dealers in the nearby areas. The already existing
competition is further worsened by the major automobile
manufacturers extending similar discounts and promotional schemes
to lure customers for purchases. In light of the same, the margins
are likely to remain severely constrained for the dealers and
distributors. Furthermore, the revenues of PAPL would also be
governed by launch of newer models by Hyundai, and acceptance of
the products in the market. Moreover, the sales of PAPL are
generated from just one showroom at Ghaziabad and it faces stiff
competition from other automobile dealers such as Maruti, TATA,
etc, in the vicinity (Delhi, Gurgaon, and Noida).
Key Rating Strengths
* Experienced promoters: The company is being managed by Mr. Ashok
Kumar Garg and Mr. Shobhit Garg. Mr. Ashok Kumar Garg has more than
three decades experience in a similar line of business. Prior to
establishment of PAPL he was managing the business of "Shiva
Motors" (Inactive) engaged in auto dealership business. Also, he
looks after day to day operation of group associate "Suman Autos".
He is duly supported by his son; Mr. Shobhit Garg who has a decade
of experience in auto dealership business through his association
with PAPL.
Ghaziabad-based (Uttar Pradesh), PAPL incorporated in March 2009 by
Mr. Ashok Kumar Garg and Mr. Shobhit Garg and commenced its
commercial operations from April 2011. PAPL has an authorized
dealership of Hyundai Motors India Ltd (HMIL). It is operating as
3S facility 'Sales, spares and service'. Suman Autos is an
associate concern of PAPL; it is an authorized dealer of Bajaj Auto
Limited.
POLIXEL SECURITY: Ind-Ra Affirms 'BB' LongTerm Issuer Rating
------------------------------------------------------------
India Ratings and Research (Ind-Ra) has affirmed Polixel Security
Systems Private Limited's (PSSPL) Long-Term Issuer Rating at 'IND
BB'. The Outlook is Stable.
The instrument-wise rating actions are:
-- INR25 mil. Fund-based working capital limit affirmed with IND
BB/Stable/IND A4+ rating; and
-- INR60 mil. (reduced from INR100 mil.) Non-fund-based working
capital limit affirmed with IND A4+ rating.
KEY RATING DRIVERS
The affirmation reflects PSSPL's continued small scale of
operations. The company's revenue improved to INR215.67 million in
FY20 (FY19: INR178.79 million) owing to the execution of a large
and new government of India defense project.
The ratings factor in PSSPL's continued modest credit metrics,
which deteriorated in FY20 due to a significant fall in the
absolute EBITDA to INR4.52 million (FY19:INR10.65 million). The
company's net leverage (Ind-Ra adjusted debt/operating EBITDAR)
stood at 8.81x in FY20 (FY19: 4.90x) and interest coverage
(operating EBITDA/gross interest expense) at 0.60x (1.45x).
The ratings are constrained by PSSPL's modest margin. The company's
margin contracted to 2.10% in FY20 (FY19: 5.96%) due to an increase
in its operating and maintenance expenses and a write off of
INR13.44 million worth bad debts. The company's return on capital
employed stood at 2.2% in FY20 (FY19: 6.7%). The management expects
no such huge write off in FY21, and resultantly expects the margins
to improve.
Liquidity Indicator - Poor: PSSPL's average utilization of
fund-based and non-fund based limit was 97.49% and 47.56%,
respectively, for the 12 months ended October 2020. The company's
cash flow from operations turned negative to INR7.93 million in
FY20 (FY19: INR7.99 million) due to unfavorable changes in the
working capital requirement. Its cash and cash equivalents stood at
INR4.47 million at FY20 (FY19: INR1.03 million) against a total
outstanding working capital debt of INR24.29 million (INR13.23
million) and unsecured loans from promoters of INR20 million (INR20
million). The company's net working capital cycle shortened to 105
days in FY20 (FY19: 121 days) owing to an improvement in collection
days to 102 (210) and improved inventory management.
The ratings are also constrained by the company's significant
client concentration with more than 92% (65%) orders flowing in
from its parent entity.
However, the ratings are supported by PSSPL's established track
record in the security systems industry and its reputed clientele
base.
RATING SENSITIVITIES
Positive: A substantial increase in the scale of operations,
leading to a sustained improvement in the credit metrics will be
positive for the ratings.
Negative: A decline in the scale of operations, leading to the
interest coverage sustaining below 1.7x and/or further
deterioration in the liquidity on a sustained basis and/or any
weakening in linkages with parent company will be negative for the
ratings.
COMPANY PROFILE
Incorporated on February 15, 2010, PSSPL is a 100% subsidiary of
Himachal Futuristic Communications Ltd. The company is engaged in
the business of integrated security and surveillance solutions such
as CCTV, traffic management, fire alarm etc. PSSPL also provides
turnkey solutions for the electronic security, safety, and video
surveillance and safety needs of businesses across verticals.
RELIANCE INFRASTRUCTURE: Ind-Ra Affirms 'D' LongTerm Issuer Rating
------------------------------------------------------------------
India Ratings and Research (Ind-Ra) has affirmed Reliance
Infrastructure Limited's (R-Infra) Long-Term Issuer Rating at 'IND
D'.
The instrument-wise rating actions are:
-- INR35 mil. (reduced from INR50.1 mil.) Bank facilities (long-
term/short-term) affirmed with IND D rating; and
-- INR3.85 mil. Non-convertible debenture (NCDs, long-term)
INE036A07567 issued June 13, 2018 coupon rate 12.5% due on
December 15, 2021 affirmed with IND D rating.
