/raid1/www/Hosts/bankrupt/TCRAP_Public/220119.mbx
T R O U B L E D C O M P A N Y R E P O R T E R
A S I A P A C I F I C
Wednesday, January 19, 2022, Vol. 25, No. 8
Headlines
A U S T R A L I A
LIQUITAB SYSTEMS: First Creditors' Meeting Set for Jan. 27
PMM SERVICES: First Creditors' Meeting Set for Jan. 28
SK QLD: First Creditors' Meeting Set for Jan. 27
SPEC-NET PTY: First Creditors' Meeting Set for Jan. 31
C H I N A
AGILE GROUP: S&P Cuts Issuer Rating to 'B+', Sees Liquidity Woes
COUNTRY GARDEN: Buys Back $10 Million of Bonds
HEALTH AND HAPPINESS: Moody's Gives Ba3 Rating to New Senior Notes
HOPSON DEVELOPMENT: Moody's Withdraws B2 Corporate Family Rating
R&F HK: S&P Hikes ICR to 'CC' After Completing Distressed Tender
SHIMAO GROUP: Creditors to Vote on ABS Payment Extension
TIMES CHINA: S&P Downgrades ICR to 'B+', Sees Liquidity Woes
YUZHOU GROUP: Fitch Cuts IDR to 'C' Amid Exchange Offer
YUZHOU GROUP: Offers Debt Exchange Swap to Avoid Default
H O N G K O N G
GENTING HONG KONG: May Seek Liquidation After German Unit's Demise
I N D I A
ANISHA ENTERPRISES: CARE Lowers Rating on INR10cr Loan to C
ASHIANA LANDRAFT: Insolvency Resolution Process Case Summary
ASTITVA CAPITAL: Insolvency Resolution Process Case Summary
BALAJI INDUSTRIES: CARE Cuts Rating on INR5.50cr Loan to C
BASUKINATH FOOD: Insolvency Resolution Process Case Summary
CHAGI AGRO: CARE Reaffirms B+ Rating on INR12.81cr LT Loan
D J AGRO: CARE Lowers Rating on INR74cr LT Loan to D
DEEPAK POLYESTER: CRISIL Keeps B+ Debt Ratings in Not Cooperating
DREAMCITI REALTY: CRISIL Keeps B+ Debt Rating in Not Cooperating
EVERGREEN ENVIRO: Insolvency Resolution Process Case Summary
FINE WOOD: CARE Lowers Rating on INR8.40cr LT Loan to D
GANGA FOUNDATIONS: Insolvency Resolution Process Case Summary
GAV AGRO: ICRA Keeps D Debt Ratings in Not Cooperating Category
INDIAN STEEL: ArcelorMittal India's Affiliate Leads Bidding Race
K. SENTHIL: CRISIL Moves B+ Debt Rating to Not Cooperating
MEMBRANE FILTERS: CARE Lowers Rating on INR19.79cr Loan to C
MITTAL GLOBAL: CRISIL Lowers Rating on INR9cr Loans to B
NILGIRI DAIRY: CARE Reaffirms B Rating on INR10.20cr LT Loan
OMICRON POWER: CARE Keeps C Debt Rating in Not Cooperating
P.M. CARIAPPA: CARE Lowers Rating on INR11.00cr LT Loan to C
PALLA SILKS: CARE Withdraws C Rating on Long Term Bank Debt
PALLA VAJARA: CARE Withdraws D Rating on Long Term Bank Debt
PREMIER AGENCIES: CARE Lowers Rating on INR7.0cr LT Loan to C
RAM CASHEW: CARE Lowers Rating on INR6.0cr LT Loan to C
RAMCO EXTRUSION: CARE Keeps B Debt Rating in Not Cooperating
SB ISPAT INDIA: Insolvency Resolution Process Case Summary
SENCO GOLD: CRISIL Keeps FB+ Deposit Rating in Not Cooperating
SLIPCON ENGINEERING: Insolvency Resolution Process Case Summary
SUBAM TEXTILES: CARE Lowers Rating on INR13.22cr LT Loan to B+
VINIL TRADING: CRISIL Keeps B Debt Rating in Not Cooperating
VIVANTA LABORATORIES: Insolvency Resolution Process to End by May
WORLD WIND: CARE Reaffirms B Rating on INR160.99cr LT Loan
ZIMIDARA PESTICIDES: CARE Keeps B- Debt Rating in Not Cooperating
M A L A Y S I A
AIRASIA GROUP: Fundamentals Improved Despite PN17, Maybank IB Says
MALAYSIA: Bankruptcy & Insolvency Cases Drop 53.6% Over 5 Yrs
N E W Z E A L A N D
CREATORS@HOME LIMITED: Creditors' Proofs of Debt Due on Feb. 8
EXPLEO FARMS: Court to Hear Wind-Up Petition on Feb. 8
SJS CLEANING: Creditors' Proofs of Debt Due on Feb. 8
VAN LIEROP: Court to Hear Wind-Up Petition Feb. 8
S I N G A P O R E
ELLEMENTO FARMING: Creditors' Proofs of Debt Due Feb. 14
NAKE CO: Court to Hear Wind-Up Petition on Jan. 28
VDC HOLDINGS: Commences Wind-Up Proceedings
S R I L A N K A
SRI LANKA: Fitch Corrects December 17 Ratings Release
- - - - -
=================
A U S T R A L I A
=================
LIQUITAB SYSTEMS: First Creditors' Meeting Set for Jan. 27
----------------------------------------------------------
A first meeting of the creditors in the proceedings of Liquitab
Systems Limited will be held on Jan. 27, 2022, at 10:30 a.m. via
virtual meeting.
Matthew Kucianski of Worrells Solvency & Forensic Accountants was
appointed as administrator of Liquitab Systems on Jan. 16, 2022.
PMM SERVICES: First Creditors' Meeting Set for Jan. 28
------------------------------------------------------
A first meeting of the creditors in the proceedings of PMM Services
Pty Ltd will be held on Jan. 28, 2022, at 10:00 a.m. at the offices
of BRI Ferrier Western Australia, Unit, 99-101 Francis Street, in
Northbridge, WA.
Giovanni Maurizio Carrello of BRI Ferrier Western Australia was
appointed as administrator of PMM Services on Jan. 17, 2022.
SK QLD: First Creditors' Meeting Set for Jan. 27
------------------------------------------------
A first meeting of the creditors in the proceedings of SK QLD Pty
Ltd (Formerly known as Jugiter Pty Ltd) will be held on Jan. 27,
2022, at 10:00 a.m. via virtual meeting technology.
Gavin Charles Morton of Morton + Lee Insolvency was appointed as
administrator of SK QLD on Jan. 14, 2022.
SPEC-NET PTY: First Creditors' Meeting Set for Jan. 31
------------------------------------------------------
A first meeting of the creditors in the proceedings of Spec-Net
Pty. Limited will be held on Jan. 31, 2022, at 10:30 a.m. via
teleconference only.
Glenn Thomas O'Kearney of GT Advisory & Consulting was appointed as
administrator of Spec-Net Pty on Jan. 18, 2022.
=========
C H I N A
=========
AGILE GROUP: S&P Cuts Issuer Rating to 'B+', Sees Liquidity Woes
----------------------------------------------------------------
On Jan. 18, 2022, S&P Global Ratings lowered its long-term issuer
credit rating on Agile Group Holdings Ltd. to 'B+' from 'BB-'. The
outlook is negative. At the same time, S&P lowered its long-term
issue rating on the senior unsecured notes Agile issued to 'B' from
'B+'.
The negative outlook on Agile reflects S&P's view that the
company's liquidity could further deteriorate over the next 12
months due to weaker-than-expected cash generation from operations
and asset sales, as well as declining funding access. Also, the
company's leverage could rise due to margin compression.
Agile's repayment pressure is increasing, given its sizable debt
maturities over the next 12 months amid weaker lender confidence.
Continued weak market confidence on the sector and the company will
likely disrupt Agile's plan on refinancing its sizable holding
company level debt. By S&P's estimates, the company has Chinese
renminbi (RMB) 11 billion-RMB12 billion of onshore bonds, offshore
senior notes, and offshore bank borrowings due in the first half of
2022, and RMB6.5 billion-RMB7 billion in the second half of 2022.
That compares with a cash level that it estimates at RMB35
billion–RMB45 billion, of which 25%-35% is readily accessible at
the onshore and offshore holding company level.
S&P said, "Refinancing via offshore banks has also become more
difficult than we had previously expected. This is evident from the
company's muted new offshore loan facilities over the last quarter
of 2021. We believe it will be less likely for Agile to
significantly improve its bank funding access over the next three
to six months.
"We also expect Agile's probability for retapping the capital
market to be remote in the near term due to high market volatility.
There might be limited room for the company to do an exchange bond
issuance similar to the one in November. Agile's holding in
subsidiary A Living Smart City Services Co. Ltd. (A-living) would
be reduced to 47.6% upon exchange. A further reduction may impact
its control. Moreover, A-living's share price has dropped since
then.
"A recovery in Agile's contracted sales supported by Hainan
province could be temporary, in our view. We believe the province
was one of the key contributors of the company's recovering
contracted sales since October. However, the province's traditional
peak sales season is in the winter, and Agile has been expediting
sales with discounts. We also believe the company's sales in Hainan
could face less restrictions on the use of proceeds, given more of
its inventories are close to completed units.
"Agile's sales performance may weaken from the second quarter
onward, in our view, as Hainan's peak sales season comes to an end.
Weak buyer sentiment and a competitive sales environment across the
industry will also pressure its sales. We estimate Agile's
contracted sales will drop to RMB120 billion-RMB130 billion in
2022, from RMB139 billion in 2021. Cash collection is likely to be
79%-81% in 2022."
Agile's ongoing assets monetization plan may cover the funding gap,
but the room for error is reducing. Agile is an asset-rich company
with sizable land bank and multiple business lines with nonproperty
assets. S&P believes monetization plans on some of these will
support the company's debt repayment needs.
S&P said, "We project Agile will generate RMB10 billion-RMB11
billion through asset sales in 2022, including the recently
announced disposal of its noncore properties (mainly commercial
properties). That said, the execution of some key projects is still
at risk, while the company awaits the required approvals. We
estimate Agile generated RMB3 billion–RMB5 billion from asset
sales in the second half of 2021.
"In addition, the company has assets offshore, including its Hong
Kong property development projects and listed subsidiary shares,
which we estimate to be worth RMB11 billion-RMB13 billion. We
believe these assets could be monetized when needed.
"We continue to believe Agile has relatively weak disclosure and
transparency standards. This increases risks over potential
maturities and contingent liabilities, and may lead to a faster
depletion of cash resources and weaken the liquidity position more
than we expected. We also view Agile's acquisitions of stakes in WM
Group as negative, given it reduced the company's liquidity buffer
under the current tight funding condition. We reflect these risks
in a neutral comparable rating analysis, from positive previously,
effectively lowering the issuer credit rating by one notch.
"The negative outlook on Agile reflects our view that company's
cash generation through operations and assets sales over the next
12 months will be weaker than we expected, hurting its liquidity
position. The outlook also reflects Agile's narrowing funding
channels that will weaken its ability to refinance.
"We may downgrade Agile if the company's liquidity and cash
position weakens from the current level. This could arise from
weaker contracted sales and cash collection than we expect, or a
lack of progress in asset sales and funding plans.
"We may also lower the rating if Agile's debt-to-EBITDA ratio
increases above 7x. This could occur due to weaker revenue, margins
than we anticipate, and debt reduction.
"We may revise the outlook to stable if Agile can significantly
improve its funding access and cash position, such that its ability
to weather industry down cycle and repayment pressure increases. At
the same time, the company should maintain its debt-to-EBITDA ratio
below 7x."
COUNTRY GARDEN: Buys Back $10 Million of Bonds
----------------------------------------------
Reuters reports Country Garden, China's biggest homebuilder by
sales, scooped up $10 million of its own bonds on Jan. 17 as the
country's ongoing property crisis sent then sprawling again.
Last week was the worst on record for Country Garden's bonds and
fresh falls of up to 17 points on Jan. 17 left most of its
international market debt at 25%-35% below its face value, Reuters
says.
According to Reuters, analysts cited reports it had dropped plans
to raise $300 million last week after debt market investors had
shown insufficient appetite.
A spokesperson at Country Garden responded to the reports saying
the company had no plan to sell a convertible bond at present.
"It just seems to be the fear factor playing out," Reuters quotes
Seaport Global analyst Himanshu Porwal as saying. "People are just
marking things down as much as they can".
Well after Asian markets closed, the firm said it had bought back
$5 million worth of its July 2022 notes and $5 million of its April
2026 notes from the open market, Reuters relates. It also said it
would make further repurchases "as and when appropriate."
About Country Garden
Country Garden Holdings Company Limited is an investment holding
company principally engaged in the sales of properties. The Company
operates its business through five segments: Property Development
segment, Construction Fitting and Decoration segment, Property
Investment segment, Property Management segment and Hotel Operation
segment. The Company's subsidiaries include Wuhan Country Garden
Lianfa Investment Co., Ltd, Jurong Country Garden Property
Development Co., Ltd and Chuzhou Country Garden Property
Development Co., Ltd.
As reported in the Troubled Company Reporter-Asia Pacific on Sept.
7, 2021, S&P Global Ratings affirmed its 'BB+' long-term issuer
credit rating on Country Garden Holdings Co. Ltd. The positive
outlook reflects S&P's expectation that Country Garden's
disciplined spending and debt growth should mitigate moderate
margin decline and slow revenue growth, producing a stable leverage
over the next 12 months. Country Garden's financial stability
continues to improve.
HEALTH AND HAPPINESS: Moody's Gives Ba3 Rating to New Senior Notes
------------------------------------------------------------------
Moody's Investors Service has assigned a Ba3 senior unsecured
rating to the proposed senior notes to be issued by Health and
Happiness (H&H) International Holdings Limited. (Ba2 negative).
H&H will use the bond proceeds to refinance the Term Loan Facility
and the Senior Revolving Credit Facility which were utilized to
fund a portion of the total amount payable for the acquisition of
Zesty Paws, LLC.
On October 4, 2021, H&H announced the completion of the acquisition
of Zesty Paws.
RATINGS RATIONALE
"The proposed issuance, if successful, will improve H&H's liquidity
profile by securing longer-term funding for the acquisition," says
Shawn Xiong, a Moody's Assistant Vice President and Analyst.
H&H's Ba2 corporate family rating reflects (1) H&H's leading
position among domestic infant milk formula (IMF) and vitamin
providers in China as well as among herbal and mineral supplements
(VHMS) providers in Australia, (2) its resilient operational and
financial profile during the coronavirus pandemic, (3) its expected
free cash flow generation, and (4) its still adequate liquidity
position and track record of deleveraging post large debt-funded
acquisitions.
Although the Zesty Paws acquisition will improve H&H's operational
profile in terms of scale and revenue diversification by bolstering
its pet nutrition and care segment, the strong growth appetite
leads to the substantial increase in debt with limited short-term
earnings contributions, elevating its financial leverage.
Moody's will focus on H&H's projected financial profile, ability to
deleverage following the acquisition of Zesty Paws, the growth of
its core existing businesses and execution of its growth strategy
in its pet nutrition and care (PNC) segment over the next 6-12
months.
At the same time, the ratings remain constrained by (1) the
company's developing scale in competitive markets, and (2)
regulatory and product safety risks.
Moody's forecasts that H&H's revenue will rise 3%-4% for 2021,
driven by (1) the company's expansion of more offline baby
specialty stores, pharmacies and high-end supermarkets in China,
(2) its increased focus on domestic consumption in Australia and
New Zealand, and (3) higher sales contribution from its PNC
segment.
Moody's projects the company's adjusted EBITDA margin to decrease
to around 17-18% over the next 12-18 months from around 19% for
2020. These projections reflect ongoing changes in its product mix,
channels, geographic markets and intensifying competition in some
of the BNC product categories in mainland China. H&H's increasing
sales of goat IMF products, operational deleveraging in Australia
and New Zealand, and ongoing investment in offline baby stores in
China will pressure the company's EBITDA margins over the next
12-18 months.
The factors, together with higher debt from the acquisition of
Zesty Paws, will increase the company's financial leverage, as
measured by adjusted debt/EBITDA, to around 4.6x-4.8x for 2021.
This level of financial leverage is high for its Ba2 CFR.
H&H's liquidity position is adequate. Its cash balance of around
RMB2.45 billion as of September 30, 2021, combined with an expected
annual operating cash flow of RMB1.2-1.3 billion, is sufficient to
cover its short-term debt of RMB20 million, around RMB500 million
of dividend payments and capital expenditure over the next 12
months.
H&H's senior unsecured bond rating is one notch lower than its CFR,
because the bond is subordinated to the senior secured loan
facilities.
In terms of environmental, social and governance (ESG) factors,
H&H's ratings also consider the following.
