key credit brief - kotak mahindra bank · in may 2018, til’s oard approved a scheme for demerger...
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Key Credit Brief
Key Credit Brief
Page | 1
Please click here to check the Holdings in our Fixed Income Funds or refer to page no 25
Sr no:
Credit Papers Ratings *Upgrade/ Downgrade
Pg. no.
(A) Kotak Credit Process 3
New Credit
1 Century Textiles & Industries Ltd CRISIL AA/A1+, CARE A1+ No Change 4
2 Godrej Properties Ltd ICRA AA/A1+, CRISIL A1+ No Change 4
(B) Existing Credit
3 Nayara Energy Limited CARE AA No Change 5
4 Coastal Gujarat Power Ltd. (Guaranteed by Tata Power Co. Ltd ) CARE AA(SO) No change 5
5 JM Financial Asset Reconstruction Company ICRA AA-/A1+, CARE AA-/ A1+, CRISIL AA-/A1+
No change 6
6 Altico Capital India Pvt Ltd IND AA- / ICRA A1+ No Change 6
7 Avendus Finance Pvt Ltd CRISIL A+ / A1+ No Change 6
8 Rent A Device Trust ICRA AAA(SO) No Change 7
9 Endurance Technologies Ltd CRISIL AA / A1+ No Change 7
10 Green Infra Wind Energy ICRA A1+, CRISIL A1+ No Change 7
11 Utkarsh Small Finance Bank ICRA A1 No Change 8
12 AASAN Corporate Solutions Private Limited ICRA AA- (SO) No Change 8
13 Incred Financial Services Private Limited (Visu Leasing and Finance) CARE A/A1 No Change 8
14 Jyothy Fabricare Services Limited CARE AA(SO) No Change 9
15 Suhani Trading and Investment Consultants Pvt Ltd BWR A+ (SO) No Change 9
16 Punjab National Bank
IND A+ CARE AA- CRISIL AA BWR AA (for Additional Tier1 Bonds)
No Change
9
17 Muthoot Capital Services Limited CRISIL A1 No change 10
18 Sarvoday Advisory Services Pvt. Ltd BWR A(SO) No change 10
19 Bharti Telecom Ltd CRISIL A1+ No change 10
20 Future Lifestyle Fashions Ltd CRISIL AA- No change 10
21
Aarish Solar Power Ltd. / Aashman Energy Pvt. Ltd. / Divyesh Power Pvt. Ltd. / Elena Renewable Energy Pvt. Ltd. / Pratyash Renewable Pvt. Ltd. / SEI Baskara Power Pvt. Ltd. / SEI Enerstar Renewable Energy Pvt. Ltd. / SEI Mihir Energy Pvt. Ltd. / Zuvan Energy Pvt. Ltd / Shreyas Renwable Energy Pvt. Ltd
CARE AA-(SO) No change 11
22 Adani Infra (India) Ltd BWR AA-(SO) No change 11
23 Aspire Home Finance Corporation Ltd ICRA A+ No change 11
24 Ananta Landmarks Pvt Ltd. Unrated No change 11
25 AU Small Finance Bank Ltd. AA-/A1+ by CRISIL, ICRA India Ratings, CARE
No change 12
25 Asirvad Microfinance Pvt. Ltd CRISIL A+ No change 12
27 Barclays Investments & Loans (INDIA) LTD. ICRA AAA / A1+ No change 12
Key Credit Brief
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*Upgrade/Downgrade change for the NOVEMBER 2018 month.
28 Bhopal Dhule Transmission Company Limited CRISIL AAA No change 13
29 Birla TMT Holding Pvt Ltd, Turquoise Investments & Finance Pvt Ltd CRISIL A1+ No change
13 TGS Investment & Trade Pvt Ltd, Trapti Trading & Investments Pvt Ltd ICRA A1+ No change
30 Konti Infrapower & Multiventures PvtLtd/ Edison Utility Works Pvt.Ltd. BWR A+(SO) No change 13
31 Dewan Housing Finance Corp Ltd CARE AAA/A1+ No change 14
32 Dalmia Cement Bharat Ltd ICRA AA/A1+ No change 14
33 ECL Finance Ltd ICRA AA/CRISIL A1+ No change 14
34 East-North Interconnection Company Limited CRISIL AAA(SO) No change 15
35 Edelweiss Agri Value Chain Limited CARE AA(SO) No change 15
36 Essel Lucknow Raibareli Toll Roads Limited CARE AAA No change 16
37 Fullerton India Credit Co. Ltd. CARE AAA/ICRA A1+ No change 16
38 HPCL Mittal Energy Ltd. and HPCL Mittal Pipelines ICRA AA No change 16
39 Igarashi Motors Sales Pvt. Ltd . (IMSPL) ICRA AAA (SO) No change 17
40 IIFL Wealth Finance Ltd (IWFL) ICRA AA/A1+ No change 17
41 India Infoline Finance Ltd CRISIL AA/A1+ No change 17
42 Indostar Capital Finance Ltd CARE AA- No change 17
43 IOT Utkal Energy Services Ltd CRISIL AAA(SO) No change 18
44 Jana Small Finance Bank ICRA BBB No change 18
45 Karelides Traders Private Limited ICRA AA- (SO) No change 18
46 Manappuram Finance Ltd CARE AA/ A1+ No change 18
47 Muthoot Fincorp Ltd CRISIL A/BWR A+ No Change 19
48 Nabha Power Ltd ICRA AAA(SO)/ CRISIL A1+ No change 19
49 Nuvoco Vistas Corporation Ltd CRISIL AA No change 19
50 Jamnagar Utilities & Power Pvt Ltd CRISIL AAA No change 19
51 Powergrid Vizag Transmission Ltd. CRISIL AAA(SO) No change 20
52 Prestige Estates Projects Ltd ICRA A+ No change 20
53 S D Corporation Private Limited ( backed by unconditional and irrevocable DSRA guarantee of Shapoorji Pallonji & Co Pvt Ltd)
CARE AA+(SO)
No change
21
54 Sahyadri Agencies Ltd. BWR A(SO) No change 21
55 SBK Properties Pvt. Ltd. ICRA AA- No change 21
56 Shapoorji Pallonji Energy Gujarat Private Ltd (backed by unconditional and irrevocable DSRA guarantee of Shapoorji Pallonji & Co Pvt Ltd )
ICRA AA-(SO) Downgraded 22
57 SP Jammu Udhampur Highways Ltd ICRA AAA(SO)) No change 22
58 Suraksha Realty Ltd
CARE A1+(SO) No change 23
Suraksha Asset Reconstruction Co. Ltd
59 Tata Motors Finance Solutions CRISIL AA/ CARE A1+ No change 23
60 Tata Power Ltd. CRISIL AA-/ICRA A1+ No change 23
61 U P Power Corporation Ltd IND AA(SO)/A+(SO) No change 24
Holdings in our Fixed Income Funds as of 30th November 2018 25
Key Credit Brief
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Kotak Credit Process – Mitigating Risk through Robust Practices
Robust Credit Evaluation Process at Kotak MF
Key Credit Brief
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New Credit
Century Textiles & Industries Ltd (CRISIL AA/A1+, CARE A1+)
Century Textiles & Industries Ltd (hereinafter, CTIL) was incorporated in 1897 and is the flagship
company of the BK Birla group. CTIL is promoted by Mr. B. K. Birla but after significant equity infusion,
Aditya Birla group now holds 50.21% stake in the company (as on March 31, 2018).
CTIL is a diversified conglomerate engaged in manufacturing of cement, textiles (cotton textiles,
viscose filament yarn, continuous spun yarn and rayon tyre yarn), pulp and paper (writing and printing
paper, tissue paper, paper board), chemicals (caustic soda, sulphuric acid, salt, etc.) and real estate.
