/raid1/www/Hosts/bankrupt/TCRAP_Public/210819.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, August 19, 2021, Vol. 24, No. 160
Headlines
A U S T R A L I A
IN2FOOD AUSTRALIA: First Creditors' Meeting Set for Aug. 25
MALI NOMINEES: Second Creditors' Meeting Set for Aug. 24
MORTGAGE HOUSE 1: S&P Assigns Prelim. B Rating on F Notes
RBM BUSINESS: Second Creditors' Meeting Set for Aug. 26
SGB TRADING: Director Banned From Managing Companies for 5 Years
SYDNEY AIRPORT: Rejects Improved AUD22.80BB Buyout Bid
TG SHARE: First Creditors' Meeting Set for Aug. 25
UNIMONI PTY: Second Creditors' Meeting Set for Aug. 25
C H I N A
CHINA EVERGRANDE: Hui Ka Yan Steps Down as Chair of Property Unit
I N D I A
A. S. BETGERI: CRISIL Keeps B+ Debt Rating in Not Cooperating
A.M. FISHERIES: CRISIL Keeps B+ Debt Ratings in Not Cooperating
AARADHYA DISPOSAL: CRISIL Keeps B+ Ratings in Not Cooperating
ABDUL JALEEL: CRISIL Reaffirms B Rating on INR4cr Cash Loan
ANNAI INFRA: CRISIL Withdraws B Rating on INR169.18cr Loan
ASIAN VENTURES: CRISIL Withdraws B+ Rating on INR8.02cr Loan
ATHENA ENERGY: Insolvency Resolution Process Case Summary
AVANI DYECHEM: CRISIL Withdraws B Rating on INR4cr Cash Loan
DOLPHIN MARINE: Insolvency Resolution Process Case Summary
ELECTRONET EQUIPMENTS: CRISIL Reaffirms B Rating on INR7.8cr Loan
GKB OPHTHALMICS: CRISIL Lowers Rating on INR9.0cr Loan to D
HBS SEAVIEW PRIVATE: Insolvency Resolution Process Case Summary
HINDUSTAN DISTRIBUTOR: CRISIL Keeps B+ Rating in Not Cooperating
INTELLIGENT TEXTILE: Insolvency Resolution Process Case Summary
INTERCRAFT TRADING: CRISIL Keeps B+ Ratings in Not Cooperating
JAI HIND: CRISIL Keeps B+ Debt Ratings in Not Cooperating
JAI SAI RAM: Insolvency Resolution Process Case Summary
JANAKIRAMA RAW: CRISIL Keeps B+ Debt Rating in Not Cooperating
JCBL LTD: CRISIL Withdraws D Rating on INR29cr Cash Loan
KARANJA TERMINAL: CRISIL Migrates D Rating from Not Cooperating
KIRAN GLOBAL: Insolvency Resolution Process Case Summary
MANTENA LABORATORIES: Insolvency Resolution Process Case Summary
MECORDS INDIA: CRISIL Reaffirms B+ Rating on INR43.43 Cash Loan
MONARCH MULTILAYERS: Insolvency Resolution Process Case Summary
NEEL MOTORS: Insolvency Resolution Process Case Summary
NEXUS FEEDS: Insolvency Resolution Process Case Summary
NIMBUS HARBOR: CRISIL Withdraws B Rating on INR3cr Cash Credit
NISHA ENTERPRISES: CRISIL Keeps B+ Debt Rating in Not Cooperating
OPAL LUXURY: Insolvency Resolution Process Case Summary
PACIFIC SHARES: Insolvency Resolution Process Case Summary
PRATISHTHA DAIRY: Insolvency Resolution Process Case Summary
PRIMUSS PIPES: Insolvency Resolution Process Case Summary
RAJDEEP BUILDCON: CRISIL Lowers Rating on INR310.35cr Loan to D
RAJHANS INDUSTRIES: Insolvency Resolution Process Case Summary
RAMJI ACRO: CRISIL Keeps B+ Debt Ratings in Not Cooperating
RANSAN PACKAGING: CRISIL Lowers Rating on INR5.1cr Loan to D
RSI GROUP: CRISIL Keeps B+ Debt Ratings in Not Cooperating
SATYALAKSHMI RICE: CRISIL Keeps B+ Ratings in Not Cooperating
SESHASAI SPINNING: CRISIL Keeps B+ Ratings in Not Cooperating
SHRIDHAR STEELS: Insolvency Resolution Process Case Summary
SHRISHTI ELECTROMECH: CRISIL Keeps B+ Ratings in Not Cooperating
SIVA INDUSTRIES: NCLT Rejects ‘Business Restructuring Plan'
SKV INFRATECH: CRISIL Withdraws B Rating on INR4cr Cash Loan
SPM WEAVING: CRISIL Withdraws B Rating on INR12cr Loans
TOUGH BAGS: CRISIL Lowers Rating on INR7cr Cash Loan to D
I N D O N E S I A
PT BAYAN RESOURCES: S&P Alters Outlook on 'B+' ICR to Positive
N E W Z E A L A N D
AVANTI RMBS 2021-1: Fitch Assigns BB+ Rating on Class E Notes
S I N G A P O R E
ENVY GLOBAL: Court Orders 3 Firms Linked to Fraud Scheme Wound Up
SINOPIPE HOLDINGS: KordaMentha Appointed as Liquidators
SKIRNER PTE: Creditors' Proofs of Debt Due on Sept. 17
T H A I L A N D
THAI AIRWAYS: Posts THB11.1 Billion Net Loss at 1st Half 2021
V I E T N A M
DAT XANH GROUP: Moody's Assigns First Time B2 Corp. Family Rating
- - - - -
=================
A U S T R A L I A
=================
IN2FOOD AUSTRALIA: First Creditors' Meeting Set for Aug. 25
-----------------------------------------------------------
A first meeting of the creditors in the proceedings of:
- In2food Australia Pty Ltd
- In2f Services Pty Ltd
- In2food Perth Pty Ltd
- Inspired Food Solutions Pty Ltd
- Middle Road Investments Pty Ltd
- Yarra Valley Farms Australia Pty Ltd
- Yarra Valley Farms IP Pty Ltd
will be held on Aug. 25, 2021, at 11:00 a.m. via videoconference.
Jason Tracy and Salvatore Algeri of Deloitte were appointed as
administrators of In2food Australia et al. on Aug. 13, 2021.
MALI NOMINEES: Second Creditors' Meeting Set for Aug. 24
--------------------------------------------------------
A second meeting of creditors in the proceedings of Mali Nominees
Pty Ltd ATF Rita Kohu Family Trust Trading as Alphington Aged
Care/Chronos Care Alphington and Mt Eliza Aged Care Pty Ltd Trading
as Ranelagh Gardens/Chronos Care Mt Eliza has been set for Aug. 24,
2021, at 10:00 a.m. via electronic means.
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 Aug. 23, 2021, at 12:00 p.m.
Stephen John Michell of PCI Partners Pty Ltd was appointed as
administrator of Mali Nominees on July 30, 2021.
MORTGAGE HOUSE 1: S&P Assigns Prelim. B Rating on F Notes
---------------------------------------------------------
S&P Global Ratings assigned its preliminary ratings to eight
classes of prime residential mortgage-backed securities (RMBS) to
be issued by Perpetual Trustee Co. Ltd. as trustee for Mortgage
House Capital Mortgage Trust No.1 - Mortgage House RMBS Series
2021-2. Mortgage House RMBS Series 2021-2 is a securitization of
residential mortgages originated by Mortgage House of Australia Pty
Ltd.
The preliminary ratings reflect:
-- S&P's view of the credit risk of the underlying collateral
portfolio, including its view that the credit support provided to
each class of notes is commensurate with the ratings assigned.
Credit support for the rated notes comprises note subordination,
lenders' mortgage insurance (LMI) on 6.2% of the loans in the
portfolio, and excess spread.
-- The underwriting standard and centralized approval process of
the seller, Mortgage House of Australia.
-- S&P's expectation that the various mechanisms to support
liquidity within the transaction, including a liquidity facility
equal to 1.2% of the outstanding balance of the notes, principal
draws, and a loss reserve that builds from excess spread, are
sufficient under its stress assumptions.
-- The benefit of a fixed- to floating-rate interest-rate swap
provided by Westpac Banking Corp. to hedge the mismatch between
receipts from any fixed-rate mortgage loans and the variable-rate
RMBS.
Preliminary Ratings Assigned
Mortgage House Capital Mortgage Trust No.1 - Mortgage House RMBS
Series 2021-2
Class A1, A$425.0 million: AAA (sf)
Class A2, A$35.0 million: AAA (sf)
Class AB, A$8.25 million: AAA (sf)
Class B, A$10.5 million: AA (sf)
Class C, A$8.75 million: A (sf)
Class D, A$5.50 million: BBB (sf)
Class E, A$3.25 million: BB (sf)
Class F, A$2.0 million: B (sf)
Class G, A$1.75 million: Not rated
RBM BUSINESS: Second Creditors' Meeting Set for Aug. 26
-------------------------------------------------------
A second meeting of creditors in the proceedings of RBM Business
Pty Ltd has been set for Aug. 26, 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 Aug. 25, 2021, at 12:00 p.m.
Jarvis Lee Archer of Revive Financial was appointed as
administrator of RBM Business on July 23, 2021.
SGB TRADING: Director Banned From Managing Companies for 5 Years
----------------------------------------------------------------
Duncan McLeod of Blacktown, NSW, has been disqualified from
managing companies for five years for his involvement in the
failure of two companies.
Mr. McLeod was a director of two companies that went into
liquidation between November 2016 and February 2019, namely:
SGB Trading Pty Ltd (A.C.N. 166 030 306) (SGB Trading); and RC
Detailed Joinery Pty Ltd (A.C.N. 147 009 390) (RC Joinery).
SGB Trading operated as an importer and wholesaler of solar power
products. RC Joinery traded as a kitchen joinery business.
In making its decision to disqualify Mr. McLeod, ASIC found that
he:
* failed to ensure SGB Trading and RC Joinery complied with
their statutory obligations and pay tax liabilities;
* failed to keep written financial records that explain its
transactions and financial position and performance for reporting
and audit purposes;
* failed to provide the liquidator of SGB Trading with the
company's books and records;
* allowed SGB Trading to incur debts when there were reasonable
grounds to suspect it was not in a position to pay them;
* failed to prevent SGB Trading from incurring debts when it was
insolvent;
* used his position as the director of RC Joinery to gain an
advantage for the previous director, or cause detriment to the
company;
* failed in his duty as the sole director of RC Joinery from 30
September 2014 to monitor the company's transactions and to control
its bank accounts; and
* transferred RC Joinery's business to United Joinery Pty Ltd
A.C.N 615 437 664 to enable its business to continue unburdened by
debt – a practice commonly known as illegal phoenix activity.
The total amount owed to creditors of the two companies was
AUD1,073,227.000.
In deciding to disqualify Mr. McLeod, ASIC relied on supplementary
reports lodged by the liquidators of SGB Trading, Clifford
Sanderson of Dissolve, and the liquidator of RC Joinery, Neil
Cussen of Deloitte. ASIC assisted both liquidators to prepare
supplementary reports by providing funding from the Assetless
Administration Fund.
Mr. McLeod is disqualified from managing corporations until Aug. 3,
2026.
SYDNEY AIRPORT: Rejects Improved AUD22.80BB Buyout Bid
------------------------------------------------------
Reuters reports that Sydney Airport Holdings Pty Ltd on Aug. 16
rejected an improved AUD22.80 billion (US$16.81 billion) bid from a
group of infrastructure investors, saying that it undervalued the
airport operator, but that it was open to a higher offer.
Reuters relates that the new offer valued Sydney Airport at AUD8.45
per share, 2.4% higher than the previous offer of AUD8.25 a share,
and a more than 9% premium to the stock's Aug. 16 close.
According to Reuters, a successful takeover would be among the
largest buyouts ever of an Australian firm and underline a year of
stellar deal activity, that has already seen a mega $29 billion
buyout of Afterpay by Square.
But it would require Sydney Airport to allow due diligence as well
as receiving approvals from shareholders, the competition regulator
and the Foreign Investment Review Board, a process that typically
takes months.
Reuters says the unanimous board rejection comes a month after the
airport operator turned down an initial bid from the Sydney
Aviation Alliance (SAA), a consortium of Australian investors IFM
Investors and QSuper and U.S.-based Global Infrastructure Partners.
read more
Record-low interest rates have prompted pension funds and their
investment managers to chase higher yields.
Australia's largest pension fund, AustralianSuper, has joined the
consortium, Sydney Airport said, in a move that could make it
tougher for a rival offer to emerge given the requirement for 51%
Australian control of the airport.
UniSuper, Sydney Airport's biggest shareholder with a 15.3% stake,
has indicated it is open to rolling that equity into an investment
in the privatised company, as required as part of the bid
conditions.
According to Reuters, Sydney Airport said its board was open to
engaging with the Sydney Aviation Alliance if the consortium lifts
its indicative price "to appropriately recognise long term value
for Sydney Airport securityholders."
Reuters relates that SAA said in a statement that given Sydney
Airport's lack of engagement and immediate rejection of the revised
proposal it appeared unlikely that the parties could agree on a
path forward, so there was no assurance a deal would be completed.
"The critical thing is they (SAA) haven't used 'final' and they
haven't walked away, so they continue to engage with each other,"
Reuters quotes Macquarie research analyst Ian Myles as saying.
Reuters adds that Macquarie's analysts said that given the high
value of the property within Sydney Airport and low interest rates,
a valuation of AUD8.75 was obtainable.
Sydney Airport is Australia's only listed airport operator and a
purchase would be a long-term bet on the travel sector which has
been battered by the pandemic, Reuters notes.
Sydney Airport is due to report its first-half financial results on
Aug. 20.
Sydney Airport Limited owns Sydney Airport. The company provides
international and domestic passenger services. It also offers
aeronautical services, including access to terminals,
infrastructure, apron parking, and airfield and terminal
facilities, as well as government mandated security services for
airlines; and parking and ground transport services, as well as
leases commercial space to tenants whose activities comprise duty
free, food and beverage, financial, and advertising services. In
addition, the company is involved in the leasing of terminal space,
buildings, and other space in the Sydney Airport; and rental of
cars.
