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Report Date : |
27.11.2012 |
IDENTIFICATION DETAILS
|
Name : |
KGK DIAMONDS (HK) LTD |
|
|
|
|
Registered Office : |
14/F., Chevalier House, |
|
|
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Country : |
|
|
|
|
|
Date of Incorporation : |
27.10.2000 |
|
|
|
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Reg. No.: |
31329946 |
|
|
|
|
Legal Form : |
Private Limited Company |
|
|
|
|
Line of Business : |
Manufacturer and Exporter of All kinds of diamonds. |
|
|
|
|
No. of Employees : |
33 |
RATING & COMMENTS
|
MIRA’s Rating : |
Ba |
|
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 – June 30th, 2012
|
Country Name |
Previous Rating (31.03.2011) |
Current Rating (30.06.2012) |
|
|
A2 |
A2 |
|
Risk Category |
ECGC
Classification |
|
Insignificant |
A1 |
|
Low |
A2 |
|
Moderate |
B1 |
|
High |
B2 |
|
Very High |
C1 |
|
Restricted |
C2 |
|
Off-credit |
D |
|
Source : CIA |
KGK DIAMONDS (HK)
LTD
14/F., Chevalier House, 45-51 Chatham Road South, Tsimshatsui, Kowloon,
Hong Kong.
PHONE: 2723 9828, 2733 0700
FAX: 2739 7584
E-MAIL: kgk.hk@kgkmail.com
kgkhk@kgkgroup.com
Managing Director: Mr. Sanjay
Navrattan Kothari
Incorporated on: 27th October, 2000
Organization: Private Limited Company.
Capital: Nominal: HK$90,000,000.00
Issued: HK$89,700,002.00
Business Category: Diamond
Trader.
Employees: 33. (Including associates in Hong Kong)
Main Dealing Banker: The Royal
Bank of Scotland N.V., Hong Kong Branch.
Banking Relation: Good.
KGK DIAMONDS
(HK) LTD.
Registered Head
Office:-
14/F., Chevalier House, 45-51 Chatham Road South, Tsimshatsui, Kowloon,
Hong Kong.
China Factory:-
KGK Jewellery Manufacturing Ltd.
Panyu, Guangdong Province, China.
[Tel: (86-20) 3480 6744, 3999
0700
Fax: (86-20) 3480 6749, 3480
6759
E-mail: jewchina@kgkgroup.com
entice@kgkmail.com]
Holding Company:-
United Pacific Excel Ltd., British Virgin Islands.
Associated/Affiliated
Companies:-
KGK Group of Companies
Far East Gems Inc., China.
K.G.K. Diamonds B.V.B.A., Belgium.
KGK Creation Guangzhou Ltd., China.
KGK Creations (India) Pvt. Ltd., India.
KGK Creations Pvt. Ltd., India.
KGK Diamond Israel Ltd., Israel.
KGK Diamonds & Jewellery LLC, UAE.
KGK Diamonds (Far East) Inc., Japan.
KGK Diamonds (India) Pvt. Ltd., India.
KGK Diamonds (Shanghai) Ltd., China.
KGK Diamonds (SZ) Co. Ltd., China.
KGK Diamonds Co. Ltd., Thailand.
KGK Diamonds LLC, USA.
KGK Enterprises, India.
KGK Entice Jewellery (Shenzhen) Ltd., China.
KGK Gems (HK) Ltd., Hong Kong.
KGK Gems Ltd., Thailand.
KGK Gems, India.
KGK Investment USA (HK) Ltd., Hong Kong.
KGK Jewellery (China) Ltd., Hong Kong.
KGK Jewellery (HK) Ltd., Hong Kong.
KGK Jewellery Inc., Japan.
KGK Jewellery Inc., USA.
KGK Jewellery LLC, USA.
KGK Jewellery Manufacturing Ltd., China.
KGK Jewellery Manufacturing Ltd., Hong Kong.
KGK Jewelry Inc., China.
KGK Jewelry Manufacturing Ltd., Japan.
KGK Jewelry Pvt. Ltd., India.
