/raid1/www/Hosts/bankrupt/TCRAP_Public/210617.mbx
T R O U B L E D C O M P A N Y R E P O R T E R
A S I A P A C I F I C
Thursday, June 17, 2021, Vol. 24, No. 115
Headlines
A U S T R A L I A
900 ANN: Second Creditors' Meeting Set for June 25
DICK SMITH: Former CFO Michael Potts Ordered to Pay AUD43MM to NAB
ICA MINING: First Creditors' Meeting Set for June 24
MEDIACLOUD AUSTRALIA: Telstra Acquires Business
MY SHARED: Second Creditors' Meeting Set for June 23
NORTH AUSTRALIAN: Administrators Seek Buyers for Businesses
SAFA SCAFFOLDING: Second Creditors' Meeting Set for June 23
SAPPHIRE (SA): Brenton Strauss Offers Creditors DOCA
WARREGO OPERATIONS: Second Creditors' Meeting Set for June 23
C H I N A
OCEANWIDE HOLDINGS: Court Auctions Shares in Listed Arm
H O N G K O N G
CHINA VAST: S&P Affirms 'B' Long-Term ICR, Outlook Stable
I N D I A
ALANKAR REAL: CRISIL Reaffirms B+ Rating on INR5.5cr Cash Loan
ANAND RICE: CRISIL Lowers Rating on INR9.58cr LT Loan to D
ASSOCIATED HOSPITALITY: CRISIL Assigns B+ Rating to INR95cr Loans
AWADH ENTERPRISES: CRISIL Keeps B Debt Ratings in Not Cooperating
BALAJI AGENCIES: CRISIL Reaffirms B+ Rating on INR15cr Loans
C.T. ENGINEERING: CRISIL Moves B Debt Rating to Not Cooperating
FAIRDEAL MOTORS: CRISIL Moves B+ Debt Rating to Not Cooperating
INDIA: Plastic Businesses May Shut Amid High Raw Material Rates
JCBL LTD: CRISIL Lowers Rating on INR29cr Cash Loan to D
KRISH CEREALS: CRISIL Lowers Rating on INR6.0cr LT Loan to D
M.M. IMPORT: CRISIL Keeps B Debt Ratings in Not Cooperating
MALHOTRA ELECTRONICS: CRISIL Cuts Rating on INR10cr Loan to D
NORTH WESTERN: CRISIL Lowers Rating on INR175cr Loans to D
ORANGE MEGASTRUCTURE: CRISIL Moves B+ Rating to Not Cooperating
PMW METAL: CRISIL Lowers Rating on INR5cr Cash Loan to D
R L AGRO: CRISIL Lowers Rating on INR29cr Cash Loan to D
RAI INDUSTRIAL: CRISIL Moves B Debt Rating to Not Cooperating
RY MIDAS: CRISIL Lowers Rating on INR30cr Loans to D
S P SUGAR: CRISIL Raises Rating on INR30cr Loans to B+
S.K. FOODS: CRISIL Lowers Rating on INR9cr Cash Loan to D
SAHA BUILDING: CRISIL Keeps B+ Debt Ratings in Not Cooperating
SAPTHAVARNA BUILDERS: CRISIL Lowers Rating on INR6.5cr Loan to D
SHA SHAMBHULAL: CRISIL Withdraws B+ Rating on INR0.75cr Loan
SHALIMAR WIRES: CRISIL Assigns B+ Rating to INR60cr New LT Loan
SHREEMUKH BUILDERS: CRISIL Keeps B+ Rating in Not Cooperating
SHRUTI TRAVELS: CRISIL Lowers Rating on INR2.7cr Loan to D
SWAGAT FOOD: CRISIL Assigns B+ Rating to INR5cr Proposed Loan
TERRA DEVELOPERS: CRISIL Moves D Debt Rating to Not Cooperating
TERRA REALCON: CRISIL Moves D Debt Rating to Not Cooperating
VASAVI AGRO: CRISIL Lowers Rating on INR21cr Loans to D
VENKATESH COTTON: CRISIL Lowers Rating on INR7.50cr Loan to B
J A P A N
JAPAN: To Narrowly Avoid Double-Dip Recession, Survey Shows
N E W Z E A L A N D
MTF PANTERA 2021: Fitch Assigns Final B+ Rating to Class F Notes
P H I L I P P I N E S
R&L INVESTMENTS: SEC Cancels License Over Fraud; Slaps PHP25M Fine
T H A I L A N D
THAI AIRWAYS: Seeks THB25 Billion Loans to Finance Operations
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A U S T R A L I A
=================
900 ANN: Second Creditors' Meeting Set for June 25
--------------------------------------------------
A second meeting of creditors in the proceedings of 900 Ann Street
Pty Ltd has been set for June 25, 2021, at 10:00 a.m. via virtual
meeting technology.
The purpose of the meeting is (1) to receive the report by the
Administrator about the business, property, affairs and financial
circumstances of the Company; and (2) for the creditors of the
Company to resolve whether the Company will execute a deed of
company arrangement, the administration should end, or the Company
be wound up.
Creditors wishing to attend are advised proofs and proxies should
be submitted to the Administrator by June 23, 2021, at 5:00 p.m.
Kaily Lyn Chua and David James Hambleton of Rodgers Reidy were
appointed as administrators of 900 Ann on May 21, 2021.
DICK SMITH: Former CFO Michael Potts Ordered to Pay AUD43MM to NAB
------------------------------------------------------------------
Julia Talevski at ARN reports that the former CFO of failed
technology retailer Dick Smith, Michael Potts, has been ordered by
the NSW Supreme Court to fork out AUD43 million plus interest to
National Australia Bank (NAB) following allegations of misleading
and deceptive conduct.
Mr. Potts was the retailer's CFO from 2013 until its spectacular
demise in 2016.
Initially, Dick Smith Holdings (DSH) receivers, Ferrier Hodgson,
pursued eight former directors and executives of the collapsed
electronics retailer with a damages claim worth millions in March
2017, alleging that the former directors and executives breached
their duties by failing to implement an "adequate system" related
to rebates and inventory management, the report recalls.
ARN relates that the legal action alleges that Dick Smith's
earnings in 2015 were inflated thanks to the use of a "rebate
maximising" strategy that compelled managers to make stock
purchasing decisions based on rebates instead of customer demand.
The initial statement of claim took aim at former executives Nick
Abboud, who was CEO, and Mr. Potts, as well as former directors
Bill Wavish, Jamie Tomlinson, Rob Murray and Phil Cave.
Two banks associated with DSH - NAB and HSBC - decided to pursue
Mr. Potts along with Mr. Abboud in relation to the misleading and
deceptive conduct in which they were alleged to have engaged, in
connection with the syndicated facility and extension agreement,
which is said to have "induced the banks to enter those
agreements", ARN relays citing court documents.
In June 2015, the retailer replaced its Westpac facility with a
syndicated facility agreement and associated agreements with NAB
and HSBC, where NAB agreed to provide working capital facilities to
DSH up to a total commitment of AUD75 million and HSBC agreed to
provide an overdraft financing facility to DSH up to a total
commitment of AUD60 million, ARN recalls. On November 16, 2015,
HSBC agreed to increase its total commitment from AUD60 million to
AUD80 million until January 2016.
Accordingly, Justice Michael Ball found that NAB advanced money as
a result of misleading and deceptive conduct in exchange for a
promise to repay that money and security, and that Mr. Potts did
engage in misleading conduct when he said that the increase in the
overdraft with HSBC was to fund the acquisition of additional stock
for the Boxing Day sales.
About Dick Smith
Dick Smith Holdings Limited Ltd was a retailer of consumer
electronics products in Australia.
As reported in the Troubled Company Reporter-Asia Pacific on Jan.
6, 2016, Dick Smith Holdings Ltd was placed in receivership on Jan.
5 following the appointment of Voluntary Administrators.
Ferrier Hodgson partners James Stewart, Jim Sarantinos and Ryan
Eagle were appointed Receivers and Managers over DSH and a number
of associated entities. The appointment was made by a syndicate of
lenders which hold security over the group.
The TCR-AP, citing Otago Daily Times, reported on July 26, 2016,
that the creditors of Dick Smith have voted in favor of
liquidation. According to the report, administrator McGrathNicol
will take over as liquidator of 10 companies within the Dick Smith
group following the vote by creditors at a meeting in Sydney on
July 25. ODT related that McGrathNicol will continue to focus on
the exact reasons for Dick Smith's collapse, and who is to blame.
ICA MINING: First Creditors' Meeting Set for June 24
----------------------------------------------------
A first meeting of the creditors in the proceedings of:
- ICA Mining Pty Ltd
- Peko Bull Pty Ltd
- Peko Rehabilitation Project Pty Ltd
- Sitzler Savage Pty Ltd
will be held on June 24, 2021, at 10:30 a.m. via teleconference
only.
Sule Arnautovic of Hall Chadwick was appointed as administrator of
ICA Mining on June 13, 2021.
MEDIACLOUD AUSTRALIA: Telstra Acquires Business
-----------------------------------------------
Nico Arboleda at CRN reports that Telstra has acquired Perth-based
web hosting and cloud services provider Mediacloud Australia for an
undisclosed sum.
According to CRN, the deal would provide Telstra's global
broadcasting arm Telstra Broadcast Services (TBS) with
software-defined and cloud-based capabilities, as well as a number
of media cloud delivery experts and a Master Control Room in the
United Kingdom.
As part of the acquisition, Australian free-to-air TV channel SBS
also renewed its playout contract for MediaCloud services for seven
years and will be a TBS customer throughout its duration, CRN
relays.
Head of Telstra Broadcast Services Andreas Eriksson said that the
addition of the MediaCloud platform will provide broadcasters with
incredible flexibility to manage their content offerings through
virtual environments.
"The global media industry is expanding to cloud-enabled and
software-defined capabilities. Adding these leading new
capabilities alongside TBS's existing global fibre and satellite
networks sets us up to meet the evolving needs of the broadcast
market as well as expand our value proposition to our global client
base by providing a world-class broadcast operations [centre] in
London," CRN quotes Mr. Eriksson as saying.
"The new capabilities will help broadcasters deploy new services
and channels to respond to special events, programming
opportunities and new markets in these changing times."
According to the report, Telstra said the new capabilities would
enable TBS to offer new services, including managed streaming,
internet delivery, media management and content orchestration and
playout services.
Speaking on the contract renewal, SBS acting chief technology
officer Darren Farnham said, "We're pleased to have extended our
agreement for MediaCloud services with the backing of Telstra, and
to continue delivering SBS's unique content to audiences on their
device of choice."
In a report from Insolvency News Online in April, Telstra had been
eyeing Mediacloud "for some time" as its parent company cut off
funding, CRN relays.
Mediacloud was founded in June 2020 as a holding company on behalf
of UK-based Deluxe Broadcast Services Ltd, with SBS as a major
client. After a restructuring and winding up of Deluxe, funding to
Mediacloud was cut and the company called in administrators in
November 2020.
MY SHARED: Second Creditors' Meeting Set for June 23
----------------------------------------------------
A second meeting of creditors in the proceedings of My Shared
Services Pty Ltd has been set for June 23, 2021, at 11:00 a.m. via
teleconference facilities.
The purpose of the meeting is (1) to receive the report by the
Administrator about the business, property, affairs and financial
circumstances of the Company; and (2) for the creditors of the
Company to resolve whether the Company will execute a deed of
company arrangement, the administration should end, or the Company
be wound up.
Creditors wishing to attend are advised proofs and proxies should
be submitted to the Administrator by June 22, 2021, at 4:00 p.m.
Richard Rohrt of Hamilton Murphy was appointed as administrator of
My Shared on May 18, 2021.
NORTH AUSTRALIAN: Administrators Seek Buyers for Businesses
-----------------------------------------------------------
Beef Central reports that administrators appointed to manage the
affairs of live exporter North Australian Cattle Co and its sister
company, Southern Australian Cattle Co have called for expressions
of interest from investors interested in buying the businesses.
According to Beef Central, administrators Melissa Lau and Jimmy
Trpcevski from Jirsh Sutherland are seeking urgent expressions of
interest from parties interested in acquiring the business
operations and assets - either entire or in part - of NACC and/or
SACC.
The assets include live export and boxed meat export, slaughter and
livestock export licenses, and intellectual property, an
administrator's statement said, Beef Central relays.
Interested parties will be required to sign a confidentiality
agreement and due diligence prior to submission of indicative
offers should be sought from the information contained in the
Information Pack and the online Data Room.
Once one of Australia's largest live cattle exporters, NACC was
last month placed into voluntary administration, with debts owed to
trade creditors of approximately $3.6 million, Beef Central
discloses.
Expressions of interest in the purchase of the businesses is
requested by the administrators by 5pm (AEST) this Friday, June 18,
Beef Central notes.
Inquiries can be directed to Timothy Pope on (07) 3152 0214
timothyp@jirschsutherland.com.au
SAFA SCAFFOLDING: Second Creditors' Meeting Set for June 23
-----------------------------------------------------------
A second meeting of creditors in the proceedings of Safa
Scaffolding Pty Ltd has been set for June 23, 2021, at 10:30 a.m.
via teleconference.
The purpose of the meeting is (1) to receive the report by the
Administrator about the business, property, affairs and financial
circumstances of the Company; and (2) for the creditors of the
Company to resolve whether the Company will execute a deed of
company arrangement, the administration should end, or the Company
be wound up.
Creditors wishing to attend are advised proofs and proxies should
be submitted to the Administrator by June 22, 2021, at 4:00 p.m.
Terry Grant Van der Velde of SV Partners was appointed as
administrator of Safa Scaffolding on June 2, 2021.
SAPPHIRE (SA): Brenton Strauss Offers Creditors DOCA
----------------------------------------------------
Peter Hemphill at The Weekly Times reports that grain trader
Brenton Strauss has offered to pay 171 long-suffering unsecured
creditors a total of $140,000 to end the liquidation of his company
Sapphire (SA) Pty Ltd.
The Weekly Times relates that Mr. Strauss proposed a Deed of
Company Arrangement which would have seen creditors receive just
1.4 cents in the dollar seven years after Sapphire (SA) collapsed.
Acceptance of the offer by creditors would see the company free to
trade again.
It was the second DoCA proposed by Mr Strauss after Sapphire (SA)
was placed in liquidation in March, 2014, with debts of $10
million, the report notes.
The first offered two payments of 10 cents in the dollar, one in
February, 2015, followed by another 12 months later.
Sapphire (SA) traded as River City Grain Co in Victoria, NSW and
Queensland and as RiverCity Grain Co in SA.
A week before Sapphire (SA) collapsed, Mr. Strauss began trading as
River City Grain under a new company Whites Hill (SA), registered
in the name of Peter Jacobs.
Mr. Strauss continues to trade under Whites Hill (SA).
According to The Weekly Times, Sapphire (SA) creditor and member of
the company's committee of inspection overseeing the liquidation
Stuart Ellis said Mr. Strauss made an offer of 20 cents in the
dollar early in the company's administration.
"But when we started asking questions, it was reduced to 10 cents
in the dollar," Mr. Ellis said.
He said Sapphire (SA)' creditors rejected the first DoCA and the
committee of inspection recently spurned the latest offer.
"What a farce. It's an absolute joke," the report quotes Mr. Ellis
as saying.
A circular seen by The Weekly Times shows Sapphire (SA) liquidator
Anthony Matthews & Associates and lawyers have received the lion's
share of $500,000 of proceeds gained from the liquidation.
"Everybody gets money out of the liquidation bar the poor old
creditors," Mr. Ellis, as cited by The Weekly Times, said. "There
is not a cent in it for creditors."
