MIRA
INFORM REPORT
|
Report Date : |
13.09.2012 |
IDENTIFICATION DETAILS
|
Name : |
GAYATRI DIAMONDS CO., LTD. |
|
|
|
|
Registered Office : |
Room
A, 15th Floor,
|
|
|
|
|
Country : |
|
|
|
|
|
Financials (as on) : |
31.12.2011 |
|
|
|
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Date of Incorporation : |
2010 |
|
|
|
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Com. Reg. No.: |
0105553037530 |
|
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|
|
Legal Form : |
Private Limited Company |
|
|
|
|
Line of Business : |
Importer and Distributor of Diamonds |
|
|
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|
No. of Employees : |
02 |
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 |
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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 30, 2011
|
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 |
THAILAND - ECONOMIC OVERVIEW
With a well-developed
infrastructure, a free-enterprise economy, generally pro-investment policies,
and strong export industries, Thailand enjoyed solid growth from 2000 to 2007 -
averaging more than 4% per year - as it recovered from the Asian financial crisis
of 1997-98. Thai exports - mostly machinery and electronic components,
agricultural commodities, and jewelry - continue to drive the economy,
accounting for more than half of GDP. The global financial crisis of 2008-09
severely cut Thailand's exports, with most sectors experiencing double-digit
drops. In 2009, the economy contracted 2.3%. In 2010, Thailand's economy
expanded 7.8%, its fastest pace since 1995, as exports rebounded from their
depressed 2009 level. Steady economic growth at just below 4% during the first
three quarters of 2011 was interrupted by historic flooding in October and
November in the industrial areas north of Bangkok, crippling the manufacturing
sector and leading to a revised growth rate of only 0.1% for the year. The
industrial sector is poised to recover from the second quarter of 2012 onward,
however, and the government anticipates the economy will probably grow between
5.5 and 6.5% for 2012, while private sector forecasts range between 3.8% and
5.7%.
Source
: CIA
Company name
GAYATRI DIAMONDS
CO., LTD.
SUMMARY
BUSINESS ADDRESS : ROOM A, 15th FLOOR,
BANGKOK GEMS
& JEWELRY TOWER,
322/33 SURAWONG
ROAD, SIPHAYA,
BANGRAK, BANGKOK
10500, THAILAND
TELEPHONE : [66] 081
901-3007, 089 120-3007
FAX : [66] 2266-5576
E-MAIL ADDRESS : gayatridia2010@yahoo.com
REGISTRATION ADDRESS : SAME AS BUSINESS
ADDRESS
ESTABLISHED : 2010
REGISTRATION NO. : 0105553037530
TAX ID NO. : 3033851397
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. DINESH KUMAR
HIRABHAI MAVANI, INDIAN
MANAGING DIRECTOR
NO. OF STAFF : 2
LINES OF BUSINESS : DIAMONDS IMPORTER AND
DISTRIBUTOR
CORPORATE PROFILE
OPERATING TREND : STABLE
PRESENT SITUATION : OPERATING NORMALLY
REPUTATION : GOOD
WITH NORMAL BUSINESS
ENGAGEMENT
MANAGEMENT STANDARD : MANAGEMENT
WITH FAIR PERFORMANCE
HISTORY
The subject was
established on March
16, 2010 as
a private limited
company by a
joint venture between Thai and Indian
groups, under the registered
name GAYATRI DIAMONDS
CO., LTD., with
the business objective
to import and
distribute various kinds
of diamonds for
jewelry business in
Thailand. It currently
employs 2 staff.
The subject’s registered
address is Room A, 15th Flr., Bangkok
Gems & Jewelry
Tower, 322/33 Surawong Rd., Siphaya,
Bangrak, Bangkok 10500,
and this is
the subject’s current
operation address.
THE BOARD
OF DIRECTOR
|
Name |
|
Nationality |
Age |
|
|
|
|
|
|
Mr. Dinesh Kumar Hirabhai
Mavani |
|
Indian |
33 |
|
Mr. Mahesh Kumar Hirjibhai
Mavani |
|
Indian |
27 |
AUTHORIZED PERSON
Mr. Dinesh Kumar Hirabhai
Mavani can sign
on behalf of
the subject with
company’s affixed.
MANAGEMENT
Mr. Dinesh Kumar Hirabhai
Mavani is the
Managing Director.
He is Indian
nationality with the
age of 33
years old.
BUSINESS OPERATIONS
The subject is
engaged in importing
and distributing various
kinds of diamonds,
including brown & black
diamonds, fancy diamonds,
cut princess diamonds
and others for
jewelry trading and
manufacturing business.
The subject plans
to hire the
manufacturer to produce
fine jewelry with
10k, 14k and 18k
in white, yellow
and pink gold
for export to
Hong Kong. However, its export
business is currently
being a plan.
IMPORT
100% of the
products is imported
from India and
Hong Kong.
SALES
100% of the
products is sold
locally to wholesalers,
manufacturers and end-users.
