MIRA INFORM REPORT

Report Date :

17.08.2012

IDENTIFICATION DETAILS

Name :	S. S. DIAM CO., LTD.
Registered Office :	16^th Floor, Bangkok Gems & Jewelry Tower, 322/33 Surawong Road, Siphya, Bangrak, Bangkok 10500,
Country :	Thailand
Financials (as on) :	31.12.2011
Date of Incorporation :	24.05.2006
Com. Reg. No.:	0105549063670
Legal Form :	Private Limited Company
Line of Business :	Importer and Distributor of Diamonds and Gemstones
No. of Employees :	2

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
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, 2012

Country Name	Previous Rating (31.12.2011)	Current Rating (31.03.2012)
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

S. S. DIAM CO., LTD.

SUMMARY

BUSINESS ADDRESS : 16^th FLOOR, BANGKOK GEMS & JEWELRY TOWER,

322/33 SURAWONG ROAD, SIPHYA, BANGRAK,

BANGKOK 10500, THAILAND

TELEPHONE : [66] 2235-3868

FAX : [66] 2235-3868

E-MAIL ADDRESS : -

REGISTRATION ADDRESS : SAME AS BUSINESS ADDRESS

ESTABLISHED : 2006

REGISTRATION NO. : 0105549063670

TAX ID NO. : 3032217101

CAPITAL REGISTERED : BHT. 4,000,000

CAPITAL PAID-UP : BHT. 4,000,000

SHAREHOLDER’S PROPORTION : THAI : 51.00%

INDIAN : 49.00%

FISCAL YEAR CLOSING DATE : DECEMBER 31

LEGAL STATUS : PRIVATE LIMITED COMPANY

EXECUTIVE : MR. SHAILESH KUMAR CHAMPAKLAL MODI, INDIAN

MANAGING DIRECTOR

NO. OF STAFF : 2

LINES OF BUSINESS : DIAMONDS AND GEMSTONES

IMPORTER AND DISTRIBUTOR

CORPORATE PROFILE

OPERATING TREND : STABLE

PRESENT SITUATION : OPERATING NORMALLY

REPUTATION : FAIR WITH NORMAL BUSINESS ENGAGEMENT

MANAGEMENT STANDARD : MANAGEMENT WITH FAIR PERFORMANCE

HISTORY

The subject was established on May 24, 2006 as a private limited company under the name style S. S. DIAM CO., LTD., by Thai and Indian groups, with the business objective to import and distribute diamonds and gemstones for jewelry business. It currently employs 2 staff.

The subject’s registered address was initially located at Unit E2, 11^th Floor, Bangkok Gems & Jewelry Tower, 322/16 Surawong Rd., Siphya, Bangrak, Bangkok 10500.

On January 15, 2010, subject’s registered address was relocated to 16^th Floor, Bangkok Gems & Jewelry Tower, 322/33 Surawong Rd., Siphya, Bangrak, Bangkok 10500, and this is the subject’s current operation address.

THE BOARD OF DIRECTORS

Name	Nationality	Age
Mr. Shailesh Kumar Champaklal Modi	Indian	52
Mr. Mohak Deepak Shah	Indian	24

AUTHORIZED PERSON

One of the above directors can sign on behalf of the subject with company’s affixed.

MANAGEMENT

Mr. Shailesh Kumar Champaklal Modi is the Managing Director

He is Indian nationality with the age of 52 years old.

BUSINESS OPERATIONS

The subject is engaged in importing and distributing of diamonds and gemstones for jewelry business.

IMPORT

100% of the products is imported from India, Hong Kong and South Africa.

SALES

The products are sold locally by wholesale to traders and manufacturers.

SUBSIDIARY AND AFFILIATED COMPANY

The subject is not found to have any subsidiary 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.

Imports are by L/C at sight or T/T.

BANKING

The banker’s name was not disclosed.

EMPLOYMENT

The subject employs 2 staff.

LOCATION DETAILS

The premise is rented for administrative office at the heading address. Premise is located in a prime commercial area.

COMMENT

Current market of diamond and gemstones is promising. The subject reported moderate sales in 2011. However, jewelry industry expansion in export market has resulted to rising demand of diamond and gemstones from local traders.

FINANCIAL INFORMATION

The capital was registered at Bht. 4,000,000 divided into 40,000 shares of Bht. 100 each with fully paid.