WARREGO OPERATIONS: Second Creditors' Meeting Set for June 23
-------------------------------------------------------------
A second meeting of creditors in the proceedings of Warrego
Operations Pty Ltd has been set for June 23, 2021, at 11:00 a.m.
Virtual Meeting on Microsoft Teams and at the offices of David
Clout & Associates, Level 3/26 Wharf Street, in Brisbane,
Queensland.
The purpose of the meeting is (1) to receive the report by the
Administrator about the business, property, affairs and financial
circumstances of the Company; and (2) for the creditors of the
Company to resolve whether the Company will execute a deed of
company arrangement, the administration should end, or the Company
be wound up.
Creditors wishing to attend are advised proofs and proxies should
be submitted to the Administrator by June 22, 2021, at 4:00 p.m.
David Lewis Clout of David Clout & Associates was appointed as
administrator of Warrego Operations on May 20, 2021.
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C H I N A
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OCEANWIDE HOLDINGS: Court Auctions Shares in Listed Arm
-------------------------------------------------------
Caixin Global reports that Oceanwide Holdings Co. Ltd. faces major
shareholding changes after part of its equity was put up for
judicial sale by its indebted controlling shareholder.
A total of 294 million of Oceanwide Holdings' shares were auctioned
between June 14 and June 15, Caixin discloses citing records from a
judicial auction platform run by Alibaba Group. The equity,
originally held by biggest shareholder China Oceanwide Holdings
Group Co. Ltd., accounted for 3.39% of Oceanwide Holdings.
An individual identified as Fang Zebin paid CNY262 million ($41
million) for 117.6 million shares, Caixin says. After the
acquisition, Fang became the second-largest shareholder of
Oceanwide Holdings with 226 million shares. Another individual,
Zhang Yu, bought 58.8 million shares for CNY136 million, auction
records showed. The rest of the shares failed to be sold.
Oceanwide Holdings Co Ltd is a China-based company principally
engaged in the development and distribution of real estates and the
provision of financial services. The Company operates four business
segments. The Real Estate Business segment is engaged in real
estate development and construction, property leasing, real estate
investment, decoration projects, real estate management and
property services, and its products include residences, apartments,
hotels, office buildings and large-scale complexes. The Financial
Business segment is engaged in securities, investment, futures,
insurance, trust and financial information service businesses. The
Capital Investment Business segment is engaged in strategic
investment business. The Energy Power Business is engaged in the
construction and production of power projects. The Company mainly
conducts its businesses in the China market.
=================
H O N G K O N G
=================
CHINA VAST: S&P Affirms 'B' Long-Term ICR, Outlook Stable
---------------------------------------------------------
S&P Global Ratings affirmed its 'B' long-term issuer credit rating
on China VAST Industrial Urban Development Co. Ltd. (VAST) and its
'B-' long-term issue rating on the company's outstanding senior
unsecured notes.
S&P said, "The stable outlook on VAST reflects our view that the
company will continue to generate positive operating cash flow and
will slow down investments in non-core parks to conserve cash
outflow over the next 12 months.
"We affirmed the ratings on VAST because we view the partial
repurchase and cancellation of US$90 million of its total of US$180
million in senior unsecured notes due June 28, 2021, as
opportunistic rather than distressed."
VAST has sufficient resources to repay the senior notes in
full.VAST, the notes issuing entity, has offshore cash equivalent
of about US$100 million as of mid-May. The Wang family, controlling
shareholder with a 74% majority stake in VAST, also plans to
provide a shareholder's loan to the company to redeem the rest of
the notes. The shareholder has demonstrated a track record of
providing loans to support VAST over the past few years.
S&P asid, "We expect VAST's own offshore cash and controlling
shareholder's liquidity injection to sufficiently cover the notes
repayment. This is one of the primary reasons we don't view the
transaction as distressed; VAST is unlikely to default on the notes
in the absence of a successful partial repurchase."
The terms of the repurchase fulfils the promise on the original
notes. According to the company, it paid cash for US$90 million of
the notes at par, in addition to accrued interest up to the date of
cancellation. As such, S&P believes the investors participating in
the repurchase did not receive less than they were originally
promised. S&P estimates VAST has sufficient cash offshore to pay
down the remaining notes via further repurchase or at maturity.
Reliance on Longhe Park will continue to constrain VAST's credit
profile.Longhe Park contributed more than 80% of VAST's total
revenue in 2020 and will likely continue to drive its performance
over the next one to two years; VAST has been slowing its
diversification efforts in developing other newer parks since 2019.
S&P therefore expects VAST's revenue recognition to remain highly
correlated to land sales in Longhe Park. This was case in 2020,
when VAST's revenue fell 10%, partly owing to a delay in auctions
in Longhe Park.
S&P said, "The stable outlook reflects our expectation that VAST
will continue to generate positive operating cash flow, helped by
strong performance of Longhe Park, and mildly improve leverage over
the next 12-18 months.
"The outlook also reflects our view that VAST will slow down
investments in other industrial parks to conserve cash outflow and
control debt growth.
"We could lower the rating if the company cannot maintain positive
operating cash flow and if debt leverage rises above 4.0x for a
prolonged period. This could be due to weaker land and property
sales than we currently expect. Such a scenario could occur as a
result of weak macroeconomic conditions or policy interference,
lengthened collection periods of trade receivables associated with
land development, or aggressive construction spending or other
investments that significantly increase debt.
"We could upgrade VAST if the company has steady land sales at
Longhe Park, accelerated cash inflow from other industrial parks,
and moderately expands its other industrial parks to reduce
reliance on Longhe Park." Indication of such improvement would be:
(1) the ratio of debt to EBITDA staying consistently below 4.0x;
and (2) the company's geographical diversification materially
improving such that other industrial parks consistently contribute
25% of EBITDA and operating cash flow, resulting in sustainably
positive operating cash flow.
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I N D I A
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ALANKAR REAL: CRISIL Reaffirms B+ Rating on INR5.5cr Cash Loan
--------------------------------------------------------------
CRISIL Ratings has reaffirmed its 'CRISIL B+/Stable/CRISIL A4'
ratings on the bank facilities of Alankar Real Estates Pvt Ltd
(AREPL).
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Bank Guarantee 3 CRISIL A4 (Reaffirmed)
Cash Credit 5.5 CRISIL B+/Stable (Reaffirmed)
The ratings reflect the company's modest scale of operations in the
competitive infrastructure construction segment, below-average
financial risk profile and large working capital requirement. These
weaknesses are partially offset by the promoters' extensive
experience in the civil construction segment and their funding
support.
Analytical approach
Unsecured loan has been treated as debt.
Key rating drivers and detailed description
Weaknesses
* Modest scale amid intense competition: Revenue is estimated at a
modest INR20.5 crore in fiscal 2021. The company's modest scale in
the competitive infrastructure industry restricts its ability to
bid for large projects. Also, operations are tender-based, thereby
reducing pricing flexibility.
* Below-average financial risk profile: Financial risk profile is
constrained by small networth of INR7.4 crore and high gearing and
TOLANW of 1.78 times and 2.2 times, respectively, as on March 31,
2021. Debt protection metrics were average, indicated by interest
coverage and net cash accrual to total debt ratios of 1.5 times and
0.05 time, respectively, in fiscal 2021. The financial risk profile
is expected to remain below-average, owing to low accretion to
reserves and high reliance of external debt over the medium term.
* Large working capital requirement: Gross current assets are
estimated at 315 days as on March 31, 2021, driven by large
inventory of 170 days, owing to higher work-in progress and
moderate receivables of 45 days, along with sizeable security
deposits and retention money with government departments.
Strength
* Extensive experience of the promoter and their funding support:
The two-decade-long experience of the key promoter has enabled him
to bid successfully for projects and execute them efficiently.
Also, the promoter has been supporting the business through
unsecured loans.
Liquidity: Stretched
Bank limit was fully utilised over the 12 months through March
2021. Net cash accrual is expected to be modest at INR0.90-1.1
crore per annum, but it will sufficiently cover yearly debt
obligation of INR0.60 crore over the medium term. Liquidity is
partially supported by need-based funds from the promoter. The
company maintains cash and bank balance of INR30 lakhs as on March
31, 2021.
Outlook: Stable
AREPL will continue to benefit from the expected moderate growth in
the infrastructure construction industry.
Rating sensitivity factors
Upward factors
* Sustained increase in revenue by 25% per fiscal along with a
stable operating margin
* Efficient working capital management with GCA below 250 days
Downward factors
* Decline in revenue by 15% per fiscal and fall in profitability,
impacting cash accruals
* Stretch in the working capital cycle, leading to higher debt
Incorporated in 1994 and based in Nagpur, Maharashtra, AREPL
undertakes civil projects, such as construction of roads, bridges
and buildings. Mr. Sutinderpalsingh Arora and his family members
are the promoters of the company.
ANAND RICE: CRISIL Lowers Rating on INR9.58cr LT Loan to D
----------------------------------------------------------
CRISIL Ratings has downgraded the ratings on the bank facilities of
Anand Rice Mills (ARM, part of SK Foods group) to 'CRISIL D Issuer
Not Cooperating' from 'CRISIL B+/Stable Issuer Not Cooperating'.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Cash Credit 9 CRISIL D (ISSUER NOT
COOPERATING; Downgraded from
'CRISIL B+/Stable ISSUER NOT
COOPERATING')
Proposed Long Term 9.58 CRISIL D (ISSUER NOT
Bank Loan Facility COOPERATING; Downgraded from
'CRISIL B+/Stable ISSUER NOT
COOPERATING')
Term Loan 1.42 CRISIL D (ISSUER NOT
COOPERATING; Downgraded from
'CRISIL B+/Stable ISSUER NOT
COOPERATING')
Export Packing 9 CRISIL D (ISSUER NOT
Credit COOPERATING; Downgraded from
'CRISIL B+/Stable ISSUER NOT
COOPERATING')
CRISIL Ratings has been consistently following up with ARM for
obtaining information through emails dated August 22, 2020,
February 16, 2021 and June 2, 2021 among others; apart from
telephonic communication. However, the issuer has remained
non-cooperative.
'The investors, lenders and all other market participants should
exercise due caution with reference to the rating assigned/reviewed
with the suffix 'ISSUER NOT COOPERATING' as the rating is arrived
at without any management interaction and is based on best
available or limited or dated information on the company. Such non
co-operation by a rated entity may be a result of deterioration in
its credit risk profile. These ratings with 'ISSUER NOT
COOPERATING' suffix lack a forward looking component.'
Detailed Rationale
Despite repeated attempts to engage with the management, CRISIL
Ratings failed to receive any information on either the financial
performance or strategic intent of SK Foods group, which restricts
the ability of CRISIL Ratings to take a forward-looking view on the
group's credit quality. CRISIL Ratings believe the rating action on
the group is consistent with 'Assessing Information Adequacy Risk'.
On account of irregularity in the group's account conduct (as per
publicly available information), characterised by delays in debt
servicing for more than 30 days, the ratings on the bank facilities
of ARM has been downgraded to 'CRISIL D Issuer Not Cooperating'
from 'CRISIL B+/Stable Issuer Not Cooperating'.
About the Group
ARM was set up in 2001 as a proprietorship and was reconstituted as
a partnership on April 1, 2014 by Mr. Surender Kumar, Mr. Sunil
Kumar and Mr. Pankaj Singla. It mills and sorts rice, and its unit
has capacity of 12 tph.
Incorporated in 2010, KCPL initially traded rice; in 2013, it
started milling and sorting rice, with a unit having capacity of 8
tph.
Established in 2015, SKF is a partnership firm of Mr. Surender
Kumar and Mr. Dinesh Kumar, with unit having capacity of 10 tph.
RLF was set up in 1998 as a proprietorship firm by Mr. Subhash
Chand and was reconstituted as a partnership firm, on September 1,
2014, with Mr. Sunil Kumar coming onboard. It mills and sorts rice
and its unit has a capacity of 12 tonne per hour (tph).
All the four units are located at Nissing in Karnal (Haryana).
ASSOCIATED HOSPITALITY: CRISIL Assigns B+ Rating to INR95cr Loans
-----------------------------------------------------------------
CRISIL Ratings has assigned its 'CRISIL B+/Stable' rating to the
long term bank facilities of Associated Hospitality Pvt Ltd
(AHPL).
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Proposed Working
Capital Facility 0.9 CRISIL B+/Stable (Assigned)
Term Loan 94.1 CRISIL B+/Stable (Assigned)
The rating reflect exposure of AHPL to risks related to its ongoing
project and subsequent ramp-up, estimated below-average financial
risk profile amid early phase of operations and exposure to
cyclicality in the hospitality industry. These weaknesses are
partially offset by the promoters' extensive experience in the
hotels and resorts industry and their funding support.
Analytical approach
Unsecured loan of INR20.05 crore provided by promoters and their
associates as on March 31, 2021, has been treated as neither debt
nor equity, as the loan is subordinated to bank debt.
Key rating drivers and detailed description
Weaknesses:
* Exposure to risks related to ongoing project: AHPL is
constructing a 210-room hotel near Mumbai International Airport
under the 'Fairfield by Marriott' brand. The hotel is expected to
be completed by November 2021, following which it will start
commercial operations. The project has been delayed primarily on
account of the Covid-19 pandemic, though there were no major cost
overruns. Timely completion of the project and subsequent ramp-up
remain critical and will be monitored.
* Below-average financial risk profile: Of the total project cost
of approximately INR135 crore, INR85 crore is debt-funded, leading
to project gearing of about 1.8 times. Furthermore, cash accrual
would be low in the initial phase, and the company may need to
contract working capital debt as well. Gearing is expected to
remain moderately high at about 2 times in the near-to-medium term.
Generation of adequate cash accrual to cover the scheduled debt
repayment remains critical.
* Exposure to cyclicality in the hospitality industry: The hotel
industry is susceptible to changes in the domestic and
international economy. Typically, the industry follows a cycle, and
business and earnings are affected in a downward cycle.
Furthermore, the upcoming hotel of AHPL is located close to the
Mumbai International Airport; hence, demand remains susceptible to
travel bans and other regulatory changes amid the pandemic. Risk of
geographic concentration will persist, with revenue being derived
from a sole property in Mumbai. Any location-specific events may
weaken the business risk profile.
Strength:
* Promoters' extensive experience and funding support: The
two-decade-long experience of the promoters and their strong
understanding of the market dynamics have enabled them to establish
a robust market position for the company. The promoters have also
been successfully operating other hotels under its group concerns.
This experience will help them ramp up operations in the new
project. The promoters will provide funding support to the company
in case of any exigency.
Liquidity: Stretched
Liquidity will remain stretched on account of the company being in
early phase of operations. Commercial operations are expected to
start this fiscal, with fiscal 2023 being the first full year of
operations. Successful and significant ramp-up of operations and
healthy operating profitability will be key monitorables. Net cash
accrual is expected to be tightly matched with the debt obligation
and will also be contingent on successful ramp-up of operations.
The company has been sanctioned Emergency Credit Line Guarantee
Scheme, which shall provide flexibility in the project
implementation phase. Funding support from the promoters will be
critical to cushion the liquidity in the initial phase.
Outlook: Stable
AHPL will continue to benefit from the promoters' extensive
experience.
