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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 21

Sr no: Credit Papers Ratings Page no.

Existing Credit

1 Bhopal Dhule Transmission Company Limited CRISIL AAA 3

2 Birla TMT Holding Pvt Ltd, Turquoise Investments and Finance Pvt Ltd CRISIL A1+

3 TGS Investment & Trade Pvt Ltd, Trapti Trading & Investments Pvt Ltd ICRA A1+

3 Barclays Investments & Loans ICRA AAA / A1+ 3

4 Varun Beverages Limited CRISIL AA- / A1+ 4

5 Ananta Landmarks Pvt Ltd. Unrated 4

6 Trends In Vogue Pvt Ltd ICRA AAA(SO) 5

7 U P Power Corporation Ltd IND AA(SO) 5

8 K Raheja IT Park (Hyderabad) Ltd. IND AAA(SO) 5

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

CARE AA+(SO)/A1+(SO)

6

10 Innovador Traders Pvt Ltd ( backed by unconditional and irrevocable undertaking by Piramal Fund Management Pvt Ltd)

ICRA AA-(SO) 6

11 Altico Capital India Private Limited IND AA-/A1+ 6

12 Adani Power Ltd BWR AA-(SO) 7

13 Adani Transmission Ltd IND AA+/A1 7

14 Asirvad Microfinance Pvt. Ltd CRISIL A+ 8

15 Aspire Home Finance Corporation Ltd ICRA AA- 8

16 AU Small Finance Bank Ltd. FITCH A+(IND) 8

17 Continental Drug Company Pvt Ltd / Edison Utility Works Pvt.Ltd. ( Secured by Equity shares of Zee Ltd )

BWR A+(SO) 9

18 Dalmia Cement Bharat Ltd ICRA AA/A1+ 9

19 Dewan Housing Finance Corp Ltd CARE AAA/A1+ 10

20 DLF Emporio Ltd CRISIL AA(SO) 10

21 East-North Interconnection Company Limited CRISIL AAA(SO) 10

22 ECL Finance Ltd CARE AA 9

23 Edelweiss Agri Value Chain Limited ICRA AA/A1+ 11

24 Essel Lucknow Raibareli Toll Roads Limited IND AAA(SO) 11

25 Ford Credit India Private Limited IND A1+ 12

26 Fullerton India Credit Co. Ltd. CARE AAA 13

27 HPCL Mittal Energy Ltd. and HPCL Mittal Pipelines ICRA AA 12

28 IIFL Wealth Finance Ltd (IWFL) ICRA AA/A1+ 13

29 India Infoline Finance Ltd CRISIL AA-/A1+ 13

30 Indostar Capital Finance Ltd CARE AA- 13

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31 Intime Properties Ltd. FITCH AAA(SO) 14

32 IOT Utkal Energy Services Ltd CRISIL AAA(SO) 14

33 Janalakshmi Financial Services ICRA A 14

34 Karelides Traders Private Limited ICRA AA- (SO) 15

35 Kolte-Patil Developers Limited CRISIL A+ 15

36 Manappuram Finance Ltd CARE AA/ A1+ 15

37 Mandava Holdings Pvt Ltd ICRA AAA 16

38 Muthoot Fincorp Ltd CRISIL A- 16

39 Nabha Power Ltd ICRA & CRISIL AAA(SO)

16

40 Nuvoco Vistas Corporation Ltd CRISIL AA 7

41 Powergrid Vizag Transmission Ltd. CRISIL AAA(SO) 16

42 Prestige Estates Projects Ltd ICRA A+ 17

43 Pune Solapur Expressways Pvt. Ltd. ICRA A(SO) 17

44 Reliance Utilities and Power Pvt. Ltd. CRISIL AAA 17

45 Sahyadri Agencies Ltd. BWR A(SO) 18

46 SBK Properties Pvt. Ltd. ICRA AA- 18

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

ICRA AA(SO) 18

48 Sneha Abasan Pvt Ltd/ Sneha Enclave Pvt Ltd / Emami Enclave Maker Pvt Ltd

BWR & IND AA-(SO)

19

49 SP Jammu Udhampur Highways Ltd ICRA AAA(SO)) 19

50 Suraksha Realty Ltd CARE A1+(SO) 20

51 Tata Motors Finance Solutions CRISIL AA/ CARE A1+

20

52 Tata Power Ltd. CRISIL AA-/ICRA A1+

20

53 Holdings in our Fixed Income Funds as of 31st July 2017 21

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New Credits taken in the month of July

In July month there was no new significant credit added to our Debt portfolio. Hence, we are sharing the latest available credit brief report (of the previous month).