KEY RATING DRIVERS
The ratings reflect R-Infra's ongoing delays in servicing the rated
debt instruments, according to the company's disclosure on the
National Stock Exchange Ltd and the BSE Ltd.
COMPANY PROFILE
R-Infra is the flagship company of the India-based Reliance Group,
led by Anil Dhirubhai Ambani, with focus on the energy and
infrastructure businesses. R-Infra has an in-house engineering,
procurement and construction division that is active in the power
and road segments.
SOUTHERN AGENCIES: ICRA Reaffirms B Rating on INR10cr LT Loan
-------------------------------------------------------------
ICRA has reaffirmed ratings on certain bank facilities of Southern
Agencies (SA), as:
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long-term Fund-
based/CC 10.00 [ICRA]B(Stable); reaffirmed
Rationale
The rating reaffirmation is constrained by the small scale of
operations of SA with revenues of INR35.6 crore in FY2020 and weak
financial risk profile, high gearing and modest debt coverage
indicators. Further, the rating notes the high working capital
intensity of operations due to high inventory holding. The rating
considers SA's thin profitability margins owing to the trading
nature of business, the inherent risk associated with a partnership
firm including the risk of capital withdrawal by partners.
Moreover, it remains exposed to high geographical concentration
risk with presence limited to Andhra Pradesh and Telangana. ICRA
notes the intense competition in the highly fragmented distribution
industry with many established organised players on account of the
low complexity of work involved.
The rating, however, draws comfort from the fact that SA is the
authorised dealer for Godrej Industries' products in Andhra Pradesh
and Telangana with 20 branches, and the extensive experience of
partners in the wholesale distribution business. Further, the
established position of Godrej Industries in the home appliance,
security and furniture segment provides additional comfort.
Moreover, the firm is the authorised dealer for IFB Industries
Limited, Usha International Limited and MM Rubber Company Limited
(MM Foam).
The Stable outlook reflects ICRA's expectation that SA would
continue to benefit from its established presence in the dealership
business. The firm's ability to improve its scale of operation and
profitability levels, while managing its working capital
requirements would remain the key rating driver.
Key rating drivers and their description
Credit strengths
* Extensive experience of promoters in distribution business: The
promoters have more than six decades of experience in the
dealership business for products such as refrigerators, washing
machines, air conditioners, furniture, etc. SA's sales are made to
retailers, institutions and distributors. Established relationships
with customers have resulted in repeat
orders.
* Authorised wholesale dealer for Godrej Industries' products: SA
is the authorised wholesale dealer for Godrej Industries, with 20
branches in Andhra Pradesh and Telangana. The firm is the
authorised dealer for IFB Industries Limited, MM Foam, Usha
International Limited, LG Electronics India Private Limited and
Whirlpool India Limited.
Credit challenges
* Small scale of operations: The firm's scale of operations remains
small with revenues of INR43.98 crore in FY2019 and INR35.6 crore
in FY2020. Further, the revenues are estimated to decline by ~25%
in FY2021, due to the impact of the Covid-19 pandemic.
* Weak profitability and debt coverage indicators: The operating
profit margin of the distributors, including SA, is inherently low
due to the nature of the business, characterised by high volumes
and low margins. The scope of margin expansion remains limited, as
the margins are regulated by the principal to a large extent. The
firm's financial risk profile is characterised by a high gearing of
3.61 times, Total Debt/OPBDIT of 8.78 times and NCA/TD of 2% in
FY2019.
* Intense competition in dealership business: The distribution
industry is highly fragmented with many established organised
players given the low complexity of work involved, resulting in
intense competition.
* Risks associated with constitution as partnership firm: Given
SA's constitution as a partnership firm, it is exposed to risks
including the possibility of capital withdrawal by the partners.
Liquidity position: Stretched
SA's liquidity position remains stretched as evident from 88%
average utilisation of working capital utilisation during the last
12 months between November 2019 and October 2020. The utilisation
remained high owing to the working capitalintensive nature of the
business on account of high inventory holding inherent in the
wholesale dealership business. It does not have any external term
loans as on March 31, 2020. However, the firm was sanctioned
INR1.00-crore of term loan under Baroda Covid Emergency Credit Line
in June 2020, which supported its liquidity to an extent. It has
repayment obligations of INR0.16 crore in FY2021 towards the same.
Rating sensitivities
Positive triggers - ICRA could upgrade SA's rating if there is
substantial growth in revenues, along with an improvement in
operating margins and liquidity position. Specific credit metrics
that could lead to an upgrade of SA's rating include interest
coverage above 1.5 times on a sustained basis.
Negative triggers - Negative pressure on SA's rating could arise if
there is decline in revenues or operating margins and further
weakening of liquidity position.
Southern Agencies, established in 1950 as a partnership firm, is a
wholesale dealer for Godrej Industries' products including
refrigerators, washing machines, air conditioners, furniture etc.
The firm is a wholesale dealer for IFB Industries Limited, MM Foam,
Usha International Limited, etc. Its head office is located in
Rajahmundry, and it has presence in eight districts through 20
branches spread across Andhra Pradesh and Telangana.