Rating sensitivity factors
Upward factors
* Timely completion of the project and successful ramp-up of
operations along with healthy operating margin leading to increase
in cash accrual
* Capital infusion leading to gearing of less than 1.2 times
Downward factors
* Considerable delay in commencement of operations or significantly
lower ramp-up in sales
* Cash accrual to debt repayment ratio of less than 1 time
* Weakening of the financial risk profile
Incorporated in 2012, AHPL is setting up three-star hotel in Mumbai
through a franchise agreement with Global Hospitality Licensing
S.A.R.L under the 'Fairfield by Marriott' brand. The hotel will
have more than 200 guest rooms, a multi-cuisine restaurant,
conference hall, gym and other facilities. Operations are managed
by Mr. Hussein Abdul Karim Balwa, Mr. Ismail Abdul Karim Balwa and
Mr. Umar Abdul Karim.
AWADH ENTERPRISES: CRISIL Keeps B Debt Ratings in Not Cooperating
-----------------------------------------------------------------
CRISIL Ratings said the ratings on bank facilities of Awadh
Enterprises - Varanasi (AEV) continue to be 'CRISIL B/Stable Issuer
Not Cooperating'.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Cash Credit 11.25 CRISIL B/Stable (Issuer Not
Cooperating)
Proposed Long Term 1.25 CRISIL B/Stable (Issuer Not
Bank Loan Facility Cooperating)
CRISIL Ratings has been consistently following up with AEV for
obtaining information through letters and emails dated November 21,
2020 and May 19, 2021 among others, apart from telephonic
communication. However, the issuer has remained non cooperative.
'The investors, lenders and all other market participants should
exercise due caution with reference to the rating assigned/reviewed
with the suffix 'ISSUER NOT COOPERATING' as the rating is arrived
at without any management interaction and is based on best
available or limited or dated information on the company. Such non
co-operation by a rated entity may be a result of deterioration in
its credit risk profile. These ratings with 'ISSUER NOT
COOPERATING' suffix lack a forward looking component.'
Detailed Rationale
Despite repeated attempts to engage with the management, CRISIL
Ratings failed to receive any information on either the financial
performance or strategic intent of AEV, which restricts CRISIL
Ratings' ability to take a forward looking view on the entity's
credit quality. CRISIL Ratings believes that rating action on AEV
is consistent with 'Assessing Information Adequacy Risk'. Based on
the last available information, the ratings on bank facilities of
AEV continues to be 'CRISIL B/Stable Issuer Not Cooperating'.
Set up in 2013, AEV is a proprietorship firm of Mr. Amit Agrawal,
who looks after operations. The firm trades in coal in Varanasi,
Uttar Pradesh, and nearby areas.
BALAJI AGENCIES: CRISIL Reaffirms B+ Rating on INR15cr Loans
------------------------------------------------------------
CRISIL Ratings has reaffirmed its 'CRISIL B+/Stable' rating on the
bank facilities of Sri Balaji Agencies (SBA).
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Cash Credit 8 CRISIL B+/Stable (Reaffirmed)
Inventory Funding
Facility 5 CRISIL B+/Stable (Reaffirmed)
Proposed Long Term
Bank Loan Facility 2 CRISIL B+/Stable (Reaffirmed)
The rating continues to reflect the modest scale of SBA's
operations in an intensely competitive segment, and a weak
financial risk profile. These weaknesses are partially offset by
the extensive experience of the proprietor.
Key Rating Drivers & Detailed Description
Weakness:
* Modest scale of operations amid intense competition:
The iron and steel trading industry in India is dominated by
numerous unorganised players catering to local demand. The
consequent intense competition may continue to constrain
scalability, pricing power and profitability. Revenue is estimated
at INR53 crore for fiscal 2021.
* Weak financial risk profile: Networth was low estimated at
INR2.50 crores as on March 31, 2021, with the total outside
liabilities to tangible networth (TOLTNW) ratio high at 8.5 times
as on same date. Though TOLTNW ratio is expected to improve over
the medium term with steady accretion to reserves, this will remain
high. Debt protection metrics were subdued, with estimated interest
coverage of 1.2 times for fiscal 2021.
Strengths:
* Extensive experience of proprietor: Benefits from the
proprietor's experience of over two decades and keen understanding
of local market dynamics, and healthy relations with suppliers and
customers should continue to support the business.
Liquidity: Stretched
Cash accrual at INR0.4 – 0.5 crore per annum over the medium term
are likely to remain sufficient against yearly debt obligation of
INR0.3 crore. The liquidity is cushioned by additional funding
support from promoters in the form of unsecured loans.
Additionally, there will not be any significant withdrawals from
the firm. Cash Credit of INR7.95 crore was highly utilized at an
average of around 94% during the 12 months through April 2021.
Outlook Stable
CRISIL Ratings believes SBA will continue to benefit from the
extensive trading experience of the proprietor.
Rating Sensitivity factors
Upward factors:
* Substantial increase in revenue and profitability, leading to
higher cash accruals of over INR1 crore
* Improvement in capital structure leading to TOLTNW less than 2
times
Downward factors:
* Steep decline in revenue and profitability or higher than
expected capital withdrawals, resulting in lower cash accrual of
less than 0.1 crores
* Any large, debt-funded capital expenditure plan or stretch in
working capital requirements deteriorates financial risk profile
especially liquidity.
SBA was set up in 2008 by the proprietor, Ms Anupama Khemka. This
Chennai-based firm is a dealer of Jindal Steel and Power Limited
products. Mr. Munish Khemka manages the operations.
C.T. ENGINEERING: CRISIL Moves B Debt Rating to Not Cooperating
---------------------------------------------------------------
CRISIL Ratings has migrated the rating on bank facilities of C.T.
Engineering Polymers Private Limited (CTEPL) to 'CRISIL
B/Stable/CRISIL A4 Issuer Not Cooperating'.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Cash Credit 0.5 CRISIL B/Stable (ISSUER NOT
COOPERATING; Rating Migrated)
Letter of Credit 14.5 CRISIL A4 (ISSUER NOT
COOPERATING; Rating Migrated)
CRISIL Ratings has been consistently following up with CTEPL for
obtaining information through letters and emails dated March 31,
2021 and April 23, 2021 among others, apart from telephonic
communication. However, the issuer has remained non cooperative.
'The investors, lenders and all other market participants should
exercise due caution with reference to the rating assigned/reviewed
with the suffix 'ISSUER NOT COOPERATING' as the rating is arrived
at without any management interaction and is based on best
available or limited or dated information on the company. Such non
co-operation by a rated entity may be a result of deterioration in
its credit risk profile. These ratings with 'ISSUER NOT
COOPERATING' suffix lack a forward looking component.'
Detailed Rationale
Despite repeated attempts to engage with the management, CRISIL
Ratings failed to receive any information on either the financial
performance or strategic intent of CTEPL, which restricts CRISIL
Ratings' ability to take a forward looking view on the entity's
credit quality. CRISIL Ratings believes that rating action on CTEPL
is consistent with 'Assessing Information Adequacy Risk'.
Therefore, on account of inadequate information and lack of
management cooperation, CRISIL Ratings has migrated the rating on
bank facilities of CTEPL to 'CRISIL B/Stable/CRISIL A4 Issuer Not
Cooperating'.
Incorporated in 2017, CTEPL is a private limited company promoted
by Mr. Rishub Jain and his brother, Mr. Abhishek Jain. The company
trades in polymers such as polyvinyl chloride resin, high- and
low-density poly ethylene, and poly propylene. CTEPL is based in
Delhi. The company imports traded goods from Korea, Thailand, USA
and China for sale in India. Commercial operations started in June
2017.
FAIRDEAL MOTORS: CRISIL Moves B+ Debt Rating to Not Cooperating
---------------------------------------------------------------
CRISIL Ratings has migrated the rating on bank facilities of
Fairdeal Motors and Workshop Private Limited (FMWPL) to 'CRISIL
B+/Stable Issuer not cooperating'.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Cash Credit 50 CRISIL B+/Stable (ISSUER NOT
COOPERATING; Rating Migrated)
CRISIL Ratings has been consistently following up with FMWPL for
obtaining information through letters and emails dated March 31,
2021 and April 23, 2021 among others, apart from telephonic
communication. However, the issuer has remained non cooperative.
'The investors, lenders and all other market participants should
exercise due caution with reference to the rating assigned/reviewed
with the suffix 'ISSUER NOT COOPERATING' as the rating is arrived
at without any management interaction and is based on best
available or limited or dated information on the company. Such non
co-operation by a rated entity may be a result of deterioration in
its credit risk profile. These ratings with 'ISSUER NOT
COOPERATING' suffix lack a forward looking component.'
Detailed Rationale
Despite repeated attempts to engage with the management, CRISIL
Ratings failed to receive any information on either the financial
performance or strategic intent of FMWPL, which restricts CRISIL
Ratings' ability to take a forward looking view on the entity's
credit quality. CRISIL Ratings believes that rating action on FMWPL
is consistent with 'Assessing Information Adequacy Risk'.
Therefore, on account of inadequate information and lack of
management cooperation, CRISIL Ratings has migrated the rating on
bank facilities of FMWPL to 'CRISIL B+/Stable Issuer not
cooperating'.
Incorporated in 1971, FMWPL is engaged in the sale of commercial
vehicles (CV) and passenger vehicles (PV) of Tata Motors Ltd,
servicing of vehicles and sale of spare parts. FMWPL operates
through 2 showrooms and service center in Jammu and Srinagar. It is
owned & managed by Mr. Bakshi Bashir Ahmed, Mr. Saleem Bakshi and
Mrs. Yasmin Bakshi.
INDIA: Plastic Businesses May Shut Amid High Raw Material Rates
---------------------------------------------------------------
The Times of India reports that the plastic raw material traders
and product manufacturers of the city of Ludhiana in Punjab are
passing through the worst phase of their lives with about 70% of
them close to shutting shops and factories and facing bankruptcy.
Huge rise in the rates of raw materials during the past one year
and a fall in demand are to be blamed for the situation, the report
says. This was revealed by the Plastic Manufacturers' and Traders'
Association (PMTA), which claimed that rates of raw materials have
gone up by four times in some cases and sales reduced to 25%.
Despite this, the fixed expenses, like minimum power charge, wages
and rents, have remained the same, causing a turmoil in the
industry, it said.
According to TOI, PMTA president Gurdeep Singh Batra said, "Close
to 70% of traders and factory owners dealing with plastic raw
material or making plastic goods are on the verge of permanent
closure. Rates of raw materials have gone up four times and there
is hardly any demand. The statements of the Central and the state
governments have proven to be totally false, take for example the
Centre and the RBI's claim that collateral-free loans are being
given by banks."
Batra added, "Banks are refusing loans to Ludhiana businessmen
without a collateral. Situation is so bad that earlier when we used
to pledge properties for availing loans, we were given loans of up
to 150% of our property's value, but now not even 50% is being
offered. The day is not far when Ludhiana will see hundreds of
shops, factories, offices connected with plastic business close
permanently. Once prosperous businessmen will soon be bankrupt."
Mukesh Marjara, general secretary of the PMTA, said, "During the
past one year, the rate of acrylonitrile butadiene styrene (ABS)
has skyrocketed from INR85 per kg to INR320 per kg. The rate of low
density polyethylene (LDP) has gone up to INR120 per kg from INR80
per kg. Similarly, the rate of linear low density polyethylene
(LLDP) has increased from INR62 per kg to INR92 per kg. The rate of
polypropylene (PP) has increased from INR72 per kg to INR100 per
kg. Few months back, the rates had gone up even more, but due to no
demand in the market, these fell but are still almost four times of
what they used to be last year."
TOI adds that Mohan Lal Khurana, association chairman, said, "We
have been into this business for decades and have seen many ups and
downs, but this is for the first time that we are witnessing such a
situation when the closure of hundreds of businesses seems
inevitable. The main reasons for this turmoil are unjustified
increase in the rates of plastic raw materials, fall in demand to
almost 25% due to lockdowns, no financial support from banks to
fight the crisis and no relaxation in the recurring expenses, like
fixed power charges, rent, property and municipal taxes, among
others."
JCBL LTD: CRISIL Lowers Rating on INR29cr Cash Loan to D
--------------------------------------------------------
CRISIL Ratings has downgraded its ratings on the bank facilities of
JCBL Ltd (JCBL) to 'CRISIL D/CRISIL D Issuer Not Cooperating' from
'CRISIL B-/Stable/CRISIL A4 Issuer Not Cooperating' because of
delay in meeting debt obligation by the company.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Bank Guarantee 6 CRISIL D (ISSUER NOT COOPERATING;
Downgraded from CRISIL A4 ISSUER
NOT COOPERATING')
Cash Credit 29 CRISIL D (ISSUER NOT COOPERATING;
Downgraded from 'CRISIL B-/Stable
ISSUER NOT COOPERATING')
Corporate Loan 11.92 CRISIL D (ISSUER NOT COOPERATING;
Downgraded from 'CRISIL B-/Stable
ISSUER NOT COOPERATING')
Foreign Exchange 2 CRISIL D (ISSUER NOT COOPERATING;
Forward Downgraded from CRISIL A4 ISSUER
NOT COOPERATING')
Inland/Import 22 CRISIL D (ISSUER NOT COOPERATING;
Letter of Credit Downgraded from CRISIL A4 ISSUER
NOT COOPERATING')
Long Term Loan 1.68 CRISIL D (ISSUER NOT COOPERATING;
Downgraded from 'CRISIL B-/Stable
ISSUER NOT COOPERATING')
Proposed Long 22.40 CRISIL D (ISSUER NOT COOPERATING;
Term Bank Loan Downgraded from 'CRISIL B-/Stable
Facility ISSUER NOT COOPERATING')
Rupee Term Loan 15 CRISIL D (ISSUER NOT COOPERATING;
Downgraded from 'CRISIL B-/Stable
ISSUER NOT COOPERATING')
CRISIL Ratings has been consistently following up with JCBL,
through letters and emails dated February 22, 2021, apart from
telephonic communication, for obtaining information. However, the
issuer has remained non-cooperative.
The investors, lenders and all other market participants should
exercise due caution with reference to the rating assigned/reviewed
with the suffix 'ISSUER NOT COOPERATING' as the rating is arrived
at without any management interaction and is based on best
available or limited or dated information on the company. Such
non-co-operation by a rated entity may be a result of deterioration
in its credit risk profile. These ratings with 'ISSUER NOT
COOPERATING' suffix lack a forward looking component.
Detailed Rationale
Despite repeated attempts to engage with the company's management,
CRISIL Ratings did not receive any information on the financial
performance or strategic intent of JCBL, which restricts the
ability of CRISIL Ratings to take a forward looking view on the
entity's credit quality. The rating action on JCBL is consistent
with 'Assessing Information Adequacy Risk'. Based on the last
available information, CRISIL Ratings has now downgraded its
ratings on the bank facilities of JCBL to 'CRISIL D/CRISIL D Issuer
Not Cooperating' from 'CRISIL B-/Stable/CRISIL A4 Issuer Not
Cooperating' because of delay in meeting debt obligation by the
company.
Incorporated in 1989, JCBL is promoted by Mr. Rajinder Aggarwal.
The Chandigarh-based company manufactures bus bodies for luxury
coaches and special vehicles such as ambulances, mobile automated
teller machines (ATMs), bullet-proof vans (for politicians),
political campaign vehicles and hospitals-on-wheels. It also
manufactures transport containers.
KRISH CEREALS: CRISIL Lowers Rating on INR6.0cr LT Loan to D
------------------------------------------------------------
CRISIL Rating has downgraded the rating on the bank facilities of
Krish Cereals Private Limited (KCPL, part of SK Foods group) to
'CRISIL D Issuer Not Cooperating' from 'CRISIL B+/Stable Issuer Not
Cooperating'.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Cash Credit 6 CRISIL D (ISSUER NOT COOPERATING;
Downgraded from 'CRISIL B+/Stable
ISSUER NOT COOPERATING')
Proposed Long 6 CRISIL D (ISSUER NOT COOPERATING;
Term Bank Downgraded from 'CRISIL B+/Stable
Loan Facility ISSUER NOT COOPERATING')
Term Loan 3 CRISIL D (ISSUER NOT COOPERATING;
Downgraded from 'CRISIL B+/Stable
ISSUER NOT COOPERATING')
CRISIL Ratings has been consistently following up with KCPL for
obtaining information through emails dated August 22, 2020,
February 16, 2021 and June 2, 2021 among others; apart from
telephonic communication. However, the issuer has remained
non-cooperative.
