MIRA INFORM REPORT

Report Date :

06.12.2011

IDENTIFICATION DETAILS

Name :	V.D. GEMS (H.K.) LTD.

Registered Office :	Room 703, 7/F., Podium Plaza, 5-7A Hanoi Road, Tsimshatsui, Kowloon

Country :	Hong Kong

Date of Incorporation :	09.12.2009

Com. Reg. No.:	51613818

Legal Form :	Private Limited Company.

LINE OF BUSINESS :	IMPORTER, EXPORTER AND WHOLESALER OF ALL KINDS OF DIAMONDS AND JEWELLERY PRODUCTS, EMERALD, PRECIOUS STONES, ETC.

No. of Employees :	5. (Including affiliate)

RATING & COMMENTS

MIRA’s Rating :

RATING		STATUS	PROPOSED CREDIT LINE
26-40	B	Capability to overcome financial difficulties seems comparatively below average.	Small

Status :	Moderate
Payment Behaviour :	No Complaints
Litigation :	Clear

NOTES :

Any query related to this report can be made on e-mail: infodept@mirainform.com while quoting report number, name and date.

ECGC Country Risk Classification List – September 30, 2011

Country Name

Previous Rating

(30.06.2011)

Current Rating

(30.09.2011)

Hong Kong

Risk Category	ECGC Classification
Insignificant	A1
Low	A2
Moderate	B1
High	B2
Very High	C1
Restricted	C2
Off-credit	D

Company name and address

V.D. GEMS (H.K.) LTD.

ADDRESS: Room 703, 7/F., Podium Plaza, 5-7A Hanoi Road, Tsimshatsui, Kowloon, Hong Kong.

PHONE: 2541 0018

FAX: 2581 9141

MANAGEMENT

Managing Director: Mr. Viral Shreyas Mehta

SUMMARY

Incorporated on: 9th December, 2009.

Organization: Private Limited Company.

Capital: Nominal: HK$780,000.00

Issued: HK$390,000.00

Business Category: Diamond Trader.

Employees: 5. (Including affiliate)

Main Dealing Banker: The Hongkong & Shanghai Banking Corp. Ltd., Hong Kong.

Banking Relation: Satisfactory.

ADDRESS

Registered Head Office:-

Room 703, 7/F., Podium Plaza, 5-7A Hanoi Road, Tsimshatsui, Kowloon, Hong Kong.

Holding Company:-

V. D. International Ltd., UAE.

Associated/Affiliated Companies:-

B.V. Diamond Polishing Works Ltd., Thailand.

Vijay Diamond (FZE), UAE.

Vijay Diamonds (Shanghai) Ltd., China.

Vijay Jewels, India.

Vijaydiamond International Ltd., Hong Kong. (Same address)

Vijaydimon (H.K.) Ltd., Hong Kong. [Dissolved]

Vijaydimon (USA) Inc., USA.

Vijaydimon BVBA, Belgium.

Vijaydimon Diamond (India) Pvt. Ltd., India.

Vijaydimon Polished Distributors BVBA, Belgium.

Vijaydimon Pte. Ltd., Singapore.

BUSINESS REGISTRATION NUMBER

51613818

COMPANY FILE NUMBER

1399948

MANAGEMENT

Managing Director: Mr. Viral Shreyas Mehta

CAPITAL

Nominal Share Capital: HK$780,000.00 (Divided into 7,800 shares of HK$100.00 each)

Issued Share Capital: HK$390,000.00

SHAREHOLDER

(As per registry dated 09-12-2010)

Name		No. of shares
V. D. International Ltd. 1003, Khalid Al Attar Tower, Sheikh Zayed Road, P.O. Box 71241, Dubai, UAE.		3,900 ====

Name

No. of shares

V. D. International Ltd.

1003, Khalid Al Attar Tower, Sheikh Zayed Road, P.O. Box 71241, Dubai, UAE.

3,900

====

DIRECTOR

(As per registry dated 09-12-2010)

Name (Nationality)	Address
Viral Shreyas MEHTA	Flat E, 13/F., Tsui Fung Mansion, 27 Tsui Fung Street, Fung Wong Village, Kowloon, Hong Kong.

Name

(Nationality)

Address

Viral Shreyas MEHTA

Flat E, 13/F., Tsui Fung Mansion, 27 Tsui Fung Street, Fung Wong Village, Kowloon, Hong Kong.

SECRETARY

(As per registry dated 09-12-2010)

Name	Address	Co. No.
Dhun’s Management Services Ltd.	7/F., Man On Commercial Building, 12-13 Jubilee Street, Central, Hong Kong.	0027006

HISTORY

The subject was incorporated on 9th December, 2009 as a private limited liability company under the Hong Kong Companies Ordinance.

Apart from these, neither material change nor amendment has been ever traced and noted.

OPERATIONS

Activities: Importer, Exporter and Wholesaler.

Lines: All kinds of diamonds and jewellery products, emerald, precious stones, etc.

Employees: 5. (Including affiliate)

Commodities Imported: India, other Asian countries, Belgium, etc.

Markets: China, India, other Asian countries, Europe, etc.

