MIRA INFORM REPORT
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Report Date : |
22.12.2011 |
IDENTIFICATION DETAILS
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Name : |
A. SCHWARTZ & SONS DIAMONDS LTD. |
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Formerly Known As : |
AHARON SCHWARTZ & SONS DIAM |
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Registered Office : |
P.O. Box 3026
(52130), 3a Jabotinsky Street,
Diamond Exchange, Yahalom, Bldg., Ramat Gan 52520 |
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Country : |
Israel |
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Date of Incorporation : |
24.10.1971 |
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Legal Form : |
Private Limited Company |
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Line of Business : |
Manufacturers, Polishers, Traders, Exporters and Marketers of
diamonds, as well as gold and diamond jewelry. |
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No. of Employees
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80 -100
persons |
RATING & COMMENTS
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MIRA’s Rating : |
Ba |
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RATING |
STATUS |
PROPOSED CREDIT LINE |
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41-55 |
Ba |
Overall operation is considered normal. Capable to meet normal
commitments. |
Satisfactory |
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Status : |
Satisfactory |
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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
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Country Name |
Previous Rating (30.06.2011) |
Current Rating (30.09.2011) |
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Israel |
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 & address
A. SCHWARTZ & SONS DIAM
Telephone 972 3 613
08 90; 575 25 49
Fax 972 3
575 13 92
P.O. Box 3026 (52130)
3A Jabotinsky Street
Diamond Exchange, Yahalom Bldg.
RAMAT GAN 52520-ISRAEL
HISTORY & LEGAL FORMATION
A private limited
company, incorporated as per file No. 51-058705-7 on the 24.10.1971, by the
Late Aharon Schwartz, continuing diamond business activities founded in 1949.
Originally
registered under the name D
SHARE CAPITAL
Authorized share capital NIS 20,000.00,
divided into:
20,000 ordinary shares of NIS
1.00 each,
of which 250
shares amounting to NIS 250.00 were issued.
SHAREHOLDERS
1. Uri Schwartz, 84.8%,
2. Itay Schwartz, 15.2%.
DIRECTORS
1. Uri Schwartz, President,
2. Itay Schwartz.
GENERAL MANAGER
Kobi
Herzmann.
BUSINESS
Manufacturers, polishers,
traders, exporters and marketers of diamonds, as well as gold and diamond
jewelry.
Almost sales are
for export.
Operating from
owned premises, on an area of 340 sq. meters, in 3A Jabotinsky Street, Diamond
Exchange, Yahalom Bldg. (13th floor, suit 1372), Ramat Gan, Also
operating from branches in the U.S.A., Belgium, Germany, Japan, China and Hong
Kong.
Having between 80
-100 employees.
MEANS
Financial data not
forthcoming, known to be financially solid.
There are 6 charges
for unlimited amounts registered on the company's assets, in favor of Israel
Discount Bank Ltd., Union Bank of Israel Ltd. and Bank Leumi Le’Israel Ltd.
(last 3 charges placed June 2008).
REVENUES
· 2010 sales claimed to be US$ 70,000,000, almost 100% for export.
· 2011 sales claimed to be US$ 70,000,000, almost 100% for export.
According to the data published by the
Israel Supervisor on Diamonds in the Ministry of Industry & Trade, export
of polished diamonds by subject (as seen above, actual overall sales are
higher, as there sales of jewelry and of rough diamonds as well), were as
follows:
·
2009 sales
for export (net) were US$ 61,000,000.
·
2010 sales
for export (net) were US$ 55,000,000.
OTHER COMPANIES
Also in subject's
Group:
· A. SCHWARTZ & SONS LTD., Hong Kong,
· A. SCHWARTZ - RAMIS, Pforzheim, Germany,
· SCHWARTZ JAPAN CO., Tokyo, Japan,
·
A. SCHWARTZ & SONS DIAM
· NY - URI SCHWARTZ & SONS LTD., New York, U.S.A.
BANKERS
Israel Discount Bank
Ltd., Diamonds Exchange Branch (No. 080), Ramat Gan, account No. 600888.
A check with the
Central Banks’ database did not reveal anything detrimental on subject’s a/m
account.
