MIRA INFORM REPORT
|
Report Date : |
20.12.2011 |
IDENTIFICATION DETAILS
|
Name : |
REAL
THAI GEMS LIMITED |
|
|
|
|
Registered Office : |
31/3
Trok Vaiti, Silom
Road, Silom, Bangrak,
Bangkok 10500 |
|
|
|
|
Country : |
Thailand |
|
|
|
|
Financials (as on) : |
31.12.2010 |
|
|
|
|
Date of Incorporation : |
11.06.1986 |
|
|
|
|
Com. Reg. No.: |
0105529019748 |
|
|
|
|
Legal Form : |
Private
Limited Company |
|
|
|
|
Line of Business : |
Importer,
Distributor and Exporter of Diamond and Gemstones |
|
|
|
|
No. of Employees
: |
8 persons |
RATING & COMMENTS
|
MIRA’s Rating : |
B |
|
RATING |
STATUS |
PROPOSED CREDIT LINE |
|
|
26-40 |
B |
Capability to overcome financial difficulties seems comparatively
below average. |
Small |
|
Status : |
Moderate |
|
|
|
|
Payment
Behaviour : |
No Complaints |
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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) |
|
Thailand |
b1 |
b1 |
|
Risk Category |
ECGC
Classification |
|
Insignificant |
A1 |
|
Low |
A2 |
|
Moderate |
B1 |
|
High |
B2 |
|
Very High |
C1 |
|
Restricted |
C2 |
|
Off-credit |
D |
Company name
REAL THAI GEMS
LIMITED
SUMMARY
BUSINESS
ADDRESS : 31/3
TROK VAITI, SILOM
ROAD, SILOM,
BANGRAK, BANGKOK
10500,
TELEPHONE : [66]
2234-2468, 2238-3188, 2238-3351,
2235-2861
FAX :
[66] 2236-2650,
2235-3675
E-MAIL
ADDRESS : realthai@ksc.th.com
REGISTRATION
ADDRESS : SAME
AS BUSINESS ADDRESS
ESTABLISHED : 1986
REGISTRATION
NO. : 0105529019748 [Former: 1974/2529]
CAPITAL
REGISTERED : BHT.
11,000,000
CAPITAL
PAID-UP : BHT.
11,000,000
SHAREHOLDER’S PROPORTION : THAI :
54.54%
INDIAN : 45.46%
FISCAL
YEAR CLOSING DATE : DECEMBER 31
LEGAL
STATUS : PRIVATE LIMITED
COMPANY
EXECUTIVE : MR.
ASHOK KUMAR GUPTA,
INDIAN
MANAGING DIRECTOR
NO.
OF STAFF : 8
LINES
OF BUSINESS : DIAMOND
AND GEMSTONES
IMPORTER, DISTRIBUTOR
AND EXPORTER
CORPORATE PROFILE
OPERATING
TREND : STABLE
PRESENT
SITUATION : OPERATING
NORMALLY
REPUTATION : GOOD FOR
NORMAL BUSINESS ENGAGEMENT
MANAGEMENT
STANDARD : MANAGEMENT
WITH FAIR PERFORMANCE
HISTORY
The subject was
established on June 11,
1986 as a
private limited company
under the name style REAL THAI GEMS LIMITED by
Thai and Indian groups, in order
to distribute diamond
and gemstones to
both domestic and overseas markets. It currently
employs 8 staff.
The
subject’s registered address
is 31/3 Trok
Vaiti, Silom Road,
Silom, Bangrak, Bangkok
10500, and this is
the company’s current
operation address.
THE BOARD OF DIRECTORS
Mr. Ashok Kumar
Gupta
AUTHORIZED PERSON
The above director
signs on behalf of
the subject with
the company’s affixed.
MANAGEMENT
Mr. Ashok Kumar
Gupta is the
Managing Director.
He is
Indian nationality with
the age of
44 years old.
BUSINESS OPERATIONS
The subject is engaged in importing, distributing and exporting of
diamonds and precious stones, such as
emerald, ruby, sapphire
and others, for
jewelry productions, as
well as jewelry
products.
PURCHASE
The products are purchased
from both local
and overseas suppliers in India,
Hong Kong, Japan
and Republic of
China.
MAJOR SUPPLIERS
Gupta Jewel
Corporation : India
Thai Fine Gems
& Jewelry Ltd. : Thailand
SALES [LOCAL]
The products are
sold locally to
jewelry manufacturers.
EXPORT [COUNTRIES]
The subject also exports
Thai gemstones to United States
of America, Indonesia, Hong Kong, Japan, and
European countries.