TG SHARE: First Creditors' Meeting Set for Aug. 25
--------------------------------------------------
A first meeting of the creditors in the proceedings of:
- TG Share Investments Pty Ltd ATF Hopetoun Family Trust
- Myrtle Blossom Pty Ltd ATF Myrtle Road Trust
- Grangekew Pty Ltd ATF UTG Share Trust
- UDT Enterprises Pty Ltd ATF Cosmic Commercial Trading Trust
- Prabhat Pty Ltd ATF Goenka Family Trust
- GAD Investment Holdings Pty Ltd
will be held on Aug. 25, 2021, at 10:30 a.m. via
teleconference/online video conference.
Shane Justin Cremin of Rodgers Reidy was appointed as administrator
of TG Share Investments et al. on Aug. 13, 2021.
UNIMONI PTY: Second Creditors' Meeting Set for Aug. 25
------------------------------------------------------
A second meeting of creditors in the proceedings of Unimoni Pty Ltd
has been set for Aug. 25, 2021, at 2:00 p.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 Aug. 24, 2021, at 4:00 p.m.
Shaun Robert Fraser and Jason Craig Ireland of McGrathNicol were
appointed as administrators of Unimoni Pty on July 21, 2021.
=========
C H I N A
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CHINA EVERGRANDE: Hui Ka Yan Steps Down as Chair of Property Unit
-----------------------------------------------------------------
The Wall Street Journal reports that Chinese real-estate
billionaire Hui Ka Yan has stepped down as chairman of China
Evergrande Group's flagship property business, months after the
unit dropped plans for a multibillion-dollar listing on the
mainland.
The chairman of Hengda Real Estate, the main onshore subsidiary of
Hong Kong-listed Evergrande, is now Zhao Changlong, commerce
registration information on Chinese database provider qcc.com
showed on Aug. 17, the Journal relates. It is unclear exactly when
the change happened.
The Journal relates that Mr. Zhao, a former director of Hengda who
previously served as its chairman until August 2017, has also taken
over as the company's general manager and legal representative,
replacing Ke Peng.
An Evergrande spokesman confirmed the moves, describing them as
"normal changes" after Evergrande terminated its plan to list
Hengda in late 2020. He said they would have no impact on the
companies' management and shareholding structure.
Mr. Hui, a rags-to-riches tycoon who is now one of China's richest
men, is still chairman of the overall group, which owns 63% of
Hengda, the Journal notes.
About China Evergrande
China Evergrande Group is an integrated residential property
developer. The Company, through its subsidiaries, operates in
property development, investment, management, finance, internet,
health, culture, and tourism markets.
As reported in the Troubled Company Reporter-Asia Pacific on Aug.
9, 2021, S&P Global Ratings, on Aug. 5, 2021, downgraded China
Evergrande Group and its subsidiaries Hengda Real Estate Group Co.
Ltd. and Tianji Holding Ltd. to 'CCC' from 'B-'. S&P also lowered
its long-term issue rating on the U.S. dollar notes issued by
Evergrande and guaranteed by Tianji to 'CCC-' from 'CCC+'.
The negative outlook reflects Evergrande's increasing strained
liquidity and nonpayment risk. It also reflects S&P's view that its
asset disposal plan, though potentially substantial, lacks
visibility or certainty.
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I N D I A
=========
A. S. BETGERI: CRISIL Keeps B+ Debt Rating in Not Cooperating
-------------------------------------------------------------
CRISIL Ratings said the ratings on bank facilities of A. S. Betgeri
(ASB) continue to be 'CRISIL B+/Stable/CRISIL A4 Issuer Not
Cooperating'.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Bank Guarantee 5 CRISIL A4 (Issuer Not
Cooperating)
Cash Credit 3 CRISIL B+/Stable (Issuer Not
Cooperating)
CRISIL Ratings has been consistently following up with ASB for
obtaining information through letters and emails dated January 26,
2021 and July 9, 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 ASB, which restricts CRISIL
Ratings' ability to take a forward looking view on the entity's
credit quality. CRISIL Ratings believes that rating action on ASB
is consistent with 'Assessing Information Adequacy Risk'. Based on
the last available information, the ratings on bank facilities of
ASB continues to be 'CRISIL B+/Stable/CRISIL A4 Issuer Not
Cooperating'.
Set up in 1995 by Mr. A S Betgeri as a proprietorship firm, ASB
undertakes civil construction works of buildings primarily for the
Karnataka Public Works Department.
A.M. FISHERIES: CRISIL Keeps B+ Debt Ratings in Not Cooperating
---------------------------------------------------------------
CRISIL Ratings said the ratings on bank facilities of A.M.
Fisheries (AMF) continue to be 'CRISIL B+/Stable/CRISIL A4 Issuer
Not Cooperating'.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Bill Discounting 1 CRISIL A4 (Issuer Not
Cooperating)
Bill Discounting 10 CRISIL A4 (Issuer Not
under Letter Cooperating)
of Credit
Long Term Loan 1.8 CRISIL B+/Stable (Issuer Not
Cooperating)
Packing Credit 10 CRISIL A4 (Issuer Not
Cooperating)
Proposed Long Term 1.2 CRISIL B+/Stable (Issuer Not
Bank Loan Facility Cooperating)
CRISIL Ratings has been consistently following up with AMF for
obtaining information through letters and emails dated January 26,
2021 and July 9, 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 AMF, which restricts CRISIL
Ratings' ability to take a forward looking view on the entity's
credit quality. CRISIL Ratings believes that rating action on AMF
is consistent with 'Assessing Information Adequacy Risk'. Based on
the last available information, the ratings on bank facilities of
AMF continues to be 'CRISIL B+/Stable/CRISIL A4 Issuer Not
Cooperating'.
AMF, a partnership firm, was set up in 2010 by Mr. A Mustaffa and
his family in Kerala. The firm exports seafood, mainly cuttlefish,
octopus, and squid. Mr. M Nizam, son of Mr. A Mustaffa, is the
firm's managing partner.
Established in 2010 as a partnership firm by the promoters of AMF
in Kerala, PMF exports seafood, mainly cuttlefish, octopus, and
squid.
AARADHYA DISPOSAL: CRISIL Keeps B+ Ratings in Not Cooperating
-------------------------------------------------------------
CRISIL Ratings said the ratings on bank facilities of Aaradhya
Disposal Industries Private Limited (ADIIL) continue to be 'CRISIL
B+/Stable Issuer Not Cooperating'.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Cash Credit 3.25 CRISIL B+/Stable (Issuer Not
Cooperating)
Term Loan 7.75 CRISIL B+/Stable (Issuer Not
Cooperating)
CRISIL Ratings has been consistently following up with ADIIL for
obtaining information through letters and emails dated January 26,
2021 and July 9, 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 ADIIL, which restricts CRISIL
Ratings' ability to take a forward looking view on the entity's
credit quality. CRISIL Ratings believes that rating action on ADIIL
is consistent with 'Assessing Information Adequacy Risk'. Based on
the last available information, the ratings on bank facilities of
ADIIL continues to be 'CRISIL B+/Stable Issuer Not Cooperating'.
ADIIL was previously set up as a partnership firm in 2013 (refers
to calendar year, January 1 to December 31) and was reconstituted
with its current name in 2015. It manufactures paper cups, paper
cup blank and paper cup bottom roll. The manufacturing facility is
located in Dewas, Madhya Pradesh. The company is promoted by Mr.
Sunil Maheshwari and Mr. Anil Maheshwari.
ABDUL JALEEL: CRISIL Reaffirms B Rating on INR4cr Cash Loan
-----------------------------------------------------------
CRISIL Ratings has reaffirmed its 'CRISIL B/Stable/CRISIL A4'
ratings on the bank facilities of Abdul Jaleel MM (AJ).
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Bank Guarantee 2 CRISIL A4 (Reaffirmed)
Cash Credit 4 CRISIL B/Stable (Reaffirmed)
Long Term Loan 1.4 CRISIL B/Stable (Reaffirmed)
Proposed Long Term
Bank Loan Facility 2.6 CRISIL B/Stable (Reaffirmed)
The ratings continue to reflect the firm's modest scale of
operations in the highly fragmented construction industry, limited
scale of operations owing to presence in a single state and a
below-average financial risk profile. These rating weaknesses are
partially offset by the long-standing industry experience of its
promoter.
Key Rating Drivers & Detailed Description
Weaknesses:
* Modest scale of operations in a highly fragmented industry: AJ's
scale of operations is modest, as reflected in its revenues of
around INR3 crores in fiscal 2021. This is due to tender-based
nature of operations. This also results in volatility in revenue
profile and also makes the firm susceptible to volatility in
operating margins as the same vary across various tenders.
Furthermore, the civil construction industry is highly fragmented
and marked by low entry barriers, due to which AJ faces intense
competition from other players. CRISIL Ratings believes that the
modest scale of its operations will continue to impinge on the
credit profile of AJ.
* Limited scalability owing to presence in a single state: The firm
undertakes all of its projects in Kerala, limiting the scale of
operations to new projects across a limited geography. Any events
such as slowdown in the infrastructure spending in Kerala or
operational delays may affect the flow of orders for the firm and
thus impact its revenue growth. The operations of AJ shall remain
constrained owing to its presence in a single state.
* Below-average financial risk profile: AJ's financial risk profile
is marked by a small net worth, of around INR4.3 crores for fiscal
2021. Moreover, the capital structure of the firm exhibits moderate
level of gearing, as marked by total outside liabilities to
tangible net worth (TOLTNW) ratio at 2.5 times as on March 31,
2021. Debt protection metrics is average with interest coverage
ratio of less than 2 times and net cash accruals to total debt
(NCATD) of 5% for fiscal 2021, the firm's debt protection metrics
remain average. CRISIL Ratings believes that AJ's financial risk
profile shall continue to remain below-average in the medium term.
Strength:
* Promoter's long-standing experience in the civil construction
industry: Mr. Abdul Jaleel MM has more than three decades of
experience in the civil construction industry. The promoter's
extensive industry experience has helped AJ bag projects frequently
from PWD. CRISIL Ratings believes that AJ shall continue to benefit
over the medium term from its promoter's extensive industry
experience and its strong revenue visibility.
Liquidity: Stretched
Bank limit utilization is high at around 96.95 percent for the past
twelve months ended June 2021. Cash accrual are expected to be over
INR0.3 crores which are sufficient against term debt obligation of
INR0.2 crores over the medium term. In addition, it will be act as
cushion to the liquidity of the company. Current ratio are moderate
at 1.25 times on March 31, 2021.
Outlook Stable
CRISIL Ratings believes that AJ will benefit over the medium term
from the experience of its promoters in civil construction
industry.
Rating Sensitivity factors
Upward factor
* Sustained improvement in scale of operation and order book of
more than INR10 crores
* Improvement in working capital cycle with GCA days of less than
200 days
Downward factor
* Decline in scale of operation or operating margin of less than
8%
* Stretch in working capital cycle resulting in full bank limit
utilization
AJ is a proprietorship firm involved in civil construction works
such as construction of roads, bridges and construction and
maintenance for irrigation facilities in Kerala. The firm is
managed by Mr. Abdul Jaleel MM.
ANNAI INFRA: CRISIL Withdraws B Rating on INR169.18cr Loan
----------------------------------------------------------
CRISIL Ratings has reaffirmed its ratings on the bank facilities
Annai Infra Developers Limited (AIDL) and simultaneously withdrawn
the ratings at the company's request and on receipt of a 'No
Objection Certificate' from the banker. The withdrawal is in line
with CRISIL Ratings' policy on withdrawal of bank loan ratings.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Bank Guarantee 169.18 CRISIL A4 (Rating Reaffirmed
and Withdrawn)
Cash Credit 60.82 CRISIL B/Stable (Rating
Reaffirmed and Withdrawn)
Proposed Cash 51.00 CRISIL B/Stable (Rating
Credit Limit Reaffirmed and Withdrawn)
Established in 2008, AIDL is an Erode-based Class 1 civil
contractor. The company primarily undertakes projects related to
water supply, irrigation, and drainage. Day-to-day operations are
managed by Mr. S Ashok Kumar.
ASIAN VENTURES: CRISIL Withdraws B+ Rating on INR8.02cr Loan
------------------------------------------------------------
Due to inadequate information, CRISIL Ratings, in line with SEBI
guidelines, had migrated the rating of Asian Ventures (AV) to
'CRISIL B+/Stable Issuer not cooperating'. CRISIL Ratings has
withdrawn its rating on bank facility of AV following a request
from the company and on receipt of a 'no dues certificate' from the
banker. Consequently, CRISIL Ratings is migrating the ratings on
bank facilities of AV from ' CRISIL B+/Stable Issuer Not
Cooperating to 'CRISIL B+/Stable'. The rating action is in line
with CRISIL Ratings' policy on withdrawal of bank loan ratings.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Term Loan 8.02 CRISIL B+/Stable (Migrated
from 'CRISIL B+/Stable ISSUER
NOT COOPERATING'; Rating
Withdrawn)
AV, incorporated in 2011 is engaged in real estate business. Asian
is a Joint Venture between Khurana family (40%) and Bobinmaker
family (60%). Currently, the firm is developing one residential
project in Pune, Maharashtra.
ATHENA ENERGY: Insolvency Resolution Process Case Summary
---------------------------------------------------------
Debtor: Athena Energy Ventures Private Limited
Front Side, Third Floor
Part of Property No. E-561, 561-A
G.R. Plaza, Palam
Sector-7, Dwarka
New Delhi Southwest
Delhi 110075
Insolvency Commencement Date: April 16, 2021
Court: National Company Law Tribunal, Bangalore Bench
Estimated date of closure of
insolvency resolution process: October 12, 2021
(180 days from commencement)
Insolvency professional: Mr. Kumar Rajan
Interim Resolution
Professional: Mr. Kumar Rajan
Flat No. 702
Wing 3 Ahad Euphria
Sarajapur Main Road
Chikkanalli, Bangalore
Karnataka 560035
E-mail: kumar.rajan1958@gmail.com
- and -
607, 6th Floor, Shangrila Plaza
Road No. 2, Opposite KBR Park
Banjara Hills, Hyderabad 500034
E-mail: cirp.aevpl@rbsa.in
Last date for
submission of claims: August 25, 2021
AVANI DYECHEM: CRISIL Withdraws B Rating on INR4cr Cash Loan
------------------------------------------------------------
CRISIL Ratings has withdrawn its rating on the bank facilities of
Avani Dyechem Industries (ADCI) on the request of the company and
after receiving no objection certificate from the bank. The rating
action is in-line with CRISIL Rating's policy on withdrawal of its
rating on bank loan facilities.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Bank Guarantee 0.02 CRISIL A4 (ISSUER NOT
COOPERATING; Rating
Withdrawn)
Cash Credit 4.00 CRISIL B/Stable (ISSUER NOT
COOPERATING; Rating
Withdrawn)
Foreign Discounting 1.00 CRISIL A4 (ISSUER NOT
Bill Purchase COOPERATING; Rating
Withdrawn)
Inland/Import 0.65 CRISIL A4 (ISSUER NOT
Letter of Credit COOPERATING; Rating
Withdrawn)
Long Term Loan 0.48 CRISIL B/Stable (ISSUER NOT
COOPERATING; Rating
Withdrawn)
CRISIL Ratings has been consistently following up with ADCI for
obtaining information through letters and emails dated May 23, 2020
and November 14, 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 ADCI. This restricts CRISIL
Ratings' ability to take a forward looking view on the credit
quality of the entity. CRISIL Ratings believes that rating action
on ADCI is consistent with 'Assessing Information Adequacy Risk'.
