/raid1/www/Hosts/bankrupt/TCRAP_Public/220114.mbx
T R O U B L E D C O M P A N Y R E P O R T E R
A S I A P A C I F I C
Friday, January 14, 2022, Vol. 25, No. 5
Headlines
A U S T R A L I A
ESO SERVICES: Commences Wind-Up Proceedings
GOOD EDUCATION: Second Creditors' Meeting Set for Jan. 18
LATITUDE AUSTRALIA: Moody's Hikes Class E Notes Rating to Ba1
LIBERTY 2019-1: Moody's Hikes Rating on Class F Notes to Ba1
N. VITETTA: Commences Wind-Up Proceedings
PLATFORM PROPERTIES: First Creditors' Meeting Set for Jan. 24
C H I N A
CHINA MINSHENG: Lent Billions to China Evergrande
FANGDD NETWORK: Faces Delisting Risk on Nasdaq
GREENTOWN CHINA: Moody's Affirms Ba3 CFR, Outlook Stable
LANZHOU CONSTRUCTION: Moody's Cuts CFR to Ba2, Outlook Negative
SUNAC CHINA: Plans to Raise US$580 Million From Share Placement
WEST CHINA CEMENT: Moody's Alters Outlook on Ba2 CFR to Stable
H O N G K O N G
GENTING HONGKONG: Plunges 56% on Fears of More Defaults
I N D I A
AZEEN AGRO: CARE Keeps B+ Debt Rating in Not Cooperating Category
BINDAL COIR: CARE Lowers Rating on INR6.50cr LT Loan to B-
BTS KNITSS: CARE Keeps C Debt Rating in Not Cooperating Category
DHRUV COTEX: CARE Keeps B Debt Rating in Not Cooperating
EASTMAN RECLAMATIONS: CARE Keeps B- Debt Rating in Not Cooperating
EXCEL GENERATORS: CARE Keeps B Debt Rating in Not Cooperating
FUSION BUILDING: CARE Keeps B Debt Rating in Not Cooperating
G K ROOFINGS: CARE Keeps B- Debt Rating in Not Cooperating
GANPATI MEGA: CARE Keeps B+ Debt Rating in Not Cooperating
GOOD MEDIA: CARE Lowers Rating on INR10.58cr LT Loan to B-
HERITAGE DISTILIARIES: CARE Keeps B Debt Rating in Not Cooperating
HINDUSTAN CONSTRUCTION: Defaults on Debt Worth INR2,161cr
J.N. TAYAL: CARE Keeps B Debt Rating in Not Cooperating Category
JAYEM AUTOMOTIVES: CARE Withdraws B+ Rating on Bank Debts
MEENA JEWELLERS: CARE Keeps D Debt Rating in Not Cooperating
MEENA JEWELS: CARE Keeps D Debt Rating in Not Cooperating
NARAYANI STEELS: CARE Keeps D Debt Ratings in Not Cooperating
PARVIN COTEX: CARE Keeps B+ Debt Rating in Not Cooperating
PREMIER BARS: CARE Lowers Rating on INR6.76cr LT Loan to B+
PUNJAB & MAHARASHTRA: NHB Exposure May Get Preferential Treatment
REMIRA MOTORS: CARE Lowers Rating on INR17.11cr LT Loan to B-
SAR SENAPATI: CARE Keeps D Debt Rating in Not Cooperating
SONA DIAMOND: CARE Keeps B- Debt Rating in Not Cooperating
TECH INDIA: CARE Keeps B- Debt Rating in Not Cooperating Category
VASAVI POWER: CARE Keeps D Debt Ratings in Not Cooperating
VATIKA SOVEREIGN: CARE Lowers Rating on INR182.97cr Loan to D
[*] INDIA: LegalPay Partners With Jumbo Finance to Fund CIRP Cases
I N D O N E S I A
SAWIT SUMBERMAS: Moody's Lowers CFR to Caa1, Outlook Negative
N E W Z E A L A N D
MITCHELL CORP: Creditors' Proofs of Debt Due on March 11
PALISADE COMPLIANCE: Creditors' Proofs of Debt Due on Feb. 11
ZAHI'S TEST: Creditors' Proofs of Debt Due on Feb. 28
P H I L I P P I N E S
UNITED PEOPLES: Creditors' Claims Deadline Set for Feb. 8
S I N G A P O R E
CREARE PTE: Creditors' Proofs of Debt Due on Feb. 11
EZRA HOLDINGS: Court to Hear Wind-Up Petition on Jan. 21
SINGAPORE AIRLINES: Raises US$600MM From US Dollar Bond Issue
S R I L A N K A
SRI LANKA: S&P Lowers Sovereign Credit Ratings to 'CCC/C'
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A U S T R A L I A
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ESO SERVICES: Commences Wind-Up Proceedings
-------------------------------------------
Members of ESO Services Pty Ltd, on Jan. 12, 2022, passed a
resolution to voluntarily wind up the company's operations.
The company's liquidator is:
Andrew Juzva
G S Andrews Advisory
22 Drummond Street
Carlton, Victoria
GOOD EDUCATION: Second Creditors' Meeting Set for Jan. 18
---------------------------------------------------------
A second meeting of creditors in the proceedings of Good Education
Group Pty. Ltd. has been set for Jan. 18, 2022, at 2:00 p.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 Jan. 17, 2022, at 4:00 p.m.
Laurence Fitzgerald of William Buck was appointed as administrator
of Good Education on Dec. 3, 2021.
LATITUDE AUSTRALIA: Moody's Hikes Class E Notes Rating to Ba1
-------------------------------------------------------------
Moody's Investors Service has upgraded the ratings on four classes
of notes issued by Latitude Australia Personal Loans Series 2020-1
Trust.
The affected ratings are as follows:
Issuer: Latitude Australia Personal Loans Series 2020-1 Trust
Class B Notes, Upgraded to Aaa (sf); previously on Mar 12, 2021
Upgraded to Aa1 (sf)
Class C Notes, Upgraded to Aa2 (sf); previously on Mar 12, 2021
Upgraded to Aa3 (sf)
Class D Notes, Upgraded to A3 (sf); previously on Mar 12, 2021
Upgraded to Baa1 (sf)
Class E Notes, Upgraded to Ba1 (sf); previously on Aug 26, 2020
Confirmed at Ba2 (sf)
RATINGS RATIONALE
The upgrades were prompted by an increase in note subordination
available to the affected notes and performance of the collateral
pool to date.
Following the December 2021 payment, note subordination available
for the Class B, Class C and Class D Notes has increased to 37.9%,
28.2%, and 20.9%, respectively, from 35.2%, 26.1%, and 19.3% at the
time of the last rating action for these notes in March 2021. Note
subordination available for the Class E has increased to 9.7% from
6.7% at the time of the last rating action for these notes in
August 2020.
As of November 2021, 1.7% of the outstanding pool was 30-plus day
delinquent and 0.2% was 90-plus day delinquent. The deal has
incurred 2.8% of loss to date, which have been covered by excess
spread.
Based on the observed performance to date and loan attributes,
Moody's has lowered its expected default assumption for the
outstanding pool to 9.7% from 11.4% as of the last rating action in
March 2021. Moody's also lowered the Aaa portfolio credit
enhancement to 38% from 42%.
The transaction is a cash securitization of unsecured personal
loans extended to obligors located in Australia. All receivables
were originated by Latitude Personal Finance Pty Limited.
Factors that would lead to an upgrade or downgrade of the ratings:
Factors that could lead to an upgrade of the ratings include (1)
performance of the underlying collateral that is better than
Moody's expectations, and (2) an increase in credit enhancement
available for the notes.
Factors that could lead to a downgrade of the ratings include (1)
performance of the underlying collateral that is worse than Moody's
expectations, (2) a decrease in credit enhancement available for
the notes, and (3) a deterioration in the credit quality of the
transaction counterparties.
LIBERTY 2019-1: Moody's Hikes Rating on Class F Notes to Ba1
------------------------------------------------------------
Moody's Investors Service has upgraded the ratings on three classes
of notes issued by Liberty Series 2019-1 SME.
The affected ratings are as follows:
Issuer: Liberty Series 2019-1 SME
Class D Notes, Upgraded to Aa2 (sf); previously on Jun 17, 2021
Upgraded to A1 (sf)
Class E Notes, Upgraded to A3 (sf); previously on Jun 17, 2021
Upgraded to Baa2 (sf)
Class F Notes, Upgraded to Ba1 (sf); previously on Jun 17, 2021
Upgraded to Ba2 (sf)
RATINGS RATIONALE
The upgrades were prompted by an increase in credit enhancement
available for the affected notes and good collateral performance to
date.
Following the November 2021 payment date, note subordination
available for the Class D, Class E and Class F Notes has increased
to 8.5%, 5.2% and 2.5% respectively, from 7.7%, 4.6% and 2.2% at
the time of the last rating action for these notes in June 2021.
The Guarantee Fee Reserve Account, fully funded at AUD2.75 million,
provides additional credit support of 0.7% of the current note
balance.
As of November 2021, 1.1% of the outstanding pool was 30-plus day
delinquent and 0.8% was 90-plus day delinquent. The deal has
incurred no losses to date. The proportion of bullet loans, which
rely on either refinancing or sale of the underlying property to
repay the loan at maturity, has decreased to 1.6% from 2.2% at the
time of the last rating action in June 2021. The proportion of the
portfolio categorised into the SME sub-pool has remained at 26%.
Based on the observed performance to date and loan attributes,
Moody's has lowered its expected loss assumption to 2% of the
outstanding pool from 2.1% of the outstanding pool at the time of
the rating action in June 2021.
The transaction is a securitisation of loans to self-managed
superfunds, small-to-medium enterprises and individuals, originated
by Liberty Financial Pty Ltd, an Australian non-bank lender. The
loans are secured by residential or commercial properties, or a mix
of both. A portion of the portfolio consists of loans extended to
borrowers with impaired credit histories or made on a limited
documentation basis, or no documentation basis.
Due to the mixed nature of the pools, Moody's has categorised the
portfolio into separate residential loan and SME sub-pools in its
analysis.
Factors that would lead to an upgrade or downgrade of the ratings:
Factors that could lead to an upgrade of the ratings include (1)
performance of the underlying collateral that is better than
Moody's expectations, and (2) an increase in credit enhancement
available for the notes.
Factors that could lead to a downgrade of the ratings include (1)
performance of the underlying collateral that is worse than Moody's
expectations, (2) a decrease in credit enhancement available for
the notes, and (3) a deterioration in the credit quality of the
transaction counterparties.
N. VITETTA: Commences Wind-Up Proceedings
-----------------------------------------
Members of N. Vitetta Proprietary Limited, on Jan. 12, 2022, passed
a resolution to voluntarily wind up the company's operations.
The company's liquidator is:
Shane Justin Cremin
Rodgers Reidy
Level 3, 326 William Street
Melbourne, Victoria
PLATFORM PROPERTIES: First Creditors' Meeting Set for Jan. 24
-------------------------------------------------------------
A first meeting of the creditors in the proceedings of Platform
Properties Pty Ltd will be held on Jan. 24, 2022, at 10:00 a.m. at
the offices of McLeod & Partners, Level 9, 300 Adelaide Street, in
Brisbane, Queensland.
Jonathan Paul McLeod and Bill Karageozis of McLeod & Partners were
appointed as administrators of Platform Properties on Jan. 12,
2022.
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C H I N A
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CHINA MINSHENG: Lent Billions to China Evergrande
-------------------------------------------------
Bloomberg News reports that China Minsheng Banking Corp was once
hailed as the future of Chinese banking, a privately run lender
that would mint money by outmaneuvering its state-owned rivals.
The report notes that an ill-fated push into property lending has
instead turned China Minsheng into one of the biggest casualties of
the real estate debt crisis that's roiling Asia's largest economy.
Battered by mounting losses on loans to developers including China
Evergrande Group, Minsheng's stock tumbled 31% in the 12 months
through last week - the worst performance in the 155-member
Bloomberg World Banks Index. Hedge funds and other short sellers
are more bearish on the lender than any of its global peers.
According to Bloomberg, people familiar with Minsheng's operations
said the bank, founded in 1996 as China's first non-state
controlled lender, is now in damage control mode. It has
restructured its real estate finance group to give more power to
local branch managers, made reducing holdings of property debt a
top priority for 2022 and plans to cut salaries for some staff by
half, the people said, asking not to be named discussing private
information.
Bloomberg relates that Minsheng's plight underscores the widening
fallout from Chinese President Xi Jinping's crackdown on the
property industry and other parts of the country's capital-hungry
private sector. It also offers a warning to global financial firms
that are investing billions of dollars to expand in China: Bets
that seem like sure things can quickly sour when the nation's
policy makers decide to change course.
Minsheng has about CNY130 billion (US$20 billion) of exposure to
high-risk developers, amounting to 27% of its so-called tier-1
capital, the most among big Chinese lenders, Citigroup Inc.
analysts estimated in a September research report, Bloomberg
relays. The bank will need years to work through its bad debt
problem and a capital injection from a stronger rival can't be
ruled out, said Shen Meng, director at Chanson & Co., a
Beijing-based boutique investment bank.
The pursuit of high growth and returns to its private shareholders
pushed the bank to take on lots of high-risk investments," Shen
said.
Minsheng said in a response to questions from Bloomberg that it
completed a restructuring of its real estate finance unit at the
end of 2020, transferring some functions to local branches.
Employee compensation is largely stable, the bank added.
Chairman Gao Yingxin, who joined Minsheng from Bank of China in
2020, pledged to address the lender's challenges at a shareholders'
meeting in June, Bloomberg recalls. "Ten years ago we were the
pearl on the crown, but now our gap with peers is widening,"
Bloomberg quotes Mr. Gao as saying. "Corporate governance will
switch from short-sightedness to long-termism."
This isn't the first time Minsheng has faced a reckoning after a
period of rapid growth, the report notes. In 2009, Dong Wenbiao,
who helped found Minsheng alongside other wealthy Chinese
businessmen including pig-feed tycoon Liu Yonghao and property
mogul Lu Zhiqiang, orchestrated the bank's push into steel-industry
lending as part of a goal to become the most profitable bank in
China, recalls Bloomberg. While Minsheng's earnings surged at an
annual rate of nearly 50% over the next five years, a steel sector
downturn ultimately led to a pile-up of bad loans and Mr. Dong left
the bank in 2014.
More pain is all but guaranteed, Bloomberg states. The bank is one
of the biggest creditors to Evergrande, whose debt crisis has
rattled global markets over the past year and sparked financial
contagion across China's property industry. Minsheng had about
CNY29 billion of exposure to Evergrande as of June 2020, Bloomberg
discloses citing a letter the developer sent to provincial
authorities that year.
Minsheng said in September that its loans to Evergrande had dropped
by about 15% since June 2020, without specifying a level. When
taking into account the bank's indirect lending to Evergrande
through trust products, Minsheng's exposure to the developer
exceeds CNY29 billion, people familiar with the matter said,
without providing a specific figure.