From a social perspective, H&H benefits from growing demand in IMF
and VHMS in China, driven by changing lifestyles due to
urbanization, rising disposal income and greater awareness of
health and wellness issues partly because of the coronavirus
outbreak.
On the other hand, H&H faces regulatory and product safety risks
because it derives its revenues mainly from IMF and VHMS segments,
which are designed for human consumption. These risks are mitigated
by the company's premium product positioning and focus on quality.
In terms of governance considerations, H&H's ownership is
concentrated in its board chairman Luo Fei as well as other
principal shareholders, who held a 67.07% stake in the company.
This risk is mitigated by the company's status as a listed entity.
There are three independent non-executive directors on the
company's eight-member board. The Zesty Paws acquisition shows
management's willingness to use debt to fund its strong growth
appetite, although H&H has also a track record of deleveraging
following large debt-funded acquisitions.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATING
The negative outlook on the rating reflects Moody's expectation
that H&H's credit metrics will remain elevated over the next 6-12
months, driven by significant acquisition-related debt increases
and slower growth due to strong competition in the BNC segment in
mainland China.
A rating upgrade is unlikely given the negative outlook. However,
the negative outlook could revert to stable if the company (1)
demonstrates a clear plan to deleverage post the acquisition, (2)
achieves strong sales growth in its PNC segment in China and the
US; (3) maintains its solid liquidity position, with sustainable
positive free cash flow, conservative dividend payouts and
cash/short-term debt exceeding 1.5x-2.0x; and (4) deleverages, such
that its debt/EBITDA trends towards 3.5x-4.0x on a sustained basis,
while maintaining steady EBIT margins.
Conversely, the ratings could be downgraded if H&H exhibits (1)
weakening sales or market position; (2) deteriorating profit
margins and sustained weak credit metrics or liquidity because of
increased competition, regulatory changes and aggressive financial
policies; or (3) failure to deleverage and/or execute on the growth
strategy for its PNC segment.
Credit metrics indicative of a downgrade include the company's
adjusted EBIT margin falling below 15%, retained cash flow
(RCF)/net debt decreasing below 15% on a sustained basis and its
adjusted debt/EBITDA not likely trending towards 3.5x-4.0x over the
next 12 to 18 months.
The principal methodology used in this rating was Consumer Packaged
Goods Methodology published in February 2020.
Established in 1999, Health and Happiness (H&H) International
Holdings Limited. is headquartered in Guangzhou and listed on the
Hong Kong Stock Exchange in December 2010. The company is a leading
domestic infant milk formula provider in China and leading
Australian vitamin, herbal and mineral supplements (VHMS) provider.
HOPSON DEVELOPMENT: Moody's Withdraws B2 Corporate Family Rating
----------------------------------------------------------------
Moody's Investors Service has withdrawn the B2 corporate family
rating of Hopson Development Holdings Limited. Prior to the
withdrawal, the rating outlook on Hopson was negative.
RATINGS RATIONALE
Moody's has decided to withdraw the rating for its own business
reasons.
COMPANY PROFILE
Hopson Development Holdings Limited primarily develops residential
properties in cities such as Guangzhou, Beijing, Shanghai, Tianjin
and Huizhou, as well as their surrounding areas. The company had a
land bank of 30.48 million square meters in gross floor area as of
the end of June 2021.
Hopson listed on the Hong Kong Stock Exchange in 1998. Its former
chairman, Chu Mang Yee, owned a 53.26% stake in the company as of
the end of June 2021. Its revenue (excluding revenue from its
equity investment segment) for 2020 was HKD26.3 billion.
R&F HK: S&P Hikes ICR to 'CC' After Completing Distressed Tender
----------------------------------------------------------------
S&P Global Ratings raised its long-term issuer credit rating on R&F
Properties (HK) Co. Ltd. to 'CC' from 'SD'. S&P also affirmed its
rating on Guangzhou R&F Properties Co. Ltd. (Guangzhou R&F) at
'CC'.
S&P said, "We raised our rating on R&F HK after we reassessed the
company's credit profile following the completion of the distressed
tendering and extension on its US$725 million senior unsecured
notes due on Jan. 13, 2022. We affirmed our rating on Guangzhou
R&F."
"Our ratings on Guangzhou R&F and R&F HK reflect our view that the
group companies are exposed to high default risk, owing to
significant maturities in 2022, both onshore and offshore, and the
companies' exceptionally weak liquidity. Repayments for senior
notes during July and December, as well as onshore corporate bonds
due in the first half, are subject to high uncertainty, in our
assessment."
With repayment of about US$608 million of the January notes
extended by six months, both Guangzhou R&F and R&F HK will need to
settle US$896 million of senior notes in July 2022, compared with
the US$725 million due in January 2022 before this distressed
extension. There will be a further US$360 million due in December.
At the same time, the companies will have onshore maturities and
puttable debt of about Chinese renminbi (RMB) 10 billion in 2022,
of which about half is due in the first half. The total onshore and
offshore repayment in 2022 is equivalent to about RMB18 billion.
S&P believes the companies' liquidity will remain exceptionally
tight, given their constrained capacity to use internal resources
for repayment. After settling the tender offer with about US$100
million against the original proposal of US$300 million, and
setting aside funds for upcoming interest payments, the companies'
available offshore cash has been largely consumed, in our
assessment. The shortfall against the July senior notes maturities
is sizable. In addition, the upstreaming of project-level cash is
likely restricted by financial institutions or partners, to protect
their interest and completion and delivery of the projects.
The companies will continue to rely on cash not restricted in
escrow accounts and asset disposals for repayments. This is because
capital markets are largely closed to weaker Chinese developers.
Guangzhou R&F's total contracted sales dropped by about 20% in 2021
amid a tough operating environment, and we project another 15%-20%
decline in contracted sales in 2022. Homebuyers' sentiment is also
likely to be negatively affected by the company's weak
fundamentals.
This will limit the companies' internal cash generation ability and
weaken their market position. Further asset disposals are also
subjected to execution risks, as indicated by recent delays during
the companies' negotiations with counterparties.
S&P said, "We revised our assessment of R&F HK's status within
Guangzhou R&F group to highly strategic from core, reflecting a
slightly diminished likelihood of extraordinary support in some
extreme scenarios. We still believe that Guangzhou R&F will provide
support to R&F HK under almost all foreseeable circumstances."
However, there is a possibility that Guangzhou R&F may prioritize
direct obligations to preserve the group's viability and prevent a
general default if the group enters an extreme distressed state.
That said, R&F HK continues to be an important and near-integral
part of Guangzhou R&F, and accounts for about 30% and 40% of
Guangzhou R&F's total asset and debt, respectively, as of
end-2020.
Guangzhou R&F Properties Co. Ltd.
S&P said, "The negative rating outlook on Guangzhou R&F reflects
our view that the company is highly vulnerable to default on its
outstanding obligations due to its sizable maturity wall and weak
liquidity.
"We could downgrade Guangzhou R&F if the company defaults on its
obligations, including its onshore corporate bond, or announces a
general default.
"We may raise the rating if Guangzhou R&F resolves the repayment
pressure and improves its liquidity. This could be achieved if the
company regains capital market access for refinancing, or secures
significantly more capital through asset disposals or fund raising
than we expect."
R&F Properties (HK) Co. Ltd.
S&P said, "The negative rating outlook on R&F HK reflects the
outlook on its parent, Guangzhou R&F, and our assessment that R&F
HK will remain a highly strategic subsidiary of Guangzhou R&F over
the next 12 months. The outlook also reflects our view that the
company is highly vulnerable to default on its outstanding
obligations.
"We could downgrade R&F HK if the company defaults or undergoes
distressed restructuring on its obligations, including its offshore
senior notes.
"We may raise the rating if R&F HK resolves the repayment pressure
and improves its liquidity."
SHIMAO GROUP: Creditors to Vote on ABS Payment Extension
--------------------------------------------------------
Reuters reports that Shanghai-based Shimao Group will hold online
meetings with creditors in two asset-backed securities (ABS) today,
Jan. 17, to vote on payment extension proposals, according to
documents seen by Reuters on Jan. 13.
Reuters relates that the two onshore ABS products - worth CNY1.17
billion in total - mature later this month but Shimao is seeking to
extend this to the end of 2022 while making some payments in stages
before the new deadline.
Shimao earlier said it has missed payment on a $101 million trust
loan, the report says.
Shimao's onshore subsidiary Shanghai Shimao Co confirmed on
Thursday evening [Jan. 13] it has transferred funds to repay its
4.65% yuan bond with an outstanding principal of CNY1.9 billion
maturing on Jan. 15.
But the firm has yet to say anything on an offshore coupon payment
worth $28 million due on the same day. Shimao has another offshore
coupon of $13 million due Jan. 16 and an onshore coupon of CNY22.5
million due Jan. 19, Reuters adds.
About Shimao Group
Shimao Group Holdings Ltd, formerly Shimao Property Holdings Ltd,
is an investment holding company principally engaged in the sale of
properties. The Company operates its business through four
segments. The Sales of Properties segment is mainly engaged in the
development of residential real estate. The Property Management
Income and Others is mainly engaged in property management. The
Hotel Operation Income segment is mainly engaged in hotel
operations. The Commercial Properties Operation Income segment is
mainly engaged in the development, investment and operation of
commercial, office and industrial park property projects.
As reported in the Troubled Company Reporter-Asia Pacific on Jan.
12, 2022, S&P Global Ratings has lowered its long-term issuer
credit rating on Shimao Group Holdings Ltd. to 'B-' from 'B+'. S&P
also lowered the long-term issue rating on the company's senior
unsecured notes to 'CCC+' from 'B'. S&P placed all the ratings on
CreditWatch with negative implications.
The TCR-AP reported on Jan. 13, 2022, that Fitch Ratings has
downgraded China-based property developer Shimao Group Holdings
Limited's Issuer Default Rating (IDR) to 'B-', from 'BB', and the
senior unsecured rating and outstanding senior unsecured notes to
'B-', from 'BB', and assigned a Recovery Rating of 'RR4'. All
ratings remain on Rating Watch Negative (RWN).
The downgrade is driven by Shimao's lower margin of safety in
preserving liquidity, as evidenced by an announcement by subsidiary
Shanghai Shimao Jianshe Co., Ltd (Shimao Jianshe; not rated) that a
company 30% indirectly owned by Shimao Jianshe had not paid a trust
loan. Shimao Jianshe guarantees the loan. Shimao continues to meet
its public capital-market obligations. Negative news flow continues
to affect market confidence in the company. Shimao's ability to
meet the obligations could be challenged if its access to capital
and contracted sales weaken significantly.
TIMES CHINA: S&P Downgrades ICR to 'B+', Sees Liquidity Woes
------------------------------------------------------------
S&P Global Ratings lowered its issuer credit rating on Times China
Holdings Ltd. to 'B+' from 'BB-'. S&P also lowered its long-term
issue rating on the U.S. dollar-denominated notes that the company
guarantees to 'B' from 'B+'.
The negative outlook reflects S&P's view that Times' liquidity
buffer could reduce further due to slower cash generation from
sales and weaker funding access.
Sales to remain subdued amid weaker market sentiment and Times'
portfolio concentration in the Greater Bay Area. S&P said, "We
expect 2022 sales to remain under pressure as the sector downturn
continues. We forecast Times' contracted sales to decline by 3%-6%
each year in 2022 and 2023, as it will look to maintain cash-flow
stability rather than chasing growth." For December 2021 --
typically the peak selling month for Times -- the company's sales
fell 46% year on year. From July to December 2021, its overall
sales declined by 26% year on year.
Times missed its 2021 sales target, with sales declining for the
first time in eight years. Total contracted sales fell by 4.5% to
Chinese renminbi (RMB) 95.6 billion, from RMB100.4 billion in 2020,
on account of weakening property demand and waning confidence of
homebuyers amid market turmoil.
Lower contribution from Times' urban redevelopment projects (URPs)
to pressure overall margins. S&P said, "Revenue contribution from
URPs will decline to about 10% in 2021, in our assessment, from 14%
in 2020. This is a result of a slowdown in the approval process for
URPs, potentially due to ongoing government elections in the
province of Guangdong. URPs typically offer gross margins of
30%-50%. Therefore, lower contribution from sales of URPs will lead
to thinner overall margins for Times. We estimate gross margin for
the company will drop to 27%-28% in 2021 from 29% in 2020." A sharp
rebound in URPs' contribution in 2022 is unlikely, and margins will
continue to be on a downward trend due to price caps by the
government.
Leverage will increase due to revenue slowdown and a moderate
decline in margins. S&P said, "We now anticipate that Times'
revenue will only rise by 10%-12% in 2021 to RMB42 billion-RMB44
billion, much lower than our previous expectation of a 25%-30%
increase. This is due to construction delays and inconsistent
contribution from its URP segment. Together with compressed margin
levels, leverage will remain above 5x during 2020-2021. Over
2022-2023, we anticipate a decline in revenue by 3%-6% each year to
RMB38 billion-RMB41 billion because of slowing sales."
Despite Times' strategy to control land spending, it needs to
replenish its land bank to maintain scale, and URPs will have
ongoing land conversion expenses. S&P said, "On that basis, and
coupled with slowing sales and margin pressure, we forecast Times'
leverage, as measured by the debt-to-EBITDA ratio, will reach 5.5x
in 2022 and 6.1x in 2023. However, as Times' debt-to-EBITDA ratio
is at the lower end of the highly leveraged spectrum, we capture
that in a one-notch uplift in our positive comparable rating
analysis."
Liquidity buffer reduced due to slowing sales and cash collection.
Declining sales have led to a slowdown in cash collection for
Times. This is indicated by its total cash balance dropping to
RMB26.8 billion as of end-June 2021 from RMB38.0 billion as of
end-2020. S&P said, "We anticipate Times' 2021 year-end cash level
will drop further. Against this, the company has short-term debt
maturities of about RMB11 billion in 2022. Moreover, ongoing
operating expenses including the significant sum of construction
payments around Chinese New Year will further reduce its cash
balance. We estimate 60%-70% of cash is accessible and can be used
for debt repayment. While Times' liquidity is adequate, its buffer
for slippage has reduced, in our view. We estimate the company's
unrestricted cash will be sufficient to fully cover its short-term
maturities."
Significant minority interests could lead to additional cash
outflow when purchasing the minority interests. The company's
non-controlling interest level continued to rise during 2021. It
totaled RMB21.4 billion (52% of equity) as of end-June 2021, rising
from RMB17.1 billion as of end-2020 (47% of equity). As these
project partnerships progress, Times could increase its stake in
them, leading to additional cash outflow or spending. Heavy
reliance on project partnerships with high minority interests could
weigh on Times' cash flow if funding from its partners is not
sustainable. A significant level of minority interests also poses
heightened risks to transparency and disclosures.
S&P said, "The negative outlook reflects our view that Times'
liquidity buffer could reduce further due to slower cash generation
from sales and weaker funding access. In addition, the company's
cash balance could continue to deplete and affect the repayment
visibility of its upcoming maturities.
"We may lower the rating if Times' liquidity tightens with
accessible cash levels dropping further. This could arise from
slower sales and cash collection, weaker funding access, or more
cash being trapped at pre-sale escrow accounts.
"We may also downgrade Times if its consolidated or look-through
(proportionally consolidated) debt-to-EBITDA ratio exceeds 7x
without signs of improvement. Leverage could deteriorate if revenue
recognition and margins are weaker than our expectation, or if the
company fails to control its debt growth due to more aggressive
expansion.
"We may revise the outlook to stable if Times can restore its
liquidity buffer and funding access, such that the company
increases its ability to weather the industry downturn and manage
debt repayments with ease. This may be indicated by a resilient
accessible cash balance due to strong sales and cash collection,
and successful refinancing of its maturities.
"We may also revise the outlook to stable if leverage improves
faster than our expectation such that Times' consolidated and
look-through debt-to-EBITDA ratio stays below 5x. This could occur
if sales performance and revenue recognition improve
significantly."
YUZHOU GROUP: Fitch Cuts IDR to 'C' Amid Exchange Offer
-------------------------------------------------------
Fitch Ratings has downgraded China-based property developer Yuzhou
Group Holdings Company Limited's Long-Term Foreign-Currency Issuer
Default Rating (IDR) to 'C' from 'CCC-'. Fitch has also downgraded
the company's senior unsecured rating to 'C' from 'CCC-' with the
Recovery Rating remaining at 'RR4'.
The downgrades follow Yuzhou's announcement that is has launched an
offer to exchange two bonds, due on 23 January 2022 and 25 January
2022 with outstanding amounts of USD242 million and USD340 million,
respectively. Fitch considers this a distressed debt exchange (DDE)
as per Fitch's criteria.
The IDR will be downgraded to 'RD' (Restricted Default) if the
proposed exchange offer is successfully carried out, and Fitch will
subsequently re-rate Yuzhou's IDRs to a level that is consistent
with the company's post-exchange capital structure and risk
profile, which would be likely to be within a very low
speculative-grade range.