Bhopal Dhule Transmission Company Limited (CRISIL AAA)

BDTCL was step-down subsidiary of Sterlite Power Transmission Limited and was transferred to

India Grid (IndGrid) InvIT, Sterlite Group’s recently floated 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. The project is implemented on Build, Own, Operate and

Maintain basis (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), is acting as the Central Transmission Utility (CTU)

and responsible for billing, collecting transmission charges from the discom’s and distributing the

same among service providers.

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 abovementioned 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.

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 it 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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Varun Beverages Limited (CRISIL AA- / A1+)

Varun Beverages Ltd. is the flagship company of R. K. Jaipuria group. It was set-up in 1995 to cater

to PepsiCo's bottling requirement. It is the largest third-party bottler and distributor for PepsiCo

in India and holds 47% of PepsiCo’s India business. The company sells the whole range of Pepsi

drinks with its products ranging from aerated drinks to juices to mineral water. The company

manufactures and distributes sweetened (soft drink) / non-sweetened (soda) aerated water

(~75%) and packaged drinking water / packaged juices (~25%).

It has 16 manufacturing units spread across India and has bottling operations outside India in

Nepal, Sri Lanka, Morocco, Zambia and Mozambique. The group benefits from economies of scale

derived from backward integration of operations - it has facilities to manufacture crown corks,

polyethylene terephthalate (PET) pre-forms, storage boxes, shrink wrap sheets, and plastic cap

closures.

VBL got listed on both NSE and BSE through an IPO in November 2016.

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 was founded in 1969 by Mr. Mofatraj Munot. The Group 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. During the last 17 years, Kalpataru Group has completed 38 projects having

saleable area of over 136 lakhs sq. ft. in Mumbai, Thane & Pune and is currently involved in

development of new 81 lacs sq. ft. in Mumbai, Thane, Pune & Chennai.

The lending is to ALPL is secured against a parcel of land and 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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Trends In Vogue Pvt Ltd (ICRA AAA(SO))

Trends In Vogue Pvt Ltd (TIVPL) is a group co. of CavinKare Pvt. Ltd (CKPL), an established player

in the domestic FMCG sector. CavinKare started out in the personal care segment with Chik &

Nyle herbal shampoo brand and over the years has diversified into other segments, such as foods,

beverages, and dairy, through the organic as well as inorganic route. TIVPL houses the salon

business of the promoters, launched in 2000. It has 250+ salons with presence in AP, Delhi,

Karnataka, Kerela, Odisha, Tamil Nadu and West Bengal, under owned/franchised model. The

lending is guaranteed by Axis Capital, and is backed by 33% share pledge of CKPL with a security

cover requirement of 2x at all times, 51% share pledge of TIVPL, post-dated cheques from the

issuer, personal guarantee of promoters and maintenance of a 3-month ISRA.

U P Power Corporation Ltd (India Ratings AA (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.

These bonds are secured by charge on receivables of UPPCL, guarantee from GoUP and also have

Reserve Bank of India-backed structured payment mechanism which will ensure timely servicing

of obligations on the bonds.

The obligations of the Company are also unconditionally and irrevocably guaranteed by the

GoUP.

K Raheja IT Park (Hyderabad) Ltd. (India Ratings AAA(SO))

K Raheja IT Park (Hyderabad) Limited (“KRIT” or “the Company” or “the Issuer”) is part of the K Raheja Corp Group, a Mumbai based real estate developer promoted by Chandru Raheja and a major player in the Indian real estate market. The Group has a presence in 5 major cities in India mainly Mumbai, Pune, Bangalore, Hyderabad and Goa with the construction of over 2,000 buildings. K Raheja Corp Group, has developed commercial office spaces / special economic zones (SEZs), premium residential / township developments, retail malls and hospitality real estate. It has a remarkable track record in the leasing and maintenance of such assets.

As of Jan 2017, KRIT was held by K Raheja Group (89%) and by Andhra Pradesh Industrial Infrastructure Corporation (APIIC) (11%). It has 11 commercial buildings with a saleable area of 2.61 million sf, spanning 48.4 acres. The issuer has developed these buildings and also maintains them. They are part of a larger development called Raheja Mindspace located in Madhapur, Hyderabad, an established IT/ITES and residential hub. There are over 42 corporate tenants occupying these 11 buildings. It provides both multitenant and built-to-suit facilities to companies. All the 11 commercial properties were developed during 2006 and 2009. The property has historically maintained a high level of occupancy. The occupancy level of the property in Jan 2017 was in excess of 99%. The funding is secured by underlying property.