SREEREDDY PROPERTIES: CARE Lowers Rating on INR5.34cr Loan to C
---------------------------------------------------------------
CARE Ratings revised the ratings on certain bank facilities of
SreeReddy Properties Private Limited (SRPPL), as:
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long Term Bank 5.34 CARE C; Stable; ISSUER NOT
Facilities COOPERATING; Rating continues
to remain under ISSUER NOT
COOPERATING category and
Revised from CARE B; Stable
Detailed Rationale & Key Rating Drivers
CARE had, vide its press release dated September 10, 2019, placed
the rating(s) of SRPPL under the 'issuer non-cooperating' category
as SRPPL had failed to provide information for monitoring of the
rating. SRPPL continues to be non-cooperative despite repeated
requests for submission of information through e-mails, phone calls
and email dated September 7, 2020 to October 30, 2020. In line with
the extant SEBI guidelines, CARE has reviewed the rating on the
basis of the public available information which however, in CARE's
opinion is not sufficient to arrive at a fair rating.
Users of this rating (including investors, lenders and the public
at large) are hence requested to exercise caution while using the
above rating.
The revision in the ratings is on account of non-availability of
requisite information due to non-cooperation by SreeReddy
Properties Private Limited (SRPPL), with CARE'S efforts to
undertake a review of the rating outstanding, as CARE views
information availability risk as key factor in its assessment of
credit risk profile.
Detailed Rationale& Key Rating Drivers
At the time of last rating September 10, 2019, the following were
the rating strengths and weaknesses:
Key Rating Weakness
* Small scale of operations: Although having accomplished various
projects and a track record of 8 years, the firm's scale of
operations marked by the total operating income remained small at
INR2.41 crore in FY17 coupled with a low net worth base of INR0.68
crore as on March 31, 2017 as compared to other peers in the
industry. The small scale of operation could restrict the firm's
financial flexibility and deprive it of scale benefits.
* Weak sales performance: Although having incurred 67% of total
cost, the company has sold 3,000 square feet (18.58%) out of the
total saleable area of 16,144 square feet till August 31, 2017 for
a value of INR1.56 crore. The firm received customer advances to a
tune of at 29% of sales. The overall booking of flats stood at 17%
of total flats as on July 31, 2017. The collection is made on the
following basis: 20% of at the time of agreement, 10% after the
completion of foundation, 40% divided equally at time of laying
1stto 4thslab, 10% at the time of wall construction, 15% at the
time of registration and 5% at the time of possession.
* Leveraged capital structure: The capital structure of the company
has deteriorated and marked by overall gearing ratio of 4.90x as on
March 31, 2017 as compared to 3.07x as on March 31, 2016.
* Geographically concentrated revenue profile: SRPPL entirely
derives its revenue from orders executed in the state of Karnataka,
particularly from Bengaluru city, which exposes the company to
geographical concentration risk.
* Fragmented nature of the real estate sector albeit improving
growth prospects: The real estate sector in India is highly
fragmented with a large number of small and mid-sized players.
Certain factors such as project execution challenges, delays in
land acquisition, regulatory clearances, long working capital
cycles as a result of longer gestation periods collectively place
pressure on the company's credit profile. Despite these
impediments, increasing growth in residential properties due to
lower interest rates, easy availability of housing finance and
various government initiatives in real estate sector are expected
to revive the industry in medium to long term.
Key Rating Strengths
* Experience of the promoter in real estate business: SRPPL is
promoted by Mr. Sirish Kumar Reddy (Managing Director) and Mrs.
Jamuna Sirish Reddy. Mr. Sirish has more than a decade of
experience in the construction line of business. His decade long
presence in the market has helped him in establishing good
relationships with customers.
* Financial closure for the project achieved: The "SreeReddy
Ceyone" project is proposed to be funded by promoter's capital
(22%), sanctioned term loan (60%) and advances from customers and
sales (18%). As on August 31st2017, the firm has incurred a total
cost of 67%.
Bangalore (Karnataka) based, SreeReddy Properties Private Limited
(SRPPL) was incorporated in the year 2009. Its promoters are Mr.
Sirish Kumar Reddy (Managing Director) and Mrs. Jamuna Sirish
Reddy. The company is engaged in the construction and development
of residential townships, apartments, shopping malls and commercial
complexes.
SWATHI SUNSOURCE: CARE Lowers Rating on INR14cr Loan to C
---------------------------------------------------------
CARE Ratings revised the ratings on certain bank facilities of
Swathi Sunsource Power Private Limited (SSPPL), as:
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long Term Bank 14.00 CARE C; Stable; ISSUER NOT
Facilities COOPERATING; Rating continues
to remain under ISSUER NOT
COOPERATING category and
Revised from CARE B; Stable
Long Term/ 6.00 CARE C/CARE A4; ISSUER NOT
Short Term COOPERATING; Rating continues
Bank Facilities to remain under ISSUER NOT
COOPERATING category and
Revised from CARE B/CARE A4
Detailed Rationale & Key Rating Drivers
CARE had, vide its press release dated September 10, 2019, placed
the rating(s) of SSPPL under the 'issuer non-cooperating' category
as SSPPL had failed to provide information for monitoring of the
rating. SSPPL continues to be non-cooperative despite repeated
requests for submission of information through e-mails, phone calls
and email dated September 07, 2020 to October 30, 2020. In line
with the extant SEBI guidelines, CARE has reviewed the rating on
the basis of the public available information which however, in
CARE's opinion is not sufficient to arrive at a fair rating.
Users of this rating (including investors, lenders and the public
at large) are hence requested to exercise caution while using the
above rating.