CTIL has a total capacity of 13.1 tonne p.a. (tpa) cement across 6 manufacturing units located in
Chhattisgarh, Madhya Pradesh, Maharashtra and West Bengal. The company also has a multi-layer
packaging board facility with installed capacity of 18,000 tpa.
The company forayed into real estate business in 2010 and has two commercial real-estate projects
under its belt – Birla Aurora and Birla Centurion (both located in Worli, Mumbai). In FY18, CTIL set up
a wholly owned real-estate subsidiary – Birla Estates Pvt Ltd (BEPL). Century now plans to develop
residential projects in a mix of own and joint development agreements through BEPL.
In May 2018, CTIL’s Board approved a scheme for demerger of its cement division into Ultratech
Cement Ltd. CTIL obtained requisite approvals from Competition Commission of India and its own
shareholders in Aug 2018 and Oct 2018, respectively. The deal is expected to be completed by end of
FY2019.
Godrej Properties Ltd (ICRA AA/A1+, CRISIL A1+)
Godrej Properties Ltd (hereinafter, GPL) is currently developing residential, commercial and township
projects spread across approximately 12 cities.
GPL is a part of the Godrej Group which is amongst India’s most diversified conglomerates. The Godrej
Group was established in 1897 and comprises of a varied business portfolio that includes real estate
development, fast moving consumer goods, advanced engineering, home appliances, furniture,
security, and agri-care.
In 2010, Godrej Properties became a publicly listed company through a successful IPO in which it
raised USD 100 million. It is one of India's only national developers with a strong presence across the
country's leading real estate markets.
The turnover has been in range of Rs 1,600 cr to Rs 2,200 cr in last 3 years with corresponding EBITDA
margin of 23%-28%.
Balance sheet structure is acceptable with gross gearing of 1.7x in FY’18. With capital raise of Rs
1,000cr post FY’18 gross gearing has improved to 1.1x (inc. Rs 1,000 cr capital in FY18 NW).
Operating cash flows have been strong at ~Rs 1,800 cr in FY’18 due to increased inventory liquidation.
Key Credit Brief
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Existing Credit
Nayara Energy Limited (CARE AA)
Incorporated in 1989, Nayara Energy Limited (formerly known as Essar Oil Limited) is an Oil and Gas
company engaged in refining and marketing.
It owns India's second-largest single location Refinery (at Vadinar, Gujarat) having a capacity of 20
million metric tons per annum (mmtpa; equivalent to 140 million barrels) and high complexity, which
allows it to process crude oil with a blend of 23-30 API.
It can process wide variety of crude oil ranging from ultra-heavy, high sulphur, sour crude (i.e. low
API) to low sulphur light crude (i.e. high API) and has the flexibility to achieve the product slate based
on expected demand.
In August 2017, Essar Oil Limited (excluding Exploration & Production Division), along with its captive
port and power assets, was acquired by Petrol Complex Pte. Limited (49.13%), a company owned by
Rosneft Oil Company (a leader of Russia’s petroleum industry and second largest company in the
world in terms of hydrocarbon production and reserves) and Kesani Enterprises Company Limited
(49.13%), an investment consortium comprising of global commodity trading firm Trafigura Pte. Ltd.,
UCP PE Investments Ltd., and Oil Holding Limited at an enterprise value of USD 12.9billion.
The equity value of transaction was USD 7.5billion
Coastal Gujarat Power Ltd. (Guaranteed by Tata Power Co. Ltd) (CARE AA(SO))
CGPL had implemented a 4,150-MW Ultra Mega Power Project (UMPP) in Mundra in Gujarat. The
operations started in 2013.
CGPL has entered into Power Purchase Agreement (PPA) with DISCOMs in Maharashtra (760 MW),
Gujarat (1805 MW), Rajasthan (380 MW), Punjab (475 MW) and Haryana (380 MW) for 3,800 MW
power supply.
CGPL is a wholly owned subsidiary of Tata Power, which has a strong market position as integrated
power player. Tata Power is rated AA- by CRISIL.
Exposure on CGPL is guaranteed by unconditional and irrevocable guarantee of Tata Power.
In FY18, Tata Power had a consolidated turnover of Rs ~29,000 cr with EBITDA margin of 22% and
PAT margin of 9%, and a moderate balance sheet structure with Net Debt/Equity of 2.5x.
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JM Financial Asset Reconstruction Company (ICRA AA-/A1+, CARE AA-/ A1+, CRISIL AA-/A1+)
JMFAR is the asset reconstruction arm of JM Financial Group. It started operations in September 2008.
JM Financial Group owns 57.1% of JMFAR while the remaining shareholding is spread between
promoter group, public sector banks and institutional investors.
Asset reconstruction business involves acquisition and resolution of distressed debt assets sold by
banks or financial institutions
JMFAR initiates resolution of distressed assets either through a negotiated settlement with the entity
(one time settlement), or by undertaking a debt restructuring process (acquisition as going concern
and then attempt financial turnaround of the acquired company)
Total AUM of the entity is ~Rs 13,000 cr in FY’18. Majority of AUM is currently spread across
hospitality, real estate, pharmaceutical, textiles and ceramic industry
JMFAR had income of Rs 388 cr in FY18 with PAT of 108 cr. The company is well capitalized with gross
gearing of 1.4x in FY’18
Altico Capital India Pvt Ltd (IND AA-, ICRA A1+)
Altico was established in 2004 by Clearwater Capital Partners LLC as Clearwater Capital Partners India
Private Limited for wholesale lending to Indian SMEs. In January 2005, it was registered as a non-
deposit accepting NBFC with the Reserve Bank of India. Its business strategy initially focused on special
situation opportunities across capital structures.
In FY15 the company was rebranded to Altico Capital India Pvt. Ltd marking a change in the business
strategy. Clearwater Capital Partners, Abu Dhabi Investment Council and Varde Partners have infused
a combined capital of US$ 300 million in Altico Capital India Pvt Ltd.
The company is mainly focused on senior secured lending to mid-income residential projects across
Tier-1 cities in India which include Mumbai, NCR, Chennai, Bangalore, Pune and Hyderabad. The
Company may look at commercial and other allied sectors (to real estate sector) in the future.
Avendus Finance Pvt Ltd (CRISIL A+/A1+)
Avendus Finance Pvt Ltd (‘AFPL’) is an NBFC and a part of the Avendus Group.
AFPL provides financing solutions to its corporate clients through Structured Debt/Mezzanine/High
Yield products and assists in capital structuring as well as arranging financing for various requirements.
AFPL is a wholly owned subsidiary of Avendus Capital Private Limited (ACPL). Private equity firm
Kohlberg Kravis Roberts (KKR Group) owns around 65% in ACPL (parent of AFPL). ACPL is the flagship
company of the group and operates in M&A advisory, PE syndication and equity capital markets.
KKR became the dominant shareholder by infusing Rs 460 crores into ACPL to expand the financing,
wealth management, and other businesses in 2015.
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Further, in Nov’17, ACPL raised 980 crores of equity from KKR, Gaja Capital and other investors. KKR
holds 65.33%, Gaja capital holds 7.40% and the three founders hold 17.14% in ACPL.
Rent A Device Trust (ICRA AAA(SO))
It is a securitization transaction through Pass-Through Certificates (PTCs) which are backed by rentals
due from Reliance Retail Limited (Renter/ RRL). The same receivables are assigned to the Rent a
Device Trust.
The same is rated as AAA(SO) by ICRA as the primary risk is predicated on Reliance Retail which is
rated as AAA.
Reliance Retail Limited is a step - down subsidiary of Reliance Industries Limited that owns about
94.4% stake in Renter through Reliance Retail Ventures Limited (RRVL).
RIL forayed into the retail business in 2006 and has supported the growth of this business over the
past decade through significant funding (total investments of ~Rs. 6,300 crore made as on March 31,
2018 in form of equity and convertible instruments) making RRL the largest retailer in the country.
Endurance Technologies Ltd (CRISIL AA/A1+)
Endurance Technologies was established in 1985 by Mr. Anurag Jain (nephew of Rahul Bajaj, Chairman
– Bajaj Auto).