Minsheng said in its response to queries from Bloomberg that its
loans to Evergrande are all tied to residential projects, with
sufficient collateral including land, properties and projects under
construction. The bank said it hasn't invested in Evergrande bonds
or cooperated through wealth management products or funds.
About China Minsheng
Based in Beijing, China, China Minsheng Banking Corporation Ltd.'s
mainly provides commercial banking services that include absorbing
public deposits, providing short term, medium term, and long term
loans, making domestic and international settlement, discounting
bills and issuing financial bonds.
As reported in the Troubled Company Reporter-Asia Pacific on Sept.
3, 2021, Fitch Ratings has affirmed China Minsheng Banking Corp.,
Ltd.'s (CMBC) Long-Term Foreign-Currency Issuer Default Rating
(IDR) at 'BB+' and assigned a Short-Term IDR of 'B'. The Outlook on
the Long-Term IDR is Stable. At the same time, Fitch has affirmed
CMBC's Viability Rating (VR) at 'b'.
FANGDD NETWORK: Faces Delisting Risk on Nasdaq
----------------------------------------------
AIM Group reports that Fangdd Network Group Ltd. may be forced to
delist from Nasdaq as the company's ADS closed below $1 per share
for 30 consecutive business days, according to the company's filing
on Jan. 7.
In the filing, FangDD notes that it received notice from Nasdaq on
Jan. 4 that it was not compliant with the minimum bid price
requirement under Nasdaq listing rules, the report relates. The
company has been granted a grace period of 180 calendar days, which
expires on July 5, to regain compliance.
FangDD's 3Q 2021 results, released in November, reveal that the
company's revenue was down by 57.8% while its net loss widened to
$55.1 million, the report discloses. Since then, its share price
has almost halved. Its ADS closed at $0.372 per share on Jan. 7.
According to AIM Group, real estate marketplaces in China have
taken a hit as the property market has been going through a
difficult time amid the government's intervention to stabilize
housing prices and curb speculation. It remains a challenge for
FangDD to regain compliance in the coming months, the report says.
Fangdd Network Group Ltd. operates as an online real estate
marketplace in the People's Republic of China. The company operates
Duoduo Sales for real estate agents to access primary and other
property listings, large real estate buyer base, and marketplace
products and services, such as shared listings, data analytic
tools, premium marketplace functions, and AI-based marketplace
assistance, as well as evaluate online business performances; and
Duoduo Cloud Agency that provides a suite of tools and services to
agencies manage their business and agents. It also operates
Fangduoduo, which offers primary and secondary listings, vacation
properties, and real estate market news and pricing information
services; Property Cloud, a SaaS solution for real estate
developers for listing properties, publishing commission rates, and
setting other terms in connection with the sale; and www.fangdd.com
that offers real estate agents and real estate buyers
region-specific real estate news, information, property data, and
access to shared-interest online communities.
GREENTOWN CHINA: Moody's Affirms Ba3 CFR, Outlook Stable
--------------------------------------------------------
Moody's Investors Service has affirmed Greentown China Holdings
Limited's Ba3 corporate family rating (CFR) and senior unsecured
rating.
The rating outlook remains stable.
"The rating affirmation reflects our expectation that Greentown
will maintain its stable credit quality, adequate liquidity and
access to funding over the next 6-12 months," says Daniel Zhou, a
Moody's Analyst.
"We also expect the company to maintain its close linkage with, and
receive strong support from, its largest shareholder, China
Communications Construction Group (Limited) (CCCG)," adds Zhou.
RATINGS RATIONALE
Greentown's Ba3 CFR incorporates the company's standalone credit
strength and a two-notch uplift based on Moody's expectation that
the company will receive support from CCCG in times of financial
distress.
Greentown's standalone credit strength reflects its
well-established market position and long operating record in
property development in Hangzhou city and Zhejiang province, its
good brand name, high-quality products and adequate liquidity.
However, the company's standalone credit strength also considers
its high debt leverage and significant exposure to its joint
ventures (JVs).
The two-notch uplift reflects Moody's assessment that CCCG will
support Greentown when needed, given CCCG's status as Greentown's
largest shareholder, its significant influence on Greentown and
track record of providing financial support to Greentown's offshore
bond issuances. This view also factors in CCCG's strong ability to
provide support, underpinned by its status as a large-scale
state-owned enterprise (SOE) under the central government and its
good access to funding.
Greentown's gross contracted sales rose 24% to RMB267 billion in
2021, driven by strong sales in the first half of 2021 and its
quality land bank in tier 1 and tier 2 cities. This performance
surpassed that of many of Greentown's peers in China. Moody's
forecasts Greentown's gross contracted sales will moderate to
RMB245 billion-RMB255 billion in 2022 as operating conditions in
China's property market remain challenging over the next 6-12
months.
Nevertheless, Moody's expects Greentown's liquidity position to
remain stable and supportive of the company's standalone credit
strength. The rating agency expects Greentown's cash holdings,
together with its operating cash flow, to cover its maturing debt,
committed land premiums and dividends over the next 12-18 months.
Greentown's leverage, as measured by revenue/adjusted debt, will
improve slightly to 43%-47% over the next 12-18 months from 42.2%
for the 12 months ended 30 June 2021. This expectation is driven by
an increase in revenue recognition from the company's strong
contracted sales over the past two to three years, as well as its
debt reduction amid slowing land acquisitions and a tight credit
environment.
Meanwhile, Greentown's interest coverage, as measured by
EBIT/interest, will remain largely flat at around 2.0x over the
same period, compared with 2.1x for the 12 months ended 30 June
2021. The effect of revenue growth will largely be offset by a
contraction in profit margin due to increased land costs and
pricing pressure amid difficult market conditions. The projected
financial profile supports the company's standalone credit
profile.
Greentown's senior unsecured bond rating is not affected by
subordination to claims at the operating company level. Despite
Greentown's status as a holding company, Moody's expects support
from CCCG to Greentown to flow through the holding company rather
than directly to its main operating companies, mitigating potential
differences in expected losses that could arise from structural
subordination.
In terms of environmental, social and governance (ESG) factors,
Moody's considers the presence of strong shareholders; the
disclosure of significant related-party transactions as required by
the Corporate Governance Code for companies listed on the Hong Kong
Exchange; and the presence of four independent nonexecutive
directors on Greentown's 12-member board as well as three special
committees (including audit, remuneration and nomination
committees) that are chaired by independent nonexecutive
directors.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS
The stable rating outlook reflects Moody's expectation that
Greentown will maintain stable financial metrics and adequate
liquidity over the next 12-18 months. In addition, the outlook
reflects Moody's expectation that the likelihood of the company
receiving support from CCCG in times of need will remain
unchanged.
Moody's could upgrade Greentown's rating if the company
demonstrates resilience in sales and strong financial discipline,
as well as strengthens its financial position. Specifically,
Moody's could upgrade the ratings if Greentown's revenue/adjusted
debt exceeds 50%-55% and its EBIT/interest rises above 2.0x-2.5x,
both on a sustained basis.
A significant reduction in the contingent liabilities associated
with Greentown's JVs, or a lower risk of providing funding support
to the JVs could also be credit positive.
Moody's could downgrade the ratings if Greentown's sales reduce or
it aggressively grows its business such that its credit metrics and
liquidity weaken. Specifically, Moody's could downgrade the ratings
if Greentown's EBIT/interest falls below 1.5x or its
revenue/adjusted debt drops below 40% on a sustained basis; or if
its liquidity deteriorates, as reflected by its unrestricted
cash/short-term debt declining below 1.0x.
Any sign of weakening support from, or reduced ownership by, CCCG
will also be negative to Greentown's ratings.
Moody's could also downgrade the rating if the contingent
liabilities associated with the company's JVs or the risk of
providing funding support to the JVs increases significantly.
Greentown is one of the main property developers in China, focused
on Hangzhou city and Zhejiang province. As of 30 June 2021, the
company had 251 projects with a total gross floor area of 60.3
million square meters (sqm), with 35.0 million sqm attributable to
the company.
Greentown listed on the Hong Kong Exchange in July 2006. CCCG is
Greentown's largest shareholder, with a 27.95% equity stake as of
December 31, 2021.
LANZHOU CONSTRUCTION: Moody's Cuts CFR to Ba2, Outlook Negative
---------------------------------------------------------------
Moody's Investors Service has downgraded to Ba2 from Ba1 the
corporate family rating (CFR) of Lanzhou Construction Investment
(Holding) Group Co., Ltd. (Lanzhou Construction) and the senior
unsecured rating on the bonds issued by City Development Company of
Lan Zhou and guaranteed by Lanzhou Construction.
The ratings outlook remains negative.
"The downgrade reflects Moody's assessment that the Lanzhou city
government's capacity to support its local government financing
vehicles (LGFVs) is weaker than earlier estimated, reflecting
greater constraints from a relatively weak local financial sector
with limited financial resources, amid our expectation of slowing
growth in the provincial economy and property market in 2022," says
Ying Wang, a Moody's Vice President and Senior Analyst.
The negative outlook reflects the uncertainty around the company's
ability to strengthen its funding access and liquidity profile in
the next 12 months.
RATINGS RATIONALE
The weakening of the Lanzhou city government's capacity to support
(GCS), as indicated by a lowering of its GCS score to baa3 from
baa2, mainly reflects Moody's expectation that the city's
relatively weak economic fundamentals will weaken in the near term
as China's economy decelerates due to a correction in the property
sector, and in the longer term as the country's growth rate slows
mainly due to demographic changes. Weak growth will pressure
Lanzhou's fiscal profile, given its low capacity for generating tax
revenues and high reliance on net transfers from the central
government. In addition, Lanzhou's land sales revenue has been
volatile and will likely weaken further in the near term, creating
further challenges to fiscal performance. Moreover, a weak economy
will place constraints on Lanzhou's financial sector, which is
already weak compared with other regions in China.
The funding environment in northwest China has deteriorated
recently due to rising investor risk aversion and an overall
tightening of the credit environment in 2021. A relatively weak
local financial sector with limited financial resources constrains
the Lanzhou government's ability to coordinate with financial
institutions to provide timely liquidity support to its LGFVs, to a
greater extent than earlier estimated.
Lanzhou Construction faces sizable maturing debts, including around
RMB16 billion in bonds that will come due over the next 12 months.
Given its weak funding access, Moody's expects that Lanzhou
Construction will need to rely on government support to meet its
funding needs.
Moody's believes the Lanzhou city government and the Gansu
provincial government have strong willingness to support Lanzhou
Construction's liquidity needs, given that the company is the
dominant LGFV in Lanzhou city that provides essential public
services and develops public infrastructure projects. The company
also accounted for most of the outstanding onshore bonds issued by
state-owned enterprises (SOEs) in Lanzhou city.
Support measures provided to the company include state-owned assets
and land injections from the government, negotiations with
financial institutions under coordination from the government, and
an emergency fund set up by the government to provide liquidity
support. While these measures can help Lanzhou Construction repay
its maturing bonds, it is unclear if they can adequately improve
investors' and banks' confidence in the company to help it
refinance its maturing debts with long-term bank loans or bonds.
This uncertainty is the key reason for the negative outlook on the
rating.
Lanzhou Construction's Ba2 rating is based on the Lanzhou city
government's GCS score of baa3 and Moody's assessment of how the
company's characteristics affect the Lanzhou city government's
propensity to support, which results in a two-notch downward
adjustment.
Moody's assessment of Lanzhou's GCS reflects Lanzhou city's status
as the capital of Gansu province, the city's relatively weak
economic and fiscal metrics, the constraints faced by its local
financial sector, and the limited disclosure requirements for local
SOEs, which prevent a complete assessment of the contingent
liability risks that could affect the city's capacity to provide
support.
The Ba2 rating also reflects the Lanzhou city government's
propensity to support Lanzhou Construction because of its 100%
ownership of the company, the company's status as the dominant LGFV
that provides essential public services in the city, and its track
record of receiving government cash payments.
However, the two-notch downward adjustment from the Lanzhou
government's GCS score reflects Lanzhou Construction's weak funding
access, large debt obligation arising from its public-policy
projects and the contingent risk arising from the external
guarantees it has provided to other companies.
Lanzhou Construction's rating also considers the following
environmental, social and governance (ESG) factors.
The company bears high social risks as it implements public-policy
initiatives by building public infrastructure in Lanzhou.
Demographic changes, public awareness and social priorities shape
the company's development targets and ultimately affect the Lanzhou
city government's propensity to support the company.
As for governance considerations, Lanzhou Construction is subject
to oversight by the Lanzhou city government and has to meet several
reporting requirements, reflecting its public-policy role and
status as a government-owned entity.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS
Moody's could downgrade the rating if Lanzhou Construction fails to
receive sufficient support from the government to meet its funding
needs, or if its access to funding further deteriorates, thereby
further weakening its liquidity profile.
The rating could also be downgraded if the Lanzhou city
government's propensity to support weakens because of changes in
Lanzhou Construction's characteristics, such as (1) a decline in
the company's position as the dominant public service provider in
Lanzhou city; (2) a substantial expansion of its commercial
activities at the cost of its public service functionalities, which
changes its core business, or substantial losses by its commercial
businesses; or (3) its debt and leverage rapidly increase, with
fewer corresponding government payments.
Given that Lanzhou Construction's rating is based on the Lanzhou
city government's GCS score, Moody's could downgrade the rating if
(1) China's sovereign rating is downgraded, or (2) the Lanzhou city
government's capacity to support weakens, which could arise from a
material worsening of Lanzhou's economic or financial profile or
its ability to coordinate timely support. Changes in the Chinese
government's policies that prohibit regional and local governments
from supporting their LGFVs will also affect the rating.
An upgrade of the ratings is unlikely, given the negative outlook.
However, Moody's could revise the outlook to stable if Lanzhou
Construction strengthens its funding access and liquidity profile.
Established in 2016, Lanzhou Construction Investment (Holding)
Group Co., Ltd. is 100% owned by the Lanzhou State-owned Asset
Supervision and Administration Commission through a parent
intermediary, Lanzhou Investment (Holdings) Group Co., Ltd. The
company mainly engages in urban infrastructure construction,
shantytown redevelopment, utilities, public services and
transportation in Lanzhou city.
SUNAC CHINA: Plans to Raise US$580 Million From Share Placement
---------------------------------------------------------------
South China Morning Post reports that Sunac China Holdings slumped
after it announced a HK$4.52 billion (US$580 million) share
placement, as the mainland's third largest developer tries to
ring-fence itself from the debt crisis surrounding Chinese property
companies.
The Post relates that the Hong Kong-listed company will place 452
million shares at HK$10 per share, representing 9.1% of its
existing share capital. Half of the proceeds will be used repay
loans, it said.
According to the report, Sunac's move comes as investors are
closely watching developers' ability to service debt after China
Evergrande Group, Kaisa Group Holdings and a few others have
defaulted on their bond payments. Investors expect debt payment
failures by Chinese developers to continue to rise this year.
Average home prices are forecast to fall 1% in the first six months
this year, according to 14 analysts and economists surveyed by
Reuters late last year, the Post relays.
The Post says Chinese developers have bore the brunt of Beijing's
tight property policies to curb speculation in the market, with the
"three red lines" thresholds on borrowings pushing them to the
brink. As a result, companies have resorted to taking various
measures to raise funds, including assets disposals, sales of
stakes in subsidiaries and share placements.
