/raid1/www/Hosts/bankrupt/TCRAP_Public/220406.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, April 6, 2022, Vol. 25, No. 63
Headlines
A U S T R A L I A
ASI MANAGEMENT: First Creditors' Meeting Set for April 13
CREGGS ASPHALT: First Creditors' Meeting Set for April 13
ROTECH SYSTEMS: First Creditors' Meeting Set for April 14
SALT LAKE: Indicative Bids in May; Recapitalization an Option
TIMBERTOWN PHARMACY: First Creditors' Meeting Set for April 13
WAUCHOPE PHARMACY: First Creditors' Meeting Set for April 13
C H I N A
CHINA EVERGRANDE: Construction Has Resumed at 95% of Projects
CHINA EVERGRANDE: Former Vice President Under Investigation
CHINA EVERGRANDE: Inks Information-Sharing, Fee Deal With Creditors
GUANGDONG-HONGKONG GREATER: Fitch Puts 'B-' LT IDR on Watch Neg.
H O N G K O N G
HEALTH AND HAPPINESS: S&P Affirms 'BB+' ICR & Alters Outlook to Neg
I N D I A
AAJ KA ANAND PAPERS: Insolvency Resolution Process Case Summary
ABHIJEET TOLL: Insolvency Resolution Process Case Summary
ANILA SEED: CARE Reaffirms B- Rating on INR6.0cr LT Loan
ASHUTOSH CHAWAL: CARE Cuts Rating on INR31cr LT Loan to B+
DIMENSIONS TRADE: Voluntary Liquidation Process Case Summary
GE INDIA BUSINESS: Voluntary Liquidation Process Case Summary
GHAZIABAD ALIGARH: CARE Reaffirms D Rating on INR483.21cr Loan
INDIAN KNIVES: CARE Moves B Debt Rating to Not Cooperating
INNOVATIVE TYRES: Insolvency Resolution Process Case Summary
JAYPEE HEALTHCARE: CARE Reaffirms D Rating on INR593.94cr Loan
JSM DEVCONS PRIVATE: Insolvency Resolution Process Case Summary
KALYAN JEWELLERS: S&P Assigns Preliminary 'B' ICR, Outlook Stable
LOHIA SALES: Voluntary Liquidation Process Case Summary
MADHYA PRADESH: CARE Reaffirms D Rating on INR110.90cr LT Loan
MAX FLEX: Insolvency Resolution Process Case Summary
MYTRAH ADARSH: CARE Cuts Rating on INR538.68cr LT Loan to B+
NEWLINK OVERSEAS: CARE Reaffirms D Rating on INR15cr NCD
NUPOWER RENEWABLES: CARE Reaffirms D Rating on INR169.49cr Loan
PAITHAN MEGA: CARE Reaffirms D Rating on INR28.87cr LT Loan
PAS TRADING: CARE Lowers Rating on INR19.50cr LT/ST Loan to D
POKAR AGRO: Voluntary Liquidation Process Case Summary
RELIANCE MEDIAWORKS: CARE Lowers Rating on INR638.20cr NCD to D
SABER PAPER: ED Tracks Ludhiana Business Family's Swiss Stash
SAEL RG1: Fitch Gives 'BB(EXP)' Rating to Proposed USD Sec. Notes
SHRIRAM EPC: CARE Moves D Debt Ratings to Not Cooperating
SUN-AMP SOLAR: Voluntary Liquidation Process Case Summary
SUPER MAX: CARE Lowers Rating on INR25cr LT Loan to B
TABLEAU SOFTWARE: Voluntary Liquidation Process Case Summary
TARENDRA INFRA: CARE Keeps D Debt Ratings in Not Cooperating
VAISHALI REAL: Insolvency Resolution Process Case Summary
WESTERN INDIA: CARE Keeps C Debt Rating in Not Cooperating
ZOTRES HOSPITALS: CARE Lowers Rating on INR13cr LT Loan to B+
M A L A Y S I A
1MDB: Prosecutor Urges Ex-Goldman Banker's Conviction
N E W Z E A L A N D
A 2 Z NZ: Court to Hear Wind-Up Petition on May 13
BA SCOTT: Creditors' Proofs of Debt Due on May 13
INDUSTRY MANAGEMENT: Creditors' Proofs of Debt Due on April 22
J. AND J. WATT: Creditors' Proofs of Debt Due on May 5
WOODAPPLE LIMITED: Court to Hear Wind-Up Petition on May 27
P H I L I P P I N E S
METRO CEBU PUBLIC: Central Bank Closes Thrift Bank
S I N G A P O R E
ARA LOGOS: Receive Writ of Summons for SGD8MM Claim
ASIARETAIL III: Members' Final Meeting Set for May 6
HM RETAIL: Members' Final Meeting Set for May 6
KYUDENKO SOUTH: Creditors' Proofs of Debt Due on May 5
SCANMICRON PRIVATE: Creditors' Meetings Set for April 19
TAIGER: AI Startup Liquidates Singapore Entity, Over 80 Jobs Axed
- - - - -
=================
A U S T R A L I A
=================
ASI MANAGEMENT: First Creditors' Meeting Set for April 13
---------------------------------------------------------
A first meeting of the creditors in the proceedings of ASI
Management Pty Ltd will be held on April 13, 2022, at 12:00 p.m.
via virtual meeting technology.
Edwin Narayan and Grahame Ward of Mackay Goodwin were appointed as
administrators of ASI Management on April 1, 2022.
CREGGS ASPHALT: First Creditors' Meeting Set for April 13
---------------------------------------------------------
A first meeting of the creditors in the proceedings of Creggs
Asphalt Pty Ltd will be held on April 13, 2022, at 10:30 a.m.
Adam Peter Kersey and David Michael Stimpson of SV Partners were
appointed as administrators of Creggs Asphalt on April 1, 2022.
ROTECH SYSTEMS: First Creditors' Meeting Set for April 14
---------------------------------------------------------
A first meeting of the creditors in the proceedings of Rotech
Systems Pty. Ltd. will be held on April 14, 2022, at 10:00 a.m. via
virtual meeting technology.
Stephen Dixon of Hamilton Murphy Advisory (WA) was appointed as
administrator of Rotech Systems on April 4, 2022.
SALT LAKE: Indicative Bids in May; Recapitalization an Option
-------------------------------------------------------------
Australian Financial Review reports that Salt Lake Potash's sale
advisor Macquarie Capital is understood to have chalked in mid-May
for the first round of bids for the listed company that has been in
receivership since October.
Macquarie's spent the past week dotting the i's and crossing the
t's on the sale documents and is understood to have mailed them out
on April 4, the report says.
While a whole-of-business sale remained the top item on the agenda,
Salt Lake Potash was understood to have added a second potential
solution - a recapitalization, according to AFR.
AFR says the company's got AUD170 million odd in debt owed to
investors including Taurus Funds Management, the Clean Energy
Finance Corporation and Commonwealth Bank of Australia. The lenders
called in the receivers on October 20.
It would be interesting to see if higher fertiliser prices and Salt
Lake Potash's doubling its flagship project Lake Way's resource
succeed in attracting a buyer; and how close the bids get to its
pre-receivership market capitalisation of AUD250 million, the
report states.
Interested parties were expecting a mid-May deadline for indicative
bids but were yet to be informed of the rest of the timetable, AFR
notes.
About Salt Lake Potash
Salt Lake Potash Limited (ASX:SO4) -- https://www.so4.com.au/ --
operates as a mineral exploration company. The Company offers
potash and uranium. Salt Lake Potash conducts business in
Australia.
Salt Lake Potash entered into voluntary administration on October
20, 2021, after the company's directors labelled the business
insolvent. Creditors have appointed KordaMentha as receiver and
manager of the company, while KPMG's Martin Bruce Jones, Thomas
Birch and Hayden White of KPMG were appointed as administrators of
Salt Lake and related entities.
TIMBERTOWN PHARMACY: First Creditors' Meeting Set for April 13
--------------------------------------------------------------
A first meeting of the creditors in the proceedings of Timbertown
Pharmacy Pty Ltd will be held on April 13, 2022, at 10:00 a.m. via
virtual meeting technology.
Scott Newton & Benjamin Ismay of Shaw Gidley were appointed as
administrators of Timbertown Pharmacy on April 4, 2022.
WAUCHOPE PHARMACY: First Creditors' Meeting Set for April 13
------------------------------------------------------------
A first meeting of the creditors in the proceedings of Wauchope
Pharmacy Services Pty Ltd will be held on April 13, 2022, at 10:30
a.m. via virtual meeting technology.
Benjamin Ismay and Scott Newton of Shaw Gidley were appointed as
administrators of Wauchope Pharmacy on April 4, 2022.
=========
C H I N A
=========
CHINA EVERGRANDE: Construction Has Resumed at 95% of Projects
-------------------------------------------------------------
Reuters reports that a unit of China Evergrande Group said
construction work has resumed at 95% of Evergrande's projects
across China as of late March.
Evergrande has resumed work at 734 developments in all of China as
of March 27, including 424 projects recovering to normal
construction levels, according to a post on April 2 on the official
WeChat of the developer's Pearl River Delta business unit, Reuters
relays. The post did not give a figure for Evergrande's total
number of developments.
Evergrande will "continue to maintain the normal construction of
the projects in order to deliver the buildings to the owners with
guaranteed quality and quantity at all costs," according to the
post cited by Reuters.
Reuters says company Chairman Hui Ka Yan has pledged multiple times
since 2021 that the company would resume construction work at full
steam to ensure home deliveries.
Hui told staff in February that the company aimed to deliver
600,000 apartments in 2022, according to a source with direct
knowledge of the matter and media reports, Reuters relates.
"With the strong support from the provincial government,
Evergrande's Pearl River Delta business worked to accelerate the
resumption of work and production," Pearl River Delta said in the
WeChat post.
About China Evergrande
China Evergrande Group is an integrated residential property
developer. The Company, through its subsidiaries, operates in
property development, investment, management, finance, internet,
health, culture, and tourism markets.
Evergrande had CNY1.97 trillion (US$311 billion) of liabilities at
the end of June 2021. Once China's biggest developer by sales,
Evergrande fell into distress as cash dried up and the group
overstretched itself on borrowings and ventures into car
manufacturing.
Evergrande hired outside financial advisers Houlihan Lokey and
Admiralty Harbour Capital in September 2021 to engage with
creditors soon after it ran into a liquidity squeeze. It has since
worked with more advisers in the past two months by turning to
China International Capital Corp, BOCI Asia and Zhong Lun Law Firm
on its debt workout plan.
As reported in the Troubled Company Reporter-Asia Pacific in
December 2021, S&P Global Ratings lowered the issuer credit ratings
on China Evergrande Group and Tianji Holding Ltd. to 'SD' from
'CC'. S&P also lowered the issuer rating on Tianji's bonds due
2022 and 2023 to 'D' from 'C'. S&P subsequently withdrew all its
ratings on Evergrande, its subsidiary Hengda Real Estate Group Co.
Ltd., and Tianji, at the group's request.
The TCR-AP also reported that Fitch Ratings has downgraded to 'RD'
(Restricted Default), from 'C', the Long-Term Foreign-Currency
Issuer Default Ratings (IDR) of China Evergrande Group and its
subsidiaries, Hengda Real Estate Group Co., Ltd and Tianji Holding
Limited. Fitch has affirmed the senior unsecured ratings of
Evergrande and Tianji at 'C', with a Recovery Rating of 'RR6', as
well as the Tianji-guaranteed senior unsecured notes issued by
Scenery Journey Limited at 'C', with a Recovery Rating of 'RR6'.
The downgrades reflect the non-payment of coupons due Nov. 6, 2021
for Tianji's USD645 million 13% bonds and USD590 million 13.75%
bonds after the grace period lapsed on 6 December. The non-payment
is consistent with an 'RD' rating, signifying the uncured expiry of
any applicable grace period, cure period or default forbearance
period following a payment default on a material financial
obligation.
CHINA EVERGRANDE: Former Vice President Under Investigation
-----------------------------------------------------------
The Standard reports that China's anti-corruption watchdog said
Jiang Liming, a former official of China's banking regulator and a
former vice president at China Evergrande, is under investigation.
Jiang is suspected of a "serious breach of discipline and the law,"
the report discloses citing an announcement by the Central
Commission for Discipline Inspection.
Jiang joined Evergrande after leaving the China Banking Regulatory
Commission in 2016. She was the former head of rural, small, and
medium-sized banks at CBRC and has worked for the People's Bank of
China from 1985 to 2003, The Standard notes.
This came as the local government in Hainan changed its decision
and confiscated 39 buildings developed by Evergrande instead of
ordering the embattled developer to demolish them, according to the
repot.
Last year, Evergrande said it received an order from authorities at
Danzhou city in Hainan province telling it to demolish 39
under-construction buildings at the Ocean Flower Island project,
the report recalls.
Local media reported earlier that the buildings - stretched over
435,000 square meters - needed to be demolished for illegal
construction and environmental violations.
Evergrande applied for an administrative review in January this
year and the Danzhou government announced to confiscate the
buildings instead of demolishing them, adding that the legitimate
rights and interests of all parties will be protected in accordance
with the law, local state-owned newspaper the Hainan Daily reported
on April 3, The Standard relays.
About China Evergrande
China Evergrande Group is an integrated residential property
developer. The Company, through its subsidiaries, operates in
property development, investment, management, finance, internet,
health, culture, and tourism markets.
Evergrande had CNY1.97 trillion (US$311 billion) of liabilities at
the end of June 2021. Once China's biggest developer by sales,
Evergrande fell into distress as cash dried up and the group
overstretched itself on borrowings and ventures into car
manufacturing.
Evergrande hired outside financial advisers Houlihan Lokey and
Admiralty Harbour Capital in September 2021 to engage with
creditors soon after it ran into a liquidity squeeze. It has since
worked with more advisers in the past two months by turning to
China International Capital Corp, BOCI Asia and Zhong Lun Law Firm
on its debt workout plan.
As reported in the Troubled Company Reporter-Asia Pacific in
December 2021, S&P Global Ratings lowered the issuer credit ratings
on China Evergrande Group and Tianji Holding Ltd. to 'SD' from
'CC'. S&P also lowered the issuer rating on Tianji's bonds due
2022 and 2023 to 'D' from 'C'. S&P subsequently withdrew all its
ratings on Evergrande, its subsidiary Hengda Real Estate Group Co.
Ltd., and Tianji, at the group's request.
The TCR-AP also reported that Fitch Ratings has downgraded to 'RD'
(Restricted Default), from 'C', the Long-Term Foreign-Currency
Issuer Default Ratings (IDR) of China Evergrande Group and its
subsidiaries, Hengda Real Estate Group Co., Ltd and Tianji Holding
Limited. Fitch has affirmed the senior unsecured ratings of
Evergrande and Tianji at 'C', with a Recovery Rating of 'RR6', as
well as the Tianji-guaranteed senior unsecured notes issued by
Scenery Journey Limited at 'C', with a Recovery Rating of 'RR6'.
The downgrades reflect the non-payment of coupons due Nov. 6, 2021
for Tianji's USD645 million 13% bonds and USD590 million 13.75%
bonds after the grace period lapsed on 6 December. The non-payment
is consistent with an 'RD' rating, signifying the uncured expiry of
any applicable grace period, cure period or default forbearance
period following a payment default on a material financial
obligation.
CHINA EVERGRANDE: Inks Information-Sharing, Fee Deal With Creditors
-------------------------------------------------------------------
The Wall Street Journal reports that China Evergrande Group and
some of its biggest offshore creditors have reached agreement on
moving restructuring talks forward, helping stave off their threats
of taking over the company's offshore businesses after $2 billion
in offshore cash was seized by banks, according to people familiar
with the matter.
Evergrande agreed in principle late last week to pay bondholders'
advisory fees, provide additional due diligence on the company's
financial health, and give creditors a formal role in the
restructuring process, the people familiar with the matter said,
the Journal relays. The fee- and information-sharing agreement is
seen as a moderate step in the right direction rather than
substantial progress to restructure Evergrande's debt, one of the
people said.
According to the Journal, bondholders appear to be changing tack
after they threatened to sue Evergrande in January for allegedly
stonewalling discussions with them. Tensions simmered again after
Evergrande disclosed in March that banks had taken control of more
than $2 billion held by one of its key subsidiaries.
Evergrande reached out to an organized committee of foreign
bondholders soon after the beginning of the Chinese Lunar New Year
to move talks along, according to people familiar. The Journal
relates that the discussions first focused on reaching an agreement
over paying creditors' advisory fees, until Evergrande disclosed
the $2 billion cash seizure at its Hong Kong-registered property
management arm.
Evergrande's bonds are still trading at deeply distressed levels,
although some of the company's debt has recovered slightly from
lows of around 9 cents on the dollar last month. The $2 billion
seizure sent bonds down by about a cent, according to Advantage
Data.
The Journal says some of Evergrande's offshore debts are backed by
subsidiaries incorporated in offshore jurisdictions including the
British Virgin Islands and the Cayman Islands. Because of
Evergrande's nonpayment under some of those debts, the creditors
could in theory seek to file a windup petition in those locations
and take control of the subsidiary.
A request from creditors to appoint a liquidator would be
recognized in those jurisdictions, allowing for potential takeovers
of their boards, said John Han, partner at law firm Kobre & Kim in
Hong Kong, according to the Journal. Creditors could then attempt
to continue taking over subsidiaries until they arrived at a
business with assets or substantial cash flows, likely incorporated
in Hong Kong.
Still, the strategy would have run into legal barriers as soon as
creditors attempted to go after any assets in mainland China, said
Mr. Han, who isn't directly involved, relates the Journal.
Evergrande had roughly $300 billion in liabilities as of last June,
making it the most-indebted Chinese developer, with some $20
billion in outstanding U.S. dollar bonds on its books, the report
discloses. After disclosing work suspensions on some real-estate
projects and delaying payments to suppliers and contractors,
Evergrande missed multiple interest payments due to foreign
creditors in the fourth quarter of last year.
In a call last month to update creditors, Evergrande said it was
working to raise fresh funds from third-party investors in the wake
of the seized cash at the offshore subsidiary, the Journal
recalls.
The report adds that the company also warned that there may be
additional pledges and guarantees made from offshore subsidiaries
to onshore entities that could ultimately erode how much creditors
will recover from Evergrande.
About China Evergrande
China Evergrande Group is an integrated residential property
developer. The Company, through its subsidiaries, operates in
property development, investment, management, finance, internet,
health, culture, and tourism markets.
Evergrande had CNY1.97 trillion (US$311 billion) of liabilities at
the end of June 2021. Once China's biggest developer by sales,
Evergrande fell into distress as cash dried up and the group
overstretched itself on borrowings and ventures into car
manufacturing.
Evergrande hired outside financial advisers Houlihan Lokey and
Admiralty Harbour Capital in September 2021 to engage with
creditors soon after it ran into a liquidity squeeze. It has since
worked with more advisers in the past two months by turning to
China International Capital Corp, BOCI Asia and Zhong Lun Law Firm
on its debt workout plan.
As reported in the Troubled Company Reporter-Asia Pacific in
December 2021, S&P Global Ratings lowered the issuer credit ratings
on China Evergrande Group and Tianji Holding Ltd. to 'SD' from
'CC'. S&P also lowered the issuer rating on Tianji's bonds due
2022 and 2023 to 'D' from 'C'. S&P subsequently withdrew all its
ratings on Evergrande, its subsidiary Hengda Real Estate Group Co.
Ltd., and Tianji, at the group's request.