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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)/A1+(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. The SP Group has a diversified businesses across sectors like construction, water purification, infrastructure development, etc. 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.

Innovador Traders Pvt Ltd ( backed by unconditional and irrevocable undertaking by Piramal Fund

Management Pvt Ltd) (ICRA AA-(SO))

We have invested in NCDs issued by Innovador Traders Pvt Ltd. Our NCDs are 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.

Altico Capital India Private Limited (India Ratings AA-/A1+)

The Company is ultimately owned by three private equity funds (Clearwater Capital Partners, Abu Dhabi Investment Council and Varde Partners) which have infused a combined capital of US$ 300 million.

Altico is primarily focused on lending to the real estate sector in India across Tier-1 cities which includes Mumbai, NCR, Chennai, Bangalore, Pune and Hyderabad.

The Company focuses on senior secured lending to mid-income residential projects across Tier-1 cities in India and provides medium term financing to real estate developers for multiple purposes.

The Company has strong net worth as its shareholders have invested US$ 300 million in the Company.

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Nuvoco Vistas Corporation Ltd (CRISIL AA )

Nuvoco Vistas Corporation Ltd is a 100% subsidiary of Nirma. Nuvoco Vistas Corporation is the

created with the merger of Nirma’s SPV ( Nirchem - which was floated to acquire Lafarge India_

and Lafarge India.

Nirma was set up in 1980 by Dr Karsanbhai K Patel to manufacture detergents, Nirma has

expanded operations to soaps, chemicals, allied products, and also processing minerals. It has

plants in Searles Valley (United States), Mehsana, Ahmedabad, Vadodara, Bhavnagar (Gujarat),

and Pali (Rajasthan). 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 is aslo 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.

Adani Power: (BWR AA-(SO))

Adani Power (APL) is the power generation vertical of the Adani group. In Feb 2017, APL had a

total operational capacity of 10,480 MW, comprising of 4620 MW - Mundra UMPP, Gujarat, 3300

MW – Tiroda, Maharashtra, 1320 MW – Kawai, Rajasthan, 1200 MW – Udupi, Karnataka, 40 MW

– Bitta, Gujarat. The company was in process of acquiring 600 MW in Korba, from Avantha group.

The NCDs are secured by 1.5x pledge of shares of Adani Ports & SEZ (market capitalization of

Rs.74,161 crs as on June 13 2017), 0.3x of Adani Enterprise and 0.2x of Adani Transmission

Limited.

Adani Transmission Ltd. (IND AA+/A1)

Adani Transmission Ltd. (ATL) is a holding company, created to house the transmission assets of

Adani group. ATL holds two step-down subsidiaries, namely Adani Transmission India Limited

(ATIL) and Maharashtra Eastern Grid Power Transmission Company Limited (MEGPTCL). ATIL

holds 3 transmission assets while MEGPTCL holds 1. All 4 transmission assets are operational. ATL

effectively operates the largest private sector transmission network in India, with more than 5,000

CKT (circuit kilometers).

Until the recent reorganization of Adani Group, ATL was held 100% by Adani Enterprises Ltd. Post

the reorganization, ATL is held 75% by promoters, 17% by FIIs, 3% by banks/FIs and rest by public

and has been recently listed (market capitalization of Rs. 12,362 cr as on June 13, 2017).

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Aspire Home Finance Corporation Ltd (ICRA AA-)

Aspire Home Finance (AHF), the housing finance arm of Motilal Group, started lending operations

in May 2014 primarily offering housing loans to individuals. It has a track record of 4 yrs and had

total assets of Rs.4,664 cr as on Mar 31, 2017, with 120 branches and over 500 employees. As on

March 31, 2016 Motilal Oswal Securities Ltd and Motilal Oswal Financial Services Ltd held 98%

stake in the company; 2.7% stake was held by CEO Anil Sachidanand (with a ~3% ESOP base due

to vest in next 2-3 yrs)

AU Small Finance Bank Ltd.: (FITCH A+(IND))

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. Subsequently, it started generating portfolio for HDFC Bank in 2003 as channel partner. In 2008, AUF received its first of its multiple private equity capital infusions subsequent to which it originated portfolio on its own book and started growing rapidly.

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, 2016. AMPL has been operating since Jan 2008; it presently operates in 17 states with a total of 771 branches. As at Mar-2016, it had an AUM of Rs.864 cr with FY16 net profit of Rs.24 cr.

