Key Credit Brief

KEY CREDIT BRIEF

A brief on credit rationales and analysis of less known credit papers in our portfolio.

Kotak Credit Process - Mitigating Risk Through Robust Practices

Select Statement Of Holdings In Our Fixed Income Funds As On

Credit Papers	Kotak Banking and PSU Debt Fund	Kotak Bond Fund	Kotak Bond Short Term Fund	Kotak Corporate Bond Fund	Kotak Credit Risk Fund	Kotak Dynamic Bond Fund	Kotak Low Duration Fund	Kotak Liquid Fund	Kotak Medium Term Fund	Kotak Money Market Fund	Kotak Savings Fund	Kotak Floating Rate Fund	Kotak Debt Hybrid Fund
DLF Home Developers Pvt Ltd
Prestige Projects Private Limited
SEIL Energy
Vajra Trust 008 (Originated by Veritas Finance Private Limited)
360 One Prime Ltd.
360 ONE WAM Limited
Aadhar Housing Finance Limited
Bahadur Chand Investments Private Limited
Bharti Telecom Ltd.
Century Textiles and Industries Limited
Cholamandalam Investment and Finance Company Ltd.
DBS Bank India Limited
DME Development Limited
Embassy Office Parks REIT
First Business Receivables Trust
Future Lifestyle Fashions Ltd.
Godrej Properties Limited
HDB Financial Services Ltd.
IGH Holdings Private Limited
India Grid Trust
Indinfravit Trust
IndoStar Capital Finance Limited
IOT Utkal Energy Services Ltd.
J M Financial Products Limited
Jamnagar Utilities & Power Private Limited
JM Financial Asset Reconstruction Co. Pvt. Ltd
JM Financial Credit Solutions Ltd.
JM Financial Services Ltd.
John Deere Financial India Private Limited
Macrotech Developers Ltd.
Mindspace Business Parks REIT – NCDs
Motilal Oswal Financial Services Limited
Muthoot Finance Ltd.
Nirma Limited
ONGC Petro Additions Ltd.
Panatone Finvest Ltd
Pilani Investment and Industries Corporation Ltd.
Piramal Capital & Housing Finance Limited
Poonawalla Fincorp Ltd
Punjab National Bank
RBL Bank Ltd.
Sansar Trust Nov 2023 IV (Originator Shriram Finance Ltd)
Sansar Trust Sep 2023 IX (Originator Shriram Finance Ltd)
Sharekhan Limited
Tata Steel Ltd.
U P Power Corporation Ltd

Credit Papers

DLF Home Developers Pvt Ltd(ICRA AA)New( ICRA Rationale Link)

DLF Home Developers Ltd (DHDL) is a 100% subsidiary of DLF Ltd. The company is involved in acquisition and development of real estate.
DLF Limited is one of the largest real estate developers in India with primary presence in National Capital Region (NCR) market. It has gradually diversified in Kochi, Chandigarh, Chennai, Goa, Mumbai, Indore, Lucknow markets. The company has strong growth pipeline of 65 million sqft (including under development assets in residential and commercial segment).
DHDL is strategically important to DLF Group as it is executing flagship luxury projects like ‘The Arbour’.
DHDL has profitable operations with PAT margin of ~28.3% in FY2023.
The capital structure of the company is robust with Gross Gearing (Debt/Equity) of 0.1x in FY2023. The company has negative net external debt.
We draw additional comfort from corporate guarantee issued by parent DLF Ltd for the exposure.
The issuer has credit rating of AA(Stable)/A1+ from ICRA.

Prestige Projects Private Limited(ICRA A)New(ICRA Rationale Link)

Prestige Projects Private Limited (PPPL), is part of Prestige Estates Projects Limited (PEPL). At present, PEPL holds a 60% stake in the company and the remaining 40% is held by Pinnacle Investments (a firm owned by promoters of PEPL).
PPPL has launched various residential project in cities such as Bangalore Hyderabad etc
The tow of its townships projects viz Prestige City, Banglaore and Prestige City, Hyderabad has got very good response.
The NCDs are secured by immovable property with a security cover of minimum 1.50 times.