The TCR-AP also reported that Fitch Ratings has downgraded to 'RD'
(Restricted Default), from 'C', the Long-Term Foreign-Currency
Issuer Default Ratings (IDR) of China Evergrande Group and its
subsidiaries, Hengda Real Estate Group Co., Ltd and Tianji Holding
Limited. Fitch has affirmed the senior unsecured ratings of
Evergrande and Tianji at 'C', with a Recovery Rating of 'RR6', as
well as the Tianji-guaranteed senior unsecured notes issued by
Scenery Journey Limited at 'C', with a Recovery Rating of 'RR6'.
The downgrades reflect the non-payment of coupons due Nov. 6, 2021
for Tianji's USD645 million 13% bonds and USD590 million 13.75%
bonds after the grace period lapsed on 6 December. The non-payment
is consistent with an 'RD' rating, signifying the uncured expiry of
any applicable grace period, cure period or default forbearance
period following a payment default on a material financial
obligation.
GUANGDONG-HONGKONG GREATER: Fitch Puts 'B-' LT IDR on Watch Neg.
----------------------------------------------------------------
Fitch Ratings has placed China-based developer Guangdong - Hong
Kong Greater Bay Area Holdings Limited's (GHKGBA) 'B-' Long-Term
Foreign-Currency Issuer Default Rating (IDR), senior unsecured
rating and outstanding senior unsecured notes' rating on Rating
Watch Negative (RWN).
The RWN reflects the delay in the publication of the company's
audited financial statements. Fitch considers any non-timely
release of audited results as a credit sensitive event, which may
have a negative impact on ratings.
The company has not provided further information to Fitch other
than public announcements.
KEY RATING DRIVERS
Audit Results Delay: GHKGBA said on 31 March 2022 that it would not
release its audited financial statements by 31 March 2022, the
deadline required by Hong Kong listing regulations. It has not
provided a date for the publication of the audited results. The
company said the Covid-19 outbreak had affected the audit process.
It did not mention any potential change in auditors nor are there
any disputes.
Potential Negative Effect: Fitch believes problems with releasing
timely audited results, especially if there is a change in auditor,
may be credit sensitive for developers with ratings in the 'B'
category or above as funding access may be affected, while
potential buyers of the company's assets may be deterred. Fitch
thinks the delay in GHKGBA's audited statement is due to a
technical reason. However, evidence of deterioration in access to
liquidity and financing from a prolonged delay will result in
negative rating action.
Upcoming Maturities: GHKGBA has private offshore bonds of USD75
million due in May 2022 and no other capital market maturities for
the year. Its reported cash and cash equivalents at end-2021 of
CNY1.4 billion, excluding restricted cash of CNY763.5 million,
appear to be sufficient to cover the May maturity.
Contracted Sales May Slow: GHKGBA's contracted sales fell in 2H21,
in line with the property market, to CNY1.6 billion from CNY3
billion in 1H21. Sales may remain slow in 1H22 amid the resurgence
of Covid-19 in China.
Asset Disposals: GHKGBA disposed of equity stakes in some of its
project companies to independent third parties for a total
consideration of HKD184 million in February and March 2022. The
sales may enhance the liquidity of the company to a small extent.
DERIVATION SUMMARY
GHKGBA's ratings are constrained by its small scale and weak
business profile, with contracted sales of CNY4 billion-5 billion a
year. Fitch also believes its access to capital markets could
remain limited in the near term, which means it may use internal
cash to repay its maturities.
KEY ASSUMPTIONS
Fitch's key assumptions within its rating case for the issuer
include:
-- Contracted sales of CNY4 billion-6 billion a year in 2022-2024
(2021: CNY4.6 billion);
-- Unsold land-bank life maintained at about three years and
GHKGBA to slow land acquisition to prioritise debt repayment,
if needed.
Key Recovery Rating Assumptions:
The liquidation estimate reflects Fitch's view of the value of
balance-sheet assets that can be realised in sale or liquidation
processes conducted during bankruptcy or insolvency proceedings and
distributed to creditors
-- 10% administrative claims
-- Advance rate of 80%, raised from 70%, applied to account
receivables. This treatment is in line with Fitch's recovery
rating criteria.
-- 10% advance rate on investment properties, lowered from 20%,
as the rental yield was below 1%. The value of the investment
properties is insignificant. Fitch considers the 10% advance
rate appropriate as the implied rental yield on the
liquidation value for the investment-property portfolio would
improve to 6%.
-- 50% advance rate, lowered from 60%, on property, plant and
equipment, which mainly consist of buildings with
insignificant value.
-- 50% advance rate on net property inventory. GHKGBA's inventory
mainly consists of completed properties held for sale and
properties under development (PUD). Its inventory is a mix of
trade centres in low-tier cities and residential projects in
the Greater Bay Area. The PUD balance - prior to applying the
advance rate - is net of margin-adjusted customer deposits.
-- 50% advance rate on net joint-venture assets, similar to net
property inventory.
-- Trade payables, net of unrestricted cash, are included in the
debt waterfall.
The resulting recovery rate corresponds to a Recovery Rating of
'RR4' for GHKGBA.
RATING SENSITIVITIES
Factor that could, individually or collectively, lead to positive
rating action/upgrade:
-- The RWN would be removed if the negative sensitivities are not
met.
Factors that could, individually or collectively, lead to negative
rating action/downgrade:
-- Evidence of further deterioration in funding access and/or
liquidity;
-- Failure to publish unqualified audited financial results by
April;
-- Sustained decline in contracted sales or cash collection;
-- Net debt/net property assets sustained above 40%.
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.
LIQUIDITY AND DEBT STRUCTURE
Manageable Liquidity: The company's unrestricted cash of CNY1.4
billion at end-2021 appears to be able to cover its short-term debt
of CNY1 billion, including CNY532 million in bank and other
borrowings and USD75 million in private bonds.
ISSUER PROFILE
GHKGBA, listed on the Hong Kong Stock Exchange since 2013, focuses
on residential projects in the Greater Bay Area and develops
trade-centre projects in Chinese third-tier cities. It was known as
Hydoo International Holding Limited before the Wong family sold its
stake to the holding company of GHKGBA in September 2019.
ESG CONSIDERATIONS
Fitch has revised GHKGBA's ESG Relevance Score for Financial
Transparency to '4' from '3' due to the delay in the publication of
the audited 2021 financial results, 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.
=================
H O N G K O N G
=================
HEALTH AND HAPPINESS: S&P Affirms 'BB+' ICR & Alters Outlook to Neg
-------------------------------------------------------------------
S&P Global Ratings revised its outlook on the long-term issuer
credit rating to negative from stable on Health and Happiness (H&H)
International Holdings Ltd. S&P affirmed its 'BB+' long-term rating
and 'BB' issue rating on H&H.
The negative outlook reflects H&H's challenges in defending market
share and margins, which could derail its deleveraging path toward
3x.
H&H faces challenges in defending market share in its key baby
formula segment.
S&P said, "The negative outlook underpins our view that the issuer
will need more resources to protect its market share in the
increasingly competitive infant milk formula market. This comes at
a time when cost pressure is rising, and consumer spending is
tightening. The company's overall growth and EBITDA margin came in
at 3% and 15.3% in 2021, respectively, falling short of our
previous expectations for 5%-10% and 16%-18% levels, respectively.
This is primarily because weaker performance in the infant milk
formula segment, which accounts for about half of H&H's gross
profit, more than offset better adult supplement sales.
"More intense competition in baby formula in light of a declining
birth rate in China will prompt a greater use of promotions and
more investment in distributors. We observed a lower marginal
return from the company's recent additions to its distribution
network. H&H points of sales have grown 50% in the past two years,
but baby formula sales growth fell to 3% and -2% in 2020 and 2021,
respectively, in the baby nutrition segment from double-digit
growth before. The baby formula industry was growing at 0%-2%
during the same period. The company has been upholding its market
share in baby formula so far, but it comes with a cost. In our
view, H&H may be slipping in its aim to bring its ratio of debt to
EBITDA below 3x by 2023. Weaker performance amid a challenging
operating environment largely explains this slippage.
"Inflationary raw material prices and continuously high operating
expenses likely to compress margins. We estimate a 10% increase in
raw material costs will lead to about a 200 basis point (bp)
compression in H&H's gross margin. The prices of raw milk and
whole-milk powder in Europe have gone up 20%-40% in the year
to-date. H&H sources baby formula principally from Europe. The
company does have some options, such as adjusting its product mix
by selling more high-margin probiotic products or adjusting selling
prices, to pass on its cost increases. Nevertheless, intense
competition in baby products will make it difficult for H&H to
fully pass on the inflationary pressure. We assume its gross profit
margin will narrow by 100bps-200bps during 2022-2023.
"We also assume selling and distribution cost as a percentage of
sales to remain high as the company builds up distribution network
in pet nutrition, and invests in baby nutrition to maintain its
market share. We forecast H&H's EBITDA margin will decline to
14%-15% over the next 12-24 months, from 15.3% in 2021, due to
rising input costs and continued high investment in selling and
marketing expenses to maintain market share and ramp up newly
entered pet segments.
"Good sales from pet segment and adult supplement to support EBITDA
growth. We expect the high-margin children probiotics sales to
return to a growth of 10%-20% in the next two years as the company
uses cross-selling across its existing network. Adult nutrition
should be growing at a high-single digit percentage rate. For pet
nutrition, we do not expect a quick ramp-up of the Zesty Paws brand
in China as we saw with Swisse earlier in 2016-2018. The pet
supplement market in China is still nascent, and the ramp-up of pet
products in the offline channel will require more operating
expenses and working capital. We forecast a 15%-25% annual growth
for the pet segment and expect it to become 8%-12% of revenue and
gross profit in the coming two years. However, pet nutrition will
likely be generating below-company-average EBITDA margins during
the ramp-up period.
"H&H's positive free operating cash flow should continue to support
gradual deleveraging. We anticipate minimal capital expenditure,
acquisition suspension, and a dividend cut to 30% from 50% as the
company preserves cash. Operating cash flow will temporarily dip in
2022 to RMB1.1 billion–RMB1.3 billion from RMB1.6 billion in 2021
due to lower margins, rising interest expenses, and higher working
capital (largely due to ramping up the pet nutrition business). We
assume no further acquisition spending over the next two years
because the company will focus on growing the pet nutrition
business, and deleveraging.
"Absent any sizable acquisitions, H&H's credit metrics should
gradually improve as it continues to generate solid free operating
cash flow. We project free operating cash flow to decline to RMB1.0
billion-RMB1.2 billion in 2022 and recover to RMB1.2 billion-RMB1.4
billion in 2023, from RMB1.6 billion in 2021. We forecast its
debt-to-EBITDA ratio will decline to 3x by late 2023, from our
forecast of 3.4x-3.6x in 2022. However, a 15% decline in EBITDA
from our base-case assumptions could result in the debt-to-EBITDA
ratio remaining at 3x in 2023."
H&H should maintain ample liquidity and its extended maturity
profile.
S&P said, "H&H has swiftly arranged US$1.125 billion in three-year
syndicated loans to refinance debt maturing in 2022 and 2023, after
opting out of the bond issuance planned for January 2022. We
believe the company will continue to manage its maturity profile,
as apparent by its refinancing actions ahead of maturities in 2018
and 2019. The company now has sizable debt maturities, about RMB5.2
billion in 2024--in particular its US$300 million secured notes and
about half of the syndicated loan. We expect H&H to maintain
adequate liquidity and an extended maturity profile with weighted
average maturity of above two years.
"The negative outlook underpins our view that more resources will
be necessary to defend its market share in the increasingly
competitive infant milk formula market. We see a one-in-three
chance that H&H will be downgraded in the next 12-24 months as a
result. We forecast the company will register organic growth of
3%-6%, and its EBITDA margin will decline to 14%-15% in the
period."
Downside scenario
S&P could lower the ratings if it assesses a weakening of the
business strength. Diminished market share trend and pricing power
may indicate this weakening. Such a scenario would likely translate
to a ratio of debt-to-EBITDA staying above 3x, or its ratio of free
operating cash flow to debt dropping below 15%.
S&P may also lower the ratings if H&H undertakes further
debt-funded acquisitions, more aggressive capital investments, or
shareholder returns are more generous than it now expects.
Upside scenario
S&P could revise the outlook back to stable if H&H cuts its ratio
of debt-to-EBITDA to 3x or below sustainably, while maintaining
market share in its key product categories, namely baby formula and
adult supplements, during the next 12-24 months.
H&H manufactures and sells nutritional and baby care products in
mainland China, Australia, New Zealand, and other countries. Its
baby nutrition and care segment produces milk formulas, baby care
products, and probiotic supplements mainly under the brand
Biostime. Its adult nutrition and care segment sells vitamins,
health supplements, and products on skin care and sports nutrition
for adults mainly under the Swisse brand. H&H recently expanded
into the pet nutrition and care segment by acquiring Solid Gold and
Zesty Paws, both U.S. brands.
Headquartered in Hong Kong, H&H was listed on the Hong Kong stock
exchange in 2010. Its founder, Luo Fei, and other founding partners
control 67% of H&H's shares via Biostime Pharmaceuticals (China)
Ltd.
=========
I N D I A
=========
AAJ KA ANAND PAPERS: Insolvency Resolution Process Case Summary
---------------------------------------------------------------
Debtor: M/s. Aaj Ka Anand Papers Limited
365 Shivaji Nagar
Aaj Ka Anand Building
Pune MH 411005
IN
Insolvency Commencement Date: April 1, 2022
Court: National Company Law Tribunal, Surat Bench
Estimated date of closure of
insolvency resolution process: September 27, 2022
Insolvency professional: CA Vineeta Maheshwari
Interim Resolution
Professional: CA Vineeta Maheshwari
3rd Floor, Reegus Business Centre
New Citylight Road
Above Mercedes Benz Showroom
Bharthana-Vesu, Surat 395007
E-mail: ipvineetak@gmail.com
ipvin.anand@gmail.com
Last date for
submission of claims: April 14, 2022
ABHIJEET TOLL: Insolvency Resolution Process Case Summary
---------------------------------------------------------
Debtor: Abhijeet Toll Road (Karnataka) Limited
FE-83, Sector-III
Salt Lake City, Ground Floor
Kolkata, WB 700106
Insolvency Commencement Date: March 31, 2022
Court: National Company Law Tribunal, Bench-I, Kolkata
Estimated date of closure of
insolvency resolution process: September 27, 2022
(180 days from commencement)
Insolvency professional: Mr. Anil Matta
Interim Resolution
Professional: Mr. Anil Matta
Matta & Associates
308, RG Trade Tower
Plot No. B-7
Netaji Subhash Place
Pitampura, New Delhi 110034
E-mail: mattaassociates@gmail.com
irpabhitollkarnataka@gmail.com
Last date for
submission of claims: April 18, 2022
ANILA SEED: CARE Reaffirms B- Rating on INR6.0cr LT Loan
--------------------------------------------------------
CARE Ratings has reaffirmed ratings on certain bank facilities of
Anila Seed Processing Industries (ASPI), as:
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long Term Bank
Facilities 6.00 CARE B-; Stable Reaffirmed
Detailed Rationale & Key Rating Drivers
The ratings assigned to the bank facilities of ASPI continues to be
tempered by Small scale of operations, leveraged capital structure
and weak debt coverage indicators, working capital intensive
operations and stretched liquidity during FY21 (refers to the
period April 1 to March 31). Further the ratings remained
constrained on account of highly fragmented industry with intense
competition from large number of players and Proprietorship nature
of business with inherent risk of withdrawal of capital.
The rating, however, derive its strengths from Long track record of
operations with experienced promoters for more than two decades in
cotton industry, healthy demand outlook of seed market and
satisfactory profit margins.
Rating Sensitivities
Positive factors:
* Increase in scale of operations marked by total operating income
increasing beyond INR30.00 crores while improving its
profitability margins leads to substantial increase in GCA
* Improve the gearing ratio to below 1.50x on a sustained basis
Negative Factors
* Significant decline in profitability margin marked by PBILDT
margin falling below 5% in future
* Any major debt funded capex resulting to deterioration in capital
structure with overall gearing leveraging beyond 4.00
times in any of the future years
Detailed description of the key rating drivers
Key Rating Weaknesses
* Small scale of operations: The scale of operations of the firm
has marginally increased but remained small at INR10.88 crore
during FY21 as against INR10.44 crore in FY20 on account of
increase in demand from its group entity. Further, the firm has low
net worth of INR1.47 crore as on March 31, 2021 as compared to
other peers in the industry.
* Leveraged capital structure and weak debt coverage indicators:
The capital structure of the firm has deteriorated and remained
leveraged marked by overall gearing ratio of 4.56x as on March 31,
2021- as against 3.75x as on March 31, 2020 on account of decrease
in capital base due to withdrawal of capital by proprietor and
increase in debt level by availing COVID loan. Debt coverage
indicators have improved with increase in profitability in absolute
terms but remained weak marked by TDGCA ratio of 28.11 years and
interest coverage ratio of 1.29x during FY21 as against 30.74 years
and 1.24x during FY20.
* Working capital intensive nature of operations: The operating
cycle of the company has improved but remained elongated during
FY21 and stood at 127 days as against 179 days during FY20. The
marginal improvement was on account of improved inventory period
and collection period. The company receives the payment from its
customer generally within 4-5 months. However, some times the
credit period is extended upto 1 year depending on the quantum of
sales made. Furthermore, the company makes the payment to its
suppliers (Farmers) within 5-6 months. The company sometimes avail
extension in credit period from its suppliers due to long standing
relationship and the company maintains an average inventory of 4
months for anticipation of better sales realization. Since, the
life span of seed is for three years, hence the company maintains
high inventory to meet the customers requirement as on need basis.
* Highly fragmented industry with intense competition from large
number of players: Indian Agro Industry is highly fragmented in
nature with several organized and unorganized players. High
dependence on agro sector, Lower productivity, Unfavorable Labor
Laws are a few drawbacks of the industry from which it has to
overcome. The biggest challenge facing the Indian agro industry is
competition from the other lowcost neighboring countries which
attract more business from the international market because of
lower production costs, ease in doing business and easier trade
routes.
* Proprietorship nature of business with inherent risk of
withdrawal of capital: The firm being in a proprietorship concern
is exposed to inherent risk of capital withdrawal by proprietor due
to its nature of constitution. Any significant withdrawals from the
capital account would be impacted the net worth and thereby the
firm's capital structure. During FY21, The proprietor has withdrawn
the capital of INR0.33 crore as against infusion of INR0.43 crore
during FY20.
Key Rating Strengths
* Long track record of operations with experienced promoters:
Anila Seed Processing Industries (ASPI) was established in 2009 and
promoted by Mr. Vidyanath Reddy. The proprietor has around 30 years
of experience in trading of seeds. Through his vast experience in
trading business, they have established healthy relationship with
key suppliers, customers, local farmers, dealers and also with the
brokers facilitating the ease in sale of products.
* Satisfactory profitability margins: The Profitability margins of
the firm continues to remain satisfactory marked by improved PBILDT
margin of 9.73% FY21 as against 9.69% FY20. The improvement was on
account of declined material cost on proportionate basis.
Consequently, PAT margin of the firm is marginally improved at
1.59% in FY 21 as against 1.25% in FY20.
* Healthy demand outlook of seed market: Seed is the most basic
unit for cultivation of crops. It is a fertilized ripened ovule,
capable of reproducing and developing into a plant. Seeds include
cereals, pulses, vegetables, and fruits. Innovations in technology
have improved the quality of seeds and provided a wide variety with
desired characteristics and suited to specific conditions and
geographies. This development is necessary for ensuring the
best-quality crop production and meeting the growing demand for
food worldwide. The Global Seeds market is highly dependent on the
demand for agricultural products. With a rise in global population,
a 60 percent increase in food production is to be attained by 2050
to keep up with the food demand.