There are also rumours that Sunac, one of China's most heavily
indebted property developers, may have defaulted on a wealth
management product, the Post says.
According to the Post, Sunac's share replacement was aimed to
counter short-term uncertainties in the market based on prudent
caution, a source close to the company said, adding that it has
sufficient cash to pay its upcoming short-term debt maturities.
"After this share replacement, the company has no near-team plan to
sell more equity in itself or pare some of its stake in unit Sunac
Services Holdings," the source added.
The Post says the Beijing-based company's shares and bonds had
already slumped on Jan. 12, after its stakes in at least two
companies were frozen by a court in Shenzhen.
The company has also been included in a list of 11 developers by
the People's Bank of China that need liquidity support, the Post
discloses citing financial information provider Redd Intelligence.
Sunac said the other half of the funds raised from the share
placement will be used for general corporate purposes and to
"further enlarge the company's shareholder base and optimise the
capital structure".
After the share placement, which will close around January 17,
public shareholders' stake in the company will drop to 51.92% from
56.62 per cent, the report adds.
About Sunac China
Sunac China Holdings Limited (SEHK:1918) --
http://www.sunac.com.cn/-- is principally engaged in the sales of
properties in the People's Republic of China. The Company operates
its business through two segments: Property Development and
Property Management and Others. The Company's subsidiaries include
Sunac Real Estate Investment Holdings Ltd., Qiwei Real Estate
Investment Holdings Ltd. and Yingzi Real Estate Investment Holdings
Ltd.
As reported in the Troubled Company Reporter-Asia Pacific on Nov.
12, 2021, Fitch Ratings has revised the Outlook on homebuilder
Sunac China Holdings Limited to Stable, from Positive, and has
affirmed its Long-Term Foreign-Currency Issuer Default Rating
(IDR), senior unsecured rating and the ratings on its outstanding
senior notes at 'BB'. Fitch has removed all the ratings from Under
Criteria Observation (UCO), on which they were placed on October
20, 2021, following the publication of its updated Corporate Rating
Criteria.
The Outlook revision is driven by the company's declining
contracted sales and sales collection since August 2021, in line
with the overall industry, which may weaken its liquidity in the
short term. Nonetheless, Sunac faces less refinancing pressure than
some homebuilders in the 'BB' rating category, and its business and
financial profile is comparable with that of 'BB' peers.
WEST CHINA CEMENT: Moody's Alters Outlook on Ba2 CFR to Stable
--------------------------------------------------------------
Moody's Investors Service has affirmed West China Cement Limited's
(WCC) Ba2 corporate family rating (CFR) and senior unsecured
rating.
At the same time, Moody's has revised the rating outlook to stable
from positive.
"The outlook change to stable reflects our expectation that WCC's
expansion strategy in Africa will elevate its leverage over the
next 12-18 months beyond our earlier forecast, amid business
volatility during its execution," says Roy Zhang, a Moody's Vice
President and Senior Analyst.
"The risks are balanced by the company's healthy cash flow
generation from the domestic market and adequate liquidity. WCC
will likely maintain its strong liquidity and moderate leverage, as
measured by debt to EBITDA, below 3x over the next 12-18 months.
This leverage level is in line with its rating category, and hence
the rating affirmation at Ba2," adds Zhang.
RATINGS RATIONALE
WCC's Ba2 CFR reflects the company's dominant market share in
cement production in central and southern Shaanxi Province.
The rating also considers WCC's business synergies with Anhui Conch
Cement Company Limited (Anhui Conch, A2 stable). Anhui Conch has
increased its shareholding in WCC to 27.1% as of the end of 2021,
from 21.1% as of the end of 2020.
At the same time, WCC's rating is constrained by the cyclical
nature of the cement industry, the execution risks in its
expansion, its developing operating scale, and limited
diversification in terms of product and market coverage.
These risks are partially tempered by favorable industry conditions
in WCC's markets, where cement supply is constrained due to
regulatory and environmental factors. Such restrictions help
balance the supply and demand for cement, supporting high cement
prices.
WCC's expansion strategy in the African market, if executed
successfully, will improve the company's business profile, in terms
of operating scale and market diversification. However, the
strategy requires significant investment and carries execution
risks.
Moody's expects WCC to prudently manage its balance sheet by
funding the project with a pre-funded USD bond issuance and
internal cash flow, such that the expansion will not have a
material impact on the company's leverage and liquidity.
Nevertheless, given the high business volatility facing its African
projects and moderating domestic demand, Moody's expects company's
leverage will likely not stay below 2.0x over the next 12-18
months, resulting in the rating agency's decision to revise the
outlook to stable.
WCC's liquidity is good. The company had cash and cash-like sources
of about RMB1.9 billion as of the end June 2021. This, together
with its strong operating cash flow and USD bond issuance, is
sufficient to cover its debt maturities and planned capital
expenditure over the next 12-18 months.
The senior unsecured bond rating on the proposed USD notes is
unaffected by structural subordination due to claims at the
operating company level. This is because, despite its status as a
holding company with a majority of claims at the operating
subsidiaries, WCC's creditors benefit from the group's highly
diversified business profile, with cash flow generation across a
large number of operating subsidiaries in different parts of China
and overseas, and which mitigates structural subordination risk.
WCC's CFR also considers the following environmental, social and
governance (ESG) risks.
Globally, the building materials sector has elevated credit
exposure to environmental risks, which could be significant for
WCC's credit quality in the next three to five years. China's
cement sector is a major contributor to the country's carbon
emissions and a major emitter of sulfur dioxide, nitrogen oxides
and dust. The mining and manufacturing processes for cement
production is energy intensive, given their large consumption of
coal, electricity and water.
WCC has upgraded its production lines to meet higher emission
standards, and has implemented measures to increase energy
efficiency and reduce dust and carbon emissions. As the local
industry leader, WCC continues to invest in equipment and processes
to manage the environmental risks. The company will benefit from
tightened environmental standards in China as the cement industry
consolidates.
In terms of corporate governance, the company was 32.3% owned by
its founder and chairman, Zhang Jimin, as of the end of 2021. This
concentrated shareholding risk is partially tempered by WCC's
listing status and the fact that Anhui Conch, which held a 27.1%
stake in the company as of the end of 2021, has two seats on its
board.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS
The stable rating outlook reflects Moody's expectation that WCC
will continue to generate healthy cash flow and maintain prudent
financial management and adequate liquidity.
Moody's could upgrade WCC's rating if the company increases its
scale and geographic diversification; and maintains a sound capital
structure, such that its debt/EBITDA stays below 2.0x, and adequate
liquidity to cover its refinancing, expansion and shareholder
distribution.
On the other hand, downward rating pressure could emerge if WCC's
financial and/or liquidity position weaken because of falling
revenue, rising costs, aggressive acquisitions or unexpected
shareholder distributions.
Financial indicators of a rating downgrade include debt/EBITDA
exceeding 3.0x-3.5x or adjusted debt/capitalization exceeding 50%
on a sustained basis.
West China Cement Limited (WCC) is one of the leading cement
producers by capacity in China's Shaanxi Province. As of the end
2020, the company's annual capacity was 33.2 million tons. Most of
WCC's plants are located in central and southern Shaanxi Province.
As of the end of 2020, the company was 32.3% owned by its founder
and chairman, Zhang Jimin, and 21.1% owned by Anhui Conch Cement
Company Limited (Anhui Conch). WCC was listed on the Hong Kong
Stock Exchange in August 2010.
=================
H O N G K O N G
=================
GENTING HONGKONG: Plunges 56% on Fears of More Defaults
-------------------------------------------------------
Bloomberg News reports that troubled cruise operator Genting Hong
Kong plunged by a record 56% after shares resumed trading in Hong
Kong, as the company said it was unable to guarantee that it could
meet its financial obligations.
Legal proceedings involving an US$88 million loan facility related
to its German shipbuilding unit are still pending a German court
ruling set for Jan. 17, Genting said in a filing to the Hong Kong
stock exchange on Jan. 13, Bloomberg relays.
The outcome will be crucial to the company's ability to weather its
current debt crisis, it added.
According to Bloomberg, the indirect wholly owned subsidiary MV
Werften filed for insolvency on Jan. 10 at a local court in
Germany, as salvage talks between the local governments and the
firm came to a dead end. Genting warned investors that cross
defaults amounting to US$2.78 billion may follow.
Bloomberg says Genting has been embroiled in a dispute with German
federal and local governments, as both parties blamed the other for
MV Werften's collapse and the potential loss of 1,900 jobs.
Bloomberg relates that the cruise operator's financial health
deteriorated rapidly after the Covid-19 pandemic prompted a string
of restrictions that has led to restructurings and insolvencies at
travel industry companies around the world.
Genting Hong Kong halted debt payments to creditors totalling
US$3.4 billion in August 2020 and was in default of that amount as
at Dec. 31 that year, Bloomberg notes. The firm, which has offered
"seacations" amid a global cruise-to-nowhere trend, reported a
record loss of US$1.7 billion last May.
Bloomberg adds that Genting Hong Kong said that as at the time of
its filing on Jan. 13, it has not received notice from creditors
demanding repayment or commencing action against the company
related to their financial arrangements. It is unclear whether any
of the relevant creditors will choose to do so, it added.
About Genting Hong Kong
Genting Hong Kong Limited is a Hong Kong-based investment holding
company principally engaged in cruise businesses. The Company
operates through two segments. Cruise and Cruise-related Activities
segment is engaged in the sales of passenger tickets, the sales of
foods and beverages onboard, shore excursion, as well as the
provision of onboard entertainment and other onboard services.
Non-cruise Activities segment is engaged in onshore hotel
businesses, travel agency, aviation businesses, entertainment
businesses and shipyard businesses, among others. The Company
operates businesses in Asia Pacific, North America and Europe,
among others.
=========
I N D I A
=========
AZEEN AGRO: CARE Keeps B+ Debt Rating in Not Cooperating Category
-----------------------------------------------------------------
CARE Ratings said the rating for the bank facilities of Azeen Agro
Private Limited (AAPL) continues to remain in the 'Issuer Not
Cooperating ' category.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long Term Bank 9.37 CARE B+; Stable; ISSUER NOT
Facilities COOPERATING; Rating continues
To remain under ISSUER NOT
COOPERATING category
Long Term/ 5.01 CARE B+; Stable/CARE A4;
Short Term ISSUER NOT COOPERATING;
Bank Facilities Rating continues to remain
under ISSUER NOT COOPERATING
category
Detailed Rationale & Key Rating Drivers
CARE had, vide its press release dated December 3, 2020, placed the
rating(s) of AAPL under the 'issuer non-cooperating' category as
AAPL had failed to provide information for monitoring of the rating
and had not paid the surveillance fees for the rating exercise as
agreed to in its Rating Agreement. AAPL continues to be
non-cooperative despite repeated requests for submission of
information through e-mails, phone calls and a letter/email dated
October 19, 2021, October 29, 2021, November 8, 2021.
In line with the extant SEBI guidelines, CARE has reviewed the
rating on the basis of the best available information which
however, in CARE's opinion is not sufficient to arrive at a fair
rating.
Users of this rating (including investors, lenders and the public
at large) are hence requested to exercise caution while using the
above rating(s).
Ahmedabad (Gujarat) based AAPL is private limited company
established in July 2013 by Mr. Dilawar Vhora and Mr. Tarikahmed
Vhora. The company is engaged in cotton ginning and oil milling to
produce cotton bales and cotton seeds and also trading of raw
cotton. The manufacturing unit of the firm is located at Ahmedabad
(Gujarat) and operates with an installed capacity of 500 bales per
day as on March 31, 2019. APPL is part of established Azeen group
which is into same line of business since 1953 through other
entities namely Azeen Exim Private Limited and Parvin Cotex Private
Limited engaged in the business ginning and pressing of raw cotton
as well as oil extraction activities.
BINDAL COIR: CARE Lowers Rating on INR6.50cr LT Loan to B-
----------------------------------------------------------
CARE Ratings revised the ratings on certain bank facilities of
Bindal Coir Private Limited (BCPL), as:
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long Term 6.50 CARE B-; Stable; ISSUER NOT
Bank Facilities COOPERATING; Rating continues
to remain under ISSUER NOT
COOPERATING category and
Revised from CARE B; Stable
Detailed Rationale & Key Rating Drivers
CARE had, vide its press release dated January 13, 2021, placed the
rating(s) of BCPL under the 'issuer non-cooperating' category as
BCPL had failed to provide information for monitoring of the rating
and had not paid the surveillance fees for the rating exercise as
agreed to in its Rating Agreement. BCPL continues to be
non-cooperative despite repeated requests for submission of
information through e-mails, phone calls and a letter/email dated
November 29, 2021, December 9, 2021, December 19, 2021.
In line with the extant SEBI guidelines, CARE has reviewed the
rating on the basis of the best available information which,
however, in CARE's opinion is not sufficient to arrive at a fair
rating.
Users of this rating (including investors, lenders and the public
at large) are hence requested to exercise caution while using the
above rating(s).
The ratings have been revised on account of non-availability of
requisite information. The rating further considers a net loss
reported by BCPL in FY20.
Bindal Coir Private Limited (BCPL), based in New Delhi, was
incorporated in 1996 as a private limited company. The company is
currently being managed by Mr. Sandeep Gupta and Mrs. Manju Gupta.
BCPL is engaged in manufacturing of Pillows and Mattresses at its
facility located in Sampla, Haryana with an installed capacity of
manufacturing 2.40 lakh mattresses and 4.50 lakh pillows per annum
as on August 31, 2018. The product line mainly includes Spring
Mattresses, Rebounded Mattresses, Foam Mattresses, Coir Mattresses,
Fiber Pillows and Foam Pillows. It is also engaged in trading of PU
Foam (income from trading constituted 10% of the total income in
FY18).
BTS KNITSS: CARE Keeps C Debt Rating in Not Cooperating Category
----------------------------------------------------------------
CARE Ratings said the rating for the bank facilities of BTS Knitss
Process Private Limited (BKPPL) continues to remain in the 'Issuer
Not Cooperating ' category.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long Term 2.80 CARE C; Stable; ISSUER NOT
Bank Facilities COOPERATING; Rating continues
to remain under ISSUER NOT
COOPERATING category
Short Term Bank 0.05 CARE A4; ISSUER NOT
Facilities COOPERATING; Rating continues
To remain under ISSUER NOT
COOPERATING category
Detailed Rationale & Key Rating Drivers
CARE had, vide its press release dated December 28, 2020, placed
the rating(s) of BKPPL under the 'issuer non-cooperating' category
as BKPPL had failed to provide information for monitoring of the
rating and had not paid the surveillance fees for the rating
exercise as agreed to in its Rating Agreement. BKPPL continues to
be non-cooperative despite repeated requests for submission of
information through e-mails, phone calls and a letter/email dated
November 13, 2021, November 23, 2021 and December 3, 2021.
In line with the extant SEBI guidelines, CARE has reviewed the
rating on the basis of the best available information which
however, in CARE's opinion is not sufficient to arrive at a fair
rating.