CRISIL Ratings has Continues the ratings on the bank facilities of
ADCI to 'CRISIL B/Stable/CRISIL A4 Issuer not cooperating'.
Set up as a proprietorship concern by Mr. Yogesh Dashrathlal
Parikh, ADCI manufactures synthetic organic dyes in powder form
that are used for garments.
DOLPHIN MARINE: Insolvency Resolution Process Case Summary
----------------------------------------------------------
Debtor: Dolphin Marine Foods and Processors (India)
Private Limited
Plot No. M-13, MIDC Taloja
Taluka: Panvel, Distt: Raigad
Maharashtra 410208
Insolvency Commencement Date: August 3, 2021
Court: National Company Law Tribunal, Mumbai Bench
Estimated date of closure of
insolvency resolution process: January 30, 2022
Insolvency professional: Mahesh Chand Gupta
Interim Resolution
Professional: Mahesh Chand Gupta
FE-202, Salt Lake City
1st Floor, Sector-III
Kolkata 700106
E-mail: mcgupta90@gmail.com
- and -
905, Crescent Royale
Veera Desai Road
Off New Link Road
Near Maurya Landmark
Andheri (W)
Mumbai 400053
E-mail: cirp.dolphin@gmail.com
Last date for
submission of claims: August 25, 2021
ELECTRONET EQUIPMENTS: CRISIL Reaffirms B Rating on INR7.8cr Loan
-----------------------------------------------------------------
CRISIL Ratings has reaffirmed its 'CRISIL B/Stable/CRISIL A4'
ratings on the bank facilities of Electronet Equipments Private
Limited (EEPL).
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Bank Guarantee 4.2 CRISIL A4 (Reaffirmed)
Cash Credit 4.0 CRISIL B/Stable (Reaffirmed)
Long Term Loan 7.8 CRISIL B/Stable (Reaffirmed)
The ratings continue to reflect the company's modest scale of
operations, large working capital requirement and subdued financial
risk profile. These weaknesses are partially offset by the
extensive experience of the promoter in the process control and
automation instruments business and the company's healthy
clientele.
EEPL had applied for restructuring of its debt in February 2021,
which was approved by the bank in March 2021. As per the
restructuring plan, part of the working capital limit was carved
out into a working capital term loan (WCTL). Furthermore, the
company has been sanctioned a moratorium on interest and repayment
on term loans and WCTL until December 2021. The debt restructuring
was aimed at supporting liquidity in light of business uncertainty
amid the Covid-19 pandemic.
Analytical Approach:
Unsecured loans of INR1.7 crore as on March 31, 2021 have been
treated as debt.
Key Rating Drivers & Detailed Description
Weaknesses:
* Modest scale of operations: The modest scale of operations is
reflected in estimated operating income of INR20 crore in fiscal
2021. Revenue growth has been modest in the past as well.
Furthermore, performance was impacted during the second wave of the
Covid-19 pandemic. Recovery and growth in revenue remain critical
and will be closely monitored.
* Subdued financial risk profile: Networth was modest and gearing
high at INR3.1 crore and 4.92 times, respectively, as on March 31,
2020. Debt protection metrics were subdued, indicated by net cash
accrual to total debt and interest coverage ratios of 0.07 time and
1.37 times, respectively, in fiscal 2020. The financial metrics are
estimated to remain at similar levels in fiscal 2021.
* Large working capital requirement: Gross current assets were
sizeable at 398 days as on March 31, 2020, driven by large
inventory and sizeable receivables of 270 and 128 days,
respectively. Bank debt and significant payables partially support
the working capital.
Strength:
* Extensive experience of the promoter and healthy clientele: The
near two-decade-long presence of the promoter, his sound
understanding of the market dynamics and healthy relationships with
suppliers and customers will continue to support the business. The
promoter should continue to provide need-based unsecured loans.
Liquidity: Stretched
Liquidity is stretched marked by the fully utilised bank limit in
the 12 months through April 2021, tightly matched accrual against
repayment obligations, but is supported by unsecured loans from the
promoter. Debt restructuring and moratorium on debt servicing have
partly supported the liquidity in near term.
Outlook: Stable
EEPL will continue to benefit from the promoter's extensive
experience.
Rating Sensitivity factors
Upward factors
* Healthy revenue growth and stable operating margin leading to
cash accrual of over INR2.5 crore
* Efficient working capital management and healthy capital
structure
Downward factors
* Decline in revenue or operating margin leading to cash accrual of
less than INR1.2 crore
* Stretch in the working capital cycle weakening the capital
structure and liquidity
Incorporated in 2002, EEPL manufactures process control and
automation instruments. The manufacturing facilities are in Pune
and in Kesurdi, Khandala. The promoter, Mr. Rajendra Nagaonkar, is
an electrical engineer with three decades of experience.
GKB OPHTHALMICS: CRISIL Lowers Rating on INR9.0cr Loan to D
-----------------------------------------------------------
CRISIL Ratings has downgraded its ratings on the bank facilities of
GKB Ophthalmics Limited (GKB) to 'CRISIL D/CRISIL D' from 'CRISIL
B/Stable/CRISIL A4'. The downgrade reflects poor liquidity profile
marked by delay in servicing of term debt obligation.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Bank Guarantee 0.9 CRISIL D (Downgraded from
'CRISIL A4 ')
Cash Credit 9.0 CRISIL D (Downgraded from
'CRISIL B/Stable')
Letter of Credit 4.2 CRISIL D (Downgraded from
'CRISIL A4 ')
Export Packing 1.0 CRISIL D (Downgraded from
Credit 'CRISIL B/Stable')
The ratings continue to reflect the GKB's modest scale of
operations, large working capital requirement and weak debt
protection metrics. These weaknesses are partially offset by the
extensive experience of the promoters in the ophthalmic lenses
industry.
Analytical Approach
CRISIL Ratings has continued with non-consolidation of GKB with its
wholly-owned subsidiaries, namely GKB Ophthalmics Products FZE
(Sharjah, UAE) and GSV Ophthalmics Pvt Ltd, based on the following
factors:
* Management-stated stance to view the company on a standalone
basis
* Transactions with subsidiaries are at an arm's s length
* There appears to be no cash flow fungibility between GKB and
these companies
Key Rating Drivers & Detailed Description
Weaknesses:
* Delays in servicing debt obligation: There have been delays in
term loan servicing on account of poor liquidity position.
* Modest scale and large working capital requirement: Revenue
declined to INR21 crore in fiscal 2021 from INR25 crore in the
previous fiscal due to lockdown-related restriction and is expected
to remain subdued because of intense competition from the Chinese
market. Also, operations are working capital-intensive, as
reflected in high gross current asset days estimated at 326 days as
on March 31, 2021, driven by receivables and inventory of 128 and
112 days estimated respectively. Payables estimated at 187 days
extended by the suppliers eased some of the pressure on the working
capital. The remaining requirement is to be met through the working
capital limit.
* Weak debt protection metrics: GKB has reported losses at the
operating level, resulting in weak debt protection metrics,
indicated by interest coverage and net cash accrual to adjusted
debt ratios of 1.43 time and 0.05 time, estimated respectively, in
fiscal 2021.
Strengths:
* Promoters' extensive experience: The three-decade-long experience
of the promoters and their longstanding relationships with
suppliers and customers have helped the company successfully
navigate business cycles over the years.
Liquidity: Poor
Liquidity is poor as reflected in delays in debt servicing.
Rating Sensitivity factors
Upward factors:
* Track record of timely debt servicing for 90 days or more
* Sharp and sustained improvement in working capital cycle
Incorporated in 1981, GKB commenced operations in 1983. The company
manufactures ophthalmic lenses, such as single-vision glass,
single-vision plastic, bifocal plastic and photochromic plastic
lenses. Mr. KG Gupta, Mr. Vikram Gupta and Mr. Gaurav Gupta are the
promoters of the company.
HBS SEAVIEW PRIVATE: Insolvency Resolution Process Case Summary
---------------------------------------------------------------
Debtor: HBS Seaview Private Limited
505, Ceejay House
Dr. Annie Besant Road
Worli, Mumbai
MH 400018
Insolvency Commencement Date: August 5, 2021
Court: National Company Law Tribunal, Mumbai Bench
Estimated date of closure of
insolvency resolution process: February 9, 2022
(180 days from commencement)
Insolvency professional: Manish Motilal Jaju
Interim Resolution
Professional: Manish Motilal Jaju
C/o M.M. Jaju & Co
D-502, Neelkanth Business Park
Vidyavihar (West)
Mumbai, MH 400086
E-mail: mmjaju76@gmail.com
cirp.hbsseaview@gmail.com
Classes of creditors: Allottees under a Real Estate Project
as per claue (f) of section 5(8)
Insolvency
Professionals
Representative of
Creditors in a class: Mukesh Kathuria
Hemant Mehta
Atul Mehta
Last date for
submission of claims: August 27, 2021
HINDUSTAN DISTRIBUTOR: CRISIL Keeps B+ Rating in Not Cooperating
----------------------------------------------------------------
CRISIL Ratings said the rating on bank facilities of Hindustan
Distributor (HD) continues to be 'CRISIL B+/Stable Issuer Not
Cooperating'.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Cash Credit 10 CRISIL B+/Stable (Issuer Not
Cooperating)
CRISIL Ratings has been consistently following up with HD for
obtaining information through letters and emails dated January 26,
2021 and July 29, 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 HD, which restricts CRISIL
Ratings' ability to take a forward looking view on the entity's
credit quality. CRISIL Ratings believes that rating action on HD is
consistent with 'Assessing Information Adequacy Risk'. Based on the
last available information, the ratings on bank facilities of HD
continues to be 'CRISIL B+/Stable Issuer Not Cooperating'.
HD is a partnership firm of Mr. Ajay Hans and Mr. Shakti Hans, who
also manage operations. It is part of the Hans group based in
Bhubaneswar. The firm trades in fast-moving consumer goods and
consumer durables in Odisha, through retail and institutional
sales.
INTELLIGENT TEXTILE: Insolvency Resolution Process Case Summary
---------------------------------------------------------------
Debtor: Intelligent Textile Engineers Private Limited
Plot No. 4, Vijay Textile Compound
Narol, Narol-Vatva Road
Ahmedabad 382405
Gujarat
Insolvency Commencement Date: August 2, 2021
Court: National Company Law Tribunal, Ahmedabad Bench
Estimated date of closure of
insolvency resolution process: January 29, 2022
Insolvency professional: Cabalmukund Kabra
Interim Resolution
Professional: Cabalmukund Kabra
508, 21st Century Business Center
Near Udhana Darwaja
Ring Road, Surat 395002
E-mail: bkabraco@yahoo.com
cirp.intelligenttextile@gmail.com
Mobile: 9426166655
Last date for
submission of claims: August 23, 2021
INTERCRAFT TRADING: CRISIL Keeps B+ Ratings in Not Cooperating
--------------------------------------------------------------
CRISIL Ratings said the ratings on bank facilities of Intercraft
Trading Private Limited continue to be 'CRISIL B+/Stable Issuer Not
Cooperating'.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Cash Credit 4.9 CRISIL B+/Stable (Issuer Not
Cooperating)
Proposed Long Term 2.1 CRISIL B+/Stable (Issuer Not
Bank Loan Facility Cooperating)
CRISIL Ratings has been consistently following up with Intercraft
for obtaining information through letters and emails dated January
26, 2021 and July 9, 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 Intercraft, which restricts
CRISIL Ratings' ability to take a forward-looking view on the
entity's credit quality. CRISIL Ratings believes that rating action
on Intercraft is consistent with 'Assessing Information Adequacy
Risk'. Based on the last available information, the ratings on bank
facilities of Intercraft continue to be 'CRISIL B+/Stable Issuer
Not Cooperating'.
Intercraft is a Mumbai (Maharashtra) based distributor of luxury
fragrances, colour cosmetics and skin care products. The company is
the sole distributor for various brands in India; it supplies the
products to established department stores in India including
Shopper's stop, Lifestyle, Westside and Reliance Trends. The
company also operates luxury fragrance stores under the brand name
'Parcos'. The day-to-day operations are managed by the director of
the company, Mr. A. Shreedharan.
JAI HIND: CRISIL Keeps B+ Debt Ratings in Not Cooperating
---------------------------------------------------------
CRISIL Ratings said the ratings on bank facilities of Jai Hind
Sugar Private Limited (JHSPL) continue to be 'CRISIL B+/Stable
Issuer Not Cooperating'.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Cash Credit 5 CRISIL B+/Stable (Issuer Not
Cooperating)
Sugar Pledge 35 CRISIL B+/Stable (Issuer Not
Cash Credit Cooperating)
Term Loan 91 CRISIL B+/Stable (Issuer Not
Cooperating)
CRISIL Ratings has been consistently following up with JHSPL for
obtaining information through letters and emails dated January 26,
2021 and July 9, 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 JHSPL, which restricts CRISIL
Ratings' ability to take a forward looking view on the entity's
credit quality. CRISIL Ratings believes that rating action on JHSPL
is consistent with 'Assessing Information Adequacy Risk'. Based on
the last available information, the ratings on bank facilities of
JHSPL continues to be 'CRISIL B+/Stable Issuer Not Cooperating'.
Incorporated in 2006, JHSPL is promoted by Mr. Bhaskar Sidram Mane
and his son Mr. Ganesh Mane. The company operates a 3500 TCD sugar
plant with a co-gen power capacity of 18 MW at Achegaon in
Maharashtra. The company is undertaking capex for setting up a
distillery unit with a capacity of 45 KLPD.