Liquidity analysis: Stretched
Liquidity remained stretched marked by tightly matched cash
accruals to meet its debt repayment. The average utilization of
working capital limits remained at 98% for past twelve months ended
February 2022. The net cash flow from operating activities has
improved and remained at INR1.50 crore during FY21 as against
INR0.81 crore during FY20, the improvement was on account of
realization of funds from inventories. As on March 31, 2021, Cash
and bank balance remained low at INR0.01 crore.
Telangana-based, Anila Seed Processing Industries (ASPI) was
established as a proprietorship concern in 2009 by Mr. Vidyanath
Reddy. ASPI is engaged in processing and trading of seeds like
paddy, maize, jowar, bajra and among others. The firm procures
different varieties of seeds from farmers located at Karimnagar,
Metpally, Eluru, Giddaluru and etc. The firm sells its products to
its associate concern Shakthi Seeds Private Limited (SSPL, rated
CARE B; Stable), located at Hyderabad. The current installed
capacity of firm has 120 tons per day.
ASHUTOSH CHAWAL: CARE Cuts Rating on INR31cr LT Loan to B+
----------------------------------------------------------
CARE Ratings has revised the ratings on certain bank facilities of
Ashutosh Chawal Udyog (ACU), as:
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long Term Bank 31.00 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 has been seeking information vide e-mail
communications/letters dated January 25, 2022, February 4, 2022,
and March 5, 2022, March 9, 2022 and numerous phone calls. However,
despite CARE's repeated requests, the firm has not provided the
requisite information for monitoring the ratings including NDS for
the month ended February 2022. In line with the extant SEBI
guidelines, CARE has reviewed the rating on the basis of the best
available information which however, in CARE's opinion is not
sufficient to arrive at a fair rating. The rating on ACU bank
facilities will now be denoted as CARE B+; 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(s).
The revision in the ratings assigned to the bank facilities of ACU
is on account of non-availability of requisite information due to
non-cooperation with CARE's efforts to undertake a review of the
outstanding ratings.
Detailed description of the key rating drivers
At the time of last rating on March 31, 2021, the following were
the rating strengths and weaknesses:
Key Rating Weaknesses
* Modest scale of operations with moderate profitability margins:
The scale of operation of the firm stood modest with Total
Operating Income (TOI) of INR70.32 crore, declined by 23.48% in
FY20 over FY19 mainly due to lower sale realization and closer of
unit for 12 days in March 2020 due to COVID-19. Further, the
profitability of ACU remained moderate with PBILDT margin and PAT
margin of 4.14% and 0.66% respectively in FY20. PBILDT margin of
the firm has improved by 65 bps in FY20 over FY19 owing to decrease
in cost of traded goods. Further, due to increase in PBILDT margin,
PAT margin has also improved marginally although remained in line
at 0.66% as against 0.62% owing to higher interest costs. However,
GCA level of the firm has declined by 10.50% in FY20 and stood at
INR1.28 crore. Operating cycle of firm stood elongated at 154 days
in FY20 increased from 93 days in FY19 owing to increase in average
inventory period. Further, it has utilized almost full of its
working capital bank borrowings during past twelve months ended
February 28, 2021.
* Weak solvency position: The capital structure stood leveraged
marked by overall gearing of 3.94 times as on March 31, 2020
although improved from 4.51 times as on March 31, 2019 mainly due
to increase in net worth base owing to accretion of profit to
reserve and schedule repayment of term loan which offset by
increase in unsecured loans. Further, the debt coverage indicators
also stood weak marked by total debt to GCA of 21.67 times as on
March 31, 2020 deteriorated from 19.54 times as on March 31, 2019
mainly due to higher total debt and decline in GCA level. Further,
interest coverage also stood moderate and remained stable at 1.79
times in FY20 (1.80 times in FY19).
* Fragmented nature of industry and low entry barriers: The rice
milling business requires limited quantum of investment in
machinery, however, has high working capital needs. Further, rice
milling is not very technology intensive and as a consequence the
industry is highly fragmented with large number of players
operating in the organized and unorganized segments. The high level
of competition has ensured limiting bargaining power, as a
consequence of which rice mills are operating at low to moderate
profitability margins.
Key Rating Strengths
* Experienced management: The overall affairs of the firm are
managed by Mr. Satya Narayan Jajoo and Mr. Narendra Jajoo. Further,
Mr. S.N. Jajoo has more than two decades of work experience in the
industry and looks after sales & marketing and finance function of
the firm. Mr. Narendra Jajoo has more than 15 years of work
experience in the industry and looks after production function of
the firm.
* Established track record of operations and proximity to paddy
growing region: Being present in the industry since last three
decades, ACU has established its relationship with its customers.
The firm mainly sells basmati rice in domestic market mainly in
Rajasthan, Madhya Pradesh, Gujarat, Maharashtra and Delhi. It also
sells basmati rice to export houses who subsequently export to
other countries. Further, the rice mill of the firm is located in
Bundi which falls in Chambal Command Area of Rajasthan and Madhya
Pradesh. Hence, its presence in this area ensures easy raw material
access and smooth supply of raw materials at competitive prices and
lower logistic and storage cost.
* Impact of COVID19: In view of the national lockdown imposed by
the government to contain the spread of virus, the plant operations
of the firm were closed from March 20, 2020 and resumed from May
01, 2020. Further, till March 17, 2021 it has registered TOI of
INR80.52 crore.
Bundi (Rajasthan) based ACU was formed in 1981 as a proprietorship
concern by Mr. Chouthmal Maheshwari for carrying out the business
of trading and processing of paddy to produce rice. However, due to
death of the proprietor in February 2013, the constitution of the
firm was changed to partnership. Currently, there are four partners
in the firm viz. Mr. Vijendra Kumar Maheshwari, Mr. Satya Narayan
Jajoo, Mr. Chetanya Kumar Jajoo and Mr. Narendra Kumar Jajoo
sharing profit and loss equally. Its rice mill is located in Bundi
and spread across 2623 sq. meter area with installed capacity of 8
Ton Per Hour (TPH). The firm sells rice under the brand name of
'Double Katar' and 'Basant Bahar'. Further, the firm also sells
by-products of rice viz. husk and rice bran.
DIMENSIONS TRADE: Voluntary Liquidation Process Case Summary
------------------------------------------------------------
Debtor: Dimensions Trade and Commerce Ltd
G-94, Dreams The Mall
L.B.S. Marg, Bhandup (West)
Mumbai 400078
Liquidation Commencement Date: March 28, 2022
Court: National Company Law Tribunal, Mumbai Bench
Insolvency professional: Girish Krishna Hingorani
Interim Resolution
Professional: Girish Krishna Hingorani
5C Mehta Sadan
S H Parelkar Marg
Dadar, Mumbai 400028
E-mail: girish2207@rediffmail.com
Mobile: 9820099783
Last date for
submission of claims: April 27, 2022
GE INDIA BUSINESS: Voluntary Liquidation Process Case Summary
-------------------------------------------------------------
Debtor: GE India Business Services Private Limited
A-18, First Floor
Okhla Industrial Area, Phase II
New Delhi 110020
Liquidation Commencement Date: March 31, 2022
Court: National Company Law Tribunal, New Delhi Bench
Insolvency professional: Vikram Kumar
Interim Resolution
Professional: Vikram Kumar
J-6A, Kailash Colony
New Delhi 110048
Tel: +919818119504
E-mail: vikramau@gmail.com
ip.geibspl@gmail.com
Last date for
submission of claims: April 30, 2022
GHAZIABAD ALIGARH: CARE Reaffirms D Rating on INR483.21cr Loan
--------------------------------------------------------------
CARE Ratings has reaffirmed ratings on certain bank facilities of
Ghaziabad Aligarh Expressway Private Limited (GAEPL), as:
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long Term Bank
Facilities 483.21 CARE D Reaffirmed
Detailed Rationale & Key Rating Drivers
The ratings assigned to the bank facilities of GAEPL continues to
remain constrained by the ongoing delays in debt servicing due to
poor liquidity position. The rating also takes into account
deterioration in financial performance in FY21 (refers to the
period April 1 to March 31).
Rating Sensitivities
Positive Factors - Factors that could lead to positive rating
action/upgrade:
* Regularization of debt servicing for a continuous period of 3
months
* Company earning sufficient cash accruals so as to meet its debt
repayment obligations
Negative Factors- Factors that could lead to negative rating
action/downgrade: Not Applicable
Detailed description of the key rating drivers
Key Rating Weaknesses
* On-going delays in debt servicing: There are on-going delays in
debt servicing obligation of the company. Collection of inadequate
toll vis-à-vis the repayment obligations of the company has
resulted in a stretched liquidity position of the company, thus
resulting into delays. On interaction with the lenders, the lender
has confirmed on-going delays in debt servicing.
* Deterioration in financial performance in FY21: The total
operating income of the company witnessed a de-growth of ~28% in
FY21 and stood at INR201.77 crore as compared to INR281.85 crore in
FY20 amid covid-19 impacted year. However, there has been
improvement in operating margin and it stood at 73.60% in FY21 as
against 67.54% in FY20 on account of lower expenses. On the
contrary, the PAT margins moderated to 6.04% in FY21 vis-a-vis
6.58% in FY20. The company generated gross cash accruals of
INR56.76 crore during FY21.
Liquidity: Poor
The company has poor liquidity position and there has been on-going
delay in debt servicing.
GAEPL, incorporated in December 2009, was promoted by SREI
Infrastructure Finance Ltd., PNC Infratech Ltd. and Galfar
Engineering and Contracting India Pvt. Ltd as a Special Purpose
Vehicle (SPV) to undertake the four laning of Ghaziabad to Aligarh
section of NH-91 spanning 126.3 km, under NHDP Phase III in the
state of Uttar Pradesh on Build, Operate and Transfer (BOT)–Toll
Basis. The Concession Agreement (CA) was executed between GAEPL
(Concessionaire) and National Highways Authority of India (NHAI) on
May 20, 2010 for a concession period of 24 years from the appointed
date (i.e. February 25, 2011). The project had already commenced
partial tolling whereby 103.89 k.m. of stretch out of total project
stretch of 126.30 k.m. had become operational from June 23, 2015
onwards vis-à-vis the scheduled COD of end of March 2015. Such
scheduled COD of the project had been further extended to April 26,
2016 by NHAI. The company had received provisional completion
certificate for additional length of 19.41 k.m. on December 20,
2016 and tolling has started for this additional length from
December 22, 2016. The company has further completed 700 metres and
now the total operational length is 124 km out of the total project
length of 126.30 km. Out of the balance 2.3 km stretch, the company
has completed 1.3 km and applied for COD of the same while for the
rest 1 km stretch, the company has applied for de-scope. The
concession period of the project being 24 years and toll collection
has commenced from June 23, 2015. The total cost which has already
been incurred till March 31, 2020 is INR2265.76 crore.
INDIAN KNIVES: CARE Moves B Debt Rating to Not Cooperating
----------------------------------------------------------
CARE Ratings has migrated ratings on certain bank facilities of
Indian Knives and Tools Company (IKTC), as:
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long Term Bank 5.50 CARE B; Stable; ISSUER NOT
Facilities COOPERATING; Rating moved to
ISSUER NOT COOPERATING category
Detailed Rationale & Key Rating Drivers
IKTC has not paid the surveillance fees for the rating exercise as
agreed to in its Rating Agreement. In line with the extant SEBI
guidelines, CARE Ratings Ltd.'s rating on IKTC's 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(s).
The rating assigned to the bank facilities of Indian Knives and
Tools Company (IKTC) is constrained by small scale of operation
coupled with low capitalization, highly leveraged capital structure
and moderate debt coverage indicators and working capital intensive
nature of its operation in FY21 (refers to the period from April 1
to March 31). The rating is further constrained by susceptibility
of profitability to volatile raw material prices, cyclical nature
of industry and high competition, constitution of the entity as
proprietor firm with inherent risk of withdrawal of capital and
project funding, execution and stabilization risk. The above
constraints are partially offset by long track record of the entity
along with experienced and resourceful promoter and healthy
profitability margins.
Detailed description of the key rating drivers
At the time of last rating on May 10, 2021 the following were the
rating strengths and weaknesses (updated from information available
from client)
Key rating Weakness
* Growing albeit small scale of operation coupled with low
capitalization: Scale of operations continued to remain small
marked by a TOI of INR4.17 crore at the end of FY21 as compared to
INR3.82 crore at the end of the previous year.
* Highly leveraged capital structure and moderate debt coverage
indicators: Despite a marginal decline in overall debt and
accretion of profits to reserves; capital structure of IKTC remains
leverage marked by an overall gearing of 2.83x as on March 31, 2021
(P.Y.: 3.85x). Debt coverage indicators remained moderate marked by
stable profitability and interest costs. Interest coverage stood at
2.43x at the end of FY21 compared to 2.29x at the end of FY20.
Whereas, TD/GCA improved marginally and stood at 4.94 years
compared to 6.28 years in the previous year.
* Working capital intensive nature of operations: Operations of the
firm remained working capital intensive marked by a high inventory
holding period which stood at 159 days at the end of FY21 compared
to 177 days at the end of FY20. CC limit utilization remains close
to 80% as per banker's feedback.
* Susceptibility of profitability to volatile raw material prices:
IKTC's majorly procures its raw material namely steel from local
suppliers which constitute about 50-60% of the total operating
cost of the company. Further prices of steel are highly volatile in
nature, therefore the profitability margins of the entity, remains
exposed to the raw material price fluctuation and volatility.
* Cyclical nature of industry and high competition: IKTC operates
in a highly competitive & fragmented industry with many organized
players engaged in manufacturing of industrial cutting instruments
namely Wood peeling knives, punching machine plates, sheet cutter,
shear blades, paper cutting knives, plastic granulator blades,
press break tools and any order as per customers specifications
etc. However, the diversified product profile of IKTC reduces its
dependence on any one product thereby increasing its ability to
withstand cyclicality in the industrial cutting instruments
industry.
* Constitution of the entity as proprietor firm with inherent risk
of withdrawal of capital: IKTC being a proprietorship entity, the
risk associated with withdrawal of proprietor's capital exists. The
entity is exposed to inherent risk of proprietor's capital being
withdrawn at time of personal contingency as also it has limited
ability to raise capital and poor succession planning may result in
dissolution of entity. Due to the proprietorship constitution, it
has restricted access to external borrowing where net worth as well
as credit worthiness of proprietor is the key factors affecting
credit decision of lenders.
* Project funding, execution and stabilization risk: In order to
meet the growing customer demand, IKTC has undertaken capacity
expansion project to set up new manufacturing facility situated at
MIDC, Lote Parshuram Industrial Area, Dhamandevi, Khed Distic,
Ratnagiri, Maharashtra, wherein the existing old manufacturing
facility located at Vasai, Palghar would be shifted to the new
plant. The estimated project cost is INR8.13 crore which is towards
purchase of land, construction of new building, procurement and
up-gradation of plant & machinery along with capacity enhancement
and other expense and same will be funded by way of term loan worth
INR4.50 crore (not yet tied up) and cash credit worth INR1.60 crore
from the bank and balance of INR2.03 crore would be by way owned
funds promoters. Further this promoter had purchased land in 2015
and construction activity is completed upto plinth level and
approx. INR0.50 crore is incurred toward the project and the same
has been funded through owned funds. Further the trial period of
commercial production is expected to be completed before December,
2021. Thus, going forward IKTC's ability to complete the project in
timely manner without any cost and time overrun and subsequent
stabilization of the same along with optimal utilization of the
enhanced production capacities remains critical from credit
perspective.
Key Rating Strengths
* Long track record of the entity along with experienced promoter:
Established in 1994, IKTC is promoted by Mr. Sunil Balkrishna
Chalke, is (Bachelor of Science) with more than three decades of
business experience in manufacturing of industrial knives. Thus,
the long track record and comprehensive experience of promoter
helped IKTC to develop business relationship with existing as well
as new clients & have generated sizeable business on continual
basis. Moreover, the promoters are resourceful and continuously
infusing the funds in form of interest free unsecured loans into
the business to support its growing operations.
* Fluctuating albeit healthy profitability margins: IKTC's
operating profitability remained stable at 23.71% at the end of
FY21 compared to 23.17% at the end of the previous year.
Indian Knives and Tools Company (IKTL), established in 1994 by Mr.
Sunil Balkrishna Chalke, having more than three decades of
experience in manufacturing and trading business of industrial
cutting instruments. The entity procures required raw material
namely steel, grinding wheels, abrasion resistance steel plate etc.
from local suppliers. Further entity manufacturing various shapes,
size, sharpness and thickness of industrial cutting instruments
which find application mainly in paper and plastic industries and
generated 100% of revenue from the domestic market only.
INNOVATIVE TYRES: Insolvency Resolution Process Case Summary
------------------------------------------------------------
Debtor: M/s Innovative Tyres & Tubes Limited
1201, 1202, 1203 GIDC Halol
Panchmahals, Halol
Gujarat 389350
India
Insolvency Commencement Date: March 28, 2022
Court: National Company Law Tribunal, Ahmedabad Bench
Estimated date of closure of
insolvency resolution process: September 23, 2022
(180 days from commencement)
Insolvency professional: Mr. Abhishek Nagori
Interim Resolution
Professional: Mr. Abhishek Nagori
330/348, Third Floor
Tower A, Atlantis K-10
Opp. Vadodara Central
Sarabhai Main Road
Vadodara 390023
Gujarat, India
E-mail: cirp.ittl@ddip.in
jlnusb@gmail.com
Last date for
submission of claims: April 11, 2022
JAYPEE HEALTHCARE: CARE Reaffirms D Rating on INR593.94cr Loan
--------------------------------------------------------------
CARE Ratings has reaffirmed ratings on certain bank facilities of
Jaypee Healthcare Ltd (JHL), as:
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long Term Bank
Facilities 593.94 CARE D Reaffirmed
Detailed Rationale & Key Rating Drivers
The rating assigned to the bank facilities of JHL continues to
factor in delays in debt servicing by the company.
Rating Sensitivities
Positive Factors- Factors that could lead to positive rating
action/upgrade
* Timely track record of debt servicing by the company for
continuous 3 months.
* Sustainable improvement in financial profile along with cash
profits
Detailed description of the key rating drivers
Key Rating Weaknesses
* Delay in debt servicing obligation: The liquidity position of the
company continues to remain weak on account of weak financial
performance leading to delay in debt servicing.
Liquidity: Poor
JHL has poor liquidity position marked by inadequate cash accruals
when compared to repayment obligations for FY22. The current and
quick ratios of the company stood weak at 0.06x and 0.05x, as on
March 31, 2021 (PY: 0.09x and 0.08x).
Jaypee Healthcare Ltd (JHL), a 100% subsidiary of Jaypee Infratech
Ltd (JIL, rated CARE D), has a multi-specialty tertiary hospital
located at Jaypee Wish Town, Noida. The hospital is 504 bedded (300
operational beds) multi super Specialty hospital with 18 operation
theatres and 35 specialties including Liver Transplant and
Radiation Oncology.