KGK Jewels (Pty) Ltd., South Africa.
KGK Mining (HK) Ltd., Hong Kong.
KGK Properties (HK) Ltd., Hong Kong.
KGK Real Estate (HK) Ltd., Hong Kong.
M.B.K. Diamonds GmbH, Germany.
Precious Trade Inc., USA.
S. D. Diamond LLC, Russia.
Star Rough Diamonds (Pty) Ltd., South Africa.
etc.
BUSINESS REGISTRATION
NUMBER
31329946
0735843
Managing Director: Mr. Sanjay
Navrattan Kothari
Nominal Share Capital: HK$90,000,000.00 (Divided into 90,000,000 shares
of HK$1.00 each)
Issued Share Capital: HK$89,700,002.00
(As per registry dated 27-10-2012)
|
Name |
|
No. of shares |
|
United Pacific Excel Ltd. 263 Main Street, P.O. Box 2196, Road Town, Tortola, British Virgin
Islands. |
|
88,000,000 |
|
Sanjay Navrattan KOTHARI |
|
1,700,001 |
|
Manju KOTHARI |
|
1 |
|
|
|
––––––––– |
|
|
Total: |
89,700,002 ======== |
(As per registry dated 27-10-2012)
|
Name (Nationality) |
Address |
|
Manju KOTHARI |
House A, 8623 Tai Po Road, Shatin, New Territories, Hong Kong. |
|
Sanjay Navrattan KOTHARI |
House A, 8623 Tai Po Road, Shatin, New Territories, Hong Kong. |
(As per registry dated 27-10-2012)
|
Name |
Address |
Co. No. |
|
Louis Lai Co. Secretarial Services Ltd. |
9/F., Surson Commercial Building, 140-142 Austin Road, Tsimshatsui,
Kowloon, Hong Kong. |
0686503 |
The subject was incorporated on 27th October, 2000 as a private limited
liability company under the Hong Kong Companies Ordinance.
Apart from these, neither material change nor amendment has been ever
traced and noted.
Activities: Manufacturer
and Exporter.
Lines: All kinds of
diamonds.
Brand Name: “Entice”.
Employees: 33. (Including associates in Hong Kong)
Raw Materials: Imported
from India, other Asiann countries, Europe, etc.
Markets: Japan, US, UAE,
South Korea, Australia, Middle East, South Africa, etc.
Terms/Sales: L/C, T/T or as per contracted.
Terms/Buying: L/C, T/T, D/P, etc.
Diamond Federation of Hong Kong, China Ltd., Hong Kong.
The Indian Chamber of Commerce Hong Kong, Hong Kong.
Hong Kong Jewelry Manufacturers’ Association, Hong Kong.
Nominal Share Capital: HK$90,000,000.00 (Divided into 90,000,000 shares
of HK$1.00 each)
Issued Share Capital: HK$89,700,002.00
Alternation of Capital:-
|
Initially |
paid up |
HK$ 46,800,002.00 |
|
27-02-2009 |
paid up |
HK$ 11,700,000.00 |
|
04-03-2010 |
paid up |
HK$ 31,200,000.00 |
|
|
|
–––––––––––––––– |
|
Total: |
paid up |
HK$ 89,700,002.00 ============== |
Increase of Nominal Capital:-
|
From |
HK$60,000,000.00 |
to |
HK$90,000,000.00 |
on |
04-01-2010 |
Mortgage or Charge:-
Date of Debenture: 27-05-2005
Amount: In consideration
of ABN AMRO Bank N.V. agreeing to grant general banking facilities to KGK
Diamonds (HK) Ltd.
Property: All the Company’s
undertaking and rpoperty and assets whatsoever and wheresoever both present and
future including all book and other debts revenues and claims
Mortgagee: ABN AMRO Bank
N.V., Hong Kong Branch. [Now known
as The Royal Bank of Scotland N.V.]
Profit or Loss: Operation
is conducted on a profitable basis.
Condition: Kept in an active manner.
Facilities: Is making use of general
banking facilities.
Payment: Correctly met.
Commercial Morality: Good.
