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MIRA INFORM REPORT
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Report Date : |
15.12.2011 |
IDENTIFICATION DETAILS
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Name : |
KGK
DIAMONDS (HK) LTD. |
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Registered Office : |
14/F., Chevalier House, 45-51 Chatham Road South, Tsimshatsui, Kowloon |
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Country : |
Hong Kong |
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Date of Incorporation : |
27.10.2000 |
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Com. Reg. No.: |
31329946 |
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Legal Form : |
Private Limited Company |
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Line of Business : |
Manufacturer and Exporter of all kinds of diamonds |
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No. of Employees : |
32.
(Including associates in Hong Kong) |
RATING & COMMENTS
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MIRA’s Rating : |
B |
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RATING |
STATUS |
PROPOSED CREDIT LINE |
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26-40 |
B |
Capability to overcome financial difficulties seems comparatively
below average. |
Small |
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Status : |
Satisfactory |
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Payment
Behaviour : |
Slow |
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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 30th, 2011
|
Country Name |
Previous Rating (30.06.2011) |
Current Rating (30.09.2011) |
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Hong Kong |
a2 |
a2 |
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Risk Category |
ECGC
Classification |
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Insignificant |
A1 |
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Low |
A2 |
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Moderate |
B1 |
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High |
B2 |
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Very High |
C1 |
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Restricted |
C2 |
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Off-credit |
D |
Company name
KGK DIAMONDS
(HK) LTD.
Company ADDRESS
14/F., Chevalier House, 45-51 Chatham Road
South, Tsimshatsui, Kowloon, Hong Kong.
PHONE: 2723 9828, 2733 0700
FAX: 2739
7584
E-MAIL: kgk.hk@kgkmail.com
MANAGEMENT
Managing Director: Mr. Sanjay Navrattan Kothari
SUMMARY
Incorporated on: 27th
October, 2000.
Organization: Private
Limited Company.
Capital: Nominal: HK$90,000,000.00
Issued: HK$89,700,002.00
Business Category: Diamond Trader.
Employees:
32. (Including associates in Hong Kong)
Main Dealing Banker: The Royal Bank of Scotland N.V., Hong Kong Branch.
Banking Relation: Satisfactory.
Company ADDRESS
Registered Head Office:-
14/F., Chevalier House, 45-51 Chatham Road South, Tsimshatsui, Kowloon, Hong Kong.
China Factory:-
KGK Jewellery Manufacturing Ltd.
Panyu, Guangdong Province, China.
[Tel: (86-20) 3480 6744, 3999 0700
Fax: (86-20) 3480 6749, 3480 6759
E-mail: jewchina@kgkgroup.com
Holding Company:-
United Pacific Excel Ltd., British Virgin Islands.
Associated/Affiliated Companies:-
KGK Group of Companies
· K.G.K. Diamonds B.V.B.A., Belgium.
· KGK Creation Guangzhou Ltd., China.
· KGK Creations (India) Pvt. Ltd., India.
· KGK Creations Pvt. Ltd., India.
· KGK Diamond Israel Ltd., Israel.
· KGK Diamonds & Jewellery LLC, UAE.
· KGK Diamonds (Far East) Inc., Japan.
· KGK Diamonds (I) Pvt. Ltd., India.
· KGK Diamonds (Shanghai) Ltd., China.
· KGK Diamonds (SZ) Co. Ltd., China.
· KGK Diamonds Co. Ltd., Thailand.
· KGK Diamonds LLC, USA.
· KGK Enterprises, India.
· KGK Gems (HK) Ltd., Hong Kong.
· KGK Gems Ltd., Thailand.
· KGK Gems, India.
· KGK Investment USA (HK) Ltd., Hong Kong.
· KGK Jewellery (China) Ltd., Hong Kong.
· KGK Jewellery (HK) Ltd., Hong Kong.
· KGK Jewellery Inc., Japan.
· KGK Jewellery LLC, USA.
· KGK Jewellery Manufacturing Ltd., Hong Kong.
· KGK Jewellery Pvt. Ltd., India.
· KGK Mining (HK) Ltd., Hong Kong.
· KGK Properties (HK) Ltd., Hong Kong.
· KGK Real Estate (HK) Ltd., Hong Kong.
· M.B.K. Diamonds GmbH, Germany.
· Precious Trade Inc., USA.