The revision in the ratings is on account of non-availability of
requisite information due to non-cooperation by Swathi Sunsource
Power Private Limited (SSPPL), with CARE'S efforts to undertake a
review of the rating outstanding, as CARE views information
availability risk as key factor in its assessment of credit risk
profile.
Detailed Rationale& Key Rating Drivers
At the time of last rating September 10, 2019, the following were
the rating strengths and weaknesses:
Key Rating Weakness
* Small scale of operations with operating and cash losses: SSPPL
has started its commercial operations in FY17 due to nascent stage
of operations, the company registered the small scale of operations
marked by total operating income of INR1.90 crore in FY18 as
compared to INR0.28 crore in FY17. Further, the company registered
the net and cash losses during FY18.
* Leveraged capital structure and weak debt coverage indicators:
Though promoters infused capital in the form securities premium,
the capital structure of the company marked by overall gearing
ratio stood leverage at 2.94x as on March 31, 2018. Further, the
debt coverage indicators marked by interest coverage ratio stood
low at 0.12x in FY18.
* Elongated working capital cycle: The operating cycle of the
company stood at 445 days in FY18 due to high inventory holding
period of 357 days and elongated trade receivable to the extent of
126 days in FY18.
* Susceptibility to fluctuation in raw material prices and presence
in competitive industry: The major raw materials of the company
include aluminum and sheet receiver tubes prices of which are
volatile in nature which may affect the profitability margins of
the company. The entity operates in a highly competitive industry
with limited entry barriers and thereby faces competition from many
organised and unorganised players, which has led to increased
competition. Furthermore, with increasing growth opportunities for
solar energy sector due to government support/incentives, more
players are entering the industry thereby increasing competition.
Key Rating Strengths
* Experienced promoters: At present the management of the company
is vested in the hands of Mr. Premraj Pamate Chalavaraj (M.D), Mr.
Ashish Bipinkumar Soni and Mr. Ravi Banarasilal Kapoor. Mr. Premraj
Pamate Chalavaraj, mechanical engineer having around three decades
of experience in solar industry and have worked with several solar
companies and holds few patents on his name of solar products.
Furthermore, he is supported by other two directors namely Mr.
Ashish Bipinkumar Soni and Mr. Ravi Banarasilal Kapoor who also
look after day-to-day operations of the company.
* Locational advantage: The company is setting up manufacturing
unit at Penukonda, Anantapur District, Andhra Pradesh which is
located in industrial park in Andhra Pradesh thus paving easy
access to skilled and unskilled workers, transport and
communication facilities.
* Favorable industry scenario and government support: Furthermore,
the company is expected to benefit as potential for growth of solar
projects in Andhra Pradesh are high with state government
initiatives and the state experiences sunshine days through most
part of the year.
Incorporated in 2010 by Mr. Premraj Pamate Chalavaraj, Mr. Ashish
Bipinkumar Soni and Mr. Ravi Banarasilal Kapoor. Swathi Sunsoure
Power Private Limited (SSPPL) is currently setting up unit to
manufacture solar collectors/equipment's i.e. Parabolic Troughs,
which can be used by clientele to generate heat/steam/power at its
manufacturing facility located at Industrial Part Penukonda,
Anantapur District, Andhra Pradesh. Furthermore, the company also
has in-house research and development facility at Penukonda, which
is partially functional.
SWAYAMPRABHA UDAYAM: ICRA Reaffirms B+ Rating on INR4.25cr Loan
---------------------------------------------------------------
ICRA has reaffirmed ratings on certain bank facilities of
Swayamprabha Udayam & Company (Swayamprabha), as:
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long-term- 4.25 [ICRA]B+(Stable); reaffirmed
Fund-based–
Cash Credit
Short-term- 9.25 [ICRA]A4; reaffirmed
Fund-based
Rationale
The reaffirmation of the ratings of Swayamprabha continues to
derive comfort from the extensive experience of the partners in the
cashew processing industry and their established distribution
channel across domestic and export markets. The ratings also factor
in the firm's established relationship with its key customers and
suppliers for the procurement of raw cashew nuts (RCNs). ICRA also
notes the favorable long term domestic prospects for cashew
products.
However, the ratings are constrained by Swayamprabha's modest scale
of operations, which limits its operational and financial
flexibility. Weak demand and realisations in FY2020 and the current
financial year, which was impacted by Covid outbreak, resulted in
significant decline in the firm's revenues and profitability. This
alongwith inventory buildup in this period led to moderation of
credit metrics which continued to be modest. The ratings remain
constrained by the intense competition from other players as well
as the vulnerability of the firm's performance to volatility in
prices of cashew kernels and RCNs and movement in foreign exchange
rates. The ratings factor in the risks inherent in partnership
firms including the capital withdrawal risk, among others. The
Stable outlook on the [ICRA]B+ rating reflects ICRA's expectation
that Swayamprabha will benefit from the healthy domestic demand
prospects of the sector.
Key rating drivers and their description
Credit strengths
* Extensive experience of the promoters in cashew processing
industry: The firm was established in 2000 to process and convert
RCN to cashew kernels and the promoters have experience of about
two decades in the industry. The partners have established strong
relationship with its customers and a major portion of its revenues
are driven through repeat orders from these customers.
* Established relationship with suppliers: Due to its extensive
presence and established track record, the firm has built strong
relationship with suppliers, both in the international and domestic
markets. This ensures timely receipt of RCNs at favourable costs.