Users of this rating (including investors, lenders and the public
at large) are hence requested to exercise caution while using the
above rating(s).
Tamilnadu based, B T S Knitss Process Private Limited (BKPPL) was
incorporated on August 24, 2005 and is promoted by Mr. P. Shiva
Kumar (Managing Director) along with his family members as
directors of the company. The company is engaged in dying of
various kinds of fabric at its manufacturing unit located at
Tirupur, Coimbatore District, Tamilnadu. Customers and suppliers of
BKPPL are located in and around Tirupur, Tamilnadu.
DHRUV COTEX: CARE Keeps B Debt Rating in Not Cooperating
--------------------------------------------------------
CARE Ratings said the rating for the bank facilities of Dhruv Cotex
Private Limited (DCPL) continues to remain in the 'Issuer Not
Cooperating ' category.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long Term Bank 13.00 CARE B; Stable; ISSUER NOT
Facilities COOPERATING; Rating continues
To remain under ISSUER NOT
COOPERATING category
Detailed Rationale & Key Rating Drivers
CARE had, vide its press release dated January 19, 2021, placed the
rating(s) of DCPL under the 'issuer non-cooperating' category as
DCPL had failed to provide information for monitoring of the rating
and had not paid the surveillance fees for the rating exercise as
agreed to in its Rating Agreement. DCPL continues to be
non-cooperative despite repeated requests for submission of
information through e-mails, phone calls and a letter/email dated
December 5, 2021, December 15, 2021, December 25, 2021.
In line with the extant SEBI guidelines, CARE has reviewed the
rating on the basis of the best available information which
however, in CARE's opinion is not sufficient to arrive at a fair
rating.
Users of this rating (including investors, lenders and the public
at large) are hence requested to exercise caution while using the
above rating(s).
Incorporated in 2011 by Mr. Utpal Bhayani and Mrs. Alka Desai,
Dhruv Cotex Private Limited (DCPL) is engaged into manufacturing of
woven grey fabrics used for shirting and dress material. It started
commercial operations on July 31, 2014 and at present the company
has 16 looms with capacity to manufacture 1802520 meters of grey
fabric per annum. Its facility is located at Dahiwad, Shirpur,
Dhule. DCPL sells its products in domestic market majorly to fabric
processing units in Delhi and Ahmedabad. DCPL is a part of the
Deesan group which has been in the business of textile
manufacturing since 1996 and has various companies operating under
it (including DCPL). Deesan group has presence in all segments of
cotton textiles starting from cultivation of cotton to
manufacturing of garments. DCPL receives operational support from
the other group companies in terms of procurement of materials and
building customers. DCPL's plant is established under the "Group
Work Shed Scheme" (Scheme of Integrated Textile Park (SITP) of
Ministry of Textile, the Government of India) and consists of 13
SSI units under it. The GWSS further operates a total of 80 looms
via the SSI units which provide job work services (viz. weaving,
warping and sizing of grey cloth) to DCPL.
EASTMAN RECLAMATIONS: CARE Keeps B- Debt Rating in Not Cooperating
------------------------------------------------------------------
CARE Ratings said the rating for the bank facilities of Eastman
Reclamations (ER) continues to remain in the 'Issuer Not
Cooperating ' category.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long Term Bank 7.60 CARE B-; Stable; ISSUER NOT
Facilities COOPERATING; Rating continues
To remain under ISSUER NOT
COOPERATING category
Short Term Bank 3.55 CARE A4; ISSUER NOT
Facilities COOPERATING; Rating continues
to remain under ISSUER NOT
COOPERATING category
Detailed Rationale & Key Rating Drivers
CARE had, vide its press release dated January 29, 2021, placed the
rating(s) of ER under the 'issuer non-cooperating' category as ER
had failed to provide information for monitoring of the rating and
had not paid the surveillance fees for the rating exercise as
agreed to in its Rating Agreement. ER continues to be
non-cooperative despite repeated requests for submission of
information through e-mails, phone calls and a letter/email dated
December 15, 2021, December 25, 2021, January 4, 2022.
In line with the extant SEBI guidelines, CARE has reviewed the
rating on the basis of the best available information which
however, in CARE's opinion is not sufficient to arrive at a fair
rating.
Users of this rating (including investors, lenders and the public
at large) are hence requested to exercise caution while using the
above rating(s).
Incorporated in 2011, ER is engaged in the manufacturing of
reclaimed rubber and rubber compounds of various types and sizes
since January-2013. The firm operates from its manufacturing
facility in Kathua, Jammu and Kashmir at an installed capacity of
manufacturing 27,000 tonnes per annum as on March 31, 2015. The
reclaimed rubber finds application in truck and bus auto tyres,
automobiles, rubber goods, road construction and sports surfaces.
The group concerns of the firm include Kohinoor Reclamations
(rated, 'CARE B-/CARE A4'; ISSUER NOT COOPERATING) and Kohinoor
India Private Limited (rated, 'CARE B; Stable/CARE A4; ISSUER NOT
COOPERATING) both engaged in the similar line of business.
EXCEL GENERATORS: CARE Keeps B Debt Rating in Not Cooperating
-------------------------------------------------------------
CARE Ratings said the rating for the bank facilities of Excel
Generators Private Limited (EGPL) continues to remain in the
'Issuer Not Cooperating ' category.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long Term 3.00 CARE B; Stable; ISSUER NOT
Bank Facilities COOPERATING; Rating continues
to remain under ISSUER NOT
COOPERATING category
Short Term Bank 2.50 CARE A4; ISSUER NOT
Facilities COOPERATING; Rating continues
To remain under ISSUER NOT
COOPERATING category
Detailed Rationale & Key Rating Drivers
CARE had, vide its press release dated December 9, 2020, placed the
rating(s) of EGPL under the 'issuer non-cooperating' category as
EGPL had failed to provide information for monitoring of the rating
and had not paid the surveillance fees for the rating exercise as
agreed to in its Rating Agreement. EGPL continues to be
non-cooperative despite repeated requests for submission of
information through e-mails, phone calls and a letter/email dated
October 25, 2021, November 4, 2021 and November 14, 2021.
In line with the extant SEBI guidelines, CARE has reviewed the
rating on the basis of the best available information which
however, in CARE's opinion is not sufficient to arrive at a fair
rating.
Users of this rating (including investors, lenders and the public
at large) are hence requested to exercise caution while using the
above rating(s).
Excel Generators Private Limited (EGPL) was incorporated in 1996,
promoted by Mr. Madhavan along with his spouse Mrs. Sheela
Madhavan. The company is engaged in assembling of DG sets and
providing services like installation, testing, commission and
annual maintenance services. EGPL is an authorized distributor for
rotary UPS from Euro-Diesel S.A., Belgium.
FUSION BUILDING: CARE Keeps B Debt Rating in Not Cooperating
------------------------------------------------------------
CARE Ratings said the rating for the bank facilities of Fusion
Building Materials (Vizag) Private Limited (FBMPL) continues to
remain in the 'Issuer Not Cooperating ' category.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long Term Bank 17.00 CARE B; Stable; ISSUER NOT
Facilities COOPERATING; Rating continues
To remain under ISSUER NOT
COOPERATING category
Detailed Rationale & Key Rating Drivers
CARE had, vide its press release dated December 30, 2020, placed
the rating(s) of FBMPL under the 'issuer non-cooperating' category
as FBMPL had failed to provide information for monitoring of the
rating and had not paid the surveillance fees for the rating
exercise as agreed to in its Rating Agreement. FBMPL continues to
be non-cooperative despite repeated requests for submission of
information through e-mails, phone calls and a letter/email dated
November 20, 2021, November 30, 2021, December 10, 2021.
In line with the extant SEBI guidelines, CARE Ratings Ltd. has
reviewed the rating on the basis of the best available information
which however, in CARE Ratings Ltd.'s opinion is not sufficient to
arrive at a fair rating.
Users of this rating (including investors, lenders and the public
at large) are hence requested to exercise caution while using the
above rating(s).
Fusion Building Materials (Vizag) Private Limited (FBMPL) was
incorporated on November 20, 2017 by Dr. Suresh Babu Sadineni
(Managing Director) and Ms. Ramanamma Sadineni. The company is
primarily engaged in manufacturing of Autoclaved Aerated Concrete
(ACC) Blocks of various dimensions and sizes and the same is sold
under the brand name 'Fusion Blocks'. The company has set up its
manufacturing unit with an installed capacity of 1,00,000 Cubic
Meter (M3) per annum at Yerravaram village line, near
Visakhapatnam, Andhra Pradesh which commenced operation on August
1, 2019.
G K ROOFINGS: CARE Keeps B- Debt Rating in Not Cooperating
----------------------------------------------------------
CARE Ratings said the rating for the bank facilities of G K
Roofings India Private Limited (GKRIPL) continues to remain in the
'Issuer Not Cooperating ' category.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long Term 6.00 CARE B-; Stable; ISSUER NOT
Bank Facilities COOPERATING; Rating continues
to remain under ISSUER NOT
COOPERATING category
Short Term Bank 1.00 CARE A4; ISSUER NOT
Facilities COOPERATING; Rating continues
To remain under ISSUER NOT
COOPERATING category
Detailed Rationale & Key Rating Drivers
CARE had, vide its press release dated December 24, 2020, placed
the rating(s) of GKRIPL under the 'issuer non-cooperating' category
as GKRIPL had failed to provide information for monitoring of the
rating and had not paid the surveillance fees for the rating
exercise as agreed to in its Rating Agreement. GKRIPL continues to
be noncooperative despite repeated requests for submission of
information through e-mails, phone calls and a letter/email dated
November 9, 2021, November 19, 2021 and November 29, 2021.
In line with the extant SEBI guidelines, CARE has reviewed the
rating on the basis of the best available information which
however, in CARE's opinion is not sufficient to arrive at a fair
rating.
Users of this rating (including investors, lenders and the public
at large) are hence requested to exercise caution while using the
above rating(s).
Tamil Nadu based, G K Roofings India Private Limited (GKRIPL) was
established as a Private Limited company in the year 2003 promoted
by Mr. K. Prathiban (Managing Director) along with other family
members as shareholders of the company. Currently, the company is
engaged in manufacturing and installation of steel structures and
roofing sheets at its plant located at Thirumullaivoyal, Chennai
with an installed capacity of 75 tons per month. The company
derives 90% of the revenue from BHEL (PAN India) and the remaining
10% from the customers located in and around Tamil Nadu. The
company purchases the raw material from various suppliers located
in Tamil Nadu.
GANPATI MEGA: CARE Keeps B+ Debt Rating in Not Cooperating
----------------------------------------------------------
CARE Ratings said the rating for the bank facilities of Ganpati
Mega Builders (India) Private Limited (GMBPL) continues to remain
in the 'Issuer Not Cooperating ' category.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long Term Bank 6.00 CARE B+; ISSUER NOT COOPERATING
Facilities Rating continues to remain
under ISSUER NOT COOPERATING
category
Long Term/ 9.00 CARE B+; Stable/CARE A4;
Short Term ISSUER NOT COOPERATING;
Bank Facilities Rating continues to remain
under ISSUER NOT COOPERATING
category
Detailed Rationale & Key Rating Drivers
CARE had, vide its press release dated January 18, 2021, placed the
rating(s) of GMBPL under the 'issuer non-cooperating' category as
GMBPL had failed to provide information for monitoring of the
rating and had not paid the surveillance fees for the rating
exercise as agreed to in its Rating Agreement. GMBPL continues to
be noncooperative despite repeated requests for submission of
information through e-mails, phone calls and a letter/email dated
December 04, 2021, December 14, 2021, December 24, 2021.
In line with the extant SEBI guidelines, CARE has reviewed the
rating on the basis of the best available information which
however, in CARE's opinion is not sufficient to arrive at a fair
rating.
Users of this rating (including investors, lenders and the public
at large) are hence requested to exercise caution while using the
above rating(s).
Ganpati Mega Builders India Private Limited (GMB) was incorporated
in February 2007. The company is currently promoted by Mr. Piyush
Jain, Mr. Avrar Quraishi, Mr. Parang Jain, Mr. Pawan Kumar Jain and
Mohd. Sultan. The company is engaged in construction works which
involve construction of building for government hospitals, canal
levelling, Mandi construction etc. GMB executes contracts mainly
for government departments. The main raw material for the company
includes cement, bricks, aggregate etc. which the company procures
mainly from local dealers. The company operates mainly in Uttar
Pradesh and Madhya Pradesh.
GOOD MEDIA: CARE Lowers Rating on INR10.58cr LT Loan to B-
----------------------------------------------------------
CARE Ratings revised the ratings on certain bank facilities of Good
Media News Private Limited (GMNPL), as:
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long Term Bank 10.58 CARE B-; Stable; ISSUER NOT
Facilities COOPERATING; Rating continues
To remain under ISSUER NOT
COOPERATING category and
Revised from CARE B; Stable
Detailed Rationale & Key Rating Drivers
CARE had, vide its press release dated January 15, 2021, placed the
rating(s) of GMNPL under the 'issuer non-cooperating' category as
GMNPL had failed to provide information for monitoring of the
rating and had not paid the surveillance fees for the rating
exercise as agreed to in its Rating Agreement. GMNPL continues to
be noncooperative despite repeated requests for submission of
information through e-mails, phone calls and a letter/email dated
December 1, 2021, December 11, 2021, December 30, 2021.
In line with the extant SEBI guidelines, CARE has reviewed the
rating on the basis of the best available information which,
however, in CARE's opinion is not sufficient to arrive at a fair
rating.
Users of this rating (including investors, lenders and the public
at large) are hence requested to exercise caution while using the
above rating(s).
The ratings for GMNPL have been revised on account of
non-availability of requisite information. The ratings also
consider the decline in scale of operations and profitability in
FY20 compared to FY19.
Originally incorporated as a proprietorship firm with the name
'chee – Na – Telecom' on March 1992. In the year 2007, it
converted into private limited company & the name changed to Bridge
View Broadband Network Pvt. Ltd. Further, the name of the company
was changed to Good Media News Private Limited (GMN) in 2013. The
company is being currently managed by its directors i.e. Mr.
Ashwani Thakur and Mr. Shekhar Mehta. GMN is engaged in cable
business and Internet Service Provider (ISP) holder providing
internet, broadband services, digital cable TV services, outdoor
advertising etc. The company is operating a news channel with the
name "City Channel" in Himachal Pradesh and also engaged in
printing weekly newspaper 'Democracy Post' in Hindi language. The
brand of GMN is 'City Channel. The company is having total 12 no.
of branches in the state Himachal Pradesh.
HERITAGE DISTILIARIES: CARE Keeps B Debt Rating in Not Cooperating
------------------------------------------------------------------
CARE Ratings said the rating for the bank facilities of Heritage
Distiliaries Private Limited (HDPL) continues to remain in the
'Issuer Not Cooperating ' category.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long Term Bank 13.81 CARE B; Stable; ISSUER NOT
Facilities COOPERATING; Rating continues
To remain under ISSUER NOT
COOPERATING category
Detailed Rationale & Key Rating Drivers
CARE had, vide its press release dated December 30, 2020, placed
the rating(s) of HDPL under the 'issuer non-cooperating' category
as HDPL had failed to provide information for monitoring of the
rating and had not paid the surveillance fees for the rating
exercise as agreed to in its Rating Agreement. HDPL continues to be
non-cooperative despite repeated requests for submission of
information through e-mails, phone calls and a letter/email dated
November 15, 2021, November 25, 2021, December 5, 2021.