JSM DEVCONS PRIVATE: Insolvency Resolution Process Case Summary
---------------------------------------------------------------
Debtor: JSM Devcons Private Limited
Office No. 306, Orbit Mall
Scheme No. 54, A.B. Road
Indore, MP 452001
Insolvency Commencement Date: March 17, 2022
Court: National Company Law Tribunal, Indore Bench
Estimated date of closure of
insolvency resolution process: September 13, 2022
Insolvency professional: Sanjay Kumar Singh
Interim Resolution
Professional: Sanjay Kumar Singh
003, Windsor Grand Forte
Plot No. 76, Sigma-IV
Greater Noida
Uttar Pradesh 201310
E-mail: singhsk.adv@gmail.com
cirp.jsmdevcons@gmail.com
Classes of creditors: Real Estate Allottees
Insolvency
Professionals
Representative of
Creditors in a class: Mr. Anish Agarwal
605A, R S Tower
Circular Road, Ranchi
Jharkhand 834001
E-mail: ip.cispl@gmail.com
Mr. Santosh Sharma
First floor, House no. 17/7
Ashok Nagar, New Delhi 110008
E-mail: sci.santoshsharma@gmail.com
Mr. Sunil Prakash Sharma
E-25, Lajpat Nagar-3
New Delhi 110024
E-mail: adv.sunilprakash@gmail.com
Last date for
submission of claims: April 14, 2022
KALYAN JEWELLERS: S&P Assigns Preliminary 'B' ICR, Outlook Stable
-----------------------------------------------------------------
S&P Global Ratings assigned its preliminary 'B' long-term issuer
credit rating to India-based Kalyan Jewellers India Ltd. S&P also
assigned its preliminary 'B' long-term issue rating to the proposed
senior secured notes issued by Kalyan Jewellers FZE and guaranteed
by Kalyan Jewellers.
The stable outlook on Kalyan Jewellers reflects S&P's expectation
that the company will maintain its market position and steady
revenue growth, and manage leverage and liquidity prudently even as
it expands.
Kalyan Jewellers' business position is constrained by its small
scale of operations, and weaker profit margin compared to global
peers, partially tempered by good brand recognition and favorable
growth prospects. Kalyan Jewellers operates in the highly
fragmented and competitive India jewelry retail market. While it is
the second-largest pan-India jewelry retailer, its market share was
only about 2% of the country's US$60 billion jewelry retail market.
This market is dominated by unorganized players, which have about a
70% share. Given S&P's forecast revenue of US$1.5 billion-US$1.7
billion over the next two years, it considers the company's scale
as small. Also, it has geographic concentration in India and a
small presence in the Middle East, unlike higher rated peers such
as Signet Jewelers Ltd. (BB-/Stable/--), which has over US$5
billion in revenue and operates in multiple countries.
Kalyan Jewellers' EBITDA margin of 7.5%-8.0%, though comparable to
other organized players in India, is 5-10 percentage points lower
than global peers' because gold jewelry dominates its product mix.
The company's gross margin is determined by the making charge,
which is a mark-up based on gold price and weight. Kalyan
Jewellers' lower margin is driven by the lower making charge of
gold jewelry, which has a lower gross margin of about 15% against
35% for studded jewelry. S&P forecasts gold jewelry will remain a
key driver of Kalyan Jewellers' revenue with over 75% contribution
in fiscals 2022-2024 (years ending March), with the remaining
contributed by studded jewelry.
Growth prospects for organized gold jewelers in India are
favorable, with Technopak Advisors forecasting India's gold demand
will grow about 7% annually over the next five years. The business
consulting firm also expects the market share of organized players
to increase to about 40% by 2025, from about 30% currently. It
attributes the increase to greater tax compliance and mandatory
hallmarking, which is a mark applied to the gold to certify the
purity. Kalyan Jewellers, as one of two jewelry retailers with a
nationwide presence, is well-poised to capture this growth.
S&P forecastz Kalyan Jewellers will post 10%-12% revenue growth
over fiscals 2023 and 2024, on the back of a 20%-25% growth in
fiscal 2022. Its nationwide presence, hyper-local strategy, and My
Kalyan platform support the above-industry growth expectations. The
company's hyper-local strategy tailors inventory and design to
local preferences while its My Kalyan platform redirects customer
traffic from semi-urban and rural areas to its showrooms in the
city.
S&P believes gold demand will remain relatively resilient in India.
This will be supported by wedding-driven demand, a cultural
affinity toward gold jewelry and a culture of viewing gold as an
investment. This was evident in fiscal 2021, when Kalyan Jewellers'
Indian operations saw a lower revenue impact than its Middle East
operations during the COVID-19 pandemic. Indian revenues declined
about 6.5% in fiscal 2021 whereas the Middle East operations
reported a 46% decline. The Middle East operations represent
15%-20% of the company's sales.
Kalyan Jewellers' growth plans will test its execution ability
given its short track record of managing growth.
The company plans to open 12-14 new stores per year in India over
the next two to three years. The growth plan is higher than its
historical five-year average of eight to nine new stores in India
per annum. About half of the new stores will be opened outside
south India where Kalyan Jewellers is less established, compared
with its home market of south India. The company's growth plans and
execution have been affected by disruptions due to COVID-19 in
fiscal 2021 and operational issues such as the change of strategy
with regard to My Kalyan in fiscal 2019.
However, risks to the expansion are partly mitigated by growing
within the states where the company is already present, and through
smaller stores, mainly through leasing, resulting in less upfront
costs than store acquisition. Kalyan Jewellers added 14 new
showrooms in India in the first nine months of fiscal 2022,
bringing the number of showrooms to 151 as of Dec. 31, 2021. Also,
the majority of the company's capital expenditure (capex) is funded
through internally generated cash flow and cash balance. In
addition, the expansion is discretionary, and can be scaled down if
needed. For instance, Kalyan Jewellers scaled down capex by 60% in
fiscal 2021 to preserve cash due to the impact of COVID-19.
Kalyan Jewellers' deleveraging will be gradual due to growth plans.
Due to the company's capex of Indian rupee (INR) 1.5
billion–INR1.6 billion annually over next two years, we expect no
meaningful free operating cash flow (FOCF) generation. S&P
forecasts the ratio of funds from operations (FFO) to debt will be
about 15% in fiscal 2022, gradually improving to 16%-17% over the
subsequent two fiscals.
Debt-like features of working capital arrangements could understate
leverage. Kalyan Jewellers procures over 45% of its gold
requirement through gold metal loan (GML). Under the GML, banks
sell physical gold to Kalyan Jewellers with a repayment credit
period of 90-180 days and interest cost of 2.5%-3.75%. While a GML
is usually settled upon the sale of the finished product, Kalyan
Jewellers has the flexibility to repay earlier if gold prices are
in its favor. Therefore, S&P views the GML interest costs as akin
to gold price hedging costs.
S&P said, "We do not include GML into our calculation of the
company's debt and leverage ratios. This is because we view it akin
to a supplier arrangement, especially given the market structure
where gold is mainly sourced from banks. However, we include the
interest associated with GML in our calculation of adjusted
interest expenses and interest coverage ratios."
Kalyan Jewellers also runs a purchase advance scheme (PAS) under
which customers pay monthly installments over a period of up to 11
months. At the end of the period, customers could purchase jewelry
with the pre-paid installments and get a discount, which is
normally equivalent to one month's installment.
S&P said, "While the one-month discount of 8%-10% is akin to
interest-bearing customer advances, we do not treat PAS as debt.
This is because we consider PAS as a sales strategy, rather than a
financing arrangement. Furthermore, Kalyan Jewellers is not liable
to refund the customer at the end of the scheme or if the customer
chooses to opt out of the scheme before the end of the period.
Customers could only choose to purchase a product equivalent to the
value they have paid up to date. The scheme is also a common
offering among gold jewelers in India and taps customers looking to
buy gold jewelry through regular savings. The PAS contributes
around 25% of annual revenue.
"We recognize that both GML and PAS have partial debt-like
features. This is because Kalyan Jewellers will need to seek
alternative funding, likely debt, to fund its working capital, if
the company loses access to either scheme due to regulatory
reasons. While both schemes have been operational for several
years, we note regulators have scrutinized such arrangements in the
past. As of Dec. 31, 2021, Kalyan Jewellers had about INR14 billion
of GML and INR9.5 billion of PAS, against a reported debt balance
of INR26 billion, including lease liabilities. If both the GML and
PAS were treated as debt, the company's FFO-to-debt ratio would
decline to 9%-10% over the next two years, instead of mid-teens in
our base case.
"While we have not made specific debt adjustments, Kalyan
Jewellers' substantial working capital funding needs are reflected
in our negative comparable rating analysis.
"We view Kalyan Jewellers FZE as an integral part of Kalyan
Jewellers. Kalyan Jewellers FZE, a wholly owned subsidiary of
Kalyan Jewellers, is the key vehicle for the group's overseas
operations and expansion plans. They also share a common brand
name, management, and treasury operations. We expect Kalyan
Jewellers FZE to receive strong financial support from Kalyan
Jewellers, if required. While the rating on the proposed notes is
not derived directly from the guarantee, the guarantee is a strong
signal of support, covering up to 135% of the principal. Kalyan
Jewellers will use the proceeds from the proposed notes to
refinance the majority of its short-term debt.
"The final ratings will depend on our receipt and satisfactory
review of all final documentation and final terms of the
transaction."
The preliminary rating is subject to:
-- Successful issuance of Kalyan Jewellers' proposed US$200
million notes.
-- Appropriate hedging in place, which eliminates currency
mismatch risk.
-- Majority of the short-term debt being refinanced through the
proceeds of the proposed notes.
S&P said, "The stable outlook on Kalyan Jewellers reflects our
expectation that the company will strengthen its financial position
while maintaining its competitive position as it grows its
operations over the next two years.
"The stable outlook also reflects our expectation that Kalyan
Jewellers will maintain sufficient liquidity by prudently managing
its working capital and reining in expansionary capex to be
commensurate with operating cash flow.
"We could downgrade Kalyan Jewellers if its operating performance
weakens such that its FFO-to-debt ratio falls sustainably below
10%. A significant deterioration in sales, declining profitability,
or larger-than-expected debt-funded working capital investment and
capex could result in such a scenario.
"We could also lower the rating if the company's liquidity
deteriorates, or refinancing pressure increases from a shortening
debt maturity profile."
A positive rating action would hinge on Kalyan Jewellers' ability
to deleverage such that its FFO-to-debt ratio approaches 20%
sustainably. This would also require the company to establish a
track record of managing its growth while diversifying its funding
channels.
Established in 1993, Kalyan Jewellers is an India-based listed
jewelry retailer with a pan-India footprint. The company focuses on
jewelry design, manufacture and retail. Key product lines include
gold jewelry which accounts for over 75% of revenue. The remainder
is contributed by studded jewelry. Kalyan Jewellers also generates
about 15% of EBITDA from the Middle East.
Kalyan Jewellers is the second-largest player in the organized
jewelry retail market, behind Tanishq, which is owned by Titan Co.
Ltd.
Kalyan Jewellers had 151 showrooms and 853 My Kalyan outlets as of
Dec. 31, 2021. The company is likely to generate about US$1.4
billion in revenue and US$110 million in EBITDA in fiscal 2022.
LOHIA SALES: Voluntary Liquidation Process Case Summary
-------------------------------------------------------
Debtor: Lohia Sales and Services Limited
D-3A Panki Industrial Estate
Kanpur 208022
Uttar Pradesh
Liquidation Commencement Date: March 24, 2022
Court: National Company Law Tribunal, Prayagraj Bench
Insolvency professional: Sudhir Kumar Shukla
Interim Resolution
Professional: Sudhir Kumar Shukla
U-22, Ground Floor, Sangam Place
Civil Lines, Prayagraj
Uttar Pradesh 211001
E-mail: skshukla22@hotmail.com
vol.liq.lssl@gmail.com
Tel: +919452620795
Last date for
submission of claims: April 23, 2022
MADHYA PRADESH: CARE Reaffirms D Rating on INR110.90cr LT Loan
--------------------------------------------------------------
CARE Ratings has reaffirmed ratings on certain bank facilities of
Madhya Pradesh Financial Corporation (MPFC), as:
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long term Bank 110.90 CARE D Reaffirmed
Facilities
Redeemable 100.00 CARE C (CE); Stable; Revised
Non-Convertible from CARE C; Stable
Unsecured
Taxable Bonds
Unsupported Rating - CARE D [Reaffirmed]
Detailed Rationale & Key Rating Drivers for the credit enhanced
debt
The ratings of the bank facilities and instruments of MPFC are
primarily based on the credit enhancement available in the form of
an unconditional and irrevocable guarantees extended by Government
of Madhya Pradesh (GoMP) for ensuring timely debt servicing of
these facilities. The ratings of the instruments are also supported
with an SPM, wherein, the designated account is to be funded 40
days prior to the due dates and the government guarantee is to be
invoked 20 days prior to the due dates, in case of non-funding of
the designated account. However, the aforesaid structure is weak
and not being adhered to with the guarantees not getting invoked.
As per the change in CARE Ratings' default recognition policy for
rating of facilities/ instruments backed by a guarantee, when there
are delays in repayments of such facilities/ instrument, CARE would
recognize default on the said facility/instrument even if the
guarantee is not invoked. Earlier, the default was recognized only
when the payments were not made after the invocation of guarantee.
As there are ongoing delays in servicing its bank obligations, the
ratings for these bank facilities continue to remain at CARE D.
This earlier revision in ratings is only pursuant to change in
analytical approach by CARE Ratings and should not be construed as
deterioration in the credit profile of GoMP.
The ratings of the market instruments factor in the stretched
liquidity position on account of the low collection efficiency from
its borrowers due to state lockdown in light of second wave of
covid and the same leading to hinderance in company's operations.
Company's operations have been shrinking over the past few years
with negligible disbursements in FY21, leading to decline in the
loan book from Rs 555 crore, as on March 31, 2020 to Rs 422 crore
as on March 31, 2021. Low collections, along with shrinking loan
book, impacted MPFC's profitability with the company reporting net
losses in FY20 and FY21.
Detailed Rationale & Key Rating Drivers of GoMP
Madhya Pradesh's economy is estimated to contract by 3.4% in FY21
(1st advanced estimates) as against the positive growth of
9.6% in FY20, reflecting the adverse impact of the COVID-19
pandemic and the subsequent phases of lockdowns on the economy.
The fiscal year 2020-21 has been an unusual year on account of the
pandemic which caused widespread disruptions. The disruption to the
state's economy has pressured its finances in FY21. The economic
rebound in FY22 is expected to improve its financial position.
In FY20, the state's finances weakened considerably and the
COVID-19 pandemic further aggravated the state's financial
constraints in FY21. In FY21, the state has been unable to be in
adherence with most of the fiscal consolidation norms laid out by
the Finance Commission. The state is estimated to see a significant
widening in revenue deficit over FY20 as well as the budget
estimate for FY21. Similarly, its fiscal deficit to Gross State
Domestic Product (GSDP) and debt to GSDP ratio are also above the
stipulated targets and budget estimates. Moreover, the state has
low self- reliance for revenues and its debt has been growing over
the years.
The state has been maintaining a Guarantee Redemption Fund (GRF) to
meet its guarantee obligation. It has also exhibited
prudent liquidity and fiscal management over the years.
Key Rating Drivers of MPFC
The unsupported rating of MPFC is based on its standalone credit
assessment and considers the on-going delays in debt servicing
of term loan principal and interest by MPFC, as informed by the
company. CARE notes that company has been regular in its debt
repayments on the NCD.
Rating Sensitivities for GoMP
Positive Factors - Factors that could lead to positive rating
action/upgrade:
* Higher growth in revenue receipts
* Improvement in self-reliance
* Adherence to the stipulated target for fiscal deficit
* Creation of Consolidated Sinking fund
Negative Factors- Factors that could lead to negative rating
action/downgrade:
* Further deterioration in the state's finances
* Non-adherence to the fiscal responsibility and budget management
(FRBM) targets
Detailed description of the key rating drivers of GoMP
Key Rating Strengths
* Favorable Economic Growth (barring FY21): The economy has been
registering favorable economic growth during FY16 to FY20 with
double digit growth record twice in the last five years. However,
the COVID-19 pandemic has weighed on the economic activities in
FY21 and the economy is estimated to contract by 3.4%.
* Maintenance of GRF to meet contingencies: As per the RBI
bulletin, the state has a GRF with a balance of INR938 crore as on
December 31, 2020. As per the budget documents, the state is likely
to have a balance of INR438 crore as of March 31, 2021.
* Improved ease of doing business ranking: In 2019, Madhya Pradesh
ranked 4th in the Ease of Doing Business ranking, up from 7th rank
in 2017.
Key Rating Weaknesses
* Widening Revenue deficit: The revenue deficit is estimated to
widen significantly to INR21,376 crore in FY21(RE) compared with
INR2,801 crore in FY20. It is important to note that the state has
been in revenue deficit for two consecutive years i.e. FY20 and
FY21 after sustaining a revenue surplus for nine successive years
(till FY19). Fall in revenues and higher revenue expenditure has
led to revenue deficit for the state. The revenue deficit is
budgeted to narrow to INR8,294 crore in FY22(BE).
* Non-adherence to fiscal consolidation roadmap: In FY21, the state
has been unable to be in adherence with most of the fiscal
consolidation norms laid out by the Finance Commission. The state
is estimated to see a significant widening in revenue deficit over
FY20 as well as the budget estimate for FY21. Similarly, its fiscal
deficit to GSDP and debt to GSDP ratio are also above the
stipulated targets and budget estimates. However, the interest to
revenue receipts ratio of the state is below the 15% target.
* Lower degree of self-reliance: The state has low self-reliance.
The own revenue of the state accounted for 46% of the total revenue
receipts in FY21 (RE).
* High debt burden: The outstanding debt of the state has been
increasing over the years registering double digit growth. As of
end FY21 (RE), the outstanding debt stood at INR2.73 lakh crore,
20% higher than FY20 and is budgeted to grow to INR3.22 lakh crore
as of end FY22. The Debt to GSDP ratio of the state government has
risen sharply from 24.3% in FY20 to 28.8% in FY21(RE) and is
budgeted to decline marginally to 28.5% in FY22(BE). However, as
per the FRBM the state has projected debt to GSDP ratio to be
elevated at around 31.5% during FY23 to FY25.
* Absence of consolidated sinking fund: The state does not have a
Consolidated Sinking Fund (CSF). In terms of the guidelines of the
Reserve Bank of India, States are required to contribute to the
Consolidated Sinking Fund, a minimum of 0.5% of their outstanding
liabilities as at the end of the previous year.
Liquidity: Adequate (of GoMP)
The state has not availed liquidity support from the Reserve Bank
of India by way of Ways and Means Advances or overdraft facility so
far in FY21 (based on data up to December 2020), indicative of
their prudent liquidity management practices.
Liquidity position of MPFC is poor as it has liquidity of INR8.72
crore in form of cash of INR0.01 crore, bank balance of INR4.35
crore and FDR of INR4.36 crore as on December 31, 2021
Analytical approach:
Unsupported rating: Standalone
Credit Enhancement (CE) rating: Assessment of the Guarantor, GoMP
CARE has analyzed MPFC's credit profile by considering credit
enhancement provided by unconditional and irrevocable guarantee
deeds/orders extended by GoMP for the rated facilities and bond
issues. However, as per management articulation and interaction
with the lenders, the guarantee given by GoMP has not been invoked
by the lenders, in spite of the delays in servicing the
obligations.
About the Company – GoMP
Madhya Pradesh's economy is estimated to contract by 3.4% in FY21
(1st advanced estimates) as against the positive growth of 9.6% in
FY20, reflecting the adverse impact of the COVID-19 pandemic and
the subsequent phases of lockdowns on the economy. This is the
sharpest contraction recorded for the state economy in a decade.