'The investors, lenders and all other market participants should
exercise due caution with reference to the rating assigned/reviewed
with the suffix 'ISSUER NOT COOPERATING' as the rating is arrived
at without any management interaction and is based on best
available or limited or dated information on the company. Such non
co-operation by a rated entity may be a result of deterioration in
its credit risk profile. These ratings with 'ISSUER NOT
COOPERATING' suffix lack a forward looking component.'
Detailed Rationale
Despite repeated attempts to engage with the management, CRISIL
Ratings failed to receive any information on either the financial
performance or strategic intent of SK Foods group, which restricts
the ability of CRISIL Ratings to take a forward-looking view on the
group's credit quality. CRISIL Ratings believe the rating action on
the group is consistent with 'Assessing Information Adequacy Risk'.
On account of irregularity in the group's account conduct (as per
publicly available information), characterised by delays in debt
servicing for more than 30 days, the rating on the bank facilities
of KCPL have been downgraded to 'CRISIL D Issuer Not Cooperating'
from 'CRISIL B+/Stable Issuer Not Cooperating'.
Incorporated in 2010, KCPL initially traded rice; in 2013, it
started milling and sorting rice, with a unit having capacity of 8
tph.
Established in 2015, SKF is a partnership firm of Mr. Surender
Kumar and Mr. Dinesh Kumar, with unit having capacity of 10 tph.
RLF was set up in 1998 as a proprietorship firm by Mr. Subhash
Chand and was reconstituted as a partnership firm, on September 1,
2014, with Mr. Sunil Kumar coming onboard. It mills and sorts rice
and its unit has a capacity of 12 tonne per hour (tph).
ARM was set up in 2001 as a proprietorship and was reconstituted as
a partnership on April 1, 2014 by Mr. Surender Kumar, Mr. Sunil
Kumar and Mr. Pankaj Singla. It mills and sorts rice, and its unit
has capacity of 12 tph.
All the four units are located at Nissing in Karnal (Haryana).
M.M. IMPORT: CRISIL Keeps B Debt Ratings in Not Cooperating
-----------------------------------------------------------
CRISIL Ratings said the ratings on bank facilities of M.M. Import
and Export (MMIE) continue to be 'CRISIL B/Stable/CRISIL A4 Issuer
Not Cooperating'.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Cash Credit 1 CRISIL B/Stable (Issuer Not
Cooperating)
Letter of Credit 7 CRISIL A4 (Issuer Not
Cooperating)
CRISIL Ratings has been consistently following up with MMIE for
obtaining information through letters and emails dated November 21,
2020 and May 19, 2021 among others, apart from telephonic
communication. However, the issuer has remained non cooperative.
'The investors, lenders and all other market participants should
exercise due caution with reference to the rating assigned/reviewed
with the suffix 'ISSUER NOT COOPERATING' as the rating is arrived
at without any management interaction and is based on best
available or limited or dated information on the company. Such non
co-operation by a rated entity may be a result of deterioration in
its credit risk profile. These ratings with 'ISSUER NOT
COOPERATING' suffix lack a forward looking component.'
Detailed Rationale
Despite repeated attempts to engage with the management, CRISIL
Ratings failed to receive any information on either the financial
performance or strategic intent of MMIE, which restricts CRISIL
Ratings' ability to take a forward looking view on the entity's
credit quality. CRISIL Ratings believes that rating action on MMIE
is consistent with 'Assessing Information Adequacy Risk'. Based on
the last available information, the ratings on bank facilities of
MMIE continues to be 'CRISIL B/Stable/CRISIL A4 Issuer Not
Cooperating'.
MMIE was set up as a partnership firm in 2009 and is engaged in
timber trading. The firm located in Muvattupuzha, Kerala and
promoted by Mr. Kasirath Tharfia and Mr. Abdul Kalam Kutty is
engaged in trading of sawn timber and log wood.
MALHOTRA ELECTRONICS: CRISIL Cuts Rating on INR10cr Loan to D
-------------------------------------------------------------
CRISIL Ratings has downgraded its ratings on the bank loan
facilities of Malhotra Electronics Private Limited (MEPL) to
'CRISIL D/CRISIL D' from 'CRISIL BB/Stable/CRISIL A4+'.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Bill Discounting 10 CRISIL D (Downgraded from
under Letter 'CRISIL A4+')
of Credit
Cash Credit 8 CRISIL D (Downgraded from
'CRISIL BB/Stable')
Letter of Credit 34 CRISIL D (Downgraded from
'CRISIL A4+')
The downgrade in the ratings reflect delays in the regularization
of overdues in the cash credit account beyond 30 days and
devolvement in the Letter of Credit (LC) between Apr'21 to June'21
due to cash flow mismatches.
The ratings continue to reflect the exposure to intense competition
leading to modest operating profitability, and moderate working
capital requirement extensive experience of the promoters in the
consumer electronics industry and above average financial risk
profile. These weaknesses are partially offset by promoter's
experience in the consumer electronics industry and above average
financial risk profile.
Analytical Approach
Unsecured loans of INR15.17 crore as on March 31, 2020, extended by
promoters have been treated as neither debt nor equity, as the
loans carry a low interest rate, and should remain in the business
over the medium term.
Key Rating Drivers & Detailed Description
Weaknesses:
* Overdue in the Cash credit account beyond 30 days due to LC
devolvement: MEPL's LCs got devolved during Apr'21 to June'21 which
resulted in overdrawals in the Cash credit account for more than 30
days. The devolvement happened on account of cash flow mismatches
as company did not receive its payments on time from the
counterparties.
* Exposure to intense competition: Company faces intense
competition in the consumer durable industry especially from
organized and large players such as LG Electronics Inc, Samsung
India Electronics Pvt Ltd, and Philips India Ltd. Also, MEPL faces
competition from small, regional brands that control the local
market. This has led to low operating profitability in the range of
3-5.5% over the four fiscals through 2020. Although operating
profitability did improve from 3.5-4.0% in the three fiscals
through fiscal 2020, on account of cost efficiency due to backward
integration in manufacturing.
* Moderate scale of operations: Revenue declined marginally to
INR335.62 crore in fiscal 2020 from INR342.27 crore in fiscal 2019.
In current fiscal also, revenue is expected to steeply decline as
the company has booked INR212 crore revenue till Feb'21 due to the
country wide lockdown in April and May 2020. However, CRISIL
expects the revenue will increase over the medium term as the
company has started manufacturing of air conditioner from current
fiscal.
* Moderate working capital requirement: Gross current assets were
moderate at 98 days as on March 31, 2020. However, working capital
requirement is expected to increase as the company has added new
products in their product mix, that too with highly seasonal in
nature. Hence, working capital management over the medium term will
be a key monitorable.
Strengths:
* Extensive industry experience of the promoters: The promoter
family has been in the consumer electronics industry since 1978,
resulting in established relationships with customers. Though the
product mix is diversified, LED TVs are the major contributor to
revenue. Backed by the promoters' experience, the company has
established its own brands - WYBOR, Egovision, and Orson -- from
which it now generates around 50% of revenue. Growth in sales over
the medium term will be driven by increased sales of LED TVs along
with launch of new products ie air conditioners. The established
distribution network will support penetration of the new products
in the market.
* Above-average financial metrics: The gearing remained at ~0.53
times and net worth was above average, at INR34.09 crore, as on
March 31, 2020. The promoter has infused USL to support the
additional working capital risk profile requirement. The total
outside liability to tangible net-worth expected to remain less
than 2 times over the medium term. Debt protection metrics are
above average, indicated by interest coverage and net cash accrual
to total debt ratios of 4.99 times and 0.64 time, respectively, for
fiscal 2020.
Liquidity: Poor
Liquidity is likely to remain under pressure over the medium term,
mainly due to large working capital requirement and delays from the
realization from the customer.
Rating Sensitivity factors
Upward factors
* Track record of timely payment of interest and regularization of
cash credit for three months.
* Efficient working capital management which led to cushion in the
bank limit utilization
MEPL was incorporated in 1986 but started operations in 2005. It is
promoted by Mr. Ravinder Singh Malhotra, and family members Mr.
Gaganpreet Singh Malhotra and Mr. Gurpreet Singh Malhotra. The
company, based in Delhi, manufactures LED TVs, multimedia speakers,
washing machine and other white goods, at its facility in Greater
Noida, Uttar Pradesh. In current fiscal 2021, company has started
the manufacturing of Air condition.
NORTH WESTERN: CRISIL Lowers Rating on INR175cr Loans to D
----------------------------------------------------------
CRISIL Ratings has downgraded its rating on the long-term bank
facilities of North Western Karnataka Road Transport Corporation
(NWKRTC) to 'CRISIL D' from 'CRISIL BB-/Stable'. The rating
reflects delay in servicing of term debt obligation.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Proposed Long Term 73.96 CRISIL D (Downgraded from
Bank Loan Facility 'CRISIL BB-/Stable')
Term Loan 101.04 CRISIL D (Downgraded from
'CRISIL BB-/Stable')
The rating continues to reflect operational and managerial support
from the Government of Karnataka (GoK). This strength is partially
offset by delay in debt servicing, a below-average financial risk
profile owing to large accumulated loss, and low operating
profitability.
Key Rating Drivers & Detailed Description
Weaknesses
* Delay in debt servicing: There have been delays in servicing of
debt obligations due to no business operations impacting daily
collections. The operations have been shut down since 28th April
2021 due to lockdown announced by the government. NWKRTC defaulted
on its term debt repayments of INR1.5 crore each that were due on
May 4, 2021 and May 29, 2021 due to poor liquidity position.
* Below-average financial risk profile: Due to large accumulated
losses and low profitability in the past, the debt protection
metrics remain under pressure. The financial risk profile is
expected to remain under pressure due to subdued profitability.
* Low operating profitability: Being a GoK-supported organisation,
the corporation has a mandate of providing affordable transport
services to the public. Hence, it does not have the flexibility of
changing the bus fare on account of an increase in fuel or other
operating costs, thereby constraining profitability. The
profitability is expected to remain under pressure.
Strength
* Strong financial, operational, and managerial support from the
state government: The corporation is strongly supported by GoK,
given the importance given by the latter for providing public
transport to all regions of the state. NWKRTC is one of the four
transport corporations set up by the state government to offer
affordable transport services. Due to its strategic importance to
GoK, it enjoys need-based financial support from the government as
seen in regular grants received. The top management consists of
senior officials of GoK, indicating a strong linkage to the state
government.
Liquidity: Poor
The liquidity is poor as the corporation has been unable to meet
its term debt obligations due in May 2021. The term debt repayments
are serviced through the collections in the bus depots which were
nil since 28th April 2021 due to closure of operations on account
of lockdown imposed by the government owing to second wave of
covid-19.
Rating Sensitivity Factors
Upward factors:
* Track record of timely debt servicing for atleast over 90 days.
* Improvement in liquidity supported by better daily collections
NWKRTC was set up in 1997, under provision of the Road Transport
Corporation Act, 1950, following the bifurcation of the Karnataka
State Road Transport Corporation. NWKRTC is wholly owned by GoK.
The sole purpose of its creation is to provide extensive bus
transport services in North-West Karnataka, including to remote and
non-profitable locations across the region.
ORANGE MEGASTRUCTURE: CRISIL Moves B+ Rating to Not Cooperating
---------------------------------------------------------------
CRISIL Ratings has migrated the rating on bank facilities of Orange
Megastructure LLP (OMLLP) to 'CRISIL B+/Stable Issuer Not
Cooperating' and removed it from 'Rating Watch with Negative
Implications'.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Cash Credit 2.5 CRISIL B+/Stable (ISSUER NOT
COOPERATING; Migrated from
'CRISIL BB-; Removed from
'Rating Watch with Negative
Implications')
Lease Rental 140.0 CRISIL B+/Stable (ISSUER NOT
Discounting Loan COOPERATING; Migrated from
'CRISIL BB-; Removed from
'Rating Watch with Negative
Implications')
Long Term Loan 15.0 CRISIL B+/Stable (ISSUER NOT
COOPERATING; Migrated from
'CRISIL BB-; Removed from
'Rating Watch with Negative
Implications')
Proposed Fund- 0.5 CRISIL B+/Stable (ISSUER NOT
Based Bank Limits COOPERATING; Migrated from
'CRISIL BB-; Removed from
'Rating Watch with Negative
Implications')
CRISIL Ratings has been consistently following up with OMLLP for
obtaining information through letters and emails dated May 24, 2021
and May 31, 2021 among others, apart from telephonic communication.
However, the issuer has remained non cooperative.
'The investors, lenders and all other market participants should
exercise due caution with reference to the rating assigned/reviewed
with the suffix 'ISSUER NOT COOPERATING' as the rating is arrived
at without any management interaction and is based on best
available or limited or dated information on the company. Such non
co-operation by a rated entity may be a result of deterioration in
its credit risk profile. These ratings with 'ISSUER NOT
COOPERATING' suffix lack a forward looking component.'
Detailed Rationale
OMLLP had applied for one-time restructuring (OTR) of its term loan
in first week of October 2020, under the Reserve Bank of India's
(RBI's) guidelines issued on August 06, 2020, called Resolution
Framework for Covid-19-related Stress. Subsequently, on December
31, 2020, the lenders had invoked the process of OTR, however the
restructuring plan finalization and the lender's approval on the
same, was pending. Further, as per the last understanding, OMLLP
had serviced its debt repayment obligation till the month of
November-2020, while debt repayment obligations post December-2020
had not been paid, as the OTR application was under process.
CRISIL Ratings has been consistently following up with OMLLP for
updates on the OTR process and the outcome thereof, if any.
However, despite repeated attempts to engage with the management,
CRISIL Ratings failed to receive any update on the aforementioned
OTR process, and also has not received information on either the
financial performance or strategic intent of OMLLP, which restricts
CRISIL Ratings' ability to take a forward looking view on the
entity's credit quality. CRISIL Ratings believes that rating action
on OMLLP is consistent with 'Assessing Information Adequacy Risk'.
Therefore, on account of inadequate information and lack of
management cooperation, CRISIL Ratings has migrated the rating on
bank facilities of OMLLP to 'CRISIL B+/Stable Issuer Not
Cooperating' and removed it from 'Rating Watch with Negative
Implications'.
OMLLP owns Le-Meridien, a five-star hotel in Surat. The firm is
promoted by Century 21 Town Planners Pvt Ltd, Mr. Rajesh Mehta and
Mr. Gurjeet Singh Chhabra with shareholding of 49.92%, 50% and
0.08% respectively. The firm is operational from April 2017.
PMW METAL: CRISIL Lowers Rating on INR5cr Cash Loan to D
--------------------------------------------------------
CRISIL Ratings has downgraded its rating on the long-term bank
facilities of PMW Metal and Alloys Pvt Ltd to 'CRISIL D' from
'CRISIL B/Stable'. The rating downgrade reflects the delays of
more than 30 days in servicing of debt obligations on FITL loan.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Cash Credit 5 CRISIL D (Downgraded from
'CRISIL B/Stable')
Long Term Loan 4.6 CRISIL D (Downgraded from
'CRISIL B/Stable')
Proposed Fund- 0.1 CRISIL D (Downgraded from
Based Bank Limits
'CRISIL B/Stable')
The rating continues to reflect the company's modest scale of
operations and weak financial risk profile. These weaknesses are
partially offset by the extensive experience of the promoter in the
lead battery industry.