In line with the extant SEBI guidelines, CARE Ratings Ltd. has
reviewed the rating on the basis of the best available information
which however, in CARE Ratings Ltd.'s opinion is not sufficient to
arrive at a fair rating.
Users of this rating (including investors, lenders and the public
at large) are hence requested to exercise caution while using the
above rating(s).
Heritage Distiliaries Private Limited (HDPL) was incorporated in
February 1999 by Mr. Kartik Swain, Mrs. Kanchan Swain, Mr. Rashmi
Kanta Pattnayak and Mr. Suryakanta Swain. Initially, the company
was into bottling business of Indian Made Foreign Liquor (IMFL)
till 2012. However, the company has discontinued the bottling
business thereafter and it has leased out its bottling plant (land,
building and plant & machineries) to United Spirits Limited (USL)
as per lease agreement dated from May 25, 2013. The company entered
into a lease out agreement with USL for leasing out its complete
bottling plant for 5 years with effect from April 2013. Further,
the aforesaid deed of lease agreement dated May 25, 2013 entered
into between the parties stands extended and shall continue for a
period of 11 years with effect from July 3, 2017.
HINDUSTAN CONSTRUCTION: Defaults on Debt Worth INR2,161cr
---------------------------------------------------------
BloombergQuint reports that Hindustan Construction Co. defaulted on
debt worth INR2,161 crore due as on Dec. 31.
The amount includes INR998.3 crore in principal amount and interest
and other charges worth INR629.9 crore and INR534.2 crore,
respectively, according to the company's exchange filing,
BloombergQuint relays.
The company has outstanding debt of INR9,727 crore, of which it
owes banks INR4,091 crore, BloombergQuint discloses.
According to the report, the board of the company had approved a
debt-restructuring plan on May 28 last year. Under the plan, HCC
were to transfer up to INR4,000 crore liability to its subsidiary
Prolific Resolution Pvt. It also planned to transfer awards of up
to INR2,749 crore and claims of up to INR2,136 crore to the arm to
pare debt.
According to the plan, an investor identified by lenders would
acquire 51% stake in the subsidiary for INR25 crore and will infuse
INR75 crore in Prolific Resolution in the form of priority debt.
The return on this investment was capped to an agreed threshold,
BloombergQuint notes.
BloombergQuint says HCC's corporate guarantee to lenders of
Prolific Resolution was limited to 20% or a maximum INR800 crore of
the debt transferred.
The implementation of the plan, however, has been delayed.
The debt resolution plan is in final stages, the company had said
in a Nov. 11 statement. It continues to receive lender approval and
implementation is expected in the quarter ended December.
HCC, however, has not provided any update on the plan since then,
BloombergQuint notes.
About Hindustan Construction
Hindustan Construction Company's businesses span the sectors of
Engineering & Construction, Real Estate, Infrastructure, Urban
development & Management.
As reported in the Troubled Company Reporter-Asia Pacific on Oct.
11, 2021, CARE Ratings reaffirmed 'CARE D' ratings on certain bank
facilities of Hindustan Construction Company Limited (HCC). The
reaffirmation of ratings assigned to the bank facilities and
instruments of HCC is on account of ongoing delays in debt
servicing obligations. The debt servicing capability of the company
is stressed on account of delays in execution of orders resulting
in lower turnover coupled with higher borrowings resulting in
higher interest outflow than the operating profit, thereby
incurring net losses continuously.
J.N. TAYAL: CARE Keeps B Debt Rating in Not Cooperating Category
----------------------------------------------------------------
CARE Ratings said the rating for the bank facilities of J.N. Tayal
Steels Private Limited (JTSPL) continues to remain in the 'Issuer
Not Cooperating ' category.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long Term Bank 6.29 CARE B; ISSUER NOT COOPERATING
Facilities Rating continues to remain
under ISSUER NOT COOPERATING
category
Detailed Rationale & Key Rating Drivers
CARE had, vide its press release dated January 20, 2021, placed the
rating(s) of JTSPL under the 'issuer non-cooperating' category as
JTSPL had failed to provide information for monitoring of the
rating and had not paid the surveillance fees for the rating
exercise as agreed to in its Rating Agreement. JTSPL continues to
be non-cooperative despite repeated requests for submission of
information through e-mails, phone calls and a letter/email dated
December 6, 2021, December 16, 2021, December 30, 2021.
In line with the extant SEBI guidelines, CARE has reviewed the
rating on the basis of the best available information which,
however, in CARE's opinion is not sufficient to arrive at a fair
rating.
Users of this rating (including investors, lenders and the public
at large) are hence requested to exercise caution while using the
above rating(s).
Incorporated in 2008, JTP is a private limited company with its
registered office in Guwahati, Assam. The company is engaged in the
manufacturing and selling of steel ingots at its manufacturing
facility located in Guwahati, with an installed capacity of
manufacturing 16,000 MTPA (metric tonnes per annum) of steel
ingots.
JAYEM AUTOMOTIVES: CARE Withdraws B+ Rating on Bank Debts
---------------------------------------------------------
CARE Ratings has withdrawn the ratings on certain bank facilities
of Jayem Automotives Private Limited (JAPL), as:
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long Term
Bank Facilities - Rating continues to remain
under ISSUER NOT COOPERATING
category; Reaffirmed at
CARE B+; Stable; ISSUER NOT
COOPERATING and Withdrawn
Short Term
Bank Facilities - Rating continues to remain
under ISSUER NOT COOPERATING
category; Reaffirmed at
CARE A4; ISSUER NOT
COOPERATING
Detailed Rationale, Key Rating Drivers and Detailed description of
the key rating drivers
CARE has reviewed the rating assigned to the bank facilities of
JAPL to 'CARE B+; Stable Issuer Not Cooperating' for long term
facilities and 'CARE A4 Issuer Not Cooperating' for short term
facilities and has simultaneously withdrawn it, with immediate
effect. The rating withdrawal is at the request of Jayem
Automotives Private Limited and 'No Objection Certificate' received
from the bank that has extended the facilities rated by CARE.
Detailed description of the key rating drivers
The ratings assigned to bank facilities of JAPL factors in growth
in total operating income in FY21 (Prov). The rating continues to
be tempered by modest scale of operations and cyclical nature of
automobile industry largely driven by technological upgradation.
The rating continues to derive benefits from experience of
promoters in the industry, well established and long standing
business association with various other Original Equipment
Manufacturers (OEMs), presence of multiple revenue streams with
special focus on engineering services, strong in-house design,
research and development capabilities and comfortable profitability
margins.
Key Rating Weaknesses:
* Decline in operating income: Total operating income has dropped
from INR72.07 Crore in FY21 viz a viz INR96.16 Crore in FY20
reporting 25% degrowth.
* Cyclical Nature of Automobile Industry largely driven by
technological upgradation: The auto industry is inherently
vulnerable to the economic cycles and is highly sensitive to the
interest rates, fuel prices and requirement to meet the stringent
emission control norms. The emergence of hybrid and electric
vehicles, connected and autonomous cars, digital technologies as
well as increasingly stringent emission and safety regulations are
driving global R&D activity and vehicle manufacturers are looking
to stay ahead of the curve by investing in new technologies and
coming up with innovations.
Liquidity: Stretched
Liquidity position marked by its operating cycle remained stretched
at 306 days in FY21 as against 171 days in FY20 owing to
high inventory holding period of 286 days, collection period of 168
days and creditor's period of 147 days in FY21 (Prov). Cash
and bank balances as on March 31, 2021 (Prov.) stood at INR0.24
Crore as against INR0.28 Crore in FY20.
Key Rating Strengths:
* Experience of the promoters in the industry: The company is
managed by Mr. B. Jayachandran & his son, Mr, J. Anand. Mr. B.
Jayachandran, Chairman of the company is engaged in the field of
automobile for more than 20 years. Trained in Germany, he provides
able guidance to the company's business, R&D and manufacturing
team.
* Well established and long standing business association with
OEMs: JAPL in its initial years was involved in development of new
vehicles and engines to Mahindra & Mahindra (M&M). Later in 2005,
the company started partnering with Tata Motors Limited where it
supported various testing and new vehicle development initiatives
of Tata motors. In addition to TML, the company has also undertaken
design, development and manufacture of vehicles for Defense,
vehicle & engine testing for companies like FORD, Mercedes and
casting and foundry components for other automobile companies.
* Multiple Revenue Stream & Comfortable Profit Margins: The
company's revenue profile mainly consists of income from Engine &
Endurance Testing, Vehicle Testing, Sale of Components and Specific
Project Income with engine testing and endurance testing being the
key income generators for the company. Operating margins improved
from 16.47% in FY20 to 23.62% in FY21. Net profit margin also has
improved in line with increase in operating profits on absolute
basis and stood at 6.31% in FY21 from 4.22% in FY20.
Jayem Automotives (P) Ltd (JAPL), was incorporated in 1999 by Mr.
B. Jayachandran, as an independent automotive R&D company involved
in design, development, testing of automobile engine & their parts
and manufacturing of a wide range of automotive components, systems
and prototypes. JAPL caters to the requirements in the automobile
segment spread across two wheelers, passenger cars, construction &
agri-equipments, commercial & off highway vehicles and race cars.
MEENA JEWELLERS: CARE Keeps D Debt Rating in Not Cooperating
------------------------------------------------------------
CARE Ratings said the rating for the bank facilities of Meena
Jewellers Extension Private Limited (MJEPL) continues to remain in
the 'Issuer Not Cooperating ' category.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long Term Bank 28.00 CARE D; ISSUER NOT COOPERATING
Facilities Rating continues to remain
under ISSUER NOT COOPERATING
category
Detailed Rationale & Key Rating Drivers
CARE had, vide its press release dated December 29, 2020, placed
the rating(s) of MJEPL under the 'issuer non-cooperating' category
as MJEPL had failed to provide information for monitoring of the
rating and had not paid the surveillance fees for the rating
exercise as agreed to in its Rating Agreement. MJEPL continues to
be noncooperative despite repeated requests for submission of
information through e-mails, phone calls and a letter/email dated
November 14, 2021, November 24, 2021, December 4, 2021.
In line with the extant SEBI guidelines, CARE Ratings Ltd. has
reviewed the rating on the basis of the best available information
which however, in CARE Ratings Ltd.'s opinion is not sufficient to
arrive at a fair rating.
Users of this rating (including investors, lenders and the public
at large) are hence requested to exercise caution while using the
above rating(s).
Meena Jewellers Extension Private Limited, incorporated in 2012,
belongs to the Meena Jewellers group (MJG) which is the jewellery
arm of the Meena Bazar group which has over 75 years of presence in
the twin cities of Hyderabad/Secunderabad. Meena Bazar group has
varied business interests consisting of retailing in sarees,
textiles, garments and jewellery, exhibition of films,
construction, etc.
MEENA JEWELS: CARE Keeps D Debt Rating in Not Cooperating
---------------------------------------------------------
CARE Ratings said the rating for the bank facilities of Meena
Jewels Exports (MJE) continues to remain in the 'Issuer Not
Cooperating ' category.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long Term Bank 32.00 CARE D; ISSUER NOT COOPERATING
Facilities Rating continues to remain
under ISSUER NOT COOPERATING
category
Detailed Rationale & Key Rating Drivers
CARE had, vide its press release dated December 29, 2020, placed
the rating(s) of MJE under the 'issuer non-cooperating' category as
MJE had failed to provide information for monitoring of the rating
and had not paid the surveillance fees for the rating exercise as
agreed to in its Rating Agreement. MJE continues to be
non-cooperative despite repeated requests for submission of
information through e-mails, phone calls and a letter/email dated
November 14, 2021, November 24, 2021, December 4, 2021.
In line with the extant SEBI guidelines, CARE Ratings Ltd. has
reviewed the rating on the basis of the best available information
which however, in CARE Ratings Ltd.'s opinion is not sufficient to
arrive at a fair rating.
Users of this rating (including investors, lenders and the public
at large) are hence requested to exercise caution while using the
above rating(s).
Meena Jewels Exports, incorporated in 2012, belongs to the Meena
Jewellers group (MJG) which is the jewellery arm of the Meena Bazar
group which has over 75 years of presence in the twin cities of
Hyderabad/Secunderabad. Meena Bazar group has varied business
interests consisting of retailing in sarees, textiles, garments and
jewellery, exhibition of films, construction, etc.
NARAYANI STEELS: CARE Keeps D Debt Ratings in Not Cooperating
-------------------------------------------------------------
CARE Ratings said the rating for the bank facilities of Narayani
Steels Limited continues to remain in the 'Issuer Not Cooperating '
category.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long Term Bank 97.50 CARE D; ISSUER NOT COOPERATING
Facilities Rating continues to remain
under ISSUER NOT COOPERATING
category
Short Term Bank 125.00 CARE D; ISSUER NOT COOPERATING
Facilities Rating continues to remain
under ISSUER NOT COOPERATING
category
Detailed Rationale & Key Rating Drivers
CARE Ratings Ltd. had, vide its press release dated January 13,
2021, placed the rating(s) of Narayani Steels Limited under the
'issuer non-cooperating' category as Narayani Steels Limited had
failed to provide information for monitoring of the rating.
Narayani Steels Limited continues to be non-cooperative despite
repeated requests for submission of information through emails,
phone calls and an email dated November 29, 2021 to December 19,
2021. In line with the extant SEBI guidelines, CARE Ratings Ltd.
has reviewed the rating on the basis of the best available
information which however, in CARE Ratings Ltd.'s opinion is not
sufficient to arrive at a fair rating.
Users of this rating (including investors, lenders and the public
at large) are hence requested to exercise caution while using the
above rating(s).
At the time of last rating on January 13, 2021 the following were
the rating strengths and weaknesses (updated for the information
available from BSE).
Key rating weakness
* Continuing overdues with respect to debt servicing: The lenders
have confirmed that are continued overdraws and the account has
turned NPA owing to liquidity issues.
Narayani Steels Limited (NSL), which belongs to Narayani Group, is
incorporated in the year 1996 by Mr. Kishanlal Choudhary, who is
the chairman of the company and he is ably supported by his son Mr.
Sunil Choudhary, who is the managing director and chief executive
officer with an overall experience of 20 years. During FY17,
Narayani Steels Limited got listed through SME platform of Bombay
stock exchange in FY17. NSL is part of Narayani group; the group
comprises of five companies namely Narayani Steels Limited (NSL),
Narayani Ispat Limited (NIL), Hari Equipment Private Limited
(HEPL), Kedarnath Commotrade Private Limited (KCPL) and Agrimony
Tradex Vyaappar Private Limited (ATVPL). Narayani group is engaged
in trading of blooms, billets, TMT bars, pellets, wire coils and
manufacturing of TMT bars and other long products such as rounds,
flats, angles, channels, etc. Further, the group has a wide network
for the sales and distribution of the products across Andhra
Pradesh, Telangana and other states in India.