The services sector (decline of 8.9% in FY21AE) and the industry
sector (-4.9%) has been the worst hit on account of the pandemic
while the agriculture sector has been the lone bright spot,
registering a growth of 4.2%. Madhya Pradesh's economy is fairly
broad based. While the services sector accounts for 40% of state's
GVA, the share of agriculture sector was ~33% and industry had 28%
share in GVA during the last 5 years.
About the Company – MPFC
MPFC was incorporated in 1955 under the State Financial
Corporations Act, 1951. It is a state level financial corporation
providing long term and medium term, fund based and non-fund based
financial assistance to industrial, infrastructural, social sector
organizations in Madhya Pradesh (MP) with focus on small and medium
sized industries. It has its headquarters at Indore – the
industrial hub of MP and has a network of nine branches and seven
business development centres. MPFC is headed by the board of
directors which includes senior bureaucrats, nominees of Small
Industries Development Bank of India (SIDBI), Housing and Urban
Development Corporation (HUDCO) and Life Insurance Corporation
(LIC), financial experts and banking professionals. The performance
of MPFC has gradually weakened with sustained deterioration in
asset quality of its loan portfolio resulting in delay in
recoveries, adversely impacting the liquidity of the corporation
along with worsening negative returns on total assets. Further, the
units financed by MPFC are also facing difficulties due to the
pandemic and MPFC had allowed moratorium of six months to standard
accounts, which had severely affected its collection efficiency.
MAX FLEX: Insolvency Resolution Process Case Summary
----------------------------------------------------
Debtor: Max Flex & Imaging Systems Limited
102, Prime Plaza
JV Patel Compound
Balasaheb Madhurkar Marg
Elphiston (W)
Mumbai 400013
Maharashtra
Insolvency Commencement Date: March 28, 2022
Court: National Company Law Tribunal, Pune Bench
Estimated date of closure of
insolvency resolution process: September 24, 2022
(180 days from commencement)
Insolvency professional: CA Fanendra Harakchand Munot
Interim Resolution
Professional: CA Fanendra Harakchand Munot
6th Floor, Mafatlal House Building
H T Parekh Marg, Backbay Reclamation
Mumbai 400020
E-mail: fhmunot@gmail.com
- and -
5th Floor, Labhade Prestige
Off Karve Road
Deccan Gymkhana
Pune 410004
Mobile: 7378559292
E-mail: cirp.maxflex@gmail.com
Last date for
submission of claims: April 11, 2022
MYTRAH ADARSH: CARE Cuts Rating on INR538.68cr LT Loan to B+
------------------------------------------------------------
CARE Ratings has revised the rating on bank facilities of Mytrah
Adarsh Power Private Limited to Issuer Not Cooperating category.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long Term Bank 538.68 CARE B+; Stable; ISSUER NOT
Facilities COOPERATING; Rating continues
To remain under ISSUER NOT
COOPERATING category and
Revised from CARE BB-; Stable
and moved to ISSUER NOT
COOPERATING category
Detailed Rationale & Key Rating Drivers
CARE Ratings Ltd. has been seeking information from Mytrah Adarsh
Power Private Limited to monitor the rating(s) vide e-mail
communications/letters dated January 6, 2022, March 19, 2022 among
others and numerous phone calls. However, despite CARE's repeated
requests, the company has not provided the requisite information
for monitoring the ratings. 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. The
rating on Mytrah Adarsh Power Private Limited's 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(s).
The ratings have been revised on account of stretched collection
days due to delayed receipt of payments from DISCOM along with
weakening of the credit profile of the parent entity.
Detailed description of the key rating drivers
At the time of last rating on January 21, 2021 the following were
the rating strengths and weaknesses (updated for the information
available from Registrar of Companies):
Key Rating Weaknesses
* Limited record of operation: Mytrah Adarsh has limited track
record at the back of gradual commencement of operations of all six
plants during the period September 2017 to May 2018. The entire
capacity was connected to the grid by end of May 2018 and hence the
company has a generation track record of about two years.
* Moderate Operational performance: The project started operating
at full capacity from the month of June 2018 and hence FY20 was the
first year of full operations. With full-fledged commencement of
operation, the PLF level has witnessed gradual improvement to
19.80% during FY20 and 19.91% during 8MFY21 (as against 17.18%
during FY19). However, it is still lower than PLF at P-90 level (as
per the Energy Yield Assessment report) due to the excess rainfall
and floods in the region which has
impacted the operational performance.
* Counter-party credit risk with delayed payments from Discom:
Mytrah Adarsh has entered into PPAs State Distribution Utilities of
Telangana viz. Southern Power Distribution Company of Telangana
(TSSPDCL) and Northern Power Distribution Company of Telangana
(TSNPDCL), for the entire power off-take for a period of 25 years
at a fixed tariff of about INR5.72/Kwh for all project sites.
However, the DISCOMs have moderate credit profile with losses
reported by them. Hence there exists timely payment risk from them.
The same has been manifested in form of delayed recovery of
payments from Discoms which although has improved in current year
still remains extended with more than 6 months pending recovery.
* Climactic and technological risks: The solar power projects are
subject to risk associated with changes in climatic conditions,
amount of degradation of modules as well as technological risks due
to limited track-record of solar technology in India.
Key Rating Strengths
* Recovery of pending dues from Discoms and regularization of debt
servicing: The company was facing cashflow mismatch due to delays
in receipt of payments from Discoms which had resulted in delays in
debt servicing. However, Mytrah Adarsh recovered a large portion of
pending payments from the State Discoms in the current year which
improved the cashflow position with subsequent regularization of
debt servicing. This apart, the company has created DSRA covering
three months debt servicing (as against lender stipulation of six
months) which also supports the cashflow in medium term. The lender
have permitted time until March 2021 to create remaining DSRA.
* Satisfactory experience of promoters in renewable sector: Mytrah
Adarsh belongs to Mytrah Group, one of the major Independent Power
Producer in the Indian renewable energy segment with about 1.8 GW
capacity of operational wind and solar energy assets. The group is
headed by Mr. Ravi Kailas (Chairman), who has more than two decades
of experience in the industry. While the group has experience of
setting up renewable energy units; it has sizeable presence in
Andhra Pradesh and Telangana State from where the entire group has
been facing payment shortfall from the off-takers.
* Established PV module and inverter suppliers: Mytrah Adarsh is
using the PV modules and inverters from reputed players in the
segment, who are placed among the Tier-1 PV module manufacturers
and are leading manufacturers in the global PV inverter segment.
The company has also entered into Operation and Maintenance (O&M)
Agreement with its holding company. There exists suitable
warranties/guarantee from the module and inverter suppliers.
* Moderate financial performance in FY21: Though total operating
income grew by 19.7% during FY21, the company reported PBILDT
margin of 69.46% during FY21 as against 88.21% during FY20. The
company continues to report PAT level losses due to high interest
and depreciation costs. Nevertheless, Gross cash accruals stand at
INR16.2 crore as on March 31, 2021. Further deterioration in
collection period is observed, with collection days at 277 days in
FY21 against 231 days in FY20.
Industry Risk – Stable
India has an installed renewable capacity of ~105 GW (excluding
large hydro) as on December 31, 2021, comprising solar power of 49
GW, wind power of 40 GW, small hydro of 5 GW and other sources
including biomass of 11 GW. There has been a significant traction
in solar power installations over the last few years and the
cumulative solar power capacity has surpassed the installed wind
power capacity despite its late and slow start. Over the years
renewable energy industry has benefitted on account of Government's
strong policy support, India's large untapped potential, presence
of creditworthy central nodal agencies as intermediary procurers
and high tariff competitiveness. Going forward, with India setting
up an ambitious target of achieving 450 GW renewable capacity by
2030, the regulatory framework is expected to remain supportive.
However, developers are expected to face challenges in the near
term on account of rising cost of modules, turbines and other
ancillary products along with imposition of basic custom duty on
cells and modules which will become effective from April 2022 and
is expected to drive up costs and result in increase in bid tariffs
for new projects. This apart, challenges for acquisition of land
and availability of transmission infrastructure also remains a key
bottleneck. However, the Indian renewable industry continues to be
a preferred investment alternative for both domestic as well as
foreign investors and is expected to post robust growth going
forward.
Liquidity analysis - Stretched: Liquidity is marked by tightly
matched accruals to repayment obligations, highly utilized bank
limits and significant delays in receipt of payments from the
off-taker which had resulted in cashflow mismatch and delays in
debt servicing obligation as on March 31, 2020. The debt servicing
dues for January 2020 has been regularized in April and May 2020.
Thereafter, the company has availed moratorium from March 2020 to
August 2020 as provided by RBI under covid relief and post
moratorium, there has been no delays in debt servicing. The company
has been able to create DSRA in the form of fixed deposits with
Canara Bank which covers 3-4 months of debt servicing.
Mytrah Adarsh Power Private Limited (Mytrah Adarsh), incorporated
in January 2016, is a special purpose vehicle (SPV) promoted by
Mytrah Energy (India) Private Limited. The company was incorporated
to develop and operate solar power capacity aggregating 90 MW at
six different sites viz. Guntipally, Tunki Bollaram, Thungathurthy,
Chegunta, Reddypet, Shanigaram; in various districts across
Telangana. Mytrah Adarsh had achieved Commercial Operation Date
(COD) for all the six plants between September to May 2018, and has
tied up Power Purchase Agreement (PPA) with Telangana State
Distribution Utilities for a period of 25 years.
NEWLINK OVERSEAS: CARE Reaffirms D Rating on INR15cr NCD
--------------------------------------------------------
CARE Ratings has reaffirmed ratings on certain bank facilities of
Newlink Overseas Finance Limited (NOFL), as:
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Non-Convertible 3.40 CARE D Reaffirmed
Debentures-III
Non-Convertible 6.73 CARE D Reaffirmed
Debentures-IV
Non-Convertible 10.17 CARE D Reaffirmed
Debentures-V
Non-Convertible 15.00 CARE D Reaffirmed
Debentures-VII
Fixed Deposits 15.12 CARE D (FD) Reaffirmed
Detailed Rationale & Key Rating Drivers
The ratings assigned to the various debt instruments of NOFL
factors in the instances of delays in debt servicing including
ongoing delays in the repayment of dues to debenture holders and
fixed deposits due to the acute shortfall in cashflow accentuated
by the impact of COVID-19. The ratings also factor in the small
scale of operations, weak asset quality and resultant loss during
FY21, experienced management and long-standing track record of the
company.
Rating Sensitivities
Positive factors - Factors that could, individually or
collectively, lead to positive rating action/upgrade:
* Satisfactory track record of timely servicing of debt obligations
for a period of more than 90 days.
* Significant infusion of Equity Capital
* Improvement in asset quality parameters and resultant improvement
in liquidity position
Detailed description of the key rating drivers
Key Rating Weaknesses
* Liquidity: Poor
* Instances of delays in debt servicing: With the lower collections
during FY21 accentuated by outbreak of COVID-19 the company has
defaulted in the repayment of dues to debenture holders and
deposits. As per the auditor report dated December 17, 2021, NOFL
defaulted in the repayment of dues to debenture holders and
deposits. As per management, delays in debt servicing are ongoing.
Timely infusion of equity and improvement in collections from
overdue customers is highly critical for the company. As on March
31, 2021, the company had cash and bank balance of INR0.90 crore.
* Small scale of operations: Size of operations of NOFL continues
to be small with presence only in Tamil Nadu (6 Branches) and New
Delhi (2 Branches). With the outbreak of Covid-19 and growing NPA,
NOFL completely paused the disbursements during FY21 and as a
result, Loan portfolio de-grew by 4% and stood at INR61.05 crore as
of March 31, 2021 as against INR64.03 crore as of March 31, 2020.
Also, RBI vide its letter dated September 6, 2021, has directed
that the Company is prohibited from expanding its credit and
investment portfolios, other than investments in Government
Securities.
* Weak asset quality: With the significant NPA addition during
FY21, GNPA and NNPA increased significantly to 96.59% and 61.47% as
of March 31, 2021 from 38.30% and 31.14% as of March 31, 2020,
respectively. With higher provisions made during FY21, Provision
coverage Ratio (%) improved from 18.73% as of March 31, 2020 to
36.36% as of March 31, 2021.
* Losses reported during FY21: With the significant increase in the
NPA, interest income has dropped 8% Y-O-Y from INR2.23 crore during
FY20 to INR2.04 crore during FY20. However, with the profit from
the sale of Asset of INR1.47 crore during FY21 (PY: INR0.01 crore),
Total income has grown 33% to INR4.36 crore during FY21 from
INR3.28 crore during FY20. With the decline in interest income, Net
Interest Margin (NIM) remained negative in FY21. Opex to average
total assets remained at 3.05% in FY21 (PY: 3.99%). Credit cost has
increased to 23.67% during FY21 from 3.15% during FY20 because of
the significant slippage during FY21. The company reported net loss
of INR19.09 crore during FY21 as against a loss of INR6.27 crore in
FY20.
* Capital adequacy falling below regulatory requirement: With
significant losses reported during FY21, Networth completely
deteriorated and remained negative as on March 31, 2021.
Subsequently, CAR and Tier I CAR moderated to below 0.00% and 0.00%
as of March 31, 2021 which is lower than the RBI regulatory
requirement of 15.00% and 10.00% respectively.
* Concentrated funding profile: Funding profile of NOFL has
remained concentrated over the years with dependence on NCDs and
FDs. RBI vide their letter dated February 13, 2021 has advised the
company to stop accepting fresh public deposits & renew existing
deposits and that all the existing deposits shall run off till
maturity. The Share of FDs as % of total borrowings stood at 50%
(PY: 47%) and share of NCDs stood at 32% (PY: 33%) as on March 31,
2021. Apart from these, ICDs (7%) and working capital loans from
banks (11%) account for the balance portion of the funding mix as
of March 31, 2021. During the year, the company reclassified some
of its "Deposits from Relatives" in to "Public Deposits". So, the
public deposits held by the company as of March 31, 2021 stood at
INR25.88 crore and NOFL maintained a statutory liquidity reserve in
government securities and bank deposits of INR4.54 crore as of
March 31, 2021 which is 17.55% of the total deposits as against a
RBI regulatory requirement of 15.00%.
Key Rating Strengths
* Long-standing track record of the company: NOFL was incorporated
in January 1991 and has a long-standing track record of around 30
years of operations. During this period, the company has
established itself in a niche market and has a good customer base
in Tamil Nadu and New Delhi.
* Experienced management: Post the demise of Mr. A. Namasivayam
(Former MD) in December 2018, there were many changes in the board
of directors and currently the board comprises of 5 directors as of
March 31, 2021 namely Mr Rm.Subbiah, Mr O.P.Garg, Mr U.P.Prakasham,
Mrs Denise Marcelle Mollex Panjwani and Mrs S.Deivanai. Directors
monitor the day to day operations of the company ably supported by
a small team of professionals with experience in the banking
sector. During H1FY21, Mr Rm.Subbiah, resigned from the
Directorship of the Company with effect from July 31, 2021.
Outlook and prospects
The outlook for NBFCs and HFCs has turned negative due to Covid-19
outbreak. The sector which grappled with liability side disruptions
could see another wave of challenges, this time in the form of
asset quality. Amidst these, funding challenges could mount again,
as banks become more selective in extending credit. While asset
quality of NBFCs has witnessed moderation in FY21, the impact of
COVID-19 on the asset quality remains to be seen.
* Impact of Covid-19: Asset quality has significantly deteriorated
before Covid-19 and with the impact of Covid-19, asset quality and
profitability parameters impacted significantly.
NOFL is a Chennai-based deposit taking Non-Banking Finance Company
(NBFC) registered with the Reserve Bank of India (RBI). It was
promoted in January 1991 by retired bankers in Chennai and operates
through a network of eight branches (six in Tamil Nadu
and two in New Delhi).
The company is engaged in hypothecation loans, hire purchase
financing and short-term lending. The company extends hypothecation
loans/hire purchase finance for industrial equipment and vehicles
(heavy commercial vehicles, cars and two wheelers).
The short-term lending is generally secured by deposits or property
and third-party guarantee. The client profile of NOFL mainly
consists of small and medium enterprises including educational
trusts.
NOFL has set up five windmills in rural areas of Tamil Nadu as a
tax planning measure. The company earned INR0.78 crore during FY21
(PY: INR0.71 crore) as revenue by sale of power generated from
these wind mills to the Tamil Nadu state utility.
NUPOWER RENEWABLES: CARE Reaffirms D Rating on INR169.49cr Loan
---------------------------------------------------------------
CARE Ratings has reaffirmed ratings on certain bank facilities of
NuPower Renewables Private Limited (NRPL), as:
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long Term Bank
Facilities 169.49 CARE D Reaffirmed
Detailed Rationale & Key Rating Drivers
The rating of bank facility of NRPL reaffirmed on account of delay
in serving debt obligations.
Rating Sensitivities
Positive Factors -
* Timely servicing of debt obligations (i.e., principal and
interest) for minimum continuous 3 months
* Improvement in operational performance of all operational
capacities on sustained manner
* Positive outcome in favour of the company with respect to the
pending investigations
Detailed description of the key rating drivers
Key Rating Weaknesses
* Delay in debt servicing: NRPL reported delay in serving of debt
obligations (i.e., principal instalment) and interest payment on
account of poor liquidity position due to delay in realization of
receivables from counter party (i.e. Maharashtra State Electricity
Distribution Company Limited).
* Ongoing investigations by Enforcement Directorate, Central Bureau
of Investigation and Income Tax Department: NRPL is promoted by Mr.
Deepak Kochhar & Associates. There have been investments by a
private equity fund namely, Accion Diversified Strategies Fund,
SPC, Singapore through its SPV DH Renewables Holding Limited
(DHRH). In recent past an enquiry was initiated by Central Bureau
of Investigation (CBI) into the alleged links of the Videocon group
with ICICI Bank and also into equity infused into NuPower
Renewables. Further, as per information in public domain, Income
Tax Department had also initiated an enquiry on funding by an
overseas Fund viz. Accion Diversified Strategies Fund, SPC,
Singapore through its SPV DH Renewables Holding Limited. These
allegations if proved, might impact the management stability thus
translating into operations and financial implications for the
NuPower group of companies. The assets of NRPL group had been
provisionally and partially attached by ED. Subsequently, the
Adjudicating Authority (AA) gave an order dated 6th November 2020
that the Provisional Attachment Order is not confirmed, and the
Original Complaint (OC) is rejected. The ED has subsequently filed
an appeal in the appellate tribunal against the order of the AA.
The day-to-day operations of the company are managed by a team of
personnel headed by Mr. Deepak Kochhar, Director.
Liquidity: Poor
NRPL has free cash and cash equivalent of INR0.1 crore as on Dec.
31, 2021. Company continues default in its repayment obligation.
NuPower Renewables Private Limited (NRPL) incorporated on December
24, 2008, is the promoter company of NuPower Group. The major
shareholders of NRPL are DH Renewables Holding Limited (holds
54.99% stake), Pinnacle Energy (Promoter owned Trust, holds 33.17%
stake) and Supreme Energy Private Limited (holds 10.10% stake). The
company is engaged in generation of power through wind with
operational capacity of 43.10 MW as on December 31, 2021 (2.05 MW
is yet to be commissioned). Apart from NRPL, the group also has
operational capacities in its subsidiaries i.e. Echanda Urja
Private Limited (100.50 MW in Tamil Nadu) and NuPower Wind Farms
Limited (34.25 MW in Karnataka).
PAITHAN MEGA: CARE Reaffirms D Rating on INR28.87cr LT Loan
-----------------------------------------------------------
CARE Ratings has reaffirmed ratings on certain bank facilities of
Paithan Mega Food Park Private Limited (PMFPL), as:
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long Term Bank
Facilities 28.87 CARE D Reaffirmed
Detailed Rationale & Key Rating Drivers
The reaffirmation of the rating to the long-term bank facilities of
PMFPL factors in the delays in debt servicing.