THE SHAREHOLDERS LISTED WERE : [as at April 30, 2012]

NAME	HOLDING	%
Mr. Shailesh Kumar Champaklal Modi Nationality: Indian Address : 322/33 Surawong Rd., Siphya, Bangrak, Bangkok	19,000	47.50
Mr. Chairith Vasinsombat Nationality: Thai Address : 42/46 Moo 17, Salathammasop, Taweewattana, Bangkok	4,080	10.20
Ms. Rudee Chaloke Nationality: Thai Address : 99/6 Moo 3, Krasaeng, Samkok, Pathumthani	4,080	10.20
Ms. Mananchaya Pathisut Nationality: Thai Address : 86/115 Moo 9, Dokmai, Prawet, Bangkok	4,080	10.20
Ms. Savitree Mahamad Nationality: Thai Address : 43/1 Moo 4, Klongnueng, Klongluang, Pathumthani	4,080	10.20
Ms. Pia Nirongbutra Nationality: Thai Address : 1/5 Moo 10, Dantako, Jombueng, Ratchburi	4,080	10.20
Mr. Mohak Deepak Shah Nationality: Indian Address : 322/33 Surawong Rd., Siphya, Bangrak, Bangkok	600	1.50

Total Shareholders : 7

Shareholders Structure [as at April 30, 2012]

Nationality	Shareholders	No. of Share	% Shares
Thai	5	20,400	51.00
Foreign - Indian	2	19,600	49.00
Total	7	40,000	100.00

NAME OF AUDITOR & CERTIFIED PUBLIC ACCOUNTANT NO. :

Mr. Suthep Trakulvichai No. 7183

BALANCE SHEET [BAHT]

The latest financial figures published for December 31, 2011 & 2010 were:

ASSETS

Current Assets	2011	2010
Cash and Cash Equivalents	298,283.46	30,777.35
Trade Accounts & Other Receivable	28,887,640.96	18,056,980.89
Inventories	26,389,194.75	31,254,618.17
Short-term Lending to Other Company	-	1,700,000.00
Other Current Assets	70,703.14	67,667.98
Total Current Assets	55,645,822.31	51,110,044.39
Fixed Assets	1,420.04	20,081.16
Other Non current Assets	9,000.00	7,000.00
Total Assets	55,656,242.35	51,137,125.55

LIABILITIES & SHAREHOLDERS’ EQUITY [BAHT]

Current Liabilities	2011	2010
Trade Accounts & Other Payable	32,397,076.26	33,950,811.47
Accrued Income Tax	41,643.57	-
Other Current Liabilities	73,550.00	166,798.44
Total Current Liabilities	32,512,269.83	34,117,609.91
Long-term Loan from Related Person	17,271,638.13	11,731,638.13
Total Liabilities	49,783,907.96	45,849,248.04
Shareholders' Equity
Share capital : Baht 100 value authorized, issued and fully paid share capital 40,000 shares	4,000,000.00	4,000,000.00
Capital Paid	4,000,000.00	4,000,000.00
Retained Earning - Unappropriated	1,872,334.39	1,287,877.51
Total Shareholders' Equity	5,872,334.39	5,287,877.51
Total Liabilities & Shareholders' Equity	55,656,242.35	51,137,125.55

PROFIT & LOSS ACCOUNT

Revenue	2011	2010
Sales	28,736,664.12	25,006,457.66
Other Income	-	1,030,510.59
Total Revenues	28,736,664.12	26,036,968.25
Expenses
Cost of Goods Sold	25,639,907.02	23,990,303.45
Selling Expenses	44,739.40	111,775.05
Administrative Expenses	2,389,017.25	1,078,679.47
Total Expenses	28,073,663.67	25,180,757.97
Profit / [Loss] before Income Tax	663,000.45	856,210.28
Income Tax	[78,543.57]	[106,039.54]
Net Profit / [Loss]	584,456.88	750,170.74