Endurance Technologies, a listed company, is one of India’s leading automotive component
manufacturing companies for its product portfolio. The company began with manufacturing of
aluminum castings.
Over time it has grown organically in India, by diversifying into two and three wheeler suspension,
transmission and braking systems products. At the same time, the Company has successfully grown
inorganically through various strategic acquisitions in Europe. The Company derives 70% revenue
from India and the remaining 30% from Europe.
The domestic business is mostly 2-wheeler business with greatest revenue contribution coming from
aluminum casting (44% of domestic revenues) followed by suspension (34%), transmission (8%),
Braking (7%) and aftermarket and others (7%).
In the Indian markets, the company primarily started as a supplier to Bajaj Auto. However, over the
years it has successfully added new customers like Hero MotoCorp, Honda Motorcycles and Scooters,
Royal Enfield, Yamaha, etc. In Europe, Endurance is a 4W aluminum casting supplier and caters to
customers like FCA Italy SpA (Fiat), Daimler, Jeep, etc.
Green Infra Wind Energy (ICRA A1+, CRISIL A1+)
GIWE is one of the major renewable independent Power Producers (with operational and under
construction assets of 1.05 GW) and is 100% owned by Sembcorp Green Infra Ltd (SGIL) which is
flagship renewable company of Sembcorp Group in India with total renewable power generation
capacity of 1.7 GW.
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Sembcorp is a Singapore based group with focus on Utilities and offshore Engineering and has a
market cap of SGD 4.8 bn. Temasek Holdings owns 49.5% in Sembcorp.
All capacity of GIWE is tied up with State Government/Solar Energy Corporation Ltd and Power
Trading Corporation with 25 year PPAs giving long term revenue visibility and ensuring low offtake
risk.
Balance sheet of the GIWE is stronger than most renewable players in India with consol. Debt/Equity
of ~2.2x in FY18.
Our exposure in CPs is guaranteed by Sembcorp Green Infra Ltd (SGIL).
Utkarsh Small Finance Bank (ICRA A1)
Utkarsh SFB is promoted and helmed by Mr. Govind Singh in the capacity of Managing Director & CEO.
Mr. Singh has over three decades of experience in microfinance, banking and finance.
Total loan book as on FY18 was ~Rs 3,100 crores out of which ~90% is microfinance (under Joint
Lending Model) given the vintage of the group in microfinance space. The company has started
operations in Wholesale loans, MSME and Affordable Housing and expects to grow portfolio through
these segments.
~80% of book is concentrated in UP and Bihar given the vintage. However, this number is coming
down.
The entity is moderately capitalized with overall capital adequacy ratio of 17.4%.
The asset quality is under control with net NPA of 1.1% in FY18
AASAN Corporate Solutions Private Limited (ICRA AA-(SO))
The company is wholly-owned by Sri Krishna Trust, through its trustee Mr. Ajay Piramal.
The NCDs are secured by an unconditional, irrevocable and continuing guarantee by The Sri Krishna
Trust (SKT) and Piramal Management Services Private Limited (PMSPL) that would cover all obligations
that may arise on the rated NCDs.
SKT holds 43.71% shareholding in Piramal Enterprises Limited (PEL) and is the single largest
shareholder in PEL
There is a borrowing cap of Rs 4,500 crores or 25% of market value of free and unencumbered listed
shares of PEL held by SKT.
Incred Financial Services Private Limited (CARE A/A1)
‘Visu Leasing and Finance Private Limited’ (VLF) is an NBFC and operates under brand name ‘InCred’.
VLF typically offers four kinds of loan products like
i. Personal Loans,
ii. Home Loans,
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iii. Education Loans and
iv. SME Loans.
The InCred group lends through its new age financial services technology platform “InCred- credit for
Incredible India” that leverages technology and data-science to make lending quick and convenient.
The promoter, Mr. Bhupinder Singh (MBA, IIM Ahmedabad) has more than two decades of experience
in financial services sector (majority of experience in Deutsche Bank).
Overall loan book of VLF was Rs 1,892 crores which is well diversified across products classes and net
worth was Rs 602 crores in June 2018. The NBFC is well capitalized with Capital Adequacy ratio of
31.1% in June 2018, much higher than RBI requirement of 15%.
Jyothy Fabricare Services Limited (Guaranteed By Jyothi Laboratories Ltd.) (CARE AA(SO))
Jyothy Fabricare Services Ltd (JFSL), incorporated in 2008, is a subsidiary of Jyothy Laboratories Ltd
(JLL).
JFSL provides dry cleaning and laundry services, on B2B and B2C basis through two subsidiaries – Four
Seasons Dry Cleaning Co. Ltd. & Snoways Launderers and Drycleaners Pvt. Ltd.
Exposure to JFSL is guaranteed by Jyothy Laboratories Ltd. (JLL).
JLL, incorporated in 1983, is a well-known FMCG brand with product offerings in multiple segments -
detergents, soaps, toilet cleaners, personal care, household insecticides and insect repellents, etc. JLL
acquired Henkel India Ltd and Henkel Marketing India Ltd. in FY 2011-12.
Suhani Trading and Investment Consultants Pvt Ltd (Secured by Equity shares of Future Retails Ltd & Future Lifestyle Fashions Ltd.) (BWR A+(SO))
Promoter entity of Future Group (Kishore Biyani Group).
Transaction structured as Loan Against Shares (LAS).
Transaction has a security cover of 1.35x of Future Retail (FRL) and 0.25x of Future Lifestyle Fashions
Limited (FLF). Further, 0.25x shares of FRL and FLF (in the same ratio of cover) will be kept in a separate
demat account.
Also, personal guarantee of Kishore Biyani.
Punjab National Bank (India Ratings A+, CARE AA-, CRISIL AA, BWR AA for Additional Tier 1 Bonds)
Punjab National Bank is the second largest Public Sector Bank in India.
Govt. of India (GOI) owns 62.25% in PNB and Life Insurance Corporation (LIC) owns around 12.24%
(Jun 30, 2018).
As on Sep 30, 2018 PNB had - total capitalization of 10.08% with Common Equity (CET1) of 6.49%;
substantial distributable reserves (~Rs 9,560 crs). PNB has reported net loss of Rs 5,472 crores for the
half year ended on Sep 30, 2018.
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PNB raised equity of around Rs 5,000 crores from institutional investors in Dec’17. Earlier this year
(FY 2018-19), PNB received Rs. 2,816 crs as a part of the government’s bank recapitalization plan.
The Bank board has approved proposal to seek capital support of Rs. 5,431 crs from the government.
Muthoot Capital Services Limited (CRISIL A1)
Muthoot Capital Services Ltd (MCSL), established in 1994, is an NBFC promoted by the Muthoot
Pappachan Group (MPG).
MCSL mainly provides vehicle loans and loans against consumer durables.
Capitalisation of MCSL has improved. The company raised Rs 165 crores equity via qualified
institutional placement in Nov’17.
Muthoot Pappachan Group is a 130-year old business group. MPG has diversified business interests
across sectors – financial services, hospitality, automotive, realty, IT services, healthcare, precious
metals, global services & alternate energy.
Sarvoday Advisory Services Pvt. Ltd. (BWR A(SO))
Sarvoday Advisory Services Pvt. Ltd. is owned by the Sajjan Jindal Family Trust.
Transaction structured as Loan Against Shares (LAS).
Transaction has a security cover of 2.00x in the form of pledge of listed shares of JSW Steel and JSW
Energy.
Bharti Telecom Ltd. (CRISIL A1+)
Bharti Telecom Ltd. (BTL) is promoted by Bharti group and Singtel, Singapore.
BTL holds ~50% shareholding of Bharti Airtel Limited (BAL) (June’18).
Market value of BTL’s holding in BAL is around Rs 62,659.25 crs (Nov 30, 2018) which provides financial
flexibility to the Company.