Rating Sensitivities
Positive Factors - Factors that could lead to positive rating
action/upgrade:
* Improvement in liquidity profile of the company leading to timely
repayment of debt obligations.
Detailed description of the key rating drivers
Key Rating Weaknesses
* Delays in debt servicing: There are delays in repayment of debt
obligation.
Liquidity: Poor
The liquidity position of the company is poor as reflected by the
delay in debt servicing of debt obligation along with high
utilization of working capital limit.
PMFPPL is an SPV formed in 2011 for setting up a mega food park
under the 11th five-year plan as approved by Ministry of Food
Processing of India (MOFPI). The company was formed as an SPV of
Nath Group. The current shareholding of PMFPPL is Nath Bio-Genes
(India) Limited (NBGIL- holding 19.98% stake as on March 31, 2021),
Agri Tech India Limited (ATIL - holding 49.20% as of March 31,
2021) and balance by Nature Tech Foods Private Limited (NTFPL-
holding 25.60% as on March 31, 2021) and others.
PAS TRADING: CARE Lowers Rating on INR19.50cr LT/ST Loan to D
-------------------------------------------------------------
CARE Ratings has revised the ratings on certain bank facilities of
PAS Trading House (PAS), as:
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long Term Bank 11.94 CARE D; ISSUER NOT COOPERATING
Facilities Revised from CARE B; Stable
Long Term/ 19.50 CARE D/CARE D Revised from
Short Term CARE B; Stable/CARE A4
Bank Facilities
Detailed Rationale & Key Rating Drivers
The revision in the rating assigned to the bank facilities of PAS
is due to on-going delay in servicing of debt obligation due to
stretched liquidity position
Rating Sensitivities
Positive Factors - Factors that could lead to positive rating
action/upgrade:
* The entity's ability to establish a track record of timely
servicing of debt obligations with improvement in liquidity
position.
Detailed description of the key rating drivers
Rating
Key Rating Weaknesses
* On-doing delays in debt servicing: There are on-going delays in
debt servicing in the principal repayment of the term loan facility
and dropline overdraft limit since the month of February 2022 due
to stress on liquidity.
Liquidity: Poor
Liquidity is poor marked by delays in debt servicing (term loan and
dropline limit) due to liquidity issues faced by the entity
PAS Trading House (PAS) was established in 2015 as a partnership
firm by Mr. Sunil Khanna, Mrs. Alka Khanna and Mr. Puranjay Khanna.
PAS Trading House draws its history from the establishment of SGK
Trading House Private Limited (engaged in trading of paper), where
Mr. Sunil Khanna was a partner along with Mr. Gopal Khaitan. On
mutually winding up of this business wef December 31, 2014, Mr.
Sunil Khanna, floated a new partnership firm comprising of his
family members and decided to continue with existing business of
SGKTH in the name of PAS Trading House. PAS Trading House is
engaged in trading of various grades of paper such as coated wood
free paper, printing paper, label paper, speciality paper,
packaging paper, etc. which are 100% domestically supplied to the
local printers, publishers, label manufacturers, packaging
industries, traders & wholesalers which are majorly based in
Maharshtra, Madhya Pradesh and Gujarat and it finds its application
in pharma industry, FMCG goods industry, barcode industry,
packaging industry and beer manufacturing industry.
POKAR AGRO: Voluntary Liquidation Process Case Summary
------------------------------------------------------
Debtor: Pokar Agro Private Limited
Char 24 GB Sri Bijay Nagar
Sriganganagar 335704
Rajasthan
Liquidation Commencement Date: March 28, 2022
Court: National Company Law Tribunal, Jaipur Bench
Insolvency professional: Mr. Sandeep Kumar Jain
Interim Resolution
Professional: Mr. Sandeep Kumar Jain
24 Ka 1, Pankaj Singhvi Marg
Jyoti Nagar, Jaipur 302005
Rajasthan
E-mail: cssandeep@armsandassociates.com
Tel: +919828050920
Last date for
submission of claims: April 27, 2022
RELIANCE MEDIAWORKS: CARE Lowers Rating on INR638.20cr NCD to D
---------------------------------------------------------------
CARE Ratings has revised the ratings on certain bank facilities of
Reliance Mediaworks Financial Services Private Limited (RMFSPL),
as:
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Non Convertible 638.20 CARE D; ISSUER NOT COOPERATING;
Debentures Rating continues to remain
Under ISSUER NOT COOPERATING
Category and Revised from
CARE C; Negative
Detailed Rationale & Key Rating Drivers
The rating revision takes into account that RMFSPL has defaulted in
servicing of principal/interest on its capital market instruments,
as per the feedback from the debenture trustee.
Further, the rating continues to remain under Issuer Not
Cooperating category, despite CARE's repeated requests, the company
has not provided the requisite information for monitoring the
ratings. CARE has been seeking information from Reliance Mediaworks
Financial Services Private Limited (RMFSPL) to monitor the
rating(s) vide e-mail communications/letters dated February 28,
2022, February 18, 2022, February 08, 2021, and numerous phone
calls. 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. Further, RMFSPL has not paid the surveillance fees for the
rating exercise as agreed to in its Rating Agreement.
The rating factors in negative net worth, continue reporting loss
over the years and the company has also breached the several
covenants on the instruments rated by CARE. Further, on December 2,
2021, RBI filed applications for initiation of corporate insolvency
resolution process (CIRP) against its promoter entity Reliance
Capital Limited. Pursuant to order dated December 6, 2021, of the
NCLT, CIRP has been initiated as per the provisions of the
Insolvency and Bankruptcy Code, 2016. The estimated date of closure
of insolvency resolution process is June 4, 2022.
Users of this rating (including investors, lenders, and the public
at large) are hence requested to exercise caution while using the
above rating(s).
Detailed description of the key rating drivers
Key Rating Weaknesses
* Default in servicing of debt obligations: The Debenture Trustee
for the NCD issued by RMFSPL has informed CARE (via its email dated
March 29, 2022) that RMFSPL has defaulted on its debt obligations.
Also, the Debenture Trustee informed that the matter is in process
at the Bombay High Court and the Supreme Court and there is no
information regarding the interest payment.
* Weak earning profile: RMFSPL started its operation in the year
2017. Since then, the company has been suffering losses due to very
low business activity. Company reported a loss in FY21 to INR619.14
crore against INR80.25 crores from FY20.
* Weak solvency profile: RMFSPL's has a negative tangible net worth
at INR699.12 crore as of March 31, 2021 as compared to negative net
worth of INR79.99 crore as of March 31, 2020. As per December 31,
2021, results, DT invoked the pledge on equity shares of prime
focus limited (PFL) on November 28, 2019 and March 17, 2021 of
INR7.33 crores and 3.16 crores respectively. Accordingly, PFL
ceased to be an associate company w.e.f. March 17, 2021. Debenture
trustee sold the entire invoked equity shares of PFL under open
offer at an offer price of INR44.15 per equity share for a total
value of INR463.30 crores. The Debenture trustee vide their letter
dated May 26, 2021 intimated the company on adjustment of above
consideration towards part repayment of NCD's after adjusting
interest due on NCD's penal interest and cost expenses.
Liquidity: Poor
As of March 31, 2021, cash and cash equivalents stood at INR0.21
crore as against INR0.89 crore as on March 31, 2020.
Reliance Mediaworks Financial Services Private Limited (RMFSPL) was
incorporated of March 10, 2017 which is engaged in to carry on the
business of an investment company and invest, buy, sell, transfer
deal in and dispose of any shares, stocks, debentures, debenture
stock bonds, mortgages, obligations and securities of any kind
issued or guaranteed by any company, corporation or undertaking of
whatever nature whether incorporated or otherwise; and where so
ever constituted or carrying on business of immovable property and
rights directly or indirectly connected therewith and or bullion,
including gold, silver and other precious metals and/ or precious
stones such as diamonds, rubies and/or any other asset.
SABER PAPER: ED Tracks Ludhiana Business Family's Swiss Stash
-------------------------------------------------------------
The Times of India reports that the Enforcement Directorate has
claimed that a prominent business family of Ludhiana and its
companies including Saber Paper Boards Private Limited, Ludhiana
(SPBPL) have allegedly been involved in mega financial transactions
in Switzerland along with acquiring assets worth several hundred
crores in that country in violation of the Foreign Exchange
Management Act (FEMA).
On the other hand, the companies owned by the family in Ludhiana
and other places in India have taken loans worth more than Rs400
crore from Indian banks, which have filed insolvency proceedings
with the National Company Law Tribunal (NCLT) against these
companies, TOI says.
TOI relates that the ED shared these developments official in a
statement issued by its headquarters on April 1. The agency also
disclosed that the Soin family had acquired assets in Cyprus as
well and look-out circulars (LOC) had been issued against some of
the members of this family. The ED had raided properties linked to
Soin family of Ludhiana recently, the report says.
According to TOI, the agency said, "ED has conducted search
operations on March 30 in Punjab and Himachal Pradesh for
investigating the matter of, prima facie, violation of the
provisions of Section 4 of the Foreign Exchange Management Act
(FEMA) for acquiring, holding, owning, possessing and transferring
foreign exchange, foreign security or any immovable properties
situated outside India. In total, seven company premises had been
searched."
"During the search, many incriminating documents in the form of
loose papers and property documents revealing financial
transactions between the persons resident in India/the business
entities owned/controlled by them and the various business entities
in India and Switzerland were recovered and seized. Investigation
was initiated based on a reference stating that LoCs had been
issued against Dinesh Soin, Abhishek Soin and others of Saber
Papers Limited, Ludhiana (SPL). Enquiries were conducted by ED,
which revealed that Dinesh Soin, Abhishek Soin and other members of
the Soin family were the shareholders, directors of SPL and Saber
Paper Boards Private Limited, Ludhiana (SPBPL)"
TOI relates that the ED further said, "Further inquiry confirmed
that certain wholly-owned subsidiary and joint venture entities
were incorporated in Cyprus and Switzerland by the said persons and
mandatory reporting required to be filed as per the FEMA
provisions, had not been made for considerable number of years."
It came out that Dinesh Soin and Abhishek Soin had invested Rs 9.7
crore in foreign entities and later, had apportioned the assets and
liabilities among those entities, hencce more that Rs 120 crore
worth of assets had accreted in the name of those companies in
Switzerland. The Soins had remitted only Rs 9.7 crore through
banking channels, reinforcing the suspicions that these funds had
been transferred from India."
SPBPL (formerly, Jai Durga Paper Mills Pvt Ltd), incorporated in
1996 by Satendra Gupta, was acquired by Mr. Dinesh Soin and his
family members in 2004. The company manufactures packaging paper
(kraft paper), corrugated boxes, and has captive power generation
capacity of 2 megawatt. The company has installed capacity of 125
tonnes per day for Kraft paper and 110 tpd of capacity for
Corrugated boxes. The unit is located in Ludhiana (Punjab).
SAEL RG1: Fitch Gives 'BB(EXP)' Rating to Proposed USD Sec. Notes
-----------------------------------------------------------------
Fitch Ratings has assigned SAEL RG1's proposed US-dollar senior
secured notes due 2029 an expected rating of 'BB(EXP)'. The Outlook
is Stable. SAEL RG1 is a restricted group of solar and biomass
projects owned by India-based SAEL Limited.
The final rating is contingent upon the proposed reorganisation of
the group and the receipt of final bond documents conforming to
information already received.
RATING RATIONALE
The expected rating reflects the credit strengths and weaknesses of
a restructured SAEL Limited and five of its operating subsidiaries,
which contain 13 solar and biomass assets with a total capacity of
281MW as well as a warehousing business. SAEL's commodities
business, module assembly plant and other solar and biomass
projects will be removed from SAEL Limited and injected into other
unrestricted subsidiaries. All the unrestricted businesses and
subsidiaries will not have any recourse to SAEL, but will have
direct recourse to the new ultimate parent.
The expected rating is supported by limited volume and price risk
as well as low fuel-supply risk for biomass projects. The
restricted group will repay about 52% of the total bond value
during the proposed bond's tenor. However, the majority of
repayments are planned through mandatory cash sweeps and not actual
amortisation. The expected rating is constrained by a high reliance
on mandatory cash sweeps along with a low project-life cover ratio
of 1.17x. In addition, the four biomass projects contribute almost
half of the cash operating profit. Fitch's rating case results in
an average debt service coverage ratio (DSCR) of 1.61x over the
proposed bond's tenor.
KEY RATING DRIVERS
Tight Forecast Spread, Limited Record, No Take-or-Pay - Revenue
Risk (Volume): Midrange
The energy yield forecast produced by a third-party expert for each
solar asset indicates an overall one-year P90/P50 spread of about
4%, which Fitch assesses as 'Stronger'. However, Fitch's overall
assessment is constrained by the limited record of most of the
solar assets in the portfolio, with two projects with a total
capacity of 47MW planned to commence operations in a couple of
months. Fitch expects limited curtailment risk for the solar assets
given the must-run legal status.
The technology supplier for the biomass projects has guaranteed
availability of 91.3%. However, unlike other thermal projects,
there are no take-or-pay arrangements for SAEL's biomass assets.
Nevertheless, Fitch expects limited curtailment risk, as these
assets have a must-run status, operate as base load, support the
renewable-power purchase obligations of distribution companies and
help contain pollution. Combined, Fitch assesses overall volume
risk as 'Midrange'.
Fixed Long-Term Prices for Most Contracts - Revenue Risk (Price):
Midrange
Revenue for most of the solar portfolio is earned under long-term,
fixed-price power purchase agreements (PPAs). SAEL receives a fixed
price for Project 1, which represents 50MW of its 221MW solar
capacity, until March 2030, after which remuneration will be based
on the average power-purchase cost of its counterparty. Tariffs for
the three biomass projects are fixed for 13-15 years from
commercial operations and will thereafter be reassessed by the
respective state regulator for the balance useful life of the
assets. Fitch assesses overall price risk as 'Midrange'.
Reasonable Supply, Short-Term Contracts - Supply Risk: Midrange
The assets are located in paddy-rich states of India where the
majority of paddy straw is burnt in the fields. SAEL RG1's supply
is de-risked from the underlying crop and the company has an
established supply chain, which is a significant barrier to entry
for competitors. The supply contracts offer fixed prices with
certain annual escalation, but the tenor is short. SAEL RG1's fuel
supplier is one of many small traders. There are no delivery
liquidated damages in the contracts or reserves to cover PPA
deductions or operating costs. Hence, Fitch's overall assessment is
constrained to 'Midrange'.
Proven Technology, Affiliated Contractor, Invalidated cost -
Operation Risk: Midrange
SAEL RG1's total capacity of 281MW comprises 78% (221MW) solar
projects and 22% (60MW) biomass power assets. Fitch considers the
technology deployed in these projects as proven. Solar modules and
equipment for biomass projects are sourced from internationally
well-known suppliers. Operation and maintenance (O&M) is carried
out by an affiliate company under longer term fixed-price
contracts. However, Fitch's assessment is constrained to
'Midrange', as the operating cost forecast is not validated by an
independent advisor and there is no reserving mechanism for
maintenance costs.
Partially Amortising Debt, Refinancing Risk - Debt Structure:
Midrange
The proposed bond will be jointly and severally guaranteed by SAEL
and its five other operating subsidiaries. The co-issuers will use
the proposed bond proceeds to refinance existing debt and to fund
pending capex within the restricted group. About 52% of the
proposed bond will be repaid during its tenor through a mix of
mandatory cash sweeps (39% of total repayment during the bond
tenor) and scheduled amortisation (13%).
Bond holders will benefit from protective structural features,
including complete lockup of operating cash and restrictions on
permitted indebtedness. The restricted group will also maintain a
six-month debt service reserve account. However, there will not be
any maintenance reserve account. Refinancing risk is mitigated by
partial repayment during the proposed bond's tenor, the remaining
tenor of the PPAs and the group's access to domestic banks. The
issuer plans to substantially hedge foreign-exchange exposure.
PEER GROUP
SAEL RG1 can be compared with Clean Renewable Power (Mauritius)
Pte. Ltd (CRP, senior secured: BB-/Stable) and India Cleantech
Energy (senior secured: BB-/Stable, underlying credit profile:
bb).
The CRP restricted group of solar and wind assets has a total
capacity of 505MW; 54% solar and 46% wind. It also has stronger
counterparty exposure than SAEL, with 46% of capacity contracted
with sovereign-owned entities, against SAEL RG1's 7%. CRP will also
repay about 30% of its total debt during the bond tenor, with 27%
through cash sweeps and the balance through actual amortisation,
but SAEL RG1's credit assessment is more sensitive as it has a
greater reliance on cash sweep payments. Nevertheless, SAEL RG1's
strong rating case DSCR of 1.61x, versus CRP's 1.26x, counteracts
these weaknesses and justifies a notch higher rating.
India Cleantech Energy's restricted group, Acme RG1, comprises pure
solar assets with total capacity of 450MW. Acme RG1 has stronger
resource and superior counterparty exposure, with 55% of capacity
contracted with sovereign-owned entities. Acme RG1 will repay about
26% of its total debt during the bond tenor, with 19% coming from
cash sweeps and the balance through actual amortisation. SAEL RG1's
credit assessment is more sensitive to cash sweep payments due to
its greater reliance on this form of repayment. Combined, Fitch
rates SAEL RG1 at the same level as Acme RG1's underlying credit
profile, despite its stronger rating case DSCR of 1.61x versus Acme
RG1's 1.32x. Acme is rated a notch lower than its underlying credit
profile to reflect risk of orphan SPV issuance.
RATING SENSITIVITIES
Factors that could, individually or collectively, lead to negative
rating action/downgrade:
-- Average annual rating case DSCR persistently below 1.56x;
-- Unfavourable regulatory outcome on tariff determination of
biomass projects.
Factor that could, individually or collectively, lead to positive
rating action/upgrade:
-- Average annual rating case DSCR persistently above 1.67x.
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.
TRANSACTION SUMMARY
As part of the group's restructuring, agri business, module
assembly plant and certain power projects will move out of SAEL and
will be housed in separate SPVs. SAEL will be left with eight power
projects -projects 1, 2, 3, 4, 9, 11, 12 and 16 - and a warehousing
business. A new holding company will be created and will own the
majority of SAEL. The promoter's ownership will be transferred to
the new holding company through share swaps. All businesses outside
of SAEL, aside from the constituents of the proposed restricted
group, will have direct recourse to only the new holding company,
not SAEL.
Proceeds of the proposed US-dollar notes will be used by the
co-issuers to repay existing debt, including the prepayment of
penalties to existing lenders, for capital expenditure, to extend
inter-company loans to group entities and for other uses as
permitted by the central bank's guidelines for external commercial
borrowings.
Cash equivalent to at least 1.1x of the remaining estimated project
cost will be trapped upfront from the proposed bond proceeds in a
designated account for the construction and capital expenditure of
two solar and one waste-to-energy projects. The balance will be
released after the projects achieve commercial operations and
receive the first payment from offtakers.
FINANCIAL ANALYSIS
Fitch's base case assumes P50 generation, a 5% production haircut
and 0.7% annual degradation for solar assets. For the biomass
projects, Fitch assumes a heat rate varying from 1.1 tonnes/MWh to
1.4 tonnes/MWh and a load factor in around 80%-88%. Fitch's O&M
cost assumption is in line with the company.