SEIL Energy(CRISIL A1+)New(CRISIL Rationale Link)

SEIL Energy India Ltd (SEIL) was incorporated in 2008. It is currently owned by Tanveer Infrastructure which is an Omani consortium.
The company owns and operates two thermal projects, P1 and P2. P1 involves a 1,320-MW (2X660 MW) super-critical thermal power project in Painampuram, AP. P2 involves a 1,320-MW (2X660 MW) coal-fired thermal power plant near the port city of Krishnapatnam, AP.
The company has signed long term power purchase agreements (PPAs) primarily with discoms of Andhra Pradesh and Telangana with smaller PPAs with Gujarat, PTC India and Bangladesh Discom. Currently ~85% of capacity is tied up with PPAs giving revenue visibility.
The operating performance of SEIL continues to be satisfactory with profitable operations.
The capital structure of the company is robust with Gross Gearing (Debt/Equity) of 0.57x in FY2023. Net Debt/EBITDA of the company was 3.88x in FY2023.
The issuer has credit rating of AA+(Stable)/A1+ from CRISIL and Indiaratings.

Vajra Trust 008 (Originated by Veritas Finance Private Limited)(ICRA AAA(SO))New(ICRA Rationale Link)

Securitisation of pool of small business loan (SBL) and home construction loan (HCL) receivables originated by Veritas Finance Private Ltd.
The pool is well diversified with low obligor concentration, weighted average seasoning of 16.75 months and weighted average LTV of 35.59% as of cut-off date.
The pool has an external credit enhancement of 5% of initial pool principal in the form of fixed deposits. Further credit support is available in form of Excess Interest Spread (EIS) and subordination by way of equity tranche.
The pool is rated as AAA (SO) by ICRA.

360 One Prime Ltd.(CRISIL A1+)(CRISIL Rationale Link)

360 One Prime Limited is an NBFC registered with the RBI, and a 100% subsidiary of 360 One WAM Ltd (earlier known as IIFL Wealth Management Limited).
The NBFC offers a range of lending solutions to group’s clients and is a leading NBFC in India by asset size in the wealth management industry. It is primarily involved in lending against securities, loans against securities, loan against property, margin trading funding and unsecured loans. Loan Against security represents ~83% of loan book in Sep 2023.
NBFC follows risk management framework keeping sufficient collateral cover on disbursed loans which are monitored regularly.
NBFC is profitable with net profit of Rs. 173 crores in H1FY2024.
It is well capitalized and has capital adequacy ratio of 24.03% in Sep 2023.

360 ONE WAM Limited(ICRA A1+)(CRISIL Rationale Link)

360 ONE WAM Limited was founded in 2008. It is one of the largest private wealth management firms in India. It has been listed in Indian exchangessince Sep’19 and currently has market capital of ~Rs 25,000 crores.
The company operates in wealth management and asset management space in India with focus on High Net worth individuals and Ultra High Net Worth Individuals.
It has multiple offerings including 1) Portfolio Management Services (2) advisory (corporate treasury solutions), (3) private equity funds, (4) listed equities, (5) long short strategy, (6) real estate funds, (7) a wide gamut of tie-ups for AIF/PMS/MF distribution among others.
Apart from a diversified product suite, the company also offers other surrogate services like real estate planning, lending, etc.
The company has profitable operations with PAT margins of ~32% in 9MFY2024.
Balance sheet is comfortable with Gross gearing (Debt/Equity) of 2.67x in Dec’23.
The company is rated A1+ by CRISIL/CARE and AA(Stable)/A1+ by ICRA.

Aadhar Housing Finance Limited(CARE AA,ICRA AA)(CARE Ratings Rationale Link)

Aadhar Housing Finance Limited (AHFL) is a housing finance company (HFC) engaged in providing affordable housing finance
Blackstone through its fund BCP TOPCO VII Pte. Ltd. holds majority stake in the company
As on 31st December 2023, the company had assets under management (AUM) of ~Rs. 19,865 crore.
The loan book is also well diversified with 498 branches and offices across 20 states and UTs as on 31st December 2023
Post take over by Blackstone, the cost of borrowing and liquidity position of the company has also improved considerably

Bahadur Chand Investments Private Limited(ICRA A1+,ICRA AA)(ICRA Rationale Link)

Bahadur Chand Investments Private Limited and its parent, Brijmohan Lal Om Prakash’s (BMOP), are the principal holding companies of Hero MotoCorp Limited (HMCL).
BCIPL has strong financial flexibility emanating from the market value of its investment in HMCL. It holds ~20% stake in HMCL
BCIPL and BMOP also hold equity and preference stake in a large number of group companies viz. Hero FinCorp Limited, Hero Future Energies Private Limited etc

Bharti Telecom Ltd.(CRISIL A1+,CRISIL AA+)(CRISIL Rationale Link)

Bharti Telecom Ltd. (BTL) is promoted by Bharti group and Singtel, Singapore.
BTL holds 39.57% shareholding of Bharti Airtel Limited (BAL) (December'23).
Market value of BTL’s holding in BAL is around Rs. 278,747 crores (Jan 31, 2024) which provides financial flexibility to the Company.