Analytical Approach
Unsecured loans (INR4.21 crore as on March 31, 2020) PMW by the
promoter and his family members have been treated as 75% equity and
25% debt as the loans are subordinated to bank debt and should
remain in the business over the medium term.
Key Rating Drivers & Detailed Description
Weaknesses
* Delays in servicing debt obligation: PMW has availed FITL loan
from UCO Bank. There have been delays in severing debt obligation
on FITL loan by the company for more than 30 days in the last two
months.
* Modest scale of operations: Although revenue rose to INR19.09
crore in fiscal 2020 from INR4.76 crore in fiscal 2018 on account
of operationalization of the new unit for manufacturing lead, the
scale remains small. The modest scale and low capacity utilisation
led to low operating margin and negative net cash accrual in fiscal
2020. However, In Fiscal 2021, scale of operations have improved as
the company has acquired a new customer and getting frequent orders
from them. PMW has booked around INR40 crore of revenue in fiscal
2021.
* Weak financial risk profile: Networth was modest at INR4.60 crore
and gearing high at 2.26 times as on March 31, 2020. Debt
protection metrics were below average in fiscal 2020, as indicated
by interest coverage of less than 1 time.
Strength
* Experienced management and reputed clientele: The promoter's
experience of ten years in the battery industry has helped the
company establish long-term relationships with customers such as
Luminous Power Technologies.
Liquidity: Poor
Liquidity is likely to remain under pressure over the medium term,
mainly due to large working capital requirements. Bank limits are
almost fully utilised in the 12 months through March 2021.
Rating Sensitivity factors
Upward factors
* Track record of timely payments on term loan obligations for more
than three months.
* Improvement in scale of operations along with profitability.
PMW was established in 2011 by Mr. Jagdish Prasad Karnani. The
company provides charging facility to battery manufacturers at its
unit at Gagret in Una, Himachal Pradesh. It set up a lead cube
manufacturing plant in 2019.
R L AGRO: CRISIL Lowers Rating on INR29cr Cash Loan to D
--------------------------------------------------------
CRISIL Ratings has downgraded the ratings on the bank facilities of
R L Agro Foods Pvt Ltd (RLF; a part of the SK Foods group) to
'CRISIL D/CRISIL D Issuer Not Cooperating' from 'CRISIL
B+/Stable/CRISIL A4 Issuer Not Cooperating'.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Cash Credit 29 CRISIL D (ISSUER NOT COOPERATING;
Downgraded from 'CRISIL B+/Stable
ISSUER NOT COOPERATING')
Line of Credit 1 CRISIL D (ISSUER NOT COOPERATING;
Downgraded from 'CRISIL B+/Stable
ISSUER NOT COOPERATING')
Packing Credit 15 CRISIL D (ISSUER NOT COOPERATING;
Downgraded from 'CRISIL A4 ISSUER
NOT COOPERATING')
Warehouse 5 CRISIL D (ISSUER NOT COOPERATING;
Financing Downgraded from 'CRISIL B+/Stable
ISSUER NOT COOPERATING')
CRISIL Ratings has been consistently following up with RLF for
obtaining information through emails dated August 22, 2020,
February 16, 2021, and June 2, 2021; apart from telephonic
communication. However, the issuer has remained non-cooperative.
The investors, lenders and all other market participants should
exercise due caution with reference to the ratings
assigned/reviewed with the suffix 'issuer not cooperating' as the
ratings are arrived at without any management interaction and are
based on best-available or limited or dated information on the
entity. Such non-cooperation by a rated entity may be a result of
deterioration in its credit risk profile. These ratings with
'issuer not cooperating' suffix lack a forward-looking component.
Detailed Rationale
Despite repeated attempts to engage with the management, CRISIL
Ratings failed to receive any information on either the financial
performance or strategic intent of the SK Foods group, which
restricts the ability of CRISIL Ratings to take a forward-looking
view on the credit quality of the group. CRISIL Ratings believes
the rating action on the group is consistent with 'Assessing
Information Adequacy Risk'.
On account of irregularity in the group's account conduct (as per
publicly available information), characterised by delays in debt
servicing for more than 30 days, the ratings on the bank facilities
of RLF have been downgraded to 'CRISIL D/CRISIL D Issuer Not
Cooperating' from 'CRISIL B+/Stable/CRISIL A4 Issuer Not
Cooperating'.
Analytical Approach
For arriving at the ratings, CRISIL Ratings has combined the
business and financial risk profiles of RLF, S K Foods (SKF), Anand
Rice Mills (ARM) and Krish Cereals Pvt Ltd (KCPL). This is because
these entities, collectively referred to as the SK Foods group,
have common promoters and management and are in the same line of
business.
About the Group
RLF was set up in 1998 as a proprietorship by Mr. Subhash Chand and
got reconstituted as a partnership firm on September 1, 2014, with
Mr. Sunil Kumar coming aboard. It mills and sorts rice, with
capacity of 12 tonne per hour (tph).
ARM was formed in 2001 as a proprietorship firm; it was converted
into a partnership on April 1, 2014, by Mr. Surender Kumar, Mr.
Sunil Kumar and Mr. Pankaj Singla. The firm mills and sorts rice,
with capacity of 12 tph.
KCPL, incorporated in 2010, initially traded in rice. From 2013, it
started milling and sorting rice, with capacity of 8 tph.
SKF was set up in 2015 as a partnership firm of Mr. Surender Kumar
and Mr. Dinesh Kumar. The firm mills and sorts rice, with capacity
of 10 tph.
All the four units are in Nissing (Karnal; Haryana).
Status of noncooperation with previous CRA
RLF had not cooperated with Credit Analysis and Research Ltd and
ICRA Ltd, which classified it as non-cooperative vide release dated
May 7, 2021 and May 21, 2021 respectively. The reason provided by
Credit Analysis and Research Ltd and ICRA Ltd is non-furnishing of
information by RLF for monitoring of ratings.
RAI INDUSTRIAL: CRISIL Moves B Debt Rating to Not Cooperating
-------------------------------------------------------------
CRISIL Ratings has migrated the rating on bank facilities of Rai
Industrial Power Private Limited (RIPPL) to 'CRISIL B/Stable/CRISIL
A4 Issuer not cooperating'.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Bank Guarantee 1.28 CRISIL A4 (ISSUER NOT
COOPERATING; Rating Migrated)
Cash Credit 8.00 CRISIL B/Stable (ISSUER NOT
COOPERATING; Rating Migrated)
CRISIL Ratings has been consistently following up with RIPPL for
obtaining information through letters and emails dated March 31,
2021 and April 23, 2021 among others, apart from telephonic
communication. However, the issuer has remained non cooperative.
'The investors, lenders and all other market participants should
exercise due caution with reference to the rating assigned/reviewed
with the suffix 'ISSUER NOT COOPERATING' as the rating is arrived
at without any management interaction and is based on best
available or limited or dated information on the company. Such non
co-operation by a rated entity may be a result of deterioration in
its credit risk profile. These ratings with 'ISSUER NOT
COOPERATING' suffix lack a forward looking component.'
Detailed Rationale
Despite repeated attempts to engage with the management, CRISIL
Ratings failed to receive any information on either the financial
performance or strategic intent of RIPPL, which restricts CRISIL
Ratings' ability to take a forward looking view on the entity's
credit quality. CRISIL Ratings believes that rating action on RIPPL
is consistent with 'Assessing Information Adequacy Risk'.
Therefore, on account of inadequate information and lack of
management cooperation, CRISIL Ratings has migrated the rating on
bank facilities of RIPPL to 'CRISIL B/Stable/CRISIL A4 Issuer not
cooperating'.
Incorporated on June 9, 1997, and promoted by Mr. Yadav Rai and Ms
Shilpi Rai, RIPPL is engaged in trading of spare parts,
commissioning, erection, annual maintenance contracts, and
operations and maintenance of diesel generator sets.
RY MIDAS: CRISIL Lowers Rating on INR30cr Loans to D
----------------------------------------------------
CRISIL Ratings has downgraded the rating on the long-term bank
facility of the RY Midas Alluminiums Private Limited (RY) to
'CRISIL D Issuer Not Cooperating' from 'CRISIL BB/Stable Issuer Not
Cooperating.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Cash Credit 19 CRISIL D (ISSUER NOT COOPERATING;
Downgraded from 'CRISIL BB/Stable
ISSUER NOT COOPERATING')
Long Term Loan 1 CRISIL D (ISSUER NOT COOPERATING;
Downgraded from 'CRISIL BB/Stable
ISSUER NOT COOPERATING')
Working Capital 10 CRISIL D (ISSUER NOT COOPERATING;
Demand Loan Downgraded from 'CRISIL BB/Stable
ISSUER NOT COOPERATING')
CRISIL Ratings has been consistently following up with RY for
obtaining information through letters and emails dated
October 31, 2020, December 7, 2020 and December 12, 2020 among
others, apart from telephonic communication. However, the issuer
has remained non cooperative.
The investors, lenders and all other market participants should
exercise due caution with reference to the rating assigned/reviewed
with the suffix 'ISSUER NOT COOPERATING' as the rating is arrived
at without any management interaction and is based on best
available or limited or dated information on the company. Such
non-co-operation by a rated entity may be a result of deterioration
in its credit risk profile. These ratings with 'ISSUER NOT
COOPERATING' suffix lack a forward looking component.
Detailed Rationale
Despite repeated attempts to engage with the management, CRISIL
Ratings failed to receive any information on either the financial
performance or strategic intent of RY, which restricts CRISIL
Ratings' ability to take a forward looking view on the entity's
credit quality. CRISIL Ratings believes that rating action on RY is
consistent with 'Assessing Information Adequacy Risk'.
Based on the publicly available information and delay in bank
obligations, CRISIL Ratings has downgraded the rating on the
long-term bank facility of the RY to 'CRISIL D Issuer Not
Cooperating' from 'CRISIL BB/Stable Issuer Not Cooperating.
RY was incorporated in 2006, promoted by Mr. Jagdishchandra
Baluramji Shah and Ms Ashaben Jagdishchandra Shah. The company
trades in metals and alloys. In fiscal 2016, it commenced
manufacturing aluminium ingots using aluminium/copper alloy waste
or scrap at its facility in Ahmedabad, Gujarat.
S P SUGAR: CRISIL Raises Rating on INR30cr Loans to B+
------------------------------------------------------
CRISIL Ratings has upgraded its rating on the long-term bank
facilities of S P Sugar & Agro Pvt Ltd (SPSAPL) to 'CRISIL
B+/Stable' from 'CRISIL B/Stable'.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Cash Credit 5 CRISIL B+/Stable (Upgraded from
'CRISIL B/Stable')
Long Term Loan 25 CRISIL B+/Stable (Upgraded from
'CRISIL B/Stable')
The upgrade reflects improvement in business risk profile of SPSAPL
driven by improved operating profitability and growth in revenue,
resulting in higher than expected net cash accruals. Revenue
increased to INR65.45 crore in fiscal 2021 from INR5.01 crore in
fiscal 2018; and should continue to grow over the medium term as
well, backed by addition of new products supported by the new
capacity being set up in the current fiscal. Financial risk
profile, especially capital structure and liquidity should also
gradually improve with higher accretion to reserves, despite the
ongoing capital expenditure.
The rating also factors in the susceptibility of SPSAPL to changes
in government regulations, large working capital requirement and
exposure to moderate project risk. These weaknesses are partly
offset by extensive experience of the promoters in the sugar
industry.
Key Rating Drivers & Detailed Description
Weaknesses
* Susceptibility to changes in government regulations regarding the
sugar industry: The sugar industry is highly regulated, with
government controls on pricing and supply of sugarcane. Hence, the
sugar industry, and consequently the business risk profile of
players such as SPSAPL, will remain susceptible to government
regulations in the long run. Large working capital requirement,
driven by high inventory because of seasonal availability of the
raw material (sugarcane). Gross current assets were 229 days as on
March 31, 2021, owing to inventory of 231 days and debtors of 26
days.
* Exposure to project risk: The company is undertaking a project of
INR16 crore for setting up a soybean solvent plant, which is
expected to be completed by October 2021. Technology and funding
risks may be moderate as the company is using reputable technology
and is funding about 45% of the project through internal cash
accrual. However, SPSAPL could face risks related to project
implementation and stabilisation of operations in a timely manner
and thereafter getting steady demand for its product.
Strength
* Experience of promoters: Though SPSAPL started operations just
seven years ago, the key promoter -- Mr. Suresh Patil -- has been
in the sugar and jaggery business since for over two decades.
Benefits from the promoters' experience, their strong understanding
of local market dynamics and healthy relations with suppliers and
customers should continue to support the business.
Liquidity: Poor
Liquidity is poor on account tight cushion between net cash
accruals and repayment obligations. Cash accrual is expected to be
in range of INR7.0-INR7.5 crore per annum over the medium term
against yearly repayment obligation of INR5.2-6.7 crore. Current
ratio and unencumbered cash and bank balance were low at 1.15 times
and INR68 lakhs as on March 31, 2021. However, liquidity is
supported by moderate bank limit utilisation which averaged at 54%
for the 12 months through March 2021.
Outlook Stable
SPSAPL will continue to benefit from the extensive experience of
its promoters.
Rating Sensitivity factors
Upward factors
* Sustenance of improved operating margin and growth in revenue
resulting in cushion between cash accruals and repayment obligation
increasing above 1.5 times
* Timely completion of capex and steady ramp up
* Improvement in financial risk profile on back of better working
capital management
Downward factors
* Lower than expected revenue or operating margin resulting in
cushion between net cash accruals and repayment obligation falling
below 1 time
* Any large, debt-funded capital expenditure or a further stretch
in the working capital cycle
SPSAPL, incorporated in 2014, manufactures jaggery powder and solid
jaggery at its facility in Osmanabad, Maharashtra; it commenced
operations from December 2017. Mr. Suresh Patil and his family
members are the promoters.
S.K. FOODS: CRISIL Lowers Rating on INR9cr Cash Loan to D
---------------------------------------------------------
CRISIL Ratings has revised the rating on the long-term bank
facilities of S.K. Foods (SKF; a part of the SK Foods group) to
'CRISIL D Issuer Not Cooperating' from 'CRISIL B+/Stable Issuer Not
Cooperating'.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Cash Credit 9 CRISIL D (ISSUER NOT COOPERATING;
Downgraded from 'CRISIL B+/Stable
ISSUER NOT COOPERATING')
Proposed Long Term 1.1 CRISIL D (ISSUER NOT COOPERATING;
Bank Loan Facility Downgraded from 'CRISIL B+/Stable
ISSUER NOT COOPERATING')
Term Loan 2.4 CRISIL D (ISSUER NOT COOPERATING;
Downgraded from 'CRISIL B+/Stable
ISSUER NOT COOPERATING')
CRISIL Ratings has been consistently following up with SKF for
obtaining information through emails dated August 22, 2020,
February 16, 2021, and June 2, 2021; apart from telephonic
communication. However, the issuer has remained non-cooperative.
The investors, lenders and all other market participants should
exercise due caution with reference to the rating assigned/reviewed
with the suffix 'issuer not cooperating' as the rating is arrived
at without any management interaction and is based on
best-available or limited or dated information on the entity. Such
non-cooperation by a rated entity may be a result of deterioration
in its credit risk profile. This rating with 'issuer not
cooperating' suffix lacks a forward-looking component.
