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Report Date : |
25.02.2014 |
IDENTIFICATION DETAILS
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Name : |
SHLOMO BICHACHI DIAMONDS LTD. |
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Registered Office : |
21 Tuval Street,
Diamond Exchange, Yahalom Bldg., RAMAT GAN 5252236 |
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Country : |
Israel |
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Date of Incorporation : |
26.08.2002 |
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Com. Reg. No.: |
51-329000-7 |
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Legal Form : |
Private Limited Liability Company |
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Line of Business : |
Importers,
manufacturers, polishers, exporters and marketers of wide range of diamonds,
specializing in small fancy cut diamonds. |
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No of Employees : |
80-90 |
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 – december 01, 2013
|
Country Name |
Previous Rating (30.09.2013) |
Current Rating (01.12.2013) |
|
Israel |
A2 |
A2 |
|
Risk Category |
ECGC
Classification |
|
Insignificant |
A1 |
|
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 |
SHLOMO BICHACHI
DIAM
(Also known as
BICHACHI DIAMONDS, or SB DIAMONDS)
Telephone 972 3 613 36 20 /1
Fax 972 3 613 13 42
Email: info@bichachi.com
21 Tuval Street
Diamond Exchange,
Yahalom Bldg.
RAMAT GAN 5252236 ISRAEL
A private limited liability company, incorporated as per file No.
51-329000-7 on the 26.08.2002, continuing a business founded in 1993.
Authorized share capital NIS 39,100.00, divided into - 39,100 ordinary
shares of NIS 1.00 each, of which 100 shares amounting to NIS 100.00 were
issued.
Subject is fully
owned by Shlomo Bichachi.
Shlomo Bichachi
Importers, manufacturers, polishers, exporters and marketers of wide
range of diamonds, specializing in small fancy cut diamonds.
Exports are to
large jewelry businesses and chains in the USA, Hong Kong, etc.
80% of sales are
export.
Operating from
rented office premises, on an area of 200 sq. meters, in 21 Tuval Street (also
known as 54 Bezalel Street), Diamond Exchange, 30th floor (moved
from the 17th Floor), Yahalom Bldg., Ramat Gan, and from 6
branches worldwide: Mumbai, Hong Kong, Los Angeles, New York, Antwerp and
Milan.
Also was known to
be operating from 3 plants in Israel: Netanya, Tel Aviv and Petach Tikva, as
well as from subsidiary a plant in Thailand.
Having 80-90
employees (similar to 2013).
According to a report
from March 2011 there were some 200 employees in the plant in Taiwan.
Financial data not forthcoming, however said
to be of high volumes.
There are 2 charges for unlimited amounts registered on the company's
assets, in favor of Mizrahi Tefahot Bank Ltd. (last charge placed December
2012, prior charge placed January 2003).
2007 sales claimed
to be US$ 35,000,000, of which US$ 28,000,000 were for export.
2008 sales claimed
to be circa US$ 35,000,000, of which US$ 28,000,000 for export.
2009, 2010 sales
not forthcoming.
2011sales claimed
to be US$ 40,000,000, of which 60%-70% for export.
2012 sales claimed
to be US$ 40,000,000, of which 60%-70% for export.
2013 sales claimed
to be US$ 50,000,000, of which 80% for export.
According to the report published by the
Israel Supervisor on Diamonds in the Ministry of Industry and Trade, in 2010
subject exported (polished diamonds) in volume of US$ 27,000,000 (actual
overall sales presumed to be higher, as there are local sales of polished diamonds
and may have sales of rough diamonds as well), 2011 export not forthcoming, in
2012 and in 2013 subject exported (polished diamonds) in volume of US$
40,000,000.
SHLOMO BICHACHI DIAMONDS ASIA LTD., Hong
Kong,
SHLOMO BICHACHI DIAMONDS CORP., L.A., USA,
S. BICHACHI BLUMENFELD DIAMONDS CORP., N.Y.,
USA,
BICHACHI DIAMONDS B.V.B.A, Belgium,
OCTAGON DIAMONDS CO.,LTD., a subsidiary in
Thailand, diamond dealers, manufacturers, polishers and marketers.
Mizrahi Tefahot Bank Ltd., Diamond Exchange Business Center Branch (No.
466), Ramat Gan.
Nothing
unfavorable learned.
Shlomo Bichachi is
veteran in the diamond business and enjoys good reputation in the branch.
According to the
report published by the Israel Supervisor on Diamonds in the Ministry of
Industry and Trade, subject was ranked 18th in the 2013 list of
Israel's largest polished diamonds exporters, same ranking as in 2012 List.
Subject was ranked 25th in the 2010 but did not appear in 2011 list,
which could be either that it ranked lower than 25, or alternatively is that
subject chose not to be included in the list (which is its right).
Israel's diamond
industry remarked on impressive growth in almost all trade parameters in 2013,
from the data by Israel's Diamond Administration at the Ministry of Economics:
Net export of polished diamonds rose by 11.6% from 2012, reaching US$ 6.2
billion. The market has been volatile in recent years: the branch –in Israel as
well as globally- experienced its worst depression in the 2nd half
of 2008 and 2009 due to the global economic crisis (almost an entire freeze and
collapse in sales of about 70% in the peak of the crisis), then recovered in
2010 and mainly in and fell again in 2012 (net export fell by 23% in 2012 from
2011).
Net rough diamond
exports totaled US$2.9 billion in 2013, a mere rise from 2012.
Net imports of
polished diamonds remained in similar level as 2012 (after drop by 25% in 2012
from 2011), totaling US$4.3 billion, while net rough diamonds imports summed at
US$ 4 billion, 4% up from 2012 (when it fell 13% from 2011).
The United States
continued to be Israel’s major market for polished diamonds, accounting for 37%
of the market in 2013 (35% in 2013). Hong Kong is the next largest market with
27% of exports, with Switzerland accounting for 9.3%, Belgium 7.3%, and India
accounting for 2.3% of Israel's polished diamond export.
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
global crisis. The Ministry of Economics also assisted the local diamond exporters
by providing bank guarantees in total scope of NIS 1 billion.
In February 2009,
Israel was ranked as the world’s largest exporter of cut diamonds, followed by
India, Belgium and South Africa.
Local diamond sector employs some 20,000 persons.
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. The Attorney General is in process of
preparing indictments.
In the end of
December 2013 it was reported that 5 diamond dealers were summoned to a hearing
(not mandatory) regarding the a/m affair, prior to filing an indictment, before
the Tel Aviv District Attorney (Tax and Finance sector).
Good for trade engagements.
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. 62.11 |
|
|
1 |
Rs. 103.38 |
|
Euro |
1 |
Rs. 85.32 |
INFORMATION DETAILS
|
Report Prepared
by : |
DPT |
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 |
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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 |
|
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 |
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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 |
|
<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.