JAI SAI RAM: Insolvency Resolution Process Case Summary
-------------------------------------------------------
Debtor: Jai Sai Ram Steel Private Limited
Registered office:
Plot No. 130, Ground floor
Block-AA, Shalimar Bagh
New Delhi 110088
Factory at:
Village-Ahmedpur
Delhi Road
Behind Diwan Farm
Sonipat, Haryana
Insolvency Commencement Date: July 30, 2021
Court: National Company Law Tribunal, New Delhi Bench
Estimated date of closure of
insolvency resolution process: January 27, 2022
Insolvency professional: Sunil Prakash Sharma
Interim Resolution
Professional: Sunil Prakash Sharma
Lower Ground Floor, E-25
Lajpat Nagar-3
New Delhi 24
E-mail: adv.sunilprakash@gmail.com
- and -
Lower Ground Floor, J-12
Jangpura Extension
New Delhi 14
Tel: 011-41716695
E-mail: irpsunil.jaisairam@gmail.com
Last date for
submission of claims: August 20, 2021
JANAKIRAMA RAW: CRISIL Keeps B+ Debt Rating in Not Cooperating
--------------------------------------------------------------
CRISIL Ratings said the rating on bank facilities of Janakirama Raw
and Boiled Rice Mill (JRBRM) continues to be 'CRISIL B+/Stable
Issuer Not Cooperating'.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Open Cash Credit 9 CRISIL B+/Stable (Issuer Not
Cooperating)
CRISIL Ratings has been consistently following up with JRBRM for
obtaining information through letters and emails dated January 26,
2021 and July 9, 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 JRBRM, which restricts CRISIL
Ratings' ability to take a forward-looking view on the entity's
credit quality. CRISIL Ratings believes that rating action on JRBRM
is consistent with 'Assessing Information Adequacy Risk'. Based on
the last available information, the ratings on bank facilities of
JRBRM continue to be 'CRISIL B+/Stable Issuer Not Cooperating'.
Set up in 2000, JRBRM mills and processes paddy into rice, rice
bran, broken rice and husk. The mill is at Vakada, Andhra Pradesh.
The operations are managed by key promoter, Mr. MV Chowdary.
JCBL LTD: CRISIL Withdraws D Rating on INR29cr Cash Loan
--------------------------------------------------------
CRISIL Ratings has withdrawn its ratings on INR6 Crore of Bank
Guarantee, INR 29 Crore Cash Credit, INR2 Crore of Foreign exchange
forward Facility, INR22 Crore of Inland/import letter of credit,
INR 22.4 Crore of Proposed long-term bank loan facility and INR 15
Crore of Rupee Term Loan of JCBL Ltd (JCBL) on the request of the
company and receipt of a no objection certificate from banker. The
rating action is in line with CRISIL Ratings' policy on withdrawal
of its ratings on bank loans.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Bank Guarantee 6 CRISIL D (ISSUER NOT
COOPERATING, Rating Withdrawn)
Cash Credit 29 CRISIL D (ISSUER NOT
COOPERATING, Rating Withdrawn)
Corporate Loan 11.92 CRISIL D (Issuer Not
Cooperating)
Foreign Exchange 2 CRISIL D (ISSUER NOT
Forward COOPERATING, Rating Withdrawn)
Inland/Import 22 CRISIL D (ISSUER NOT
Letter of Credit COOPERATING, Rating Withdrawn)
Long Term Loan 1.68 CRISIL D (Issuer Not
Cooperating)
Proposed Long Term 22.40 CRISIL D (ISSUER NOT
Bank Loan Facility COOPERATING, Rating Withdrawn)
Rupee Term Loan 15 CRISIL D (ISSUER NOT
COOPERATING, Rating Withdrawn)
CRISIL Ratings has been consistently following up with JCBL for
obtaining information through letters and emails dated February 22,
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 JCBL. This restricts CRISIL
Ratings' ability to take a forward-looking view on the entity's
credit quality. CRISIL Ratings believes that rating action on JCBL
is consistent with 'Assessing Information Adequacy Risk'. Based on
the last available information, the ratings on bank facilities of
JCBL continue to be 'CRISIL D/CRISIL D Issuer Not Cooperating'.
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.
KARANJA TERMINAL: CRISIL Migrates D Rating from Not Cooperating
---------------------------------------------------------------
Due to inadequate information, CRISIL Ratings, in line with SEBI
guidelines, had migrated its ratings on bank facilities of Karanja
Terminal & Logistics Private Limited (KTLPL) to 'CRISIL D Issuer
Not Cooperating'. However, the management has subsequently started
sharing the information, necessary for carrying out a comprehensive
review of the rating. Consequently, the rating is migrated to
'CRISIL D'.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Funded Interest 57 CRISIL D (Migrated from
Term Loan 'CRISIL D ISSUER NOT
COOPERATING')
Term Loan 413 CRISIL D (Migrated from
'CRISIL D ISSUER NOT
COOPERATING')
Working Capital 10 CRISIL D (Migrated from
Term Loan 'CRISIL D ISSUER NOT
COOPERATING')
The rating continues to reflect KTLPL's weak liquidity, with delay
in servicing of debt obligations and delay in stabilization of
operations. This is partially offset by strategic location of the
terminal and its comfortable capital structure.
Analytical Approach
Unsecured loans from promoters and related parties, outstanding at
INR70.3 crore as of March 31, 2021, have been treated as debt.
Key Rating Drivers & Detailed Description
Weaknesses:
* Delay in term debt obligations: KTLPL's weak liquidity is
reflected in delays in servicing of interest and principal on the
term loans till May-2021. Subsequently, as part of the one-time
restructuring (OTR) scheme related to Covid-19 announced by the
Reserve Bank of India (RBI), it has a restructured its debt of
INR494 crore (anticipated as of Feb 28, 2022) in Jun-2021 majorly
incorporating term loan tenure extension and interest rate
reduction. As a result, KTLPL has a limited track record of timely
payments and with repayment obligations of INR2.3 crore in fiscal
2022 and INR12.8 crore in fiscal 2023, it will need significant
ramp-up in operations to ensure timely debt servicing in future.
* Delay in stabilization of operations: Project implementation was
delayed with revised commercial operation date (COD) achieved in
Sept-2019, as against originally scheduled COD of Oct-2015. The
company is yet to stabilise operations and display track record of
steady cash flows to support debt servicing.
Strengths:
* Strategic location of the terminal: KTLPL's offerings at its
terminal include ship-related services, port conservancy services,
and cargo-related services and is expected to have a diversified
revenue profile. Moreover, the terminal is strategically located 25
kilometre away from Jawaharlal Nehru Port Trust, Navi Mumbai. As a
result, it has signed agreements with few of its customers in the
recent past.
* Comfortable capital structure: KTPLP's capital structure is
marked by comfortable gearing and total outside liabilities to
adjusted networth ratios of 0.68 time and 0.89 time, respectively,
as on March 31, 2021 supported by strong equity support from
promoters. Despite PAT losses anticipated over the medium term,
leading to further reduction in networth, capital structure is
expected to remain comfortable.
Liquidity: Poor
Liquidity is poor marked by delay in repayment of term debt
obligations in past. For the restructured debt, repayments will
commence from March-2022. Against repayment obligations of INR2.3
crore in fiscal 2022 and INR12.8 crore in fiscal 2023, it is
expected to generate cash accruals of more than INR15 crore per
fiscal supported by expected ramp-up in operations. It had cash and
cash equivalents of INR17.1 crore as on March 31, 2021.
Rating Sensitivity factors
Upward Factor
* Track record of timely debt servicing for at least 90 days.
* Stabilisation of operations leading to healthy accruals and
improved financial risk profile.
KTLPL, incorporated in 2010 and promoted by Mr. Jay Mehta, operates
a multipurpose terminal and ship repair facility at Karanja creek
in Raigad, Maharashtra.
KIRAN GLOBAL: Insolvency Resolution Process Case Summary
--------------------------------------------------------
Debtor: Kiran Global Chems Limited
R.S.No. 37, Nagore Road
T.R. Pattinam, Karaikal
PY 611002
IN
Insolvency Commencement Date: April 27, 2021
Court: National Company Law Tribunal, Chennai Bench
Estimated date of closure of
insolvency resolution process: October 24, 2021
Insolvency professional: Tharuvai Ramachandran Ravichandran
Interim Resolution
Professional: Tharuvai Ramachandran Ravichandran
G3, Block II, Shivani Apartments
40 East Coast Road
Thiruvanmiyur
Chennai 600041
E-mail: trravichandra@yahoo.com
kiranglobalcirp@gmail.com
Last date for
submission of claims: May 11, 2021
MANTENA LABORATORIES: Insolvency Resolution Process Case Summary
----------------------------------------------------------------
Debtor: Mantena Laboratories Limited
Registered office:
6-3-005, 1st floor
Avatar Sadan, Plot No. 44
New Bowenpally
Hyderabad 500011
Unit 1 Factory:
Survey No. 715
Kondamadugu (V), Bibinagar (M)
Yadadri Bhuvanagiri Dist.
Telangana
Unit 2 Factory:
Survey No. 85-86, Hussainabad
Bhongir, Yadadri Bhuvanagiri Dist.
Telangana
Insolvency Commencement Date: August 6, 2021
Court: National Company Law Tribunal, Hyderabad Bench
Estimated date of closure of
insolvency resolution process: February 2, 2022
(180 days from commencement)
Insolvency professional: CA Sri Vamsi Kambhammettu
Interim Resolution
Professional: CA Sri Vamsi Kambhammettu
Plot No. A85, Flat DX4
Sri Varasiddhi Nivas
Level 2, Road No. 11
Film Nagar, Jubilee Hills
Hyderabad 500033
E-mail: casrivamsi@gmail.com
ip.mantenalab@gmail.com
Last date for
submission of claims: August 24, 2021
MECORDS INDIA: CRISIL Reaffirms B+ Rating on INR43.43 Cash Loan
---------------------------------------------------------------
CRISIL Ratings has reaffirmed its 'CRISIL B+/Stable/CRISIL A4'
ratings on the bank facilities of Mecords India Pvt Ltd (MIPL).
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Cash Credit 25 CRISIL B+/Stable (Reaffirmed)
Letter of Credit 17.57 CRISIL A4 (Reaffirmed)
Proposed Long Term
Bank Loan Facility 43.43 CRISIL B+/Stable (Reaffirmed)
Operating performance has improved in the first quarter of fiscal
2022, reflected in revenue of around INR24 crore and operating
margin estimated above 25%, driven by price revision from key
customers and healthy order book. The improvement will likely be
sustained over the medium term. However, timely addition of new
machines and availability of enhanced capacities will be critical
to sustain healthy order book and revenue growth over the medium
term.
The financial risk profile, especially capital structure, and
liquidity remain constrained. Although gearing declined to 2.56
times as on March 31, 2021, from around 3 times a year earlier, it
will remain high over the medium term owing to planned debt-funded
capital expenditure (capex). Furthermore, bank lines were fully
utilised. Enhanced working capital limit and financial closure for
capex are critical and will be closely monitored.
The ratings continue to reflect the company's below-average capital
structure because of large working capital requirement and capex,
and end-user industry concentration in revenue. These weaknesses
are partially offset by the extensive experience of the promoters
in the tyre and rubber industry, healthy relationships with reputed
clients and adequate debt protection metrics.
Key rating drivers and detailed description
Weaknesses:
* Below-average capital structure: Networth was modest at INR28
crore, while gearing was high at 2.56 times, as on March 31, 2021.
The company is undertaking large, debt-funded expansion capex of
INR120 crore. Over the past two fiscals, INR30-35 crore has been
invested towards purchase of land and shed construction; the
balance for purchase of machinery will be incurred in the medium
term. The debt-funded capex and large working capital requirement
will likely keep gearing high at 2.5-3 times over the medium term.
* Large working capital requirement: Gross current assets were
large at 288-362 days over the three fiscals ended March 31, 2021,
driven by sizeable receivables and inventory.
* End-user industry concentration in revenue: Revenue primarily
comes from tire manufacturing players. The company's business and
earnings are dependent on the demand for tires, and in turn for
automobiles, though it is partly insulated from replacement demand.
Although strong revenue growth is expected in fiscal 2022 given the
healthy order book, sustenance of revenue growth, timely capacity
enhancement and efficient management of working capital will be key
monitorables.
Strengths:
* Extensive experience of the promoters: The promoters' experience
of three decades in the tire and rubber industry, understanding of
the technical aspects of business and dynamics of the market, and
healthy relationships with suppliers and reputed customers will
continue to support the business.
* Reputed clientele: The company derives majority of its revenue
from reputed tyre companies such as MRF Ltd, TVS Srichakra Ltd,
CEAT Ltd, Apollo Tyres Ltd ('CRISIL AA+/Stable/CRISIL A1+') and JK
Tyre & Industries Ltd. Longstanding relationships with these
customers is likely to result in steady offtake over the medium
term. MIPL has orders of around INR217 crore, which provide
adequate revenue visibility.
* Adequate debt protection: Despite high gearing, debt protection
metrics were comfortable owing to healthy profitability. The
interest coverage and net cash accrual to total debt ratios were
2.13 times and 0.09 time, respectively, in fiscal 2021. Despite
expected increase in debt because of the planned capex, the metrics
will remain adequate over the medium term supported by improvement
in profitability.
Liquidity: Stretched
Cash accrual, expected at INR13-16 crore per annum over the medium
term, will adequately cover yearly term debt obligation of INR10-12
crore. The accrual and repayment will remain largely linked with
capex loan disbursement.
Bank limit utilisation was high at 99% on average in the 12 months
through July 2021. Enhancement in working capital lines to support
growth in revenue will be critical. Current ratio was moderate at
1.1 times as on March 31, 2021.
Outlook: Stable
CRISIL Ratings believes MIPL will continue to benefit from the
extensive experience of the promoters and established relationships
with clients.
Rating sensitivity factors
Upward factors
* Increase in revenue and healthy operating margin, leading to cash
accrual of around INR18 crore
* Significant improvement in the capital structure
* Timely and adequate enhancement in bank lines, and improved
liquidity
Downward factors
* Net cash accrual drops below INR7 crore on account of decline in
revenue or operating profit
* Stretched working capital cycle or delay in capex completion
weakening the liquidity
Incorporated in 1990, MIPL manufactures woven tire-reinforcing
technical textiles, industrial fabrics and specialty fabrics. The
registered office is in Mumbai, and manufacturing unit is in
Tarapur, Maharashtra, which has an installed capacity of 2,475
MTPA. The company is promoted by Mr. Nitin G Mehta and Mr. Ajit G
Mehta.