MAJOR CUSTOMER
GRK Gems Inc. : United
States of America
SUBSIDIARIES &
AFFILIATED COMPANY
The subject is
not found to
have subsidiaries or
affiliated company here
in Thailand.
LITIGATION
Bankruptcy and
Receivership
There are no
litigation on bankruptcy
and receivership cases
filed against the
subject found at
Legal Execution Department
for the past
five years.
Others
There are no
legal suits filed
against the subject for
the past two
years.
CREDIT
Sales are by
cash or on
the credits term
of 30-60 days.
Local bills are
paid by cash
or on the
credits term of
30-60 days.
Imports are by
T/T.
Exports are against
T/T.
BANKING
Kasikornbank Public Co.,
Ltd.
[Silom Branch
: Silom Rd.,
Silom, Bangrak, Bangkok
10500]
EMPLOYMENT
The subject employs
8 office and
sales staff.
LOCATION DETAILS
The premise is owned
for administrative office at
the heading address. Premise is
located in a
prime commercial area.
REMARK
MAXIMUM CREDIT SHOULD
BE GRANTED AT
US$ 700,000.
COMMENT
The subject’s sales in
2010 were moderate,
while growth was
likely contracted caused
by slow demand
of the products
from both local
and overseas markets.
However, the subject
reported a slightly improvement
in the first
half of 2011,
while in the
second half is still
due to consumption
sluggish from negative
factors.
FINANCIAL INFORMATION
The capital was
initially registered at
Bht. 2,000,000 divided
into 20,000 shares
of Bht. 100
each.
The capital was
increased later as
followings:
Bht.
5,000,000 on August
19, 1995
Bht.
10,000,000 on February 10,
1998
Bht.
11,000,000 on August
27, 1998
The latest
registered capital was
increased to Bht. 11,000,000 divided
into 110,000 shares of
Bht. 100 each
with fully paid.
MAIN
SHAREHOLDERS : [as at
April 30, 2011]
|
NAME |
HOLDING |
% |
|
|
|
|
|
Mr. Ashok
Kumar Gupta Nationality: Indian Address : 31/3 Trok Vaiti, Silom Rd., Silom, Bangrak, Bangkok 10500 |
50,000 |
45.46 |
|
Ms. Atcha
Gupta Nationality: Thai Address : 31/3 Trok Vaiti, Silom Rd., Silom, Bangrak, Bangkok 10500 |
20,000 |
18.18 |
|
Mr. Anurak
Gupta Nationality: Thai Address : 31/3 Trok Vaiti, Silom Rd., Silom, Bangrak, Bangkok 10500 |
20,000 |
18.18 |
|
Ms. Annika Gupta Nationality: Thai Address : 31/3 Trok Vaiti, Silom Rd., Silom, Bangrak, Bangkok 10500 |
20,000 |
18.18 |
Total Shareholders : 4
Share
Structure [as
at April 30,
2011]
|
Nationality |
Shareholders |
No. of Share |
% Shares |
|
|
|
|
|
|
Thai |
3 |
60,000 |
54.54 |
|
Indian |
1 |
50,000 |
45.46 |
|
Total |
4 |
110,000 |
100.00 |
NAME OF AUDITOR
& CERTIFIED PUBLIC ACCOUNTANT NO. :
Mr. Suchart Srimunjantha
No. 3549
BALANCE SHEET [BAHT]
The
latest financial figures
published for December
31, 2010 &
2009 were:
ASSETS
|
Current Assets |
2010 |
2009 |
|
|
|
|
|
Cash in Hand
& at Bank |
4,884,800.52 |
1,686,155.92 |
|
Trade Accounts Receivable |
24,644,383.14 |
28,774,742.26 |
|
Inventories |
25,024,871.08 |
27,173,410.63 |
|
|
|
|
|
Total Current Assets
|
54,554,054.74 |
57,634,308.81 |
|
Fixed Assets |
23,242,770.00 |
23,242,770.00 |
|
Other Assets |
563,670.19 |
274,855.73 |
|
Total Assets |
78,360,494.93 |
81,151,934.54 |
LIABILITIES &
SHAREHOLDERS' EQUITY [BAHT]
|
Current
Liabilities |
2010 |
2009 |
|
|
|
|
|
Trade Accounts Payable |
16,935,733.39 |
15,010,279.44 |
|
Accrued Expenses |
375,112.00 |
371,960.09 |
|
|
|
|
|
Total Current Liabilities |
17,310,845.39 |
15,382,239.53 |
|
Loan from Bank |
12,521,396.20 |
17,632,952.21 |
