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Report Date : |
23.03.2013 |
IDENTIFICATION DETAILS
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Name : |
YOSHFE DIAMONDS INTERNATIONAL LTD. |
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Registered Office : |
23 Tuval Street, Diamond Exchange, Noam Bldg., Ramat Gan 5252238 |
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Country : |
Israel |
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Date of Incorporation : |
05.03.2009 |
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Legal Form : |
Private Limited Company |
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Line of Business : |
Processors, polishers, importers and exporters of diamonds, from
diamonds 0.005 to 2ct rounds. |
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No. of Employees : |
Having 60 employees (had 50 employees as of end of 2010, 40 employees in
early 2010, same as in 2009). |
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 : |
Usually Correct |
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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 – June 30th, 2012
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Country Name |
Previous Rating (31.03.2012) |
Current Rating (30.06.2012) |
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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. It depends on imports of crude oil, grains, raw
materials, and military equipment. Cut diamonds, high-technology equipment, and
agricultural products (fruits and vegetables) are 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. 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. 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.
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Source : CIA |
YOSHFE DIAMONDS INTERNATIONAL LTD.
(Also known in
short as YDI)
Telephone 972 73 227 72 00
Fax 972 3 613 46 13;
613 43 70
Email: info@ydiltd.com
23 Tuval Street
Diamond Exchange, Noam Bldg.
RAMAT GAN 5252238 ISRAEL
A private limited company, incorporated as per file No. 51-425023-2 on
the 05.03.2009. Actual activities began in August 2009.
Subject was
established in view of the split of the local activities of YAHALOMEI ESPEKA INTERNATIONAL LTD. (YEI), a private limited company
incorporated in 1982, originally founded in the 1960's.
We are informed
that YEI shareholders decided to brake-up their partnership, therefore one
partner -Itzhak Phillip Zivan-Sussholz formed his own company, while the other
partner - Abraham Fluk, formed subject.
Also as part of
the split, subject assumed most activities of YEI 60% subsidiary LESHEM PRIMA DIAMOND'S
LTD., who ceased activities in mid 2009.
Diamond activities
of the Fluk family, now 3rd generation, were founded in 1946 by The
Late Zorach Fluk (which then co-founded YEI).
Authorized share capital NIS 100,001.00, divided into –
1 management share
(issued),
100,000 ordinary shares
(100 shares issued), all of NIS 1.00 each,
of which shares amounting to NIS 101.00 were issued.
Subject is fully owned by Abraham Fluk.
1. Abraham Fluk, Chairman,
2. Tommy Ori Fluk, CEO.
Processors,
polishers, importers and exporters of diamonds, from diamonds 0.005 to 2ct
rounds.
80% of sales are
for export (in 2010).
Operating from office
premises, owned by Abraham Fluk, on an area of 500 sq. meters, in 23 Tuval
Street (also known as 52 Bezalel Street), Diamond Exchange, Noam Building (Room
No. 501), Ramat Gan.
Having branches in New York, Hong Kong and Antwerp. Group has 3 manufacturing
facilities, including in China.
Having 60 employees (had 50 employees as of end of 2010, 40 employees in
early 2010, same as in 2009).
Financial data not
forthcoming, known to be of a solid financial standing.
Subject (and in the
past YEI LTD.) has been a DTC Sightholder and is a longstanding key purchaser
from all the major rough producers.
There are 5 charges for unlimited amounts
registered on the company's assets, in favor of Bank Leumi Le’Israel Ltd. and
Israel Discount Bank Ltd. (last charge placed on real estate assets in March
2012).
Sales of YEI (who preceded subject):
YEI sales for export in 2006 were US$ 156,000,000
YEI sales for export in 2007 were US$ 194,000,000
YEI sales for export in 2008 were US$ 159,000,000
Subject’s sales begun in August 2009, after
the split.
Sales for export (net) of polished diamonds as published by the Supervisor on Diamonds
in the Israeli Ministry of Industry & Trade (Note: Overall sales
are higher as there are sales to the local market as well):
Sales for export in 2009 were US$ 29,000,000.
Sales for export in 2010 were US$ 91,000,000.
Sales for export in 2011 were US$ 130,000,000.
Sales for export in 2012 were US$ 84,000,000.