Future Lifestyle Fashions Ltd. (CRISIL AA-)
Future Lifestyle Fashions Limited (FLF), a part of Future Group, operates in fashion retail and
distribution and has pan-India presence.
FLF operates its retail outlets in three broad formats – Central (big-box fashion retailer), Brand Factory
(fashion discount chain) and Exclusive Brand Outlets (Planet Sports, etc.).
FLF owns a portfolio of both owned / licensed brands and has also invested in various investee brands.
It has 8 owned, 10 licensed and 13 investee brands.
Product-wise, FLF has 19 brands in the pure apparel category and 12 brands in non-apparel categories
like sports / active wear, footwear, accessories and others.
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Aarish Solar Power Ltd. / Aashman Energy Pvt. Ltd. / Divyesh Power Pvt. Ltd. / Elena Renewable Energy Pvt. Ltd. / Pratyash Renewable Pvt. Ltd. / SEI Baskara Power Pvt. Ltd. / SEI Enerstar Renewable Energy Pvt. Ltd. / SEI Mihir Energy Pvt. Ltd. / Zuvan Energy Pvt. Ltd. /Shreyas Renwable Energy Pvt. Ltd (CARE AA-(SO))
The above mentioned companies are SPVs of Greenko Group and involved in solar power generation.
Greenko is majorly owned by marquee investors such as GIC, Singapore and Abu Dhabi Investment
Authority.
Each SPV has set-up solar plant with capacity of 50MW each. Plants at all SPvs are operational,
supplying power to NTPC under a long term Power Purchase Agreement (PPA).
Exposure is further secured by Corporate Guarantee from Greenko Energies Pvt Ltd (one of the major
holding company for Greenko Group in India).
Adani Infra (India) Ltd: (BWR AA-(SO))
Adani Infra is a part of the Adani group of companies.
The NCDs are secured by 1.5x pledge of shares of Adani Ports & SEZ (market capitalization of ~Rs.
75,724.35 crs as on Nov 30,2018), 0.3x of Adani Enterprise (market capitalization of ~Rs. 18,146.87crs
as on Nov 30, 2018) and 0.2x of Adani Transmission Limited (market capitalization of ~Rs. 24,756.72
crs as on Nov 30, 2018).
Aspire Home Finance Corporation Ltd (ICRA A+)
Aspire Home Finance (AHF) is the housing finance arm of Motilal Group. AHF started its lending
operations in May 2014, primarily offering housing loans to individuals.
As on Mar 31, 2018 Motilal Oswal Financial Services Ltd (MOFSL), directly and indirectly, held 92%
stake in the company.
AHF has a track record of 4+ yrs. As on Mar 31, 2018 AHF had total loan book of ~Rs. 4,900 cr, 120
branches and ~1200 employees.
ASF is step-down subsidiary of MOFSL, one of India’s leading providers of Capital market related
services.
MOFSL and its subsidiaries are engaged in wealth management, broking services, structured lending,
margin financing and investment banking.
Ananta Landmarks Pvt Ltd (Unrated)
Ananta Landmarks Pvt Ltd (‘ALPL’) is a part of the Kalpataru Group, a leading real estate developer
based in Mumbai. ALPL was incorporated in January 2002.
Kalpataru Group, founded in 1969 by Mr. Mofatraj Munot, has a well-diversified presence in real
estate development, power generation, transmission & distribution projects, road-bridges, civil
contracting, plastic processing, office supplies, property management and international trading.
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In last 17 years, Kalpataru Group has completed 38 projects having saleable area of over 136 lakhs sq.
ft. in Mumbai, Thane & Pune and is in process of developing new 81 lacs sq. ft. in Mumbai, Thane,
Pune & Chennai.
Lending is to ALPL is secured against a parcel of land, with a minimum security cover of 1.75x and also
personal guarantee from Mr. Parag Munot (promoter of Kalpataru Group). The company has already
received approval for development of part of the land.
AU Small Finance Bank Ltd: (AA-/A1+ by CRISIL, ICRA, India Ratings and CARE)
Au Financiers Ltd. (AUF) is a Rajasthan-based small finance bank, operating primarily in CV finance
segment and LAP business. AUF has also set up a housing finance subsidiary.
AUF was set up by a first generation entrepreneur Sanjay Agarwal in 1986.
In 2003, AUF started generating portfolio for HDFC Bank as a channel partner.
In 2008, AUF received the first of its multiple private equity capital infusions. Subsequently, it started
originating portfolio on its own book and saw a rapid growth trajectory thereafter.
Asirvad Microfinance Pvt. Ltd. (CRISIL A+)
Asirvad Microfinance Pvt. Ltd. (AMPL) is an NBFC-MFI acquired by Manappuram Finance Ltd, which
held 92% stake in AMPL in April 2018.
In operation since Jan 2008; AMPL presently operates pan-India with a total of 832 branches (March
2018); 4,200 employees (March 2018); managed portfolio of Rs. 2,437 crs (March 2018).
AMPL was promoted by Mr. SV Rajavaidyanathan, an IIT-IIM alumnus and former President at
Reliance Retail Ltd, Chennai. He has ~30 years of experience in financial services. The other promoter
is his brother Mr. SV Krishnamurthy, a qualified CA and CS. He promoted a financial BPO that has now
been taken over by Sundaram Finance.
The Management comprises of professionals who have relevant experience and skills in Banking,
Microfinance, Finance and HR to carry out their responsibilities.
As at Mar 31, 2018 AMPL was held by Manappuram Finance (92%) & SV Rajavaidyanathan (8%)
Barclays Investments & Loans (INDIA) LTD. (ICRA AAA / A1+)
Barclays Investment & Loans (India) Ltd (BILIL) is wholly owned by Barclays group (57.84% held by
Barclays Bank Plc and 42.16% held by Barclays Mauritius Overseas Holdings Limited).
BILIL’s core business is provisions of Loans Against Security (LAS) and mainly caters to ultra HNIs and
commercial entities owned by these HNIs. These facilities are primarily offered to HNI and ultra-HNI
clients of Barclays Wealth.
The company provides loans against financial security only. Its credit facilities are specifically designed
to meet the clients’ need for liquidity support against financial assets such as - equity shares, mutual
fund units, bonds, debentures, etc. Most of these loans are short-term in nature
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Birla TMT Holding Pvt Ltd. (CRISIL A1+), TGS Investment & Trade Pvt Ltd. (ICRA A1+), Trapti Trading & Investments Pvt Ltd (ICRA A1+), Turquoise Investments and Finance Pvt Ltd (CRISIL A1+)
The above mentioned entities are promoter companies of Aditya Birla Group and hold stakes in listed
entities of Aditya Birla Group, which provides them strong financial flexibility. These NBFCs mainly
invests in shares and provide finance to listed and unlisted group entities. The entities are ultimately
owned by Mr. Kumar Mangalam Birla.
Bhopal Dhule Transmission Company Limited (CRISIL AAA)
BDTCL, a step-down subsidiary of Sterlite Power Transmission Limited was transferred to Sterlite
Group’s recently floated InvIT, India Grid (IndGrid) InvIT.
BDTCL is a power transmission project involving 8 elements, which include 6 transmission lines & 2
substations in the state of MP, Maharashtra & Gujarat. It has 765 kV S/C transmission lines of 891
circuit km (ckm) and 400 kV D/C lines of 53 ckm in Indore-Bhopal-Jabalpur region and Vadodara-
Dhule-Aurangabad region along with two substations at Bhopal and Dhule.
Project is implemented on Build, Own, Operate and Maintain (BOOM) basis and has a transmission
service agreement (TSA) in place for 25 years, extendable by 10 years.
Commission of the project was completed in June 2015 and has been operating at healthy average
line availability of above 99.50%.
Power Grid Corporation of India Ltd. (PGCIL) acts as the Central Transmission Utility (CTU) and is
responsible for billing, collecting transmission charges from the discom’s and distributing the same
among service providers.