|
Total Liabilities |
29,832,241.59 |
33,015,191.74 |
|
|
|
|
|
Shareholders' Equity |
|
|
|
|
|
|
|
Share capital : Baht 100
par value authorized, issued
and fully paid share
capital 110,000 shares |
11,000,000.00 |
11,000,000.00 |
|
|
|
|
|
Capital Paid |
11,000,000.00 |
11,000,000.00 |
|
Retained Earning -
Unappropriated |
37,528,253.34 |
37,136,742.80 |
|
Total Shareholders' Equity |
48,528,253.34 |
48,136,742.80 |
|
Total Liabilities & Shareholders' Equity |
78,360,494.93 |
81,151,934.54 |
PROFIT & LOSS ACCOUNT
|
Sales |
2010 |
2009 |
|
|
|
|
|
Sales |
63,694,734.29 |
61,456,333.12 |
|
Other Income |
352,830.08 |
431,316.94 |
|
Total Saless |
64,047,564.37 |
61,887,650.06 |
|
Expenses |
|
|
|
|
|
|
|
Cost of Goods
Sold |
57,314,855.77 |
54,203,253.89 |
|
Selling Expenses |
835,777.87 |
1,368,762.84 |
|
Administrative Expenses |
3,969,066.53 |
5,247,110.42 |
|
Total Expenses |
62,119,700.17 |
60,819,127.15 |
|
|
|
|
|
Profit / [Loss] before Interest
Expenses & Income Tax |
1,927,864.20 |
1,068,522.91 |
|
Interest Expenses |
[900,443.99] |
[1,026,719.22] |
|
Profit / [Loss] before Income
Tax |
1,027,420.21 |
41,803.69 |
|
Income Tax |
[635,909.67] |
[642,650.82] |
|
|
|
|
|
Net Profit / [Loss] |
391,510.54 |
[600,847.13] |
FINANCIAL ANALYSIS
|
ITEM |
UNIT |
2010 |
2009 |
|
|
|
|
|
|
LIQUIDITY RATIO |
|
|
|
|
CURRENT RATIO |
TIMES |
3.15 |
3.75 |
|
QUICK RATIO |
TIMES |
1.71 |
1.98 |
|
|
|
|
|
|
ACTIVITY RATIO |
|
|
|
|
FIXED ASSETS TURNOVER |
TIMES |
2.74 |
2.64 |
|
TOTAL ASSETS TURNOVER |
TIMES |
0.81 |
0.76 |
|
INVENTORY CONVERSION PERIOD |
DAYS |
159.37 |
182.98 |
|
INVENTORY TURNOVER |
TIMES |
2.29 |
1.99 |
|
RECEIVABLES CONVERSION PERIOD |
DAYS |
141.22 |
170.90 |
|
RECEIVABLES TURNOVER |
TIMES |
2.58 |
2.14 |
|
PAYABLES CONVERSION PERIOD |
DAYS |
107.85 |
101.08 |
|
CASH CONVERSION CYCLE |
DAYS |
192.74 |
252.80 |
|
|
|
|
|
|
PROFITABILITY
RATIO |
|
|
|
|
COST OF GOODS SOLD |
% |
89.98 |
88.20 |
|
SELLING & ADMINISTRATION |
% |
7.54 |
10.77 |
|
INTEREST |
% |
1.41 |
1.67 |
|
GROSS PROFIT MARGIN |
% |
10.57 |
12.50 |
|
NET PROFIT MARGIN BEFORE EX. ITEM |
% |
3.03 |
1.74 |
|
NET PROFIT MARGIN |
% |
0.61 |
(0.98) |
|
RETURN ON EQUITY |
% |
0.81 |
(1.25) |
|
RETURN ON ASSET |
% |
0.50 |
(0.74) |
|
EARNING PER SHARE |
BAHT |
3.56 |
(5.46) |
|
|
|
|
|
|
LEVERAGE RATIO |
|
|
|
|
DEBT RATIO |
TIMES |
0.38 |
0.41 |
|
DEBT TO EQUITY RATIO |
TIMES |
0.61 |
0.69 |
|
TIME INTEREST EARNED |
TIMES |
2.14 |
1.04 |
|
|
|
|
|
|
ANNUAL GROWTH |
|
|
|
|
SALES GROWTH |
% |
3.64 |
|
|
OPERATING PROFIT |
% |
80.42 |
|
|
NET PROFIT |
% |
165.16 |
|
|
FIXED ASSETS |
% |
- |
|
|
TOTAL ASSETS |
% |
(3.44) |
|
PROFITABILITY RATIO
|
Gross Profit Margin |
10.57 |
Deteriorated |
Industrial Average |
29.20 |
|
Net Profit Margin |
0.61 |
Impressive |
Industrial Average |
(51.65) |
|
Return on Assets |
0.50 |
Impressive |
Industrial Average |
(13.01) |
|
Return on Equity |
0.81 |
Impressive |
Industrial Average |
(3.83) |
Gross Profit Margin used to assess a firm's financial health by
revealing the proportion of money left over from saless after accounting for
the cost of goods sold. Gross profit margin serves as the source for paying
additional expenses and future savings. The company's figure is 10.57%. When
compared with the industry average, the ratio of the company was lower,
indicated that company was originated from the
problems with control over its costs.