AMPL was promoted by Mr SV Rajavaidyanathan, who is an IIT-IIM alumnus and was previously President at Reliance Retail Ltd, Chennai. He has ~30 years of experience in financial services. The other promoter is his brother Mr. SV Krishnamurthy who is a qualified chartered accountant and a company secretary. He promoted a financial BPO that has now been taken over by Sundaram Finance. The Management comprises of Professionals who have relevant experience in Banking, Microfinance, Finance and HR and has the necessary skills to carry out its responsibilities.

As at March 31, 2016 AMPL was held by Manappuram Finance (91%) and S.V. Raja Vaidyanathan (9%).

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Continental Drug Company 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 June 13, 2017, promoters held 43% stake in ZEE

Entertainment Enterprises, valued at Rs. 21,020 cr on a market cap of Rs.48,805 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.

Dalmia Cement Bharat Ltd (ICRA AA/A1+)

DCBL is the cement-business holding company of the Dalmia group. After successfully enhancing

capacities over the last five years by way of brownfield and greenfield expansion, the group has

accelerated its growth through strategic acquisitions. DCBL holds 75% stake in OCL India Ltd.

(market capitalization of Rs. 6,847 cr on June 13, 2017), a major cement player in the eastern

region with a capacity of 6.7 MT. DCBL has successfully established its footprint in North East by

acquiring three cement plants - Calcom Cement, Adhunik Cement and JP Bokaro Cement. As a

result, its cement capacity has risen to ~24 MT, making it the 3rd largest cement group in India.

DCBL has a strong market position in Southern and North East India with healthy market share in

both of these markets. The company benefits from an established management, strong operating

efficiencies, established brand and caters to the relatively attractive cement markets of Tamil

Nadu and Kerala, where it 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 (CARE AA)

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.

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Dewan Housing Finance Corp Ltd (CARE AAA/A1+)

Incorporated in 1984, DHFL primarily provides housing finance to individuals, especially to the low and lower-middle-income groups in Tier-II and Tier-III cities. The company also offers non-housing loans such as LAP and developer loans. DHFL 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. DHFL 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 ~90,000 cr. DHFL reported net profit of Rs. 2896 cr in FY17 v/s PAT of Rs.729 cr for FY16.

DLF Emporio Ltd (CRISIL AA(SO))

DLF Emporio mall is located in Vasant Kunj, South Delhi which is among the most affluent residential areas in Delhi and has leasable area of ~305,000 sq ft with 98% area leased out. Emporio mall has around 90 tenants and houses global luxury brands including Louis Vuitton, Christian Dior, Gucci, and Armani and prominent Indian designer brands like Sandeep Khosla and Rohit Bal. The top 10 tenants have been occupants for 2-3 years, and lease agreements are drawn for 9 years with rent escalations of 15% every 3 years; the top 10 tenants constitute 40% of the lease rentals of DLF Emporio. The mail has been operational for more than 5 years. The property has been valued at Rs.1,076 crs by Cushman and Wakefield, providing a security cover of 2x on our investment.

The CMBS structure derives strength from the quality of the underlying properties, comfortable interest service coverage, liquidity support, and the structural features of the instrument.

East-North Interconnection Company Limited: (AAA(SO))

East North Interconnection Company Ltd.(ENICL), a 96.2% step-down subsidiary of

SterliteTechnologies, is the developer of 2 400 kV double circuit power transmission lines

connecting the states of Assam with West Bengal & Bihar. The 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.

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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.

Edelweiss Agri Value Chain Limited: (ICRA AA/A1+)

Edelweiss Agri Value Chain Limited (EAVCL) is an Agri Value Chain initiative, from the Edelweiss

Group. It is a step-down wholly owned subsidiary of flagship company Edelweiss Financial Services

Limited (EFSL). EAVCL is offering our valued services in the entire 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, sourcing

and storage of commodities, and collateral and warehouse management, in which EAVCL holds

client stocks and facilitates financing through partner banks against these stored commodities.

Essel Lucknow Raibareli Toll Roads Limited - IND AAA(SO)

Essel Lucknow Raebareli Toll Roads Limited (“ELRTRL” or “the Company”) is a SPV owned 100% by

Essel Group. It has implemented and 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, 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.

