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Key Credit Brief

Key Credit Brief

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Please click here to check the Holdings in our Fixed Income Funds or refer to page no 27

Sr no:

Credit Papers Ratings *Upgrade/ Downgrade

Page no.

(A) Kotak Credit Process 3

(B) New Credits taken in the month of August

1 Coastal Gujarat Power Ltd. (Guaranteed by Tata Power Co. Ltd ) CARE AA(SO) No change 4

2 JM Financial Asset Reconstruction Company ICRA AA-/A1+, CARE AA-/ A1+, CRISIL AA-/A1+

No change 4

Existing Credit

3 Altico Capital India Pvt Ltd IND AA- / ICRA A1+ No Change 5

4 Avendus Finance Pvt Ltd CRISIL A+ / A1+ No Change 5

5 Rent A Device Trust ICRA AAA(SO) No Change 5

6 Endurance Technologies Ltd CRISIL AA / A1+ No Change 6

7 Green Infra Wind Energy ICRA A1+/CRISIL A1+ No Change 6

8 Utkarsh Small Finance Bank ICRA A1 No Change 7

9 AASAN Corporate Solutions Private Limited ICRA AA- (SO) No Change 7

10 SVL Limited ICRA AA (SO) No Change 7

11 Visu Leasing and Finance Pvt. Ltd CARE A/A1 No Change 7

12 Bamnipal Steel IND A1+(SO) No Change 8

13 Indus Towers Limited CRISIL AA+/A1+ No Change 8

14 Azim Premji Trusts ICRA A1+ No Change 8

15 Manav Investment And Trading Co. Ltd ICRA AAA(SO) No Change 9

16 Jyothy Fabricare Services Limited CARE AA(SO) No Change 9

17 Suhani Trading and Investment Consultants Pvt Ltd BWR A+ (SO) No Change 9

18 Punjab National Bank

CARE AA- IND A+ BWR AA (Additional Tier1 Bonds)

No Change

10

19 Muthoot Capital Services Limited CRISIL A1 No change 10

20 Tata Communication Payment Solutions Ltd. CARE A1+(SO) No Change 10

21 Sarvoday Advisory Services Pvt. Ltd BWR A(SO) No change 10

22 Bharti Telecom Ltd CRISIL A1+ No change 11

23 Future Lifestyle Fashions Ltd CRISIL AA- No change 11

24

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

25 Adani Infra (India) Ltd BWR AA-(SO) No change 12

26 Aspire Home Finance Corporation Ltd ICRA A+ No change 12

27 Ananta Landmarks Pvt Ltd. Unrated No change 12

28 AU Small Finance Bank Ltd. CRISIL A+ No change 13

29 Asirvad Microfinance Pvt. Ltd CRISIL A+ No change 13

30 Barclays Investments & Loans (INDIA) LTD. ICRA AAA / A1+ No change 14

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*Upgrade/Downgrade change for the AUGUST month.

31 Bhopal Dhule Transmission Company Limited CRISIL AAA No change 14

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33

Birla TMT Holding Pvt Ltd, Turquoise Investments & Finance Pvt Ltd CRISIL A1+ No change 14

TGS Investment & Trade Pvt Ltd, Trapti Trading & Investments Pvt Ltd ICRA A1+ No change