Net Profit Margin is the indicator of the company's efficiency in that
net profit takes into consideration all expenses of the company. A low profit
margin indicates a low margin of safety, higher risk that a decline in sales
will erase profits and result in a net loss. The company's figure is 0.61%, higher figure when compared with those
of its average competitors in the same industry, indicated that business was an
efficient operator in a dominant
position within its industry.
Return on Assets measures how efficiently profits are being generated
from the assets employed in the business when compared with the ratios of firms
in a similar business. A low ratio in comparison with industry averages
indicates an inefficient use of business assets. Return on Assets ratio is
0.5%, higher figure when compared with those of its average competitors in the
same industry, indicated that business was an efficient profit in a dominant position within its industry.
Return on Equity indicates how profitable a company is by comparing its
net income to its average shareholders' equity, ROE measures how much the
shareholders earned for their investment in the company. Return on Equity ratio
is 0.81%, higher figure when compared with those of its average competitors in
the same industry, indicated that business was an efficient profit in a dominant position within its industry.
Trend of the
average competitors in the same industry for last 5 years
Return on Assets Downtrend
Return on Equity Downtrend
LIQUIDITY
RATIO
|
Current Ratio |
3.15 |
Deteriorated |
Industrial
Average |
83.84 |
|
Quick Ratio |
1.71 |
|
|
|
|
Cash Conversion Cycle |
192.74 |
|
|
|
The Current Ratio is to ascertain whether a company's short-term assets
are readily available to pay off its short-term liabilities. The company's
figure is 3.15 times in 2010, decreased from 3.75 times, then it is generally
considered to have good short-term financial strength. When compared with the
industry average, the ratio of the company was lower.
The Quick Ratio is a liquidity indicator that further refines the current
ratio by measuring the amount of the most liquid current assets there are to
cover current liabilities. The company's figure is 1.71 times in 2010,
decreased from 1.98 times, although excluding inventory so the company still
have good short-term financial strength.
The Cash Conversion Cycle measures the number of days a company's cash
is tied up in the production and sales process of its operations and the
benefit from payment terms from its creditors. It meant the company could
survive when no cash inflow was received from sale for 193 days.
Trend of the
average competitors in the same industry for last 5 years
Current Ratio Uptrend
LEVERAGE RATIO
|
Debt Ratio |
0.38 |
Impressive |
Industrial
Average |
1.91 |
|
Debt to Equity Ratio |
0.61 |
Impressive |
Industrial
Average |
1.49 |
|
Times Interest Earned |
2.14 |
Deteriorated |
Industrial
Average |
343.72 |
Debt to Equity Ratio a measurement of how much suppliers, lenders,
creditors and obligors have committed to the company versus what the
shareholders have committed. A lower the percentage means that the company is
using less leverage and has a stronger equity position.
Times Interest Earned measuring a company's ability to meet its debt
obligations. Ratio is 2.15 higher than 1, so the company can pay interest
expenses on outstanding debt.
Debt Ratio shows the proportion of a company's assets which are financed
through debt. The company's figure is 0.38 less than 0.5, most of the company's
assets are financed through equity.
Trend of the
average competitors in the same industry for last 5 years
Debt Ratio Uptrend
Times Interest Earned Uptrend
ACTIVITY RATIO
|
Fixed Assets Turnover |
2.74 |
Deteriorated |
Industrial
Average |
167,038.45 |
|
Total Assets Turnover |
0.81 |
Acceptable |
Industrial
Average |
1.18 |
|
Inventory Conversion Period |
159.37 |
|
|
|
|
Inventory Turnover |
2.29 |
Acceptable |
Industrial
Average |
4.27 |
|
Receivables Conversion Period |
141.22 |
|
|
|
|
Receivables Turnover |
2.58 |
Deteriorated |
Industrial
Average |
34.28 |
|
Payables Conversion Period |
107.85 |
|
|
|
Trend of the
average competitors in the same industry for last 5 years
Fixed Assets Turnover Uptrend
Total Assets Turnover Downtrend
Inventory Turnover Uptrend
Receivables Turnover Uptrend
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 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.
-
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 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.52.96 |
|
UK Pound |
1 |
Rs.82.04 |
|
Euro |
1 |
Rs.68.91 |
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.