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Report Date : |
16.08.2013 |
IDENTIFICATION DETAILS
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Name : |
NIRU DIAM |
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Formerly Known As : |
NIRU DIAM |
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Registered Office : |
1 Jabotinsky Street Diamond Exchange, Maccabi Bldg. Ramat Gan 5252001 |
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Country : |
Israel |
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Date of Incorporation : |
10.07.1987 |
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Legal Form : |
Private Limited Company |
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Line of Business : |
Manufacturers, processors, cutters, exporters and marketers of diamonds, dealing with rough and polished |
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No. of Employees : |
39 |
RATING & COMMENTS
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MIRA’s Rating : |
Ba |
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RATING |
STATUS |
PROPOSED CREDIT LINE |
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41-55 |
Ba |
Overall operation is considered normal. Capable to meet normal
commitments. |
Satisfactory |
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Status : |
Satisfactory |
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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 – March 31st, 2013
|
Country Name |
Previous Rating (31.12.2012) |
Current Rating (31.03.2013) |
|
Israel |
A2 |
A2 |
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Risk Category |
ECGC
Classification |
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Insignificant |
A1 |
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Low |
A2 |
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Moderate |
B1 |
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High |
B2 |
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Very High |
C1 |
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Restricted |
C2 |
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Off-credit |
D |
ISRAEL - ECONOMIC OVERVIEW
Israel has a technologically advanced market economy. Its
major imports include crude oil, grains, raw materials, and military equipment.
Cut diamonds, high-technology equipment, and pharmaceuticals are among the
leading exports. Israel usually posts sizable trade deficits, which are covered
by tourism and other service exports, as well as significant foreign investment
inflows. The global financial crisis of 2008-09 spurred a brief recession in
Israel, but the country entered the crisis with solid fundamentals - following
years of prudent fiscal policy and a resilient banking sector. The economy has
recovered better than most advanced, comparably sized economies. In 2010,
Israel formally acceded to the OECD. Israel's economy also has weathered the
Arab Spring because strong trade ties outside the Middle East have insulated
the economy from spillover effects. Natural gasfields discovered off Israel's
coast during the past two years have brightened Israel''s energy security outlook.
The Leviathan field was one of the world''s largest offshore natural gas finds
this past decade, and production from the Tama field is expected to meet all of
Israel''s natural gas demand beginning mid-2013. In mid-2011, public protests
arose around income inequality and rising housing and commodity prices. The
government formed committees to address some of the grievances but has
maintained that it will not engage in deficit spending to satisfy populist
demands.
Source
: CIA
NIRU DIAM
Telephone 972 3 575 23 52
Fax 972
3 575 23 51
1 Jabotinsky
Street
Diamond Exchange,
Maccabi Bldg.
RAMAT GAN
5252001 ISRAEL
A private limited company,
incorporated as per file No. 51-121024-7 on the 10.07.1987, continuing
activities originally founded in 1979.
Originally
registered under the name NIRU DIAM
Authorized share
capital of NIS 2,640.00, divided into:
2,640 ordinary shares of NIS
1.00 each,
fully issued.
Subject is fully owned by NEW CENTURY MARKETING
LTD., a foreign company from Hong Kong, owned by Ranjeet Barmacha.
Ranjeet Barmacha
Manufacturers,
processors, cutters, exporters and marketers of diamonds, dealing with rough
and polished diamonds. Subject specializes in long and square diamonds.
Most (some 70% in
2010) sales are for export.
Manufacturing
activities are carried out via sub-contractors (also in China and Sri-Lanka).
Operating from
premises, owned by the shareholders, on an area of 200 sq. meters, in 1
Jabotinsky Street, Diamond Exchange, Maccabi Building (22nd floor),
Ramat Gan. Premises serve also subsidiary BARCODIAM.
Also operating
from affiliated companies premises in New York, Hong Kong, Switzerland, Bangkok
and Dubai, as well as other branches in other countries.
Having 39
employees (had 38 employees in mid 2012, similar to previous years).
Financial data not
forthcoming, known to be of solid financial standing.
There are 6
charges for unlimited amounts registered on the company's assets, in favor of
Bank Leumi Le’Israel Ltd., Mizrahi Tefahot Bank Ltd. and SBI State Bank of
India (last 2 charges placed February-March 2009).
Sales for export of polished diamonds:
2006 sales were
US$ 43,000,000.
2007 sales were
US$ 65,000,000.
2008 sales were
US$ 91,000,000.
2009 sales were
US$ 57,000,000.
2010 sales were
US$ 68,000,000.
Sales for export
comprised some 70% of overall sales in 2010, which means that total sales were
estimated at over to US$ 95,000,000.
2011 sales were
US$ 111,000,000. Overall sales in 2011 estimated at circa
US$ 150,000,000.
2012 sales were
US$ 120,000,000.
BARCODIAM LTD.,
79%, established in 1998, importers, exporters and marketers of diamonds.
Sister companies:
NIRU DIAM
NIRU DIAM
NIRU DIAM
NIRU DIAM
S.E.V. SMALL ELECTRIC VEHICLE LTD., 50%
owned by Ranjeet Barmacha, importers and marketers of electrical bicycles.
Mizrahi Tefahot Bank Ltd., Diamond Business Center Branch (No. 466),
Ramat Gan – main account.
SBI State Bank of India, Diamond Exchange Branch (No. 001), Ramat Gan.
Nothing
unfavorable learned.
Despite our efforts, we were unable to speak with subject's officials,
as they were always unavailable. We left messages which so far remain
unanswered.
Subject is a
veteran business, well-known in the branch.