34 Konti Infrapower & Multiventures PvtLtd/ Edison Utility Works Pvt.Ltd. BWR A+(SO) No change 14

35 Dewan Housing Finance Corp Ltd CARE AAA/A1+ No change 15

36 Dalmia Cement Bharat Ltd ICRA AA/A1+ No change 15

37 ECL Finance Ltd ICRA AA/CRISIL A1+ No change 15

38 East-North Interconnection Company Limited CRISIL AAA(SO) No change 16

39 Edelweiss Agri Value Chain Limited CARE AA(SO) No change 16

40 Essel Lucknow Raibareli Toll Roads Limited CARE AAA No change 17

41 Fullerton India Credit Co. Ltd. CARE AAA/ICRA A1+ No change 17

42 HPCL Mittal Energy Ltd. and HPCL Mittal Pipelines ICRA AA No change 17

43 Igarashi Motors Sales Pvt. Ltd . (IMSPL) ICRA AAA (SO) No change 18

44 IIFL Wealth Finance Ltd (IWFL) ICRA AA/A1+ No change 18

45 India Infoline Finance Ltd CRISIL AA/A1+ No change 19

46 Indostar Capital Finance Ltd CARE AA- No change 19

47 IOT Utkal Energy Services Ltd CRISIL AAA(SO) No change 19

48 Jana Small Finance Bank ICRA BBB No change 19

49 Karelides Traders Private Limited ICRA AA- (SO) No change 20

50 Manappuram Finance Ltd CARE AA/ A1+ No change 20

51 Muthoot Fincorp Ltd CRISIL A/BWR A+ No Change 20

52 Nabha Power Ltd ICRA AAA(SO)/ CRISIL A1+ No change 20

53 Nuvoco Vistas Corporation Ltd CRISIL AA No change 21

54 Jamnagar Utilities & Power Pvt Ltd CRISIL AAA No change 21

55 Powergrid Vizag Transmission Ltd. CRISIL AAA(SO) No change 21

56 Prestige Estates Projects Ltd ICRA A+ No change 22

57 S D Corporation Private Limited ( backed by unconditional and irrevocable DSRA guarantee of Shapoorji Pallonji & Co Pvt Ltd)

CARE AA+(SO) No change 22

58 Sahyadri Agencies Ltd. BWR A(SO) No change 23

59 SBK Properties Pvt. Ltd. ICRA AA- No change 23

60 Shapoorji Pallonji Energy Gujarat Private Ltd (backed by unconditional and irrevocable DSRA guarantee of Shapoorji Pallonji & Co Pvt Ltd )

ICRA AA(SO) No change 23

61

62 SP Jammu Udhampur Highways Ltd ICRA AAA(SO)) No change

24

63

Suraksha Realty Ltd CARE A1+(SO) No change

24

Suraksha Asset Reconstruction Co. Ltd

64 Tata Motors Finance Solutions CRISIL AA/ CARE A1+ No change 25

65 Tata Power Ltd. CRISIL AA-/ICRA A1+ No change 25

66 U P Power Corporation Ltd IND AA(SO)/A+(SO) No change 26

Holdings in our Fixed Income Funds as of 31st August 2018 27

Key Credit Brief

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Kotak Credit Process – Mitigating Risk through Robust Practices

Robust Credit Evaluation Process at Kotak MF

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New Credit taken in the month of August

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 Ind ‘AA’ by India Ratings.

Exposure on CGPL is guaranteed by unconditional and irrevocable guarantee of Tata Power (Rated

CARE ‘AA’)

Tata Power has consolidated turnover of Rs 29,000 cr with EBITDA margin of 22% and PAT margin of

9%.

Balance sheet structure of Tata Power is moderate with Net Debt/Equity of 2.5x

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

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Existing Credit

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’s main

focus, now, is 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.

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).

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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 company for its product portfolio. The Company began 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.

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).

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Utkarsh Small Finance Bank (ICRA A1)

Utkarsh Small Finance bank was one of the only 10 entities in India and the only one in north India

to have received Small finance bank license from RBI in 2017.

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 Govinda 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.

SVL Limited (ICRA AA(SO))

SVL Limited, erstwhile Shriram Industrial Holdings Limited, is the ultimate holding company of the

non-financial/manufacturing businesses of the Shriram Group.

The NCDs are secured by an unconditional and irrevocable guarantee from Shriram Transport

Finance Company Limited, which covers all amounts due under the NCD

Visu Leasing and Finance Pvt. Ltd (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

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(i) Personal Loans,

(ii) Home Loans,

(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 1,075 crores which is well diversified across products classes and

net worth was Rs 530 crores in Dec’17. The NBFC is well capitalized with Capital Adequacy ratio of

51.1% in Dec’17 which is much higher than RBI requirement of 15%.

Bamnipal Steel (India Ratings A1+(SO))

Tata Steel’s Acquisition financing vehicle for Bhushan Steel. All debt/CP is backed by a letter of

comfort issued by Tata Steel Ltd. The commercial paper is rated A1+ (SO).

Indus Towers Limited (CRISIL AA+/A1+)

Largest player, who owns and operates 28% of the telecom towers in India.

Incorporated in November 2007 under a JV between entities of Bharti Infratel Limited, Vodafone

India and Aditya Birla Telecom (Idea).

ITL has 1,22,962 towers in 15 circles around the country and handles ~60% of traffic in India (Dec 31,

2017).

ITL benefits from tenancy arrangements with its promoters, Bharti Airtel, Vodafone India, and Idea

Cellular, which control over 70% of the revenue market share in the telecom space.

Azim Premji Trusts (ICRA A1+, BWR A1+)

A discretionary trust, part of the promoter group of Wipro Limited, whose beneficiaries are - Azim

Premji Philanthropic Initiatives Private Limited & Azim Premji Foundation for Development.

APT, directly and indirectly, holds ~34% stake in Wipro Ltd. (Jan 2018) and is the endowment vehicle

for Premji Family’s philanthropic initiatives.

Trustee for APT - Azim Premji Trustee Company Private Limited.

