MIRA INFORM REPORT

Report Date :

21.08.2014

IDENTIFICATION DETAILS

Name :	OSTIA HOLDINGS LTD.
Registered Office :	c/o Krsna Group Ltd, Suite 1101, 11/F., Supreme House, 2A Hart Avenue, Tsimshatsui, Kowloon
Country :	Hong Kong
Date of Incorporation :	08.04.2010
Com. Reg. No.:	52069583
Legal Form :	Limited Company
Line of Business :	· The subject is a diamond and jewellery importer, exporter and wholesaler. · It is trading in loose, polished and cut diamonds as well as jewellery products.
No of Employees :	No employees in Hong Kong Note: It is to be noted that the company does not have its own operating office in Hong Kong. The company uses the address of its secretariat as its correspondence address only. Subject operates from some other country and does not have a base in Hong Kong. Such companies are registered in Hong Kong just to tax benefit purpose and due to the strict privacy laws prevailing in the country. In such cases, the companies are not required to have any employees in Hong Kong nor do have an office there.

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 :	No Operating Office in Hong Kong
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 – June 01, 2014

Country Name	Previous Rating (31.03.2014)	Current Rating (01.06.2014)
Hong Kong	A1	A1

Risk Category	ECGC Classification
Insignificant	A1
Low Risk	A2
Moderate Low Risk	B1
Moderate Risk	B2
Moderate High Risk	C1
High Risk	C2
Very High Risk	D

HONG KONG - ECONOMIC OVERVIEW

Hong Kong has a free market economy, highly dependent on international trade and finance - the value of goods and services trade, including the sizable share of re-exports, is about four times GDP. Hong Kong has no tariffs on imported goods, and it levies excise duties on only four commodities, whether imported or produced locally: hard alcohol, tobacco, hydrocarbon oil, and methyl alcohol. There are no quotas or dumping laws. Hong Kong's open economy left it exposed to the global economic slowdown that began in 2008. Although increasing integration with China, through trade, tourism, and financial links, helped it to make an initial recovery more quickly than many observers anticipated, its continued reliance on foreign trade and investment leaves it vulnerable to renewed global financial market volatility or a slowdown in the global economy. The Hong Kong government is promoting the Special Administrative Region (SAR) as the site for Chinese renminbi (RMB) internationalization. Hong Kong residents are allowed to establish RMB-denominated savings accounts; RMB-denominated corporate and Chinese government bonds have been issued in Hong Kong; and RMB trade settlement is allowed. The territory far exceeded the RMB conversion quota set by Beijing for trade settlements in 2010 due to the growth of earnings from exports to the mainland. RMB deposits grew to roughly 12% of total system deposits in Hong Kong by the end of 2013. The government is pursuing efforts to introduce additional use of RMB in Hong Kong financial markets and is seeking to expand the RMB quota. The mainland has long been Hong Kong's largest trading partner, accounting for about half of Hong Kong's total trade by value. Hong Kong's natural resources are limited, and food and raw materials must be imported. As a result of China's easing of travel restrictions, the number of mainland tourists to the territory has surged from 4.5 million in 2001 to 34.9 million in 2012, outnumbering visitors from all other countries combined. Hong Kong has also established itself as the premier stock market for Chinese firms seeking to list abroad. In 2012 mainland Chinese companies constituted about 46.6% of the firms listed on the Hong Kong Stock Exchange and accounted for about 57.4% of the Exchange's market capitalization. During the past decade, as Hong Kong's manufacturing industry moved to the mainland, its service industry has grown rapidly. Credit expansion and tight housing supply conditions have caused Hong Kong property prices to rise rapidly; consumer prices increased by more than 4% in 2013. Lower and middle income segments of the population are increasingly unable to afford adequate housing. Hong Kong continues to link its currency closely to the US dollar, maintaining an arrangement established in 1983. In 2013, Hong Kong and China signed new agreements under the Closer Economic Partnership Agreement, adopted in 2003 to forge closer ties between Hong Kong and the mainland. The new measures, effective from January 2014, cover services and trade facilitation, and will improve access to the mainland's service sector for Hong Kong-based companies.

Source : CIA

COMPANY NAME & ADDRESS

OSTIA HOLDINGS LTD.

ADDRESS: c/o Krsna Group Ltd.

Suite 1101, 11/F., Supreme House, 2A Hart Avenue, Tsimshatsui, Kowloon, Hong Kong.

PHONE: 852-2369 8722, 3904 2662

FAX: 852-3740 0159, 3904 2664

MANAGEMENT

Managing Director: Mr. Ratan Kedia

SUMMARY

Registered in Hong Kong on: 8th April, 2010.

(Non-Hong Kong Company)

Organization: Limited Company.

Capital: Authorised: US$50,000.00

Issued & Paid Up: US$10,000.00

Business Category: Diamond & Jewellery Trader.

Employees: Nil.

Main Dealing Banker: The Hongkong & Shanghai Banking Corp. Ltd., Hong Kong.

Banking Relation: Satisfactory.

COMPANY NAME & ADDRESS

OSTIA HOLDINGS LTD.

ADDRESS:

Registered Office:-

P.O. Box 957, Offshore Incorporation Centre, Road Town, Tortola, British Virgin Islands.