Fitch's rating case assumes 1-year P90 generation, a 5% production
haircut and 0.7% annual degradation for solar assets. For the
various biomass projects, Fitch assumes a heat rate varying from
1.2 tonnes/MWh to 1.5 tonnes/MWh and a load factor that is 5% lower
than the base case. Fitch's O&M cost assumption is 10% higher for
the solar assets and 20% higher for the biomass projects.
In both cases, Fitch assumes contracted tariffs for projects with
long-term PPAs. For Project 1, Fitch assumes a tariff of INR3/kWh
once the PPA expires. For the biomass projects, Fitch assumes a 50%
decline in the tariff once the tariff period expires. Fitch also
assumes that the outstanding US-dollar bond at maturity will be
refinanced by new debt that will amortise across the remaining PPA
terms or the projects' useful lives, whichever is longer. Fitch's
refinance rate assumption is around 11%. Fitch focuses on the
conservative average annual DSCR, be it over the bond tenor or
during the refinancing period. The reliance on cash sweeps for
repayments is credit negative compared with full amortisation, as
balloon repayment on maturity may vary.
Fitch's average DSCR in the base case is 1.81x during the bond
tenor. Fitch's rating case results in an average annual DSCR of
1.61x during the bond tenor.
SECURITY
The primary obligation of each co-issuer in respect of the proposed
US-dollar notes will be secured by:
-- Pari-passu charge over the immovable, movable and current
assets and receivables of the co-issuers, except land
attributable to agriculture and the warehousing business;
-- assignment of or charge over rights under the project
documents and insurance policies of the co-issuers;
-- first ranking pledge of 100% of shares of each co-issuer;
-- exclusive charge over the cash trap account, which will be
created to park the payment required for pending capex, and
the debt service reserve account.
ESG CONSIDERATIONS
Unless otherwise disclosed in this section, the highest level of
ESG credit relevance is a score of '3'. This means ESG issues are
credit-neutral or have only a minimal credit impact on the entity,
either due to their nature or the way in which they are being
managed by the entity.
SHRIRAM EPC: CARE Moves D Debt Ratings to Not Cooperating
---------------------------------------------------------
CARE Ratings has migrated the ratings on certain bank facilities of
Shriram EPC Limited (SEPC), as:
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long Term Bank 561.98 CARE D; ISSUER NOT COOPERATING
Facilities Rating moved to ISSUER NOT
COOPERATING category
Long Term/ 6.36 CARE D/CARE D; ISSUER NOT
Short Term COOPERATING; Rating moved to
Bank Facilities ISSUER NOT COOPERATING
Category
Short Term 899.52 CARE D; ISSUER NOT COOPERATING
Bank Facilities Rating moved to ISSUER NOT
COOPERATING category
Detailed Rationale & Key Rating Drivers
CARE Ratings Ltd. has been seeking information from SEPC to monitor
the rating vide e-mail communications dated December 27, 2022,
February 5, 2022 and February 21, 2022 among others and numerous
phone calls. However, despite CARE's repeated requests, the company
has not provided the requisite information for monitoring the
ratings. 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. Further, SEPC has not paid
the surveillance fees for the rating exercise as agreed to in its
Rating Agreement. The rating on SEPC's bank facilities will now be
denoted as CARE D/CARE D; 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 ratings.
Detailed description of the key rating drivers
At the time of last rating on April 5, 2021 the following were the
rating strengths and weaknesses (updated for the information
available from stock exchange):
Key Rating Weaknesses
* Delays in debt servicing with tight liquidity position: Being an
EPC contractor, the operations of Shriram EPC Limited (SEPCL) are
working capital intensive with the project cycle generally ranging
from six months to three years. The higher receivables position and
delays associated with projects have increased the pressure on the
cash flow position of the company. The resultant tight liquidity
position of the company has led to ongoing delays in servicing of
term loan and working capital facilities. For FY21, total income of
SEPCL declined 23% y-o-y. The company reported net loss of INR183
crore in FY21 as against loss of INR81 crore in FY20.
Liquidity: Poor
Poor liquidity marked by lower accruals when compared to repayment
obligations, elongated working capital cycle, fully utilized bank
limits and modest cash balance. The company had cash and bank
balance of INR2.65 crore as on March 31, 2021. Working capital
cycle for FY21 remains stretched at 162 days (PY: 116 days) due to
high collection period. During FY21, collection period stood at 358
days (PY: 317 days). As part of COVID-19 relief package announced
by RBI, the company had availed moratorium on its debt obligations
between March-August 2020 from all lenders.
Chennai based Shriram EPC Limited (SEPC) was incorporated in June
2000, after merging companies engaged in similar businesses,
consolidating their operations. Initially, setup as an EPC
contractor to carry out the construction works of associate
entities within the group, SEPC has been able to establish its
presence in undertaking jobs for external parties and
government/quasi government entities. SEPC specializes in executing
EPC contracts, providing integrated solutions encompassing design,
engineering, procurement, construction and project management
services. The company's services are primarily spread across
municipal services, process & metallurgy, power and mineral
processing segments.
SUN-AMP SOLAR: Voluntary Liquidation Process Case Summary
---------------------------------------------------------
Debtor: Sun-Amp Solar India Private Limited
11, Ground Floor, Community Centre
Saket, Delhi 110017
Liquidation Commencement Date: March 28, 2022
Court: National Company Law Tribunal, New Delhi Bench
Insolvency professional: Gunjan Mittal
Interim Resolution
Professional: Gunjan Mittal
A-25A, LGF
Lajpat Nagar-II
New Delhi 110024
Tel: 01145552681
Mobile: 9868476717
E-mail: ip.gunjanmittal@gmail.com
sunampliquidator@gmail.com
Last date for
submission of claims: April 27, 2022
SUPER MAX: CARE Lowers Rating on INR25cr LT Loan to B
-----------------------------------------------------
CARE Ratings has revised the ratings on certain bank facilities of
Super Max Affordable Housing Private Limited (SMPL), as:
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long Term Bank 25.00 CARE B; Stable; ISSUER NOT
Facilities COOPERATING; Revised from
CARE B+; Stable and moved
to ISSUER NOT COOPERATING
category
Detailed Rationale & Key Rating Drivers
CARE Ratings Ltd. has been seeking information from SMPL to monitor
the rating(s) vide e-mail communications March 5, 2022, January 24,
2022, January 4, 2022, etc among others and numerous phone calls.
However, despite CARE's repeated requests, the company has not
provided the requisite information for monitoring the ratings. 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. The ratings of Super Max Affordable
Housing Private Limited (SMPL) 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(s).
The rating has been revised on account of non-availability of
requisite information due to non-cooperation by Super Max
Affordable Housing Private Limited (SMPL) with CARE Ratings Ltd.'s
efforts to undertake a review of the rating outstanding. CARE
Ratings Ltd. views information availability risk as a key factor in
its assessment of credit risk. The Rating continues to be
constrained by risk associated with high dependence on customer
advances for project execution, moderate financial risk profile,
cyclicality and seasonality associated with real estate industry
and exposure to local demand-supply dynamic. However, it derives
comfort from the launch of the project and satisfactory sales
momentum and customer collections along with the satisfactory
project execution. Further, the rating continues to draw comfort
from experienced promoters.
Detailed description of the key rating drivers
At the time of last rating on April 5, 2021, the following were the
rating strengths and weaknesses:
(Updated for the information available from Registrar of
Companies)
Key Rating Weaknesses
* High dependence on customer advances for project execution:
Currently, the company is developing one project namely; "Supermax
- The New Town" in which 70% (INR106.70 crore) of total project
cost is to be met through customer advances which has to be
realized from the project. However, as on December 31, 2020,
company has sold the saleable area for total value of INR72.48
crore and has realized INR40.14 crore and has balance receivable of
INR32.34 crore. However, considering only ~49% of the total
construction cost incurred till December 31, 2021, the company has
high reliance on customer advances and further sales of the
completed area for project completion and servicing of its debt
obligations. However, CARE cannot comment on the same as updated
information is not available due to non-cooperation by SMPL.
* Moderate financial risk profile: SMPL has a limited track record
with only one ongoing project i.e., project 'Supermax – The
New Town' led company operating at a small scale with a total
operational income of INR14.46 crore in FY21 (PY: INR10.52crore).
Further, the debt level also remained high as marked by overall
gearing ratio which stood at 4.76x as on March 31, 2021, as against
6.68x as on March 31, 2020.
* Cyclicality and seasonality associated with real estate industry
and exposure to local demand-supply dynamic: The company is exposed
to the cyclicality associated with real estate sector which has
direct linkage with the general macroeconomic scenario, interest
rates and level of disposable income available with individuals. In
case of real estate companies, the profitability is highly
dependent on property markets. This exposes these companies to the
vagaries of property markets. A high interest rate scenario could
discourage the consumers from borrowing to finance the real estate
purchases and may depress the real estate market. Furthermore,
SMPL's business risk profile is constrained by its exposure to any
adverse changes in local laws. Also, the sales of real estate
projects are dependent on dynamics of local demand supply of real
estate in that area and state government regulations.
Key Rating Strength
* Experienced promoters: Super Max Affordable Housing Private
Limited is currently being managed by Mr. Jawahar Lal, Mr. Anil
Kumar Garg, Mr. Ankit Kumar and Mr. Deepak Goel. Mr. Jawahar Lal
(Chairman) is graduate and has an experience of around two decades
in the real estate industry through his association with this
entity and other associate concern engaged in real estate
development and other family run business. He is ably supported by
other directors of the company namely; Mr. Anil Kumar Garg, Mr.
Ankit Kumar and Mr. Deepak Goel who holds experience of more than
one and half decade through their association with this entity and
other family run business.
* Satisfactory sales momentum and customer collections from the
project: The sales momentum and collections: remained satisfactory
since the launch of the project. The project "Supermax - The New
Town" has a total saleable area of 4.28 lsf, which includes
residential area of 4.21 lsf and commercial area of 0.07 lsf. Out
of which the company has collectively sold 1.83 lsf of area, that
is 43% of the total saleable area for sale value of ~INR72.48 crore
till December 31, 2020. SMPL has realized ~INR40.14 crore leading
to collection efficiency of ~55%. Further, the company in the past
1 year ended December, 2020 has collected ~INR13.06 crore. However,
CARE cannot comment on the same as updated information is not
available due to non-cooperation by SMPL.
* Satisfactory project execution: As on December 31, 2020, company
has incurred INR76.02 crore out of the total project cost of
INR151.89 crore i.e., ~50% of the total project cost. Further, out
of the construction cost of INR129.16 crore, ~49% of the total
construction cost has been incurred by the company till December
31, 2020. The status of the project is satisfactory pertaining to
completion of the civil construction and interior in progress. The
project is expected to be completed by end of January 2023.
However, CARE cannot comment on the same as updated information is
not available due to non-cooperation by SMPL.
Liquidity analysis: Stretched
The liquidity position of the company stood stretched marked by low
cash and bank balance of 0.34 crore, as on March 31,
2021.
Super Max Affordable Housing Private Limited (SMPL) is incorporated
in June 2015 as a private limited company. The company is currently
managed by Mr. Jawahar Lal, Mr. Anil Kumar Garg, Mr. Ankit Kumar
and Mr. Deepak Goel. The company is engaged in the real estate
development and has an on-going residential/commercial project
namely, "Supermax - The New Town" located in Sonipat, Haryana. The
company is having one associate concern namely, "Max Heights
Promoters Private Limited" (incorporated in 2013) engaged in same
line of business.
TABLEAU SOFTWARE: Voluntary Liquidation Process Case Summary
------------------------------------------------------------
Debtor: Tableau Software India Private Limited
16/13, Basement
West Patel Nagar
New Delhi 110008
Liquidation Commencement Date: March 31, 2022
Court: National Company Law Tribunal, Bangalore Bench
Insolvency professional: Vinod Sunder Raman
Interim Resolution
Professional: Vinod Sunder Raman
318, 19th Main
41st Cross, 5th Block
HBR Layout, Bengaluru 560043
E-mail: vinod@vrconsulting.biz
Tel: +919845884410
Last date for
submission of claims: April 30, 2022
TARENDRA INFRA: CARE Keeps D Debt Ratings in Not Cooperating
------------------------------------------------------------
CARE Ratings said the rating for the bank facilities of Tarendra
Infrastructure Chennai Private Ltd (TIC) continues to remain in the
'Issuer Not Cooperating ' category.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Non-Convertible 30.00 CARE D ISSUER NOT COOPERATING;
Debentures Rating continues to remain
Under ISSUER NOT COOPERATING
Category
Non-Convertible 70.00 CARE D ISSUER NOT COOPERATING;
Debentures Rating continues to remain
Under ISSUER NOT COOPERATING
Category
Detailed Rationale & Key Rating Drivers
CARE had, vide its press release dated April 6, 2020, placed the
rating of TIC under the 'issuer non-cooperating' category as the
company had failed to provide information for monitoring of the
rating. TIC continues to be non-cooperative despite repeated
requests for submission of information through e-mails dated
February 16, 2022, February 19, 2022, March 1, 2022 & March 12,
2022 and numerous phone calls. 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).
Detailed description of the key rating drivers
At the time of last rating on April 5, 2021 the following were the
rating strengths and weaknesses (Updated with FY20 financials
obtained from registrar of companies)
Key Rating Weaknesses
* Delay in interest payment for Tranche II: CARE notes that the
company has delayed in making payment towards interest which were
due on March 31, 2019 and November 2019 for Tranche 1 and Tranche
2, respectively. CARE also notes that the company is seeking for an
extension for making payment towards the same.
Key rating strengths
* Vast experience of promoters in real estate sector and
satisfactory track record: TVH group is in the business of real
estate development in Chennai since 1997 and the promoters have
long experience in the real estate development industry. The group
has been operational in Chennai since last 20 years and has also
forayed into Coimbatore market in 2008. The group has over 7.1
million sq. ft. of constructed residential and commercial space and
4.1 million sq. ft. of projects under construction. The group has
successfully completed over 30 projects in Chennai and
Coimbatore.
* Moderate pace with regard to sale of plots: Out of the total
saleable area of around 6.11 lakh square feet (lsf), the company
has sold around 3.49 lsf (i.e. around 57%) valued at INR80.94 crore
as on March 3, 2019. The company has received bookings for 245
plots which constitute around 78% of phase 1 sales.
TICPL is a special purpose vehicle (SPV) formed by the True Value
Homes (TVH) group, to develop a real estate residential project
(TVH Mannivakkam) at Mannivakkam, Chennai. The TVH Mannivakkam
project was initially conceived to be developed as plots,
independent villas, row houses, semi-independent housing units and
multi-storey apartments. Due to adverse market conditions and delay
in obtaining necessary approvals, the project has been converted
into sale of plots. Construction of villas/houses will take place
at the behest of the customers. The project was proposed to be
developed in two phases and the first phase has been launched in
May 2016. Out of the total saleable area of around 6.11 lakh square
feet (lsf), the company has sold around 3.49 lsf (i.e. around
57%).
VAISHALI REAL: Insolvency Resolution Process Case Summary
---------------------------------------------------------
Debtor: Vaishali Real Estate Private Limited
Plot No. 69, Lane No. 3
Nandnagar Colony, Karaundi
Varanasi 221005
Insolvency Commencement Date: March 30, 2022
Court: National Company Law Tribunal, Noida Bench
Estimated date of closure of
insolvency resolution process: September 26, 2022
Insolvency professional: Mr. Rajeev Ranjan Singh
Interim Resolution
Professional: Mr. Rajeev Ranjan Singh
Flat No. 14049, 16 Avenue
Gaur City-2, Greater Noida West
Gautam Buddha Nagar, Block-G
Uttar Pradesh 201310
E-mail: rajeevranjan6476@gmail.com
- and -
532, 5th Floor, Somdatt Chamber-II
Bhikaji Cama Place
New Delhi 110066
E-mail: vaishalirealestate.cirp@gmail.com
Classes of creditors: Real Estate Allottee
Insolvency
Professionals
Representative of
Creditors in a class: Rakesh Jain
Sushil Kumar Singhal
Rajeev Lochan
Last date for
submission of claims: April 13, 2022
WESTERN INDIA: CARE Keeps C Debt Rating in Not Cooperating
----------------------------------------------------------
CARE Ratings said the rating for the bank facilities of Western
India Transport Finance Company Private Limited (WitFin) continues
to remain in the 'Issuer Not Cooperating ' category.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long Term Bank 35.00 CARE C; Negative; ISSUER NOT
Facilities COOPERATING; Rating continues
To remain under ISSUER NOT
COOPERATING category
Detailed Rationale & Key Rating Drivers
CARE Ratings Ltd. has withdrawn the outstanding rating of 'CARE D;
Issuer not cooperating' assigned to the non-convertible debentures
of WitFin with immediate effect. The above action has been taken as
per data mentioned in Audited financials FY21, Company raised NCD
of INR25 crores, which has nil outstanding as on March 31, 2021.
Also, Debenture trustee confirmed that final repayment is done
through one-time settlement.
CARE has been seeking information from Western India Transport
Finance Company Private Limited to monitor the rating(s) vide
e-mail communications/letters dated March 6, 2022, February 24,
2022 and February 14, 2022. However, despite CARE's repeated
requests, the company has not provided the requisite information
for monitoring the ratings. 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. Further, Witfin has not paid
the surveillance fees for the rating exercise as agreed to in its
Rating Agreement. The rating reaffirmation on the bank facilities
of witfin continue to factor in the company has made certain
defaults in repayments of borrowings from banks/Financials
institution and payment of interest, as per audited financials
FY21.
The company reported loss of INR22.41 crores in FY21 as against
loss of INR15.26 crore in FY20 due to decrease in total income and
significant increase in provision. The company has been running
down its loan portfolio since FY20. With running down of loan book
and deteriorating asset quality has reported increase in GNPA% to
55% in FY21.
Users of this rating (including investors, lenders and the public
at large) are hence requested to exercise caution while using the
above rating(s)
Western India Transport Finance Ltd. (WitFin) is an NBFC
incorporated in April, 2006 and was granted registration from RBI
as NBFC in August, 2011. The company is promoted by Mr. Nikhil
Swadi, who is member of Swadi family which is into transportation
business since more than 40 years. The company lends to the 'used
commercial vehicle' segment, the major focus being lending of light
commercial vehicle (LCV) and Medium/Heavy Commercial Vehicle (MHCV)
forming around 62% of outstanding portfolio as on December 31, 2019
while the rest being three-wheeler loading vehicles, construction
equipment and passenger cars. The company has presence in
Maharashtra, Gujarat, Punjab and Rajasthan. As on December 31,
2019, company's total AUM stood at INR123.90 crore.
ZOTRES HOSPITALS: CARE Lowers Rating on INR13cr LT Loan to B+
-------------------------------------------------------------
CARE Ratings has revised the ratings on certain bank facilities of
Zotres Hospitals Private Limited (ZHPL), as:
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long Term Bank 13.00 CARE B+; Stable; ISSUER NOT
Facilities COOPERATING; Revised from
CARE BB-; Stable and moved to
ISSUER NOT COOPERATING category
Detailed Rationale & Key Rating Drivers
CARE has been seeking information from ZHPL to monitor the
rating(s) vide e-mail communications/letters dated February 28,
2022, March 2, 2022, March 8, 2022, March 16, 2022 among others and
numerous phone calls. However, despite CARE's repeated requests,
the company has not provided the requisite information for
monitoring the ratings. 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. The rating on ZHPL's bank facilities will
now be denoted as CARE BB-; 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(s).