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Ford Credit India Private Limited (India Ratings A1+)

Ford Credit India Private Limited is a fully owned subsidiary of Ford Motor Credit Company through Ford Credit International, Ford Motor Company’s global financing subsidiary. As a captive finance company, FCIPL provides loans and financial services to dealers and retail customer for the purchase of vehicles manufactured by Ford India Private Limited (FIPL). The company is systematically important, non-deposit taking NBFC.

FCIPL launched wholesale operations in March 2015 and retail operations in September 2015. FCIPL supports synergies with automotive company. It also provides floor plan financing to FIPL dealers. FCIPL has been established using Ford Credit’s global systems, processes and procedures.

The Company is rated as A1+ by India Ratings. The rating is driven by India Rating’s expectation of strong support from FCIPL’s parent– Ford Motor Credit Company and the ultimate parent- Ford Motor Company. The rating factors in FCIPL’s strong operational and business synergies within the group’s automobile businesses, management control by the parent, and sharing of the common Ford brand name.

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 ie 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 directs 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. 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.

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Fullerton India Credit Co. Ltd. (CARE AAA)

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.

IIFL Wealth Finance Ltd (IWFL) (ICRA AA/A1+)

IWFL, is a newly acquired entity of the IIFL Group, and is 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. Earlier, this lending book was based in IIFL, the NBFC of the

group, and would be transferred to IWFL, in a phased manner in the next 6 months, with

incremental business booked out of IWFL itself.

IWFL forms the wealth management and distribution arm of the IIFL Group. IIFL Holdings Limited

holds the 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, which is the holding company of the India Infoline group (market capitalization of Rs.19,200 cr as on June 13, 2017). 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.

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Intime Properties Ltd. (FITCH AAA(SO))

Intime Properties Ltd (Intime) is part of the K Raheja Group, a Mumbai based real estate developer

promoted by Chandru Raheja and a major player in the Indian real estate market. The Group has

a presence in 5 major cities in India mainly Mumbai, Pune, Bangalore, Hyderabad and Goa with

the construction of over 2,200 buildings.

Intime is held 89% by K Raheja Group and 11% by Andhra Pradesh Industrial Infrastructure Corporation. The Group, through Intime, has developed Mindspace Cyberabad – an IT/ ITeS focused integrated development at Madhapur near HITEC city. The current transaction is a CMBS structure (partially amortizing) against 3 specific buildings (spread over 8.52 acres with 17.14 lakh sq.ft. leasable area) in Mindspace Cyberabad, which are 99% leased out with more than 35 premium corporate tenants such as Novartis, Continuum Solutions, HSBC etc.

In addition to collateral of specified land & buildings (current security cover of 2.3X), the structure incorporates exclusive charge on rent received (for debt servicing) and also performance-based triggers:

o Quarterly weighted average base rent drops below Rs.30 p.m.per sq.ft.

o Quarterly average occupancy level falls below 85%

o Security cover falls below 2X

In case any of these events are triggered, all excess rent receivables after debt servicing

will be trapped and cannot be withdrawn by issuer.

IOT Utkal Energy Services Ltd (CRISIL AAA(SO)

IOTUL is a special purpose vehicle 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.3553 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.

Janalakshmi Financial Services (ICRA A)

Janalakshmi Financial Services Private Ltd (JFS) is a Bangalore-based NBFC-MFI catering to the

financial needs of urban poor women through the Joint Liability Mechanism. JFS was founded in

2006 by Mr. Ramesh Ramanathan as Janalakshmi Social Services (JSS), the portfolio of which was

taken over by JFS in 2008. The promoter shareholding continues to be in Jana Urban Foundation-

JUF (a non-profit company) and funds in JUF are used to address social issues.

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

Apart from the security, the structure incorporates various covenants based on leverage, asset

quality, capital adequacy and management commitment which provide significant credit comfort.

JFS has received Small Finance Bank (SFB) License from RBI in Oct 2015 and it will begin banking

operations latest by Q2FY18.

Karelides Traders Private Limited (ICRA AA- (SO))

We have invested in NCDs issued by Innovador Traders Pvt Ltd. Our NCDs 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.

Kolte-Patil Developers Limited (CRISIL A+)

KPDL, incorporated in 1989, is promoted by Mr. Rajesh Patil, along with his brother, Mr. Naresh Patil, and brother-in-law, Mr. Milind Kolte.

KPDL, along with its subsidiaries and associate companies, is one of the largest residential real estate developers in Pune. It enjoys 8-11% market share in Pune real estate market. The company has a healthy project portfolio across residential segments and is expanding its presence in the Bengaluru and Mumbai markets. As of March-16, the company has executed over 10 million square feet (msf) of projects and has 20 msf of projects under construction in the residential real estate segment.