Century Textiles and Industries Limited(CRISIL AA)(CRISIL Rationale Link)

Incorporated in 1897, the company is promoted by Late Mr BK Birla and is a part of the Aditya Birla Group.
Following equity infusion in March and December 2015, the Aditya Birla group is a significant stakeholder in the company.
Company operated a cotton textile mill until 1951. Since then, it has progressively expanded into diverse fields by setting up manufacturing units in rayon, cement and pulp and paper segments.
The company also ventured into the real estate business. In FY18, the company incorporated a wholly owned subsidiary, Birla Estate Pvt Ltd to focus on the residential real estate business.
It manufactures a variety of paper products (including multi-layer packaging board and tissue paper) with total installed capacity of 4.81 lakh tonne per annum.
The company had a gearing ratio of 0.26x as on Mar’23 on consolidated basis.

Cholamandalam Investment and Finance Company Ltd.(ICRA AA+,CRISIL A1+)(CRISIL Rationale Link)

Cholamandalam Investment and Finance Company Ltd (CIFCL), a non-banking finance company, is a part of the Chennai-based Murugappa Group of companies.
The company’s core business segments include vehicle finance and home equity (HE) loans. The company has recently launched new business verticals (i.e. Personal Loan, consumer and small enterprise loan and SME loan)
CIFCL has two wholly-owned subsidiaries viz., Cholamandalam Home Finance Limited and Cholamandalam Securities Limited.
The gearing of the company was 6.79x on consolidated basis as of Mar'23

DBS Bank India Limited(IND A1+)(India Ratings Rationale Link)

DBS Bank India Limited (“DBIL”) is a wholly owned subsidiary (WOS) of DBS Bank Ltd., Singapore (“DBL”).
DBIL’s total deposits and advances stood at Rs. 61,375 crore and Rs. 47,160 crore respectively as on March 31, 2023, constituting around 6% and 10% of overall foreign banks deposits and advances respectively.
DBS was amalgamated with the erstwhile Lakshmi Vilas Bank Limited (eLVB) during FY2021.
DBIL has acceptable NNPA of 0.54% respectively as on December 31, 2023.
DBIL’s capitalisation profile stands comfortable with CET I/Tier I of 15.16% as on December 31, 2023 against the regulatory requirement of 8.00% and 9.50%, respectively supported by modest internal accruals and infusion from parent.
Additionally, DBIL also benefits from shared brand name, operational synergies with the parent including senior management oversight, representation of DBL’s senior management on DBIL’s board, common risk management systems & standards and treasury platforms.

DME Development Limited(CRISIL AAA)(CRISIL Rationale Link)

DME Development Limited (“DME” or “the company”), is a Special Purpose vehicle (SPV) formed by National Highway Authority of India (“NHAI” or “the authority”) with 100% shareholding
DME was incorporated to undertake development of approximate 1,312 km-long expressway between Delhi and Mumbai on a greenfield alignment. This would be an eight-lane expressway with a provision to expand to 12 lanes.
The project is having concession period of 20 years including construction period of 3 years and is expected to be completed by 2024
DME has further entered into an implementation agreement with NHAI for construction and maintenance of the project, there by transferring the risk of construction and maintenance of the project to NHAI
NHAI has nominated its senior and experienced personnel to DME’s board including representation of one senior official from Ministry of Road Transport and Highways

Embassy Office Parks REIT(CRISIL AAA)(CRISIL Rationale Link)

Embassy REIT is registered as an irrevocable trust under the Indian Trust Act, 1882, and as a real estate investment trust (REIT) with SEBI’s Real Estate Investment Trust Regulations.
It is sponsored by BRE Mauritius Investments (part of the Blackstone group) and Embassy Property Development Pvt. Ltd (part of the Embassy group). Investment is in NCD issued by REIT, it gets stable cash flow primarily from rental of commercial assets
It has a portfolio of assets which include 13 commercial assets (office parks and city centric offices), 98 buildings, 1,614 hotel keys (including under construction) and 100 MW solar power plant as of Dec 31, 2023
The commercial assets enjoy robust occupancy of around 85% and have upside potential for rentals, given the good asset and service quality.
The projects are located in prime areas of Mumbai, Pune, Bengaluru, and National Capital Region.
The net debt to total assets ratio was 0.28 times as on Mar’23

First Business Receivables Trust(CRISIL AAA(SO))(CRISIL Rationale Link)

It is a securitization where loan given by Reliance Industries Limited (RIL) to Reliance Corporate IT Park Ltd (RCIPTL) has been assigned to PTC Holder. The same will be serviced from service receivable from Reliance Industries Limited, Reliance Retail Limited (RRL) and Reliance Jio Infocomm Limited (RJIL).
Reliance Corporate IT Park Ltd (RCITPL) provides infrastructure, IT and IT enabled services across India including from its office complex in Ghansoli, Navi Mumbai to RIL, RJIL and RRL, for which it has entered into ’Business Service Agreements’ (BSA) for a period of 13 years.
The same is rated as AAA(SO) by CRISIL as the primary risk is predicated on RIL,RJIL,RRL which are rated as AAA.

