November 16, 2013

Mumbai

Himachal Fibres Limited

Ratings Suspended

Total Bank Loan Facilities Rated	Rs.302.2 Million
Long -Term Rating	Suspended
Short-Term Rating	Suspended

(Refer to Annexure 1 for details on facilities)

CRISIL has suspended its ratings on the bank facilities of Himachal Fibres Limited (HFL). The suspension of ratings is on account of non-cooperation by HFL with CRISIL's efforts to undertake a review of the ratings outstanding. Despite repeated requests by CRISIL, HFL is yet to provide adequate information to enable CRISIL to assess HFL’s ability to service its debt. The suspension reflects CRISIL's inability to maintain a valid rating in the absence of adequate information. CRISIL considers information availability risk as a key credit factor in its rating process and non-sharing of information as a first signal of possible credit distress, as outlined in its criteria ‘Information Availability Risk in Credit Ratings’

About the Company

HFL, set up in 1980, was promoted by Mr. B K Garodia in collaboration with Himachal Pradesh Minerals & Industrial Development Corporation Ltd. It was acquired by the present management, headed by Mr. Rajesh Gupta, in 2005-06 (refers to financial year, April 1 to March 31). The company’s manufacturing facility in Himachal Pradesh has a capacity of 20,344 spindles. In 2001, HFL was declared a sick unit under the Board for Industrial & Financial Reconstruction (BIFR) and became non-operational from 2003-04. The plant restarted operations in 2007-08, with cotton yarn; however, as demand for cotton yarn was decreasing, the company started the production of polyester yarn, acrylic yarn, and knitted cloth after June 2008. In October 2010, the company was discharged from the purview of BIFR, after its net worth turned positive.

Annexure 1 - Details of various bank facilities

Current facilities			Previous facilities
Facility	Amount (Rs. Million)	Rating	Facility	Amount (Rs. Million)	Rating
Cash Credit	200	Suspended	Cash Credit	200	CRISIL B-/Stable
Letter of Credit	25	Suspended	Letter of Credit	25	CRISIL A4
Term Loan	77.2	Suspended	Term Loan	77.2	CRISIL B-/Stable
Total	302.2	--	Total	302.2	--

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Tanuja Abhinandan Communications and Brand Management CRISIL Limited Tel: +91-22- 3342 1818 Mobile: +91- 98192 48980 Email:tanuja.abhinandan@crisil.com Jyoti Parmar Communications and Brand Management CRISIL Limited Tel: +91-22- 3342 1835 E-mail: jyoti.parmar@crisil.com	Mohit Makhija Director - CRISIL Ratings Tel: +91-124-672 2000 Email: mohit.makhija@crisil.com	Timings: 10.00 am to 7.00 pm Toll free number: 1800 267 1301 Email:CRISILratingdesk@crisil.com

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Last updated: May, 2013

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November 16, 2013	http://www.crisil.com