* Favourable long term domestic demand prospects: The consumption
of cashew is on the rise in the country, particularly as an
ingredient in various food products, which supports the long-term
demand prospects for cashew, notwithstanding the recent demand
weakness. In the domestic market, cashew kernels have been fetching
higher prices than in the international markets.
Credit challenges
* Modest scale of operations with decline in revenues: The firm has
small scale of operations in the highly fragmented cashew industry,
which restricts the benefits arising from economies of scale. The
operating income declined to INR27.0 crore in FY2020 from INR48.7
crore in FY2019 on account of low realisations and lower than
expected demand in the domestic market. The firm has generated only
~INR7.2 crore in 6MFY2021 on account of covid outbreak. However,
sales are expected to pick up in H2FY2021 due to festive season
which should limit the revenue decline in the full year.
* Financial profile characterised by thin margins and modest
coverage indicators: The firm's profits declined in FY2020 due to
lower realisations for cashew kernels in the domestic market.
Further build-up of finished goods inventory in March 2020 and
consequent higher utilisation of its working capital borrowings,
kept the coverage indicators at modest
levels.
* Margins exposed to volatility in cashew prices and foreign
exchange fluctuations: The procurement of RCNs is seasonal and not
backed by confirmed orders. The prices of cashew kernels and RCNs
vary on a daily basis, depending on the international demand-supply
scenario, which exposes the firm's margins to price and forex
fluctuations. Moreover, the availability of RCNs is subject to
agro-climatic risks.
* Intense competition and lack of product differentiation limit
pricing flexibility: The domestic cashew industry is highly
competitive with the presence of a large number of small-scale
units. In the export market, it faces competition from other cashew
processing countries like Vietnam and Brazil. The stiff competition
and the commoditised nature of the product restrict its pricing
flexibility.
* Inherent risk associated with a partnership firm: Swayamprabha is
exposed to risks associated with a partnership firm, including the
capital withdrawal risk, which can adversely impact its capital
structure.
Liquidity: Stretched
The firm has modest repayments over the next few quarters. The cash
credit limit of the firm was highly utilised as of September 30,
2020. Further, there are no major cash balances. However, for the
pledge loan against raw material and finished goods inventory to
the tune of INR9.25 crore, the firm usually has a buffer of at
least INR1.5-2.0 crore of undrawn limits for the same facility.
Overall, given the limited cashflow generation and modest sales
performance with backdrop of long working capital cycle, the firm's
liquidity position remains stretched.
Rating Sensitivities
Positive Triggers - The ratings may be upgraded if there is pickup
in demand in consumption of cashew nuts leading to improvement in
revenues and profitability. The ratings could also be upgraded if
there is effective management of the working capital facilities
leading to improvement in liquidity position.
Negative Triggers - The ratings may be downgraded if there is
decline in revenues and profitability or if there is any stretch in
the working capital cycle leading to weakening of the liquidity
position or if there is any increase in debt levels resulting to
deterioration in debt coverage metrics.
Established in 2000, Swayamprabha is a partnership firm managed by
Mr. Ajith Kamath and his wife Mrs. Anasooya Kamath. It processes
RCNs and converts them into kernels. It imports RCNs primarily from
the African countries like Guinea Bissau, Tanzania and Ivory Coast.
The processed kernels are graded, packed and sold in the domestic
and international market. The firm's manufacturing facility is
located in Karkala.
As per provisional results for FY2020, the firm reported a net
profit of INR0.1 crore on an operating income (OI) of INR27.0
crore, as against a net loss of INR0.3 crore on an OI of INR48.7
crore in FY2019.
SYNCO INDUSTRIES: ICRA Keeps C+ Rating in Not Cooperating
---------------------------------------------------------
ICRA said the ratings for the INR10.00 crore bank facilities of
Synco Industries Limited continue to remain in the 'Issuer Not
Cooperating' category. The ratings are denoted as "[ICRA]C+/A4
ISSUER NOT COOPERATING".
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Fund-based 8.50 [ICRA]C+ ISSUER NOT COOPERATING;
Cash Credit Rating continues to remain under
'Issuer Not Cooperating'
Category
Non-fund 1.50 [ICRA]A4 ISSUER NOT COOPERATING;
based Bank Rating continues to remain under
Guarantee 'Issuer Not Cooperating'
Category
ICRA has been trying to seek information from the entity so as to
monitor its performance, but despite repeated requests by ICRA, the
entity's management has remained non-cooperative. The current
rating action has been taken by ICRA basis best
available/dated/limited information on the issuers' performance.
Accordingly, the lenders, investors and other market participants
are advised to exercise appropriate caution while using this rating
as the rating may not adequately reflect the credit risk profile of
the entity. The rating action has been taken in accordance with
ICRA's policy in respect of non-cooperation by a rated entity
available at www.icra.in.
Incorporated in 1982, SIL was originally incorporated as private
limited company - 'Synco Textiles Private Limited' for carrying out
dyes and chemical manufacturing activity. However, with
discontinuation of the dyes and chemical manufacturing business and
commencement of oil extraction business in 1995, the name was
changed to Synco Industries Limited and presently the company is
involved in Processing of Mustard seed and Groundnut and selling of
oil and de-oiled cake having installed plant capacity of 75,000
Metric tonnes per annum located in Sumerpur which is approx 150 km
from Jodhpur. The company is also engaged in the manufacturing of
blasting machines used in foundries for cleaning, grading and
powder coating and pollution control equipments.