Future Lifestyle Fashions Ltd.(CRISIL D)(CARE Rationale Link)

Future Lifestyle Fashions Ltd. (FLF) operates in fashion retail and distribution. FLF operates retail outlets in 3 broad formats – Central (big-box fashion retailer), Brand Factory (fashion discount chain) and Exclusive Brand Outlets.
Lockdown/Covid-19 has impacted fashion/retail industry significantly, also impacting financial and operating performance of FLF.
Above resulted in multiple downgrade of external rating of company. The rating was downgraded to below investment grade in Oct’20.
We had exercised put option on NCDs issued by FLF, by virtue of which the maturity shifted to 9th Nov'20 from 9th Nov'22. The Company failed to make the repayment including interest payment on due date which resulted in downgrade of external rating to D.
In May’23, Hon’ble National Company Law Tribunal has allowed the admission of insolvency petition under insolvency and bankruptcy code. NCLT has appointed Interim Resolution Professional (IRP). Subsequently Committee of Creditors (CoC) has appointed it to Resolution Professional (RP). RP has asked for expression of interest from Prospective Resolution Applicants (PRAs). RP has finalized list of 13 PRAs. Out of them 2 PRAs has submitted resolution plan. The same is under evaluation by RP and CoC.
We value the investments at 21% (of the Face Value plus accrued till date of default), adjust for recoveries.
We will continue to monitor the developments in the company and take all necessary steps to recover the dues from the company, in the best interest of unit holders.

Godrej Properties Limited(ICRA AA+)(ICRA Rationale Link)

Godrej Properties Ltd (hereinafter, GPL) is currently developing residential, commercial and township projects spread across 10 cities with total saleable area of ~215 million sq. ft. as on Feb 6, 2024
GPL is a part of the Godrej Group which is amongst India’s most diversified conglomerates.
The Godrej Group was established in 1897 and comprises of a varied business portfolio that includes real estate development, fast moving consumer goods, advanced engineering, home appliances, furniture, security, and agri-care.
In 2010, Godrej Properties became a publicly listed company through a successful IPO. It is one of India’s only national developers with a strong presence across the country’s leading real estate markets.
The net debt-equity ratio was 0.36x as on Mar’23.

HDB Financial Services Ltd.(CRISIL AAA)(CRISIL Rationale Link)

HDB Financial Services Limited (HDB Finance) was set up as an non-banking finance company by HDFC Bank. HDFC Bank owns majority of equity shares in HDB Finance.
Apart from the lending business, HDB Finance is also engaged in the distribution of general and life insurance products for HDFC Ergo General Insurance Company and HDFC Standard Life Insurance Company, respectively. The company also runs BPO services that undertake collection services, back office and sales support functions under a contract with HDFC Bank.
HDB Finance receives support from HDFC Bank in terms of operational and managerial support with regard to formulation of credit policies, portfolio monitoring and collection practices and also receives regular funding support.
The company complements the parent's product portfolio and distribution network, and supports collection activities for the retail portfolio.
It has a consolidated gearing of 4.8x as on Mar'23

IGH Holdings Private Limited(CRISIL A1+)(CRISIL Rationale Link)

IGH Holdings Private Limited (“IGH”) is part of Aditya Birla Group and it is 100% subsidiary of Essel Mining and Industries Limited
IGH is one of the holding company for the Group and it holds stake in various operating listed companies of the Group such as Hindalco Industries, Grasim Industries, Aditya Birla Capital, Century Textiles and Industries, Aditya Birla Fashion and Retail etc
The market value of holding in listed companies is significantly higher than external debt of IGH

India Grid Trust(CRISIL AAA,IND AAA)(CRISIL Rationale Link)