KEY RATING DRIVERS
Exchange Offer Constitutes a DDE: Fitch classifies a debt exchange
as a DDE if the exchange imposes a material reduction in terms
compared with the original contractual terms; and the exchange is
conducted to avoid bankruptcy, similar insolvency or intervention
proceedings, or a traditional payment default. The terms of
Yuzhou's offer meet both of these conditions.
Offer to Avoid Payment Default: Fitch believes the exchange offer
will help Yuzhou to avoid a default in light of its tight
liquidity. The company's cash and cash equivalents came down to
around CNY21 billion by end-June 2021, while its ability to access
the cash for bond repayment is limited. Fitch believes a majority
of the cash is likely to be at the project level, but Fitch is
unable to verify this with the company. The exchange offer
memorandum also states that the company may not be able to repay
the existing notes if the exchange is unsuccessful.
Material Reduction in Terms: Out of USD1,000 principal of the two
notes, USD50 principal repayment will be in cash, USD10 in cash,
and USD950 in aggregate principal amount of the new notes. The
company is also proposing to combine the two notes due in January
2021 to USD950 new notes with an interest rate of 7.8125% maturing
in January 2023.
Fitch believes the exchange offer constitutes a material reduction
in the terms of the existing notes as the repayment is being made
in the form of new notes with an extended maturity date. In
addition, the new notes remove some of the restrictive covenants of
the existing notes.
Conditions of Exchange Offer: The company's obligation to
consummate the exchange offer is conditional upon, among other
things, the bondholders tendering not less than 90% in aggregate of
the outstanding principal amount of the existing notes. The company
reserves the right to amend, modify or waive, at any time, the
terms and conditions of the exchange offer.
Yuzhou has an ESG Relevance Score of '4' for Group Structure due to
a high share of contracted sales from unconsolidated joint ventures
and associates, which has a negative impact on the credit profile,
and is relevant to the ratings in conjunction with other factors.
Unless otherwise disclosed in this section, the highest level of
ESG credit relevance is a score of '3'. This means ESG issues are
credit-neutral or have only a minimal credit impact on the entity,
either due to their nature or the way in which they are being
managed by the entity.
DERIVATION SUMMARY
Yuzhou's ratings reflect its DDE offer.
KEY ASSUMPTIONS
-- Total annual contracted sales of CNY95 billion-105 billion in
2021-2024 (2020: CNY105 billion), with a consolidated ratio in
the 35%-40% range;
-- The average selling price to rise by 2%-9% a year on average
in 2021-2024, from CNY16,756/square metre in 2020;
-- Land bank life to remain below 2.0 years in 2021-2022 (2020:
2.5 years);
-- Stable land costs over 2021-2023;
-- Selling, general and administrative expenses at 2.8% of
contracted sales in 2021-2023;
KEY RECOVERY RATING ASSUMPTIONS
Liquidation Approach
-- 10% administrative claim;
-- 70% advance rate to accounts receivable;
-- 20% advance rate to investment properties, as the 1H21
annualised rental yield was only 1.3%;
-- 60% advance rate to adjusted inventory, based on our
expectation of an EBITDA margin of around 13%;
-- 60% advance rate to net property, plant and equipment;
-- 100% advance rate to restricted cash. Restricted cash is for
the normal operation and loan repayments of specific projects
and is unavailable for non-operational activities, like
investment or profit sharing;
-- Fitch does not assume available cash in excess of outstanding
trade payables would be available for other debt-servicing
purposes, and therefore the advance rate for excess cash is
0%.
The Recovery Rating is capped at 'RR4' because, under Fitch's
Country-Specific Treatment of Recovery Ratings Criteria, China
falls into Group D of creditor friendliness, and instrument ratings
of issuers with assets in the group are subject to a soft cap at
the issuer's Issuer Default Rating and Recovery Rating of 'RR4'
Guarantees to joint ventures are excluded from the recovery
calculation.
RATING SENSITIVITIES
Factor that could, individually or collectively, lead to positive
rating action/upgrade:
-- Fitch will reassess Yuzhou's capital structure and cash flow
if Yuzhou repays the debt maturities, to determine its IDR and
senior unsecured ratings.
Factor that could, individually or collectively, lead to negative
rating action/downgrade:
-- Fitch will downgrade Yuzhou's IDR to 'RD' if the exchange
offer is completed, or if it fails to meet any of its debt
obligations.
BEST/WORST CASE RATING SCENARIO
International scale credit ratings of Non-Financial Corporate
issuers have a best-case rating upgrade scenario (defined as the
99th percentile of rating transitions, measured in a positive
direction) of three notches over a three-year rating horizon; and a
worst-case rating downgrade scenario (defined as the 99th
percentile of rating transitions, measured in a negative direction)
of four notches over three years. The complete span of best- and
worst-case scenario credit ratings for all rating categories ranges
from 'AAA' to 'D'. Best- and worst-case scenario credit ratings are
based on historical performance.
ISSUER PROFILE
Yuzhou develops projects in six metropolitan areas in the Yangtze
River Delta region, West Strait Economic Zone, Bohai Rim region and
Greater Bay Area as well as in China's central and south-west
regions. The group is the leading property enterprise in Xiamen in
southern China and the Yangtze River Delta. The company had 179
projects at end-1H21, with total floor area of 22 million sq m.
SUMMARY OF FINANCIAL ADJUSTMENTS
Fitch has excluded deposits in designated accounts from cash in
Fitch's leverage calculation and included this as inventory.
Restricted bank deposits are included in cash to calculate net
debt, as these are mainly pledged for obtaining bank loans.
ESG CONSIDERATIONS
Yuzhou Group Holdings Company Limited has an ESG Relevance Score of
'4' for Group Structure due to a high share of contracted sales
from unconsolidated joint ventures and associates, which has a
negative impact on the credit profile, and is relevant to the
rating[s] in conjunction with other factors.
Unless otherwise disclosed in this section, the highest level of
ESG credit relevance is a score of '3'. This means ESG issues are
credit-neutral or have only a minimal credit impact on the entity,
either due to their nature or the way in which they are being
managed by the entity.
YUZHOU GROUP: Offers Debt Exchange Swap to Avoid Default
--------------------------------------------------------
South China Morning Post reports that China's crushing "three red
lines" policy against home developers continues to claim new
victims as Yuzhou Group turned to creditors for forbearance on more
than US$5 billion of debt from years of unrestrained offshore
borrowing.
The group is offering sweeteners to bondholders to delay repayment
by a year on two dollar-denominated bonds worth US$582 million in a
debt exchange plan, according to an exchange filing, citing
significant short-term liquidity pressure, the Post relays. The
notes are due this month.
The Post relates that Yuzhou is also seeking approval from
creditors to weaken the covenants on a dozen other offshore debts
worth about US$4.92 billion, it added. Coupon payments totalling
US$110 million on five other notes due within the next seven weeks
are likely to be delayed, the company said.
According to the Post, the debacle adds to a string of defaults and
distress among its mainland Chinese peers, including a handful in
its base in southern Guangdong province, such as China Evergrande,
Kaisa Group and R&F Properties. China introduced leverage caps on
highly indebted developers in August 2020 to stem systemic risk,
shutting many of them out of the funding market.
"[The company] does not expect to have sufficient funds to repay
note holders who do not agree to the exchange, which would likely
trigger an event of default," it said in a filing to the stock
exchange on Jan. 13, the report relays.
Under the debt swap, the Shenzhen-based developer offered to pay a
US$50 upfront payment for every US$1,000 of the face value of the
two bonds. The balance will be exchanged into new January 2023
notes paying 7.8125 per cent interest, according to the Post.
The two securities involved are US$340 million of 8.65 per cent
notes due on January 23 and US$242 million of 6 per cent notes due
on January 25. The swap will come with a US$10 incentive fee on
every US$1,000 of debt for consenting creditors.
Yuzhou is also concurrently soliciting consent from bondholders to
waive certain event-of-default clauses in 12 other bonds maturing
in 2022 through 2027. It offered to pay a US$2.50 incentive fee for
every US$1,000 of the face amount.
According to the Post, Yuzhou said it cannot assure investors it
will be able to make payments to avoid default. Given the stress in
the sector, the move will help extend its debt maturity profile and
strengthen its balance sheet, it added.
The Post notes that like other distressed peers, Yuzhou is also
trying to raise money by selling its property-management services
business. However, the process is time-consuming and would not fend
off fast-maturing debt.
"Reduced bank lending for mortgage finance for buyers, as well as
concerns of buyers about the ability of property developers to
complete projects, have resulted in reduced property sales," Yuzhou
said.
The company recorded a flattish CNY105 billion in accumulated home
sales in 2021, it said in a filing on January 10. Sales rose 40 per
cent in 2020 to CNY104.9 billion, the Post discloses.
About Yuzhou Group
Yuzhou Group Holdings Company Limited is a property developer that
focuses on residential housing in the Yangtze River Delta and the
West Strait Economic Zone. Established in Xiamen in the mid-1990s,
Yuzhou is one of the city's largest developers. The company moved
its headquarters to Shanghai in 2016.
As reported in the Troubled Company Reporter-Asia Pacific on Jan.
12, 2022, Fitch Ratings has downgraded Yuzhou Group Holdings
Company Limited's Long-Term Foreign-Currency Issuer Default Rating
(IDR) to 'CCC-' from 'B'/Negative. Fitch has also downgraded the
senior unsecured rating and the ratings on the outstanding
US-dollar senior unsecured notes to 'CCC-', from 'B', with a
Recovery Rating of 'RR4'.
The downgrade reflects the diminishing likelihood of Yuzhou
refinancing its USD590 million public senior notes due January 2022
and the difficulty the company is likely to face in addressing its
capital-market maturity wall in the next six to nine months, given
its limited funding access.
The TCR-AP reported on Jan. 12, 2022, that Moody's Investors
Service has downgraded the corporate family rating (CFR) of Yuzhou
Group Holdings Company Limited to Caa2 from B2. At the same time,
Moody's has downgraded the company's senior unsecured rating on the
bonds to Caa3 from B3. The outlook on the ratings remains
negative.
=================
H O N G K O N G
=================
GENTING HONG KONG: May Seek Liquidation After German Unit's Demise
------------------------------------------------------------------
Bloomberg News reports cruise operator Genting Hong Kong Ltd warned
it may seek court assistance to safeguard its assets, after failing
to secure funding to help it stay afloat following the insolvency
of its German shipbuilding subsidiary.
Genting Hong Kong plans to file for provisional liquidation with
courts in Bermuda, where its registered office is, unless it
receives "credible proposals for a solvent, consensual and
inter-conditional restructuring solution", it said in an exchange
filing, according to Bloomberg. The company's shares, down 49%
already this year, have also been suspended from trade.
Genting Hong Kong's indirect wholly owned shipbuilding subsidiary,
MV Werften, has filed for insolvency in a local court in Germany,
the report notes, after salvage talks fizzled amid a dispute
between German authorities and Genting. Both parties blamed the
other for MV Werften's collapse. Genting Hong Kong warned investors
cross defaults amounting to US$2.78 billion may follow.
According to MV Werften's website, the shipbuilder has around 2,900
staff and over the past 75 years has delivered more than 2,500
vessels for deployment in the tourism sector, the Arctic region and
the logistics and offshore marine industries from its shipyards in
Wismar, Rostock and Stralsund.
Bloomberg notes Genting Hong Kong's financial deterioration is also
the result of Covid-19, which has wiped out travel demand, causing
the industry to carry out a string of restructuring and
insolvencies. Genting Hong Kong, which like many operators has
offered "seacations" amid a cruise-to-nowhere trend, reported a
record loss of US$1.7 billion in May, Bloomberg discloses. The
latest liquidation developments come just as Hong Kong reimposes
some of its strictest virus curbs since the pandemic began.
According to Bloomberg, Genting Hong Kong said on Jan. 18 a German
court had rejected an application that would have provided MV
Werften with access to an US$88 million lifeline.
"The company considers that it has exhausted all reasonable efforts
to negotiate with the relevant counterparties under its financing
arrangements," it said in the statement.
"The appointment of provisional liquidators is essential and in the
interests of the company, its shareholders and its creditors in
order to maximise the chance of success of the financial
restructuring and to provide a moratorium on claims and to seek to
avoid a disorderly liquidation of the company by any of its
creditors," it added.
Some of Genting Hong Kong's biggest creditors have included banks
such as BNP Paribas SA, Oversea-Chinese Banking Corp and Credit
Agricole SA and DNB Bank ASA, data compiled by Bloomberg show.
The company's impending demise may not necessarily have big
ramifications for other companies in the Genting group, says
Bloomberg. Part of Tan Sri Lim Kok Thay's sprawling
gambling-to-hospitality Genting empire, Genting Hong Kong was
established in the early 1990s when the Malaysian tycoon wanted to
diversify risk away from the flagship hilltop casino resort in his
home country.
While Lim owns a 76% stake in Genting Hong Kong, the other Genting
companies in Malaysia and Singapore - Genting Bhd, Genting
Singapore Ltd and Genting Malaysia Bhd - have no cross
shareholdings with Genting Hong Kong except for Lim being a common
stakeholder in all four, Bloomberg states. Cruises out of Hong
Kong are only one part of Genting Hong Kong's business. Responding
to questions from Bloomberg News on Jan. 18, the company said
cruises were still taking place in Singapore, Taiwan and Penang in
Malaysia, with most of those voyages having resumed at reduced
capacity in 2020. The company wasn't immediately able to disclose
what proportion of its business cruises from Hong Kong typically
account for.
Separately on Jan. 18, Genting Hong Kong said Alan Smith, Ambrose
Lam Wai Hon and Justin Tan have resigned as independent
non-executive directors and as such have ceased to be members of
the company's audit, remuneration and nomination committees,
Bloomberg reports.
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
=========
ANISHA ENTERPRISES: CARE Lowers Rating on INR10cr Loan to C
-----------------------------------------------------------
CARE Ratings revised the ratings on certain bank facilities of
Anisha Enterprises (AE), as:
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long Term Bank 10.00 CARE C; Stable; ISSUER NOT
Facilities COOPERATING; Rating continues
to remain under ISSUER NOT
COOPERATING category and
Revised from CARE B; Stable
Detailed Rationale & Key Rating Drivers
CARE had, vide its press release dated January 11, 2021, placed the
rating(s) of AE under the 'issuer noncooperating' category as AE
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. AE continues to be
non-cooperative despite repeated requests for submission of
information through e-mails, phone calls and a letter/email dated
November 27, 2021, December 7, 2021, December 17, 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).
The ratings assigned to the bank facilities of AE have been revised
on account of non-availability of requisite information.
Anisha Enterprises (AE) was established and started the commercial
operations in the year May 2017 by Mr. Srimannarayana as a
proprietorship concern. Initially, the firm was engaged in the
business of trading of Tobacco, Pulses and Shrimp. At present
the firm is engaged in the wholesale and retail trading of
different kinds of pulses and shrimp. The firm generates 95% of the
revenue from the trading of pulses and remaining 5% from sale of
shrimp. The firm sells both pulses and shrimp in the states of
Andhra Pradesh and purchases the same from the farmers located
around Prakasham district, Andhra Pradesh.
ASHIANA LANDRAFT: Insolvency Resolution Process Case Summary
------------------------------------------------------------
Debtor: Ashiana Landcraft Realty Private Limited
5F, Everest 46/C
Chowringhee Road
Kolkata
West Bengal, India 700071
Insolvency Commencement Date: January 11, 2022
Court: National Company Law Tribunal, Mumbai Bench
Estimated date of closure of
insolvency resolution process: July 10, 2022
Insolvency professional: Jayesh Natvarlal Sanghrajka
Interim Resolution
Professional: Jayesh Natvarlal Sanghrajka
C/o Jayesh Sanghrajka & Co. LLP
405-407, Hind Rajasthan Building
95, Dada Saheb Phalke Road
Dadar East, Mumbai 400014
Maharashtra, India
E-mail: jasyesh@jasandco.in
cirp.ashiana@gmail.com
Classes of creditors: Allottees under a Real Estate Project
as per clause (f) of section 5(8)
Insolvency
Professionals
Representative of
Creditors in a class: Mr. Hemant Mehta
Mr. Madam Vaishnawa
Mr. Ashok Kumar Gupta
Last date for
submission of claims: January 25, 2022
ASTITVA CAPITAL: Insolvency Resolution Process Case Summary
-----------------------------------------------------------
Debtor: Astitva Capital Market Private Limited
Flat No. 307, 3rd Floor
New Delhi House
Barakhamba Road
New Delhi 110001
Insolvency Commencement Date: November 25, 2021
Court: National Company Law Tribunal, Delhi Bench
Estimated date of closure of
insolvency resolution process: June 7, 2022
(180 days from commencement)
Insolvency professional: Gaurav Srivastava
Interim Resolution
Professional: Gaurav Srivastava
Flat No. 908, Charms Solitaire
Ahinsa Khand-2, Indira Puram
Ghaziabad
E-mail: srivastava.law@gmail.com
astitvacapitalmarket@gmail.com
Last date for
submission of claims: December 23, 2021
BALAJI INDUSTRIES: CARE Cuts Rating on INR5.50cr Loan to C
----------------------------------------------------------
CARE Ratings revised the ratings on certain bank facilities of
Balaji Industries_Mysore (BI), as:
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long Term Bank 5.50 CARE C; Stable; ISSUER NOT
Facilities COOPERATING; Rating continues
to remain under ISSUER NOT
COOPERATING category and
Revised from CARE B-; Stable
Detailed Rationale & Key Rating Drivers
CARE had, vide its press release dated January 11, 2021, placed the
rating(s) of BI under the 'issuer non-cooperating' category as BI
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. BI continues to be
non-cooperative despite repeated requests for submission of
information through e-mails, phone calls and a letter/email dated
November 27, 2021, December 7, 2021 and December 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 assigned to the bank facilities of BI have been revised
on account of non-availability of requisite information.