Konti Infrapower & Multiventures Pvt. Ltd. / Edison Utility Works Pvt.Ltd. (Secured by Equity shares of Zee Ltd) (BWR A+(SO))
Both entities are entities held by Subhash Chandra & family, promoters of Zee Group.
Zee Entertainment Enterprises Ltd (ZEE), promoted by Subhash Chandra, is one of India’s leading
television, media and entertainment companies with a wide viewer base of over 959 million across
169 countries.
ZEE operates 33 domestic channels and delivers 39 international channels covering all genres of
entertainment.
As on November 30, 2018, promoters held 42% stake in ZEE Entertainment Enterprises, valued at Rs.
19,709.85 cr on a market cap of Rs.46,928.23 cr.
These NCDs are secured by pledge of shares of ZEE Entertainment Enterprises. We take comfort from
the reputation and track record of Essel Group in general and fundamentals, liquidity and
performance of ZEE shares.
Key Credit Brief
Page | 14
Dewan Housing Finance Corporation Ltd (CARE AAA/A1+)
DHFL, since 1984, primarily provides housing finance to individuals, especially to the low and lower-
middle-income groups in Tier-II and Tier-III cities. It also offers non-housing loans such as LAP and
developer loans.
Has a pan-India presence, with customer touch points in 444 locations.
The ratings reflect DHFL's strong market position in the housing finance segment, and its healthy asset
quality supported by high granularity in the underlying portfolio. It has a strong market position in the
mortgage finance segment as reflected in the significant scale achieved by the company over the past
few years.
DHFL is the third largest housing finance company with assets under management (AUM) of ~1,10,000
cr as on March 31, 2018. DHFL reported net profit of Rs. 1,172 crs in FY18 v/s PAT of Rs. 2,896 cr for
FY17.
In FY17, Board of DHFL had approved the sale of investments in DHFL Pramerica Insurance Company
Ltd (DPLI) to its wholly owned subsidiary DHFL Investments Limited. This transaction resulted in a
gain of Rs. 1,969 crs to DHFL in FY17.
Dalmia Cement Bharat Ltd (ICRA AA/A1+)
DCBL is the cement-business holding company of the Dalmia group. In last 5 yrs, DCBL has enhanced
capacities by way of brownfield and greenfield expansion and Dalmia group has accelerated its growth
through strategic acquisitions.
DCBL holds 75% stake in OCL India Ltd, a major cement player in eastern India with a capacity of 6.7
MT.
DCBL has established its North-East footprint by acquiring 3 cement plants - Calcom Cement, Adhunik
Cement and JP Bokaro Cement resulting in DCBL’s total capacity rising to ~24 MT, making it the 3rd
largest cement group in India.
With a strong presence and robust market share in South and NE India, DCBL company benefits from
an established management, strong operating efficiencies, established brand and caters to the
relatively attractive cement markets of Tamil Nadu and Kerala. In TN and Kerela, DCBL enjoys
relatively higher capacity utilization, realization and operating profit per tonne of cement sold as
compared to cement companies located in AP and Karnataka.
The NCDs are secured by first exclusive charge on 51% shares of OCL India.
ECL Finance Ltd (ICRA AA, CRISIL A1+)
ECL Finance Ltd (ECLF), an NBFC along with Edelweiss Housing Finance Ltd is the primary lending arm
of the Edelweiss group.
ECLF offers collateralized loans to corporates and promoters, initial public offering financing and
employee stock option plan financing as well as SME loans and loans against property.
Key Credit Brief
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Edelweiss Agri Value Chain Limited (CARE AA(SO)) Edelweiss Agri Value Chain Limited (EAVCL) is an Agri Value Chain initiative, from the Edelweiss Group.
EAVCL is a step-down, wholly-owned subsidiary of flagship company Edelweiss Financial Services
Limited (EFSL).
EAVCL offers services spanning the entire agricultural supply chain viz., Procurement, Transport
Logistics, Storage, Quality Assaying and Certification, Commodity Health Management, financing
through Banks/FIs, Disposal services etc.
EAVCL has 2 primary lines of activity – i) sourcing and storage of commodities, and ii) collateral and
warehouse management, in which EAVCL holds client stocks and facilitates financing through partner
banks against these stored commodities.
East-North Interconnection Company Limited (CRISIL AAA(SO))
East North Interconnection Company Ltd. (ENICL), a 96.2% step-down subsidiary of Sterlite
Technologies, is the developer of 2400 kV double circuit power transmission lines connecting Assam
with West Bengal & Bihar.
Project is developed on BOOM (Build, Own Operate & Maintain) basis, wherein ENICL is designated
as the Interstate Transmission System (ISTS) Licensee.
ENICL has entered into Transmission Service Agreement (TSA) with Power Grid Corporation of India
Ltd. (PGCIL), which is valid for 25 years from date of order i.e. 28th October 2010 to 28th October,
2035.
PGCIL is acting as the Central Transmission Utility (CTU) and responsible for billing, collecting
transmission charges from the discom’s and distributing the same among ISTS Licensee
The project, consisting only of transmission lines, has high reliability and low maintenance complexity,
given the well-established technology and long design life of such assets. The useful life of
transmission assets is at least 35 years.
Tariff payments to the project are linked only to availability of the assets and not with quantum of
power flow, thus avoiding any volume risk based on transmission line utilization. In fact, the
availability of Power Grid Corporation India Limited’s (PGCIL) assets across the country has remained
above 99% in the last six years which demonstrates the well-established design/technology of
transmission projects.
Given that the project is effectively ring-fenced from sponsor and requires minimal sponsor support
during its life, credit profile is independent of that of the sponsor.
Key Credit Brief
Page | 16
Essel Lucknow Raibareli Toll Roads Limited: (CARE AAA)
Essel Lucknow Raebareli Toll Roads Limited (“ELRTRL” or “the Company”) is a SPV owned 100% by
Essel Group.
ELRTRL has implemented and is currently operating a four lane Lucknow – Raebareli section of
National Highway no. 24B (NH–24B) from 12.70km to 82.70km (design length 70km) in the state of
Uttar Pradesh.
The project was awarded by National Highways Authority of India (NHAI) to the company under
competitive bidding process on design, build, and finance, operate and transfer basis.
NHAI will pay semi-annual annuity of Rs. 50.4 Crs over the concession period of 17 years. The Company
has started receiving annuity from 21 July 2015.
Fullerton India Credit Co. Ltd: (CARE AAA, ICRA A1+)
Fullerton India Credit Company Limited (FICCL) is a step-down subsidiary of Temasek Holdings (an
entity held by Govt of Singapore).
FICCL commenced its operations in January 2006 catering primarily to self-employed borrowers.
Over the last few years, FICCL shifted its focus towards secured lending in retail mortgages, rural
lending and SME while moving away from low income segment, which is perceived to be more
vulnerable to economic shocks.
HPCL Mittal Energy Ltd. (HMEL) and HPCL Mittal Pipelines (ICRA AA)
HMEL was incorporated in 2000 as a JV between HPCL Ltd and Mittal Energy investments Pte Ltd.
HMEL has commercially commissioned a green field refinery complex with 11.3 mmtpa capacity at
Bhatinda (Punjab, in north India) along with a captive power plant of 165 MV.
To meet the crude receipt & storage facilities as well as to transport the crude for the company, its
wholly owned subsidiary HPCL-Mittal Pipelines Ltd (HMPL) has set up a Crude oil terminal (COT) and
Single Point Mooring (SPM) at Mundra Port and a cross-country pipeline for transportation of crude
oil from Mundra to Bathinda.
The majority shareholders i.e. HPCL and Mittal Investments both hold ~49% stake with SBI and HDFC
Life holding ~1% each.
HMEL is managed by a board comprising of 3 directors from HPCL, 3 from the Mittal group and 2
independent directors. Sponsors have committed to maintain minimum 51% shareholding on joint
basis to lenders.