Manappuram Finance Ltd (CARE AA/ A1+)

Manappuram Finance 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 with 3,293 branches at March 2017 end.

Manappuram enjoys robust capitalisation and stable, diverse funding sources.

Manappuram Finance had AUM of Rs. 13,650 crores and networth of Rs. 3,360 crores at March

31, 2017. For FY17, it reported PAT of Rs. 726 cr (v/s Rs. 337 cr YOY).

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Mandava Holdings Pvt Ltd (ICRA AAA)

Mandava Holdings (MHPL) is the holding company of Nuziveedu Seeds Ltd., the flagship company of the group and the largest private sector seed company in India. The group has been an established player in the hybrid seeds business for more than 30 years. Apart from this, the group also has interest in power, textiles, sugar and infrastructure.

The 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.

Muthoot Fincorp Ltd. (CRISIL 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 had an advance book of ~Rs.9,000 cr as on March 2016 of which Rs.1,500

cr is Microfinance JLG loans. MFL operates out of 3,700 branches across India.

Nabha Power Ltd (ICRA & CRISIL AAA(SO))

Nabha is a 100% indirect subsidiary of Larsen & Toubro. Nabha was awarded the 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.

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).

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Reliance Utilities and Power Pvt. Ltd. (RUPPL): (CRISIL AAA)

RUPPL (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.

Prestige Estates Projects Ltd (ICRA A+)

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

capitalization of Rs. 9,538 crs (as on June 13, 2017), which was established in 1986 and is 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. It 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.

Pune Solapur Expressways Pvt. Ltd. (ICRA A(SO))

Pune Solapur Expressways Pvt. Ltd. (PSEPL) is an SPV promoted in 2009 as a 50:50 JV by TRPL

Roads Pvt Ltd (a 100% subsidiary of TRIL, which is in turn a 100% subsidiary of Tata Sons) and

Atlantia (an Italian road developer, rated A- by Fitch global). PSEPL has been set up for developing

and managing the project for 4 laning of Pune Solapur section of NH 9 for 117 km (incl bypass) in

Maharashtra under NHDP III on BOT basis for concession period of 21 yrs from appointment date

of Nov 2009 i.e. Nov 2030.

The structure has various reserve accounts exclusively charged to NCD holders which provides

adequate buffer in case of volatile cash flows from toll. A controlling 51% stake in the SPV is also

pledged to NCD holders.

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Sahyadri Agencies Ltd. (BWR A(SO))

Sahyadri Agencies is an entity held by the promoter of Jyothy Labs, Mr M P Ramchandran. The

promoter holds ~67% stake in Jyothy Labs (valued at Rs.4,695 crs on a market cap of Rs.7,018 crs

as on June 13, 2017). 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.17,000 crore 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.

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Sneha Abasan Pvt Ltd/ Sneha Enclave Pvt Ltd / Emami Enclave Maker Pvt Ltd : (BWR & IND AA-(SO))

Sneha Abasan Pvt Ltd/ Sneha Enclave Pvt Ltd / Emami Enclave Maker Pvt Ltd. are entities owned

by the promoters of Emami Ltd, RS Agarwal and RS Goenka. Emami is one of India’s leading FMCG

companies engaged in manufacturing & marketing of personal care & healthcare products.

Emami’s portfolio includes trusted power brands like Zandu, Boroplus, Navratna, Fair &

Handsome, Mentho Plus, Fast Relief and Sona Chandi Chyawanprash. Emami has market

capitalization of ~Rs.25,500 crs and the promoters hold 72.74% stake in Emami Ltd.

The structure consists of a 1.6x pledge over shares of Emami Ltd and protection in the form of

triggers like cap on promoter pledge (50% of their total holding) and on total promoter borrowing

(not to exceed Rs.3,000 crs).

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 NCDholders 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.

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Suraksha Realty Ltd (CARE A1+(SO)

Suraksha Realty is a company owned by the promoter group of Sun Pharmaceutical Inds Ltd (rated AAA / A1+ by Crisil). Established by Mr. Dilip Shanghvi in 1983, Sun Pharma today has a market capitalization of Rs.128,700 crs (as on June 13, 2017).

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 equipments 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 will benefit from the representation of Tata Motors senior management on its board.

Additionally, both TMFL and TMFS will have a common managing director. TMFS is expected to

receive significant support from Tata Motors.

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.

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Select Statement of Holdings in our Fixed Income Funds as on 31st July 2017

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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.