Mysore (Karnataka) based, Balaji Industries (BI) was established on
May 10, 2012 and promoted by Mr. D. V. Narayana. The firm is mainly
engaged in processing of Bengal fried gram and polishing gram.
BASUKINATH FOOD: Insolvency Resolution Process Case Summary
-----------------------------------------------------------
Debtor: Basukinath Food Processors Limited
4, BBD Bag, Stephen House
5th Floor, Room 87A
Kolkata 700001
West Bengal, India
Insolvency Commencement Date: January 11, 2022
Court: National Company Law Tribunal, Kolkata Bench
Estimated date of closure of
insolvency resolution process: July 9, 2022
Insolvency professional: Rajesh Lihala
Interim Resolution
Professional: Rajesh Lihala
11, Crooked Lane
Kolkata 700069
West Bengal, India
E-mail: lihalaco@gmail.com
Last date for
submission of claims: January 26, 2022
CHAGI AGRO: CARE Reaffirms B+ Rating on INR12.81cr LT Loan
----------------------------------------------------------
CARE Ratings reaffirmed ratings on certain bank facilities of Chagi
Agro Industries Private Limited (CAIPL), as:
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long Term Bank
Facilities 12.81 CARE B+; Stable Reaffirmed
Long Term/
Short Term
Bank Facilities 6.19 CARE B+; Stable/CARE A4
Reaffirmed
Detailed Rationale & Key Rating Drivers
The rating assigned to the bank facilities of the CAIPL factors in
gradual ramp up in its operations but it continues to remain small
in a highly fragmented and competitive industry. The rating is also
constrained by leveraged capital Structure with CAIPL planning to
avail additional debt, moderate debt coverage indicators and
Working capital intensive nature of operations along with agro
climatic risks. Seasonal nature of availability of paddy and
margins susceptible to raw material price fluctuations and
Regulations by Government also constrains the rating. These rating
weaknesses are partially offset by the long track record of the
promoters in the similar line of business, established association
with suppliers and customers and stable outlook demand for rice.
Rating Sensitivities
Positive Factors - Factors that could lead to positive rating
action/upgrade:
* Ability to achieve the scale of operations of INR55 crores.
* Ability to maintain the PBILDT margins > 10% and overall
gearing below 2x on sustained basis
Negative Factors- Factors that could lead to negative rating
action/downgrade:
* Overall gearing beyond 3.00x
* Decline in the PBILDT margin to less than 5%.
Detailed description of the key rating drivers
Key Rating Weaknesses
* Small scale of operations and satisfactory profitability margins
CAIPL has achieved a total Operating income of INR20.22 Cr in FY21
being its first year of operations. In 9MFY22, the company has
achieved a turnover of INR45.43 Cr. While PBILDT and PAT margins of
the company were satisfactory at 11.89% and
5.77% in FY21, its ability to sustain the same over the period
remains to be seen.
* Leveraged capital Structure and moderate debt coverage
indicators: Overall gearing of the company stood at 2.96x as of
March 31, 2021 on account of increase in the term loans, GECL loans
used for the purpose of meeting operational liabilities and term
loan for purchasing solar panels. The networth of the company also
stood low at INR2.40 Cr. Total debt to GCA of the company stood at
3.59x as of March 31, 2021 and interest coverage ratio stood at
8.52x as of March 31, 2021.
* Working capital intensive nature of operations along with agro
climatic risks: Paddy in India is harvested mainly at the end of
two major agricultural seasons Kharif (June to September) and Rabi
(November to April). The millers have to stock enough paddy by the
end of each season as the price and quality of paddy is better
during the harvesting season. During this time, the working capital
requirements of the rice millers are generally on the higher side.
Majority funds of the Company are blocked in inventory. The Company
avails credit period of 60-90 days from its
suppliers and extends credit up to 40 days to its customers. The
company's average utilization of working capital stood at 90%
during last 12 months ended December 31, 2021.
* Seasonal nature of availability of paddy and margins susceptible
to raw material price fluctuations and Regulations by Government:
The major procurement of Paddy happens during the months of October
to January and April to July. The firm's raw material being paddy,
for proper harvest and availability of paddy, the weather
conditions should be adequate. Adverse weather conditions directly
affect the supply and availability of the paddy and raw material
price fluctuations. The central Government of India (GOI), every
year decides a minimum support price of paddy which limits the
bargaining power of rice millers over the farmers. The sale of rice
in the open market is also regulated by the government through levy
quota and fixed prices. Due to the above-said regulations along
with the intense competition, the argaining power of the rice
millers against the suppliers of paddy and the customers is
limited.
* Highly fragmented and competitive business segment due to
presence of numerous players: The Company is engaged into a
fragmented business segment and competitive industry. The market
consists of several small to medium-sized firms that compete with
each other along with several large enterprises. There are several
small-sized firms in and around Siruguppa area which compete with
CAIPL.
Key Rating Strengths
* Long track record of the promoters: The promoters Mr. Chagi Vinay
and Mr. Chagi Subbaiah Setty are in the business of rice milling
for more than 2 decades through group Company Chagi Narasaiah Agro
foods which had turnover of around Rs 42 Cr in FY21. The rich
experience of the promoters will aid in improving the scale of
operations of CAIPL.
* Established association with suppliers and customers: The company
has established relations with the customers in and around the
state of Karnataka due to long track record of the promoters in the
similar field of business which is evident from the TOI of INR20 Cr
in its first year of operations by CAIPL.
* Stable outlook demand for rice: Agriculture is the primary source
of livelihood for about 58 percent of India's population. The
Indian food industry is poised for huge growth, increasing its
contribution to world food trade every year due to its immense
potential for value addition, particularly within the food
processing industry. Rice is consumed in large quantity in India
which provides favorable opportunity for the rice millers and thus
the demand is expected to remain healthy over medium to long term.
India is the second largest producer of rice in the world after
China and the largest producer and exporter of basmati rice in the
world. The rice industry in India is broadly divided into two
segments – basmati (drier and long grained) and non-basmati
(sticky and short grained). Demand of Indian basmati rice has
traditionally been export oriented where the South India caters
about one-fourth share of India's exports. However, with a growing
consumer class and increasing disposable incomes, demand for
premium rice products is on the rise in the domestic market. Demand
for non-basmati segment is primarily domestic market driven in
India. Initiatives taken by government to increase paddy acreage
and better monsoon conditions will be the key factors which will
boost the supply of rice to the rice processing units.
Liquidity: Stretched
The liquidity profile of the company is marked by the high working
capital utilization limit to the extent of 90% during last 12
months ending December 31, 2021 and modest cash and bank balance of
INR0.48 crore as of March 31,2021 (Prov.).
Chagi Agro Industries private limited (CAIPL) is established in
October 2019 and has started commercial operations from March 2020.
The company is into rice milling and processing and the promoter
has the business vintage of over two decades in the
rice milling business through group Company Chagi Narasaiah Agro
foods. It has production capacity of 6 M.T per hour.
D J AGRO: CARE Lowers Rating on INR74cr LT Loan to D
----------------------------------------------------
CARE Ratings revised the ratings on certain bank facilities of D J
Agro Industrial Project Private Limited, as:
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long Term Bank
Facilities 74.00 CARE D Revised from CARE BB-;
Stable
Detailed Rationale & Key Rating Drivers
The revision in the rating assigned to the bank facilities of D J
Agro Industrial Project Private Limited takes into account the
delay in servicing of interest of the term loan for the period up
to October 2021. The rating is also constrained by delay in project
implementation, susceptibility of profitability to volatility in
raw-material prices, highly fragmented industry with low entry
barriers and exposure to risk related to the regulated nature of
jute industry.
Rating Sensitivities
Positive Factors - Factors that could lead to positive rating
action/upgrade:
* Regularization of debt servicing for a continuous period of 3
months.
Detailed description of the key rating drivers
Key Rating Weaknesses
* Delay in debt servicing: There has been delay in the servicing of
interest component of term loan for the period up to October'21. As
discussed with the banker, the interest servicing has been
regularized, with slight delay. The account is regular now.
* Delay in project implementation: The Company has set up a jute
mill of 50 tpd. Earlier, the project was envisaged to commence from
October 2020, however due to lockdown imposed amid COVID-19
pandemic, the execution was delayed. The project completed the
trial run in February 2021 and the project has started commercial
operation from March 15, 2021. The project is expected to be funded
through promoters' fund of INR36.93 crore, term loan of INR44.00
crore and interest free unsecured loan from group companies of
INR6.84 crore. As on March 1, 2021, the company has already spent
INR79.02 crore on the aforesaid project which has been funded
through term loans to the tune of INR39.79 crore, promoters'
contribution of INR34.99 crore, unsecured loan of INR3.21 crore and
sundry creditors of INR1.03 crore.
* Susceptibility to volatility in raw-material prices: Raw-material
(i.e. raw jute) is the largest cost component of jute bags and the
same is expected to be ~70% of cost of sales. The price of raw-jute
is volatile in nature due to agro-commodity nature of product
(which is dependent upon vagaries of nature). Given that raw-jute
is the largest cost driver and the prices of same are volatile in
nature, the profitability margin is susceptible to fluctuation in
prices of raw material.
Liquidity: Poor
There has been delay in servicing of interest on term loan post
moratorium.
D J Agro Industrial Project Private Limited (DJAIPPL) was
incorporated in April 2012 with an objective to enter into the
business of manufacturing of jute bags from raw jute. The
manufacturing unit of the company is located at Mandakata (North
Guwahati, Assam) with a proposed installed capacity of 50 Metric
Ton Per Day (17,500 tpa). Promoters of the company, Mr. Dipjyoti
Mahanta and Mrs. Mili Mahanta having long experience in similar
line of business, proposes to look after the day to day operation
of the company along with adequate support from a team of
experienced personnel. The company also has three associate
companies in the name of "Apex Yarn Private Limited", "Ashoka
Weaving Private Limited" and "Atlanta Modular Private Limited". All
the three companies were incorporated on August 7, 1997.
DEEPAK POLYESTER: CRISIL Keeps B+ Debt Ratings in Not Cooperating
-----------------------------------------------------------------
CRISIL Ratings said the ratings on bank facilities of Deepak
Polyester Private Limited (DPPL) continue to be 'CRISIL B+/Stable
Issuer Not Cooperating'.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Cash Credit 7 CRISIL B+/Stable (Issuer Not
Cooperating)
Term Loan 2.11 CRISIL B+/Stable (Issuer Not
Cooperating)
CRISIL Ratings has been consistently following up with DPPL for
obtaining information through letters and emails dated October 16,
2021 and December 4, 2021 among others, apart from telephonic
communication. However, the issuer has remained non cooperative.
'The investors, lenders and all other market participants should
exercise due caution with reference to the rating assigned/reviewed
with the suffix 'ISSUER NOT COOPERATING' as the rating is arrived
at without any management interaction and is based on best
available or limited or dated information on the company. Such non
co-operation by a rated entity may be a result of deterioration in
its credit risk profile. These ratings with 'ISSUER NOT
COOPERATING' suffix lack a forward looking component.'
Detailed Rationale
Despite repeated attempts to engage with the management, CRISIL
Ratings failed to receive any information on either the financial
performance or strategic intent of DPPL, which restricts CRISIL
Ratings' ability to take a forward looking view on the entity's
credit quality. CRISIL Ratings believes that rating action on DPPL
is consistent with 'Assessing Information Adequacy Risk'. Based on
the last available information, the ratings on bank facilities of
DPPL continues to be 'CRISIL B+/Stable Issuer Not Cooperating'.
DPPL was incorporated in 2012 to take over the business of
partnership firm Deepak Polyester, which was set up in 2002. DPPL
manufactures texturised and twisted polyester yarn and knitted
fabric. Its registered office is in Mumbai and manufacturing
facility is in Silvassa (Union Territory of Dadra & Nagar Haveli).
The company is owned and managed by Mr. Bajranglal Joshi and Mr.
Sanjeev Kapoor.
DREAMCITI REALTY: CRISIL Keeps B+ Debt Rating in Not Cooperating
----------------------------------------------------------------
CRISIL Ratings said the rating on bank facilities of Dreamciti
Realty Private Limited (Dreamciti) continues to be 'CRISIL
B+/Stable Issuer Not Cooperating'.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Cash Credit 8 CRISIL B+/Stable (Issuer Not
Cooperating)
CRISIL Ratings has been consistently following up with Dreamciti
for obtaining information through letters and emails dated October
16, 2021 and December 4, 2021 among others, apart from telephonic
communication. However, the issuer has remained non cooperative.
'The investors, lenders and all other market participants should
exercise due caution with reference to the rating assigned/reviewed
with the suffix 'ISSUER NOT COOPERATING' as the rating is arrived
at without any management interaction and is based on best
available or limited or dated information on the company. Such non
co-operation by a rated entity may be a result of deterioration in
its credit risk profile. These ratings with 'ISSUER NOT
COOPERATING' suffix lack a forward looking component.'
Detailed Rationale
Despite repeated attempts to engage with the management, CRISIL
Ratings failed to receive any information on either the financial
performance or strategic intent of Dreamciti, which restricts
CRISIL Ratings' ability to take a forward looking view on the
entity's credit quality. CRISIL Ratings believes that rating action
on Dreamciti is consistent with 'Assessing Information Adequacy
Risk'. Based on the last available information, the ratings on bank
facilities of Dreamciti continues to be 'CRISIL B+/Stable Issuer
Not Cooperating'.
Dreamciti is currently executing a residential villas project,
Dreamciti Greens, of 107,350 square feet (sq ft) at Bannerghatta
Road, Bengaluru. Dreamciti was incorporated in in 2010 by Mr. Vijay
Singh.
EVERGREEN ENVIRO: Insolvency Resolution Process Case Summary
------------------------------------------------------------
Debtor: Evergren Enviro Private Limited
Plot No. 247 & 252
Gram Panchayat Narayanpur
Vill–Bibirait, PS-Bhangore
South Parganas, Kolkata 743502
West Bengal, India
Insolvency Commencement Date: January 7, 2022
Court: National Company Law Tribunal, Kolkata Bench
Estimated date of closure of
insolvency resolution process: July 5, 2022
Insolvency professional: Vasudeo Agarwal
Interim Resolution
Professional: Vasudeo Agarwal
5 Fancy Lane
3rd Floor, Room No. 9
Kolkata, West Bengal 700001
E-mail: vdainfo@gmail.com
Last date for
submission of claims: January 22, 2022
FINE WOOD: CARE Lowers Rating on INR8.40cr LT Loan to D
-------------------------------------------------------
CARE Ratings revised the ratings on certain bank facilities of Fine
Wood Products Private Limited (FWPPL), as:
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long Term Bank 8.40 CARE D; ISSUER NOT COOPERATING
Facilities 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 February 8, 2021, placed the
rating(s) of FWPPL under the 'issuer non-cooperating' category as
FWPPL 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. FWPPL continues to
be noncooperative despite repeated requests for submission of
information through e-mails, phone calls and a letter/email dated
December 25, 2021, January 4, 2022, January 13, 2022.
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).
The ratings assigned to the bank facilities of NCSPL have been
revised on account of on-going delays in debt servicing recognized
from publicly available information i.e. Annual reports of FY20 and
FY21.
Nirvin Cold Storage Pvt. Ltd. (NCSPL), incorporated in the year
1984, is a Kolkata (West Bengal) based company, promoted by Shri
Niraj Kumar Bansal and Smt. Jyoti Bansal (wife of Shri Niraj Kumar
Bansal). It is engaged in the business of providing cold storage
services to potato growing farmers and potato traders, having an
installed storage capacity of 19,465 MTPA in Bankura district of
West Bengal. Shri Niraj Kumar Bansal looks after the day to day
activities of the business with adequate support from co-director
and a team of experienced professionals.