India Grid Trust (IndiGrid) was set up on October 21, 2016, as an irrevocable trust under the provisions of the Indian Trusts Act, 1882, and was registered with SEBI as an Infrastructure Investment Trust (InvIT)
IndiGrid operates in power transmission sector and its portfolio primarily consists of power transmission assets
All SPVs (except one) under IndiGrid are interstate transmission system (ISTS) licensees and comes under the point of connection pool mechanism, where Power Grid Corporation of India, as the central transmission utility, collects monthly transmission charges from all designated customers on behalf of the licensees
IndiGrid was originally sponsored by Sterlite Power Grid Ventures Ltd (SPGVL). As of Dec 2023, KKR is the sponsor of the trust.
It has a gearing ratio of 2.88 as on Mar-23

Indinfravit Trust(ICRA AAA)(ICRA Rationale Link)

Indinfravit Trust is an Infrastructure Investment Trust under SEBI regulations, sponsored by L&T IDPL and backed by marquee investors such as CPPIB, Omers and Allianz Capital.
Till Mar 2023, trust had 13 road assets. It has acquired 4 road assets from Brookfield in Jun 2023. Hence the total size of portfolio has increased to 17 road projects.
The portfolio consists of 14 toll road assets and 3 annuity assets. The assets have an average operational track record of 10 years. The portfolio is well diversified and is spread across 7 states.
~95% of revenue is under concession from NHAI indicating low counterparty risk.
Indinfravit has comfortable credit metrics with Total Debt/Equity of 1.58x and Net debt/EBITDA of 3.8x in Mar 2023.

IndoStar Capital Finance Limited(CRISIL AA-)(CRISIL Rationale Link)

IndoStar Capital Finance Limited (“IndoStar” or “the company”) is a systemically important NBFC with consolidated AUM of Rs. 7,726 crores as on Sept 30, 2023. On an overall basis, Commercial Vehicle (CV) finance book constituted ~57% of the total AUM as on Sep 30, 2023, Home finance book at 25%, SME finance book at 15% and corporate book at 4%. Retail loan book accounted for 95% of the consolidated AUM as on Sep 30, 2023.
Going ahead, the Company intends to focus primarily on used CV financing and affordable housing finance.
The standalone capitalisation profile stood comfortable with CRAR of 32.76% as on Sept 30, 2023.
Brookfield Asset Management (Brookfield) is the largest shareholder and co-promoter of the company with 56.2% stake, followed by the Everstone group at 18.8% as on Sept 30, 2023. Brookfield has supported the company in the past and is expected to support IndoStar going ahead.

IOT Utkal Energy Services Ltd.(CRISIL AAA)(CRISIL Rationale Link)

IOT Utkal Energy Services Ltd. (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 (IOC) 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).
IOTUL’s crude and product storage tanks facility plays a critical role in the operations of IOC’s Paradip refinery. IOTUL also benefits from the fixed cash flows arising from its contractual agreement with IOC.
The NCDs of IOT Utkal are backed by an annuity based contract executed with its sole counterparty, Indian Oil Corporation Ltd.

J M Financial Products Limited(CRISIL A1+,ICRA AA)(CRISIL Rationale Link)

JM Financial Products Ltd (JMFPL) is the Non-Banking Finance Company (NBFC) arm of the JM Financial Group. It is a non-deposit accepting systemically important non-banking finance company registered with the Reserve Bank of India.
JMPFL specializes in borrowing and lending activities including Loan against Securities, IPO financing, ESOP financing, Real estate Financing, Structured Financing etc. It is one of the largest players in the securities based lending business.
The JM Financial Group is a diversified financial services player with an established track record and franchise and presence in investment banking, broking, wealth management, investment advisory services, asset management, private equity, lending and asset reconstruction.
The consolidated Debt/Equity ratio of JMPFL was 2.35 times as on Mar’23

Jamnagar Utilities & Power Private Limited(CRISIL AAA,CRISIL A1+)(CRISIL Rationale Link)

Jamnagar Utilities & Power Private Limited (“JUPL”) is owned by promoters of Reliance Industries Ltd. (RIL)
It is primarily engaged in the business of setting up, operating and maintaining captive power plants at various manufacturing locations of Reliance Industries Limited (RIL).
JUPL has set-up power plants at various locations viz Dahej, Hazira and Jamnagar with aggregate capacity to generate over 2300 megawatt (MW) of power and over 10000 tonne per hour (tph) of steam.
Its power plants in Jamnagar, Hazira, and Dahej are captive to the existing petrochemicals and refining business of RIL and caters to most of its power requirement.