According to the
reports published by the Israel Supervisor on Diamonds in the Ministry of
Industry and Trade, subject ranked 5th in 2012 lists of Israel's
largest polished diamonds exporters, 6th in 2011, 10th in
2010, 9th in 2008 and in 2009, after being ranked 16th
place in the 2007, 19th in 2006 and 30th in
Export of polished
diamonds from Israel fell by 23% in 2012 from 2011, after the sector recovered
in 2010 and mainly in 2011 from one of the worst depressions in the global
diamond sector due to the economic crisis in global markets that erupted in
2008. The sector experienced almost an entire freeze and collapse in sales of
about 70% in the peak of the crisis. While the global diamond industry
experienced major declines during 2012, Israel saw a steady improvement in its
diamond trade in the third and fourth quarters of the year, according to the
Diamond Administration at the Ministry of Industry & Trade.
Israel’s net
polished diamond exports stood at US$5.6 billion in 2012, compared a decline of
23% from 2011. Net rough diamond exports totaled US$2.8 billion in
Net imports of
polished diamonds dropped 25% from 2011, totaling US$4.27 billion, while net
rough imports stood at US$3.8 billion, 13 % less than in 2011.
The diamond sector
has been keeping a steady trend in the first half of 2013.
Net polished
diamond exports in 2013 1st half witnessed a slight decrease (2%)
comparing to 2012 1stH, reaching US$ 3.233 billion, while export of rough
diamonds saw a 8.1% rise. Net imports of rough diamonds in the 1st
half of 2013 reached US$ 2.037 billion, 2.8% increase compared with the
parallel period in 2012, whereas import of polished diamonds fell by 5.3% to
US$ 2.084 billion.
Expectations in
the local diamond sector for 2013 2nd half is for further recovery.
The United States
continued to be Israel’s major market for polished diamonds, accounting for 44%
of the market in 2013 1st half (36% in 2012). Hong Kong is the next
largest market with 29.7% of exports (28% in 2012), with Switzerland accounting
for 7.8%, Belgium 6.7%, and Thailand with 1.1%.
According to the
President of the Israeli Diamonds Association, in 2010 the trade in the local
diamond sector rolled 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 20,000 persons.
In February 2009,
Israel was ranked as the world’s largest exporter of cut diamonds, followed by
India, Belgium and South Africa.
An affair of an
underground bank shocked the local diamond branch, after in late January 2012
Police raided the Diamond Exchange (after a long undercover operation),
arrested several individuals for investigation, caught diamonds and various
assets worth NIS millions, and blocked several bank accounts. It is suspected
that a group of people, including diamond dealers, run an illegal bank in the
Diamond Exchange compound for loans, money transfer abroad based on fictitious
transactions and exchange in volume of NIS 1 billion for several years.
The affair has
already led to several of reported bankruptcies of local diamond firms, a
decrease of up to 70% in transactions in 2012, frozen bank accounts, and for a
while to paralysis (especially in purchase of raw diamonds) due to uncertainty
among local and foreign dealers.
In March 2012 the
Police decided to lower the profile of the investigation for a while a result
of the big pressure from the diamond branch (to stop the continuing damage
inflicted) and the Government (who is losing US$ hundred millions from decrease
in tax collection). In November 2012 the Police and Tax Authorities recommended
on indictments against the 25 suspects in the affair, among them diamond
dealers, for the said suspicions and obstruction of the investigation.
In June 2013 it was
reported that the Police resumed its raids on the diamonds branch, and although
names of suspects were not released, sources say that it is also related to the
above underground bank affair. In parallel, it is also reported that the Tax
Authorities and diamonds dealers' representatives are trying to reach an
arrangement for past debts.
Good for trade
engagements.
Note: Since February 2013 Israel Post has
started using a new area code method of 7 digits (the old method of 5 digits is
no longer valid).
DIAMOND INDUSTRY – INDIA
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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.
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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.
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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.
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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.
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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.
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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.
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Excerpts from Times of India dated 30th October 2010 is as under
–
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Gem & Jewellery Export Promotion Council in its statistical data has
shown the export of polished diamonds to have increase by 28 % in February
2013. Compared to $ 1.4 bn worth of polished diamond export in February, 2012,
India exported $ 1.84 billion worth of polished diamonds in February 2013. A
senior executive of GJEPC said, “Export of cut and polished diamonds started
falling month-wise after the imposition of 2 % of import duty on the polished
diamonds. But February, 2013 has given a new ray of hope to the industry as the
export of polished diamonds has actually increased by 28 %. It means the
industry is on the track of recovery and round tripping of diamonds has
stopped completely.” Demand has started coming from the US, the UK, Japan and China.
India’s polished diamond export is expected to cross $ 21 bn in 2013-14.
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The banking sector has started exercising restraint while following
prudent risk management norms when lending money to gems and jewellery sector. This
follows the implementation of Basel III accord – a global voluntary regulatory
standard on bank capital adequacy, stress testing and market liquidity.
FOREIGN EXCHANGE RATES
|
Currency |
Unit
|
Indian Rupees |
|
US Dollar |
1 |
Rs.61.51 |
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|
1 |
Rs.94.98 |
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Euro |
1 |
Rs.81.62 |
INFORMATION DETAILS
|
Report
Prepared by : |
PRL |
RATING EXPLANATIONS
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RATING |
STATUS |
PROPOSED CREDIT LINE |
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>86 |
Aaa |
Possesses an extremely sound financial base with the strongest capability
for timely payment of interest and principal sums |
Unlimited |
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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 |
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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 |
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41-55 |
Ba |
Overall operation is considered normal. Capable to meet normal
commitments. |
Satisfactory |
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26-40 |
B |
Capability to overcome financial difficulties seems comparatively
below average. |
Small |
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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 |
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<10 |
C |
Absolute credit risk exists. Caution needed to be exercised |
Credit not
recommended |
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NB |
New Business |
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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.