· S. D. Diamond LLC, Russia.
· Star Rough Diamonds (Pty) Ltd., South Africa.
etc.
BUSINESS REGISTRATION NUMBER
31329946
COMPANY FILE NUMBER
0735843
MANAGEMENT
Managing Director: Mr. Sanjay Navrattan Kothari
CAPITAL
Nominal Share Capital: HK$90,000,000.00 (Divided into 90,000,000 shares of HK$1.00 each)
Issued Share Capital: HK$89,700,002.00
SHAREHOLDERS
(As per registry
dated 27-10-2010)
|
Name |
|
No.
of shares |
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United Pacific Excel Ltd. 263 Main Street,
P.O. Box 2196, Road Town, Tortola, British Virgin Islands. |
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88,000,000 |
|
Sanjay
Navrattan KOTHARI |
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1,700,001 |
|
Manju KOTHARI |
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1 |
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––––––––– |
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Total: |
89,700,002 ======== |
DIRECTORS
(As per registry
dated 27-10-2010)
|
Name (Nationality) |
Address |
|
Manju KOTHARI |
Flat B & C, 8/F., Robinson Garden
Apartments, 3 Robinson Road, Central, Hong Kong. |
|
Sanjay Navrattan
KOTHARI |
Flat B & C, 8/F., Robinson Garden
Apartments, 3 Robinson Road, Central, Hong Kong. |
SECRETARY
(As per registry
dated 27-10-2010)
|
Name |
Address |
Co.
No. |
|
Louis
Lai Co. Secretarial Services Ltd. |
9/F., Surson Commercial Building, 140-142 Austin Road, Tsimshatsui,
Kowloon, Hong Kong. |
0686503 |
HISTORY
The
subject was incorporated on 27th October, 2000 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: Manufacturer and Exporter.
Lines: All kinds of diamonds.
Employees: 32. (Including associates in Hong Kong)
Commodities Imported: India, other Asiann countries, Europe, etc.
Markets: Japan, USA, UAE, Korea, Australia, Middle East, South Africa, etc.
Terms/Sales: L/C, T/T or as per contracted.
Terms/Buying: L/C, T/T, D/P, etc.
MEMBERSHIP
· Diamond Federation of Hong Kong, China Ltd., Hong Kong.
· The Indian Chamber of Commerce Hong Kong, Hong Kong.2
FINANCIAL INFORMATION
Nominal Share Capital: HK$90,000,000.00 (Divided into 90,000,000 shares of HK$1.00 each)
Issued Share Capital: HK$89,700,002.00
Alternation of Capital:-
|
Initially |
paid up |
HK$ 46,800,002.00 |
|
27-02-2009 |
paid up |
HK$ 11,700,000.00 |
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04-03-2010 |
paid up |
HK$ 31,200,000.00 |
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|
|
–––––––––––––––– |
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Total: |
paid up |
HK$ 89,700,002.00 ============== |
Increase of Nominal Capital:-
|
From |
HK$60,000,000.00 |
to |
HK$90,000,000.00 |
on |
04-01-2010 |
Mortgage or Charge: (See attachment)
Profit or Loss: Making a small profit every year.
Condition: Keeping in an active condition.
Facilities: Making very active use of general banking facilities.
Payment: Met obligations as contracted.
Commercial Morality: Satisfactory.
Bankers:-
· The Royal Bank of Scotland N.V., Hong Kong Branch.
· Standard Chartered Bank (Hong Kong) Ltd., Hong Kong.
Standing: Good.
GENERAL
KGK
Diamonds (HK) Ltd. is a subsidiary company of United Pacific Excel Ltd. which
is a BVI-registered firm. The subject in
fact is a member of the KGK Group which is trading in diamond and related
products. It increased its issued share
capital in March 2010.
The
subject is trading in the Group’s products.
It has got a main affiliated company located at its operating address
known as KGK Jewellery (HK) Ltd., a Hong Kong-registered firm.
The
subject has set up at least six retailing outlets in Hong Kong which are
retailing the products of the KGK Group.
The
KGK Group is a global corporation based in India with fully integrated
operations in diamonds, coloured gemstones and jewellery.
From
procurement to manufacturing and from marketing to retailing, the Group is
present across the full value chain of the industry with offices spread across
the world.