Detailed description of the key rating drivers
The ratings have been revised due to unavailability of required
financial data. At the time of last rating of March 29, 2021, the
following were the rating strengths and weaknesses:
Key rating Weaknesses
* Successful completion of the project, however risk associated
with stabilization of project persists: ZHPL has successfully
completed the construction of hospital with a total cost of
INR39.25 crore (~98.13%) of total estimated project cost which was
funded by way of term loan worth INR26.47 crore and balance funded
though share capital and unsecured loans from promotes and
relatives of INR13.07 crore respectively. Further major
construction work was completed by October, 2020 and commenced its
commercial operation since November, 2020. The hospital is
operating at 50% of occupancy rate and company has generated around
INR6.30 crore revenue during last four months ended February 28,
2021 and FY22 will be first full year of operation, however it
posted cash loss as it has to incur fixed cost. The interest
servicing is done through interest free unsecured loans of
promotors. Thus, there is project stabilization risk of project.
Nevertheless, comfort can be drawn from the fact that debt
repayment will commence from October, 2021 and during FY21 the
promoters have infused funds in form of equity share capital
amounting to INR5.47 crore at premium of INR0.83 crore.
* Second phase of expansion resulting in funding and execution
risk: ZHPL is planning for second phase of expansion wherein they
purchase additional medical equipment (namely Ventilators,
Pathology equipment, DG set, Gastroenterology work station, TCNL
equipment, Garbage shredder and other medical equipment's etc.)
amounting to approx. INR4.10 crore, which will be funded through
proposed term loan facility of INR4.00 crore to be availed from
Mizoram Rural Bank and further and additional working capital limit
of INR5.00 crore to be proposed with the same bank, which is yet to
be sanctioned. Thus, project funding and execution risk persists.
Further client has put proposal to take over existing term loan
facilities availed from North Eastern Development Finance
Corporation Limited (INR10.00 crore) & CLIX Finance India Private
Limited (INR3.93 crore).
* Presence in highly regulated, competitive healthcare industry:
The operations of hospital are subject to various rules and
regulations laid by respective authorities at State and Central
government level. Any instance of non-compliance of these rules and
regulations would impact the operations of hospital resulting into
deterioration of financial risk profile of the company. The
industry is highly competitive with a number of established players
and their growing network. The healthcare and specialty hospitals
sector mainly comprises of large national level players, organized
regional players, government hospitals, charitable trusts and a
large number of nursing home, solo practice clinics and small
nursing homes mostly run by entrepreneur doctors making it highly
competitive.
Key Rating Strengths
* Experienced, professional and resourceful promoters and doctors:
The main promoter director Dr. Lalrintluanga Jahau, had completed
Post Graduated in Surgery from Ireland having more than 3 decades
of total experienced in the healthcare industry and Dr. Madhurjya
Sarmah, is a Radiologist by profession and having more than decade
of experience in healthcare industry. Moreover, the directors are
resourceful and infused INR6.30 crore in the form of equity share
capital during FY21.
* Established presence of group in the Mizoram: The group companies
(namely Trinity Diagnostic Center (engaged in healthcare services),
Aidu Motors Private Limited (authorized distributorship of Renault
India Pvt Ltd), Zoram Mega Food Park Pvt Ltd (engaged in food
processing services), Lushaihills Logistics Pvt Ltd (engaged in
providing logistic services) etc.) of ZHPL having long track record
in the field of healthcare, food park, logistics and vehicle
distributorship industries which are currently operates in Aizawl,
Mizoram having established track record of operations. Hence,
established group presence of the group companies provide strong
marketing connects to the company.
* Locational advantage of the Hospital: The hospital site of ZHPL
is strategically located at Melthum, Aizawl being the capital city
of Mizoram. It is in the junction of the Aizawl ring road (also
called the World Bank Road) and the National Highway connecting
Aizawl and Lunglei. The role of the private health sector in
providing healthcare services to the people is quite considerable
in Mizoram primarily due to the inadequate supply of healthcare
staff by the government in relation to the growing demand for this
service and the failure of public health providers in meeting this
demand. Currently there are only 11 government / civil hospitals
available in the Mizoram with total bed strength of less than 1000
beds against the total population of 10,97,206 (as per the Census
2011). Further, there are only a few hospitals in the whole region
which are well equipped with modern infrastructure and specialist
doctors.
Liquidity: Stretched
Liquidity of ZHPL is stretched on account of negative GCA and
continued negative cash flow from operations. The company has
outstanding term debt of INR25.45 cr. as on March-21.
Zotres Hospitality Private limited (ZHPL) was incorporated on
October 22, 2018 as a Private limited company and currently managed
by Dr. Lalrintluanga Jahau (MBBS, MSRC) having more than 3 decades
of experience in healthcare industry and Dr. Madhurjya Sarmah
(MBBS, DMRD) is radiologist by profession having more than decade
of experience in healthcare industry. The company has successfully
setup the Multi-Speciality Secondary Care Hospital having 110 beds
capacity with 3 operation theatres, pre-operative and
post-operative wards, labor rooms, and nursing station etc. Further
the construction work has completed in October, 2020 and ZHPL has
started its commercial operation since November, 2020, thus FY22
will be the first full year of operation.
===============
M A L A Y S I A
===============
1MDB: Prosecutor Urges Ex-Goldman Banker's Conviction
-----------------------------------------------------
Reuters reports that a U.S. prosecutor on April 4 urged jurors to
convict a former senior Goldman Sachs banker for helping loot
billions of dollars from Malaysia's 1MDB sovereign wealth fund,
while the defense accused the government's star witness of lying.
In her closing argument in Brooklyn federal court, Assistant U.S.
Attorney Alixandra Smith said the defendant Roger Ng received more
than $35 million in kickbacks from the "brazen" bribery and money
laundering scheme, and must be held accountable, Reuters relates.
Mr. Ng's lawyer Marc Agnifilo countered that his client, who had
been Goldman's former top investment banker for Malaysia, was
falsely implicated by his former boss Tim Leissner, the star
witness, according to Reuters.
"He never stopped lying ever, and he didn't stop lying in this
courtroom," Mr. Agnifilo said, referring to Mr. Leissner.
Closing arguments are expected to end on April 5, followed by the
judge instructing jurors on the law and the start of
deliberations.
Reuters says the nearly two-month trial stemmed from one of the
biggest financial scandals in history.
Reuters relates that prosecutors have said Goldman helped 1MDB
raise $6.5 billion through three bond sales, but that $4.5 billion
was diverted to government officials, bankers and their associates
through bribes and kickbacks.
Goldman in 2020 paid a fine of nearly $3 billion and its Malaysian
unit agreed to plead guilty. The scheme's suspected mastermind,
Malaysian financier Jho Low, remains at large, the report notes.
Mr. Ng, 49, has pleaded not guilty to conspiring to launder money
and violating an anti-corruption law, and will likely be the only
person tried in the United States over 1MDB, Reuters says.
According to Reuters, prosecutors said Mr. Ng helped Mr. Leissner
embezzle hundreds of millions of dollars, launder the proceeds and
bribe officials to win business for Goldman.
"The harm to the people of Malaysia is immeasurable," Ms. Smith
told jurors. "It is deeply unfair to everyone else who plays by the
rules."
Mr. Leissner, 52, pleaded guilty in 2018 to similar charges as Mr.
Ng.
Reuters says Mr. Agnifilo focused his closing argument on Mr.
Leissner's credibility, after Leissner admitted during testimony
that he "lied a lot."
While the defense acknowledged that Mr. Ng introduced Mr. Leissner
to Mr. Low, Mr. Agnifilo said his client played no further role,
and Mr. Leissner lied to get a lighter sentence.
"Roger is basically the fall guy for this whole thing," the report
quotes Mr. Agnifilo as saying.
According to the report, Ms. Smith acknowledged that Mr. Leissner
was seeking leniency by testifying, but said other testimony backed
up his story.
"What he told you about the crimes he committed with the defendant
and others is backed up by and consistent with other evidence," the
report Ms. Smith as saying. "You already know the defendant is
guilty from the other evidence."
Mr. Ng has acknowledged receiving $35 million from Mr. Leissner,
but jurors will need to sort out what the money was for.
Reuters relates that Mr. Leissner said that money represented
kickbacks from 1MDB, and that he agreed with Mr. Ng to tell banks
processing the transfers a "cover story" that it came from a
legitimate business venture between their wives.
Mr. Ng's wife, Hwee Bin Lim, testified for the defense that she
invested $6 million in the mid-2000s in a Chinese company owned by
the family of Mr. Leissner's then-wife, Judy Chan.
She said the $35 million was her return on that investment.
Mr. Low was indicted in 2018 alongside Mr. Ng. Malaysian
authorities say Mr. Low is in China, which Beijing denies.
About 1MDB
Kuala Lumpur-based 1Malaysia Development Bhd (1MDB) is an insolvent
Malaysian strategic development company, wholly owned by the
Malaysian Minister of Finance. 1MDB was established in 2009 to
foster long-term economic development for the country by forging
global partnerships, particularly in energy, real estate, tourism,
and agribusiness.
The Company was founded shortly after Dato Sri Najib Razak became
Prime Minister of Malaysia in July 2009. Najib said the
establishment of 1MDB into a federal entity was to benefit a
majority of Malaysians.
1MDB is said to have raised billions of dollars in bonds, for
investment projects and joint ventures, between 2009 and 2013.
Among those projects are the Tun Razak Exchange, Tun Razak
Exchange's sister project Bandar Malaysia, and the acquisition of
three independent power producers.
The Company came into heavy scrutiny in 2015 for suspicious money
transactions and evidence pointing to money laundering, fraud and
theft. The corruption scandal in 1MDB has implicated high-level
officials, including Prime Minister Najib Razak, as wells as banks
and financial institutions around the world.
In 2016, the U.S. Department of Justice filed a lawsuit, alleging
that at least US$3.5 billion has been stolen from 1MDB. In
September 2020, the alleged amount stolen had been raised to US$4.5
billion and a Malaysian government report listed 1MDB's outstanding
debts to be US$7.8 billion.
Malaysia has been filing lawsuits over the years in an effort to
recover the missing billions of dollars. Among others, in May
2021, Malaysia filed 22 civil suits against entities and people
involved in the corruption scandal, including units of Deutsche
Bank and JP Morgan.
Malaysia said in September 2020 it has so far recovered about
US$3.24 billion in assets linked to the 1MDB matter. This amount
includes about US$600 million cash and assets returned by U.S.
authorities; about US$2.5 billion paid by Goldman Sachs as
settlement; as well as US$780 million in settlement amounts from
Malaysian banking group AmBank and audit firm Deloitte.
=====================
N E W Z E A L A N D
=====================
A 2 Z NZ: Court to Hear Wind-Up Petition on May 13
--------------------------------------------------
A petition to wind up the operations of A 2 Z NZ Powercom Limited
will be heard before the High Court at Auckland on May 13, 2022, at
10:00 a.m.
Steelcraft Structural Limited filed the petition against the
company on Feb. 4, 2022.
The Petitioner's solicitor is:
Nicholas Peter Gillies
Hesketh Henry Lawyers
Level 14, 188 Quay Street
Auckland 1010
BA SCOTT: Creditors' Proofs of Debt Due on May 13
-------------------------------------------------
Creditors of BA Scott Trustee Company Limited are required to file
their proofs of debt by May 13, 2022, to be included in the
company's dividend distribution.
The company commenced wind-up proceedings on March 31, 2022.
The company's liquidator is:
Benjamin Francis
Gerry Rea Partners
PO Box 3015
Auckland
INDUSTRY MANAGEMENT: Creditors' Proofs of Debt Due on April 22
--------------------------------------------------------------
Creditors of Industry Management Systems Limited, IMS Nominees
Limited and TD 2021 Limited (formerly The Tile Depot Company
Limited) are required to file their proofs of debt by April 22,
2022, to be included in the company's dividend distribution.
The company commenced wind-up proceedings on March 30, 2022.
The company's liquidator is:
Steve Young
PO Box 204276
Highbrook, Auckland 2161
J. AND J. WATT: Creditors' Proofs of Debt Due on May 5
------------------------------------------------------
Creditors of J. and J. Watt Limited are required to file their
proofs of debt by May 5, 2022, to be included in the company's
dividend distribution.
The company commenced wind-up proceedings on April 4, 2022.
The company's liquidators are:
Steven Khov
Kieran Jones
Khov Jones Limited
PO Box 302261
North Harbour, Auckland 0751
WOODAPPLE LIMITED: Court to Hear Wind-Up Petition on May 27
-----------------------------------------------------------
A petition to wind up the operations of Woodapple Limited will be
heard before the High Court at Auckland on May 27, 2022, at 10:00
a.m.
Conference SME Limited filed the petition against the company on
Jan. 26, 2022.
The Petitioner's solicitors are:
Claymore Partners Limited
Level 2, 63 Fort Street
Auckland 1010
=====================
P H I L I P P I N E S
=====================
METRO CEBU PUBLIC: Central Bank Closes Thrift Bank
--------------------------------------------------
The Monetary Board (MB) of the Bangko Sentral ng Pilipinas (BSP)
prohibited Metro Cebu Public Savings Bank from doing business in
the Philippines through MB Resolution No. 434.E dated March 31,
2022 which also directed the Philippine Deposit Insurance
Corporation (PDIC), as Receiver, to proceed with the takeover and
liquidation of the bank. The PDIC took over the bank on April 1,
2022.
Metro Cebu Public Savings Bank is a three-unit thrift bank with
head office located at the 2/F Sia Bldg., N. Bacalso Ave., Brgy.
Duljo (Pob.), Cebu City. Its branches are located in Lapu-lapu
City, Cebu and Tabunok in Talisay, Cebu.
Latest available records show that as of December 31, 2021, Metro
Cebu Public Savings Bank has 6,446 deposit accounts with total
deposit liabilities of PHP225.9 million, of which 78.4% or P177
million are insured deposits.
The PDIC assured depositors that all valid deposits and claims will
be paid up to the maximum deposit insurance coverage of
PHP500,000.00 per depositor.
Individual account holders of valid deposits with balances of
PHP100,000.00 and below, who have no outstanding obligations or
have not acted as co-makers of obligations with Metro Cebu Public
Savings Bank are not required to file deposit insurance claims.
These individual depositors must ensure that they have complete and
updated addresses with the bank. Depositors may update their
addresses by submitting a Mailing Address Update Form (MAUF) until
April 18, 2022, either through the drop box available at the bank
premises, or by sending a scanned copy of said Form and valid ID to
email address, metro-pad@pdic.gov.ph. MAUF will be made available
at the bank premises or may be downloaded from the PDIC website at
www.pdic.gov.ph. Insurance payments for valid deposits with
balances of PHP100,000.00 and below will be made through postal
money order and targeted to be sent via mail starting on May 4,
2022.
For business entities and all other depositors, filing of claims
for insured deposit is targeted to start by May 16, 2022.
Borrowers are likewise reminded to continue paying their loan
obligations with the closed Metro Cebu Public Savings Bank and to
transact only with designated PDIC representatives.
For more information on the requirements and procedures for filing
deposit insurance claims and settlement of loan obligations,
depositors and borrowers of the bank are enjoined to attend the
virtual Depositors-Borrowers' Forum scheduled on April 29 to May 2,
2022. Further details on the DBF, filing of claims, and procedures
on loan settlement, will be announced through the PDIC website,
www.pdic.gov.ph, and PDIC's official Facebook page,
www.facebook.com/OfficialPDIC.
As provided for by the PDIC Charter, the PDIC shall likewise accept
Letters of Intent from interested banks and non-bank institutions
for possible purchase of assets and assumption of liabilities (P&A)
as a mode of liquidating Metro Cebu Public Savings Bank. Letters of
intent should be submitted within 60 days from takeover date
subject to compliance with the requirements prescribed under the
Guidelines in Pre-qualifying Proponents and Evaluating the
Proposals for Purchase of Assets and Assumption of Liabilities Mode
of Liquidating Closed Banks which can be accessed in the PDIC
website.
To ensure the safety of all concerned and observance of health
protocols, all clients of the bank may communicate with PDIC
through any of the following modes: Public Assistance Hotline
during office hours at (02) 8841-4141, Toll-Free Hotline at
1-800-1-888-PDIC (7342) during office hours for those outside Metro
Manila, e-mail to metro-pad@pdic.gov.ph or Facebook private
message. For visits to the PDIC Public Assistance Center, clients
are highly encouraged to request for an appointment, observe health
protocols and present their vaccination cards. Appointment schedule
may be secured through telephone, email or Facebook private
message.
=================
S I N G A P O R E
=================
ARA LOGOS: Receive Writ of Summons for SGD8MM Claim
---------------------------------------------------
The Business Times reports that the trustee and the property
manager of Ara Logos Logistics Trust (ALog Trust) have received a
writ of summons for a claim amounting to about S$8 million, plus
interest and costs.
This was over an incident resulting in damages to certain parts of
ALOG Cold Centre, in the premises previously tenanted by
TheSeafoodCompany, said the real estate investment trust's (Reit)
manager in a bourse filing.
The manager is in discussions with its insurers regarding the
claim. It said that legal counsel has also been engaged to advise
on the matter.
ALOG Cold Centre, located at 2 Fishery Port Road, is a 2-storey
ramp-up cold storage warehouse. It is in a food zone within Jurong
Industrial Estate and near the sea ports.
ASIARETAIL III: Members' Final Meeting Set for May 6
----------------------------------------------------
Members of Asiaretail III (Singapore) Pte Ltd will hold their final
meeting on May 6, 2022, at 10:00 a.m., at One Raffles Quay North
Tower 18th Floor, in Singapore.
At the meeting, Aaron Loh Cheng Lee, the company's liquidator, will
give a report on the company's wind-up proceedings and property
disposal.
HM RETAIL: Members' Final Meeting Set for May 6
-----------------------------------------------
Members of HM Retail Pte Ltd will hold their final meeting on May
6, 2022, at 10:30 a.m., at One Raffles Quay North Tower 18th Floor,
in Singapore.
At the meeting, Aaron Loh Cheng Lee, the company's liquidator, will
give a report on the company's wind-up proceedings and property
disposal.
KYUDENKO SOUTH: Creditors' Proofs of Debt Due on May 5
------------------------------------------------------
Creditors of Kyudenko South East Asia Pte. Ltd. are required to
file their proofs of debt by May 5, 2022, to be included in the
company's dividend distribution.
The company commenced wind-up proceedings on March 30, 2022.
The company's liquidator is:
Mitani Masatoshi
c/o 10 Anson Road
#14-06 International Plaza
Singapore 079903
SCANMICRON PRIVATE: Creditors' Meetings Set for April 19
--------------------------------------------------------
Scanmicron Private Limited will hold a meeting for its creditors on
April 19, 2022, at 10:30 a.m., via an audio-visual conference on
the Zoom Platform.
Agenda of the meeting includes:
a. to lay before the creditors a full statement of the affairs
of the Company, showing the assets and liabilities of the
company;
b. to appoint a Committee of Inspection if deemed necessary;
c. to resolve that the books, accounts and documents of the
Company be destroyed pursuant to Section 195(2) of the
Insolvency, Restructuring and Dissolution Act 2018; and
d. Any other business.
TAIGER: AI Startup Liquidates Singapore Entity, Over 80 Jobs Axed
-----------------------------------------------------------------
The Business Times reports that TAIGER, an artificial intelligence
(AI) startup backed by government-owned SGInnovate and corporate
investors, is shutting its Singapore headquarters and liquidating
its local entity after racking up debts it cannot pay.
Over 80 employees from the Singapore office have been terminated
due to the liquidation, Taiger said in response to queries from The
Business Times.
The company said it is offering assistance to affected staff
looking for new roles, BT relates.
*********
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 ***