The Royal Bank of Scotland N.V., Hong Kong Branch.
Standard Chartered Bank (Hong Kong) Ltd., Hong Kong.
Standing: Very Good.
KGK Diamonds (HK) Ltd. is a subsidiary company of United Pacific Excel
Ltd. which is a BVI-registered firm. The
subject in fact is a member of the KGK Group which is trading in diamond and
related products. It increased its
issued share capital in March 2010.
The subject is trading in the Group’s products. It has got a main associated company located
at its operating address known as KGK Jewellery (HK) Ltd., a Hong
Kong-registered firm managed by the same personnel. The subject has set up at least six retailing
outlets in Hong Kong which are retailing the products of the KGK Group.
The KGK Group is a global corporation based in India with fully
integrated operations in diamonds, coloured gemstones and jewellery. From procurement to manufacturing and from
marketing to retailing, the Group is present across the full value chain of the
industry with offices spread across the world.
Established in 1905, KGK group is one of the oldest Gemstone Houses of
India. It has its own manufacturing
setup in India, China, South Africa and Russia.
Being a DTC Sightholder, KGK receives its rough directly from DTC.
KGK has its presence in 14 countries, covering major market
globally. KGK deals in diamonds of all
sizes, cut and clarity. KGK also has its fine Jewellery manufacturing units
which is specialized in commercial to high end range products.
KGK’s diamond operation started in 1969 with diamonds trading and
diamond manufacturing activities began in 1982.
Initially KGK was sourcing its rough diamonds from Antwerp which is the
world’s diamond capital. In 1997, KGK
became the DTC Sightholder and started getting rough diamonds directly from
London in addition to Antwerp. In 2005,
KGK got sight in South Africa. This has
facilitated KGK to produce more competitive and cost effective polish diamonds.
KGK has set up marketing offices in all important cities in the world,
and has set up manufacturing units in India, Thailand, China, South Africa and
Russia. These factories have modern
machines for diamond cutting and polishing operated by trained craftsmen. The stones are then assorted and graded into
different lots as per their cut, colour, clarity and size. The Group sources its diamonds and colour
stones from different parts of the world through its offices in Antwerp,
London, Russia and South Africa. The Group
opened its offices in the UAE, Germany, Spain, London, etc.
KGK Group is headed by Mr. Navrattan Kothari, who is the Group
Chairman. Each division of the group is
headed by senior members of the Kothari family who have wide ranging experience
in the industry. The Gemstones business
is managed by Mr. Vinay Kothari and Mr. Prakash Kothari, while the Diamonds and
Jewellery business is under the supervision of Mr. Surendra Kothari,
Mr. Sanjay Kothari, Mr. Sandeep Kothari and Mr. Prashant Kothari.
Currently, the subject is manufacturing the following commodities and
offering clients with the following services:-
|
Product/Service |
Product/Service Remarks |
|
Jewellery – Diamond |
Include precious stones from India, Thailand, Belgium and Israel
(Importer) |
|
Gemstones and Jade |
Precious stones (Manufacturer) Precious stones (Exporter) Precious stones from India and Thailand (Importer) |
|
Diamond |
From India, Thailand, Belgium and Israel (Importer) |
The Group now has set up a factory in Panyu Guangdong Province, China
employing about 300 persons. The factory
is specialised in diamond jewellery, magnetics and reversibles. In 2004, the subject developed its own brand
name “Entice” which is widely known in Hong Kong, the Middle East and
Belgium.
In China, the
Group has had the following firms:-
KGK Diamonds (Shanghai) Ltd.
KGK Diamonds (SZ) Co. Ltd.
KGK Jewellery Manufacturing Ltd.
Besides the Panyu factory, the Group’s other diamond manufacturing
plants are located in India and South Africa.
In these factories, KGK is able to manufacture quality diamonds in a
range of sizes (0.005 to 5.00 ct.), shapes, qualities (VVS1 to PK), colour and
clarity.
The Group’s gemstones such as emeralds, tanzanites, rubies and sapphires
are manufactured by its factories in Jaipur, Thailand and Sri Lanka.