CHARACTER AND REPUTATION
Nothing
unfavorable learned.
Subject among Israel’s
leading diamond manufacturers.
This is a veteran
family diamond business. Late Aharon Schwartz who founded subject as a lapidary
factory, received in 1990 the local Diamond Industry honorary award of the
industry’s notable person. In 1963 he received a Sight from CSO. He passed away
in 2002 and business continued by his sons.
Uri Schwartz, son
of Aharon, served 3 terms as the President of the Diamonds Industrialists’
Association (2 consecutive terms 1988-1994 and 2001-2004) and is still an
honorary president. He started to deal in diamonds in 1969. Also was twice
elected for the Diamond Exchange Board and contributed to the industry in
various ways. Uri Schwartz was among the founders the Gemological Institute at
the local Diamond Institute (WGI) in 2007.
According to the
report published by the Israel Supervisor on Diamonds in the Ministry of
Industry and Trade, subject was ranked 12th in the 2010 list of
Israel's largest polished diamonds exporters, and 7th in 2009.
According to the President
of the Israeli Diamonds Association, local diamond sector in general managed to
cross the global economic crisis that erupted in September 2008, one of worst
depressions in the global diamond sector, despite the sheer difficulties,
including the fact that local banks contracted credit given to local diamond
firms. The President said that trade in the sector rolls annual turnover of US$
25 billion while total debt to the banks stands on US$ 1.5 billion, down from
US$ 2.4 billion in the eve of the crisis. The Ministry for Industry & Trade
also assisted the local diamond exporters by providing bank guarantees in total
scope of NIS 1 billion.
The diamond sector
experienced almost an entire freeze and collapse in sales of about 70% in the
peak of the crisis and 2009 export diamonds shrank by some 40%. Only since mid
Overall in 2010,
export (net) of polished diamonds was US$ 5,832 million, representing 48%
increase from 2009 (when it noted 37% decrease from 2008, also much less than
In the first 9
months of 2011, 37.1% increase was noted comparing to the parallel period in
2010 with net export of polished diamonds of US$5.830 million. Export of
rough diamonds also climbed almost 32%, reaching US$ 2,980 million.
Import of rough
diamonds (net) in 2010 grew by 51% to US$ 3,755 million (30% rise in karat
terms) compared with 2009, and by 35% in the first 9 months of 2011 (compared
to 2010) summing up to US$3,520 million. Import of polished diamonds (net) saw
68% rise in 2010 reaching US$ 4,218 million (39% rise in karat terms), and
almost 49% rise in 2011 first 9 months
(US$ 4,170 million).
In terms of target
export (polished diamonds) countries, overall in 2010 the USA returned to be
main destination, with 41% of total export (37% in 2011). This comes after
earlier in 2010, for the first time Far East markets became Israel’s diamond
industry’s main target, with sales to Hong Kong being close to these of the
USA, to whom sales decreased dramatically in view of the severe economic crisis
(traditionally sales to the USA comprised some 60%-65% of total export). In
2011, export to Hong Kong comprised around 29% of sales. Other main target
countries include Belgium, Switzerland, India, Thailand and China.
In February 2009,
Israel was ranked as the world’s largest exporter of cut diamonds, followed by
India, Belgium and South Africa.
SUMMARY
Good for trade
engagements.
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.
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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.
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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
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Currency |
Unit
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Indian Rupees |
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US Dollar |
1 |
Rs.52.67 |
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UK Pound |
1 |
Rs.82.53 |
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Euro |
1 |
Rs.69.13 |
RATING EXPLANATIONS
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RATING |
STATUS |
PROPOSED CREDIT LINE |
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>86 |
Aaa |
Possesses an extremely sound financial base with the strongest
capability for timely payment of interest and principal sums |
Unlimited |
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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 |
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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 |
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41-55 |
Ba |
Overall operation is considered normal. Capable to meet normal
commitments. |
Satisfactory |
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26-40 |
B |
Capability to overcome financial difficulties seems comparatively
below average. |
Small |
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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 |
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<10 |
C |
Absolute credit risk exists. Caution needed to be exercised |
Credit not
recommended |
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NB |
New Business |
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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.