JM Financial Asset Reconstruction Co. Pvt. Ltd(CRISIL AA-)(CRISIL Rationale Link)

JM Financial Asset Reconstruction Company Limited is an Asset Reconstruction Company, registered with RBI and it is one of the leading ARCs in India. JM Financial Ltd is the holding company of JMARC.
The company invests in acquiring good quality assets at the right price and limiting the downside by ensuring sufficient underlying security value.
The AUM of JMARC is Rs 15,114 crores as of Sep’23 which is fairly diversified with presence across multiple sectors.
The company has low leverage in balance sheet with total CRAR of 26.51% as of Dec’23

JM Financial Credit Solutions Ltd.(ICRA AA)(ICRA Rationale Link)

JM Financial Credit Solutions Limited (JMCSL) is a non-banking financial company and is jointly promoted by the JM Financial Group and global fund led by Mr. Vikram Pandit, ex-Chief Executive Officer (CEO) of Citigroup. JM Financial Ltd is the holding company of JMCSL.
The company is engaged in secured wholesale lending, largely catering to the residential real estate sector through product offerings such as construction finance, loan against property, loan against land, loans for early-stage projects and loan against securities.
The company has profitable operations with low leverage in balance sheet with total CRAR of 42.56% as of Dec’23.
JMCSL has comfortable ALM profile.

JM Financial Services Ltd.(CRISIL A1+)(CRISIL Rationale Link)

JM Financial Services Ltd (JMFSL) is a 100% subsidiary of JM Financial Ltd (JMFL) and is engaged in providing equity broking, investment advisory, wealth management, and distribution services to corporates, HNIs, and retail investors.
It is also engaged in securities-based lending i.e. margin trade funding (MTF). JMFSL represents the Investment Advisory business of JM Financial Group and focusses on Investment Advisory and Wealth Management businesses for non-institutional clients.
The company has profitable operations since inception

John Deere Financial India Private Limited(CRISIL AAA)(CRISIL Rationale Link)

John Deere Financial India Private Limited (JDFIPL), incorporated in October 2011, is a systemically important non-deposit taking non-banking financial company (NBFC) registered with the Reserve Bank of India (RBI).
It is a wholly-owned subsidiary of John Deere India Private Limited (JDIPL), which, in turn, is indirectly wholly owned by Deere & Company (Deere; through John Deere Asia (Singapore) Pte Limited), USA.
JDFIPL was incorporated with the aim to support sales of JDIPL vehicles in India.
It primarily offers retail finance for the purchase of farm equipment manufactured and sold by JDIPL and for the construction equipment manufactured and sold by Wirtgen India Private Limited (which was also acquired by Deere & Company in Dec’17).
The gearing ratio for the company is 3.56 as on Mar’23
Deere & Co, headquartered in US, is a world leader in farm and farm equipment manufacturing with a global presence. The company operates through three business segments: agriculture and turf, construction and forestry, and financial services.

Macrotech Developers Ltd.(ICRA A+)(ICRA Rationale Link)

Macrotech Developers Limited (“Macrotech” or “the Company) earlier known as Lodha Developers Limited
Macrotech is one of the largest real estate developers in India with significant presence in Mumbai and Thane market
It has track record of more than four decades and had developed around ~94 million square foot of development
The Company has reported healthy pre-sales and collections in last couple of years
The Company had deleveraged balance sheet in last few years with equity infusions and cashflow from business. The consolidated debt/equity stands at 0.74 times on Mar’23.

Mindspace Business Parks REIT – NCDs(CRISIL AAA)(CRISIL Rationale Link)

Mindspace REIT is registered as an irrevocable trust under the Indian Trust Act, 1882, and as a Real Estate Investment Trust (REIT) with SEBI’s REIT Regulations, 2014. Mindspace REIT’s portfolio assets are held through the asset SPVs.
The real estate investment trust (REIT) owns eight special purpose vehicles (asset SPVs) comprising 10 commercial offices, information technology (IT) parks and special economic zone (SEZ) assets, and houses the facility management division.
The net debt to total assets ratio was ~0.18 times as on Mar’23

Motilal Oswal Financial Services Limited(ICRA A1+)(ICRA Rationale Link)

Motilal Oswal Financial Services Limited (MOFSL) is among India’s leading provider of capital market related services.
Motilal Oswal group is majorly present in fee-based businesses like broking, asset & wealth management and investment banking
MOFSL ranks among the top ten equity brokers by active number of active clients in the broking industry.
MOFSL had a debt-equity ratio of 1.64 times on consolidated basis as on Mar'23

Muthoot Finance Ltd.(CRISIL AA+,ICRA AA+,CRISIL A1+)(CRISIL Rationale Link)

Muthoot Finance Ltd. (MFL) was incorporated in 1997 and is India’s largest gold loan focused NBFC with consolidated loan book of ~Rs 82,773 crs on Dec 31, 2023 and a net worth of ~Rs 23,402 crore (consolidated) on Sep 30, 2023.
Muthoot Finance Limited (MFL) is the flagship company of the Kerala-based business house, The Muthoot Group, which has diversified operations in financial services, healthcare, real estate, education, hospitality, power generation and entertainment.
It had a consolidated debt-equity ratio of 2.5 times as on Mar’23.