The Jaipur factory of the Group produces jewellery for KGK’s own
showroom and the domestic market.
The Group’s products are exported to Japan, other Asian countries, the
Middle East, North America and Western Europe.
Overall business is active.
The foundation of the KGK Group was laid in the year 1905, when Mr. Shri
Keshrimalji Kothari started trading in coloured gemstones simultaneously from
India and Burma. Assisted by his son,
Mr. Shri Ghisilalji Kothari, the business expanded from Jaipur to Chennai, and
then to Hong Kong. By the 1970’s with
new leadership at the helm of the Group, the business operations diversified
into diamonds and to new global locations such as the United States,
Thailand, Japan, etc. Now KGK Group has
had business concerns in fourteen countries of the world.
In July 2009, Martin Flyer Ltd. [Martin Flyer], a US-based firm,
confirmed its partnership and strategic alliance with KGK Group. This partnership has given Martin Flyer
access to additional diamond supplies to fulfil its needs and grow its brands
according to future plans.
In order to penetrate the international market further, KGK Group has
taken part in fairs and exhibitions held in Hong Kong and other foreign large
cities.
It has taken part in the following shows:-
United States
·
JCK Las Vegas Show
Europe
·
Baselworld, Switzerland
Hong Kong
·
HK International Jewellery Show
·
HK Jewellery & Gem Fair
China
·
Shenzhen International Jewellery Fair
Asia (other than Hong Kong and China)
·
International Jewellery Tokyo, Japan
·
Bangkok Gems & Jewelry Fair, Thailand
·
Jaipur Jewellery Show
·
India International Show
·
Bangkok Gems & Jewelry Fair, Thailand
Middle East
·
Dubai International Jewellery Show
The overall business of the subject in Hong Kong is active and
satisfactory. The subject is fully
supported by the KGK Group. It is
sharing the same office with its associated companies KGK Jewellery
Manufacturing Ltd. and KGK Jewellery (HK) Ltd.
To our knowledge, the total income of KGK Diamonds (India) Pvt. Ltd.
ranges from Rs. 11,000 to 13,000 million.
The consolidated turnover of the Group is very significant. However, the profit margin of the Group is
low.
The history of the subject in Hong Kong is over twelve years.
On the whole, consider it good for normal business engagements.
Property information of the company and director:-
1. Property Location: Flat 8 on 14/F. and Flat I on 18/F.,
Star Mansion, 3 Minden Row, Kowloon, Hong Kong.
Owner: KGK Diamonds (HK) Ltd.
Date of Purchase: n.a.
Purchased Price: n.a.
Incumbrances:-
|
Date of Mortgage |
Amount
Consideration |
Mortgagee |
Nature |
|
23-05-2008 |
- |
ABN AMRO Bank N.V., Hong Kong Branch. [Now known as The Royal Bank of Scotland N.V.] |
Mortgage to secure general banking facilities granted to KGK Diamonds
(HK) Ltd. and KGK Jewellery Manufacturing Ltd. |
2. Property Location: 8/F., Robinson Garden Apartments, 3B
Robinson Road, Hong Kong.
Owner: Sanjay Navrattan Kothari
Date of Purchase: 25-05-1988
Purchased Price: HK$1,700,000 pt.
Incumbrances:-
|
Date of Mortgage |
Amount
Consideration |
Mortgagee |
Nature |
|
23-01-1996 |
- |
Belgian Bank, Hong Kong Branch.
[Business was taken over by Industrial & Commercial Bank of China (Asia)
Ltd.] |
Legal charge to secure banking facilities |
|
16-09-2003 |
- |
Fortis Bank Asia HK, Hong Kong Branch. [Name changed to Belgian Bank but the
business was taken over by Industrial & Commercial Bank of China (Asia)
Ltd.] |
Deed of variation of M/N 6509498 and legal further charge |
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.55.69 |
|
|
1 |
Rs.89.19 |
|
Euro |
1 |
Rs.72.10 |
INFORMATION DETAILS
|
Report
Prepared by : |
SDA |
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.