MIRA INFORM REPORT

 

 

 

Report Date :

19.12.2008

 

IDENTIFICATION DETAILS

 

Name :

DOV DIAMONDS (1999) LTD

 

 

Registered Office :

1 Jabotinsky Street, Diamond Exchange, Maccabi Bldg., RAMAT GAN      52520

 

 

Country :

Israel

 

 

Financials (as on) :

2006

 

 

Date of Incorporation :

23.09.1999

 

 

Com. Reg. No.:

51-283362-5

 

 

Legal Form :

Private Limited Company

 

 

Line of Business :

Importers, polishers, exporters and marketers of diamonds, dealing in diamond processing and setting

 

 

RATING & COMMENTS

 

MIRA’s Rating :

Ba

 

RATING

STATUS

PROPOSED CREDIT LINE

41-55

Ba

Overall operation is considered normal. Capable to meet normal commitments.

Satisfactory

 

Status :

Satisfactory

 

 

Payment Behaviour :

No Complaints

 

 

Litigation :

Clear

 

COMPANY NAME & ADDRESS 

 

DOV DIAMONDS (1999) LTD.

(Hebrew registered name: DOV DIAMONDS (1999) CO. LTD.)

1 Jabotinsky Street

Diamond Exchange, Maccabi Bldg.

RAMAT GAN     52520   ISRAEL

Telephone         972 3 575 23 27

Fax                  972 3 575 08 48

 

 

HISTORY & LEGAL FORMATION

 

A private limited company, incorporated as per file No. 51-283362-5 on the 23.09.1999, continuing the activities of a general partnership established in 1984, under the name DOV DIAMONDS (now struck-off the Registrar of Companies).

 

 

SHARE CAPITAL

 

Authorized share capital of NIS 38,000.00 divided into: 37,990 ordinary shares, 10 management shares, all of NIS 1.00 each, of which shares amounting to NIS 120.00 were issued.

 

 

SHAREHOLDERS

 

1.         Shlomo Dov Shimshowitz,

2.         Mrs. Ilana Shimshowitz, holding 1 single ordinary share.

 

 

SOLE DIRECTOR & GENERAL MANAGER

 

Shlomo Dov Shimshowitz, born 1952, of 24 Havatzelet Hasharon Street, Herzliya.

 

 

BUSINESS

 

Importers, polishers, exporters and marketers of diamonds, dealing in diamond processing and setting.

 

Operating from office premises in 1 Jabotinsky Street, Diamond Exchange, Maccabi Building (9th Floor), Ramat Gan.

 

Number of employees not forthcoming.

 

 

MEANS

 

Financial data not forthcoming, however has been known to be financially solid.

 

There are 4 charges for unlimited amounts registered on the company's assets, in favor of Israel Union Bank Ltd., Israel Discount Bank Ltd. and The First International Bank of Israel Ltd.

                                                                                                                       

 

ANNUAL SALES

 

2002 sales for export reported to be US$ 31,000,000.

2003 sales for export reported to be US$ 35,000,000.

2004 sales for export reported to be US$ 40,000,000.

2005 sales for export reported to be US$ 35,000,000.

2006 sales for export reported to be US$ 28,000,000.

Later sales figures not forthcoming.

 

 

BANKERS

 

Israel Union Bank Ltd., Diamond Exchange Branch (No. 062), Ramat Gan.

Israel Discount Bank Ltd., Diamond Exchange Branch (No. 080), Ramat Gan.

The First International Bank of Israel Ltd., Diamond Exchange Branch (No. 026), Ramat Gan.

 

 

CHARACTER AND REPUTATION

 

Nothing unfavorable learnt.

 

Subject's shareholder and Manager, Mr. Dov Shimshowitz, refused to disclose any data on his company.

 

Subject is a veteran business, well-known in the branch.

According to the report published by the Israel Supervisor on Diamonds in the Ministry of Industry and Trade, subject was ranked 29th in the 2006 list of Israel's largest polished diamonds exporters. It was ranked 25th in the 2005 list. In 2004 subject was ranked 14th, in 2003 – 22nd, in 2002 – 25th, and 24th in 2001. In 2000 subject was ranked 20th.

 

Mr. Dov Shimshowitz is the son-in-law of Ben-Zion Pozilov, a leading diamond dealer and among the pioneers in the local diamonds industry. The Pozilov family own PAZ ISRAEL DIAMONSDS, founded in 1946 (who until 2008 held 6% in subject directly) and involved in ELUL DIAMONDS LTD., also leading diamond companies, as well as in other firms in the diamond and other areas.