MONARCH MULTILAYERS: Insolvency Resolution Process Case Summary
---------------------------------------------------------------
Debtor: Monarch Multilayers Private Limited
Shubham 47, Akhara Town
Dharampeth, Nagpur
Maharashtra 440010
Insolvency Commencement Date: August 4, 2021
Court: National Company Law Tribunal, Mumbai Bench
Estimated date of closure of
insolvency resolution process: January 31, 2022
Insolvency professional: Mr. Vikas Prakash Gupta
Interim Resolution
Professional: Mr. Vikas Prakash Gupta
G-19, Shreewardhan Complex
Mezzanine Floor
Besides Landmark Building
Ramdaspeth, Wardha Road
Nagpur, Maharashtra 440010
E-mail: vikas.gupta@bngca.com
ip.monarch2021@gmail.com
cirp.monarch1108@gmail.com
Last date for
submission of claims: August 25, 2021
NEEL MOTORS: Insolvency Resolution Process Case Summary
-------------------------------------------------------
Debtor: Neel Motors LLP
Sr. No. 80/2/5, 80/2/4, 80/2/3
Jaymala Business Centre
E Wing, Mouje
Manjari BK Pune
Maharashtra 412307
Insolvency Commencement Date: August 4, 2021
Court: National Company Law Tribunal, New Delhi Bench
Estimated date of closure of
insolvency resolution process: January 31, 2022
Insolvency professional: Mukesh Kumar Gupta
Interim Resolution
Professional: Mukesh Kumar Gupta
171 Sita Ram Apartment
102 IP Ext
New Delhi 110092
E-mail: guptam11@gmail.com
- and -
Witworth Insolvency Professionals
Pvt. Ltd.
D-54, First Floor
Defence Colony
New Delhi 110024
E-mail: ip.neelmotors@gmail.com
Last date for
submission of claims: August 24, 2021
NEXUS FEEDS: Insolvency Resolution Process Case Summary
-------------------------------------------------------
Debtor: Nexus Feeds Limited
Door No. 8-1-301/86-87
Plot No. 101, Saipriya Residency
Lakshmi Nagar Colony
Hyderabad, Telangana 500008
India
Insolvency Commencement Date: August 4, 2021
Court: National Company Law Tribunal, Hyderabad Bench
Estimated date of closure of
insolvency resolution process: January 31, 2022
(180 days from commencement)
Insolvency professional: Manjeet Bucha
Interim Resolution
Professional: Manjeet Bucha
C/o Manjeet & Kiran Associates LLP
Company Secretaries
5-9-91 & 93, D.No. 204
2nd Floor, Shakti Sai Complex
Near Udai Clinic
Chapel Road, Abids
Hyderabad 500001
E-mail: manjeetbucha@gmail.com
nexus.cirp@gmail.com
Tel: +919346955001
Last date for
submission of claims: August 24, 2021
NIMBUS HARBOR: CRISIL Withdraws B Rating on INR3cr Cash Credit
--------------------------------------------------------------
Due to inadequate information, CRISIL Ratings, in line with SEBI
guidelines, had migrated the rating of Nimbus Harbor Facilities
Management Private Limited (Nimbus) to 'CRISIL B/Stable/CRISIL A4
Issuer Not Cooperating'. CRISIL Ratings has withdrawn its ratings
on bank facility of Nimbus following a request from the company and
on receipt of a 'no dues certificate' from the banker.
Consequently, CRISIL Ratings is migrating the ratings on bank
facilities of Nimbus from 'CRISIL B/Stable/CRISIL A4 Issuer Not
Cooperating to 'CRISIL B/Stable/CRISIL A4'. The rating action is in
line with CRISIL Ratings' policy on withdrawal of bank loan
ratings.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Bank Guarantee 7 CRISIL A4 (Migrated from
'CRISIL A4 ISSUER NOT
COOPERATING'; Rating
Withdrawn)
Cash Credit 3 CRISIL B/Stable (Migrated
from 'CRISIL B/Stable ISSUER
NOT COOPERATING'; Rating
Withdrawn)
Incorporated in July 2004 and promoted by Mr. Naveen Srivastava and
his wife, Ms Samta Srivastava, Gurugram-based Nimbus provides
integrated facility management services such as housekeeping,
cleaning, maintenance and engineering, and pest control.
NISHA ENTERPRISES: CRISIL Keeps B+ Debt Rating in Not Cooperating
-----------------------------------------------------------------
CRISIL Ratings said the ratings on bank facilities of Nisha
Enterprises (NE) continue to be 'CRISIL B+/Stable Issuer Not
Cooperating'.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Cash Credit 7 CRISIL B+/Stable (Issuer Not
Cooperating)
CRISIL Ratings has been consistently following up with NE for
obtaining information through letters and emails dated January 26,
2021 and July 9, 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 NE, which restricts CRISIL
Ratings' ability to take a forward looking view on the entity's
credit quality. CRISIL Ratings believes that rating action on NE is
consistent with 'Assessing Information Adequacy Risk'. Based on the
last available information, the ratings on bank facilities of NE
continues to be 'CRISIL B+/Stable Issuer Not Cooperating'.
NE is a distributor of Steel Authorities of India Ltd (SAIL) for
HR/CR coils and plates, CI bolder and casting, and MS ingots in
Bokaro, Jharkhand. Daily operations are managed by proprietor Ms
Sarita Devi.
OPAL LUXURY: Insolvency Resolution Process Case Summary
-------------------------------------------------------
Debtor: Opal Luxury Time Products Ltd
Unit No. 5, Dangat Patil Nagar
S.No. 82/3, Shivane
Off NDA Road
Pune 411023
Insolvency Commencement Date: August 3, 2021
Court: National Company Law Tribunal, Pune Bench
Estimated date of closure of
insolvency resolution process: January 29, 2022
Insolvency professional: Mr. Vithal M. Dahake
Interim Resolution
Professional: Mr. Vithal M. Dahake
603 Neelgiri Apartments
Aba Karmarkar Marg
Yashodham, Goregaon-East
Mumbai 400013
E-mail: vm.dahake@rediffmail.com
opalluxurytime@gmail.com
Last date for
submission of claims: August 25, 2021
PACIFIC SHARES: Insolvency Resolution Process Case Summary
----------------------------------------------------------
Debtor: Pacific Shares and Stock Broker Limited
419B, 4th Floor, Plot no. 21
Panchratna, Mama Parmanand Marg
Opera House, Girgaon
Mumbai 400004
Insolvency Commencement Date: July 28, 2021
Court: National Company Law Tribunal, Mumbai Bench
Estimated date of closure of
insolvency resolution process: January 24, 2022
(180 days from commencement)
Insolvency professional: CA Pawan Kumar Ramdhan Agarwal
Interim Resolution
Professional: CA Pawan Kumar Ramdhan Agarwal
42, Gopal Bhawan
199 Princess Street
Mumbai 400002
Mobile: 9821063418
E-mail: arbitratorpr@gmail.com
Last date for
submission of claims: August 11, 2021
PRATISHTHA DAIRY: Insolvency Resolution Process Case Summary
------------------------------------------------------------
Debtor: Pratishtha Dairy Farms Private Limited
Nand Colony, Peetal Nagari
Moradabad, Uttar Pradesh 244001
Insolvency Commencement Date: August 11, 2021
Court: National Company Law Tribunal, Allahabad Bench
Estimated date of closure of
insolvency resolution process: February 6, 2022
Insolvency professional: Ankit Agrawal
Interim Resolution
Professional: Ankit Agrawal
F-53, Second Floor
Butler Plaza, Civil Lines
Near Chowki Chauraha
Bareilly, Uttar Pradesh 243001
E-mail: ankitagarwalcs@gmail.com
cirp.pdf@gmail.com
Last date for
submission of claims: August 25, 2021
PRIMUSS PIPES: Insolvency Resolution Process Case Summary
---------------------------------------------------------
Debtor: Primuss Pipes & Tubes Limited
8/225-A, 2nd floor
Arya Nagar, Kanpur
Uttar Pradesh 208002
Insolvency Commencement Date: August 4, 2021
Court: National Company Law Tribunal, Allahabad Bench
Estimated date of closure of
insolvency resolution process: January 31, 2022
(180 days from commencement)
Insolvency professional: Mr. Nitin Jain
Interim Resolution
Professional: Mr. Nitin Jain
E-337, Ground floor
Greater Kailash-I, New Delhi
National Capital Territory of Delhi
110048
E-mail: nitinjain@
ichinencapitalservices.com
- and -
E-10A, Kailash Colony
Greater Kailash-1
New Delhi 110048
E-mail: primuss.pipes@aaainsolvency.com
nitinjain@aaainsolvency.com
Last date for
submission of claims: August 18, 2021
RAJDEEP BUILDCON: CRISIL Lowers Rating on INR310.35cr Loan to D
---------------------------------------------------------------
CRISIL Ratings has downgraded its ratings on the bank facilities of
Rajdeep Buildcon Private Limited (RBPL; part of the Rajdeep group)
to 'CRISIL D/CRISIL D' from 'CRISIL B/Stable/CRISIL A4'.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Bank Guarantee 310.35 CRISIL D (Downgraded from
'CRISIL A4')
Cash Credit 61.00 CRISIL D (Downgraded from
'CRISIL B/Stable')
The downgrade reflects poor liquidity profile marked by delay in
payments towards invoked bank guarantees (BGs) and devolved letters
of credit (LCs). RBPL's account was classified as a non-performing
asset (NPA) by few of its bankers in April 2021 and July 2021. We
note that RBPL confirmed timeliness in debt servicing to CRISIL
Ratings for the month of May 2021, when in fact there were
irregularities in debt servicing during this period, leading to the
current rating action.
The ratings reflect the Rajdeep group's large working capital
requirements resulting in stretched liquidity and exposure to
intense competition in the construction industry. These weaknesses
are partially offset by the extensive experience of the promoters.
Analytical Approach
For arriving at the ratings, CRISIL Ratings has combined the
business and financial risk profiles of RBPL and five more entities
of the Rajdeep group. That's because all these entities receive
funds from the same source and have a common management. CRISIL
Ratings has also consolidated other entities that are joint
ventures (JVs) RBPL has formed with the Rohan group. All
interest-bearing mobilization advances have been treated as debt.
Key Rating Drivers & Detailed Description
Weaknesses:
* Delays in servicing debt obligation: There have been delays in
payment towards invoked BGs and devolved LCs as a result of which
RBPL's account has been classified as NPA by few of its bankers.
* Working capital-intensive operations: Gross current assets of the
group have remained high on account of large receivables and
inventory. Receivables of RBPL (standalone) increased to over 230
days as on March 31, 2020, from 181 days as on March 31, 2019, due
to a stretch in receivables which got intensified on account of the
lockdown. Further, lower business activity has led to a stretch in
liquidity and devolvement of LCs and invocation of BGs.
* Exposure to intense competition and to cyclicality in the
construction industry: Cyclicality is inherent in the industry, and
with intense competition in the
engineering-procurement-construction segment, leads to volatile
profitability. The industry is dominated by large players such as
Larsen & Toubro Ltd, Dilip Buildcon Ltd, Ashoka Buildcon Ltd,
Sadbhav Engineering Ltd and Nagarjuna Construction Co. Ltd, which
have an edge over small and medium-sized players. The smaller
players mainly have a regional presence. Given the group's
expanding geographical reach, it could face competition from
entrenched regional players, which would put pressure on the
operating margin.
Strengths
* Promoters' extensive experience: With an established track record
of almost three decades in the construction sector, RBPL has Class
IA (highest level) status in Karnataka, Gujarat, Rajasthan and
Maharashtra. The company has a diversified revenue profile, and
proven project-execution capabilities.
Liquidity: Poor
Liquidity is poor as reflected in delays in debt servicing.
Rating Sensitivity Factors
Upward factors:
* Track record of timely debt servicing for 90 days or more
* Sharp and sustained improvement in working capital cycle
Based in Ahmednagar, Maharashtra, RBPL is the flagship company of
the Rajdeep group that undertakes industrial and infrastructure
construction projects through affiliates. The company was set up by
Mr. Dilip Dhadiwal, Mr. Kishor Dhadiwal and Mr. Rajesh Kataria as a
partnership firm in 1992, but was reconstituted as a private
limited company in 1997. In infrastructure construction, the group
makes bridges, gantries and roads. In the rural electrification
segment, it has taken up projects for supply, testing, transport,
construction, erection, and commissioning of sub-transmission
lines, power transformers, and new substations. In the industrial
segment, it constructs factories, structures and warehouses.
The Rajdeep group operates through 15 entities, of which six are
standalone companies and nine are JVs with the Rohan group. The
Rajdeep group tied up with the Rohan group (for
build–operate–transfer road projects) primarily to qualify for
large bids.
On a standalone basis, the company's revenue for fiscal 2020 stood
at INR230 crore against INR305 crore for fiscal 2019; revenue was
about INR50 crore in the first half of fiscal 2021.
RAJHANS INDUSTRIES: Insolvency Resolution Process Case Summary
--------------------------------------------------------------
Debtor: Rajhans Industries Private Limited
A-2, Industrial Estate
Jodhpur 342003
Rajasthan
Insolvency Commencement Date: August 5, 2021
Court: National Company Law Tribunal, Jaipur Bench
Estimated date of closure of
insolvency resolution process: February 1, 2022
Insolvency professional: Prashant Agrawal
Interim Resolution
Professional: Prashant Agrawal
P. Agrawal & Associates
F-106, 1st Floor
Sumer Complex, Gautam Marg
C-Scheme, Jaipur
Rajasthan 302001
E-mail: ippagrawal@gmail.com
cirp.rajhans@gmail.com
Last date for
submission of claims: August 19, 2021
RAMJI ACRO: CRISIL Keeps B+ Debt Ratings in Not Cooperating
-----------------------------------------------------------
CRISIL Ratings said the ratings on bank facilities of Ramji Acro
Limited (RAL) continue to be 'CRISIL B+/Stable Issuer Not
Cooperating'.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Cash Credit 10 CRISIL B+/Stable (Issuer Not
Cooperating)
Proposed Long Term 1 CRISIL B+/Stable (Issuer Not
Bank Loan Facility Cooperating)
Term Loan 9 CRISIL B+/Stable (Issuer Not
Cooperating)
CRISIL Ratings has been consistently following up with RAL for
obtaining information through letters and emails dated January 26,
2021 and July 9, 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 RAL, which restricts CRISIL
Ratings' ability to take a forward-looking view on the entity's
credit quality. CRISIL Ratings believes that rating action on RAL
is consistent with 'Assessing Information Adequacy Risk'. Based on
the last available information, the ratings on bank facilities of
RAL continues to be 'CRISIL B+/Stable Issuer Not Cooperating'.