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Manav Investment And Trading Co. Ltd (ICRA AAA(SO))

Holding company with investments in specific listed companies of the B.K. Birla Group. Promoter of

Kesoram Industries Limited; also classified as Promoter/Promoter Group in other Birla Group

companies – Grasim, Hindalco, Aditya Birla Capital, etc.

Exposure secured by charge (security cover of ~1.5x at present market value of security) on share

portfolio of various Birla Group Companies.

Credit enhancement provided by Axis Capital Ltd in the form of an unconditional and irrevocable

underwriting commitment on the NCDs.

Axis Capital Ltd – a 100% subsidiary of Axis Bank Ltd, provides investment banking and capital

market services.

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 0.35x 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.

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Punjab National Bank (CARE AA-, India Ratings A+, BWR AA for Additional Tier1 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).

PNB raised equity of around Rs 5,000 crores from institutional investors in Dec’17.

Will receive Rs. 5,473 crores of equity from GOI as a part of government’s bank re-capitalization

plan.

As on Mar 31, 2018 - Total capitalization of 9.20% with Common Equity (CET1) of 5.95%; substantial

distributable reserves (~Rs 15,033 crs); reported net loss of Rs 12,283 crores for the year ended on

Mar 31, 2018.

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. (Brickworks 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.

Tata Communication Payment Solutions Ltd. (CARE A1+(SO))

TCPSL (erstwhile Tata Communications Banking Infra Solutions Ltd.) is a wholly owned subsidiary of

Tata Communications Ltd.

Provides payment solutions services such as managed ATM services, managed hosted core banking

solutions, point of sale (POS) solutions, card issuance & management and financial inclusion

solutions to banks, enabling banks to focus on their core business processes.

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Transaction backed by Letter of Comfort from Tata Communications (Rated AA+/A1+ by CARE

Ratings).

Bharti Telecom Ltd. (CRISIL A1+)

Bharti Telecom Ltd. (BTL) is promoted by Bharti group and Singtel, Singapore.

BTL holds ~45% shareholding of Bharti Airtel Limited (BAL) (Sep’17).

Market value of BTL’s holding in BAL is around Rs 1,53,440 crores (Aug 31, 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.

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).

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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.

79,349 crs as on Aug 31 2018), 0.3x of Adani Enterprise (market capitalization of ~Rs. 24,773 crs as

on Aug 31 2018) and 0.2x of Adani Transmission Limited (market capitalization of ~Rs. 25,175 crs as

on Aug 31 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.

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.

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AU Small Finance Bank Ltd: (CRISIL A+)

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 90% stake in AMPL as on March 31, 2017.

In operation since Jan 2008; AMPL presently operates pan-India with a total of 832 branches (March

2018); 4200 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 (90.39%)& SV Rajavaidyanathan

(8.54%)

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 August 31, 2018, promoters held 43% stake in ZEE Entertainment Enterprises, valued at Rs.

20,648 cr on a market cap of Rs.48,018 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 | 15

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. (market cap of Rs. 6,733 crs Aug 31, 2018), 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.

Key Credit Brief

Page | 16

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.

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 | 17

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.

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Page | 18

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.

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.

Key Credit Brief

Page | 19

India Infoline Finance Ltd (CRISIL AA-/A1+)

India Infoline Finance Ltd is a majority owned (98.86%) subsidiary of IIFL Holdings Ltd, which is the

holding company of the India Infoline group (market capitalization of Rs. 24,495 cr as on Apr 30,

2018.

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.

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) has recently

commenced operations as a small finance bank after receipt final license from Reserve Bank of

India.

The exposure is secured by exclusive charge on specific current receivables to the tune of 1.1x.

Key Credit Brief

Page | 20

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 Aug 31, 2018 the company was operating through 3307 branches across 28 states.

MFL enjoys robust capitalization and stable, diverse funding sources. It had AUM of Rs. 12,463

crores and net worth of Rs. 3,936 crores on Jun 30, 2018 (on standalone basis).

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).

Key Credit Brief

Page | 21

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.

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).

Key Credit Brief

Page | 22

Prestige Estates Projects Ltd (ICRA A+)

Prestige Estates Projects Ltd (PEPL) is the flagship company of Prestige Group with a market

capitalization of Rs. 8,889 crs (as on Aug 31, 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.

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.

Key Credit Brief

Page | 23

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. 5,306 crs on a market cap of Rs. 7,919

crs as on Aug 31, 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.

Bharat Forge Ltd. is the flagship company of the group with market cap of ~Rs. 31,615 crore (Aug 31,

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.

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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

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.123,386 crs (as on Apr 12, 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.

Key Credit Brief

Page | 25

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.

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.

Key Credit Brief

Page | 26

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 | 27

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Key Credit Brief

Page | 28

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.