GANGA FOUNDATIONS: Insolvency Resolution Process Case Summary
-------------------------------------------------------------
Debtor: Ganga Foundations Private Limited
No. 33, Paper Mills Road
Hemavathy Complex, II Floor
Perambur, Chennai 600011
Insolvency Commencement Date: January 10, 2022
Court: National Company Law Tribunal, Chennai Bench
Estimated date of closure of
insolvency resolution process: July 9, 2022
Insolvency professional: Kavitha Surana
Interim Resolution
Professional: Kavitha Surana
S.U.S. Bhawan
No. 2, Vimala Street
Ayyavoo Colony
Aminjikarai, Chennai 600029
E-mail: kavitha@mksurana.com
Classes of creditors: Home Buyers
Insolvency
Professionals
Representative of
Creditors in a class: Ms. R Ramela
E-mail: rum_jai@yahoo.com
Ms. Chitra Srinivas
E-mail: schitral18@gmail.com
Ms. Jayashree S Iyer
E-mail: jayashree2505@gmail.com
Last date for
submission of claims: January 28, 2022
GAV AGRO: ICRA Keeps D Debt Ratings in Not Cooperating Category
---------------------------------------------------------------
ICRA has retained the ratings for the bank facilities of Gav Agro
Private Limited in the 'Issuer Not Cooperating' category. The
rating is denoted as [ICRA]D; ISSUER NOT COOPERATING.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long Term– 4.00 [ICRA]D; ISSUER NOT
COOPERATING;
Fund Based/ Rating continues to remain under
Cash Credit 'Issuer Not Cooperating'
Category
Long Term– 10.15 [ICRA]D; ISSUER NOT
COOPERATING;
Fund Based/ Rating continues to remain under
Term Loan 'Issuer Not Cooperating'
Category
ICRA has been trying to seek information from the entity so as to
monitor its performance, but despite repeated requests by ICRA, the
entity's management has remained non-cooperative. The current
rating action has been taken by ICRA basis best
available/dated/limited information on the issuers' performance.
Accordingly, the lenders, investors and other market participants
are advised to exercise appropriate caution while using this rating
as the rating may not adequately reflect the credit risk profile of
the entity. The rating action has been taken in accordance with
ICRA's policy in respect of non-cooperation by a rated entity
available at www.icra.in.
Established in June 2013, GAPL commenced commercial milling in
February 2016. The manufacturing unit of the company is located at
Lucknow-Sultanpur road with a capacity of milling 8 tons of paddy
per day (TPH). The active promoters in GAPL are
Mr. Pradeep Kumar, Mr. Ajai Kumar Gupta and Mr. Om Prakash who have
vast experience in rice milling business.
INDIAN STEEL: ArcelorMittal India's Affiliate Leads Bidding Race
----------------------------------------------------------------
A M Mining Pvt Ltd, an affiliate of ArcelorMittal India, is the
front runner for Indian Steel Corporation that was admitted for
debt resolution by the bankruptcy court people aware of the matter
told The Economic Times of India.
Naveen Jindal-promoted Jindal Steel & Power is another bidder
seeking to buy the steel company, people said.
Lenders to the steelmaker are hoping to receive at least about 40%
of their dues, one of the persons told ET.
According to ET, the resolution professional, Ajay Joshi, received
four expressions of interest. Other bidders include Jindal Steel &
Power, Metro Global Pvt Ltd and Khandwala Finstock, the sources
said.
In the last two years, ArcelorMittal India has acquired two steel
companies -- Essar Steel in December 2019 and Uttam Galva Steel in
June 2021 -- both under the bankruptcy route, ET notes.
ArcelorMittal partnered with Nippon Steel to acquire Essar Steel
for INR42,000 crore, which amounted to a 77% recovery for lenders.
AM Mining offered INR4,000 crore for Uttam Galva Steel, equating to
a 43% recovery.
In a letter to employees last December, ArcelorMittal Nippon
Steel's group chief executive Aditya Mittal stated that the company
wants to be at the "forefront of supporting the rapid and sustained
rise in steel consumption in India". Aditya Mittal is the son of
ArcelorMittal founder Lakshmi Mittal.
About Indian Steel
Incorporated in 2002, Indian Steel Corporation Limited (ISCL), is
involved in manufacturing cold rolled (CR) coils and sheets along
with galvanised plain (GP), galvanized corrugated (GC) sheets and
colour-coated galvanised sheets. The company's manufacturing
facilities are located at Bhimasar village near Kandla port,
Gandhidham (Gujarat), in proximity to the Mundra port.
ISCL was jointly promoted by the Ruchi Group of Industries, India,
and Mitsui & Co. Ltd., Japan, in 2002. It commenced operations from
2004. Mitsui acquired a 20% stake in the company but sold it in
FY2021.
In FY2021, on a provisional basis, the company reported a net loss
of INR195 crore on an OI of INR776 crore, compared with a net loss
of INR67 crore on an OI of INR902 crore in the previous year.
India Resurgence Asset Reconstruction Company, which is backed by
Bain Capital and Piramal Enterprises, initiated debt resolution
proceedings against the company in October 2021. Ajay Joshi serves
as the resolution professional.
Indian Steel's verified financial creditors' claim stood at
INR2,704 crore, according to The Economic Times of India, citing
disclosure made by the RP. Nearly 70% of the company's verified
debt has been acquired by India Resurgence ARC from various
lenders. Punjab National Bank holds about 20% of the debt. State
Bank of India, the largest lender exited by selling its INR929
crore debt to India Resurgence ARC for INR360 crore in 2019, a
recovery of 40%, according to ET.
Attempts to recast the company's debt did not progress and by 2018
it defaulted to lenders, the people told ET. Competition from
global players, cyclical downturns and stretched liquidity profile
affected the company's performance, according to a rating report by
Icra Ltd.
K. SENTHIL: CRISIL Moves B+ Debt Rating to Not Cooperating
----------------------------------------------------------
CRISIL Ratings has migrated the rating on bank facilities of K.
Senthil Kumar HUF (KSKH) to 'CRISIL B+/Stable Issuer not
cooperating'.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Cash Credit 5 CRISIL B+/Stable (ISSUER NOT
COOPERATING; Rating Migrated)
Term Loan 4 CRISIL B+/Stable (ISSUER NOT
COOPERATING; Rating Migrated)
CRISIL Ratings has been consistently following up with KSKH for
obtaining information through letters and emails dated October 29,
2021 and November 24, 2021 among others, apart from telephonic
communication. However, the issuer has remained non cooperative.
'The investors, lenders and all other market participants should
exercise due caution with reference to the rating assigned/reviewed
with the suffix 'ISSUER NOT COOPERATING' as the rating is arrived
at without any management interaction and is based on best
available or limited or dated information on the company. Such non
co-operation by a rated entity may be a result of deterioration in
its credit risk profile. These ratings with 'ISSUER NOT
COOPERATING' suffix lack a forward looking component.'
Detailed Rationale
Despite repeated attempts to engage with the management, CRISIL
Ratings failed to receive any information on either the financial
performance or strategic intent of KSKH, which restricts CRISIL
Ratings' ability to take a forward looking view on the entity's
credit quality. CRISIL Ratings believes that rating action on KSKH
is consistent with 'Assessing Information Adequacy Risk'.
Therefore, on account of inadequate information and lack of
management cooperation, CRISIL Ratings has migrated the rating on
bank facilities of KSKH to 'CRISIL B+/Stable Issuer not
cooperating'.
Set up in 1996, Namakkal, Tamil Nadu-based KSKH, a HUF firm,
promoted by Mr. K Senthil Kumar, is engaged in rearing layering
chicks for egg production.
MEMBRANE FILTERS: CARE Lowers Rating on INR19.79cr Loan to C
------------------------------------------------------------
CARE Ratings said the rating for the bank facilities of Membrane
Filters (India) Private Limited (MFPL) continues to remain in the
'Issuer Not Cooperating ' category.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long Term Bank 19.79 CARE C; ISSUER NOT COOPERATING
Facilities Rating continues to remain
Under ISSUER NOT COOPERATING
category and Revised from
CARE B-
Short Term Bank 10.00 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 January 22, 2021, placed the
rating(s) of MFPL under the 'issuer non-cooperating' category as
MFPL 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. MFPL continues to be
noncooperative despite repeated requests for submission of
information through e-mails, phone calls and a letter/email dated
December 08, 2021, December 18, 2021, December 28, 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 MFPL have been revised on account of
non-availability of requisite information.
MFIPL promoted by Mr Subhash Devi, started commercial production in
2003. MFIPL is engaged in the manufacturing of Water Filtration
Systems by employing the Ultra Filtration (UF) Membrane technology
developed by Pune-based Council of Scientific and Industrial
Research, National Chemical Laboratory (CSIR-NCL). This UF membrane
technology was acquired by MFIPL in 2005. The company's majority of
the shareholding, ie, 48.93% is held by a venture capital company,
viz, Innovative Ventures Limited (IVL). The manufacturing facility
of the company is located at Bhor, Maharashtra, with a total
installed capacity of 3,000 units.
MITTAL GLOBAL: CRISIL Lowers Rating on INR9cr Loans to B
--------------------------------------------------------
CRISIL Ratings has revised the ratings on bank facilities of Mittal
Global Cot. Industries (MGCI) to 'CRISIL B/Stable Issuer Not
Cooperating' from 'CRISIL BB/Stable Issuer Not Cooperating'.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Cash Credit 7.7 CRISIL B/Stable (ISSUER NOT
COOPERATING; Revised from
'CRISIL BB/Stable ISSUER NOT
COOPERATING')
Cash Credit 1.3 CRISIL B/Stable (ISSUER NOT
COOPERATING; Revised from
'CRISIL BB/Stable ISSUER NOT
COOPERATING')
CRISIL Ratings has been consistently following up with MGCI for
obtaining information through letters and emails dated October 16,
2021 and December 4, 2021 among others, apart from telephonic
communication. However, the issuer has remained non cooperative.
'The investors, lenders and all other market participants should
exercise due caution with reference to the rating assigned/reviewed
with the suffix 'ISSUER NOT COOPERATING' as the rating is arrived
at without any management interaction and is based on best
available or limited or dated information on the company. Such non
co-operation by a rated entity may be a result of deterioration in
its credit risk profile. These ratings with 'ISSUER NOT
COOPERATING' suffix lack a forward looking component.'
Detailed Rationale
Despite repeated attempts to engage with the management, CRISIL
Ratings failed to receive any information on either the financial
performance or strategic intent of MGCI, which restricts CRISIL
Ratings' ability to take a forward looking view on the entity's
credit quality. CRISIL Ratings believes that rating action on MGCI
is consistent with 'Assessing Information Adequacy Risk'. Based on
the last available information, the ratings on bank facilities of
MGCI Revised to 'CRISIL B/Stable Issuer Not Cooperating' from
'CRISIL BB/Stable Issuer Not Cooperating'.
MGCI was set up as a partnership firm in July 2012 by Mr. Kamal
Agrawal and his family members. The firm gins and presses cotton at
its unit in Barwani, Madhya Pradesh. It commenced operations in
December 2012. The Agrawal family has been in the cotton ginning
business since 1996.
NILGIRI DAIRY: CARE Reaffirms B Rating on INR10.20cr LT Loan
------------------------------------------------------------
CARE Ratings reaffirmed ratings on certain bank facilities of The
Nilgiri Dairy Farm Private Limited (NDF), as:
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long Term Bank
Facilities 10.20 CARE B; Stable Reaffirmed
Detailed Rationale & Key Rating Drivers
The rating assigned to the bank facilities of The Nilgiri Dairy
Farm Private Limited (NDF) continues to be constrained on account
of weakening of credit profile of Future group including NDF's
parent, Future Consumer Limited. The rating is also constrained by
small scale of operations which was further affected during FY21 on
account of supply chain disruption among COVID 19 pandemic and
discontinuance of loss-making milk trading business. NDF continues
to report losses at operating level translating into weak capital
structure with an eroded net worth. The company has however, repaid
its long term debt as on September 30, 2021 and currently does not
have any long term debt obligations. These rating weaknesses are
partially offset by the long track record of its operations and its
established brand name.
Rating Sensitivities
Positive Factors - Factors that could lead to positive rating
action/upgrade:
* Improvement in the credit profile of the parent
* Recovery in sales to pre COVID levels and positive PBIDLT
Negative Factors- Factors that could lead to negative rating
action/downgrade:
* Continuing losses which needs to be funded by debt
Detailed description of the key rating drivers
Key Rating Weaknesses
* Small Scale of operations: The company sells its products to the
various franchisee stores and also earns royalty income. Majority
of the company's franchisee stores are concentrated in Southern
India with sales occurring primarily in Tamil Nadu and Karnataka.
During FY21, due to supply chain disruptions on account of COVID 19
pandemic, closure of non-performing stores as well as
discontinuation of milk trading business, the total operating
income of the company deteriorated by 63% to INR65.51 crore as
against INR179.02 crore in FY20. Further, during H1FY22, the
company reported total operating income of INR34.81 crore as
against 35.27 crore achieved during H1FY21.
* Continuing losses and weak capital structure: During FY21, the
company reported PBILDT loss of INR12.74 crore and cash loss of
INR27.81 crore as against PBILDT loss of INR6.61 crore and cash
loss of INR31.63 crore in FY20. Due to losses incurred by the
company in past, its net worth has been eroded and stood at
negative INR40.23 crore as on March 31, 2021 as against negative
INR7.86 cr as on March 31,2020. However, the company does not have
any long term borrowings as on November 30, 2021. The cash losses
were funded by ICDs from Future Consumer Limited (FCL). As on March
31, 2021, ICD of INR64.41 cr were outstanding as against INR72.42
crore as on March 31,2021. During FY21, NDF has repaid approx.
INR8.00 cr from the inflows received on account of MoU signed for
sale of its assets to develop a commercial property under a Joint
Venture (JV).
Key Rating Strengths
* Long track record of operations and business linkages with Future
Group: The Company is operational for around three decades and has
an established brand name especially in Southern India. NDF is a
fully owned subsidiary of Future Group, which is among the largest
retailers in India. In FY15, Future Consumer Limited (FCL) acquired
the company. During FY21, around 17% of the total sales of NDF were
to Future group and in turn more than 45% of the purchases of NDF
were from the group.
Liquidity: Stretched
The company reported cash losses over the years and the same were
funded by ICD from parent group. The company continues to report
losses and had not received any ICD in FY21 from the parent,
however the company manages its liquidity by delaying the payments
for purchases from parent/group and from proceeds of land sale. The
average monthly utilisation of the working capital limit remains at
around 94.20% for the past 12 months ending October 2021. The
company's working capital cycle remains comfortable at 5 days in
FY21.
The Nilgiri Dairy Farm Private Limited (NDF) operates chain of
retail stores/ franchisee stores under the brand name 'Nilgiris
1905' selling and trading groceries, milk products and bakery
items. The company through its two subsidiaries viz Nilgiri's
Mechanized Bakery Pvt Ltd and Appu Nutritions Pvt Ltd, operates
bakery and bread unit. On November 20, 2014, FCL acquired the
company by purchasing 99.96% of shares from erstwhile promoters
(balance 0.04% were bought in FY16).
OMICRON POWER: CARE Keeps C Debt Rating in Not Cooperating
----------------------------------------------------------
CARE Ratings said the rating for the bank facilities of Omicron
Power Engineers Private Limited (OPEPL) continues to remain in the
'Issuer Not Cooperating ' category.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long Term Bank 30.96 CARE C; 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 OPEPL under the 'issuer non-cooperating' category as
OPEPL 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. OPEPL continues to
be noncooperative 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).
Aurangabad-based (Maharashtra) OPEPL was initially established as a
partnership firm in 1990 and later in 2010 was converted into a
private limited company. OPEPL is a turnkey power infrastructure
development company engaged in execution of power infrastructure
works like erection and commissioning of substations, transmission
line setup for government, semi-government and private
organizations.
P.M. CARIAPPA: CARE Lowers Rating on INR11.00cr LT Loan to C
------------------------------------------------------------
CARE Ratings revised the ratings on certain bank facilities of P.M.
Cariappa (PMC), as:
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long Term Bank 11.00 CARE C; Stable; ISSUER NOT
Facilities COOPERATING; Rating continues
to remain under ISSUER NOT
COOPERATING category and
Revised from CARE B-; Stable
Detailed Rationale & Key Rating Drivers
CARE had, vide its press release dated January 11, 2021, placed the
rating(s) of PMC under the 'issuer noncooperating' category as PMC
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. PMC continues to be
non-cooperative despite repeated requests for submission of
information through e-mails, phone calls and a letter/email dated
November 27, 2021, December 7, 2021 and December 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 assigned to the bank facilities of PMC have been
revised on account of non-availability of requisite information.
P.M. Cariappa (PMC), established in 1998, is Karnataka based sole
proprietorship concern engaged in the trading of Stationery,
Invitation, Greeting Cards, and paper Products all-over Dubai. The
firm procure the raw materials from domestic market based on the
order flow. The business was originally established and controlled
by Mr. P.M. Cariappa. After his demise during 2018, the business is
being managed by his brother Mr P.M. Vasanth, who has almost more
than two decade of experience in the same line of business.