HMEL’s Refinery, with Nelson Complexity Index of 12.6, has the capability to process heavy crude and
produce high value petrochemical products. The products of the refinery meet Euro-III/IV norms.
The refinery is located in North India, where supply of petroleum products is lower than demand.
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Page | 17
HPCL currently transports products from refineries located in coastal areas in West and South India.
As an inland refinery, the company commands inland premium for its products.
Igarashi Motors Sales Pvt. Ltd. (IMSPL) (ICRA AAA(SO))
IMSPL was promoted as a joint venture by erstwhile Agile Electric Drives Technologies and Holdings
Pvt Ltd (which was amalgamated with Agile Electric Sub Assembly Pvt Ltd (AESPL) in 2011) and ABV
Engineers and Consultants Private Limited (ABV).
On May 11, 2017, Mr. P Mukund, acquired 100% stake of IMSPL from AESPL and ABV. Mr. Mukund is
the Managing Director of Igarashi Motors India Limited.
Transaction carries a credit enhancement provided by Axis Capital Ltd by way of an unconditional and
irrevocable underwriting commitment on the NCDs, making the NCDs an obligation of Axis Capital.
Axis Capital Ltd (earlier known as Axis Securities and Sales Ltd) is a 100% subsidiary of Axis Bank Ltd
and is in the business of providing investment banking and capital market services.
IIFL Wealth Finance Ltd (IWFL) (ICRA AA/A1+)
IWFL, is a newly acquired entity of the IIFL Group, and a 100% subsidiary of IIFL Wealth Management
Limited (IWML).
IWFL is operated as the lending vehicle for the Wealth business of the IIFL Group, with the key
products being loan against securities and margin funding for existing customers of the Wealth
business. IWFL forms the wealth management and distribution arm of the IIFL Group.
IIFL Holdings Limited holds a majority stake of 53.86% in IIFL Wealth Management Limited as on March
07, 2016 (on fully diluted basis i.e. after considering the proposed conversion of warrants and stock
options issued). General Atlantic has recently, taken a stake of 21.61% in IIFL Wealth (on fully diluted
basis), with the balance being held by IIFL Wealth Management employees.
India Infoline Finance Ltd (CRISIL AA-/A1+)
India Infoline Finance Ltd is a majority owned (98.86%) subsidiary of IIFL Holdings Ltd (market
capitalization of Rs. 15,048.68 cr as on Nov 30, 2018.), which is the holding company of the India
Infoline group
India Infoline Finance Ltd is the NBFC arm of the group and gives loans against gold, real estate, CV,
medical equipment and margin funding.
Indostar Capital Finance (CARE AA-)
Indostar Capital Finance (ICF) started its full-fledged operations in Aug 2012 and is engaged in the
business of secured wholesale funding with products ranging from corporate finance, capital market
funding to property finance and acquisition funding.
ICF is sponsored by three private equity funds - Goldman Sachs, Ashmore Group and Everstone
Capital. The sponsors infused core equity of 900 crores at inception, making it one of the best
capitalized and least leveraged NBFC in the market.
Key Credit Brief
Page | 18
ICF has a policy of maintaining adequate liquidity on balance sheet and does not do unsecured
lending.
IOT Utkal Energy Services Ltd (CRISIL AAA(SO))
IOTUL is a SPV which has set up crude and product storage tanks on Build-Own-Operate-Transfer
(BOOT) basis for Indian Oil Corporation’s Paradip refinery in Orissa.
IOTUL achieved successful completion and deemed commissioning of crude oil tankages in October
2013. The total project cost incurred for the construction of the facility was Rs.3,553 crore and the
BOOT period is 15 years from COD (up to October 2028).
The rating reflects the criticality of IOTUL’s facilities and the strong credit quality of its sole
counterparty – IOC (rated AAA / A1+ by Crisil).
IOTUL’s crude and product storage tanks facility will play a critical role in the operations of IOC’s
Paradip refinery. IOTUL will also benefit from the fixed cash flows arising from its contractual
agreement with IOC.
Jana Small Finance Bank Ltd (ICRA BBB)
Jana Small Finance Bank Ltd. (JSFB, erstwhile Janalakshmi Financial Services Private Ltd) received its
final license from RBI in March 2018, which permitted it to commence operations as a small finance
bank.
The exposure to JFSB is secured by exclusive charge on specific current receivables to the tune of 1.1x.
Company has raised fresh capital of Rs 1,636 crores since Nov 2016 and a large part of the equity has
gone towards meeting credit losses / provisioning.
Karelides Traders Private Limited (ICRA AA-(SO))
NCDs issued by Karelides Traders Pvt Ltd. will be backed by a letter of undertaking issued by Piramal
Fund Management Pvt Ltd (PFMPL), a wholly owned subsidiary of Piramal Enterprises Ltd.
The letter of undertaking is strongly worded and will be in the form of an unconditional and
irrevocable undertaking from PFMPL to arrange funds to ensure that NCD investors are redeemed in
full and on maturity.
Manappuram Finance Ltd (CARE AA/ A1+)
Manappuram Finance (MFL) is a non-deposit-taking NBFC engaged in providing finance against
household gold ornaments.
The company is promoted by Mr. VP Nandakumar, whose family has been engaged in the gold finance
business for more than 60 years and has strong presence in South India.
As on Oct 31, 2018 the company was operating through 4208 branches across 28 states.
MFL enjoys robust capitalization and stable, diverse funding sources. It had AUM of Rs. 16,618 crores
as on Jun 30, 2018 and net worth of Rs. 3,936 crores on Jun 30, 2018 (on standalone basis).
Key Credit Brief
Page | 19
For FY18, it reported PAT of Rs. 700 cr (v/s Rs. 726 cr YOY). For 3MFY19, the company had reported
PAT of Rs. 172 crs.
Muthoot Fincorp Ltd. (CRISIL A/ BWR A+)
MFL, set up in 1997, is a non-deposit-taking, systemically important NBFC engaged in lending against
gold.
It is the flagship company of the Muthoot Pappachan group, which has diverse business interests,
such as hospitality, real estate, and power generation.
The company also distributes mutual funds, and general and life insurance products, and operates in
the money-transfer segment. MFL operates out of 3,700 branches across India.
Nabha Power Ltd (ICRA AAA(SO), CRISIL A1+)
Nabha is a 100% indirect subsidiary of Larsen & Toubro. Nabha was awarded a project by Punjab State
Electricity Board (PSEB) to develop 1400 megawatt super critical coal-based thermal power project in
Rajpura (Punjab). Nabha has in turn contracted a 25-year power purchase agreement with Punjab
State Power Corporation Ltd (PSPCL).
The rating is based on unconditional and irrevocable guarantee from Nabha’s ultimate parent, Larsen
and Toubro Ltd, effectively making this an L&T obligation.
Nuvoco Vistas Corporation Ltd (CRISIL AA)
Nuvoco Vistas Corporation Ltd is a 100% subsidiary of Nirma. Nuvoco Vistas Corporation was created
with the merger of Nirma’s SPV Nirchem (which was floated to acquire Lafarge India) and Lafarge
India.
Nuvoco has plants in Searles Valley (United States), and in Gujarat and Rajasthan in India. It has set
up a cement plant in Pali with a capacity of 2.28 million tonne per annum (mtpa), which began
operations in November 2014.
Nirma was set up in 1980 by Dr Karsanbhai K Patel to manufacture detergents, and is a privately held
company operations to soaps, chemicals, allied products, and also processing minerals.
Nirma is a privately held company with shareholding by Patel family. Nirma has healthy market
position in domestic soda ash and soaps and detergent businesses supported by high backward
integration.
Lafarge is a regional cement manufacturer, with an installed capacity of about 10.8 mtpa as on March
31, 2016. Lafarge has strong operating efficiency and established market position in cement. The
acquisition of Lafarge will provide diversity in business risk profile and geographical presence for
Nirma.