FINANCIAL ANALYSIS

ITEM	UNIT	2011	2010
LIQUIDITY RATIO
CURRENT RATIO	TIMES	1.71	1.50
QUICK RATIO	TIMES	0.90	0.53
ACTIVITY RATIO
FIXED ASSETS TURNOVER	TIMES	20,236.52	1,245.27
TOTAL ASSETS TURNOVER	TIMES	0.52	0.49
INVENTORY CONVERSION PERIOD	DAYS	375.67	475.52
INVENTORY TURNOVER	TIMES	0.97	0.77
RECEIVABLES CONVERSION PERIOD	DAYS	366.92	263.56
RECEIVABLES TURNOVER	TIMES	0.99	1.38
PAYABLES CONVERSION PERIOD	DAYS	461.19	516.54
CASH CONVERSION CYCLE	DAYS	281.39	222.54
PROFITABILITY RATIO
COST OF GOODS SOLD	%	89.22	95.94
SELLING & ADMINISTRATION	%	8.47	4.76
INTEREST	%	-	-
GROSS PROFIT MARGIN	%	10.78	8.18
NET PROFIT MARGIN BEFORE EX. ITEM	%	2.31	3.42
NET PROFIT MARGIN	%	2.03	3.00
RETURN ON EQUITY	%	9.95	14.19
RETURN ON ASSET	%	1.05	1.47
EARNING PER SHARE	BAHT	14.61	18.75
LEVERAGE RATIO
DEBT RATIO	TIMES	0.89	0.90
DEBT TO EQUITY RATIO	TIMES	8.48	8.67
TIME INTEREST EARNED	TIMES	-	-
ANNUAL GROWTH
SALES GROWTH	%	14.92
OPERATING PROFIT	%	(22.57)
NET PROFIT	%	(22.09)
FIXED ASSETS	%	(92.93)
TOTAL ASSETS	%	8.84

PROFITABILITY RATIO

Gross Profit Margin	10.78	Impressive	Industrial Average	9.66
Net Profit Margin	2.03	Impressive	Industrial Average	(0.20)
Return on Assets	1.05	Impressive	Industrial Average	(0.27)
Return on Equity	9.95	Impressive	Industrial Average	(0.72)

Gross Profit Margin used to assess a firm's financial health by revealing the proportion of money left over from revenues 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 10.78%. When compared with the industry average, the ratio of the company was higher, this indicated that company was more profitable than the same industry.

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 2.03%, 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 1.05%, 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 9.95%, 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 Uptrend

Return on Equity Stable

LIQUIDITY RATIO

Current Ratio	1.71	Satisfactory	Industrial Average	1.72
Quick Ratio	0.90
Cash Conversion Cycle	281.39

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 1.71 times in 2011, increased from 1.5 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 0.9 times in 2011, increased from 0.53 times, by excluding inventory, the company may have problems meeting current liabilities.

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 282 days.

Trend of the average competitors in the same industry for last 5 years

Current Ratio Downtrend

LEVERAGE RATIO

Debt Ratio	0.89	Acceptable	Industrial Average	0.60
Debt to Equity Ratio	8.48	Risky	Industrial Average	1.67
Times Interest Earned	-		Industrial Average	0.63

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.

Debt Ratio shows the proportion of a company's assets which are financed through debt. The company's figure is 0.89 greater than 0.5, most of the company's assets are financed through debt.

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	20,236.52	Impressive	Industrial Average	10.73
Total Assets Turnover	0.52	Deteriorated	Industrial Average	1.47
Inventory Conversion Period	375.67
Inventory Turnover	0.97	Deteriorated	Industrial Average	2.17
Receivables Conversion Period	366.92
Receivables Turnover	0.99	Deteriorated	Industrial Average	3.31
Payables Conversion Period	461.19

Trend of the average competitors in the same industry for last 5 years

Fixed Assets Turnover Uptrend

Total Assets Turnover Downtrend

Inventory Turnover Downtrend

Receivables Turnover Downtrend

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.55.99
UK Pound	1	Rs.87.55
Euro	1	Rs.68.68

INFORMATION DETAILS

Report Prepared by :

PRL

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%)

PRIVATE & CONFIDENTIAL : This information is provided to you at your request, you having employed MIPL for such purpose. You will use the information as aid only in determining the propriety of giving credit and generally as an aid to your business and for no other purpose. You will hold the information in strict confidence, and shall not reveal it or make it known to the subject persons, firms or corporations or to any other. MIPL does not warrant the correctness of the information as you hold it free of any liability whatsoever. You will be liable to and indemnify MIPL for any loss, damage or expense, occasioned by your breach or non observance of any one, or more of these conditions

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