PALLA SILKS: CARE Withdraws C Rating on Long Term Bank Debt
-----------------------------------------------------------
CARE has reaffirmed the ratings assigned to the bank facilities of
Palla Silks Private Limited (PSPL) at 'CARE C; Stable; Issuer not
cooperating' (Single C; Outlook: Stable; Issuer not cooperating);
based on the best available information and has simultaneously
withdrawn it, with immediate effect. The rating withdrawal is at
the request of Palla Silks Private Limited (PSPL) and 'No Objection
Certificate' received from the lender that has extended the
facilities rated by CARE.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long Term Bank - Rating continues to remain
Facilities under ISSUER NOT COOPERATING
category; Reaffirmed at CARE C;
ISSUER NOT COOPERATING and
Withdrawn
Detailed description of the key rating drivers
At the time of last rating on August 24, 2021, the following were
the key rating strengths and weaknesses (updated for FY20 annual
report available from ROC):
Key Rating Weaknesses
* Small scale of operations: The scale of operations of the company
declined from INR35.27 Cr in FY19 to INR21.66 Cr in FY20(A).
* Leveraged capital structure and modest debt coverage indicators:
The overall gearing ratio though marginally improved remained high
at 1.98x as on March 31, 2020 when compared to 2.16x as on March
31, 2019. Total debt to PBILDT and interest coverage declined and
stood at 7.57x and 1.12x respectively as on March 31, 2020 when
compared to 6.41x and 1.24x respectively as on March 31,2019. The
decline is on account of lower PBILDT amid reduction in scale of
operations.
* Highly competitive industry: Saree manufacturing & trading
industry is characterized by the presence of many individual
weavers and small unorganized players. Being one of the renowned
hubs of Andhra Pradesh for Saree trade, the Hindupur area houses
many saree manufacturers & traders of different size & scale
leading to intense competition for the company.
Key Rating Strengths
* Experienced promoters in the industry: The MD - promoter of the
company - Mr. Palla Ashok Kumar has around 13 years of experience
in the textile industry and his family has been in this business
for more than four decades.
* Improved profitability margins: The PBILDT margins has improved
and stood to 7.91% in FY20 when compared to 6.16% in FY19. On the
contra the PAT margins have declined from 3.77% in F19 to 0.43% in
FY20.
Palla Silks Private Limited (PSPL) was incorporated in the year
2014 by Mr. Palla Ashok Kumar and his wife Mrs. Palla Lakshmi. PSPL
is located at Hindupur, Andhra Pradesh and is engaged in the
business of trading of various types of silk sarees.
PALLA VAJARA: CARE Withdraws D Rating on Long Term Bank Debt
------------------------------------------------------------
CARE has reaffirmed the ratings assigned to the bank facilities of
Palla Vajara Kiran Textiles Private Limited (PVKTPL) at 'CARE D;
Issuer not cooperating' (Single D; Issuer not cooperating); based
on the best available information and has simultaneously
withdrawn it, with immediate effect.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long Term Bank - Rating continues to remain
Facilities under ISSUER NOT COOPERATING
category; Reaffirmed at CARE D;
ISSUER NOT COOPERATING and
Withdrawn
The rating withdrawal is at the request of PVKTPL and 'No Objection
Certificate' received from the lender that has extended the
facilities rated by CARE.
Detailed description of the key rating drivers
(Updated for the information available from ROC)
At the time of last rating on October 8, 2021 the following were
the key rating strengths and weaknesses:
Key Rating Weaknesses
* Ongoing Delays in Debt servicing: As per FY20 audit report there
were on-going delays in debt servicing during the period of FY20.
No updated information is available on the recent debt repayment
track record of company.
* Small scale of operations: The total operating income declined to
INR9.98 Cr in FY20(A) when compared to INR18.36 Cr in FY19. The
tangible net worth of the company stood low at 8.90 Cr as on March
31, 2020.
* Highly competitive industry: Saree manufacturing industry is
characterized by the presence of many individual weavers and
unorganized players. The Hindupur area in Andhra Pradesh houses
several saree manufacturers of different size & scale leading to
intense competition in the industry.
Key Rating Strength
* Experienced promoters: The MD - promoter of the company - Mr.
Palla Lakshmi Kumar has around two decades of experience in the
textile industry and his family has been in this business for the
past 40 years.
* Moderate capital structure and debt coverage indicators: Overall
gearing of the company stood at 0.66x as on March 31,2020 which
stood similar to FY19 levels due to increase in the net worth on
account of accretion of profits coupled with marginal increase in
the debt levels. Interest coverage (PBILDT/Interest) ratio have
deteriorated and stood at 1.98x in FY20 when compared to 3.28x in
FY19.
Palla Vajara Kiran Textiles Private Limited (PVKTPL) was
incorporated in the year 2014 by Mr. Palla Lakshmi Kumar and his
wife Mrs. Palla Saraswathi. PVKTPL is located at Hindupur, Andhra
Pradesh and is engaged in the manufacturing of silk sarees. The
company owns 200 power looms with a capacity to manufacture 94,000
sarees per annum. The raw materials which include warp, weft and
jerry are purchased locally. Mr. Palla Lakshmi Kumar, along with
his father & two brothers, has been engaged in Saree manufacturing
& trading activities through various proprietorship firms.
PREMIER AGENCIES: CARE Lowers Rating on INR7.0cr LT Loan to C
-------------------------------------------------------------
CARE Ratings revised the ratings on certain bank facilities of
Premier Agencies (PA), as:
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long Term Bank 7.00 CARE C; Stable; ISSUER NOT
Facilities COOPERATING; Rating continues
to remain under ISSUER NOT
COOPERATING category and
Revised from CARE B; Stable
CARE had, vide its press release dated January 21, 2021, placed the
rating(s) of PA under the 'issuer noncooperating' category as PA
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. PA continues to be
non-cooperative despite repeated requests for submission of
information through e-mails, phone calls and a letter/email dated
December 7, 2021, December 17, 2021, December 27, 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.
Premier Agencies (PRA), was established in April, 1979 as a
partnership firm and is currently being managed by Mr. Harish
Chander, Mr. Tarun Puniani and Mr. Bharat Puniani sharing profit
and losses in the ratio of 4:3:3. PRA is the sole authorized
distributor of Hamilton Housewares Private Limited for providing
Milton, Treo and SpotZero brand products in Haryana. The product
line consists of plasticware, thermoware, glassware, and
melamineware. The firm is having network of 1000 dealers located in
different parts of Haryana.
RAM CASHEW: CARE Lowers Rating on INR6.0cr LT Loan to C
-------------------------------------------------------
CARE Ratings revised the ratings on certain bank facilities of Sri
Ram Cashew (SRC), as:
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long Term Bank 6.00 CARE C; Stable; ISSUER NOT
Facilities COOPERATING; Rating continues
to remain under ISSUER NOT
COOPERATING category and
Revised from CARE B-; Stable
Detailed Rationale & Key Rating Drivers
CARE had, vide its press release dated January 11, 2021, placed the
rating(s) of SRC under the 'issuer noncooperating' category as SRC
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. SRC continues to be
non-cooperative despite repeated requests for submission of
information through e-mails, phone calls and a letter/email dated
November 27, 2021, December 7, 2021, and December 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 assigned to the bank facilities of SRC have been
revised on account of non-availability of requisite information.
Sri Ram Cashews (SRC) was established in the year 2010 as a
partnership firm by Ms. Divya and other three family members as
partners of the firm. SRC has its registered office located at
Udupi, Karnataka covering an area of 1.50 acres. The firm is
engaged in processing of raw cashew nuts and retailing of the same
in domestic market. The firm markets its products under "Sri Ram
Cashews" brand. The firm procures raw cashew nuts from
international market, from places such as Dubai, Tanzania Ivory
Coast and other African countries. The firm has customer base in
Delhi, Punjab, Maharashtra, Karnataka and Andhra Pradesh.
RAMCO EXTRUSION: CARE Keeps B Debt Rating in Not Cooperating
------------------------------------------------------------
CARE Ratings said the rating for the bank facilities of Ramco
Extrusion Private Limited (REPL) continues to remain in the 'Issuer
Not Cooperating ' category.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long Term Bank 30.35 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 18, 2021, placed the
rating(s) of REPL under the 'issuer non-cooperating' category as
REPL 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. REPL 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).
Ramco Extrusion Private Limited (REPL), Incorporated in February
2003 by Mr. Suresh Jain and family, engaged into manufacturing &
trading of aluminum extrusion products (includes alloying, tooling,
finishing and assembling) with installed capacity of 600 MTPA.
REPL's main products include aluminum-sections and profiles which
produce up to 200mm width for 'solid-profile' and up to 160mm 'CCD
hollow-profile'.
SB ISPAT INDIA: Insolvency Resolution Process Case Summary
----------------------------------------------------------
Debtor: S.B. Ispat (India) Private Limited
10/27, Guha Road
P.O. Ghusuri
Howrah 711107
West Bengal, India
Insolvency Commencement Date: January 7, 2022
Court: National Company Law Tribunal, Kolkata Bench
Estimated date of closure of
insolvency resolution process: July 6, 2022
(180 days from commencement)
Insolvency professional: Nitin Daga
Interim Resolution
Professional: Nitin Daga
Avani Oxford-II
Block-1, Flat-1B
136 Jessore Road
Kolkata 700055
E-mail: daga.nitin.cs@gmail.com
- and -
125-A Metropolitan Co-operative
Housing Society, 3rd Floor
Kolkata 700105
E-mail: cirp.sbispat@gmail.com
Last date for
submission of claims: January 21, 2022
SENCO GOLD: CRISIL Keeps FB+ Deposit Rating in Not Cooperating
--------------------------------------------------------------
CRISIL Ratings said the rating on bank facilities of Senco Gold
Limited (SGL) continues to be 'FB+/Stable Issuer Not Cooperating'.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Fixed Deposits 99.0 FB+/Stable (Issuer Not
Cooperating)
CRISIL Ratings has been consistently following up with SGL for
obtaining information through letters and emails dated October 16,
2021 and December 28, 2021 among others, apart from telephonic
communication. However, the issuer has remained non cooperative.
'The investors, lenders and all other market participants should
exercise due caution with reference to the rating assigned/reviewed
with the suffix 'ISSUER NOT COOPERATING' as the rating is arrived
at without any management interaction and is based on best
available or limited or dated information on the company. Such non
co-operation by a rated entity may be a result of deterioration in
its credit risk profile. These ratings with 'ISSUER NOT
COOPERATING' suffix lack a forward-looking component.'
Detailed Rationale
Despite repeated attempts to engage with the management, CRISIL
Ratings failed to receive any information on either the financial
performance or strategic intent of SGL, which restricts CRISIL
Ratings' ability to take a forward-looking view on the entity's
credit quality. CRISIL Ratings believes that rating action on SGL
is consistent with 'Assessing Information Adequacy Risk'. Based on
the last available information, the ratings on bank facilities of
SGL continue to be 'FB+/Stable Issuer Not Cooperating'.
SGL was incorporated in August 1994, as a private limited company,
and reconstituted as a public limited company, with the current
name in August 2007. Promoted by Mr. Shankar Sen, Mrs Ranjana Sen,
and Mr. Suvankar Sen, it manufactures and retails plain and studded
gold jewelry, along with diamond, platinum, and silver jewelry. It
also exports to wholesalers in Saudi Arabia, Dubai, and Singapore.
SLIPCON ENGINEERING: Insolvency Resolution Process Case Summary
---------------------------------------------------------------
Debtor: Slipcon Engineering Private Limited
New Bina, Khaparkheda Tahsil: Saoner
District: Nagpur, Khaparkheda 441102
Insolvency Commencement Date: December 7, 2021
Court: National Company Law Tribunal, Mumbai Bench
Estimated date of closure of
insolvency resolution process: June 5, 2022
(180 days from commencement)
Insolvency professional: Mr. Tushar Ashar
Interim Resolution
Professional: Mr. Tushar Ashar
E 620, Raj Arcade
Mahavir Nagar
Kandivali (W)
Mumbai 400067
Mobile: +91932390678
E-mail: tushar.ashar@icai.org
- and -
201-206, Shiv Smriti, 2nd Floor
49A, Dr. Annie Besant Road
Above Corporation Bank
Worli, Mumbai 400018
E-mail: irp.slipcon.engineering@gmail.com
Last date for
submission of claims: January 19, 2022
SUBAM TEXTILES: CARE Lowers Rating on INR13.22cr LT Loan to B+
--------------------------------------------------------------
CARE Ratings revised the ratings on certain bank facilities of Sri
Subam Textiles (SST), as:
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long Term Bank 13.22 CARE B+; Stable; ISSUER NOT
Facilities COOPERATING; Rating continues
to remain under ISSUER NOT
COOPERATING category and
Revised from CARE BB-; Stable
Detailed Rationale & Key Rating Drivers
CARE Ratings Ltd has been seeking information from SST to monitor
the ratings vide e-mail communications dated August 4, 2021,
September 30, 2021, October 26, 2021, among others and numerous
phone calls. However, despite our repeated requests, the firm has
not provided the requisite information for monitoring the ratings.
In line with the extant SEBI guidelines, CARE has reviewed the
ratings on the basis of the best available information which
however, in CARE's opinion is not sufficient to arrive at a fair
rating. The rating on Sri Subam Textiles bank facilities will now
be denoted as CARE B+; Stable; ISSUER NOT COOPERATING.
Users of this rating (including investors, lenders and the public
at large) are hence requested to exercise caution while using the
above rating.
The revision in rating takes into account the non-availability of
requisite information due to non-cooperation by Sri Subam
Textiles with CARE's efforts to undertake a review of the
outstanding ratings as CARE views information availability risk as
key factor in its assessment of credit risk profile.
Detailed description of the key rating drivers
At the time of last rating on December 21, 2020 the following were
the rating strengths and weaknesses:
Key Rating Weaknesses
* Leveraged capital structure: The capital structure of the firm
remained leveraged during the review period. The overall gearing of
the firm deteriorated from 2.98x as on March 31, 2018 to 3.25x as
on March 31, 2019 due to fresh long-term loans availed by the firm
for the purpose of purchase of machineries and value additions, so
as to enhance its production capacity. In addition to that it has
also availed business loans/working capital term loans to meet out
its day to day business needs, primarily for purchase of cotton.
However, the facility has remained closed during FY19. Further in
FY20 (Prov.) the firm has purchased a windmill for its captive
consumption with the total project cost of INR14.00 Crore which is
to be funded through the term loan of INR9.20 Crore from bank and
rest from internal accruals. This along with increased utilization
level of working capital bank borrowings as on balance sheet date
FY20 (Prov.), the overall gearing continued to be in par with
previous fiscal at 3.23x as of March 31, 2020.
* Susceptibility of profits at volatile price fluctuation and
seasonality associated with availability of cotton: The cotton
industry is highly fragmented in nature with several organized and
unorganized players. Prices of raw cotton are highly volatile in
nature and depend upon the factors like area under cultivation,
crop yield, and demand-supply scenario. The cotton processing
operators procure raw materials in bulk quantities to avail
discount from suppliers to mitigate the seasonality associated with
availability of cotton resulting in higher inventory holding
period. Further, the profitability margins of the firm are
susceptible due to fluctuation in raw material prices.
* Highly fragmented industry with intense competition from large
number of players: The firm is engaged in manufacturing of cotton
yarn which is highly fragmented industry due to presence of large
number of organized and unorganized players in the industry
resulting in huge competition.
* Constitution of the entity as proprietorship concern with
inherent risk of withdrawal of capital: SST, being a proprietorship
concern, is exposed to inherent risk of the promoter's capital
being withdrawn at time of personal contingency and firm being
dissolved upon the death/retirement/insolvency of the proprietor.
Moreover, proprietorship business has restricted avenues to raise
capital which could prove a hindrance to its growth. The proprietor
has withdrawn an amount of INR0.29 cr. during FY20.
Key Rating Strengths
* Experience of the promoter for more than three-decade in the
textile industry: SST was incorporated in the year 1991 and is
managed by Mr. B. P. S Eshawaran, who is a graduate by
qualification and has more than three decades of experience in
textile business. Due to long term presence and experience of the
proprietor in textile industry, he has established relationship
with suppliers and customers.
* Growth in total Operating Income: The firm has improved its
scale of operations at a CAGR of 12.09% over FY18-FY20 period.
Total operating income (TOI) of the firm improved by 31.54% in FY19
to INR84.66 Crore as against 64.36 Crore in FY18 aided by increase
in sale of yarn as well as from cloth vertical. Further, in FY20
(prov.), the TOI has surged to INR90.65 crore primarily driven by
increase in sale of cloth on the back of increase in order inflows
both from existing and new clientele.
* Healthy profitability margins: The profitability margins of the
firm were seen improving during the review period. The PBILDT
margin of the firm declined marginally from 6.85% in FY18 to 6.28%
in FY19 due to increase in material costs. However, the same has
improved by 900 bps to 15.28% in FY20 Prov. due to increase in
total operating income on absolute basis coupled with reduced
material costs. The PAT margin of the firm remained almost in flat
with previous fiscals, and stood at 1.27% in FY20 Prov. (1.10% and
1.15% in FY18 and FY19 respectively).