 

Local diamond companies have been facing depression in business in general in recent period due to the recession in the U.S. markets, which worsened with the collapse in the financial markets in the U.S.A. and spread over the world during September-October-November 2008. The American market has been the No. 1 export market and the crisis in the U.S. market affects directly many Israeli diamond companies, as purchasing has gone down dramatically. There have been reports on delays in payments from clients, causing a cash flow problem to some local companies. Some diamond dealer report sales are stagnant.

 

The crisis in the world financial markets affected the diamond industry: Export of cut diamonds (net) during the first 10 months of 2008 summed up to US$ 5.8 billion, representing a 2.2% decrease comparing to parallel period in 2007. That after in October 2008, cut diamonds export fell by 46% comparing to October 2007. Export of rough diamonds (net) from Israel in October fell even sharper – by 58.5% comparing to October 2007.

 

Import of rough diamonds (net) rose 1.7% in the first 10 months of 2008 (from 2007) to US$ 4.07 billion, while in October alone import fell by 52.6%. Import of cut diamonds (net) also fell sharply in October 2008 by 44.4% reaching total of US$ 3.79 billion for the whole first 10 months of 2008.

 

Year 2007 marked a record in the export of cut diamonds from Israel, with net sales for export of US$ 7.076 billion, 7% rise from 2006 (US$ 6.611 billion). Exports (net) of rough diamonds were US$ 3.386 billion, a 25.5% increase from 2006 (US$ 2.701 billion, which was a 23.2% decrease from 2005).

 

Import of rough diamonds (net) rose 8% in 2007 by (from 2006) to
US$ 5.084 billion, while import of cut diamonds (net) also increased in 2007 by 13.3% reaching US$ 4.558 billion.

 

The USA is the main market for Israel’s export of cut diamonds, although its portion has been decreasing in view of the economic situation – the export rate is currently 43%, comparing to 60%-65% in past years. The secondary markets are Hong Kong (24%), Belgium (9%), U.K (3%), followed by China, Switzerland and India.

 

According to the President of the Israeli Diamonds Association, local banks are expected to contract credit given to local diamond firms, in view of the global financial crisis. However, he believes the local diamond sector is healthy, as trade in the sector rolls annual turnover of US$ 25 billion whereas total debt to the banks stands on US$ 2.5 billion.

 

 

SUMMARY

 

Notwithstanding the refusal to disclose any data, considered good for trade engagements.

 

FOREIGN EXCHANGE RATES

 

Currency
Unit

Indian Rupees

US Dollar

1

Rs.47.08

UK Pound

1

Rs.71.17

Euro

1

Rs.66.98

 

 

RATING EXPLANATIONS

 

RATING

STATUS

 

 

PROPOSED CREDIT LINE

>86

Aaa

Possesses an extremely sound financial base with the strongest capability for timely payment of interest and principal sums

 

Unlimited

71-85

Aa

Possesses adequate working capital. No caution needed for credit transaction. It has above average (strong) capability for payment of interest and principal sums

 

Large

56-70

A

Financial & operational base are regarded healthy. General unfavourable factors will not cause fatal effect. Satisfactory capability for payment of interest and principal sums

 

Fairly Large

41-55

Ba

Overall operation is considered normal. Capable to meet normal commitments.

 

Satisfactory

26-40

B

Unfavourable & favourable factors carry similar weight in credit consideration. Capability to overcome financial difficulties seems comparatively below average.

 

Small

11-25

Ca

Adverse factors are apparent. Repayment of interest and principal sums in default or expected to be in default upon maturity

 

Limited with full security

<10

C

Absolute credit risk exists. Caution needed to be exercised

 

 

Credit not recommended

NR

In view of the lack of information, we have no basis upon which to recommend credit dealings

No Rating

 

 

This score serves as a reference to assess SC’s credit risk and to set the amount of credit to be extended. It is calculated from a composite of weighted scores obtained from each of the major sections of this report. The assessed factors and their relative weights (as indicated through %) are as follows:

 

Financial condition (40%)            Ownership background (20%)                 Payment record (10%)

Credit history (10%)                    Market trend (10%)                                Operational size (10%)

 

 

PRIVATE & CONFIDENTIAL : This information is provided to you at your request, you having employed MIPL for such purpose. You will use the information as aid only in determining the propriety of giving credit and generally as an aid to your business and for no other purpose. You will hold the information in strict confidence, and shall not reveal it or make it known to the subject persons, firms or corporations or to any other. MIPL does not warrant the correctness of the information as you hold it free of any liability whatsoever. You will be liable to and indemnify MIPL for any loss, damage or expense, occasioned by your breach or non observance of any one, or more of these conditions