Detailed Rationale
Despite repeated attempts to engage with the management, CRISIL
Ratings failed to receive any information on either the financial
performance or strategic intent of the SK Foods group, which
restricts the ability of CRISIL Ratings to take a forward-looking
view on the credit quality of the group. CRISIL Ratings believes
the rating action on the group is consistent with 'Assessing
Information Adequacy Risk'.
On account of irregularity in the group's account conduct (as per
publicly available information), characterised by delays in debt
servicing for more than 30 days, the rating on the long-term bank
facilities of SKF (part of SK Foods group) has been downgraded to
'CRISIL D Issuer Not Cooperating' from 'CRISIL B+/Stable Issuer Not
Cooperating'.
About the Group
RLF was set up in 1998 as a proprietorship by Mr. Subhash Chand and
got reconstituted as a partnership firm on September 1, 2014, with
Mr. Sunil Kumar coming aboard. It mills and sorts rice, with
capacity of 12 tonne per hour (tph).
ARM was formed in 2001 as a proprietorship firm; it was converted
into a partnership on April 1, 2014, by Mr. Surender Kumar, Mr.
Sunil Kumar and Mr. Pankaj Singla. The firm mills and sorts rice,
with capacity of 12 tph.
KCPL, incorporated in 2010, initially traded in rice. From 2013, it
started milling and sorting rice, with capacity of 8 tph.
SKF was set up in 2015 as a partnership firm of Mr. Surender Kumar
and Mr. Dinesh Kumar. The firm mills and sorts rice, with capacity
of 10 tph.
All the four units are in Nissing (Karnal; Haryana).
Status of non cooperation with previous CRA:
SKF had not cooperated with Credit Analysis and Research Ltd and
ICRA Ltd, which classified it as non-cooperative vide release dated
March, 16 2021 and May 25, 2021 respectively. The reason provided
by Credit Analysis and Research Ltd and ICRA Ltd is non-furnishing
of information by SKF for monitoring of ratings.
SAHA BUILDING: CRISIL Keeps B+ Debt Ratings in Not Cooperating
--------------------------------------------------------------
CRISIL Ratings said the ratings on bank facilities of Saha Building
Centre Private Limited (SBCPL) continue to be 'CRISIL
B+/Stable/CRISIL A4 Issuer Not Cooperating'.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Bank Guarantee 3.5 CRISIL A4 (Issuer Not
Cooperating)
Cash Credit 4.0 CRISIL B+/Stable (Issuer Not
Cooperating)
Proposed Long Term 2.0 CRISIL B+/Stable (Issuer Not
Bank Loan Facility Cooperating)
CRISIL Ratings has been consistently following up with SBCPL for
obtaining information through letters and emails dated November 21,
2020 and May 19, 2021 among others, apart from telephonic
communication. However, the issuer has remained non cooperative.
'The investors, lenders and all other market participants should
exercise due caution with reference to the rating assigned/reviewed
with the suffix 'ISSUER NOT COOPERATING' as the rating is arrived
at without any management interaction and is based on best
available or limited or dated information on the company. Such non
co-operation by a rated entity may be a result of deterioration in
its credit risk profile. These ratings with 'ISSUER NOT
COOPERATING' suffix lack a forward looking component.'
Detailed Rationale
Despite repeated attempts to engage with the management, CRISIL
Ratings failed to receive any information on either the financial
performance or strategic intent of SBCPL, which restricts CRISIL
Ratings' ability to take a forward looking view on the entity's
credit quality. CRISIL Ratings believes that rating action on SBCPL
is consistent with 'Assessing Information Adequacy Risk'. Based on
the last available information, the ratings on bank facilities of
SBCPL continues to be 'CRISIL B+/Stable/CRISIL A4 Issuer Not
Cooperating'.
SBCPL was set up in 1999 as a proprietorship firm, and was
reconstituted as a private limited company in 2008. It undertakes
civil construction, mainly of buildings. The daily operations are
managed by its director Mr. Apurba Kumar Saha.
SAPTHAVARNA BUILDERS: CRISIL Lowers Rating on INR6.5cr Loan to D
----------------------------------------------------------------
CRISIL Ratings has downgraded its rating on the long term bank
facilities of Sapthavarna Builders Private Limited (SBPL) to
'CRISIL D' from 'CRISIL B+/Stable' and has assigned its 'CRISIL D'
rating to the short term facilities. The rating downgrade reflects
delays in servicing of term debt obligations.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Long Term Loan 5.5 CRISIL D (Downgraded from
'CRISIL B+/Stable')
Proposed Long Term 2.5 CRISIL D (Downgraded from
Bank Loan Facility 'CRISIL B+/Stable')
Working Capital 6.5 CRISIL D (Downgraded from
Facility 'CRISIL B+/Stable')
Proposed Short Term
Bank Loan Facility 1.4 CRISIL D (Reassigned)
Working Capital
Term Loan 0.6 CRISIL D (Reassigned)
The rating reflects the company's susceptibility to risks inherent
in the Indian real estate industry and its below-average financial
risk profile. These weaknesses are partially offset by the
extensive experience of the promoters and the company's established
track record.
Key Rating Drivers & Detailed Description
Weaknesses:
* Susceptibility to risks inherent in the Indian real estate
industry: The real estate sector in India is cyclical and has
volatile prices, opaque transactions, and a highly fragmented
market structure because of the presence of several regional
players. Moreover, multiplicity of property laws and
non-standardized government regulations are likely to affect the
tenure of project execution. The risk is compounded by aggressive
completion timelines and shortage of manpower (project engineers
and skilled labor) in this sector. Absence of regulatory
certifications on land titles exposes real estate developers to
legal risks. Also, high transaction costs discourage the
development of a robust secondary market, leading to pressure on
liquidity.
* Below-average financial risk profile: The financial risk profile
is constrained by high gearing of 2.01 times as on March 31, 2020.
Debt protection metrics were below average with interest cover of
0.44 times in fiscal 2020.
Strength:
* Extensive experience of the promoters and established track
record: SBPL has an established track record in the residential
real estate development, backed by its promoters' extensive
experience in the construction business and healthy execution
capability.
Liquidity: Poor
Liquidity is likely to remain under pressure over the medium term,
mainly due to large working capital requirements. Debt service
coverage ratio (DSCR) continues to be modest. Given the economic
slowdown because of Covid-19, bookings have been modest resulting
in lower than expected customer advances.
Rating Sensitivity factors
Upward Factors:
* Track record of timely payments on term loan obligations for more
than three months
* Healthy growth in bookings and customer advances, with cash DSCR
of more than 4 times
* Completion of projects on a timely basis
SBPL, incorporated in 2008, undertakes residential real estate
development. The company is based in Thrissur, Kerala.
SHA SHAMBHULAL: CRISIL Withdraws B+ Rating on INR0.75cr Loan
------------------------------------------------------------
CRISIL has withdrawn its ratings on the bank facilities of Sha
Shambhulal Nathalal and Co Timber Merchants (SSNACT) on the request
of the company and receipt of a no objection certificate from its
bank. The rating action is in line with CRISIL's policy on
withdrawal of its ratings on bank loans.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Cash Credit 0.75 CRISIL B+/Stable (ISSUER NOT
COOPERATING; Rating Withdrawn)
Letter of Credit 6.00 CRISIL A4 (Issuer Not
Cooperating; Rating Withdrawn)
Overdraft Facility 0.15 CRISIL A4 (Issuer Not
Cooperating; Rating Withdrawn)
Proposed Letter 3.10 CRISIL A4 (Issuer Not
of Credit Cooperating; Rating Withdrawn)
CRISIL has been consistently following up with SSNACT for obtaining
information through letters and emails dated April 29, 2020, May
29, 2020 and May 26, 2021 among others, apart from telephonic
communication. However, the issuer has remained non cooperative.
'The investors, lenders and all other market participants should
exercise due caution with reference to the rating assigned/reviewed
with the suffix 'ISSUER NOT COOPERATING' as the rating is arrived
at without any management interaction and is based on best
available or limited or dated information on the company. Such non
co-operation by a rated entity may be a result of deterioration in
its credit risk profile. These ratings with 'ISSUER NOT
COOPERATING' suffix lack a forward looking component.'
Detailed Rationale
Despite repeated attempts to engage with the management, CRISIL
failed to receive any information on either the financial
performance or strategic intent of SSNACT, which restricts CRISIL's
ability to take a forward looking view on the entity's credit
quality. CRISIL believes that rating action on SSNACT is consistent
with 'Assessing Information Adequacy Risk'. Based on the last
available information, the ratings on bank facilities of SSNACT
continues to be 'CRISIL B+/Stable/CRISIL A4 Issuer Not
Cooperating'.
CRISIL has withdrawn its ratings on the bank facilities of SSNACT
on the request of the company and receipt of a no objection
certificate from its bank. The rating action is in line with
CRISIL's policy on withdrawal of its ratings on bank loans.
Established in 1975, by Mr. Kiran Sanghavi, SSNACT is engaged in
the trading of timber. The firm mainly imports teakwood and
hardwood from Myanmar and Latin America through traders located in
Singapore. It also imports teak wood from Africa. The firm sales to
the various saw mill manufacturer.
SHALIMAR WIRES: CRISIL Assigns B+ Rating to INR60cr New LT Loan
---------------------------------------------------------------
CRISIL Ratings has assigned its 'CRISIL B+/Stable/CRISIL A4'
ratings to the bank facilities of Shalimar Wires Industries Ltd
(SWIL).
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Cash Credit 5 CRISIL B+/Stable (Assigned)
Letter of Credit 7 CRISIL A4 (Assigned)
Proposed Cash
Credit Limit 9.84 CRISIL B+/Stable (Assigned)
Proposed Long Term
Bank Loan Facility 60 CRISIL B+/Stable (Assigned)
Working Capital
Demand Loan 8.16 CRISIL B+/Stable (Assigned)
The ratings reflect its weak financial profile and large working
capital requirement. The weakness is partially offset by extensive
experience of the promoters in the metal mesh manufacturing
industry and stable revenue and profitability.
Key Rating Drivers & Detailed Description
Weaknesses:
* Weak financial risk profile: Networth is estimated at INR32 crore
as on March 31, 2021. However, on account of debt-funded capital
expenditure and repayment of financial dues (pertaining to
reconstruction approved in Board for Industrial and Financial
Reconstruction (BIFR)) funded largely from unsecured loans, gearing
is estimated at 3.02 times as on March 31, 2021. High interest cost
at bank (21%) and unsecured loan (Rs 62 crore as on March 31, 2021;
15%) have led to weak debt protection metrics, as indicated by
estimated interest coverage and net cash accrual to adjusted debt
ratios of 0.61 time and negative 0.02 time, respectively, in fiscal
2021. The company managed its finance cost though guaranteed
emergency credit line (GECL) of INR8.16 crore from Kotak Bank.
However, the management plans to take on term loan of around INR60
crore (repayable in eight years) to pay off its high-cost unsecured
loans and improve its debt protection metrics. Timely reduction of
debt will remain a key sensitivity factor.
* Large working capital requirement: Operations are expected to
remain working capital-intensive, as indicated by estimated gross
current assets (GCAs) of 206 days as on March 31, 2021, driven by
receivables and inventory of around 90 days each (inventory is
largely work-in-progress) and supported by creditors of 150-160
days.
Strengths:
* Extensive experience of the promoter: The five-decade-long
experience of the promoters in paper machine products and electric
discharge machines (EDM) wires industry, their strong understanding
of the market dynamics and healthy relationships with suppliers and
customers will continue to support the business risk profile.
* Moderate scale of operations and profitability: Revenue has
hovered at INR100-115 crore over the three fiscals through 2020 and
is estimated to have dipped to around INR90 crore in fiscal 2021 on
account of manufacturing constrains amid the Covid-19 pandemic. The
enhanced capacity became operational in fiscal 2022. Scale is
expected to improve on account of traction from the kraft paper
segment in the paper industry. Operating profitability has been
healthy at 9.5-12.7% over the four fiscals through 2021. As the
company has sold off its Nasik manufacturing unit (which had lower
profitability because of high operating overheads), profitability
is expected to improve and remain healthy over the medium term.
Liquidity: Poor
In fiscal 2021, the company is estimated to have generated cash
loss of around INR2.2 crore against maturing debt of INR1.05 crore.
The repayment was supported by unsecured loans, GECL and by
stretching the working capital cycle. In fiscal 2021 and fiscal
2022, the company paid off its long-term debt (except unsecured
loans) from sale of non-core fixed assets. Also, the average cost
of debt is expected to reduce as the company replaces high-cost
unsecured loan with lower-cost bank term loan.
Cash accrual of INR8-8.5 crore per annum should sufficiently cover
maturing debt of INR1.36 crore in fiscal 2022 and around INR6.5
crore thereafter. However, timely reduction of high-cost debt will
remain a key rating sensitivity factor. Utilisation of working
capital limit of INR5 crore averaged 79% over the 12 months through
April 2021. Current ratio is estimated at an adequate 1.5 times as
on March 31, 2021.
Outlook: Stable
SWIL will continue to benefit from the promoters' extensive
experience and healthy relationships with clients.
Rating Sensitivity factors
Upward factors
* Improvement in debt protection metrics, with interest coverage
ratio of more than 1.5 times
* Decline in adjusted debt leading to gearing of less than 2 times
Downward factors
* Longer-than-expected time taken to reduce the high-cost debt
weakening the debt protection metrics, with interest coverage of
less than 1 times
* Any stretch in the working capital cycle constraining liquidity
SWIL was incorporated in 1996 as a private limited company and was
reconstituted in 2002 as a public limited company. It manufactures
metallic fourdrinier wire cloth and dandy rolls for the paper
industry. The manufacturing unit is in Uttarpara, West Bengal. Mr.
S N Khaitan is the promoter of the company, and operations are
managed by Mr. Sunil Khaitan.
SHREEMUKH BUILDERS: CRISIL Keeps B+ Rating in Not Cooperating
-------------------------------------------------------------
CRISIL Ratings said the rating on bank facilities of Shreemukh
Builders Private Limited (Shreemukh) continues to be 'CRISIL
B+/Stable Issuer Not Cooperating'.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Secured Overdraft 30 CRISIL B+/Stable (Issuer Not
Facility Cooperating)
CRISIL Ratings has been consistently following up with Shreemukh
for obtaining information through letters and emails dated November
21, 2020 and May 19, 2021 among others, apart from telephonic
communication. However, the issuer has remained non cooperative.
'The investors, lenders and all other market participants should
exercise due caution with reference to the rating assigned/reviewed
with the suffix 'ISSUER NOT COOPERATING' as the rating is arrived
at without any management interaction and is based on best
available or limited or dated information on the company. Such non
co-operation by a rated entity may be a result of deterioration in
its credit risk profile. These ratings with 'ISSUER NOT
COOPERATING' suffix lack a forward looking component.'
Detailed Rationale
Despite repeated attempts to engage with the management, CRISIL
Ratings failed to receive any information on either the financial
performance or strategic intent of Shreemukh, which restricts
CRISIL Ratings' ability to take a forward looking view on the
entity's credit quality. CRISIL Ratings believes that rating action
on Shreemukh is consistent with 'Assessing Information Adequacy
Risk'. Based on the last available information, the ratings on bank
facilities of Shreemukh continues to be 'CRISIL B+/Stable Issuer
Not Cooperating'.
Shreemukh Builders, incorporated in 2005, undertakes real estate
development. It is part of Vasavi group which has been in the real
estate business in Hyderabad for over 25 years. The company is
implementing a residential project at Erragadda in Hyderabad.