* Satisfactory debt protection metrics: The Debt coverage
indicators of the firm improved and stood satisfactory during
review period. Total debt/GCA of the firm improved from 6.45x in
FY18 to 5.47x in FY19 due to increase in cash accruals to the firm
albeit increase in total debt levels. It further continues to
improve and stood at 1.96x in FY20 Prov. due to sufficient cash
accruals generated during the year. The PBILDT Interest coverage
ratio of the firm improved from 3.42x as on FY18 to 3.82x in FY19
due to increase absolute terms of PBILDT. It further improved to
6.89x in FY20 Prov. due to continued increase in absolute PBILDT.
* Satisfactory operating cycle days: The operating cycle of the
firm remained comfortable at 8 days in FY20 (19 days in FY19) due
to satisfactory collection and creditors period. The firm usually
makes the payments to its suppliers within 10-30 days. Also, the
firm receives the payment from its customers within 30-60 days. The
firm maintains the stock of raw cotton for a period of 30 days to
meet out the orders on time. The average collection and creditor's
period has elongated to 52 days and 64 days respectively in FY20
(Prov.). Though the collection days of firm has elongated to 52
days, it has stretched its creditor's period up to 64 days availed
credit period for payment of the materials purchased. Hence the
reliance on working capital bank borrowings are relatively moderate
and the average utilization for the last 12 months ended November
30, 2020 stood at 75%.
Liquidity analysis: Adequate
Adequate liquidity characterized by sufficient cushion in accruals
vis-à-vis repayment obligations and cash balance of INR0.87 crore
as of March 31, 2020(Prov.). Adding, the firm has liquidity cushion
with nearly 25% (i.e. INR1.88 Crore) of working capital limits
unutilized as on November 30, 2020. Further, the current ratio
stood moderate at 1.01x as on March 31, 2020 (Prov.) to meet out
its short-term debt obligations. The firm has availed moratorium on
its Term loan facilities from March to August 2020 as per COVID-19
RBI guidelines.
Tamilnadu-based, Sri Subham Textiles (SST) is a proprietorship
entity, established and commenced commercial operations in the year
1991. The firm is managed by P S Eshwaran. SST is engaged in
manufacturing of cotton yarn and Fabrics. The firm has its
registered office located at Tirupur and had its manufacturing
facilities in Erode District with an installed capacity of 1.85
crore meters of cloth per annum and 24 Lakh kgs of yarn per annum
(as of March 31, 2020). The firm purchases raw material from
Karnataka, Maharashtra, Telangana and Andhra Pradesh.
VINIL TRADING: CRISIL Keeps B Debt Rating in Not Cooperating
------------------------------------------------------------
CRISIL Ratings said the rating on bank facilities of Vinil Trading
Private Limited (VTPL) continues to be 'CRISIL B/Stable Issuer Not
Cooperating'.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Term Loan 18 CRISIL B/Stable (Issuer Not
Cooperating)
CRISIL Ratings has been consistently following up with VTPL for
obtaining information through letters and emails dated October 16,
2021 and December 04, 2021 among others, apart from telephonic
communication. However, the issuer has remained non cooperative.
'The investors, lenders and all other market participants should
exercise due caution with reference to the rating assigned/reviewed
with the suffix 'ISSUER NOT COOPERATING' as the rating is arrived
at without any management interaction and is based on best
available or limited or dated information on the company. Such non
co-operation by a rated entity may be a result of deterioration in
its credit risk profile. These ratings with 'ISSUER NOT
COOPERATING' suffix lack a forward-looking component.'
Detailed Rationale
Despite repeated attempts to engage with the management, CRISIL
Ratings failed to receive any information on either the financial
performance or strategic intent of VTPL, which restricts CRISIL
Ratings' ability to take a forward-looking view on the entity's
credit quality. CRISIL Ratings believes that rating action on VTPL
is consistent with 'Assessing Information Adequacy Risk'. Based on
the last available information, the ratings on bank facilities of
VTPL continue to be 'CRISIL B/Stable Issuer Not Cooperating'.
Incorporated in August 2011, VTPL is a fully owned subsidiary of
Keynote Enterprises Pvt Ltd, which is promoted by Mr. Rashesh
Purohit and his wife, Ms Sonal Purohit. It leases old content for
television (TV), primarily TV series, movies, and music from
content owners, and sells it to other broadcasters and content
aggregators. It also trades in content.
VIVANTA LABORATORIES: Insolvency Resolution Process to End by May
-----------------------------------------------------------------
According to an updated post on the website of Insolvency and
Bankruptcy Board of India, the last date for submission of claims
in the insolvency case of Vivanta Laboratories Private Limited was
December 16, 2021. The estimated date of closure of insolvency
resolution process is May 31, 2022.
The insolvency case of Vivanta Laboratories Private Limited was
commenced on December 2, 2021 at the National Company Law Tribunal,
Hyderabad Bench. The company's insolvency professional is Pavan
Kankani.
WORLD WIND: CARE Reaffirms B Rating on INR160.99cr LT Loan
----------------------------------------------------------
CARE Ratings reaffirmed ratings on certain bank facilities of World
Wind Farms (Hindustan) Private Limited (WFHPL), as:
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long Term Bank
Facilities 160.99 CARE B; Stable Reaffirmed
Detailed Rationale & Key Rating Drivers
The reaffirmation of long-term rating of bank facilities of WFHPL
continues to be constrained by high counter party risk, weak
financial risk profile and dependence on seasonal wind pattern.
However, the rating continues to derive strength from firm off-take
arrangement of entire operational capacity which mitigates demand
risk and satisfactory operational performance of wind farms in FY21
and H1FY22.
Rating Sensitivities
Positive Factors - Factors that could lead to positive rating
action/upgrade:
* Decrease in receivable days below 30 days on sustained manner and
increase in plant load factor above 15% on sustained basis.
Negative Factors- Factors that could lead to negative rating
action/downgrade:
* Delay in collection of receivables from counter party more than
120 days.
Detailed description of the key rating drivers
Key Rating Weaknesses
* High counter party risk resulting in weak financial risk profile
of the company: WFHPL continues to expose to high counter party
risk as entire installed capacity is sold to state Discoms having
relatively weak financial risk profile. The company is witnessing
delay in realization of receivables from Rajasthan Discoms leading
to weakening of financial risk profile of the company. As a result,
Debt Service Reserve Account (DSRA) is often utilized towards
repayment of debt obligations and company replenishes DSRA account
as and when it receives payments from Discoms. During FY21 and
H1FY22, the company has faced challenges for realization of invoice
raised to Bangalore Electricity Supply Company Limited (BESCL). The
company was asked to submit impact assessment study to the Forest
department of Karnataka State government.
Further, the state government had directed BESCL on not to release
any payment to WFHPL till the assessment is completed and approved
by the authorities. Due to COVID-19 pandemic, the company has
submitted its assessment in September 2021 while issue was resolved
from the state government in October 2021. Owing the same, BESCL
has released INR48.27 crore for period June 2020 to September 2021.
As per the management, the company expects normal collection period
from BESCL from now onwards. The company has PPA with Jaipur
Vidyut Vitran Nigam Limited and Ajmer Vidyut Vitran Nigam Limited
for the power generated from Rajasthan wind power plant. Payments
from both the DISCOMs are received with delay of around 3-4 months
after the due date.
* Dependence on seasonal wind patterns: Wind farms are exposed to
inherent risk of weather fluctuations leading to variations in the
wind patterns and velocity which affects the Plant Load Factor
(PLF). Generally, the wind farms enjoy higher PLF during May –
October (monsoon period) and lower PLFs in the remaining months of
the year. TN as a state has witnessed unprecedented cyclones and
floods in nearby state over past two years which shortened the wind
season in the last 2 years thereby affecting the PLF and the power
generation levels across all wind firms over the last 2 years.
Key Rating Strengths
* Experienced Promoters in wind power generation projects: Wind
World Wind Farms Hindustan Private Limited (WFHPL) is a Wind World
India Limited (WWIL) group company. As on March 31, 2021, WWIL
holds 51% shares in WWFHL and balance shares are held by Enercon
GmbH (ultimate holding company). Mr. Yogesh Mehra and Mr. Ajay
Mehra are also the founders of WWIL (formerly known as Enercon
India Limited), one of the largest players in the wind power
industry. WWIL has expertise in wind power, has 5 plants in Daman
for manufacturing of blades and wind turbine generator with
manufacturing capacity of 1000 WECs equivalent to 800 MW p.a. and
three concrete tower manufacturing plants in Gujarat, Karnataka and
Tamil Nadu, having annual installed capacity of 1200 towers p.a.
Enercon GmbH is one of the leading manufacturers for WECs
globally.
WWIL's wind farms today straddle seven high wind potential states
Karnataka, Maharashtra, Tamil Nadu, Rajasthan, Gujarat, Madhya
Pradesh and Andhra Pradesh, spread across 3,000 kms of India. WWIL
is currently undergoing insolvency resolution process.
* Firm off-take arrangement for entire operational capacity through
long term PPAs: WFHPL has long term Power Purchase Agreements for
entire operational capacity for period of 20 years (i.e. till
FY2026) with DISCOMs in state of Karnataka and Rajasthan. In
Karnataka, PPA is with Bangalore Electricity Supply Company Limited
[BESCL, rated ICRA A-(Is); Negative as of April 23, 2021] at tariff
of INR3.40 per unit for installed capacity of 68.80 MW located at
Tumkur district. In Rajasthan, PPA is with Jaipur Vidyut Vitran
Nigam Limited [JVVN] at tariff of INR3.79 per unit for 28.80 MW and
Ajmer Vidyut Vitran Nigam Limited [AVVN] at tariff of INR3.79 per
unit for 31.20 MW installed capacity located at Jaisalmer District.
As per the terms of the PPA, the payments are made on monthly
basis.
* Improvement in operational performance during H1FY22: On the
operational front all wind farms i.e. 68.8 MW plant consisting of
86 WEC at Karnataka and 60 MW power plant consisting of 75 WEC at
Rajasthan have a reasonable operational track record of more than
10 years. Grid Availability of the plants has been above 95% for
both the plants indicating the reliability of the wind turbine
which means the times the machines and the grids were available for
most part of the year to generate electricity. The annualized unit
generation (units) for FY21 is 87.49 million units with average PLF
of 14.72% from 86 WEC in Karnataka and 70.54 million units with
average PLF of 13.61% from 75 WEC in Rajasthan. WFHPL has been
benefitting from favorable climate conditions and wind patterns
during FY21 and H1FY22. As a result, WFHPL's PLF stood at 22.86%
for H1FY22 as against PLF of 18.35% in H1FY21. Total unit
generation increased by ~25% on YoY basis for H1FY22 to 126.94
million units, corresponding to total billed amount of INR45.53
crore (H1FY21: INR36.55 crore).
Liquidity: Poor
The company maintains DSRA of INR27.49 crore in form of Fixed
Deposits with the lender as well as cash balance of INR9.95 crore
as on December 31, 2021. The company has repaid INR23.64 crore till
December 31, 2021 out of its scheduled repayments of Rs.32.16 crore
for FY22. The company faces challenges in realization of payment
from off-takers, leading to cash-flow mismatch and poor liquidity
position.
Wind World Wind Farms Hindustan Private Limited (WFHPL) is a Wind
World (India) Limited (WWIL) group company. As on March 31, 2021,
WWIL holds 51% shares in WWFHL and balance shares are held by
Enercon GmbH (ultimate holding company). Mr. Yogesh Mehra and Mr.
Ajay Mehra are also the founders of WWIL (formerly known as Enercon
India Limited), one of the largest players in the wind power
industry. WWIL has expertise in wind power, has 5 plants in Daman
for manufacturing of blades and wind turbine generator with
manufacturing capacity of 1000 Wind Energy Converters (WECs)
equivalent to 800 MW p.a. and three concrete tower manufacturing
plants in Gujarat, Karnataka and Tamil Nadu, having annual
installed capacity of 1200 towers p.a. WFHPL is an Independent
Power Producer (IPP) having wind farms in Karnataka and Rajasthan
with total installed capacity of 128.8 MW, consisting of 161 WECs.
WECs are manufactured, installed and maintained by WWIL. WWIL's
wind farms today straddle seven high wind potential states
Karnataka, Maharashtra, Tamil Nadu, Rajasthan, Gujarat, Madhya
Pradesh and Andhra Pradesh, spread across 3,000 kms of India. WWIL
is currently undergoing insolvency resolution process.
ZIMIDARA PESTICIDES: CARE Keeps B- Debt Rating in Not Cooperating
-----------------------------------------------------------------
CARE Ratings said the rating for the bank facilities of Zimidara
Pesticides (ZP) continues to remain in the 'Issuer Not Cooperating
' category.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long Term Bank 10.00 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 20, 2021, placed the
rating(s) of ZP under the 'issuer noncooperating' category as ZP
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. ZP 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).
Zimidara Pesticides was established in 1990 by Mr. Om Prakash, the
entity is engaged in wholesale trading of agrochemicals viz.
pesticides, seeds and fertilizers of various types of herbicides,
fungicides and insecticides etc. whereas the customers of the
entity belong to various agrochemicals players. ZP is an authorized
dealer and distributor of around 42 pesticides companies across
Punjab. It operates its registered office in Abohar, Punjab.
===============
M A L A Y S I A
===============
AIRASIA GROUP: Fundamentals Improved Despite PN17, Maybank IB Says
------------------------------------------------------------------
According to theedgemarkets.com, Maybank Investment Bank Bhd
(Maybank IB) said on Jan. 17 AirAsia Group Bhd's fundamentals have
improved despite the budget airline's Practice Note 17 (PN17)
status under Bursa Malaysia listing rules.
According to the report, Maybank IB took into account the fact
AirAsia Group's Malaysia, Thailand, Indonesia, and Philippines
operating units have been flying between 25% and 50% of their
respective operating units' aircraft at a time when the global
aviation sector continues grapple with the impact of movement
restrictions brought about by the COVID-19 pandemic.
In a note, analyst Yin Shao Yang wrote Maybank IB believes AirAsia
Group's aircraft usage update is respectable, the report says.
"More importantly, fundamentals have improved. All of our
aforementioned analyses would be for nought if AirAsia Group's
outlook does not improve.
"Yet, we believe that it has," the report quotes Yin as saying.
Yin said that currently, Maybank IB understands AirAsia Group's
Malaysia operating unit is flying about 33% of its aircraft, the
Indonesia and Philippines entities are flying around 25% to 33% of
their aircraft while Thai AirAsia is flying about 50% of its
aircraft, theedgemarkets.com relays.
Examining AirAsia Group's Malaysian operations, which historically
contributed about 80% of its earnings, he said Maybank is
encouraged by statistics reported by Malaysia Airports Holdings Bhd
(MAHB).
"Although it seems that total passenger traffic in Malaysia has not
improved very much since travel restrictions were eased on Oct 11,
2021 due to still low international traffic, domestic passenger
traffic has," he said, according to theedgemarkets.com.
"In fact, November 2021 domestic passenger traffic in Malaysia
recovered to 50% of pre-Covid-19 levels. Pre-Covid-19, AirAsia
Group commanded 2/3 of domestic passenger traffic in Malaysia and a
lower 1/3 of international passenger traffic in Malaysia.
"Although MAHB's December 2021 statistics have yet to be published,
initial indications are that domestic passenger traffic may have
eased month-on-month a tad, not so much due to the Omicron variant
of Covid-19 as the recently-passed floods.
"Thus, we maintain our view that AirAsia Group's fundamentals have
improved," he said.
About AirAsia
AirAsia Berhad provides low-cost air carrier service. The company
provides services on short-haul, point-to-point domestic and
international routes. AirAsia, headquartered in Malaysia, operates
from hubs in Malaysia, Thailand, Indonesia, Philippines and India.
The airline's Malaysia and Thailand operations are undertaken via
AirAsia Bhd and Thai AirAsia Co Ltd while AirAsia Group's Indonesia
and Philippines operations are managed under PT Indonesia AirAsia
and Philippines AirAsia Inc.
As reported in the Troubled Company Reporter-Asia Pacific on Jan.
18, 2022, AirAsia Group Bhd (AAGB) is in the midst of formulating a
plan to regularize its financial condition to address its Practice
Note 17 (PN17) status. According to The Star, Bursa Malaysia on
Jan. 13 dismissed AAGB's appeal seeking to extend an 18-month
relief period from being classified as a PN17 company that ended on
Jan. 7, 2022.
AirAsia triggered the PN17 suspended criteria in July 2020 after
its external auditors, Ernst & Young PLT, issued an unqualified
audit opinion with material uncertainty relating to going concern
in respect of its audited financial statements for the financial
year ended Dec. 31, 2019 (FY19) and its shareholders' equity on a
consolidated basis was 50% or less of its share capital.