PARVIN COTEX: CARE Keeps B+ Debt Rating in Not Cooperating
----------------------------------------------------------
CARE Ratings said the rating for the bank facilities of Parvin
Cotex Private Limited (PCPL) continues to remain in the 'Issuer Not
Cooperating ' category.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long Term Bank 10.00 CARE B+; ISSUER NOT COOPERATING
Facilities Rating continues to remain
under ISSUER NOT COOPERATING
category
Detailed Rationale & Key Rating Drivers
CARE had, vide its press release dated December 3, 2020, placed the
rating(s) of PCPL under the 'issuer non-cooperating' category as
PCPL had failed to provide information for monitoring of the rating
and had not paid the surveillance fees for the rating exercise as
agreed to in its Rating Agreement. PCPL continues to be
non-cooperative despite repeated requests for submission of
information through e-mails, phone calls and a letter/email dated
October 19, 2021, October 29, 2021, November 8, 2021.
In line with the extant SEBI guidelines, CARE has reviewed the
rating on the basis of the best available information which
however, in CARE's opinion is not sufficient to arrive at a fair
rating.
Users of this rating (including investors, lenders and the public
at large) are hence requested to exercise caution while using the
above rating(s).
PCPL, incorporated in 2008 by Mr. Akbar Vohra, a private limited
company engaged in the business of cotton ginning and pressing by
sourcing cotton through local farmers from Maharashtra. Cotton
bales are used in manufacturing of cotton yarn, cotton seeds are
further processed for extraction of edible oil. PCPL operates
through its sole processing unit located in Beed (Maharashtra),
which has an installed capacity to process 58 metric tons of cotton
bales per day and 125 metric tons of cotton seeds per day as on
March 31, 2019.
PREMIER BARS: CARE Lowers Rating on INR6.76cr LT Loan to B+
-----------------------------------------------------------
CARE Ratings revised the ratings on certain bank facilities of
Premier Bars Limited (PBL), as:
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long Term 6.76 CARE B+; Stable; ISSUER NOT
Bank Facilities COOPERATING; Rating continues
to remain under ISSUER NOT
COOPERATING category and
Revised from CARE BB-;
Stable
Long Term/ 61.74 CARE B+; Stable/CARE A4;
Short Term ISSUER NOT COOPERATING;
Bank Facilities Rating continues to remain
under ISSUER NOT COOPERATING
category and Revised from
CARE BB-; Stable/CARE A4
Short Term 6.50 CARE A4; ISSUER NOT
Bank Facilities COOPERATING; Rating continues
to remain under ISSUER NOT
COOPERATING category
Detailed Rationale & Key Rating Drivers
CARE had, vide its press release dated November 11, 2020, placed
the rating(s) of PBL under the 'issuer non-cooperating' category as
PBL had failed to provide information for monitoring of the rating
and had not paid the surveillance fees for the rating exercise as
agreed to in its Rating Agreement. PBL continues to be
non-cooperative despite repeated requests for submission of
information through e-mails, phone calls and a letter/email dated
September 27, 2021, October 7, 2021, October 17, 2021.
In line with the extant SEBI guidelines, CARE has reviewed the
rating on the basis of the best available information which
however, in CARE's opinion is not sufficient to arrive at a fair
rating.
Users of this rating (including investors, lenders and the public
at large) are hence requested to exercise caution while using the
above rating(s).
The ratings of bank facilities of PBL have been revised on account
of non-availability of requisite information. Rating also considers
decline in scale of operations and profitability with increase in
overall debt in FY20.
Jaipur-based, Premier Bars Limited (PBL) was incorporated in 2004
by Mr Arun Kumar Jain along with family members with an objective
to set up a Greenfield unit for manufacturing of TMT Bars which are
supplied to steel traders in Rajasthan. TMT Bars manufactured by
PBL are sold under brand name of 'Premier TMT' through its
distributor/dealer network as well as directly to its customers
which are mostly real estate players, with sales concentrated
predominantly in Northern region of India. PBL is also authorized
conversion agent of SAIL Limited for TMT Bars for the state of
Rajasthan. PBL is also engaged in manufacturing of Cement Concrete
Blocks and Cement Concrete Pavers which are sold under brand name
of 'Pavcon' and also manufactures galvanized steel poles which are
sold under the brand 'Polmax'. The company has three manufacturing
units in Jaipur; Rajasthan with the total capacity of the TMT Bars
unit is about 120000 Metric Tonnes Per Annum (MTPA) and M.S. Ingots
with capacity of 24000 Metric Tonnes Per Annum (MTPA).
PUNJAB & MAHARASHTRA: NHB Exposure May Get Preferential Treatment
-----------------------------------------------------------------
The Hindu BusinessLine reports that National Housing Bank's INR150
crore refinance exposure to the scam-hit Punjab and Maharashtra
Co-operative (PMC) Bank may get preferential treatment vis-a-vis
other institutional creditors having uninsured deposits with the
bank.
According to the report, the INR150 crore refinance that NHB has
given to PMC Bank against its individual home loans will get
transferred to Unity Small Finance Bank (the transferee bank into
which PMC Bank will get amalgamated).
However, NHB may not earn any interest on the refinance amount for
the entire period that PMC Bank has been under RBI Directions (from
the close of the bank's business on September 23, 2019) till the
appointed date (when the amalgamation of PMC Bank with Unity Small
Finance Bank/SFB takes effect), according to sources.
From the appointed date, NHB's exposure to PMC Bank (transferor
Bank) is expected to be continued as refinance on the book of Unity
SFB (transferee Bank), the report states. So, Unity SFB can make
quarterly payments to NHB on the refinance outstanding.
Hence, NHB may have an edge over other institutional creditors of
PMC Bank. The final scheme of amalgamation of PMC Bank with Unity
SFB is still in the works.
As per the draft scheme of amalgamation of PMC Bank with Unity SFB,
on and from the appointed date, 80% of the uninsured deposits
outstanding (aggregate in various accounts) to the credit of each
institutional depositor of the transferor bank shall be converted
into Perpetual Non-Cumulative Preference Shares (PNCPS) of
transferee bank with dividend of one per cent per annum payable
annually, BusinessLine notes.
After ten years from the appointed date, the transferee bank may
consider additional benefits for such PNCPS holders either in the
form of providing a step up in coupon rate or a call option, upon
receipt of approval from the Reserve Bank.
Further, the remaining 20% amount of the institutional deposits
will be converted into equity warrants of transferee bank at a
price of INR1 per warrant.
These equity warrants will further be converted into equity shares
of the transferee bank at the time of the Initial Public Offer
(IPO) when the transferee bank goes for public issue, the report
notes.
BusinessLine relates that the Maharashtra State Co-operative Banks'
Association, in its suggestion to RBI on the draft scheme of
amalgamation, said that instead of converting the deposits of urban
co-operative banks/UCBs (with PMC Bank) into PNCPS and equity
warrants of Unity SFB, the latter should return 20% of
UCBsoutstanding deposits every year.
Further, Unity SFB should pay UCBs the normal rate of interest on
their deposits. The Association's member UCBs have deposits
aggregating INR826 crore parked in PMC Bank.
According to Section 16(B)(1) of the NHB Act, sums received by a
borrowing institution in repayment or realisation of loans and
advances financed or refinanced, either wholly or partly by NHB,
shall, to the extent of the accommodation granted by it and
remaining outstanding, be deemed to have been received by the
borrowing institution in trust for NHB, and shall accordingly be
paid by such institution to NHB.
As per Section 16(B)(2) of the NHB Act, where any accommodation has
been granted by NHB to a borrowing institution, all securities
held, or which may be held, by such borrowing institution on
account of any transaction in respect of which such accommodation
has been granted, shall be held by such institution in trust for
NHB, BusinessLine says.
About Punjab & Maharashtra
Punjab & Maharashtra Co-operative Bank (PMC Bank) is a multi-state
scheduled urban co-operative bank with its area of operation in
Maharashtra, Delhi, Karnataka, Goa, Gujarat, Andhra Pradesh and
Madhya Pradesh. It has 137 branches.
In September 2019, PMC Bank was placed under restrictions of the
Reserve Bank of India (RBI) for six months following the unearthing
of a INR4,355-crore scam.
REMIRA MOTORS: CARE Lowers Rating on INR17.11cr LT Loan to B-
-------------------------------------------------------------
CARE Ratings revised the ratings on certain bank facilities of
Remira Motors Private Limited (RMPL), as:
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long Term 17.11 CARE B-; Stable; ISSUER NOT
Bank Facilities COOPERATING; Rating continues
to remain under ISSUER NOT
COOPERATING category and
Revised from CARE B; Stable
Detailed Rationale & Key Rating Drivers
CARE had, vide its press release dated January 15, 2021, placed the
rating(s) of RMPL under the 'issuer non-cooperating' category as
RMPL had failed to provide information for monitoring of the rating
and had not paid the surveillance fees for the rating exercise as
agreed to in its Rating Agreement. RMPL continues to be
non-cooperative despite repeated requests for submission of
information through e-mails, phone calls and a letter/email dated
December 1, 2021, December 11, 2021, December 30, 2021.
In line with the extant SEBI guidelines, CARE has reviewed the
rating on the basis of the best available information which
however, in CARE's opinion is not sufficient to arrive at a fair
rating.
Users of this rating (including investors, lenders and the public
at large) are hence requested to exercise caution while using the
above rating(s).
The ratings for RMPL have been revised on account of
non-availability of requisite information.
Remira Motors Private Limited (RMP) was incorporated in March 2016
as a private limited company and is currently being managed by Mr.
Amit Singh Brar and Mr. Jagmohan Singh Brar. RMP commenced
commercial operations in July 2016. The company is an authorised
dealer of passenger and utility vehicles of Maruti Suzuki India
Limited. RMP operates a 3S facility (sales, spares and service) and
is also engaged in purchase and sale of preowned cars at its
showroom/ workshop located at Moga (Punjab). Besides DOPL, the
directors are also associated with another group concerns namely
Bel Nutrition Private Limited and Brar Enterprises Limited.
SAR SENAPATI: CARE Keeps D Debt Rating in Not Cooperating
---------------------------------------------------------
CARE Ratings said the rating for the bank facilities of Sar
Senapati Santaji Ghorpade Sugarfactory Limited (SSSGSL) continues
to remain in the 'Issuer Not Cooperating ' category.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long Term Bank 265.97 CARE D; ISSUER NOT COOPERATING
Facilities Rating continues to remain
under ISSUER NOT COOPERATING
category
Detailed Rationale & Key Rating Drivers
CARE had, vide its press release dated January 18, 2021, placed the
rating(s) of SSSGSL under the 'issuer non-cooperating' category as
SSSGSL had failed to provide information for monitoring of the
rating and had not paid the surveillance fees for the rating
exercise as agreed to in its Rating Agreement. SSSGSL continues to
be non-cooperative despite repeated requests for submission of
information through e-mails, phone calls and a letter/email dated
December 4, 2021, December 14, 2021, December 24, 2021.
In line with the extant SEBI guidelines, CARE has reviewed the
rating on the basis of the best available information which
however, in CARE's opinion is not sufficient to arrive at a fair
rating.
Users of this rating (including investors, lenders and the public
at large) are hence requested to exercise caution while using the
above rating(s).
Incorporated on February 19, 2011, SSSGSL is promoted by Mr.
Hasanrao Mushrif, chief promoter, along with Mr. Sajid Hasan
Mushrif, Managing Director (MD). The company is engaged in
manufacturing of sugar & related products. The manufacturing
facility is located at Kolhapur with crushing capacity of 4,800
tonnes of cane crushed per day (TCD), 30 Kilo Litres per Day (KLPD)
distillery and bagasse fired co-generation unit of 22 mega-watts
(MW).
SONA DIAMOND: CARE Keeps B- Debt Rating in Not Cooperating
----------------------------------------------------------
CARE Ratings said the rating for the bank facilities of Sona
Diamond and Gold Exporters Private Limited (SDGEPL) continues to
remain in the 'Issuer Not Cooperating ' category.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long Term Bank 6.00 CARE B-; ISSUER NOT COOPERATING
Facilities Rating continues to remain
under ISSUER NOT COOPERATING
category
Detailed Rationale & Key Rating Drivers
CARE had, vide its press release dated December 15, 2020, placed
the rating(s) of SDGEPL under the 'issuer non-cooperating' category
as SDGEPL had failed to provide information for monitoring of the
rating and had not paid the surveillance fees for the rating
exercise as agreed to in its Rating Agreement. SDGEPL continues to
be non-cooperative despite repeated requests for submission of
information through e-mails, phone calls and a letter/email dated
October 31, 2021, November 10, 2021, November 20, 2021.
In line with the extant SEBI guidelines, CARE has reviewed the
rating on the basis of the best available information which
however, in CARE's opinion is not sufficient to arrive at a fair
rating.
Users of this rating (including investors, lenders and the public
at large) are hence requested to exercise caution while using the
above rating(s).
Sona Diamond and Gold Exporters Private Limited was incorporated in
December 2008 by Mr Mohanan Kallate Velayudhan and his family
members based in Thrissur, Kerala. Since inception, the company is
engaged in manufacturing and wholesaling of gold & silver jewellery
studded with precious and semi-precious stones and plain gold &
silver jewellery.
TECH INDIA: CARE Keeps B- Debt Rating in Not Cooperating Category
-----------------------------------------------------------------
CARE Ratings said the rating for the bank facilities of Tech India
Enterprises (TIE) continues to remain in the 'Issuer Not
Cooperating ' category.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long Term 5.00 CARE B-; Stable; ISSUER NOT
Bank Facilities COOPERATING; Rating continues
to remain under ISSUER NOT
COOPERATING category
Detailed Rationale & Key Rating Drivers
CARE had, vide its press release dated December 31, 2020, placed
the rating(s) of TIE under the 'issuer non-cooperating' category as
TIE had failed to provide information for monitoring of the rating
and had not paid the surveillance fees for the rating exercise as
agreed to in its Rating Agreement. TIE continues to be
non-cooperative despite repeated requests for submission of
information through e-mails, phone calls and a letter/email dated
November 16, 2021, November 26, 2021, December 6, 2021.
In line with the extant SEBI guidelines, CARE Ratings Ltd. has
reviewed the rating on the basis of the best available information
which however, in CARE Ratings Ltd.'s opinion is not sufficient to
arrive at a fair rating.
Users of this rating (including investors, lenders and the public
at large) are hence requested to exercise caution while using the
above rating(s).
Tech India Enterprises (TIE) was established in June 2017 as a
proprietorship entity. The entity has been engaged in civil
construction activities in the segment like roads, buildings etc.
TIE secures work contracts through tender and executes orders
mainly for Central Coalfields Limited, South Eastern Railway etc.