Terms/Sales: L/C, T/T, etc.

Terms/Buying: L/C, T/T, etc.

FINANCIAL INFORMATION

Nominal Share Capital: HK$780,000.00 (Divided into 7,800 shares of HK$100.00 each)

Issued Share Capital: HK$390,000.00

Profit or Loss: Making a small loss in 2010.

Condition: Business is under development.

Facilities: Making fairly active use of general banking facilities.

Payment: Met trade commitments as contracted.

Commercial Morality: Too early to comment.

Banker: The Hongkong & Shanghai Banking Corp. Ltd., Hong Kong.

Standing: Small.

GENERAL

V.D. Gems (H.K.) Ltd. is a wholly-owned subsidiary of V. D. International Ltd. which is a UAE-based firm.

The director of the subject Viral Shreyas Mehta is a Hong Kong ID Card holder and has got the right to reside in Hong Kong permanently.

The subject is a diamond and jewellery trader. It has had an affiliated company Vijaydiamond International Ltd. [VIL] which is a Hong Kong-registered company located at the same operating address.

VIL is a member of the Vijaydiamond Group. Vijaydiamond Group is a group of companies trading in diamonds. It is engaged in diamonds manufacturing, distributing, designing and retailing.

Vijaydiamond Group has been in the rough and polished diamonds trading for over 36 years. It also has been in the diamond jewellery business for over sixteen years. Its diamonds are sourced from the world’s leading rough diamond suppliers. Besides, Vijaydiamond Group is also a DTC sightholder, a customer of Rio Tinto (both Argyle and Diavik supplies) and regularly receives supply from Russia.

Vijaydiamond Group has operations in Belgium, India, the United States, Thailand, China, the United Arab Emirates and Singapore, besides Hong Kong.

The firm of the Group in Antwerp, Belgium is known as Vijaydiam BVBA. Another firm located at the same address of the above-mentioned firm is known as Vijaydimon Polished Distributors BVBA. Both firms are the significant member of the Group.

Vijaydiamond Group is able to provide customers with polished diamonds in a broad range of round and fancy shapes. Its jewellery designing and manufacturing division is known as Vijay USA.

In 2004, Vijaydiamond Group set up a retailing outlet in India which is in New Delhi.

The United Arab Emirates is one of the prime markets of the Group. Business in this country keeps on expanding.

Vijaydiamond Group is a main supplier of the subject. The subject is responsible for marketing the Group’s products in Hong Kong, exporting to the other Asian countries and Europe. Business is still under development.

The history of the subject is just about two years in Hong Kong.

On the whole, since the history of the subject is short, consider it good for normal business engagements on L/C basis for the time being.

DIAMOND INDUSTRY – INDIA

- From time immemorial, India is well known in the world as the birthplace for diamonds. It is difficult to trace the origin of diamonds but history says that in the remote past, diamonds were mined only in India. Diamond production in India can be traced back to almost 8^th Century B.C. India, in fact, remained undisputed leader till 18^th Century when Brazilian fields were discovered in 1725 followed by emergence of S. Africa, Russia and Australia.

- The achievement of the Indian diamond industry was possible only due to combination of the manufacturing skills of the Indian workforce and the untiring and unflagging efforts of the Indian diamantaires, supported by progressive Government policies.

- The area of study of family owned diamond businesses derives its importance from the huge conglomerate of family run organizations which operate in the diamond industry since many generations.

- Some of the basic traits of family run business enterprises include spirit of entrepreneurship, mutual trust lowers transaction costs, small, nimble and quick to react, information as a source of advantage and philanthropy.

- Family owned diamond businesses need to improve on many fronts including higher standard of corporate governance, long-term performance – focused strategies, modern management and technology.

- The diamond jewellery industry in India today may be more than Rs 60000 mil and is rated amongst the fastest growing in the world. Indi ranks third in the world in domestic diamond consumption.

- Utmost caution is to be exercised while dealing with some medium and large diamond traders which are usually engaged in fictitious import – export, inter-company transactions, financially assisted by banks. In the process, several public sector banks lost several hundred million rupees. They mostly diverted borrowed money for diamond business into real estate and capital markets.

- Excerpts from Times of India dated 30^th October 2010 is as under –

DIAMOND SAGA – DIRTY DOZEN STUCK WITH 2K CR DEBT

This could be the biggest credibility crisis the Indian diamond industry has ever faced. Fifteen banks run the risk of losing Rs 2000 crore lent to a dozen diamond firms in Surat. Until about two months ago, they had not repaid these dues. Bankers believe many diamantaires borrowed money during the economic downturn two years ago and diverted funds to businesses like real estate and capital markets. Many of themselves made money from these businesses but their diamond companies have gone sick and declared insolvency.

- Most of the money borrowed from the banks in the name of their diamond business has been diverted in real estate and the share market. The banks are not in a position to seize their properties because in many cases, these were purchased in the name of their relatives and friends.

FOREIGN EXCHANGE RATES

Currency	Unit	Indian Rupees
US Dollar	1	Rs.51.39
UK Pound	1	Rs.80.20
Euro	1	Rs.68.92

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	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
--	NB	New Business	--

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%)

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