2010 overall (local
and export, polished and rough) sales (as informed to us by subject’s Chairman)
were US$ 150,000,000.
YAHALOMEI ESPEKA INTERNATIONAL LTD., equally owned by Abraham Fluk (50%) and
Itzhak Phillip Zivan-Sussholz, presently mainly a holding company. In past were
manufacturers, importers, polishers, exporters and marketers of
diamonds; currently we are informed that only the international activity
remains.
YDI LTD., USA,
YDI (BELGIUM) BVBA,
YDI HK LIMITED, Hong Kong,
LESHEM PRIMA DIAMOND'S
LTD., 60%, ceased activities in mid 2009.
VOEGELI & WIRZ
AG/AS, of Switzerland.
· Bank Leumi Le’Israel Ltd., Diamond Exchange Branch (No. 629), Ramat Gan.
· Israel Discount Bank Ltd., Diamond Exchange Branch (No. 080), Ramat Gan.
Nothing
unfavorable learned.
So far we were
unable to speak with subject's officials, as they were always unavailable.
According to the
Israel Supervisor on Diamonds in the Ministry of Industry & Trade, subject
was ranked 9th in the list of Israel’s largest cut diamond exporters
for 2012, after being ranked 5th in 2011, 6th 2010 and 21st
in 2009.
YAHALOMEI ESPAKA INTERNATIONAL LTD., known in short as YEI, was one of the
largest and leading diamond dealers in the local diamond market. It was a sight
holder since 1971 and operating from manufacturing and processing facilities in
Israel, China and branches worldwide. In 1999 YEI was awarded the
"Excellent Exporter" Award from the Ministry of Industry & Trade.
YEI was ranked as
Israel’s 4th largest cut diamond exporter in 2008, same as in 2007.
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 severe economic crisis in global markets that erupted
in September 2008. 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%.
While the global
diamond industry experienced major declines during the year, Israel saw a
steady improvement in its diamond trade in the third and fourth quarters of the
year, according to Ministry of Industry, Trade and Labor Diamond Controller
Shmuel Mordechai, who published figures for Israel’s diamond imports and
exports during 2012.
Israel’s net
polished diamond exports stood at US$5.6 billion in 2012, compared a decline of
23% from 2011. Mr. Mordechai said that Israel’s diamond trade seems likely to
continue to improve in 2013 and return to levels of 2011, which was a record
year.
Israel’s net rough
diamond exports totaled US$2.8 billion in 2012, a 20% decrease from 2011.
Net imports of
polished diamonds dropped 25% from 2011, totaling US$4.27 billion, while net rough
imports stood at US$3.8 billion, 13 % less than in 2011.
The United States
continued to be Israel’s major market for polished diamonds, accounting for 36%
of the market. Hong Kong was the next largest market with 28% of exports, with
Belgium accounting for 8%, Switzerland 5%, U.K. 5% and the rest of the world
18%.
An affair of an
underground bank has been shocking the local diamond branch, after in late
January 2012 Police raided the Diamond Exchange (after a long undercover
operation), arrested several individuals for investigation, caught diamonds and
various assets worth NIS millions, and blocked several bank accounts. It is
suspected that a group of people, including diamond dealers, run an illegal
bank in the Diamond Exchange compound for loans, money transfer abroad based on
fictitious transactions and exchange in volume of NIS 1 billion for several
years. The affair has already led to several of reported bankruptcies of local
diamond firms, a decrease of up to 70% in transactions in 2012, frozen bank
accounts, a paralysis (especially in purchase of raw diamonds) even with fear
of the a collapse of the sector, while dealers –local and foreign- face
uncertainty.
In March 2012 the
Police decided to lower the profile of the investigation for a while a result
of the big pressure from the diamond branch (to stop the continuing damage
inflicted) and the Government (who is losing US$ 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.
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.
Good for trade engagements and high credits.
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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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.
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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 –
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.
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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
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Currency |
Unit
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Indian Rupees |
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US Dollar |
1 |
Rs.54.28 |
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UK Pound |
1 |
Rs.82.06 |
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Euro |
1 |
Rs.70.23 |
INFORMATION DETAILS
|
Report Prepared
by : |
MNL |
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.