MIRA INFORM REPORT

Report Date :

17.06.2011

IDENTIFICATION DETAILS

Name :	THANGAM LTD.

Registered Office :	Diamond Exchange, Yahalom Bldg., Ramat Gan 52521 Israel

Country :	Israel

Date of Incorporation :	11.05.1987.

Legal Form :	A Private Limited Company

Line of Business :	Traders, importers, exporters and marketers of diamonds of all sorts.

RATING & COMMENTS

MIRA’s Rating :

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

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 – March 31^st, 2011

Country Name

Previous Rating

(31.12.2010)

Current Rating

(31.03.2011)

Israel

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

Company Name and address

THANGAM LTD.

Telephone 972 3 613 15 70

Fax 972 3 575 28 97

54 Bezalel Street

Diamond Exchange, Yahalom Bldg.

RAMAT GAN 52521 ISRAEL

HISTORY & LEGAL FORMATION

A private limited company, incorporated as per file No. 51-119805-3 on the 11.05.1987.

SHARE CAPITAL

Authorized share capital of NIS 2,640.00, divided into:

2,640 ordinary shares, of NIS 1.00 each,

of which 100 shares amounting to NIS 100.00 were issued.

SHAREHOLDERS

1. Tiargraj Thiagrajan, 99%,

2. Ms. Indira Thiagrajan, 1%, both of 16, Baltimore Street, Tel Aviv.

SOLE DIRECTOR & GENERAL MANAGER

Tiargraj Thiagrajan

BUSINESS

Traders, importers, exporters and marketers of diamonds of all sorts.

Operating from rented offices, on an area of 60 sq. meters, in 54 Bezalel Street (also referred as 21 Tuval Street), Diamond Exchange, Yahalom Building (6^th Floor, room No. 662), Ramat Gan. Offices shared with affiliated company PARK DIAM).

Having 5 employees (same as in previous years).

MEANS

Financial data not forthcoming.

There are 3 charges for unlimited amounts registered on the company's assets, in favor of Union Bank of Israel Ltd. and The State Bank of India.

ANNUAL SALES

Sales figures not forthcoming.

BANKERS

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

account No. 632000/02.

A check with the Central Banks’ database did not reveal any negative information regarding subject’s a/m account.

CHARACTER AND REPUTATION

Nothing unfavorable learnt.

Subject's officials refused to disclose financial data on their company.

This is a long established company.

There is another diamond dealers company PARK DIAM ISR. LTD. which shares telephone number and offices with subject. Subject’s officials refused to relate to this point, only that there is a certain affiliation (we assume it is also a family affiliation, via the Thiagrajan family).

During 2010 local diamond companies have been recovering from one of the worst depressions in the global diamond sector due to the severe economic crisis in global markets that erupted in September 2008. 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 2009 a mild recovery has been felt (in some markets, such as the American, it is estimated that it will take long time till fully recovering) and continued throughout 2010.

According to the President of the Israeli Diamonds Association, local diamond sector in general managed to cross the crisis, 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.

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 2007, a record year in polished diamonds export, with sales of US$ 7,076 million). In karat terms, net export of polished diamonds rose by 32%. Rough diamonds export (net) reached US$ 3,060 million, 62% up from 2009 and 36% increase in karat terms.

Import of rough diamonds (net) in 2010 grew by 51% to US$ 3,755 million (30% rise in karat terms), compared with 2009, while import of polished diamonds (net) saw 68% rise reaching US$ 4,218 million (39% rise in karat terms).

In terms of target export (polished diamonds) countries, overall in 2010 the USA returned to be main destination, with 41% of total export. 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 all 2010, export to Hong Kong comprised 25.5% of sales. Other target countries included India (4.5%), Switzerland (4%) and China (3%).

In February 2009, Israel was ranked as the world’s largest exporter of cut diamonds, followed by India, Belgium and South Africa.

SUMMARY

Notwithstanding the refusal to disclose financial details, considered good for trade engagements.

FOREIGN EXCHANGE RATES

Currency	Unit	Indian Rupees
US Dollar	1	Rs.44.90
UK Pound	1	Rs.72.54
Euro	1	Rs.63.39

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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This report is issued at your request without any risk and responsibility on the part of MIRA INFORM PRIVATE LIMITED (MIPL) or its officials.