SHRUTI TRAVELS: CRISIL Lowers Rating on INR2.7cr Loan to D
----------------------------------------------------------
CRISIL Ratings has downgraded the rating on the long term bank
facility of Shruti Travels (ST) to 'CRISIL D Issuer not
cooperating' from 'CRISIL BB-/Stable Issuer not cooperating', as
there are delays in repayment of term loan.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Proposed Working 2.7 CRISIL D (ISSUER NOT
Capital Facility COOPERATING; Downgraded
from 'CRISIL BB-/Stable
ISSUER NOT COOPERATING')
CRISIL Ratings has been consistently following up with ST for
obtaining information through letters and emails dated August 11,
2020 and August 15, 2020 among others, apart from telephonic
communication. However, the issuer has remained non cooperative.
'The investors, lenders and all other market participants should
exercise due caution with reference to the rating assigned/reviewed
with the suffix 'ISSUER NOT COOPERATING' as the rating is arrived
at without any management interaction and is based on best
available or limited or dated information on the company. Such non
co-operation by a rated entity may be a result of deterioration in
its credit risk profile. These ratings with 'ISSUER NOT
COOPERATING' suffix lack a forward looking component.'
Detailed Rationale
Despite repeated attempts to engage with the management, CRISIL
Ratings failed to receive any information on either the financial
performance or strategic intent of ST, which restricts CRISIL
Ratings' ability to take a forward looking view on the entity's
credit quality. CRISIL Ratings believes that rating action on ST is
consistent with 'Assessing Information Adequacy Risk'.
Based on the last available information, CRISIL Ratings has
downgraded the rating on the long term bank facility of ST to
'CRISIL D Issuer not cooperating' from 'CRISIL BB-/Stable Issuer
not cooperating', as there are delays in repayment of term loan.
ST was set up in 2000, in Indore, Madhya Pradesh, by Mr. Rajesh
Shrivastava. The firm is engaged in car rental business to
corporates.
SWAGAT FOOD: CRISIL Assigns B+ Rating to INR5cr Proposed Loan
-------------------------------------------------------------
CRISIL Ratings has assigned its 'CRISIL B+/Stable' rating to the
long-term bank facility of Swagat Food and Storage (SFS).
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Proposed Long Term
Bank Loan Facility 5 CRISIL B+/Stable (Assigned)
The rating reflects the exposure of SFS to risks related to
implementation of its ongoing project and an expected leveraged
financial risk profile. These weaknesses are partially offset by
the extensive experience of the partners in the hotel and allied
industry.
Key Rating Drivers & Detailed Description
Weaknesses
* Exposure to risks related to ongoing project: SFS is scheduled to
commence its project in October 2021; timely completion and
successful stabilisation of operations at the new unit will remain
key rating sensitivity factors. Further, demand risk is expected to
be moderate as the industry is highly fragmented owing to low entry
barriers with small capital and technological requirements. Intense
competition may continue to constrain scalability, pricing power
and profitability.
* Expected leveraged financial risk profile: Financial risk profile
should remain modest over the medium term as the project is
aggressively funded through a debt-equity ratio of 2.5 times.
Strength
* Extensive experience of partners: The partners have been in the
hotel and allied industry for over a decade. Their strong
understanding of market dynamics and healthy relationships with
suppliers and customers should continue to support the business.
Liquidity: Stretched
Cash accrual is projected at INR0.70-0.75 crore per annum over the
medium term, against yearly debt obligation of INR0.35 crore. The
partners are likely to extend timely, need-based funds to aid
financial flexibility.
Outlook: Stable
SFS will continue to benefit from the extensive experience of its
partners
Rating Sensitivity Factors
Upward factors
* Cash accrual increasing to more than INR1 crore per fiscal
* Quick ramp-up in production
Downward factors
* Interest coverage ratio declining to 1.5 times
* Significant delay in commencement of operations and substantial
cost overrun
SFS was set up in October 2020 as a partnership entity by Mr.
Anantkumar B Patel, Mr. Sailesh B Patel, Mr. Girish B Patel, Mr.
Hiren A Patel, Mr. Raj S Patel and Mr. Ashutosh G Patel. The firm
is based in Gandhinagar (Gujarat) and is setting up a ripening
facility for different types of fruits, vegetables and dairy
products; it will also be trading in these products. SFS is likely
to commence operations from October 2021.
TERRA DEVELOPERS: CRISIL Moves D Debt Rating to Not Cooperating
---------------------------------------------------------------
CRISIL Ratings has migrated the rating on bank facilities of Terra
Developers (TD) to 'CRISIL D Issuer not cooperating'.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Long Term Loan 20 CRISIL D (ISSUER NOT
COOPERATING; Rating Migrated)
CRISIL Ratings has been consistently following up with TD for
obtaining information through letters and emails dated March 31,
2021 and April 23, 2021 among others, apart from telephonic
communication. However, the issuer has remained non cooperative.
'The investors, lenders and all other market participants should
exercise due caution with reference to the rating assigned/reviewed
with the suffix 'ISSUER NOT COOPERATING' as the rating is arrived
at without any management interaction and is based on best
available or limited or dated information on the company. Such non
co-operation by a rated entity may be a result of deterioration in
its credit risk profile. These ratings with 'ISSUER NOT
COOPERATING' suffix lack a forward looking component.'
Detailed Rationale
Despite repeated attempts to engage with the management, CRISIL
Ratings failed to receive any information on either the financial
performance or strategic intent of TD, which restricts CRISIL
Ratings' ability to take a forward looking view on the entity's
credit quality. CRISIL Ratings believes that rating action on TD is
consistent with 'Assessing Information Adequacy Risk'. Therefore,
on account of inadequate information and lack of management
cooperation, CRISIL Ratings has migrated the rating on bank
facilities of TD to 'CRISIL D Issuer not cooperating'.
TD was formed as a partnership firm in 2013. The firm is currently
developing a residential project called 'Terra Heritage' at Bhiwadi
(Rajasthan).
TERRA REALCON: CRISIL Moves D Debt Rating to Not Cooperating
------------------------------------------------------------
CRISIL Ratings has migrated the rating on bank facilities of Terra
Realcon Private Limited (TRPL) to 'CRISIL D Issuer not
cooperating'.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Term Loan 10 CRISIL D (ISSUER NOT COOPERATING;
Rating Migrated)
CRISIL Ratings has been consistently following up with TRPL for
obtaining information through letters and emails dated March 31,
2021 and April 23, 2021 among others, apart from telephonic
communication. However, the issuer has remained non cooperative.
'The investors, lenders and all other market participants should
exercise due caution with reference to the rating assigned/reviewed
with the suffix 'ISSUER NOT COOPERATING' as the rating is arrived
at without any management interaction and is based on best
available or limited or dated information on the company. Such non
co-operation by a rated entity may be a result of deterioration in
its credit risk profile. These ratings with 'ISSUER NOT
COOPERATING' suffix lack a forward looking component.'
Detailed Rationale
Despite repeated attempts to engage with the management, CRISIL
Ratings failed to receive any information on either the financial
performance or strategic intent of TRPL, which restricts CRISIL
Ratings' ability to take a forward looking view on the entity's
credit quality. CRISIL Ratings believes that rating action on TRPL
is consistent with 'Assessing Information Adequacy Risk'.
Therefore, on account of inadequate information and lack of
management cooperation, CRISIL Ratings has migrated the rating on
bank facilities of TRPL to 'CRISIL D Issuer not cooperating'.
Incorporated in 2007 and promoted by Mr. Mahender Arora and Mr.
Sunil Chutani, TRPL develops real estate and is currently
constructing a residential project, Terra Castle, in Bhiwadi,
Rajasthan.
VASAVI AGRO: CRISIL Lowers Rating on INR21cr Loans to D
-------------------------------------------------------
CRISIL Ratings has revised the rating on the long term bank
facilities of Sri Vasavi Agro Foods (SVAF) to 'CRISIL D Issuer Not
Cooperating' from 'CRISIL B+/Stable Issuer Not Cooperating'.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Cash Credit 19 CRISIL D (ISSUER NOT COOPERATING;
Downgraded from 'CRISIL B+/Stable
ISSUER NOT COOPERATING')
Long Term Loan 2 CRISIL D (ISSUER NOT COOPERATING;
Downgraded from 'CRISIL B+/Stable
ISSUER NOT COOPERATING')
CRISIL Ratings has been consistently following up with SVAF for
obtaining information through emails dated July 25, 2020 and
January 19, 2021 among others; apart from telephonic communication.
However, the issuer has remained non-cooperative.
'The investors, lenders and all other market participants should
exercise due caution with reference to the rating assigned/reviewed
with the suffix 'ISSUER NOT COOPERATING' as the rating is arrived
at without any management interaction and is based on best
available or limited or dated information on the company. Such non
co-operation by a rated entity may be a result of deterioration in
its credit risk profile. These ratings with 'ISSUER NOT
COOPERATING' suffix lack a forward looking component.'
Detailed Rationale
Despite repeated attempts to engage with the management, CRISIL
Ratings failed to receive any information on either the financial
performance or strategic intent of SVAF, which restricts the
ability of CRISIL Ratings to take a forward-looking view on the
group's credit quality. CRISIL Ratings believe the rating action on
the group is consistent with 'Assessing Information Adequacy Risk'.
On account of irregularity in the company's account conduct (as per
banker feedback), characterised by delays in debt servicing for
more than 30 days and the ratings being marked non performing asset
(NPA), the rating on the long term bank facilities of SVAF has been
downgraded to 'CRISIL D Issuer Not Cooperating' from 'CRISIL
B+/Stable Issuer Not Cooperating'. Set up in fiscal 2013 as a
partnership firm, SVAF processes paddy into rice, rice bran, broken
rice, and husk; it commenced commercial production in December
2013. The rice mill is located at Karatagi in Koppal (Karnataka).
The operations are managed by the chief partner Mr. Y Vasudev
Shetty.
VENKATESH COTTON: CRISIL Lowers Rating on INR7.50cr Loan to B
-------------------------------------------------------------
CRISIL Ratings has revised the ratings on bank facilities of
Venkatesh Cotton Company (VCC) to 'CRISIL B/Stable/CRISIL A4 Issuer
Not Cooperating' from 'CRISIL BB-/Stable/CRISIL A4+ Issuer Not
Cooperating'.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Bank Guarantee 0.35 CRISIL A4 (ISSUER NOT
COOPERATING; Revised from
'CRISIL A4+ ISSUER NOT
COOPERATING*')
Cash Credit 7.50 CRISIL B/Stable (ISSUER NOT
COOPERATING; Revised from
'CRISIL BB-/Stable ISSUER
NOT COOPERATING')
Long Term Loan 1.80 CRISIL B/Stable (ISSUER NOT
COOPERATING; Revised from
'CRISIL BB-/Stable ISSUER
NOT COOPERATING')
Proposed Cash 1.55 CRISIL B/Stable (ISSUER NOT
Credit Limit COOPERATING; Revised from
'CRISIL BB-/Stable ISSUER
NOT COOPERATING')
CRISIL Ratings has been consistently following up with VCC for
obtaining information through letters and emails dated
November 21, 2020 and May 19, 2021 among others, apart from
telephonic communication. However, the issuer has remained non
cooperative.
'The investors, lenders and all other market participants should
exercise due caution with reference to the rating assigned/reviewed
with the suffix 'ISSUER NOT COOPERATING' as the rating is arrived
at without any management interaction and is based on best
available or limited or dated information on the company. Such non
co-operation by a rated entity may be a result of deterioration in
its credit risk profile. These ratings with 'ISSUER NOT
COOPERATING' suffix lack a forward looking component.'
Detailed Rationale
Despite repeated attempts to engage with the management, CRISIL
Ratings failed to receive any information on either the financial
performance or strategic intent of VCC, which restricts CRISIL
Ratings' ability to take a forward looking view on the entity's
credit quality. CRISIL Ratings believes that rating action on VCC
is consistent with 'Assessing Information Adequacy Risk'. Based on
the last available information, the ratings on bank facilities of
VCC revised to 'CRISIL B/Stable/CRISIL A4 Issuer Not Cooperating'
from 'CRISIL BB-/Stable/CRISIL A4+ Issuer Not Cooperating'.
VCC was set up in 2010 as a partnership between the families of Mr.
Avinash Biyani and Mr. Ashish Binayake along with Mr. Devanand
Dhoot. The Bhokar-based firm gins raw cotton and has processing
capacity of 1,300 quintal per day.
=========
J A P A N
=========
JAPAN: To Narrowly Avoid Double-Dip Recession, Survey Shows
-----------------------------------------------------------
Yuko Takeo at Bloomberg News reports that Japan's economy is likely
to eke out growth this quarter and narrowly avoid a double-dip
recession even though the country's battle to stamp out the
coronavirus is dragging on.
Gross domestic product is seen expanding an annualized 0.6% in the
three months through June, according to a Bloomberg survey of
economists published June 16. The pace is less than half that
projected last month, but the result suggests the recovery has
started to get back on track.
That's good news for the world's third-largest economy, which is
still struggling under a third declaration of emergency to contain
the virus that's only set to end June 20, Bloomberg says. Avoiding
a double-dip recession could also help Prime Minister Yoshihide
Suga, who faces elections that must be called by early fall.
Still, the survey showed economists now see private consumption
continuing to drop this quarter, while gains in business investment
are expected to be somewhat smaller than seen a month ago,
Bloomberg notes.
Looking further ahead, the economy is likely to benefit from a
vaccine drive that's sped up recently. Economist Harumi Taguchi at
IHS Markit said she expects vaccinations to start helping the
economy by the middle of the third quarter, by which time she
estimates 40% of the population will have gotten at least one shot,
Bloomberg relays.
=====================
N E W Z E A L A N D
=====================
MTF PANTERA 2021: Fitch Assigns Final B+ Rating to Class F Notes
----------------------------------------------------------------
Fitch Ratings has assigned final ratings to MTF Pantera Trust
2021's pass-through floating-rate notes. The issuance consists of
notes backed by a pool of first-ranking New Zealand automotive loan
receivables originated by Motor Trade Finance Limited (MTF). The
notes will be issued by Trustees Executors Limited as trustee for
MTF Pantera Trust 2021.
The final rating on the class C note is higher than the expected
rating, primarily due to the reduction in the transaction's
weighted-average (WA) note margin from the indicative WA margin
previously modelled, which increases the excess spread available to
cover losses.
The total collateral pool at the 8 June 2021 cut-off date was sized
at NZD277.2 million and consisted of 19,695 receivables with a WA
remaining term to maturity of 38 months.
DEBT RATING PRIOR
---- ------ -----
MTF Pantera Trust 2021
Class A NZPANTFAT019 LT AAAsf New Rating AAA(EXP)sf
Class B NZPANTFBT025 LT AAsf New Rating AA(EXP)sf
Class C NZPANTFCT031 LT A+sf New Rating A(EXP)sf
Class D NZPANTFDT047 LT BBB+sf New Rating BBB+(EXP)sf
Class E NZPANTFET052 LT BB+sf New Rating BB+(EXP)sf
Class F NZPANTFFT067 LT B+sf New Rating B+(EXP)sf
Seller LT NRsf New Rating NR(EXP)sf
KEY RATING DRIVERS
Stress Commensurate with Ratings: Fitch derived borrower
risk-tier-specific default base-case expectations using historical
loss data since 2007. Distinct gross default base cases and
multiples were set for high, medium and low risk-graded borrowers.
The base-case gross default rate is 2.9% with a base-case recovery
rate of 45% on a WA portfolio level. Default expectations are based
on an asset pool that Fitch stressed to portfolio parameters. These
are applicable during the transaction's initial two-year revolving
period.