TELUGU CINE: Ind-Ra Keeps 'D' Bank Loan Rating in Non-Cooperating
-----------------------------------------------------------------
India Ratings and Research (Ind-Ra) has maintained Telugu Cine
Workers Cooperative Housing Society Limited's bank facility rating
in the non-cooperating category. The issuer did not participate in
the rating exercise despite continuous requests and follow-ups by
the agency. Therefore, investors and other users are advised to
take appropriate caution while using these ratings. The rating will
continue to appear as 'IND D (ISSUER NOT COOPERATING)' on the
agency's website.
The instrument-wise rating action is:
-- INR500 mil. Fund-based working capital maintained in non-
cooperating category with IND D (ISSUER NOT COOPERATING)
rating.
Note: ISSUER NOT COOPERATING: The rating was last reviewed on
January 7, 2019. Ind-Ra is unable to provide an update, as the
agency does not have adequate information to review the rating.
COMPANY PROFILE
Telugu Cine Workers Cooperative Housing Society is registered under
the Andhra Pradesh Co-Operative Societies Act 7 of 1964. It was
established in 1991 for the construction and handover of housing
units in Chitrapuri Colony, Hyderabad.
V.A. PRODUCTS: CARE Lowers Rating on INR1.50cr LT Loan to C
-----------------------------------------------------------
CARE Ratings revised the ratings on certain bank facilities of V.A.
Products (VAP), as:
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long Term Bank 1.50 CARE C; Stable; ISSUER NOT
Facilities COOPERATING; Rating continues
to remain under ISSUER NOT
COOPERATING category and
Revised from CARE B-; Stable
Short Term Bank 4.50 CARE A4; ISSUER NOT
Facilities COOPERATING; Rating continues
to remain under ISSUER NOT
COOPERATING category
Detailed Rationale & Key Rating Drivers
CARE had vide its press release dated September 3, 2019, placed the
rating(s) of V.A. Products under the 'issuer noncooperating'
category as VAP had failed to provide information for monitoring of
the rating. VAP continues to be noncooperative despite repeated
requests for submission of information through e-mails, phone calls
and email dated October 30, 2020 to November 9, 2020. In line with
the extant SEBI guidelines, CARE has reviewed the rating on the
basis of the public available information which however, in CARE's
opinion is not sufficient to arrive at a fair rating.
Users of this rating (including investors, lenders and the public
at large) are hence requested to exercise caution while using the
above rating.
The revision in the ratings is on account of non- availability of
requisite information for monitoring the ratings.
Detailed description of the key rating drivers
At the time of last rating on September 3, 2019, the following were
the rating strengths and weaknesses
Key Rating Weaknesses
* Small scale of operations albeit growth in total operating income
during FY15: VAP's scale of operations has remained small with a
modest income and very low networth base. The firm's operating
income grew by 38.73% in FY15 to INR5.01 crore from INR3.61 crore
in FY14 mainly on account of favorable demand and addition of new
customers.
* Weak capital structure with low capital base: The firm has
considerable working capital requirements with high level of
debtors which is predominantly debt funded. This, along
with low net worth base, resulted in high overall gearing of 6.28x
as on March 31, 2015.
* Stretched operating cycle: VAP's operating cycle remains
significantly stretched at about 200 days mainly on account of
elongated collection period of 250-300 days as the firm has to
extend long credit periods to the OEMs due to steep competition and
low bargaining power. The firm procures about 70% of its raw
material from the local market and avails credit period of about 90
days from the local suppliers. However, the firm receives no credit
from overseas suppliers.
* Foreign currency risk: The firm being an EOU generates about 98%
of its revenue from export markets and imports about 30% of its
procurements. Thus, VAP is exposed to foreign currency risk with no
hedging measures being taken by the firm.
Key Rating Strengths
* Experienced partners: VAP is promoted by two partners Mr. J
Nandish (Managing Partner) and Mr. Babu Jayaram. Both the partners
have more than two decades of experience in the engineering
industry. Over the past decade, the firm has developed healthy
relations with its clients.
* Healthy operating profit margins, albeit thin PAT margins: The
key raw materials used by VAP are mild steel, stainless steel,
brass, copper, and aluminum which constitute around 60% of the
total cost of sales during the last three years. The prices of
these raw materials are governed by global demand-supply dynamics
and are highly volatile in nature resulting in volatile
profitability. Notwithstanding the volatility, the firm's operating
margins have been healthy with PBILDT margin of about 15% - 20%.
Despite healthy PBILDT margin, the firm's PAT margins are very thin
owing to significantly high interest cost with high level of
borrowings.
Incorporated in the year 1994, VAP is a 100% export oriented unit
(EOU) engaged in manufacturing of precision machined components.
The firm's existing range of products includes hollow screws,
spacer rings, round nuts, bushes, bolts, alternator and starter
motor, sockets, sleeves, housings, pins and bushes. The firm's
customers mainly belong to automobile engineering, aerospace, and
other allied engineering industries. VAP has its warehouses in the
U.S.A. and the U.K.; and caters to numerous international as well
as domestic clients spread across America & Europe.
VAMSI CHEMICALS: Ind-Ra Affirms 'B+' LongTerm Issuer Rating
-----------------------------------------------------------
India Ratings and Research (Ind-Ra) has taken the following rating
actions on Vamsi Chemicals (Vamsi):
-- Long-Term Issuer Rating affirmed with IND B+/Stable rating;
-- INR27.1 mil. Proposed term loan* assigned with IND B+/Stable
rating; and
-- INR2.9 mil. Term loans due on April 2023 affirmed with IND B+
/Stable rating.