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
D/A or T/T
on negotiated terms.
BANKING
The subject was
not disclosed its
banker’s name.
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
The subject’s business
performance as of
2011 was impressive
with higher sales
revenue and net
profit comparing to
the previous year.
This is resulted
by higher demand
of the products
from both local
and overseas customers.
Its business has moderately grown
with bright business
prospect.
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 May
16, 2012]
|
NAME |
HOLDING |
% |
|
|
|
|
|
Mr. Dinesh Kumar Hirabhai
Mavani Nationality: Indian Address : 322/33 Surawong
Rd., Siphaya,
Bangrak, Bangkok |
13,600 |
34.00 |
|
Mr. Patsakorn Pakdeesuk Nationality: Thai Address : 18/1
Moo 1, T. Nontathane, A. Nonedaeng,
Nakornratchasima |
6,800 |
17.00 |
|
Mrs. Patraporn Inmamuang Nationality: Thai Address : 16/1
Moo 6, T. Banpong,
A. Ngow, Lampang |
6,800 |
17.00 |
|
Ms. Arunrat Phueiam Nationality: Thai Address : 148
Krungthep-Kreetha Rd., Huamark,
Bangkapi, Bangkok |
6,800 |
17.00 |
|
Mr. Mahesh Kumar Hirjibhai
Mavani Nationality: Indian Address : 322/33 Surawong
Rd., Siphaya,
Bangrak, Bangkok |
6,000 |
15.00 |
Total Shareholders : 5
Share Structure [as
at May 16, 2012]
|
Nationality |
Shareholders |
No. of Share |
% Shares |
|
|
|
|
|
|
Thai |
3 |
20,400 |
51.00 |
|
Foreign-Indian |
2 |
19,600 |
49.00 |
|
Total |
5 |
40,000 |
100.00 |
NAME OF
AUDITOR & CERTIFIED
PUBLIC ACCOUNTANT NO. :
Ms. Piyaluck Soontawong No.
10794
BALANCE SHEET [BAHT]
The latest
financial figures published
for December 31,
2011 & 2010
were:
ASSETS
|
Current Assets |
2011 |
2010 |
|
|
|
|
|
Cash and Cash Equivalents |
96,580.57 |
195,919.63 |
|
Trade Accounts & Other Receivable |
17,614,314.92 |
6,271,046.08 |
|
Short-term Loan |
- |
3,300,000.00 |
|
Inventories |
12,145,963.35 |
400,911.71 |
|
Other Current Assets
|
4,000.00 |
139,926.89 |
|
|
|
|
|
Total Current Assets
|
29,860,858.84 |
10,307,804.31 |
|
Long-term Loan |
590,450.00 |
- |
|
Fixed Assets |
699,546.50 |
18,350.38 |
|
Total Assets |
31,150,855.34 |
10,326,154.69 |
LIABILITIES &
SHAREHOLDERS’ EQUITY [BAHT]
|
Current
Liabilities |
2011 |
2010 |
|
|
|
|
|
Trade Accounts & Other
Payable |
25,958,446.60 |
6,103,023.47 |
|
Current Portion of Long-term
Loans |
167,564.01 |
- |
|
Accrued Income Tax |
66,541.31 |
- |
|
Other Current Liabilities |
5,042.42 |
30,108.79 |
|
|
|
|
|
Total Current Liabilities |
26,197,594.34 |
6,133,132.26 |
|
|
|
|
|
Long-term Loan |
57,846.07 |
- |
|
Total Liabilities |
26,255,440.41 |
6,133,132.26 |
|
|
|
|
|
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 |
895,414.93 |
193,022.43 |
|
Total Shareholders' Equity |
4,895,414.93 |
4,193,022.43 |
|
Total Liabilities & Shareholders' Equity |
31,150,855.34 |
10,326,154.69 |
PROFIT &
LOSS ACCOUNT
|
Revenue |
2011 |
March 16,
2010 – Dec. 31,
2010 |
|
|
|
|
|
Sales |
37,742,115.78 |
10,774,319.48 |
|
Other Income |
16,532.60 |
13,012.55 |
|
Total Revenues |
37,758,648.38 |
10,787,332.03 |
|
Expenses |
|
|
|
|
|
|
|
Cost of Goods
Sold |
33,564,720.20 |
9,958,720.06 |
|
Selling Expenses |
416,871.16 |
20,850.00 |
|
Administrative Expenses |
2,972,511.75 |
605,572.73 |
|
Total Expenses |
36,954,103.11 |
10,585,142.79 |
|
|
|
|
|
Profit / Loss] before Financial
Costs & Income Tax |
804,545.27 |
202,189.24 |
|
Financial Costs |
[1,051.88] |
[1,180.00] |
|
|
|
|
|
Profit / [Loss] before Income Tax |
803,493.39 |
201,009.24 |
|
Income Tax |
[99,166.31] |
[7,986.81] |
|
Net Profit / [Loss] |
704,327.08 |
193,022.43 |
FINANCIAL ANALYSIS
|
ITEM |
UNIT |
2011 |
2010 |
|
|
|
|
|
|
LIQUIDITY RATIO |
|
|
|
|
CURRENT RATIO |
TIMES |
1.14 |
1.68 |
|
QUICK RATIO |
TIMES |
0.68 |
1.59 |
|
|
|
|
|
|