RAL, incorporated in 2002 and based in Ludhiana. Punjab, is
promoted by Mr. Vishal Gupta and his family members. The company
primarily manufactures acrylic yarn under its own brand Mai Baap.
RANSAN PACKAGING: CRISIL Lowers Rating on INR5.1cr Loan to D
------------------------------------------------------------
CRISIL Ratings has downgraded its ratings on the bank facilities of
Ransan Packaging Private Limited (RPPL) to 'CRISIL D/CRISIL D' from
'CRISIL B+/Stable/CRISIL A4'.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Cash Credit 5.1 CRISIL D (Downgraded from
'CRISIL B+/Stable')
Letter of Credit 4.5 CRISIL D (Downgraded from
'CRISIL A4')
Working Capital 0.4 CRISIL D (Downgraded from
Term Loan 'CRISIL B+/Stable')
The rating reflects delays in the in the last 3 months due to poor
liquidity. This was caused by impact on operating performance due
to the second wave covid-19 pandemic.
The rating reflects the company's small scale of operations amid
intense competition in the packaging industry and its weak
financial risk profile. The weaknesses are partially offset by the
extensive experience of the promoters.
Key Rating Drivers & Detailed Description
Weakness:
* Delays in debt servicing: There has been delay in repayment of
term loan in the last 3 months mainly on account of weak liquidity
arising from pandemic led impact on the operating performance.
* Modest scale of operations in competitive segment: Revenue is
estimated at around INR25 crore in fiscal 2021 indicates the
company's small scale. This, along with intense competition, will
continue to constrain the business risk profile.
* Weak financial risk profile: Capital structure was leveraged
marked by estimated high gearing of 12.41 times as on March 31,
2021, because of large term loans and small net worth of INR1.21
crore. Debt protection metrics were weak, reflected in estimated
interest coverage and net cash accrual to adjusted debt ratios of
1.29 times and 0.04 time, respectively, for fiscal 2021.
Strengths:
* Promoters' extensive experience: Presence of more than 40 years
in the printing and packaging industry has enabled the promoters to
develop a strong insight into market dynamics and establish healthy
relationship with customers and suppliers.
Liquidity: Poor
Liquidity is poor, as reflected in delays in debt servicing in the
last 3 months. With impact on operating performance because of the
second wave Covid-19, the working capital requirements have
increased.
Rating Sensitivity factors
Upward factor
* 90 day track record of timely repayment of debt obligations
* Increase in revenue and operating margin
Incorporated in 2013 and promoted by Mr. V A Prabhakaran and Mr. A
Srenivasan, Chennai-based RPPL manufactures and prints mono-cartons
and corrugated boxed used in the packaging industry.
RSI GROUP: CRISIL Keeps B+ Debt Ratings in Not Cooperating
----------------------------------------------------------
CRISIL Ratings said the ratings on bank facilities of RSI Group
(RSI) continue to be 'CRISIL B+/Stable Issuer Not Cooperating'.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Cash Credit 0.4 CRISIL B+/Stable (Issuer Not
Cooperating)
Proposed Long Term
Bank Loan Facility 1.6 CRISIL B+/Stable (Issuer Not
Cooperating)
CRISIL Ratings has been consistently following up with RSI for
obtaining information through letters and emails dated January 26,
2021 and July 9, 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 RSI, which restricts CRISIL
Ratings' ability to take a forward looking view on the entity's
credit quality. CRISIL Ratings believes that rating action on RSI
is consistent with 'Assessing Information Adequacy Risk'. Based on
the last available information, the ratings on bank facilities of
RSI continues to be 'CRISIL B+/Stable Issuer Not Cooperating'.
RSI, established by Mr. K. Rajarajan, is a modern trader for
various FMCG companies such as Coca-Cola and Marico. Operations are
based in Chennai.
SATYALAKSHMI RICE: CRISIL Keeps B+ Ratings in Not Cooperating
-------------------------------------------------------------
CRISIL Ratings said the ratings on bank facilities of Sri
Satyalakshmi Rice Mill (SSLRM) continue to be 'CRISIL B+/Stable
Issuer Not Cooperating'.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Cash Credit 7 CRISIL B+/Stable (Issuer Not
Cooperating)
Proposed Long Term 4 CRISIL B+/Stable (Issuer Not
Bank Loan Facility Cooperating)
CRISIL Ratings has been consistently following up with SSLRM for
obtaining information through letters and emails dated January 26,
2021 and July 9, 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 SSLRM, which restricts CRISIL
Ratings' ability to take a forward looking view on the entity's
credit quality. CRISIL Ratings believes that rating action on SSLRM
is consistent with 'Assessing Information Adequacy Risk'. Based on
the last available information, the ratings on bank facilities of
SSLRM continues to be 'CRISIL B+/Stable Issuer Not Cooperating'.
SSLRM, set up in 1984 as a partnership firm, mills and processes
paddy into rice. The firm is promoted by Mr. Jagannadha Raju, Mr.
Arun Kumar Raju, Mr. Rama Koti Raju, Mr. Dharma Raju, Mr.
Ramachandra Raju, and Ms P Usha Rani.
SESHASAI SPINNING: CRISIL Keeps B+ Ratings in Not Cooperating
-------------------------------------------------------------
CRISIL Ratings said the ratings on bank facilities of Sri Seshasai
Spinning Mills Private Limited (SSMPL) continue to be 'CRISIL
B+/Stable Issuer Not Cooperating'.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Cash Credit 13 CRISIL B+/Stable (Issuer Not
Cooperating)
Long Term Loan 6.68 CRISIL B+/Stable (Issuer Not
Cooperating)
Proposed Fund- 0.32 CRISIL B+/Stable (Issuer Not
Based Bank Limits Cooperating)
CRISIL Ratings has been consistently following up with SSMPL for
obtaining information through letters and emails dated January 30,
2021 and July 29, 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 SSMPL, which restricts CRISIL
Ratings' ability to take a forward looking view on the entity's
credit quality. CRISIL Ratings believes that rating action on SSMPL
is consistent with 'Assessing Information Adequacy Risk'. Based on
the last available information, the ratings on bank facilities of
SSMPL continues to be 'CRISIL B+/Stable Issuer Not Cooperating'.
SSMPL was set up in 2005 by Mr. Jamili Pardha Saradhi and his
family. The company manufactures cotton yarn. Its spinning mill is
located in Guntur (Andhra Pradesh).
SHRIDHAR STEELS: Insolvency Resolution Process Case Summary
-----------------------------------------------------------
Debtor: Shridhar Steels Private Limited
23 Pushpa Kunj
Commercial Complex Central Bazar Road
Ramdaspeth, Nagpur 440010
Insolvency Commencement Date: August 3, 2021
Court: National Company Law Tribunal, Nagpur Bench
Estimated date of closure of
insolvency resolution process: January 30, 2022
(180 days from commencement)
Insolvency professional: Mr. Ajay Murarilal Agrawal
Interim Resolution
Professional: Mr. Ajay Murarilal Agrawal
Shop No. 2 First Floor
Matoshreee Apartment
Satnami Nagar
Nagpur 440008
E-mail: ajayagrawal86@yahoo.co.in
ip.shridharsteel@gmail.com
Last date for
submission of claims: August 26, 2021
SHRISHTI ELECTROMECH: CRISIL Keeps B+ Ratings in Not Cooperating
----------------------------------------------------------------
CRISIL Ratings said the ratings on bank facilities of Shrishti
Electromech Private Limited (SEPL) continue to be 'CRISIL
B+/Stable/CRISIL A4 Issuer Not Cooperating'.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Bill Discounting 1.5 CRISIL B+/Stable (Issuer Not
Cooperating)
Cash Credit 6.15 CRISIL B+/Stable (Issuer Not
Cooperating)
Long Term Loan 1.41 CRISIL B+/Stable (Issuer Not
Cooperating)
Proposed Long Term
Bank Loan Facility 9.19 CRISIL B+/Stable (Issuer Not
Cooperating)
Proposed Short Term 1.00 CRISIL A4 (Issuer Not
Bank Loan Facility Cooperating)
Working Capital 0.75 CRISIL B+/Stable (Issuer Not
Demand Loan Cooperating)
CRISIL Ratings has been consistently following up with SEPL for
obtaining information through letters and emails dated January 26,
2021 and July 9, 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 SEPL, which restricts CRISIL
Ratings' ability to take a forward looking view on the entity's
credit quality. CRISIL Ratings believes that rating action on SEPL
is consistent with 'Assessing Information Adequacy Risk'. Based on
the last available information, the ratings on bank facilities of
SEPL continues to be 'CRISIL B+/Stable/CRISIL A4 Issuer Not
Cooperating'.
Set up in 2002 as a private limited company by Mr. Suresh Tibrewala
and his family in Hyderabad, SEPL manufactures a variety of fans.
SIVA INDUSTRIES: NCLT Rejects ‘Business Restructuring Plan'
-------------------------------------------------------------
The Statesman reports that NCLT Chennai has rejected the one-time
settlement offer made by Siva Industries and ordered that the
company will go into liquidation.
The Statesman relates that the NCLT Chennai Bench, comprising R.
Sucharitha and Anil Kumar B., said in the order, "The purported
settlement plan proposed by the promoters of the Corporate Debtor
is not a Settlement simpliciter, rather it is a 'Business
Restructuring Plan'.
As per the plan, there is no final offer made by the promoter of
the corporate debtor and also the acceptance made by the CoC in
this regard, the report says.
"There is no finality reached between the promoter of the Corporate
debtor and the CoC of the Settlement proposal; hence based on
ambiguity of the terms of settlement, we cannot order for the
withdrawal of CIRP."
The order also said that seeking liquidation should there be a
default was beyond the scope of IBC.
The Statesman relates that the NCLT said the application made by
RCK Vallal, one of the shareholders of the company, is not
conforming to the Section 12A of the Insolvency and Bankruptcy
Code.
Eyebrows had been raised at the settlement offer as public sector
banks agreed to settle with the promoter of Siva Industries, a huge
loan of INR4,863 crore at just 318 crore – recovery of only 6.5
per cent, the report relays, says The Statesman.
It was pointed out that the settlement amount accepted by banks is
even lower than the liquidation value of Siva Industries - will
result in loss of approximately INR4,700 crore public money, The
Statesman relates.
Instead of invoking personal guarantee of promoters, the public
sector bank Canara Bank privately sold its exposure of INR1,148
crore to a foreign owned ARC – International Asset Reconstruction
Company Private Limited (IARC).
CBI has also filed criminal case against former senior officials of
IDBI Bank and Sivasankaran for allegedly defrauding the lenders to
the tune of INR600 crore, the report notes.
Siva Industries and Holdings Limited manufactures
telecommunications equipment.
SKV INFRATECH: CRISIL Withdraws B Rating on INR4cr Cash Loan
------------------------------------------------------------
Due to inadequate information, CRISIL Ratings, in line with SEBI
guidelines, had migrated the rating of SKV Infratech Private
Limited (SIPL) to 'CRISIL B/Stable/CRISIL A4 Issuer Not
Cooperating'. CRISIL Ratings has withdrawn its ratings on bank
facility of SIPL following a request from the company and on
receipt of a 'no dues certificate' from the banker. Consequently,
CRISIL Ratings is migrating the ratings on bank facilities of SIPL
from 'CRISIL B/Stable/CRISIL A4 Issuer Not Cooperating to 'CRISIL
B/Stable/CRISIL A4'. The rating action is in line with CRISIL
Ratings' policy on withdrawal of bank loan ratings.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Bank Guarantee 20 CRISIL A4 (Migrated from
'CRISIL A4 ISSUER NOT
COOPERATING'; Rating
Withdrawn)
Cash Credit/ 4 CRISIL B /Stable (Migrated
Overdraft facility from 'CRISIL B/Stable ISSUER
NOT COOPERATING'; Rating
Withdrawn)
SIPL was set up as a partnership firm named SK Builders in the
early 1990s, and was reconstituted as a private limited company
named SIPL in August 2012. The operations are managed by Mr. Varun
Garg and Mr. Satish Garg. The company undertakes civil construction
works, mainly road construction for Public Works Department,
National Highways Authority of India, New Okhla Industrial
Development Authority, and Greater Noida Industrial Development
Authority.
SPM WEAVING: CRISIL Withdraws B Rating on INR12cr Loans
-------------------------------------------------------
CRISIL Ratings has withdrawn its rating on the bank facilities of
Sri SPM Weaving Mills (SSWM) on the request of the company and
after receiving no objection certificate from the bank. The rating
action is in-line with CRISIL Rating's policy on withdrawal of its
rating on bank loan facilities.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Cash Credit 2 CRISIL B/Stable (ISSUER NOT
COOPERATING; Rating Withdrawn)
Long Term Loan 10 CRISIL B/Stable (ISSUER NOT
COOPERATING; Rating Withdrawn)
CRISIL Ratings has been consistently following up with SSWM for
obtaining information through letters and emails dated January 14,
2020 and July 17, 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 SSWM. This restricts CRISIL
Ratings' ability to take a forward looking view on the credit
quality of the entity. CRISIL Ratings believes that rating action
on SSWM is consistent with 'Assessing Information Adequacy Risk'.
CRISIL Ratings has Continues the ratings on the bank facilities of
SSWM to 'CRISIL B/Stable Issuer not cooperating'.
Established in 2015, SSWM is setting up a weaving mill with 36
looms in Erode, Tamil Nadu. The firm is promoted by Mr. Palanisamy,
and the commercial operations are expected to commence in January
2017.
TOUGH BAGS: CRISIL Lowers Rating on INR7cr Cash Loan to D
---------------------------------------------------------
CRISIL Ratings has downgraded the rating on the bank facilities of
Tough Bags (TB) to 'CRISIL D Issuer Not Cooperating' from 'CRISIL
B+/Stable Issuer Not Cooperating' as there are delays in the
repayment of term loans and overdrawals in the cash credit
facilities over the past one year.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Cash Credit 7 CRISIL D Downgraded from
'CRISIL B+/Stable ISSUER NOT
COOPERATING')
Proposed Cash 1 CRISIL D Downgraded from
Credit Limit 'CRISIL B+/Stable ISSUER NOT
COOPERATING')
CRISIL Ratings has been consistently following up with TB for
obtaining information through letters and emails dated December 31,
2019, June 17, 2020 and March 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
Ratings failed to receive any information on either the financial
performance or strategic intent of TB, which restricts CRISIL's
ability to take a forward looking view on the entity's credit
quality. CRISIL believes that rating action on TB is consistent
with 'Assessing Information Adequacy Risk'.