Jamnagar Utilities & Power Pvt Ltd: (CRISIL AAA)
Jamnagar Utilities & Power Pvt. Ltd. (owned by promoters of Reliance Industries Ltd. – RIL) has set up
power plants for RIL and also operates them.
Key Credit Brief
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These plants are at Jamnagar (both in domestic tariff area and special economic zone) and Hazira with
combined capacity of 1116 MW of power and 4490 tonnes per hour of steam.
Powergrid Vizag Transmission Ltd. (PVTL) (CRISIL AAA(SO))
PVTL was incorporated as a Project SPV in November 2011, and subsequently acquired by PGCIL in
August 2013, after it emerged as the successful bidder in the exercise conducted by REC Transmission
Project Company Limited (the Bid Process Coordinator), pursuant to the guidelines of Tariff Based
Competitive Bidding (TBCB).
PVTL is establishing the project on Build, Own, Operate and Maintain (BOOM) basis. Transmission
License has been granted to PVTL in January 2014, and transmission charges were adopted by the
CERC in the same month.
The exposure is backed by an unconditional and irrevocable guarantee of Powergrid Corporation of
India (PGCIL).
Prestige Estates Projects Ltd (ICRA A+)
Prestige Estates Projects Ltd (PEPL) is the flagship company of Prestige Group with a market
capitalization of Rs. 8,120.63 crs (as on Nov 30, 2018).
Established in 1986 and currently headed by Mr. Irfan Razack - Chairman & Managing Director,
Prestige has over 28 years of experience in real estate development and is one of the leading real
estate developers in South India.
Has developed a diversified portfolio of real estate projects focusing on residential (apartments, villas,
plotted developments and integrated townships), commercial (corporate office blocks, built-to-suit
facilities, technology parks and campuses and SEZs), hospitality (including hotels, resorts, spas and
serviced apartments) and retail (including shopping malls) segments of the real estate industry.
Prestige also holds sizeable land parcels of more than 300 acres in Bangalore and other cities.
The transaction involves mortgage on the unsold identified residential units in four under construction
properties of PEPL such that the security cover of at least 1.5x is maintained at all times during the
tenure of the NCDs.
All sale proceeds from the said projects will be deposited in the escrow account and will be available
to investors for prepayment.
70% of sales have already been achieved in the four projects on a combined basis, thereby significantly
reducing pricing and sales risk.
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S D Corporation Private Limited (backed by unconditional and irrevocable guarantee of Shapoorji Pallonji & Co Pvt Ltd – DSRA guarantee for NCD and corporate guarantee for CPs) (CARE AA(SO))
S. D. Corporation Private Limited (SDCPL), a JV between the Shapoorji Pallonji Group and the Dilip
Thacker Group is engaged in real estate development. Its operations are largely concentrated in
Mumbai.
The guarantor, Shapoorji Pallonji and Company Private Limited (SPCPL) is the flagship company of the
Shapoorji Pallonji Group.
SP Group is a consortium of companies held by the Mistry Family and has diversified businesses across
sectors like construction, water purification, infrastructure development, etc.
Shapoorji Pallonji & Co. Pvt Ltd (SPCPL) is one of India’s leading construction companies and has a
legacy of almost 150 years. It has built diverse civil and engineering structures; executed some major
notable commercial construction projects around the country.
The SP Group is also the largest private shareholder (with an 18.37% stake) in Tata Sons Limited, the
holding company of the Tata Group.
SPCPL, which is held by Mr. Shapoor Mistry and Mr. Cyrus Mistry through various group companies,
functions as the holding-cum-operating company of the SP Group.
Sahyadri Agencies Ltd. (BWR A(SO))
Sahyadri Agencies is held by the promoter of Jyothy Labs, Mr. M P Ramchandran.
The promoter holds ~67% stake in Jyothy Labs (valued at Rs. 4,523.73 crs on a market cap of Rs. 6,751
crs as on Nov 30, 2018). These NCDs are in the nature of promoter funding, secured by pledge of
shares of Jyothy Laboratories Ltd (minimum cover of 2x) and personal guarantee of promoter.
The structure derives credit comfort from several covenants – total debt of the promoter capped at
Rs. 400 crs or 30% of Jyothy Labs market value, whichever is lower and all cash flows received in the
form of dividends, cash, bonus debentures etc shall be utilized towards repayment/prepayment of
this debt.
We draw comfort from the pledge provided by promoter, Jyothy’s 3 decade experience in FMCG and
its consistence performance, backed by steadily rising share prices since last 3-4 yrs.
SBK Properties Pvt. Ltd. (ICRA AA-)
SBK is an SPV which is wholly owned by the promoters of Kalyani Group.
Spearheaded by Mr. Baba Kalyani, Kalyani group is engaged in engineering & manufacturing of
automotives, industrials and engineering steel.
With end-to-end capability and manufacturing footprint across India, Germany, Sweden, & China, the
Group has an annual turnover of over Rs.12,000 crore and market capitalization of ~Rs.19,000 crore.
Key Credit Brief
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Bharat Forge Ltd. is the flagship company of the group with market cap of ~Rs. 26,251.18 crore (Nov
30, 2018) and the second largest forging company in the world.
NCDs are backed by unconditional, irrevocable and continuing guarantee by KSL Holdings Pvt. Ltd, one
of the principal holding entities of the Kalyani Group.
KSL holds 9.9% stake in Bharat Forge Ltd. and 11.6% in BF Utilities. The guarantee from KSL would
cover all obligations that may arise on the rated NCDs.
Shapoorji Pallonji Energy Gujarat Private Limited (backed by unconditional and irrevocable DSRA guarantee of Shapoorji Pallonji & Co Pvt Ltd) (ICRA AA-(SO))
Shapoorji Pallonji Energy (Gujarat) Private Limited (SPEGPL) is a wholly owned step-down subsidiary
of Shapoorji Pallonji & Company Private Limited.
SPEGPL has been incorporated to setup a 1320 MW (2 x 660 MW) thermal power plant in Phase-I,
based on supercritical technology near Kodinar in the Junagadh district of Gujarat.
The company plans to setup two additional 1320 MW (2 x 660 MW) capacity units at the same site in
Phase-II and Phase-III.
The company won the bid under Case-I competitive bidding in March 2010 to supply 800 MW to
Gujarat Urja Vikas Nigam Limited (GUVNL) and has subsequently entered into a PPA with GUVNL for
the same capacity for a period of 25 years.
The NCDs have an unconditional, irrevocable revolving DSRA guarantee from Shapoorji Pallonji & Co.
SP Jammu Udhampur Highways Ltd. (ICRA AAA(SO))
SP Jammu Udhampur Highway Limited (SPJUHI) is an SPV owned 100% by Shapoorji Group. It
undertook strengthening and four-laning of 64.58 km of Jammu to Udhampur on NH 1A on BOT and
annuity basis, with total project cost of ~Rs.2,200 cr.
The concession period is 20 years (ending Jun-2031) and semi-annual annuity is Rs.202 cr. SPJUHI
achieved COD in Jun 2014.
The structure incorporates, in addition to first charge over all toll receivables, a pledge of 51% of
equity shares of SPJUHI by promoters, with an undertaking that remaining 49% will not be sold or
otherwise transferred without prior approval of NCD holder, no further debt to be raised in the
project, minimum DSCR of 1.05X.
Most importantly, we derive comfort from an unconditional, irrevocable guarantee from Shapoorji
Pallonji Co. (flagship company of the group) to fund DSRA (next payment), further capex, and any
additional O&M/major maintenance or replacement costs, and to make good any annuity deduction
made by NHAI in case of inadequate availability of lanes and also in case of termination of project;
this effectively protects NCD holders from any additional cash outflow apart from those presently
accounted for
Key Credit Brief
Page | 23
The DSRA guarantee and all above undertakings will be unconditional and irrevocable as part of the
Promoter Support Agreement signed between the Sponsors and Debenture Trustee.