VASAVI POWER: CARE Keeps D Debt Ratings in Not Cooperating
----------------------------------------------------------
CARE Ratings said the rating for the bank facilities of Vasavi
Power Services Private Limited (VPSPL) continues to remain in the
'Issuer Not Cooperating ' category.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long Term Bank 15.00 CARE D; ISSUER NOT COOPERATING
Facilities Rating continues to remain
under ISSUER NOT COOPERATING
category
Short Term Bank 50.00 CARE D; ISSUER NOT COOPERATING
Facilities Rating continues to remain
under ISSUER NOT COOPERATING
category
Detailed Rationale & Key Rating Drivers
CARE had, vide its press release dated December 29, 2020, placed
the rating(s) of VPSPL under the 'issuer non-cooperating' category
as VPSPL had failed to provide information for monitoring of the
rating and had not paid the surveillance fees for the rating
exercise as agreed to in its Rating Agreement. VPSPL continues to
be noncooperative despite repeated requests for submission of
information through e-mails, phone calls and a letter/email dated
November 14, 2021, November 24, 2021, December 4, 2021.
In line with the extant SEBI guidelines, CARE Ratings Ltd. has
reviewed the rating on the basis of the best available information
which however, in CARE Ratings Ltd.'s opinion is not sufficient to
arrive at a fair rating.
Users of this rating (including investors, lenders and the public
at large) are hence requested to exercise caution while using the
above rating(s).
Vasavi Power Services Private Limited (VPSPL) is primarily engaged
in the business of ETC (Erection, testing and commissioning) and
MRO (Maintenance, repair and overhauls) of power equipment. The
company was established as a proprietorship concern, Vasavi
Engineering Works, in 1980. In 1982, it was reconstituted as a
partnership firm. In 2001, it was reconstituted as a private
limited company, under its current name.
VATIKA SOVEREIGN: CARE Lowers Rating on INR182.97cr Loan to D
-------------------------------------------------------------
CARE Ratings revised the ratings on certain bank facilities of
Vatika Sovereign Park Private Limited (VSPPL), as:
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long Term Bank 182.97 CARE D; ISSUER NOT COOPERATING
Facilities Rating continues to remain
under ISSUER NOT COOPERATING
category and Revised from
CARE C (CE); Stable
Detailed Rationale & Key Rating Drivers
CARE had, vide its press release dated November 2, 2021, placed the
rating(s) of VSPPL under the 'issuer non-cooperating' category as
VSPPL had failed to provide information for monitoring of the
rating and had not paid the surveillance fees for the rating
exercise as agreed to in its Rating Agreement. VSPPL continues to
be noncooperative despite repeated requests for submission of
information through e-mail dated January 7, 2022.
In line with the extant SEBI guidelines, CARE has reviewed the
rating on the basis of the best available information which
however, in CARE's opinion is not sufficient to arrive at a fair
rating.
Users of this rating (including investors, lenders and the public
at large) are hence requested to exercise caution while using the
above rating(s).
The revision in the rating assigned to the bank facilities of VSPPL
is pursuant to the CARE Ratings' updated default recognition policy
and ongoing delays in debt servicing as confirmed by the lenders to
CARE as part of the due diligence exercise. CARE understands, based
on its past interaction with lenders, that the corporate guarantee
issued by Vatika Limited was not invoked. VSPPL was incorporated in
2011 for the purpose of real estate project development. The
company is a step-down subsidiary of Vatika Limited, Group's
flagship company. VSPPL is developing a 9.68 acres luxurious
residential towers at a cost of INR645 crore, part of Vatika India
Next (An integrated township with area spanning over 677 acres
having residential- floors, plots, villas, group housing, gated
towns and commercial projects) in Sector 99, Gurgaon with saleable
area of 68.02 lakh square feet (lsf). The project is a joint
venture between Vatika Limited and GIC, Singapore's sovereign
wealth fund. Project is designed by Arcop, Canada and Landscaping
is designed by M. Paul Friedberg, New York.
[*] INDIA: LegalPay Partners With Jumbo Finance to Fund CIRP Cases
------------------------------------------------------------------
The Economic Times of India reports that legal technology startup
LegalPay has partnered with Mumbai-based non-banking finance firm
Jumbo Finance Ltd to give interim finance to the companies
undergoing the Corporate Insolvency Resolution Process (CIRP).
ET relates that New Delhi-based LegalPay, which also works as an
alternative-investments platform specializing in legal financing,
is also in talks with some more such NBFCs to fund companies under
CIRP. The firm is targeting mid-market companies, including
micro-small and medium enterprises (MSMEs), undergoing insolvencies
requiring up to INR5 crore.
Under the Insolvency & Bankruptcy Code (IBC) 2016, interim
financing is a short-term super-secure loan that allows an
insolvent company to remain operational while undergoing a
Corporate Insolvency Resolution Process (CIRP), the report notes.
"This will provide investors with more opportunities to invest in
distressed debt assets over the foreseeable shorter time horizon,"
ET quotes Kundan Sahi, founder of LegalPay, as saying.
According to the recent RBI financial stability report, the gross
non-NPA ratio will likely increase from 7.48% in March 2021 to 9.80
% - 11.22 % in March 2022, the report discloses.
As per the latest report by the Insolvency & Bankruptcy Board of
India (IBBI), since the inception of the IBC, a total of 4,708
CIRPs have commenced by the end of September 2021. Out of these
companies, 421 completed approval of the resolution plan, ET
relates.
"Investing in distressed debt assets is an interesting space for us
as investors, and we look forward to our partnership with LegalPay
to explore opportunities in the insolvency market/space," the
report quotes Smriti Ranka, Managing Director of Jumbo Finance, as
saying.
Over five years since the Insolvency and Bankruptcy Code (IBC) took
effect; the new law has helped recover about INR2.5 lakh crore or
around one-third of the admitted financial claims from insolvent
firms, said rating agency Crisil in its November 3 report, ET
relays.
The rating agency added that the new code marked a significant
shift in India's insolvency resolution process and credit culture.
=================
I N D O N E S I A
=================
SAWIT SUMBERMAS: Moody's Lowers CFR to Caa1, Outlook Negative
-------------------------------------------------------------
Moody's Investors Service has downgraded the corporate family
rating (CFR) of Sawit Sumbermas Sarana Tbk (P.T.) (SSMS) to Caa1
from B3. At the same time, Moody's has downgraded the backed senior
unsecured rating on the $300 million notes issued by the company's
wholly-owned subsidiary, SSMS Plantation Holdings Pte. Ltd., to
Caa1 from B3.
The outlook remains negative.
"The downgrade reflects rising refinancing risk associated with
SSMS' US dollar notes maturing in January 2023," says Maisam
Hasnain, a Moody's Vice President and Senior Analyst. "Governance
risks, including limited transparency around related-party
transactions and the financial health of its parent, could
constrain the company's ability to raise debt to support its
refinancing plans."
RATINGS RATIONALE
SSMS' liquidity is weak as its internal cash balance of around $120
million as of September 2021 and projected cash from operations
will be insufficient to fully redeem its $300 million notes due in
January 2023.
The company has stated publicly that it is in discussions with
several banks to raise new secured bank loans to refinance its US
dollar notes and aims to sign these loans within the first quarter
of 2022.
However, the new loans require credit approvals from banks, the
timing of which remains uncertain. Alternative fundraising plans
will also be subject to market conditions, particularly as SSMS'
$300 million notes continue to trade at a considerable discount to
the original par value, at around 70 cents on the dollar.
SSMS' ability to refinance in a timely manner is also challenged by
its limited banking relationships, with around 98% of its
outstanding consolidated bank loans as of 30 September 2021 coming
from one bank -- PT Bank Negara Indonesia (Persero) Tbk (Baa2
stable).
While strong crude palm oil prices and profitable operations have
improved SSMS' credit metrics over the past 12 months, the
company's credit quality is constrained by ongoing governance
risks.
These risks include the absence of controls restricting cash flow
between SSMS and its parent Citra Borneo Indah (P.T.) (CBI),
limited transparency around continued related-party transactions,
and limited public disclosures around CBI's financial health.
SSMS' $300 million notes' indenture requires CBI to provide
quarterly and annual financials with the trustee. But CBI has not
filed financials since September 2020, which is a breach of the
reporting obligations under the indenture. This could trigger an
event of default if the breach continues for 30 consecutive days
after written notice by the trustee or holders of 25% or more in
aggregate principal amount of the notes.
However, as SSMS has continued to make timely interest payment on
its notes, the incentive for noteholders to call a default ahead of
the notes maturity is low.
As the predominant cash flow generator of CBI, SSMS will continue
to financially support CBI's other businesses and future
investments over the next few years. However, the quantum of that
financial support is unclear given limited clarity over CBI's
financial position.
SSMS has consistently extended loans to CBI in recent years to help
fund its other businesses, including its palm oil refinery. For the
nine months ended September 2021, SSMS extended IDR349 billion in
related-party loans to its parent.
Continued cash leakage, particularly at a time when SSMS has large
near-term debt maturities, highlights weak governance practices and
could ultimately reduce recovery prospects for SSMS' noteholders in
a default scenario.
OUTLOOK
The outlook is negative, reflecting near-term refinancing risk
associated with SSMS' US dollar notes due in January 2023.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS
An upgrade is unlikely over the next 12 months given the negative
outlook.
However, Moody's could upgrade the ratings if SSMS (1) fully
refinances its maturing US dollar notes without a loss to
investors, while maintaining sufficient liquidity to meet its cash
needs over the next 12-18 months; and (2) materially improves its
governance practices and corporate transparency, particularly
regarding related-party transactions.
Moody's could downgrade the ratings (1) if the risk of an event of
default intensifies, or if recovery prospects for the company's
creditors decline; or (2) governance risks increase further,
including material cash leakage from SSMS to related parties.
Listed on the Indonesian Stock Exchange in December 2013, Sawit
Sumbermas Sarana Tbk (P.T.) is a palm oil producer with a market
capitalization of around IDR9.7 trillion ($675 million) as of 10
January 2022.
=====================
N E W Z E A L A N D
=====================
MITCHELL CORP: Creditors' Proofs of Debt Due on March 11
--------------------------------------------------------
Creditors of Mitchell Corp New Zealand Limited, which is in
members' voluntary liquidation, are required to file their proofs
of debt by March 11, 2022, to be included in the company's dividend
distribution.
The company commenced wind-up proceedings on Dec. 21, 2021.
The company's liquidators are:
Rhys Cain
Larissa Logan
PO Box 2091, Level 4
93 Cambridge Terrace
Christchurch, New Zealand
PALISADE COMPLIANCE: Creditors' Proofs of Debt Due on Feb. 11
-------------------------------------------------------------
Creditors of Palisade Compliance Limited, which is in members'
voluntary liquidation, are required to file their proofs of debt by
Feb. 11, 2022, to be included in the company's dividend
distribution.
The company commenced wind-up proceedings on Dec. 23, 2021.
The company's liquidators are:
Iain Bruce Shephard
Jessica Jane Kellow
BDO Wellington
Level 1, 50 Customhouse Quay
Wellington 6011
New Zealand
ZAHI'S TEST: Creditors' Proofs of Debt Due on Feb. 28
-----------------------------------------------------
Creditors of Zahi's Test and Tag Limited, which is in members'
voluntary liquidation, are required to file their proofs of debt by
Feb. 28, 2022, to be included in the company's dividend
distribution.
The company commenced wind-up proceedings on Jan. 10, 2022.
The company's liquidator is:
Pritesh Patel
Patel & Co
PO Box 23296
Manukau, New Zealand
Email: pritesh@patelandco.co.nz
=====================
P H I L I P P I N E S
=====================
UNITED PEOPLES: Creditors' Claims Deadline Set for Feb. 8
---------------------------------------------------------
Creditors of the closed United Peoples Rural Bank, Inc. have until
February 8, 2022, to file their claims against the bank's assets.
Claims filed after said date shall be disallowed. Creditors refer
to any individual or entity with a valid claim against the assets
of the closed United Peoples Rural Bank, Inc. and include
depositors with uninsured deposits that exceed the maximum deposit
insurance coverage (MDIC) of PHP500,000.
The Philippine Deposit Insurance Corporation (PDIC) said that
creditors may file their claims through any of the following:
1. Online through e-mail at unitedprb-pad@pdic.gov.ph;
2. Through mail addressed to the PDIC Public Assistance Department,
3rd Floor, SSS Bldg., 6782 Ayala Avenue corner V.A. Rufino St.,
Makati City 1226. Claims filed by mail must have a postmark dated
not later than February 8, 2022; or
3. Personal filing on an appointment basis only at the PDIC Public
Assistance Center located at the 3rd Floor, SSS Bldg., 6782 Ayala
Avenue corner V.A. Rufino St., Makati City, Monday to Friday, 8:00
AM to 5:00 PM. Appointments may be requested through the Public
Assistance Hotline at (02) 8841-4141 or at Toll Free number
1-800-1-888-7342 or 1-800-1-888-PDIC, by sending an e-mail request
to unitedprb-pad@pdic.gov.ph, or by sending a request through
private message at PDIC's official Facebook page at
www.facebook.com/OfficialPDIC.
The prescribed Claim Form against the assets of the closed bank may
be downloaded from the PDIC website at
http://www.pdic.gov.ph/files/Claim_Form_Against_Assets_of_Closed_Banks.pdf
PDIC reminds creditors to transact only with authorized PDIC
personnel.
Claims filed after February 8, 2022 shall be disallowed. PDIC, as
Receiver, shall notify creditors of denial of claims through mail.
Claims denied or disallowed by the PDIC may be filed with the
liquidation court within 60 days from receipt of final notice of
denial of claim or within 20 days from date of publication of the
Order setting the Petition for Assistance in the Liquidation
Proceeding for initial hearing, whichever is later.
In addition, PDIC said that depositors with account balances of
more than the maximum deposit insurance coverage (MDIC) of
PHP500,000 who have already filed claims for the insured portion of
their deposits as of February 8, 2022 are deemed to have filed
their claims for the uninsured portion or the amount in excess of
the MDIC.
PDIC, as Receiver of closed banks, requires personal data from
creditors to be able to process their claims and protects these
data in compliance with the Data Privacy Act of 2012.
United Peoples Rural Bank, Inc. was ordered closed by the Monetary
Board (MB) of the Bangko Sentral ng Pilipinas on November 4, 2021
and PDIC, as the designated Receiver, was directed by the MB to
proceed with the takeover and liquidation of the closed bank in
accordance with Section 12(a) of Republic Act No. 3591, as amended.
It is a three-unit rural bank with Head Office located in Salazar
St., Brgy. Poblacion, Candelaria, Quezon. Its two branches are
located in San Pablo, Laguna and Tayabas, Quezon.
All requests and inquiries relating to United Peoples Rural Bank,
Inc. shall be addressed to the PDIC Public Assistance Department
through e-mail at unitedprb-pad@pdic.gov.ph, or through telephone
number (02) 8841-4141. Creditors outside Metro Manila may call the
PDIC Toll Free Hotline during office hours at 1-800-1-888-PDIC
(7342). Inquiries may also be sent as private message to the PDIC's
official Facebook page at www.facebook.com/OfficialPDIC.