Based on the last available information, CRISIL Ratings has
downgraded the rating on the bank facilities of TB to 'CRISIL D
Issuer Not Cooperating' from 'CRISIL B+/Stable Issuer Not
Cooperating' as there are delays in the repayment of term loans and
overdrawals in the cash credit facilities over the past one year.
Set-up in 1992 as a proprietorship firm, TB manufactures
complementary gifts items such as bags, pouches, shaving kits in
rexene. The firm is based in Pykara, Tamil Nadu and promoted by Mrs
Lalitha Ramalingam. Her son Mr. Palanniappan manages operations.
=================
I N D O N E S I A
=================
PT BAYAN RESOURCES: S&P Alters Outlook on 'B+' ICR to Positive
--------------------------------------------------------------
S&P Global Ratings revised the outlook on its long-term issuer
credit rating on PT Bayan Resources Tbk. to positive from stable
and affirmed the rating at 'B+'.
S&P said, "The positive outlook reflects our expectation that over
the next 12 months, Bayan will continue to make good progress in
the construction of a haul road along with infrastructure
facilities, while preserving its strong debt-servicing capability.
"We revised the outlook on Bayan to positive to reflect our view
that the increasing visibility over the completion of its haul road
and supporting infrastructure may facilitate an improvement in the
company's scale and operational resilience.Since 2019, the company
has been constructing a 100km haul road to connect the Tabang mine
to the Mahakam River. In our opinion, this alternate route will
reduce Bayan's reliance on seasonal rivers served by the Senyiur
and Gunung Sari jetties, which are subject to weather-related
disruptions, for barging coal. We believe the company is making
good progress toward its target completion date of September 2022,
having reached 30% completion as of June 2021. This will also
improve Bayan's working capital, which tends to deteriorate during
the dry season, given the seasonal inventory buildup.
"Along with the construction of a new barge loading facility, we
anticipate Bayan's production capacity will expand to 50 million
metric tons (MMT) in the next three years, from about 32 MMT
currently. The company is currently seeking an additional 5 MMT to
5.5 MMT production quota to prepare for an increase in production
capacity, and has also increased its reserves at the Tabang and
North Pakar concessions by 72% to 1,475 million tons as of Jan. 1,
2021. We estimate that this will lengthen the company's reserve
life to 50 years from 32 years.
"We affirmed the 'B+' rating on Bayan because we expect the company
to remain financially prudent, with adjusted debt to EBITDA below
3x.Over the next 18 months, we anticipate its adjusted
debt-to-EBITDA ratio will improve to below 0.5x, compared with
above 1x in 2019 and 2020. The company's financial resilience has
strengthened following the buyback of 62% of its bonds in April
2021 through a partial tender offer using excess discretionary cash
flow of US$190 million as of Dec. 31, 2020. We expect that the
remaining bond of US$148 million, which will come due by January
2023, will be largely funded by internally generated cash flow with
minimal refinancing needs. This is despite our more conservative
assumptions on thermal coal prices in 2022 and 2023 at US$60 per
ton, along with an expected step-up in capital expenditure (capex)
over the next 12 months as the company completes the construction
of the haul road."
Bayan has sufficient buffer to weather volatile operating
conditions. Seasonal dry weather at the Kedang Kepala river in East
Kalimantan, which is anticipated toward the end of the year, may
constrain Bayan's sales volumes. At the same time, the recent surge
in COVID-19 infections in Indonesia may also affect production
should the mines be forced to suspend operations. In 2020, Bayan
had to pause activities at three mines for a period of five weeks
to curb the spread of the outbreak. As of June 30, 2021, Bayan had
inventory stockpile of 2.4 MMT, which will only be sufficient to
cover less than a month of average production volumes. Nonetheless,
S&P believes the company has ample buffer to withstand a possibly
weaker second half. That's because Bayan had already chalked up
over US$520 million in reported EBITDA for the first half of 2021,
more than the annual EBITDA generated in the past two years. Cash
flow from operations for the first half of 2021 more than doubled
largely due to a close to 30% surge in average selling price, along
with US$100 million in tax refunds. S&P forecasts that the company
will generate at least US$900 million in EBITDA for 2021, based on
its price assumption for Newcastle thermal coal of US$90 per ton
for the rest of the year.
Demand from China could ease, normalizing thermal coal prices.
Indonesia's top coal importer had recently authorized the restart
of 53 coal mines amid accelerating downstream demand as power
plants seek to replenish their stockpiles. The combined annual
production capacity of these mines exceeds 110 MMT. This could
temper the rising coal prices experienced since September 2020 and
may cause the benchmark Harga Batubara Acuan coal price to fall
from its peak of US$131 per ton in August. Uncertainties
surrounding Indonesia's recent export ban on 34 local miners have
also left markets in a standstill, with some holding off trades
before understanding the implications. Although this may further
tighten Indonesian local supply, S&P believes the export ban should
be temporary given the opportunity cost on government royalties
from the current strong coal prices, along with the country's
production target of 625 MMT for 2021. Bayan has since been cleared
to resume its coal exports.
S&P expects demand for Bayan's low average calorific thermal coal
to hold steady in the medium term. This is because several Asian
countries remain steadfast in pursuing large coal-fired building
programs due to the affordability and availability of coal. These
plants are expected to remain in operation for at least 40 years,
ensuring that coal remains a significant part of energy mix within
Asia. China, for instance, which represents around one-third of
global coal consumption, has 96.7 gigawatts (GW) of coal-fired
generation currently under construction, according to data from the
Global Energy Monitor. Indonesia and India, both with large
domestic coal mining sectors, are also ploughing ahead with new
plants, currently building 11.8 GW and 34.4 GW of capacity,
respectively. Low ash and sulfur levels of Bayan's coal make it
suitable for thermal power plants across Asia and we believe that
the company's relatively diversified geographical coverage will
continue to ensure stable sales. As of June 30, 2021, the company
has various commitments to sell 262MMT of coal through 2054.
S&P said, "The positive outlook reflects our view that over the
next 12 months Bayan will continue to make good progress in the
construction of its haul road along with infrastructure facilities
while preserving its strong debt-servicing capability and robust
balance sheet.
"We could raise the rating by one notch if we believe the execution
risks surrounding the company's haul road construction and the
remaining infrastructure expansion had materially diminished,
thereby facilitating Bayan's production capacity expansion to 50
MMT over the next two to three years. This would allow the company
to diversify its operations, expand its scale, and reduce the
operational risk of weather-related disruptions. A higher rating is
also predicated on our view that the company would maintain its
prudent financial policy including a solid balance sheet and
liquidity while pursuing any growth opportunities.
"We would revise the outlook back to stable if there are any
significant delays in the construction of the haul road and
supporting infrastructure facilities, which could arise from a
worsening COVID-19 situation or an inability to obtain remaining
land permits in a timely manner. We could also revise the outlook
to stable should the company's plan to expand to 50 MMT be
derailed."
=====================
N E W Z E A L A N D
=====================
AVANTI RMBS 2021-1: Fitch Assigns BB+ Rating on Class E Notes
-------------------------------------------------------------
Fitch Ratings has assigned final ratings to Avanti RMBS 2021-1
Trust's mortgage-backed pass-through floating-rate bonds. The
issuance consists of notes backed by a pool of first-ranking, prime
and non-conforming, New Zealand residential full- and
low-documentation mortgage loans originated by Avanti Finance
Limited.
The notes were issued by The New Zealand Guardian Trust Company
Limited in its capacity as trustee of Avanti RMBS 2021-1 Trust,
which is a separate and distinct trust created under a master trust
deed.
The asset pool totalled NZD350 million at the 11 July 2021 cut-off
date and consisted of 754 obligors.
DEBT RATING PRIOR
---- ------ -----
Avanti RMBS 2021-1 Trust
A1 NZAVAD1020R4 LT AAAsf New Rating AAA(EXP)sf
A2 NZAVAD1021R2 LT AAAsf New Rating AAA(EXP)sf
B NZAVAD1022R0 LT AAsf New Rating AA(EXP)sf
C NZAVAD1023R8 LT Asf New Rating A(EXP)sf
D NZAVAD1024R6 LT BBBsf New Rating BBB(EXP)sf
E NZAVAD1025R3 LT BB+sf New Rating BB+(EXP)sf
F LT NRsf New Rating NR(EXP)sf
KEY RATING DRIVERS
Sufficient Credit Enhancement Mitigates Expected 'AAAsf' Losses:
The 'AAAsf' weighted-average foreclosure frequency (WAFF) of 22.2%
is driven by the weighted-average (WA) unindexed loan/value ratio
(LVR) of 65.1%. Under Fitch's methodology investment loans equated
to 34.1% and non-conforming loans 33.8% by balance. The 'AAAsf' WA
recovery rate of 54.7% is driven by the portfolio's WA indexed
scheduled LVR of 64.3%.
Limited Liquidity Risk: Structural features include a liquidity
facility sized at 1.0% of the note balance, with a floor of
NZD100,000, sufficient to mitigate Fitch's payment interruption
risk. Principal draws are available to fund income shortfalls
before the liquidity facility is drawn. The rated notes can
withstand all relevant Fitch stresses applied in Fitch's cash flow
analysis. The class A1, A2, B, C, D and E notes benefit from credit
enhancement of 20.0%, 10.0%, 7.0%, 4.0%, 1.9% and 0.5%,
respectively.
The class B to F notes pay interest based on the notes' stated
balance. Fitch's ratings reflect the timely and ultimate payment of
interest and its cash flow model addresses the risk that interest
may not be recovered in scenarios where there are charge-offs. This
is more conservative than transaction documentation. All classes of
notes can withstand all relevant Fitch cash flow modelling
stresses.
Originator Adjustment Applied due to Specific Differing Practices:
Avanti is a non-bank financial institution, with over 30 years of
experience in origination, underwriting, servicing and special
servicing across various asset classes in New Zealand. Fitch
undertook an operational review and found that the operations of
the originator and servicer were mostly comparable with market
standards and that there were no material changes that may affect
Avanti's ongoing ability to undertake origination, administration
and collection activities.
Fitch applied an originator adjustment of 1.05x to address specific
aspects that differ from market practices of other prime non-bank
lenders, which Fitch believes may affect the credit risk of the
transaction and assets. This has led to an overall adjustment in
the foreclosure frequency, in line with previous analysis of Avanti
transactions. The collections and servicing activities have not
been disrupted due to the coronavirus outbreak, as staff work
remotely and are able to access the disaster recovery site, if
needed.
Economic Rebound Supports Outlook: Portfolio performance is
supported by New Zealand's effective suppression of Covid-19 and
the macro-policy response, which have facilitated a robust economic
recovery. Fitch forecasts New Zealand's GDP to expand by 5.5% in
2021, revised upwards from an estimate of 4.0% earlier this year.
Fitch expects GDP growth to stabilise in 2022.
The key rating drivers listed in the applicable sector criteria,
but not mentioned above, are not material to this rating action.
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
credit losses and cash flow stresses commensurate with higher
rating scenarios, all else being equal.
-- The class A1 and A2 notes' ratings are at 'AAAsf', which is
the highest level on Fitch's scale. The ratings cannot be
upgraded.
Upgrade Sensitivity:
-- The class A1 and A2 notes' ratings are at 'AAAsf', which is
the highest level of Fitch's scale. The ratings cannot be
upgraded.
-- Class B / C / D / E
-- Current Rating: AAsf / Asf / BBBsf / BB+sf
-- Decrease defaults by 15%; increase recoveries by 15%: AAAsf /
AAsf / Asf / BBB+sf
The ratings of classes D and E are constrained by the large obligor
concentration test which limits the class D rating at 'BBBsf' and
the class E rating at 'BB+sf', one notch lower than the model
implied ratings of 'BBB+sf' and 'BBB-sf', respectively. Prepayments
to the loans with the largest obligor exposure, which result in the
notes passing Fitch's concentration test, could lead to positive
rating action for these classes of notes, all else being equal.
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 positions in New Zealand beyond Fitch's baseline
scenario. Available credit enhancement cannot compensate for
higher credit losses and cash flow stresses, all else being
equal.
Downgrade Sensitivity:
-- Notes: A1 / A2 / B / C / D / E
-- Current Rating: AAAsf / AAAsf / AAsf / Asf / BBBsf / BB+sf
Expected impact on note ratings of increased defaults:
-- Increase defaults by 15%: AA+sf / AA+sf / AA-sf / A-sf / BBBsf
/ BBsf
-- Increase defaults by 30%: AA+sf / AA+sf / A+sf / BBB+sf / BBB-
sf / BB-sf
Expected impact on note ratings of decreased recoveries:
-- Reduce recoveries by 15%: AA+sf / AA+sf / A+sf / A-sf / BBBsf
/ BBsf
-- Reduce recoveries by 30%: AAsf / AAsf / Asf / BBB+sf / BB+sf /
B+sf
Expected impact on note ratings of multiple factors:
-- Increase defaults by 15% and reduce recoveries by 15%: AAsf /
AAsf / Asf / BBB+sf / BB+sf / BB-sf
-- Increase defaults by 30% and reduce recoveries by 30%: A+sf /
A+sf / BBB+sf / BBB-sf / BB-sf / 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
Avanti RMBS 2021-1 Trust
Form ABS Due Diligence-15E was not provided to, or reviewed by,
Fitch in relation to this rating action
Fitch sought to receive a third party assessment conducted on the
asset portfolio information, but none was made available for this
transaction.
Fitch conducted a review of a small targeted sample of the
originator's origination files and found the information contained
in the reviewed files to be adequately consistent with the
originator's policies and practices and the other information
provided to the agency about the asset portfolio.
Overall, and together with any assumptions referred to above,
Fitch's assessment of the information relied upon for the agency's
rating analysis according to its applicable rating methodologies
indicates that it 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.
=================
S I N G A P O R E
=================
ENVY GLOBAL: Court Orders 3 Firms Linked to Fraud Scheme Wound Up
-----------------------------------------------------------------
The Straits Times reports that three companies at the centre of one
of Singapore's biggest investment fraud schemes linked to
big-spending businessman Ng Yu Zhi will be wound up and put into
liquidation, the High Court ruled on Aug. 16.