Nirma Limited(CRISIL AA)(CRISIL Rationale Link)

Nirma set up Dr. Karsanbhai K Patel in 1980 to manufacture detergents, expanded its operations to soaps, chemicals and processing of minerals. The company is the largest soda ash manufacturer in India.
It has one plant in USA and 4 in India (all situated in the State of Gujarat).
The revenue profile is well diversified across product profile i.e. soda ash, detergent, soaps, caustic soda, linear alkyl benzene, salt etc.
The company has done certain large acquisition in past which resulted in increase of leverage; however with strong cash flow accruing to the businesses, the company had deleveraged its balance sheet. The financial position remained healthy with Net Debt/EBITDA of 0.5x as of Mar’23.
Recently Nirma has announced acquisition of 75% stake in Glenmark Life Science Ltd which is expected to be completed in Q4FY24.
The company is rated AA/A1+ by CRISIL with stable outlook.

ONGC Petro Additions Ltd.(ICRA AAA(CE))(ICRA Rationale Link)

ONGC Petro additions Limited is a Joint Venture incorporated in 2006, promoted by Oil and Natural Gas Corporation Limited (ONGC) and GAIL (India) Limited (GAIL) and co-promoted by Gujarat State Petroleum Corporation Ltd. (GSPC) with stake of 49.36%, 49.21% and 1.43% .
OPaL has setup a 1.1 MMTPA (million metric tonnes per annum) Greenfield petrochemicals complex at Dahej SEZ in Gujarat. The principal business of OPaL is to produce, purchase, treat, market, distribute, import, export and trade petrochemicals products and its by-products.
There are strong linkages with ONGC as OPAL remains strategically important to ONGC and ONGC has also infused capital in the form of warrants and has provided backstopping support for CCDs. OPaLs project is a part of forward integration plans of ONGC. Entire feedstock for OPaL is currently sourced from ONGC.
The bonds have letter of comfort from ONGC

Panatone Finvest Ltd(CRISIL A1+)(CRISIL Rationale Link)

Panatone Finvest Ltd (PFL) is principal telecom & media holding company of Tata Group and is held ~100% by Tata Sons.
The Company is registered as Core Investment Company (CIC) with Reserve Bank of India
PFL currently holds significant stake in Tata communications Ltd (TCL) and Tejas Networks Ltd (TNL).
The market value of its investment in group companies is significantly higher than debt outstanding

Pilani Investment and Industries Corporation Ltd.(CRISIL A1+)(CRISIL Rationale Link)

Pilani Investment and Industries Corporation Limited (PIICL) is an investment holding company of “Birla Group”
Investments in group companies including Hindalco Industries Limited, Grasim Industries Limited, UltraTech Cement Limited, Century Textiles and Industries Limited, Aditya Birla Capital Limited, Aditya Birla Fashion and Retail Limited etc
The Company is registered as NBFC with Reserve Bank of India
The market value of its investment is listed companies is significantly higher than debt outstanding

Piramal Capital & Housing Finance Limited(CRISIL A1+)(CRISIL Rationale Link)

Piramal Capital and Housing Finance Limited (“PCHFL”) is a housing finance company (HFC), wholly owned by Piramal Enterprises Limited (“PEL”).
PCHFL’s loan book stood at Rs. 43,031 crore as on Sep 30, 2023.
The headline asset quality indicators have witnessed an improvement with gross NPA/net NPA improving to 3.1%/1.7% respectively as on Sep 30, 2023 from 3.5%/1.9% respectively as on Mar 31, 2023.
The capitalisation profile for PCHFL stood comfortable with CRAR at 26.8% as on Mar 31, 2023 and gearing at 2.77x as on Sep 30, 2023

Poonawalla Fincorp Ltd(CRISIL AAA)(CRISIL Rationale Link)

PFL is non-deposit-taking non-banking finance company, having presence over 30 years in asset backed financing. Major portfolio includes pre-owned cars, affordable housing finance, SME LAP, Loan to professional etc.
The group was founded by Mr. Sanjay Chamaria and Mayank Poddar. However, Poonawalla Group lead by Mr Adar Poonawalla acquired majority stake in the company in May 2021 for ~Rs. 3,500 crore
Post the takeover by Poonawalla, the company realigned its strategy and exhibited growth with standalone AUM growing to ~Rs. 21,946 crore as of Dec 31, 2023

Punjab National Bank(ICRA A1+,CRISIL A1+,CRISIL AAA,CRISIL AA+/A1+)(CRISIL Rationale Link)

Punjab National Bank is the second largest Public Sector Bank in India
Govt. of India (GOI) owns 73.15% as on Dec23
As on Dec 31, 2023 PNB had total capitalization of 14.63% with Tier-1 of 11.73%.