=================
S I N G A P O R E
=================
CREARE PTE: Creditors' Proofs of Debt Due on Feb. 11
----------------------------------------------------
Creditors of Creare Pte Ltd, which is in voluntary liquidation, are
required to file their proofs of debt by Feb. 11, 2022, to be
included in the company's dividend distribution.
The company commenced wind-up proceedings on Jan. 5, 2022.
The company's liquidators are:
Lin Yueh Hung
Oon Su Sun
c/o 8 Wilkie Road
#03-08 Wilkie Edge
Singapore 228095
EZRA HOLDINGS: Court to Hear Wind-Up Petition on Jan. 21
--------------------------------------------------------
A petition to wind up the operations of Ezra Holdings Limited will
be heard before the High Court of Singapore on Jan. 21, 2022, at
2:30 p.m.
Goh Thien Phong and Chan Kheng Tek filed the petition against the
company on Dec. 30, 2021.
The Petitioner's solicitors are:
Drew & Napier LLC
Collyer Quay
#10-01 Ocean Financial Centre
Singapore 049315
SINGAPORE AIRLINES: Raises US$600MM From US Dollar Bond Issue
-------------------------------------------------------------
Bloomberg News reports that Singapore Airlines Ltd. became the
first carrier to tap the debt market for dollars in 2022, raising
funds at a discount to peers thanks to its government backing.
The flag carrier sold US$600 million of seven-year bonds to yield
3.493%. That's nearly a percentage point lower than the average
yield at issuance for global airline notes sold in 2021, according
to Bloomberg-compiled data.
Hard-hit like many of its peers due to the pandemic, the airline
has sought to cover expenses by raising SGD22.4 billion via a
rights offering and by issuing debt, Bloomberg states. Singapore's
Temasek Holdings Pte is the largest shareholder.
Bloomberg says the Singapore government's decision last year to
allow entry of fully-vaccinated people from two dozen countries has
given the city state's travel sector a lift.
Singapore Airlines's newly issued bonds "could offer value given
its support from Temasek and ample liquidity, offset by a slower
recovery due to the lack of a domestic market," said Bloomberg
Intelligence analyst Sharon Chen.
Though still way below its pre-pandemic level, the number of
passengers at Changi Airport rose over the course of 2021.
Singapore Airlines recorded a "meaningful increase in traffic,"
though the onset of the omicron coronavirus variant led to a
temporary suspension of quarantine-free travel, according to
Bloomberg.
Singapore Airlines isn't the only Asian carrier looking to tap
funds this week. Korean Air Lines Co. is marketing a Samurai bond,
which is guaranteed by the Export-Import Bank of Korea, at 0.45%.
It is to be priced on Jan. 14, Bloomberg notes.
About Singapore Airlines
Headquartered in Singapore, Singapore Airlines Limited provides air
transportation, engineering, pilot training, air charter, and tour
wholesaling services.
As reported in the Troubled Company Reporter-Asia Pacific in early
December 2021, Egan-Jones Ratings Company, on November 24, 2021,
maintained its 'BB-' local currency senior unsecured ratings on
debt issued by Singapore Airlines Limited.
=================
S R I L A N K A
=================
SRI LANKA: S&P Lowers Sovereign Credit Ratings to 'CCC/C'
---------------------------------------------------------
S&P Global Ratings lowered its long-term sovereign credit rating on
Sri Lanka to 'CCC', from 'CCC+' previously. The outlook is
negative. At the same time, S&P affirmed its 'C' short-term credit
rating.
Outlook
The negative outlook reflects S&P's expectation that Sri Lanka's
external financial position will deteriorate further over the
coming quarters. This would affect Sri Lanka's ability to service
its debt over the next 12 months.
Downside scenario
S&P said, "We could lower our ratings if Sri Lanka's fundraising
activities fall short of government targets or its foreign exchange
reserves erode further beyond our expectations, leading to higher
risk on the sovereign's ability to service debt. We could also
lower the ratings if the government signals its intention to
restructure its outstanding commercial debt, implying that
investors would receive less value than that promised on the
original securities."
Upside scenario
S&P may revise the outlook to stable, or raise the rating, if Sri
Lanka can significantly boost external buffers or its economic
recovery is much stronger than it expects. This could lower the
risks associated with the government's debt-servicing capacity.
Rationale
The downgrade reflects continued deterioration in Sri Lanka's
ability to maintain sufficient foreign exchange resources to meet
elevated external obligations. The Sri Lankan government faces
increasingly likely default scenarios without unforeseen
significant positive developments.
Timely debt service will likely become increasingly difficult over
the next 12 months, given Sri Lanka's vulnerable external profile,
sizable fiscal deficits, heavy government indebtedness, and hefty
interest payments. These factors significantly constrain S&P's
ratings. Macroeconomic policies, including the recent introduction
of a US$1.2 billion relief package, have provided some support to
the pandemic-hit economy. But they have also weakened the
government's fiscal position and worsened the risks associated with
the government's already-high debt burden.
Institutional and economic profile: Economic recovery under
pressure from pandemic, external stresses
-- Sri Lanka's economic recovery will be challenged by the ongoing
pandemic and external financial stresses, hampering consumer
sentiment. This could affect access to capital.
-- S&P forecasts real GDP growth at 2.2% this year, compared with
its estimate of 3.0% expansion in 2021.
-- The government has maintained a supportive fiscal policy stance
despite its weak finances.
Sri Lanka's economy will face sustained headwinds from the pandemic
and external financial conditions this year, limiting its recovery
potential. The Sri Lankan economy contracted by 1.5% year on year
in the third quarter of 2021, reflecting the effects of a severe
wave of COVID-19 in the country that peaked in August. A delayed
reopening of international tourism also weighed on the economy.
In 2020, the government introduced broad-based import controls to
manage foreign exchange outflows, and these are likely to
progressively weigh on affected economic sectors. The Central bank
of Sri Lanka (CBSL) also hiked its standing deposit and lending
facility rates by 50 basis points (bps) in August 2021, in addition
to a subsequent 200 bps hike to its statutory reserve ratio.
Consumer Price Index inflation, which is currently above 11%, is
likely to weigh on consumer sentiment and could place further
downside pressure on the currency over the coming quarters.
The advent of the omicron variant of the coronavirus is leading to
surging case numbers around the world, and this is likely to
further delay the recovery of Sri Lanka's tourism sector. While
domestic case levels remain relatively stable at the time of
publication, the risk of another large COVID-19 wave in Sri Lanka
is considerable.
Given the highly contagious nature of the omicron variant, a steep
escalation in new infections could have a disruptive impact on the
economy, even if it does not severely strain the healthcare system.
Uneven external demand conditions in countries managing record case
numbers could also diminish an important source of support for Sri
Lanka's economy over the next few months.
S&P said, "We forecast the economy will expand 2.2% in real terms
in 2022, following our estimate of 3.0% expansion in 2021, and
growth will likely average 2.7% during 2022-2025. This will bring
per capita income to about US$3,750 in 2022, translating into real
GDP per capita growth of 1.6% on a 10-year weighted-average basis.
While this growth is comparable to peers at a similar income level,
we believe it is substantially below Sri Lanka's potential."
Sri Lanka's current political settings are characterized by a
ruling coalition with a solid parliamentary majority. However,
President Gotabaya Rajapaksa in December 2021 unexpectedly
introduced a measure that will prorogue parliament for an extra
week until Jan. 18, 2022. Cabinet meetings on negotiating a reform
and funding package with the International Monetary Fund (IMF) have
so far ended with no substantive agreement, according to media
reports, indicating differing views among the policymakers
involved.
Flexibility and performance profile: External stress escalating on
higher current and financial account obligations
-- Sri Lanka's external profile has weakened, with reserves facing
consistent pressure from high current and financial account
obligations.
-- Sri Lanka's fiscal deficit is likely to remain elevated even as
the economy gradually recovers.
-- The government's interest burden is likely to remain very high
as its debt level continues to rise in line with its deficits.
Sri Lanka's external position remains a key vulnerability of the
ratings, with its foreign exchange buffer narrowing. While the
central bank's foreign exchange reserves reportedly rose from
approximately US$1.6 billion in November 2021 to US$3.1 billion in
December, this remains slightly less than two months' worth of
import cover. December's reserves were likely boosted by the
central bank's drawdown on a previously agreed Chinese renminbi
(RMB) 10 billion swap facility with the People's Bank of China
(PBoC). Sri Lanka's government has indicated that additional
agreements with other central banks and bilateral lenders are in
the offing, but its deteriorating creditworthiness may complicate
efforts to secure fresh funding.
Additional inflows may be insufficient to offset pre-determined
short-term drains on foreign reserves estimated at US$6.6 billion
over the next 12 months. The ability of the government to secure
additional foreign financing over the next two quarters will be a
key determinant of its ability to prevent a deeper external
liquidity crisis.
Financing conditions on international capital markets remain
challenging for Sri Lanka. These conditions are unlikely to improve
over the next 12 months due to rising inflation pressures, and
prospects of a faster-than-expected policy tightening in advanced
economies. While the government has been able to maintain some
dollar funding via Sri Lanka Development Bonds (SLDBs) purchased by
domestic creditors, demand for these bonds appears to have
diminished. Success in rolling over SLDBs is crucial to the
government's debt-servicing capacity. In turn, this will heavily
depend on domestic creditors' ability to access external financing
under favorable terms, as well as their willingness to continue to
lend to the government.
S&P said, "We estimate that Sri Lanka's current account deficit
rose considerably in 2021 to about 3.4% of GDP versus a shortfall
of just 1.3% in 2020. Higher energy prices are weighing on the
country's goods trade balance, and the delayed recovery of the
international tourism sector is limiting the pace of service export
growth. While we expect Sri Lanka's current account position to
gradually improve over the coming quarters, the shortfall will
place additional pressure on its external liquidity position in
addition to capital and financial account obligations."
Sri Lanka's gross external financing needs as a percentage of
current account receipts plus usable reserves should average 145%
over 2022-2025, in S&P's assessment. S&P also forecasts that Sri
Lanka's external debt net of official reserves and financial sector
external assets will remain elevated at about 163% over the same
period.
Persistent deficits in Sri Lanka's fiscal position will place
additional strain on its ability to meet financial obligations,
absent considerable improvement. With more than 70% of government
revenues required to service interest payments, the government's
heavy debt burden limits its ability to accumulate policy buffers,
which are crucial in times of stress. The COVID-19 pandemic has
further weighed on government finances by dampening domestic
economic activity and lowering excise duty earnings.
Sri Lanka's 2022 budget includes some revenue enhancements,
including an increase in the financial services value-added tax
rate, revisions to excise duties on cigarettes and liquor, and a
one-off surcharge on high-earning individuals and companies. Taken
together, these will boost revenue generation in 2022; however,
additional revenue reforms will likely be required to meaningfully
raise the government's revenue-to-GDP ratio over the next few
years.
The government in January 2022 also announced a US$1.2 billion
relief package, including a special monthly payment to qualifying
public servants, retirees, and military personnel. This package is
likely to push the fiscal deficit higher than the budgeted
shortfall for this year.
S&P said, "We estimate a deficit of 11.1% of GDP for Sri Lanka in
2021, and the government's fiscal shortfall will likely hit 9.8% in
2022. If revenue growth underperforms the government's targets, we
believe capital expenditure may be cut to partially offset the
deficit.
"High fiscal deficits over an extended period will worsen the
government's very high debt levels. We expect the increase in net
general government debt to average 9.3% over 2022-2025 in our base
case, where we assume that the government is able to continue to
raise equivalent financing. Net general government debt exceeded
100% of GDP in 2020 and will continue to increase over the next
five years, in our view. We add the CBSL's drawdown on the PBoC
swapline in our calculation of the government's debt."
Sri Lanka's foreign exchange-denominated debt is vulnerable given
the government's declining foreign exchange reserves and high
repayments. The government faces international sovereign bond
maturities of US$500 million in January 2022 and US$1 billion in
July 2022, in addition to bilateral and official obligations and
SLDBs. The central bank has stated that the funds required for the
repayment of the January 2022 maturity have already been allocated.
Total SLDB maturities in 2022 amount to approximately US$1.45
billion.
A statement published by the office of Sri Lankan President
Gotabaya Rajapaksa on Jan. 9, 2022, indicates that the government
may seek debt restructuring from Chinese creditors. While
additional details are not yet available, Sri Lanka has
considerable official and bilateral borrowings from China. S&P's
issuer credit ratings are assessments of default risk on commercial
debt, rather than on concessional debt contracted from multilateral
or bilateral lenders.
The government has been increasing the share of domestic financing
to fund the fiscal deficit. At the same time, domestic interest
rates have been kept low partially through liquidity injections by
the central bank. While this has capped the effective interest rate
on the government's domestic debt, an increase in domestic
liquidity is also likely to put pressure on the exchange rate. Amid
high inflation and a currency under pressure, the central bank may
hike rates further, potentially pushing the cost of local currency
government debt higher as well. The government's interest burden
remains extremely elevated as a proportion of its revenues. S&P
estimates that this ratio will rise to more than 75% this year, the
highest among rated sovereigns globally.
S&P assesses the government's contingent liabilities from
state-owned enterprises and its relatively small financial system
as limited. However, risks continue to rise due to sustained losses
at Ceylon Petroleum Corp., Ceylon Electricity Board, and Sri Lankan
Airlines. Sri Lankan banks have purchased substantial quantities of
government debt, and the banking sector's aggregate exposure is
more than 20% of system assets.
Sri Lanka's monetary settings remain a credit weakness, and work
toward an updated Monetary Law Act has been suspended since
mid-2021. The credibility and effectiveness of the central bank's
monetary policy will be further tested by high inflation, the
potential for a faster normalization of global monetary conditions,
and the prevailing shortage of foreign exchange in the economy.
In accordance with S&P's relevant policies and procedures, the
Rating Committee was composed of analysts that are qualified to
vote in the committee, with sufficient experience to convey the
appropriate level of knowledge and understanding of the methodology
applicable. At the onset of the committee, the chair confirmed that
the information provided to the Rating Committee by the primary
analyst had been distributed in a timely manner and was sufficient
for Committee members to make an informed decision.
After the primary analyst gave opening remarks and explained the
recommendation, the Committee discussed key rating factors and
critical issues in accordance with the relevant criteria.
Qualitative and quantitative risk factors were considered and
discussed, looking at track-record and forecasts.
The committee's assessment of the key rating factors is reflected
in the Ratings Score Snapshot above.
The chair ensured every voting member was given the opportunity to
articulate his/her opinion. The chair or designee reviewed the
draft report to ensure consistency with the Committee decision. The
views and the decision of the rating committee are summarized in
the above rationale and outlook. The weighting of all rating
factors is described in the methodology used in this rating
action.
Ratings List
DOWNGRADED
TO FROM
SRI LANKA
Transfer & Convertibility Assessment
Local Currency CCC CCC+
SRI LANKA
Senior Unsecured CCC CCC+
SRILANKAN AIRLINES LTD.
Senior Unsecured CCC CCC+
DOWNGRADED; RATINGS AFFIRMED
TO FROM
SRI LANKA
Sovereign Credit Rating CCC/Negative/C CCC+/Negative/C
*********
S U B S C R I P T I O N I N F O R M A T I O N
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