Fitch expects loan performance to deteriorate in the near term due
to the impact of the coronavirus pandemic, but to continue to
support the Stable Outlook on the rated notes. Fitch forecasts New
Zealand's GDP growth to recover to 4.5% in 2021 and 3.6% in 2022;
while unemployment is expected to be at 4.8% and 4.4%,
respectively. This is supported by a low official cash rate of
0.25%.
Credit Enhancement Supports Ratings: Credit enhancement is provided
by note subordination and strong excess spread.
Structural Risk Addressed: Fitch evaluated structural risk by
reviewing transaction documentation and structural features. A
liquidity reserve - sized at 1% of the outstanding note balance -
and an excess-spread reserve that traps excess income during
deteriorating arrears performance support the rated notes.
Low Operational and Servicing Risk: All assets are originated by
MTF, a large motor-vehicle financier established in New Zealand in
1970. Fitch undertook an operational review and found that the
operations of the originator and servicer were consistent with
market standards for auto and equipment lenders in New Zealand. The
pandemic has not disrupted collection or servicing activity, as
staff are able to work remotely and have access to the office, if
needed.
No Residual Value Risk: There is no residual value exposure in this
transaction. However, there is a small exposure to balloon-payment
loans.
Rated Above Sovereign: Structured finance notes can be rated up to
six notches above New Zealand's Long-Term Local-Currency Issuer
Default Rating of 'AA+', supporting the 'AAAsf' rating on the class
A notes.
RATING SENSITIVITIES
Factors that could, individually or collectively, lead to positive
rating action/upgrade:
-- Macroeconomic conditions, loan performance and credit losses
that are better than Fitch's expectations or sufficient build
up of credit enhancement that would fully compensate for the
credit losses and cash flow stresses commensurate with higher
rating scenarios, all else being equal.
-- The class A notes are rated at 'AAAsf', which is the highest
level on Fitch's scale. The ratings cannot be upgraded.
-- Class B / C / D / E / F
-- Current rating: AAsf / A+sf / BBB+sf / BB+sf / B+ sf
-- Decrease defaults by 10%; increase recoveries by 10%: AA+sf /
AA-sf / Asf / BBB-sf / BBsf
Factors that could, individually or collectively, lead to negative
rating action/downgrade:
-- A longer pandemic than Fitch expects that leads to
deterioration in macroeconomic fundamentals and consumers'
financial position in New Zealand beyond Fitch's expectations.
Credit enhancement cannot compensate for the higher credit
losses and cash flow stresses, all else being equal.
Downgrade Sensitivity
-- Notes: A / B / C / D / E / F
-- Current rating: AAAsf / AAsf / A+sf / BBB+sf / BB+sf / B+sf
-- Defaults increase by 10%: AA+sf / AA-sf / Asf / BBB+sf / BB+sf
/ B+sf
-- Defaults increase by 25%: AAsf / A+sf / A-sf / BBBsf / BBsf /
Bsf
-- Defaults increase by 50%: AA-sf / Asf / BBB+sf / BBB-sf / BB
sf / less than Bsf
-- Recoveries decrease by 10%: AA+sf / AAsf / Asf / BBB+sf / BBsf
/ B+sf
-- Recoveries decrease by 25%: AA+sf / AA-sf / Asf / BBBsf / BBsf
/ Bsf
-- Recoveries decrease by 50%: AA+sf / AA-sf / A-sf / BBBsf / BB
sf / less than Bsf
-- Defaults increase by 10%/recoveries decrease by 10%: AA+sf /
AA-sf / Asf / BBBsf / BBsf / Bsf
-- Defaults increase by 25%/recoveries decrease by 25%: AA-sf /
A+sf / BBB+sf / BBB-sf / B+sf / less than Bsf
-- Defaults increase by 50%/recoveries decrease by 50%: Asf /
BBB+sf / BBB-sf / BBsf / less than Bsf / less than Bsf
Coronavirus Downside Scenario Sensitivity
Fitch's coronavirus downside scenario assumes that are emergence of
infections in major economies prolongs the health crisis and
confidence shock, prompting extensions or renewals of lockdown
measures and preventing a financial market recovery. Fitch tested
this scenario by a 2.00x increase in defaults combined with a 1.15x
increase at the 'AAAsf' level, which is scaled down with the lower
rating stresses, and a 0.77x decrease in recoveries combined with a
0.90x decrease at the 'AAAsf' level.
This results in a higher WA default base-case of 5.7% and a lower
recovery base-case of 34.8%. This compares with WA default and
recovery base-cases of 2.9% and 45.0%, respectively, in Fitch's
baseline analysis. The WA 'AAAsf' default multiple is reduced to
3.5x, compared with 5.7x, to reflect the higher degree of stress
already included in the base case, while the 'AAAsf' recovery
haircut is also reduced to 41.9%, from 50.0%.
Notes: A / B / C / D / E / F
Current rating: AAAsf / AAsf / A+sf / BBB+sf / BB+sf / B+sf
Downside scenario: AA-sf / Asf / BBBsf / BBsf / less than Bsf /
less than Bsf
BEST/WORST CASE RATING SCENARIO
International scale credit ratings of Structured Finance
transactions have a best-case rating upgrade scenario (defined as
the 99th percentile of rating transitions, measured in a positive
direction) of seven notches over a three-year rating horizon; and a
worst-case rating downgrade scenario (defined as the 99th
percentile of rating transitions, measured in a negative direction)
of seven notches over three years. The complete span of best- and
worst-case scenario credit ratings for all rating categories ranges
from 'AAAsf' to 'Dsf'. Best- and worst-case scenario credit ratings
are based on historical performance.
USE OF THIRD PARTY DUE DILIGENCE PURSUANT TO SEC RULE 17G -10
Form ABS Due Diligence-15E was not provided to, or reviewed by,
Fitch in relation to this rating action.
DATA ADEQUACY
Fitch reviewed a small targeted sample of MTF's origination files
and found the file information to be adequately consistent with the
originator's policies and practices and the other information
provided to the agency about the asset portfolio. Fitch sought a
third-party assessment of the asset portfolio information, but none
was available for this transaction.
Overall, Fitch believes the asset pool information relied upon for
its rating analysis according to its applicable rating
methodologies is adequately reliable.
ESG CONSIDERATIONS
Unless otherwise disclosed in this section, the highest level of
ESG credit relevance is a score of '3'. This means ESG issues are
credit-neutral or have only a minimal credit impact on the entity,
either due to their nature or the way in which they are being
managed by the entity.
=====================
P H I L I P P I N E S
=====================
R&L INVESTMENTS: SEC Cancels License Over Fraud; Slaps PHP25M Fine
------------------------------------------------------------------
A special hearing panel (SHP) at the Securities and Exchange
Commission (SEC) has revoked the license of R&L Investments, Inc.,
as well as disqualified its key officers and the owner of the
account used to siphon off client shares from the stock brokerage.
In addition, the SHP imposed monetary penalties totaling P25
million against the brokerage, its key officers and the client
involved in the fraudulent scheme that led to the collapse of one
of the country's oldest stock brokerages.
In a decision dated June 11, the SHP found R&L, along with its
president Joseph Lee, nominee and salesman Lucy Linda Lee, and
associated person Jonathan Lee, liable for the fraudulent transfer
of client shares to an account in another brokerage, Venture
Securities, Inc. (VSI).
In separate decisions issued on June 11, the SHP likewise found
Messrs. Marlo Moron and Julieto Sulapas liable for engaging in
fraudulent transactions, in violation of Republic Act No. 8799, or
The Securities Regulation Code (SRC), and its implementing rules
and regulations (IRR).
Mr. Moron facilitated the transactions as a trading floor assistant
and settlement clerk of R&L through EQ trades - the transfer of
shares between brokers - while, at the same time, representing Mr.
Sulapas in his transactions at VSI.
Documents submitted by R&L and VSI showed that a total of
PHP1,130,508,721.09 worth of client shares in R&L were transferred
to Mr. Sulapas' account in VSI through the EQ trades executed by
Mr. Moron from 2012 to 2019.
However, Mr. Sulapas' ledger in R&L revealed that no such shares
existed, and that the shares transferred to VSI actually came from
the accounts of other clients of R&L.
The scheme resulted in the loss of PHP700 million worth of client
shares in R&L and in the consequent deterioration of the
brokerage's financial condition, to the extent that it cannot
readily meet the demands of its clients for the delivery of
securities and/or payment of sales proceeds.
Investigation by the SEC Markets and Securities Regulation
Department (MSRD) revealed that Ms. Lee gave Mr. Moron the
necessary credentials to execute EQ trades.
Mr. Moron also received viewing access to R&L's back-office system.
As a result, he was able to access and acquire information
pertaining to the shareholdings of all R&L clients and to tamper
with the business partner portfolio reports to match the backoffice
records, thereby hiding the fraudulent scheme.
The SHP noted that Ms. Lee was the only registered salesman in R&L
and, thus, the only person allowed to access the order and trade
management tool provided by the Philippine Stock Exchange for use
by trading participants in executing trades and accessing market
data.
Mr. Jonathan Lee admitted to knowing the granting of the authority
to Mr. Moron, but did not take action on the matter.
Meanwhile, the SHP noted that Mr. Joseph Lee failed to perform his
duty as president of R&L, as he even admitted to having no
knowledge of the daily operations of the brokerage.
Accordingly, R&L violated SRC Rule 28.1.5, or the Registration of
Salesmen and Associated Persons of Brokers Dealers; Rule 30.2.1 or
the Ethical Standards Rules; Rule 30.2.1.2.3 or Capabilities; and
Rule 30.2.6 or Supervision.
The brokerage likewise violated Rule 30.2.1.2.4. Information About
Clients; Rule 34 or the Segregation and Limitation of Functions of
Members, Brokers and Dealers; Rule 52.1 or Accounts and Records,
Reports, Examination of Exchanges, Members, and Others; Rule 52.1.6
or the Customer Account Information Rule; and Rule 52.1.10 or the
Monthly Securities Counts by Brokers Dealers.
The SHP imposed monetary penalties amounting to PHP6 million each
for R&L, Mr. Joseph Lee and Mr. Jonathan Lee, and P4 million for
Ms. Lee. It also disqualified Messrs. Joseph Lee and Joseph Lee
from being registered persons, as well as from being an officer,
member of the board of directors, or person performing similar
functions for the latter.
In Mr. Moron's case, the SHP found that he engaged in the buying
and selling of securities without being registered or licensed as a
trader, aside from fraudulently transferring shares from R&L to VSI
using Mr. Sulapas' accounts.
"Thus, the Respondent should not get away from the consequences of
his intentional wrongful acts which resulted to the prejudice and
damage of R & L 's investors in the present case," the decision
read.
Meanwhile, the SHP found Mr. Sulapas to have violated Section 26 in
relation to Section 54 of the SRC and its IRR for his participation
in the fraudulent scheme.
"He allowed himself and his accounts in R&L and Venture Securities
to be used as a tool in the commission of the fraudulent scheme
that resulted in the loss of large number securities that belonged
to the clients of R&L," the SHP concluded.
The SHP imposed a PHP2 million monetary fine for Mr. Moron and PHP1
million for Mr. Sulapas. In addition, the panel disqualified
Messrs. Moron and Sulapas from being registered persons and
officers, directors, or persons performing similar functions.
In a separate decision issued on the same day but announced
earlier, the SHP likewise revoked the license of VSI and
disqualified its key officers from performing similar functions, on
top of the monetary fines totaling PHP32 million, for acts and
omissions that have indispensably contributed to the losses
incurred by R&L clients.
The decisions are without prejudice to any further action that the
MSRD Investigation and Review Committee may institute on the basis
of evidence that it may secure.
"We cannot tolerate and ignore any act or omission on the part of
those involved in the capital market which would violate the norm
set by the securities law especially on the transactions and
responsibilities of Broker Dealers and that would diminish or even
just tend to diminish the faith of the investors on the integrity
of the capital market," the SHP noted.
"[I]t is totally unacceptable and unconscionable to place the
Respondents' act and imprimatur on these issues that seriously
endanger the integrity of entire securities market. For this
Commission to cop-out and to close its eyes to these acts and
deeds, while convenient, would be to abandon its duty of
safeguarding public interest and the integrity of the capital
market."
===============
T H A I L A N D
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THAI AIRWAYS: Seeks THB25 Billion Loans to Finance Operations
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Bloomberg News reports that Thai Airways International is seeking
new loans to help fund operations after the court approved its plan
to restructure at least 170-billion-baht debt.
Bloomberg relates that the carrier has been in talks with some
banks for loans of as much as THB25 billion as part of the
debt-rehabilitation programme, chief financial officer Chai Eamsiri
told a video conference with reporters on June 9.
The Central Bankruptcy Court on June 14 endorsed the proposal,
which is backed by most creditors, the airline said.
"We would like to secure new loans as soon as possible because our
operating revenue can't cover the operating costs," Bloomberg
quotes Mr. Chai as saying. "Our existing cash and revenue now can
cover operations only through the end of this year."
The airline, whose biggest shareholder is the Finance Ministry, in
March proposed a three-year freeze on loan payments and a deferment
of bond repayments for six years, Bloomberg recalls.
To help it return to profitability - it posted a record loss of
THB141 billion last year - the carrier also plans to cut its
workforce by half, sell property and seek 50 billion baht in new
capital.
"All related parties should go ahead and help THAI succeed in its
rehabilitation plan," Prime Minister Prayut Chan-o-cha told a news
conference after a weekly cabinet meeting on June 15.
The approved debt plan includes some $7.4 billion in claims from
dozens of aircraft lessors and engine-service providers.
Bangkok-based Thai Air challenged that in March, saying it isn't
liable for because those claims involve future expenses and were
incurred after the airline received bankruptcy protection.
THAI has confidence in its ability to be profitable again once the
coronavirus pandemic passes, CEO Chansin Treenuchagron told a press
conference. Thailand is one of the top travel destinations in the
world and the carrier will be able to capitalise on this
popularity, he said, Bloomberg relays.
About Thai Airways
Thai Airways International PCL (BAK:THAI) --
http://www.thaiairways.co.th/-- is the national carrier of
Thailand. The company provides air transportation, freight and
mail services on domestic and international routes including Asia,
Europe, North America, Africa and South West Pacific. The Company
is a state enterprise which is controlled by the government and
partly owned by the public.
As reported in Troubled Company Reporter-Asia Pacific on May 21,
2020, Thailand's cabinet approved a plan to restructure troubled
Thai Airways International Pcl's finances through a bankruptcy
court, the Southeast Asian country's prime minister said on May 19,
2020.
The plan for a court-led restructuring of the national carrier
replaces a previous proposal of a government-backed rescue package
that was heavily criticised in the country.
Thai Airways on May 27, 2020 said it appointed board members as
rehabilitation planners in a bankruptcy court submission.
On Sept. 14, 2020, Thailand's Central Bankruptcy Court approved
Thai Airways debt restructuring.
In May 2021, Thai Airways' creditors approved the airline's debt
restructuring plan.
Thai Airways posted losses every year after 2012, except in 2016.
In 2019, it reported losses of THB12.04 billion.
The company's shareholders' equity turned negative at minus THB18.1
billion ($580 million) as of June. While its total liabilities
ballooned to THB332.1 billion, a 36.7% increase from the end of
2019, its cash and cash equivalents fell by 35.5% to THB13.9
billion, according to the Nikkei Asia.
*********
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 2021. All rights reserved. ISSN: 1520-9482.
This material is copyrighted and any commercial use, resale or
publication in any form (including e-mail forwarding,
electronic re-mailing and photocopying) is strictly prohibited
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Information contained herein is obtained from sources believed
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*** End of Transmission ***