KGK’s
diamond operation started in 1969 with diamonds trading and diamond
manufacturing activities began in 1982.
Initially
KGK was sourcing its rough diamonds from Antwerp which is the world’s diamond
capital. In 1997, KGK became the DTC
Sightholder and started getting rough diamonds directly from London in addition
to Antwerp. In 2005, KGK got sight in
South Africa. This has facilitated KGK
to produce more competitive and cost effective polish diamonds.
KGK
has set up marketing offices in all important cities in the world, and has set
up manufacturing units in India, Thailand, China, South Africa and Russia. These factories have modern machines for
diamond cutting and polishing operated by trained craftsmen. The stones are then assorted and graded into
different lots as per their cut, colour, clarity and size. The Group sources its diamonds and colour
stones from different parts of the world through its offices in Antwerp,
London, Russia and South Africa.
The
Group opened its offices in the UAE, Germany, Spain, London, etc.
KGK
Group is headed by Mr. Navrattan Kothari, who is the Group Chairman. Each division of the group is headed by
senior members of the Kothari family who have wide ranging experience in the
industry. The Gemstones business is
managed by Mr. Vinay Kothari and Mr. Prakash Kothari, while the Diamonds and
Jewellery business is under the supervision of Mr. Surendra Kothari, Mr. Sanjay
Kothari, Mr. Sandeep Kothari and Mr. Prashant Kothari.
Currently,
the subject is manufacturing the following commodities and offering clients
with the following services:-
|
Product/Service |
Product/Service
Remarks |
|
Jewellery –
Diamond |
Include
precious stones from India, Thailand, Belgium and Israel (Importer) |
|
Gemstones and
Jade |
Precious
stones (Manufacturer) Precious
stones (Exporter) Precious
stones from India and Thailand (Importer) |
|
Diamond |
From
India, Thailand, Belgium and Israel (Importer) |
The
Group now has set up a factory in Panyu Guangdong Province, China employing
about 300 persons. The factory is
specialised in diamond jewellery, magnetics and reversibles. In China, the Group has had the following
firms:-
KGK
Diamonds (Shanghai) Ltd.
KGK
Diamonds (SZ) Co. Ltd.
KGK
Jewellery Manufacturing Ltd.
In
Hong Kong, the subject manufactured exclusive, high-end jewellery in rounds and
various fancy shapes set in gold or platinum.
Besides
the Panyu factory, the Group’s other diamond manufacturing plants are located
in India and South Africa. In these
factories, KGK is able to manufacture quality diamonds in a range of sizes
(0.005 to 5.00 ct.), shapes, qualities (VVS1 to PK), colour and clarity.
The
Group’s gemstones such as emeralds, tanzanites, rubies and sapphires are
manufactured by its factories in Jaipur, Thailand and Sri Lanka.
The
Jaipur factory of the Group produces jewellery for KGK’s own showroom and the
domestic market.
Products
are exported to Japan, other Asian countries, the Middle East, North America
and Western Europe.
The
foundation of the KGK Group was laid in the year 1905, when Mr. Shri
Keshrimalji Kothari started trading in coloured gemstones simultaneously from
India and Burma. Assisted by his son,
Mr. Shri Ghisilalji Kothari, the business expanded from Jaipur to Chennai, and
then to Hong Kong. By the 1970’s with
new leadership at the helm of the Group, the business operations diversified
into diamonds and to new global locations such as the United States, Thailand,
Japan, etc. Now KGK Group has had
business concerns in fourteen countries of the world.
In
July 2009, Martin Flyer Ltd. [Martin Flyer], a US-based firm, confirmed its
partnership and strategic alliance with KGK Group. This partnership will give Martin Flyer
access to additional diamond supplies to fulfil its needs and grow its brands
according to future plans.
In
order to penetrate the international market further, KGK Group has taken part
in fairs and exhibitions held in Hong Kong and other foreign large cities. It has taken part in the following shows:-
United States
·
JCK Las Vegas Show
Europe
·
Baselworld, Switzerland
Hong Kong
·
HK International Jewellery Show
·
HK Jewellery & Gem Fair
China
·
Shenzhen International Jewellery
Fair
Asia (other than Hong
Kong and China)
·
International Jewellery Tokyo, Japan
·
Bangkok Gems & Jewelry Fair, Thailand
·
Jaipur Jewellery Show
·
India International Show
·
Bangkok Gems & Jewelry Fair,
Thailand
Middle East
·
Dubai International Jewellery Show
The
overall business of the subject in Hong Kong is active and satisfactory. The
subject is fully supported by the KGK Group.