*to be allocated
RATING SENSITIVITIES
Negative: A decline in the revenue and operating profitability,
resulting in a deterioration in the credit metrics, all on a
sustained basis, will be negative for the ratings.
Positive: A significant increase in the revenue and profitability,
leading to an improvement in credit metrics, all on a sustained
basis, will be positive for the ratings.
COMPANY PROFILE
Established in 2015 by Vishal Basetti, Vamsi trades chemical powder
and water-soluble fertilizers. The firm is based in Hyderabad.
VELANI OILS: CARE Keeps D on INR9cr Loans in Not Cooperating
------------------------------------------------------------
CARE Ratings said the rating for the bank facilities of Velani Oils
Private Limited (VOPL) 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
Long Term Bank 4.00 CARE D; ISSUER NOT COOPERATING
Facilities Based on best available
information
Detailed Rationale & Key Rating Drivers
CARE had, vide its press release dated November 7, 2019, placed the
ratings of VOPL under the 'Issuer non-cooperating' category as VOPL
had failed to provide information for monitoring of the rating.
VOPL continues to be non-cooperative despite repeated requests for
submission of information through e-mails, phone calls and a letter
dated October 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).
The irregularities in the account have continued and the company
has been classified as a Non-Performing Asset (NPA) by the
lenders.
Velani Oils Private Ltd (VOPL) was incorporated on June 9, 2010 by
its present promoter director Mr. Mansukh Lal Patel and his son Mr.
Tushar Patel. The company is engaged in the business of trading
edible and non-edible oils for supplying it to large edible/
non-edible oil refining companies in India. VOPL was operating as
partnership firm (Velani Oil Traders) since 1966, with the present
directors as its partners and the constitution was changed from
partnership firm to a private limited company w.e.f. June 9, 2010
while the name was changed from Velani Oil Traders (VOT) to Velani
Oils Pvt. Ltd. (VOPL). The company sources oil domestically as well
as imports from Indonesia, Malaysia and South America and supplies
to various FMCG & other companies in India. The company started its
imports from 2007. VOPL operates from its Head office (HO) in Delhi
and branch offices in Gujarat in Gandhidham and Kandla.
VISHAL CONDUIT: CARE Lowers Ratings on INR5cr Loan to 'C/A4'
------------------------------------------------------------
CARE Ratings revised the ratings on certain bank facilities of
Vishal Conduit Products Private Limited (VCPL), as:
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long Term/ 5.00 CARE C/CARE A4; ISSUER NOT
Short Term COOPERATING; Rating continues
Bank Facilities to remain under ISSUER NOT
COOPERATING category and
Revised from CARE B-/CARE A4;
Detailed Rationale & Key Rating Drivers
CARE had, vide its press release dated September 4, 2019, placed
the rating of VCPL under the 'issuer non-cooperating' category as
Vishal Conduit Products Private Limited had failed to provide
information for monitoring of the rating. VCPL continues to be
non-cooperative despite repeated requests for submission of
information through e-mails, phone calls and a letter/email dated
October 9, 2020, October 8, 2020 and October 7, 2020. In line with
the extant SEBI guidelines, CARE has reviewed the rating on the
basis of the best available information which however, in CARE's
opinion is not sufficient to arrive at a fair rating.
Users of this rating (including investors, lenders and the public
at large) are hence requested to exercise caution while using the
above ratings.
Detailed description of the key rating drivers
The rating has been revised by taking into account the
non-availability of requisite information due to non- cooperation
by Vishal Conduit Products 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.
Key Rating Weaknesses
* Small and declining scale of operations with losses at cash
level: VCPL is a relatively small player with total operating
income (TOI) of INR5.89 crore in FY17 and negative net worth base
of INR1.97 crore as on March 31, 2017. Moreover, the company
continued to incur losses at net and cash level in FY17.
Furthermore, the company discontinued its operations in FY18.
* Leveraged capital structure and weak debt coverage indicators:
The capital structure of VCPL stood leveraged owing to erosion of
networth base, as on March 31, 2017. Additionally, the debt
coverage indicators also remained weak for FY17.
Vishal Conduit Products Pvt. Ltd. (VCPL), incorporated in 2005 by
the Singh family of Jalandhar Punjab with the objective of
manufacturing of iron & steel products. Since inception, the
company is engaged in manufacturing of mild steel (MS) ingots and
mild steel (MS) pipes. The facility of the company is located at
Jalandhar, Punjab with an annual installed capacity of 12,000 MT
per annum for (MS) ingots and 1200 MT per annum for (MS) pipes. Mr.
S Mohinder Singh (Graduate), Managing Director, looks after the day
to day operations of the entity. VCPL also undertook trading of
iron and steel products.
=========
J A P A N
=========
DENTSU GROUP: To Slash 6,000 Jobs From Overseas Operations
----------------------------------------------------------
Nikkei Asian Review report that Dentsu Group plans to cut 6,000
employees from its international operations in response to
shrinking revenue from cash-strapped corporate clients worldwide.
The Nikkei relates that the job cuts announced on Dec. 7 will take
place through the end of next year at Dentsu International, the
subsidiary overseeing offshore businesses. The reductions represent
12.5% of the unit's workforce.