AirAsia also triggered the prescribed criteria pursuant to
Paragraph 8.04 and Paragraph 2.1(a) of PN17 of Bursa's Main Market
Listing Requirements (Main LR), where AirAsia's shareholders'
equity on a consolidated basis was 25% or less of its share capital
and the shareholders' equity is less than MYR40 million based on
the audited financial statements for FY20.
Following relief measures introduced by Bursa and the Securities
Commission Malaysia, AirAsia was not classified as a PN17 listed
issuer and was not required to comply with the obligations under
Paragraph 8.04 and PN17 of the Main LR for a period of 18 months
from the date of the first relief announcement, theedgemarkets.com
said. The date of the first relief announcement was July 8, 2020,
and the 18-month period ended on Jan. 7, 2022. Under the relief
measures, companies that triggered any of the suspended criteria
between April 17, 2020 and June 30, 2021, would not be classified
as a PN17 and Guidance Note 3 (GN3) company for 12 months.
MALAYSIA: Bankruptcy & Insolvency Cases Drop 53.6% Over 5 Yrs
-------------------------------------------------------------
Hafiz Yatim and Timothy Achariam at theedgemarkets.com report that
Chief Justice of Malaysia Tun Tengku Maimun Tuan Mat said the
country recorded a 53.6% drop in the number of commercial cases to
55,305 in 2021 from 119,258 in 2017 as insolvency and bankruptcy
cases fell.
"This is an alarming drop of about 53.6% over a short period of
five years," Tengku Maimun said at the Opening of the Legal Year
event on Jan. 14. She said commercial cases are of significance as
an indicator of the country's economy, as such disputes represent
some measure of active business and trade.
According to the report, Tengku Maimun said amendments to
Malaysia's bankruptcy laws and enactment of the country's Companies
Act 2016, among other factors, could have reduced the number of
bankruptcy and insolvency cases in the nation respectively between
2017 and 2021.
Tengku Maimun said that between 2020 and 2021, Malaysia recorded an
approximately 17% decline in insolvency registrations,
theedgemarkets.com reports.
"I postulate that the amendments to our bankruptcy laws that
increased the threshold for bankruptcy claims along with other
amendments have naturally reduced the number of such cases filed,"
she noted.
"Specifically, the period between 2020 and 2021 recorded a 36%
decline in [bankruptcy] registrations," she said, without
specifying the quantum of the drop in the country's bankruptcy
cases between 2017 and 2021, theedgemarkets.com relates.
=====================
N E W Z E A L A N D
=====================
CREATORS@HOME LIMITED: Creditors' Proofs of Debt Due on Feb. 8
--------------------------------------------------------------
Creditors of Creators@Home Limited, which is in voluntary
liquidation, are required to file their proofs of debt by Feb. 8,
2022, to be included in the company's dividend distribution.
The company commenced wind-up proceedings on Jan. 10, 2022.
The company's liquidators are:
Steven Khov
Kieran Jones
Khov Jones Limited
PO Box 302261
North Harbour, Auckland 0751
EXPLEO FARMS: Court to Hear Wind-Up Petition on Feb. 8
------------------------------------------------------
A petition to wind up the operations of Expleo Farms Limited will
be heard before the High Court at Hamilton on Feb. 8, 2022, at
10:00 a.m.
The Commissioner of Inland Revenue filed the petition against the
company on Sept. 23, 2021.
The Petitioner's solicitor is:
C. D. Walmsley
Inland Revenue
Legal Services
21 Home Straight (PO Box 432)
SJS CLEANING: Creditors' Proofs of Debt Due on Feb. 8
-----------------------------------------------------
Creditors of SJS Cleaning Limited, which is in voluntary
liquidation, are required to file their proofs of debt by Feb. 8,
2022, to be included in the company's dividend distribution.
The company commenced wind-up proceedings on Dec. 24, 2021.
The company's liquidator is:
Benjamin Francis
Gerry Rea Partners
PO Box 3015, Auckland
VAN LIEROP: Court to Hear Wind-Up Petition Feb. 8
-------------------------------------------------
A petition to wind up the operations of Van Lierop Farming Limited
will be heard before the High Court at Hamilton on Feb. 8, 2022, at
10:00 a.m.
Reactivenz Limited trading as Supsup filed the petition against the
company on Dec. 9, 2021.
The Petitioner's solicitors are:
Brett Leeson Martelli
HC Legal Limited
Level 1, 19 Mauranui Avenue
Newmarket, Auckland
=================
S I N G A P O R E
=================
ELLEMENTO FARMING: Creditors' Proofs of Debt Due Feb. 14
--------------------------------------------------------
Creditors of Ellemento Farming Pte. Ltd., which is in voluntary
liquidation, are required to file their proofs of debt by Feb. 14,
2022, to be included in the company's dividend distribution.
The company commenced wind-up proceedings on Nov. 24, 2021.
The company's liquidators are:
Leow Quek Shiong
Gary Loh Weng Fatt
Seah Roh Lin
c/o BDO Advisory Pte. Ltd.
600 North Bridge Road
#23-01 Parkview Square
Singapore 188778
NAKE CO: Court to Hear Wind-Up Petition on Jan. 28
--------------------------------------------------
A petition to wind up the operations of Nake Co. Pte. Ltd. will be
heard before the High Court of Singapore on Jan. 28, 2022, at 10:00
a.m.
LMS Associates Pte Ltd filed the petition against the company on
Dec. 31, 2021.
The Petitioner's solicitors are:
I.N.C. Law LLC
4 Battery Road
#26-01, Bank of China Building
Singapore 049908
VDC HOLDINGS: Commences Wind-Up Proceedings
-------------------------------------------
Members of VDC Holdings Pte. Ltd., on Jan. 6, 2022, passed a
resolution to voluntarily wind up the company's operations.
The company's liquidators are:
Mr. Najeeb Assan
Ms. Zalinah Samade
M/s IP Consultants Pte. Ltd.
80 Robinson Road #15-02
Singapore 068898
=================
S R I L A N K A
=================
SRI LANKA: Fitch Corrects December 17 Ratings Release
-----------------------------------------------------
This is a correction of a release published on December 17, 2021 to
correct the ESG Relevance Score for Rule of Law, Institutional and
Regulatory Quality and Control of Corruption and the accompanying
text.
Fitch Ratings has downgraded Sri Lanka's Long-Term Foreign-Currency
Issuer Default Rating (IDR) to 'CC', from 'CCC'. Fitch typically
does not assign Outlooks or apply modifiers for sovereigns with a
rating of 'CCC' or below.
KEY RATING DRIVERS
The downgrade reflects Fitch's view of an increased probability of
a default event in coming months in light of Sri Lanka's worsening
external liquidity position, underscored by a drop in
foreign-exchange reserves set against high external debt payments
and limited financing inflows. The severity of financial stress is
illustrated by elevated government-bond yields and downward
pressure on the currency.
Fitch has affirmed the Long-Term Local-Currency IDR at 'CCC', as
authorities have continued access to domestic financing, despite
high and still-rising government debt and an elevated debt service
burden.
Sri Lanka's foreign-exchange reserves have declined much faster
than Fitch expected at its last review, owing to a combination of a
higher import bill and foreign-currency intervention by the Central
Bank of Sri Lanka. Foreign exchange reserves have declined by about
USD2 billion since August, falling to USD1.6 billion at
end-November, equivalent to less than one month of current external
payments (CXP). This represents a drop in foreign-currency reserves
of about USD 4 billion since end-2020.
Fitch believes it will be difficult for the government to meet its
external debt obligations in 2022 and 2023 in the absence of new
external financing sources. Obligations include two international
sovereign bonds of USD500 million due in January 2022 and USD1
billion due in July 2022. The government also faces
foreign-currency debt service payments, including principal and
interest, of USD6.9 billion in 2022, equivalent to nearly 430% of
official gross international reserves as of November 2021.
Cumulative foreign-currency debt service, including interest and
principal, amounts to about USD26 billion from 2022 through to
2026.
The timing and availability of external resources is unclear and
may not be readily available for debt service. The central bank
published a six-month roadmap in October that outlined plans to
raise additional external borrowings through a number of channels,
including bilateral and multilateral sources, syndicated loans and
through the monetisation of under-utilised assets in 1Q22.
A drawdown on the existing currency swap facility with the People's
Bank of China (PBOC) could boost reserves by up to CNY10 billion
(USD1.5 billion equivalent). However, even with resources from the
swap facility, foreign exchange reserves are likely to remain under
pressure, in Fitch's view. Additional sources of financing could
come from an economic support package from India, which contains a
swap facility under the South Asian Association for Regional
Cooperation currency framework of USD400 million, a swap facility
with the Qatar Central Bank, remittances securitization and a
revolving credit facility with the Bank of China Limited
(A/Stable). However, even if all these sources are secured, Fitch
believes it will be challenging for the government to maintain
sufficient external liquidity to allow for uninterrupted debt
servicing in 2022.
Press reports suggest the government may be contemplating IMF
financing; an IMF program would unlock multilateral financing, but
Fitch believes the Fund could well suggest restructuring to bring
about debt sustainability.
Sri Lanka's external finances are further challenged by a
persistent current account deficit, resulting in downward pressure
on the exchange rate. Fitch estimates that the deficit widened to
about 5.7% of GDP in 2021 and expect it to remain at about 4.0% in
2022, before falling to 2.1% by 2023. A plunge in remittances, a
weak tourism recovery and rising imports have contributed to the
wider current account deficit. Travel and tourism, an important
economic driver, has been hit hard by the COVID-19 pandemic and the
outlook for a recovery remains uncertain given the emergence of new
highly transmissible virus variants.
The Sri Lankan rupee/US dollar spot exchange rate depreciated by
7%-8% since end-2020, and the central bank intervened to support
the currency, exacerbating the decline in reserves.
Wide fiscal deficits continue to worsen the outlook for debt
sustainability. The 2021 fiscal deficit target of 8.9% of GDP was
missed by a wide margin, and Fitch expects the government deficit
to widen to about 11.5% of GDP in 2022. Fitch believes 2022 revenue
targets are optimistic, especially in light of Fitch's expectation
of weak economic activity. Fitch forecasts general government debt
to reach about 110% of GDP by 2022, and to keep rising under
Fitch's baseline, absent major fiscal consolidation.
Fitch also believes it is unlikely that Sri Lanka will meet its
2025 government debt reduction target of about 89% of GDP or narrow
the fiscal deficit to 4.8% of GDP. Rising interest payments are a
major driver of the widening deficit and the interest/revenue ratio
of at about 95.0% is well above the peer median of 11.3%.
Sri Lanka's economic performance is likely to weaken in 2022, as
the challenging external position and exchange-rate pressure will
have knock-on effects on economic activity. Foreign currency
shortages in 2021 hampered food and fuel imports, and continued
external liquidity stress could worsen supply shortages, hurting
economic activity. Fitch expects growth to slow to 2.0% in 2022,
from an estimated 3.6% in 2021, before recovering to 4.3% in 2023
partly due to base effects and a gradual easing of domestic
pressures, although downside risks to Fitch's forecasts remain. Sri
Lanka's economy was expanding at a modest pace prior to the
pandemic, which led real GDP to contract by 3.6% in 2020.
ESG - Governance: Sri Lanka has an ESG Relevance Score of '5' for
Political Stability and Rights. This reflects the high weight that
the World Bank Governance Indicators (WBGI) have in Fitch's
proprietary Sovereign Rating Model. Sri Lanka has a medium WBGI
ranking at the 47th percentile, reflecting a recent record of
peaceful political transitions and a moderate level of rights for
participation in the political process. As Sri Lanka has a
percentile rank below 50 for the governance indicator, this has a
negative impact on the credit profile.
ESG - Governance: Sri Lanka has an ESG Relevance Score of '5' for
the Rule of Law, Institutional and Regulatory Quality and Control
of Corruption. This reflects the high weight that the WBGI has in
Fitch's proprietary Sovereign Rating Model. As Sri Lanka has a
percentile rank below 50 for the respective governance indicators,
this has a negative impact on the credit profile.
Sri Lanka has an ESG Relevance Score of '5' for Creditor Rights, as
willingness to service and repay debt is relevant to the rating and
is a rating driver for Sri Lanka, as for all sovereigns. Given the
increasing possibility of default reflected in the CC rating, this
has a negative impact on the credit profile.
RATING SENSITIVITIES
Factors that could, individually or collectively, lead to negative
rating action/downgrade:
-- Failure to service bonded debt obligations within grace
periods stipulated in relevant documentation, or unilateral
declaration of a debt moratorium;
-- Launch of a formal debt renegotiation process by authorities
or the start of a process that Fitch deems to constitute a
default or default-like event.
Factors that could, individually or collectively, lead to positive
rating action/upgrade:
-- External Finances: Improved external liquidity, supported by
higher non-debt inflows or lower external sovereign
refinancing risk from an enhanced liability profile that
allows for smooth servicing of liabilities;
-- Public Finances: Implementation of a credible medium-term
fiscal consolidation strategy that supports a sustained
decline in the general government debt/GDP ratio, increasing
financing options and reducing the probability of default;
-- Structural: Improved policy coherence and credibility, leading
to more sustainable public and external finances and a
reduction in the risk of debt distress.
SOVEREIGN RATING MODEL (SRM) AND QUALITATIVE OVERLAY (QO)
In accordance with its rating criteria, Fitch's has not utilised
the SRM or QO to explain the ratings in this instance. Ratings of
'CCC+' and below are instead guided by the rating definitions.
Fitch's SRM is the agency's proprietary multiple regression rating
model that employs 18 variables based on three-year centered
averages, including one year of forecasts, to produce a score
equivalent to a Long-Term Foreign-Currency IDR. Fitch's QO is a
forward-looking qualitative framework designed to allow for
adjustment to the SRM output to assign the final rating, reflecting
factors within Fitch's criteria that are not fully quantifiable
and/or not fully reflected in the SRM.
BEST/WORST CASE RATING SCENARIO
International scale credit ratings of Sovereigns, Public Finance
and Infrastructure issuers have a best-case rating upgrade scenario
(defined as the 99th percentile of rating transitions, measured in
a positive direction) of three notches over a three-year rating
horizon; and a worst-case rating downgrade scenario (defined as the
99th percentile of rating transitions, measured in a negative
direction) of three notches over three years. The complete span of
best- and worst-case scenario credit ratings for all rating
categories ranges from 'AAA' to 'D'. Best- and worst-case scenario
credit ratings are based on historical performance.
ESG CONSIDERATIONS
Sri Lanka has an ESG Relevance Score of '5' for Political Stability
and Rights as WBGIs have the highest weight in Fitch's SRM and are
therefore highly relevant to the rating and a key rating driver
with a high weight.
Sri Lanka has an ESG Relevance Score of '5' for Rule of Law,
Institutional and Regulatory Quality and Control of Corruption as
WBGIs have the highest weight in Fitch's SRM and are therefore
highly relevant to the rating and are a key rating driver with a
high weight. As Sri Lanka has a percentile rank below 50 for the
respective Governance Indicators, this has a negative impact on the
credit profile.
Sri Lanka has an ESG Relevance Score of '4' for Human Rights and
Political Freedoms, as the Voice and Accountability pillar of the
WBGI is relevant to the rating and a rating driver. As Sri Lanka
has a percentile rank below 50 for the respective governance
indicator, this has a negative impact on the credit profile.
Sri Lanka has an ESG Relevance Score of '5' for Creditor Rights, as
willingness to service and repay debt is relevant to the rating and
is a rating driver for Sri Lanka, as for all sovereigns. Given the
increasing possibility of default reflected in the CC rating, this
has a negative impact on the credit profile. Except for the matters
discussed above, the highest level of ESG credit relevance, if
present, is a score of '3'. This means ESG issues are
credit-neutral or have only a minimal credit impact on the entity,
either due to their nature or to the way in which they are being
managed by the entity.
*********
S U B S C R I P T I O N I N F O R M A T I O N
Troubled Company Reporter-Asia Pacific is a daily newsletter co-
published by Bankruptcy Creditors' Service, Inc., Fairless Hills,
Pennsylvania, USA, and Beard Group, Inc., Washington, D.C., USA.
Marites O. Claro, Joy A. Agravante, Rousel Elaine T. Fernandez,
Julie Anne L. Toledo, Ivy B. Magdadaro and Peter A. Chapman,
Editors.
Copyright 2022. All rights reserved. ISSN: 1520-9482.
This material is copyrighted and any commercial use, resale or
publication in any form (including e-mail forwarding,
electronic re-mailing and photocopying) is strictly prohibited
without prior written permission of the publishers.
Information contained herein is obtained from sources believed
to be reliable, but is not guaranteed.
TCR-AP subscription rate is US$775 for 6 months delivered via e-
mail. Additional e-mail subscriptions for members of the same
firm for the term of the initial subscription or balance
thereof are US$25 each. For subscription information, contact
Peter Chapman at 215-945-7000.
*** End of Transmission ***