Suraksha Realty Ltd (CARE A1+(SO)); Suraksha Asset Reconstruction Co. Ltd (CARE A1+(SO))
Suraksha Realty and Suraksha Asset Reconstruction Co. are owned by the promoter group of Sun
Pharmaceutical Industries Ltd (rated AAA / A1+ by Crisil).
Established by Mr. Dilip Shanghvi in 1983, Sun Pharma today has a market capitalization of about
Rs.1,18,190.72 crs (as on Nov 30, 2018).
The transaction is structured as a loan against shares (LAS) with a security cover of 1.75 times and is
in the form of pledge of listed shares of Sun Pharma. The transaction has adequate safeguards and
covenants to protect the interests of the investor.
Tata Motors Finance Solutions (CRISIL AA, CARE A1+)
TMFS is a 100% subsidiary of Tata Motors Finance Ltd (TMFL).
TMFL has transferred its existing manufacturer-guaranteed and pre-owned vehicle financing
businesses (AUM of ~Rs.6,000 cr) to TMFS. Additionally TMFS will also engage in financing of
construction equipment manufactured by Tata-Hitachi.
We derive comfort from the strong business, financial, and managerial support and commitment
given by TMFL and Tata Motors Ltd to TMFS due to its high strategic importance. TMFS is expected to
receive significant support from Tata Motors.
TMFS will benefit from the representation of Tata Motors senior management on its board.
Additionally, both TMFL and TMFS will have a common managing director.
Tata Power Ltd. (CRISIL AA-, ICRA A1+)
The Tata Power Company Limited (Tata Power), a Tata Group company, is involved in the business of
generation, distribution and transmission of power. It has a license for bulk supply of electricity in the
city of Mumbai.
Tata Power Group currently has a total generation capacity of 8,613 MW on its own books as well as
its subsidiaries. Of the same, 2,027 MW capacity is utilized to meet the power demands in the License
Area in Mumbai. The company supplies power to Bombay Electric Supply & Transport Undertaking
(BEST).
Besides, it also supplies to the Railways and other industrial and High-Tension consumers in Mumbai
apart from direct sales to retail consumers in the License Area.
Tata Power operates the 4000 MW capacity as part of its Ultra Mega Power Project (UMPP) at Mundra
(project COD in March 2013), and the 1050 MW capacity in Maithon (project COD in July 2012)
through SPVs.
Key Credit Brief
Page | 24
The company also acquired 30% stake in coal mining companies (KPC and Arutmin, based in Indonesia)
and 26% stake in PT Baramulti Suksessarana Tbk (BSSR), Indonesia, in November 2012, through
offshore SPVs. In January 2014, the company however announced it had signed an agreement for sale
of its stake in PT Arutmin Indonesia.
Also, Tata Power has a power plant at Jojobera (428 MW) which supplies power to Tata Steel Ltd. Tata
Power also has an IPP in Haldia of 120 MW capacity out of which 100 MW capacity is sold on merchant
basis.
Further, the company has installed wind power plants of 461 MW as on date in the states of Gujarat,
Maharashtra, Tamil Nadu and Karnataka along with approx 58 MW solar projects commissioned in
Maharashtra and Gujarat.
U P Power Corporation Ltd (India Ratings AA (SO)/A+(SO))
U P Power Corporation Limited (“UPPCL” or “the Company”) is a power distribution company wholly
owned by the UP Government (GoUP). The Company has issued bonds, to fund its operations, under
the provisions of the UDAY (Ujwal DSICOM Assurance Yojana) agreement.
The Company has issued bonds under two structures.
Under the structure rated AA(SO), the bonds are secured by charge on receivables of UPPCL and also
have Reserve Bank of India-backed structured payment mechanism which will ensure timely servicing
of obligations on the bonds.
Under the structure rated A+(SO), the bonds are secured by charge on receivables of UPPCL and also
have a structured payment mechanism which involves charge on subsidy receivables from GoUP.
Both the structures have escrow mechanism wherein daily collections will be deposited into escrow
a/c which will be used for servicing of bonds. Further, these are secured by an unconditional and
irrevocable guarantee from Govt. of Uttar Pradesh.
Key Credit Brief
Page | 25
Alp
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arr
ange
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Credit Papers Kotak Banking
and PSU Debt Kotak Bond
Kotak Bond
Short Term Plan
Kotak Corporate
Bond Fund
Kotak Credit
Risk Fund
Kotak Dynamic
Bond Fund
Kotak Low
Duration Fund
Kotak Mahindra
Liquid Scheme
Kotak Medium
Term Fund
Kotak Money
Market Scheme
Kotak Savings
Fund
Aarish Solar Power Ltd.
Aasan Corporate Solutions Pvt. Ltd.
Aashman Energy Pvt. Ltd.
Adani Infra (India) Limited.
Altico Capital India Pvt Ltd
Ananta Landmarks Pvt Ltd.
Asirvad Microfinance Private Limited
AU Small Finance Bank Ltd.
Avendus Finance Pvt Ltd.
Bharti Telecom Ltd.
Bhopal Dhule Transmission Company Ltd.
Century Textiles & Industries Ltd.
Coastal Gujarat Power Ltd.
Dalmia Cement (Bharat) Ltd
Dewan Housing Finance Corporation Ltd.
Divyesh Power Pvt. Ltd.
East-North Interconnection Company Limited
ECL Finance Ltd.
Edelweiss Agri Value Chain Ltd.
Elena Renewable Energy Pvt. Ltd.
Essel Lucknow Raebareli Toll Roads Limited
Fullerton India Credit Co. Ltd.
Future Lifestyle Fashions Ltd.
Godrej Properties Limited
Green Infra Wind Energy Ltd.
HPCL Mittal Energy Ltd.
Igarashi Motors Sales Pvt. Ltd.
INCRED FINANCIAL SERVICES PRIVATE LIMITED
India Infoline Finance Limited
IOT Utkal Energy Services Ltd.
JAMNAGAR UTILITIES & POWER PRIVATE LIMITED
Jana Small Finance Bank Ltd.
Jyothy Fbricare Services Ltd.
Karelides Traders Pvt. Ltd.
Konti Infrapower & Multiventures Pvt. Ltd.
Manappuram Finance Ltd.
Muthoot Capital Services Ltd.
Muthoot Fincorp Ltd.
Nabha Power Ltd.
Nayara Energy Limited
Nuvoco Vistas Corporation Ltd.
Powergrid Vizag Transminssion Ltd.
Pratyash Renewable Pvt. Ltd.
Prestige Estates Projects Limited
Punjab National Bank
Rent A Device Trust
S D Corporation Pvt. Ltd.
Sahyadri Agencies Ltd
Sarvoday Advisory Services Pvt. Ltd.
SBK Properties Pvt Ltd.
SEI Baskara Power Pvt. Ltd.
SEI Enerstar Renewable Energy Pvt. Ltd.
SEI Mihir Energy Pvt. Ltd.
Shreyas Renwable Energy Pvt. Ltd.
SP Jammu Udhampur Highway Ltd.
Suhani Trading and Investment Consultants Pvt Ltd
Suraksha Realty Ltd.
TGS Investment & Trade Private Ltd.
Trapti Trading & Investments Private Limited
U P Power Corporation Ltd
Utkarsh Small Finance Bank Ltd.
Zuvan Energy Pvt. Ltd.
Select Statement of Holdings in our Fixed Income Funds as on 30th Nov 2018
Key Credit Brief
Page | 26
Disclaimers: The above disclosure on credit quality of the debt instruments is based on the information provided by rating agencies/respective companies. Few schemes of Kotak Mutual Fund have taken exposure in the debt instruments issued by above companies. In future, the Fund Manager at their discretion may or may not invest in the Debt instruments issued by above companies. Mutual Fund investments are subject to market risks, read all scheme related documents carefully.
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