ACTIVITY RATIO |
|
|
|
|
FIXED ASSETS TURNOVER |
TIMES |
53.95 |
587.14 |
|
TOTAL ASSETS TURNOVER |
TIMES |
1.21 |
1.04 |
|
INVENTORY CONVERSION PERIOD |
DAYS |
132.08 |
14.69 |
|
INVENTORY TURNOVER |
TIMES |
2.76 |
24.84 |
|
RECEIVABLES CONVERSION PERIOD |
DAYS |
170.35 |
212.44 |
|
RECEIVABLES TURNOVER |
TIMES |
2.14 |
1.72 |
|
PAYABLES CONVERSION PERIOD |
DAYS |
282.29 |
223.68 |
|
CASH CONVERSION CYCLE |
DAYS |
20.14 |
3.45 |
|
|
|
|
|
|
PROFITABILITY RATIO |
|
|
|
|
COST OF GOODS SOLD |
% |
88.93 |
92.43 |
|
SELLING & ADMINISTRATION |
% |
8.98 |
5.81 |
|
INTEREST |
% |
0.00 |
0.01 |
|
GROSS PROFIT MARGIN |
% |
11.11 |
7.69 |
|
NET PROFIT MARGIN BEFORE EX. ITEM |
% |
2.13 |
1.88 |
|
NET PROFIT MARGIN |
% |
1.87 |
1.79 |
|
RETURN ON EQUITY |
% |
14.39 |
4.60 |
|
RETURN ON ASSET |
% |
2.26 |
1.87 |
|
EARNING PER SHARE |
BAHT |
17.61 |
4.83 |
|
|
|
|
|
|
LEVERAGE RATIO |
|
|
|
|
DEBT RATIO |
TIMES |
0.84 |
0.59 |
|
DEBT TO EQUITY RATIO |
TIMES |
5.36 |
1.46 |
|
TIME INTEREST EARNED |
TIMES |
764.86 |
171.35 |
|
|
|
|
|
|
ANNUAL GROWTH |
|
|
|
|
SALES GROWTH |
% |
250.30 |
|
|
OPERATING PROFIT |
% |
297.92 |
|
|
NET PROFIT |
% |
264.89 |
|
|
FIXED ASSETS |
% |
3,712.16 |
|
|
TOTAL ASSETS |
% |
201.67 |
|
PROFITABILITY RATIO
|
Gross Profit Margin |
11.11 |
Impressive |
Industrial Average |
9.66 |
|
Net Profit Margin |
1.87 |
Impressive |
Industrial Average |
(0.20) |
|
Return on Assets |
2.26 |
Impressive |
Industrial Average |
(0.27) |
|
Return on Equity |
14.39 |
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 11.11%. 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 1.87% 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 2.26%, 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 14.39%, 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 |
1.14 |
Acceptable |
Industrial Average |
1.72 |
|
Quick Ratio |
0.68 |
|
|
|
|
Cash Conversion Cycle |
20.14 |
|
|
|
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 1.14 times in 2011, decreased from 1.68 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 0.68 times in 2011,
decreased from 1.59 times, then the company has not enough current assets that
presumably can be quickly converted to cash for pay financial obligations.
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 21 days.
Trend of the average competitors in the same industry for last 5 years
Current Ratio Downtrend
LEVERAGE RATIO
|
Debt Ratio |
0.84 |
Acceptable |
Industrial Average |
0.60 |
|
Debt to Equity Ratio |
5.36 |
Risky |
Industrial Average |
1.67 |
|
Times Interest Earned |
764.86 |
Impressive |
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.
Times Interest Earned measuring a company's ability to meet its debt
obligations. Ratio is 764.87 higher than 1, so the company can pay interest
expenses on outstanding debt.
Debt Ratio shows the proportion of a company's assets which are financed
through debt. The company's figure is 0.84 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 |
53.95 |
Impressive |
Industrial Average |
10.73 |
|
Total Assets Turnover |
1.21 |
Satisfactory |
Industrial Average |
1.47 |
|
Inventory Conversion Period |
132.08 |
|
|
|
|
Inventory Turnover |
2.76 |
Impressive |
Industrial Average |
2.17 |
|
Receivables Conversion Period |
170.35 |
|
|
|
|
Receivables Turnover |
2.14 |
Acceptable |
Industrial Average |
3.31 |
|
Payables Conversion Period |
282.29 |
|
|
|
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 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.55.26 |
|
|
1 |
Rs.88.85 |
|
Euro |
1 |
Rs.71.13 |
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%)
This report is issued at your request without any
risk and responsibility on the part of MIRA INFORM PRIVATE LIMITED (MIPL)
or its officials.