Hong Kong Principal Place of Business:-

c/o Krsna Group Ltd.

Suite 1101, 11/F., Supreme House, 2A Hart Avenue, Tsimshatsui, Kowloon, Hong Kong.

BUSINESS REGISTRATION NUMBER

52069583

COMPANY FILE NUMBER

F0017506

MANAGEMENT

Managing Director: Mr. Ratan Kedia

AUTHORISED REPRESENTATIVES IN HONG KONG

(As per registry dated 08-04-2014)

Name	Address
Anshu RUNGTA	Flat D, 26/F., Yee Tsui Court, Tower 16, South Horizons, Ap Lei Chau, Hong Kong.

CAPITAL

Authorised Share Capital: US$50,000.00

Issued & Paid Up Capital: US$10,000.00

DIRECTOR

(As per registry dated 08-04-2014)

Name (Nationality)	Address
Ratan KEDIA	117 Samajdari Marg, Kalimati, 6/25 New Road, Kathmandu, Nepal.

SECRETARY

(As per registry dated 08-04-2014)

Name	Address	Co. No.
AT Accounting & Secretarial Services Ltd.	Suite 909, 9/F., Two Grand Tower, 625 Nathan Road, Mongkok, Kowloon, Hong Kong.	0985965

HISTORY

The subject was incorporated in the British Virgin Islands as a limited company. It has established a principal place of business in Hong Kong and was registered on 8th April, 2010 as an oversea company under Part XI of the Hong Kong Companies Ordinance.

Formerly the subject’s registered address was located at “Suite 1508, 15/F., Empress Plaza, 17-19 Chatham Road South, Tsimshatsui, Kowloon, Hong Kong” where was the old operating address of a commercial service provider Krsna Group Ltd. [Krsna]. Krsna moved to the present address with effect from 23rd June, 2014, so did the subject.

Apart from these, neither material change nor amendment has been ever traced and noted.

OPERATIONS

Activities & Lines: All kinds of jewellery and diamonds, other products.

Employees: Nil.

Commodities Imported: India, etc.

Markets: Nepal, other Asian countries, etc.

Terms/Sales: L/C, Advanced T/T, etc.

Terms/Buying: L/C, D/P, O/A, etc.

FINANCIAL INFORMATION

Authorised Share Capital: US$50,000.00

Issued & Paid Up Capital: US$10,000.00

Profit or Loss: Keeping a balance account in Hong Kong.

Condition: Business is not very active in Hong Kong.

Facilities: Making fairly active use of general banking facilities.

Payment: Met trade commitments as required.

Commercial Morality: Satisfactory.

Banker: The Hongkong & Shanghai Banking Corp. Ltd., Hong Kong.

Standing: Small.

GENERAL

Ostia Holdings Ltd. is a Non-Hong Kong Company registered in April 2010. It was incorporated in the British Virgin Islands.

The director of the subject Mr. Ratan Kedia is a Nepal passport holder.

The subject does not have its own operating office. Its Hong Kong registered office is in a commercial service firm located at “Suite 1101, 11/F., Supreme House, 2A Hart Avenue, Tsimshatsui, Kowloon, Hong Kong” known as “Krsna Group Ltd.” [Krsna] which is handling its correspondences and documents. The phone number of Krsna is 852-2369 8722.

The subject has no employees in Hong Kong.

The representative of the subject Mr. Anshu Rungta is a Hong Kong ID holder who has got the right to reside in Hong Kong permanently. His Hong Kong registered address is at Flat D, 26/F., Yee Tsui Court, Tower 16, South Horizons, Ap Lei Chau, Hong Kong.

The subject is a diamond and jewellery importer, exporter and wholesaler. It is trading in loose, polished and cut diamonds as well as jewellery products. Most of the commodities are imported from India. Prime markets are Hong Kong, Nepal and the other Asian countries. Business is still under development.

Besides acting as a secretarial company, Krsna is also a buying office for its local or foreign customers. It is purchasing the following commodities:

Consumer Electronics, Home Appliances, Electrical Products, Mobile Phones, Textile Products, Accessories, etc.

Krsna also purchases the above-mentioned commodities for the subject if necessary.

It is likely that Mr. Ratan Kedia has had an associated firm in Kathmandu, Nepal.

The subject’s business in Hong Kong is not very active. History in Hong Kong, which is short, is just over four years.

Since the subject does not have its own operating office and has no employees in Hong Kong, consider it good for business engagements on L/C basis.

Note

It is to be noted that the company does not have its own operating office in Hong Kong. The company uses the address of its secretariat as its correspondence address only. Subject operates from some other country and does not have a base in Hong Kong. Such companies are registered in Hong Kong just to tax benefit purpose and due to the strict privacy laws prevailing in the country. In such cases, the companies are not required to have any employees in Hong Kong nor do have an office there.

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 8^th Century B.C.  India, in fact, remained undisputed leader till 18^th 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.

- 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 30^th October 2010 is as under –

- 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.

- 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.60.67
UK Pound	1	Rs.100.81
Euro	1	Rs.80.73

INFORMATION DETAILS

Analysis Done by :	KAR
Report Prepared by :	SMN

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%)

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