History in Hong Kong is about eleven years. The subject shares the same office with its
associated companies KGK Jewellery Manufacturing Ltd. and KGK Jewellery (HK)
Ltd.
The
consolidated turnover of the Group is very significant.
On the whole,
consider the subject good for normal business engagements.
REMARKS:
Property
information of the company and director:-
1. Property Location: Flat 8 on 14/F. and Flat I on 18/F., Star Mansion, 3 Minden
Row, Kowloon, Hong Kong.
Owner: KGK Diamonds (HK) Ltd.
Date of
Purchase: n.a.
Purchased
Price: n.a.
Incumbrances:-
|
Date of Mortgage |
Amount
Consideration |
Mortgagee |
Nature |
|
23-05-2008 |
- |
ABN AMRO Bank N.V., Hong Kong Branch. [Now known as The Royal Bank of Scotland
N.V.] |
Mortgage to secure general banking facilities granted to KGK Diamonds
(HK) Ltd. and KGK Jewellery Manufacturing Ltd. |
2. Property Location: 8/F., Robinson Garden Apartments, 3B Robinson Road,
Hong Kong.
Owner: Sanjay Navrattan Kothari
Date of
Purchase: 25-05-1988
Purchased
Price: HK$1,700,000 pt.
Incumbrances:-
|
Date of Mortgage |
Amount
Consideration |
Mortgagee |
Nature |
|
23-01-1996 |
- |
Belgian Bank, Hong Kong Branch.
[Business was taken over by Industrial & Commercial Bank of China
(Asia) Ltd.] |
Legal charge to secure banking facilities |
|
16-09-2003 |
- |
Fortis Bank Asia HK, Hong Kong Branch. [Name changed to Belgian Bank but the
business was taken over by Industrial & Commercial Bank of China (Asia)
Ltd.] |
Deed of variation of M/N 6509498 and legal further charge |
MORTGAGE OR CHARGE
|
Date |
Particulars |
Amount |
|
27-05-2005 |
Instrument: Debenture Property: All the Company’s undertaking and rpoperty
and assets whatsoever and wheresoever both present and future including all
book and other debts revenues and claims Mortgagee: ABN
AMRO Bank N.V., Hong Kong Branch.
[Now known as The Royal Bank of Scotland N.V.] |
In consideration of ABN AMRO Bank N.V.
agreeing to grant general banking facilities to KGK Diamonds (HK) Ltd. |
|
23-05-2008 |
Instrument: Mortgage Property: 20/4,070th parts or shares of and in
Kowloon Inland Lot No. 9401 (Flat 8 on 14/F. and Flat I on 18/F. of Star
Mansion, 3 Minden Row, Kowloon, Hong Kong.) Mortgagee: ABN
AMRO Bank N.V., Hong Kong Branch.
[Now known as The Royal Bank of Scotland N.V.] |
In consideration of ABN AMRO Bank N.V.
agreeing to grant general banking facilities to KGK Jewellery Manufacturing
Ltd. |
|
23-05-2008 |
Instrument: Mortgage Property: 20/4,070th parts or shares of and in
Kowloon Inland Lot No. 9401 (Flat 8 on 14/F. and Flat I on 18/F. of Star
Mansion, 3 Minden Row, Kowloon, Hong Kong.) Mortgagee: ABN
AMRO Bank N.V., Hong Kong Branch.
[Now known as The Royal Bank of Scotland N.V.] |
In consideration of ABN AMRO Bank N.V.
agreeing to grant general banking facilities to KGK Diamonds (HK) Ltd. |
DIAMOND INDUSTRY –
INDIA
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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 8th Century B.C.
India, in fact, remained undisputed leader till 18th Century
when Brazilian fields were discovered in 1725 followed by emergence of S.
Africa, Russia and Australia.
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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.
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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.
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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.
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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.
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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.
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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 30th 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.53.58 |
|
UK Pound |
1 |
Rs.82.97 |
|
Euro |
1 |
Rs.69.89 |
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%)
This report is issued at your request without any
risk and responsibility on the part of MIRA INFORM PRIVATE LIMITED (MIPL)
or its officials.