According to the report, High Court Justice Ang Cheng Hock granted
the applications by interim judicial managers led by KPMG partner
Bob Yap to wind up Envy Global Trading (EGT), Envy Asset Management
(EAM) and Envy Management Holdings.
ST relates that the judge also granted the application to discharge
the interim judicial managers and appoint Mr. Yap and KPMG partners
Toh Ai Ling and Roger Tay as liquidators.
This was after Shook Lin & Bok partner David Chan, who is
representing the interim judicial managers-turned-liquidators,
argued that the companies were "insolvent from the very start" and
"the objectives of a judicial management cannot be achieved because
there is no business to preserve," the report relays.
Ng, 34, is accused of having swindled investors into putting at
least SGD1.2 billion into non-existent nickel deals - making his
the first investment fraud case here to hit the billion-dollar
range.
Ng, former managing director of EGT and EAM, faces 31 charges to
date, most of them alleging cheating that took place between
September last year and February this year. Other charges include
fraudulent trading, forgery and criminal breach of trust involving
at least SGD201.2 million.
"The investment scheme was based on non-existent trades,
fraudulently created documents and the promise of big returns.
There is no evidence that the EAM and EGT businesses existed . . .
There were no trades made and hence no investment returns made. The
companies were insolvent from the very start. They didn't generate
any monies and investors were paid from other investors' monies,"
Mr. Chan told the court.
Legal proceedings, including claims against Ng and Ms Lee Si Ye,
deputy managing director of the Envy firms, for all liabilities
incurred by the firms in relation to the nickel trading scheme,
will begin after the High Court ruled to put the firms in
liquidation, The Straits Times understands.
To fund the liquidation process, the liquidators will apply to get
monies released by the Commercial Affairs Department, which has
seized about SGD100 million of assets from Ng, ST understands.
According to ST, Justice Ang asked Mr. Chan about the course of
action to be taken by liquidators to recover the SGD119.7 million
in so-called profits earned by investors from fraudulent
investments with EGT.
ST relates that Mr. Chan said there are "several courses of action
we are considering" but did not elaborate further.
ST says the possibility that they may have to return their gains
arose after KPMG found that "there was no purchase or sale of
physical nickel for the purported nickel trading", and as such
"there were no investment returns".
"The source of such payments could only be the funds paid in by
investors," it found.
The KPMG team's bid to claw back funds is part of efforts to meet
creditors' claims against Ng's companies, adds ST.
The creditors include 522 investors who had lost SGD841.5 million,
of which more than half is alleged to have gone to Ng, ST
discloses.
Ng led a lavish lifestyle with personal monthly expenses of around
SGD2 million, including for private jet flights, butler and
chauffeur services, alcohol, expenditure at nightclubs and upmarket
restaurants, and expenses associated with multiple luxury cars and
"significant monetary gifts to his close associates".
Envy Group is a Singapore-based commodity trader.
SINOPIPE HOLDINGS: KordaMentha Appointed as Liquidators
-------------------------------------------------------
Cameron Duncan and David Dong-Won Kim of KordaMentha on Aug. 10,
2021, were appointed as Provisional Liquidators of Sinopipe
Holdings Limited.
The liquidators may be reached at:
Cameron Duncan
David Dong-Won Kim
KordaMentha Pte Ltd
16 Collyer Quay, #30-01
Singapore 049318
SKIRNER PTE: Creditors' Proofs of Debt Due on Sept. 17
------------------------------------------------------
Creditors of Skirner Pte Ltd, which is in voluntary liquidation,
are required to file their proofs of debt by Sept. 17, 2021, to be
included in the company's dividend distribution.
The company's liquidators are:
Thio Khiaw Ping Kelvin
Chan Li Shan
c/o Ardent Corporate Recovery Pte Ltd
30 Cecil Street #15-08 Prudential Tower
Singapore 049712
===============
T H A I L A N D
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THAI AIRWAYS: Posts THB11.1 Billion Net Loss at 1st Half 2021
-------------------------------------------------------------
Nikkei Asia reports that Thai Airways International reported a net
profit in the first half of 2021, its first since the COVID-19
pandemic hit, thanks to a restructure of its business as part of a
rehabilitation plan, although uncertainty still clouds its
passenger flight services.
According to Nikkei Asia, Thai Airways posted on Aug. 16 a
consolidated net profit of THB11.1 billion (USD333 million),
reversing a THB28 billion it recorded in the same period in the
last year. This was due to contributions to its bottom line from
selling off assets and adjusting employees' benefits.
As of June, the shareholder equity of the airline improved
marginally to minus THB116.4 billion from minus THB128.6 billion,
Nikkei Asia discloses. Its total assets declined by 19%, while
liabilities were reduced by 16%. Although its earnings have
improved, its weak financial position could still hamper the
ability of the airline to make swift investment decisions that will
help it to sustain profitability.
Nikkei Asia says the Stock Exchange of Thailand will exclude Thai
Airways from its main SET index from Aug. 18, as the trading of the
airline's shares has been suspended for more than three months. The
airline fell within the criteria for delisting by the bourse due to
reporting negative shareholder equity in its annual results.
SET President Pakorn Peetathawatchai, however, told Nikkei Asia in
an exclusive interview in June that he would not choose to delist
the national flag carrier as long as it stays on its rehabilitation
course. Keeping it a listed entity would help the airline to
operate in a transparent manner as it would have to report on its
progress, he said.
The airline is under court-supervised rehabilitation. On June 15, a
Thai court formally approved the airline's rehab plan, clearing all
legal hurdles to set the plan in motion.
The company recorded an THB8.6 billion profit from debt
restructuring, Nikkei Asia discloses. The court's approval of the
plan allowed the airline to extend the deadlines for the repayment
of loans and debentures. Penalties for missing repayments from May
to December 2020 were exempted and recorded as an extraordinary
gain in the first half.
The airline also recorded a profit of THB8.3 billion from adjusting
employee benefits. Various welfare programs were reexamined and
executive positions were reduced in the rehabilitation process.
In addition, a profit of THB2 billion was booked from selling off
its assets. Thai Airways raised most of it from selling off its
15.5% stake in Bangkok Aviation Fuel Services to energy company
Ratch Group. It also earned 95 million baht from selling the shares
of budget carrier Nok Air in the secondary market.
Some impairment losses recorded in the past for its fleet were
reversed by THB18.4 billion, Nikkei Asia relays.
Large severance payments, however, weighed on its earnings. As a
part of its rehabilitation, Thai Airways halved its head count from
pre-COVID levels to streamline its reorganization and make it
profitable. Its early retirement program, named "Mutual Separation
Plan," cost the company THB4.8 billion during the first half. Other
severance pay amounted to THB613 million, the report discloses.
Regular flight operations remained subdued, nonetheless. Revenue
from passengers and excess baggage was THB1.8 billion, down 94%
from the same period in the previous year. Freight and mail revenue
fell 24% to THB3.8 billion over the same period.
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.
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.
=============
V I E T N A M
=============
DAT XANH GROUP: Moody's Assigns First Time B2 Corp. Family Rating
-----------------------------------------------------------------
Moody's Investors Service has assigned a corporate family rating of
B2 to Dat Xanh Group Joint Stock Company (DXG), an integrated real
estate company in Vietnam (Ba3 positive), with core businesses
across brokerage, development and construction.
The rating outlook is stable.
This is the first time Moody's has assigned rating to DXG.
RATINGS RATIONALE
"The B2 corporate family rating reflects DXG's integrated real
estate business model, where it has a market leadership position in
the primary brokerage segment and a large land bank that can
support its development business over the decade," says Jacintha
Poh, a Moody's Vice President and Senior Credit Officer.
The rating also reflects DXG's good execution track record and the
favorable fundamentals of Vietnam's residential real estate market,
which will drive strong revenue growth for the company over the
next three years. Nonetheless, DXG is exposed to the cyclical
nature of the real estate market and the evolving regulatory
environment in Vietnam.
"DXG's rating incorporates its aggressive land acquisition
appetite, which we expect will lead to its credit metrics weakening
in 2023, after improving in 2021 and 2022, because of an increase
in debt. Nonetheless, the company is committed to keeping its
debt/EBITDA at less than 3.75x," adds Poh.
The stable rating outlook reflects Moody's expectation that DXG
earnings will increase significantly and the company will manage
its cash flow prudently such that liquidity will remain good over
the next 12-18 months.
DXG is an integrated real estate company in Vietnam, with core
businesses across brokerage, development, and construction, which
are key parts of the real estate ecosystem. This has allowed the
company to capture a wide array of customers, from individual
homebuyers to other real estate developers.
DXG started out as a real estate brokerage company; hence, this
business segment accounted for more than half of the company's
consolidated revenue over the past three years. However, Moody's
expects the proportion of revenue from the brokerage business to
decline over the next 12-18 months, driven by the rapid growth in
DXG's development business. The company's construction business
will remain a small revenue contributor.
DXG operates its brokerage business under 60%-owned Dat Xanh Real
Estate Services Joint Stock Company (DXS), which generates most of
its revenue from primary brokerage services that include the
provision of traditional and full-service brokerage. DXS is the
sole distributor of all projects developed by DXG, but intercompany
sales accounted for only around 20% of DXS' revenue in 2020; the
rest were from non-DXG developments. Moody's expects intercompany
sales to remain around 20% over the next three years.
According to research by various property consultants, DXS has been
the market leader in the primary brokerage segment in Vietnam over
the past three years. In 2020, DXS had around 29% market share,
which was more than double than that of its closest peer.
DXG's development business is largely focused on the residential
real estate market. Over the next three years, the company's
projects will be located in Ho Chi Minh City, Binh Duong and Dong
Nai, targeting homebuyers across the middle to luxury price
segments. As of June 30, 2021, DXG had a total land bank of 2,293
hectares (ha).
Despite the coronavirus pandemic in 2020, DXG recorded contracted
sales of VND3.5 trillion, which was broadly similar to that of
2019. For the first seven months of 2021, the company recorded
contracted sales of around VND5 trillion, which was at around 60%
of Moody's estimate of VND8.3 trillion for 2021.
Given developers in Vietnam adopt a presale strategy for their
projects and recognize revenue only upon handover, the growth in
DXG's contracted sales in 2021 will translate to higher development
revenue in 2022 and 2023. Nearly all of DXG's development revenue
in 2021 are from contracted sales recorded in 2019 and 2020.
Moody's estimates that the contracted sales recorded in the first
seven months of 2021 will account for around 40% of DXG's
development revenue in 2022 and 2023.
Moody's expects DXG's revenue to grow significantly in 2021,
largely driven by the jump in revenue recognition at its
development business. The revenue from its brokerage business will
also increase along with a pickup in new project launches and
activities within Vietnam's real estate market. Consequently, DXG's
credit metrics will improve in 2021 and 2022.
Leverage, as measured by debt/homebuilding EBITDA, will strengthen
to around 3.1x in 2021 and 2.0x in 2022 despite an increase in
debt. In terms of homebuilding EBIT interest coverage, the ratio
will also be above 5.0x in 2021 and 2022. For the 12 months that
ended June 30, 2021, DXG's leverage improved to 2.0x, from 5.0x in
2020, while its homebuilding EBIT interest coverage increased to
4.7x from 1.7x.
However, Moody's expects DXG's credit metrics to weaken in 2023
following its planned acquisition of a 500-ha land parcel. The
company's leverage will increase to around 3.8x and homebuilding
EBIT interest coverage will fall to around 4.5x, but both metrics
will remain within its B2-rating parameters.
Moody's expects DXG's liquidity to be good in 2021 and 2022. As of
June 30, 2021, the company had cash and cash equivalents of VND4.6
trillion compared with total reported debt of VND7 trillion. The
high cash balance was largely driven by proceeds from the listing
of DXS in March 2021, which generated cash inflow of around VND2.2
trillion.
Moody's forecasts DXG will generate around VND3.2 trillion of
operating cash flow in 2021-2022. This amount, together with its
cash balance and around VND4 trillion of proceeds from a planned
share placement at DXG that is to be completed in the last quarter
of this year, will be more than sufficient to cover maturing debt
obligations of around VND2.7 trillion, estimated minority dividend
payment of around VND850 billion and capital spending of around
VND6.2 trillion.
With respect to environmental, social and governance risks, Moody's
considered the complex corporate structure at DXS, where it has
many subsidiaries with large minority interests; hence, there will
be dividend cash leakage to minority shareholders.
Moody's also considered the founder and chairman, Luong Tri Thin's
40% ownership in DXG, and the company's board composition that has
only one independent director out of a five-member board including
the chairman.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATING
DXG's rating is unlikely to be upgraded over the next 12-18 months
given the company's large land acquisition pipeline. However,
positive momentum could emerge if DXG generates strong operating
cash flows to fund its expansion plans, maintains good liquidity
and improves its credit metrics.
Metrics that would support an upgrade include adjusted
debt/homebuilding EBITDA below 3.0x and adjusted homebuilding
EBIT/interest expense above 4.0x on a sustained basis.
Moody's could downgrade DXG's rating if the company fails to
implement its business plans; there is a deterioration in the
property market, leading to protracted weakness in the company's
operations and credit quality; or there is a weakening of DXG's
liquidity. Metrics indicative of a potential downgrade include
adjusted debt/homebuilding EBITDA above 4.0x and adjusted
homebuilding EBIT/ interest expense below 3.0x on a sustained
basis.
The principal methodology used in this rating was Homebuilding And
Property Development Industry published in January 2018.
Dat Xanh Group Joint Stock Company (DXG) is an integrated real
estate company in Vietnam, with core businesses across brokerage,
development, and construction. DXG was established in 2003,
focusing on real estate brokerage, but subsequently expanded into
real estate development in 2007 and construction in 2011. DXG was
listed on the Ho Chi Minh Stock Exchange in 2009. As of June 30,
2021, DXG is 40% owned by the founder and chairman, Luong Tri Thin
and his family.
*********
S U B S C R I P T I O N I N F O R M A T I O N
Troubled Company Reporter-Asia Pacific is a daily newsletter co-
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Marites O. Claro, Joy A. Agravante, Rousel Elaine T. Fernandez,
Julie Anne L. Toledo, Ivy B. Magdadaro and Peter A. Chapman,
Editors.
Copyright 2021. All rights reserved. ISSN: 1520-9482.
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