MIRA INFORM REPORT

 

 

Report Date :

22.03.2012

 

IDENTIFICATION DETAILS

 

Name :

YAAKOV LENSHIZKY

 

 

Registered Office :

1 Jabotinsky Street Diamond Exchange, Trading Hall Ramat Gan 5252001

 

 

Country :

Israel

 

 

Date of Incorporation :

August 2007

 

 

Legal Form :

Sole Proprietorship

 

 

Line of Business :

Traders, importers, marketers and exporters of polished diamonds.

 

 

No. of Employees :

2

 

 

RATING & COMMENTS

 

MIRA’s Rating :

Ca

 

RATING

STATUS

PROPOSED CREDIT LINE

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

 

Status :

Small Concern

Payment Behaviour :

Unknown

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 30, 2011

 

Country Name

Previous Rating

(30.06.2011)

Current Rating

(30.09.2011)

Israel 

A2

A2

 

Risk Category

ECGC Classification

Insignificant

 

A1

Low

 

A2

Moderate

 

B1

High

 

B2

Very High

 

C1

Restricted

 

C2

Off-credit

 

D

 

Company name and address

 

Y LENSHINZKY

 

Correct Name: YAAKOV LENSHIZKY

(Also trading as Y. LENSHIZKY)

Telephone                  972 54 397 98 38

Fax                            972 3 574 52 50

1 Jabotinsky Street

Diamond Exchange, Trading Hall

RAMAT GAN              5252001 -ISRAEL

 

 

HISTORY & LEGAL FORMATION

 

A sole proprietorship, established in 2007/8.

 

Operating under License Dealer number 051144418.

 

 

OWNERSHIP

 

Yaakov Lenshizky

 

GENERAL MANAGER

 

Yaakov Lenshizky

 

 

BUSINESS

 

Traders, importers, marketers and exporters of polished diamonds.

 

Operating from the Diamond Exchange Trading Hall, in 1 Jabotinsky Street, Diamond Exchange, Ramat Gan.

 

Having 2 employees (including owner).

 

 

MEANS

 

Financial data not forthcoming.

 

REVENUES

 

Sales figures not forthcoming.

 

 

BANKERS

 

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

 

 

CHARACTER AND REPUTATION

 

Nothing unfavorable learnt.

 

Mr. Yaakov Lenshizky refused to disclose financial data.

 

In previous interviews Mr. Lenshizky told us he is veteran diamond branch, but did not wish to elaborate in what form he used to work prior to establishing subject (i.e. as a salaried employee or partner/ shareholder in a firm).

 

A recent affair of an underground bank is shocking the local diamond branch in these days, after in late January 2012 Police raided the Diamond Exchange (after a long undercover operation, in cooperation with the Exchange officials), arrested several individuals for investigation and blocked several bank accounts (which led to a chain reaction of not respecting checks of dealers). The Police suspect that a group of people, including diamond dealers, run an illegal bank in the Diamond Exchange compound for loans, money transfer abroad and exchange in volume of NIS 1 billion for several years. The affair has already led to couple of reported bankruptcies of local diamond firms, significant decrease in transactions (especially in purchase of raw diamonds) and a very bad general atmosphere which casts on the whole branch, as dealers –local and foreign- face uncertainty.

 

Despite the slow-down in activity in the global diamond branch during the last third of 2011, export by the local diamond sector in all 2011 recorded US$ 7,202 million sales in cut diamonds, 23.5% higher than in 2010. This was thanks to the strong first 2 thirds of 2011, which were stalled in the last third, reflecting the current fragile global economy and fear of another recession wave in USA and Europe. It should be noted that in karat terms, net export of cut diamonds rose only by 4% from 2010.

Export of rough diamonds in 2011 also climbed almost 15%, reaching US$ 3,515 million (fell almost 29% in karat terms).

Import of cut diamonds in 2011 summed up to US$ 5,682 million, representing 34.7% increase comparing to 2010 (18% rise in karat terms), while import of rough diamonds rose by 17.5% from 2010, totaling US$ 4,413 million (11% fall in karat terms).

 

In 2010, export (net) of cut diamonds was US$ 5,832 million (up 48% from 2009, when it noted 37% decrease from 2008), rough diamonds export (net) reached US$ 3,060 million (62% rise from 2009). Import of rough diamonds (net) in 2010 grew by 51% to US$ 3,755 compared with 2009, and import of polished diamonds (net) saw 68% rise in 2010 reaching US$ 4,218 million.

 

In terms of target export (polished diamonds) countries, in 2011 the USA continued to be the main destination, with 39% of total export (41% in 2011). This comes after in early 2010, for the first time Far East markets became Israel’s diamond industry’s main target (traditionally sales to the USA comprised some 60%-65% of total export). Hong Kong is the 2nd largest target country, comprising 26% of sales in 2011 (29% in 2010). Other main target countries included Switzerland (6%), India (5%), UK (3%) and the rest of the World (21%).

 

According to the President of the Israeli Diamonds Association, local diamond sector in general managed to cross one of worst depressions in the global diamond sector caused by the global economic crisis in 2008/9. The 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%. 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.

Local diamond sector employs some 15,000 persons.

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 data, considered good for trade engagements.

 

 

NOTES

 

1.    The cellular phone number you provided (972 54 844 97 99) does not serve Yaakov Lenshizky anymore.

2.    Since the beginning of 2012 Israel Post started using a new area code method of 7 digits (the old method of 5 digits will still be valid till end of 2012).

 

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.50.59

UK Pound

1

Rs.80.34

Euro

1

Rs.67.14

 

 

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.