According to the Nikkei, Dentsu also intends to consolidate
international businesses to cut costs, integrating 160 brands into
six global brands in two years. The agency said it will announce
specific subsidiaries to be eliminated by the integration at a
later date.
The annual cost savings from the restructuring are expected to
exceed $530 million from the end of 2021, the report notes.
Dentsu, which had not released guidance previously, forecasts a
consolidated net loss of JPY23.7 billion ($227 million) for 2020,
the Nikkei discloses. The reforms at overseas operations, including
job cuts, are projected to cost roughly $820 million through 2021.
The Nikkei says revenue is forecast to decline 11% to JPY928.7
billion. The coronavirus pandemic has caused companies to cut
advertising in magazines and newspapers, which is Dentsu's bread
and butter. It projects an operating loss of JPY11.4 billion,
compared with a JPY3.3 billion loss last year, the Nikkei adds.
Dentsu employed roughly 47,000 people at the international unit at
the end of 2019, the report discloses. For the Japanese operation,
the company in November rolled out a voluntary early retirement
program for employees 40 and older. Those who accept will become
independent contractors working under a newly established group
company.
Dentsu said it is weighing options for domestic operations,
including potential staff cuts, the Nikkei relays.
Dentsu Group Inc. provides comprehensive advertising services. The
Company offers marketing, event planning, event promotion,
advertising planning, and other services. Dentsu Group also
provides information services.
=====================
P H I L I P P I N E S
=====================
PHILIPPINE AIRLINES: Woes Peril Tan's Sangley Airport Bid
---------------------------------------------------------
Miguel R. Camus at Inquirer.net reports that the ongoing financial
problems of taipan Lucio Tan's Philippine Airlines (PAL) could
weigh on the group's bid to build a PHP500-billion international
airport in Sangley Point, Cavite Gov. Jonvic Remulla said.
PAL is considering a Chapter 11 petition in the United States to
protect its assets from mainly foreign creditors and lessors while
it finalizes an estimated $5-billion debt rehabilitation plan to
weather the COVID-19 pandemic, Inquirer sources said.
Inquirer says the rehabilitation proceedings could be filed as
early as this month in New York - a venue used by other global
airlines reorganizing their businesses during the global health
crisis.
This is unfolding as Tan's MacroAsia Corp. is seeking to build the
first phase of the Sangley Point International Airport (SPIA)
through a venture with China Communications Construction Co. Ltd.
(CCCC), the report notes.
The first phase will cost an estimated PHP208.5 billion, Inquirer
says.
While the bidding was concluded a month before the pandemic caused
strict lockdowns in the Philippines, the venture only recently
submitted its final requirements to the Cavite government for
evaluation.
Mr. Remulla told the Inquirer PAL's problems were a separate
internal matter of the Tan group but they were also waiting for
developments here to materialize.
"If [the rehabilitation filing] does happen then we will further
scrutinize their submission," Mr. Remulla said in a text message.
"Their internals are to their discretion if they will reveal," he
added. "I have to reiterate that we will wait."
Asked whether the local government had set a deadline, Mr. Remulla
said their evaluation was ongoing, Inquirer adds.
The SPIA is a massive project that involves the reclamation of
about 1,500 hectares of land on Manila Bay.
Philippine Airlines -- http://www.philippineairlines.com/-- is the
Philippines' national airline. It was the first airline in Asia
and the oldest of those currently in operation. With its corporate
headquarters in Makati City, Philippine Airlines flies both
domestic and international flights. First taking off in 1941, the
carrier has grown into a fleet of about 40 aircraft (including five
Boeing 747-400s) flying to more than 20 domestic points and about
30 foreign destinations.
=================
S I N G A P O R E
=================
SEA NAVIGATION: Placed in Voluntary Liquidation
-----------------------------------------------
Manifold Times reports that Sea Navigation Shipping Pte Ltd has
been placed in voluntary liquidation.
According to the report, two notices were published in the
Government Gazette on December 7, regarding the company's voluntary
liquidation.
Manifold Times relates that the first notice was regarding some
resolutions that were passed during the company’s Extraordinary
General Meeting of the Company held on December 1. In the
meeting, the board decided the company would be wound up by way of
a members’ voluntary liquidation and JK Medora & Co LLP was
appointed as the company’s liquidator.
The second notice was an announcement for creditors to send in
their names and addresses, with particulars of their debts and
claims, and the names and addresses of their solicitors (if any) to
the appointed liquidator on or before the January 8, 2021, Manifold
Times relays.
If required by the liquidator, proofs are to be submitted
personally or by creditors’ solicitors, in order to prove their
said debts or creditors will risk being excluded from the benefit
of any distribution made before such debts are proved, the report
notes.
Based in Singapore, Sea Navigation Shipping Pte Ltd engages in
shipping lines trading, investments and provision of services in
the maritime sector.
*********
S U B S C R I P T I O N I N F O R M A T I O N
Troubled Company Reporter-Asia Pacific is a daily newsletter co-
published by Bankruptcy Creditors' Service, Inc., Fairless Hills,
Pennsylvania, USA, and Beard Group, Inc., Washington, D.C., USA.
Marites O. Claro, Joy A. Agravante, Rousel Elaine T. Fernandez,
Julie Anne L. Toledo, Ivy B. Magdadaro and Peter A. Chapman,
Editors.
Copyright 2020. All rights reserved. ISSN: 1520-9482.
This material is copyrighted and any commercial use, resale or
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*** End of Transmission ***