RBL Bank Ltd.(ICRA A1+)(ICRA Rationale Link)

RBL is a private sector bank established in 1943 with advances at Rs. 79,949 crore as on December 31, 2023.
The loan book growth in the recent past was led by rising share of the retail segments (58% of advances as on December 31, 2023 as against 41% as on March 31, 2019).
The headline asset quality metrics reported an improvement with gross NPA (GNPA) and Net NPA (NNPA) at 3.12% and 0.80%, respectively, as on December 31, 2023 (4.34% and 2.12%, respectively, as on March 31, 2021).
The total deposits stood at Rs. 92,746 crore as on December 31, 2023. The share of retail LCR deposits improved to ~44.4% of total deposits as against 38.9% as on March 31, 2022 thereby improving granularity of the deposit base.
Profitability profile has witnessed improvement with RoA at 0.94% in H1FY24.
RBL’s capitalisation profile stands comfortable with CET I/Tier I % of 14.58% as on December 31, 2023.

Sansar Trust Nov 2023 IV (Originator Shriram Finance Ltd)(CRISIL AAA(SO))(CRISIL Rationale Link)

Securitisation of pool of vehicle loans originated by Shriram Finance Limited.
The pool is well diversified with low obligor concentration and a weighted average seasoning of 9.5 months as of cut-off date.
The pool has credit enhancement in the form of 12.75% of pool principal as cash collateral. Further credit support is available in form of Excess Interest Spread (EIS).
The pool is rated as AAA (SO) by CRISIL.

Sansar Trust Sep 2023 IX (Originator Shriram Finance Ltd)(ICRA AAA(SO))( ICRA Rationale Link)

Securitisation of pool of vehicle loans originated by Shriram Finance Limited.
The pool is well diversified with low obligor concentration and a weighted average seasoning of 7.8 months as of cut-off date.
The pool has credit enhancement in the form of 6% of pool principal and cash collateral of 6%. Further credit support is available in form of Excess Interest Spread (EIS).
The pool is rated as AAA (SO) by ICRA.

Sharekhan Limited(ICRA A1+)(CRISIL Rationale Link)

Sharekhan Limited (“Sharekhan” or “the company”) is a security broking service provider, registered with the Securities and Exchange Board of India (SEBI). The company is wholly owned by BNP Paribas S.A., a leading bank in Europe
The company is one of the leading broking house in India with presence since 2007 and also has international presence through its branch in UAE. The company is having sizeable presence in western and north-western parts of the country
Sharekhan’s main business activity includes share broking (primarily in the retail segment) and the distribution of mutual fund products. It also has a small presence in portfolio management services
Apart from broking business, the company through its wholly owned subsidiary provides financing solution to retail clients of the Group through various capital market products
The consolidated gearing of company stands at 1.18x as of Mar'2023

Tata Steel Ltd.(IND AA+,CRISIL A1+)(India Ratings & Reserach Rationale Link)

Tata Steel Limited was established as India’s first integrated steel company in 1907.
The company has presence across the entire value chain of steel manufacturing from mining and processing iron ore and coal to producing and distributing finished products.
The company offers a broad range of steel products such as hot rolled, cold rolled, coated steel, rebars, wire rods, tubes and wires.
Tata steel has an annual crude steel production capacity of 34 million tonnes per annum globally
The company is one of the most geographically diversified steel producers, with operations in various countries and commercial presence in more than 50 countries across the globe
Tata Steel is one of the leading company of the Tata Group
The debt equity ratio is 0.28 times as on Mar’23 on standalone basis.

U P Power Corporation Ltd(CRISIL A+ (CE) )(CRISIL Rationale Link)

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 bonds are secured by charge on receivables of UPPCL. It will be further supported by fund infusion from GoUP on quarterly basis through budgetary allocation i.e. debt servicing by GoUP. These are further secured by an unconditional and irrevocable guarantee from Govt. of Uttar Pradesh.
The structure has escrow mechanism wherein daily collections are deposited into escrow a/c which gets used for servicing of bonds.

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.

Name of the Scheme	Type of Scheme	This product is suitable for investors who are seeking*	Riskometer	PRC Matrix