MIRA INFORM REPORT

Report Date :

16.07.2014

IDENTIFICATION DETAILS

Name :	AL SALAM JEWELLERY LLC
Registered Office :	Gold Centre Building, 4^th Floor, Suite No. 110, Al Khor Street, Gold Souq, Deira, P O Box 6350, Dubai
Country :	United Arab Emirates
Financials (as on) :	31.12.2013
Date of Incorporation :	18.01.1978
Com. Reg. No.:	42364, Dubai
Legal Form :	Limited Liability Company
Line of Business :	retailer of jewellery, specialising in 18k and 22k Gold Pieces and Diamonds, as well as Bracelets, Necklaces, Lockets, Rings, Watches and clocks.
No of Employees :	08

RATING & COMMENTS

MIRA’s Rating :

Ba

RATING		STATUS	PROPOSED CREDIT LINE
41-55	Ba	Overall operation is considered normal. Capable to meet normal commitments.	Satisfactory

Status :	Satisfactory
Payment Behaviour :	No Complaints
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 31, 2014

Country Name	Previous Rating (31.12.2013)	Current Rating (31.03.2014)
United Arab Emirates	A2	A2

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

United Arab Emirates ECONOMIC OVERVIEW

The UAE has an open economy with a high per capita income and a sizable annual trade surplus. Successful efforts at economic diversification have reduced the portion of GDP based on oil and gas output to 25%. Since the discovery of oil in the UAE more than 30 years ago, the country has undergone a profound transformation from an impoverished region of small desert principalities to a modern state with a high standard of living. The government has increased spending on job creation and infrastructure expansion and is opening up utilities to greater private sector involvement. In April 2004, the UAE signed a Trade and Investment Framework Agreement with Washington and in November 2004 agreed to undertake negotiations toward a Free Trade Agreement with the US; however, those talks have not moved forward. The country's Free Trade Zones - offering 100% foreign ownership and zero taxes - are helping to attract foreign investors. The global financial crisis, tight international credit, and deflated asset prices constricted the economy in 2009. UAE authorities tried to blunt the crisis by increasing spending and boosting liquidity in the banking sector. The crisis hit Dubai hardest, as it was heavily exposed to depressed real estate prices. Dubai lacked sufficient cash to meet its debt obligations, prompting global concern about its solvency. The UAE Central Bank and Abu Dhabi-based banks bought the largest shares. In December 2009 Dubai received an additional $10 billion loan from the emirate of Abu Dhabi. Dependence on oil, a large expatriate workforce, and growing inflation pressures are significant long-term challenges. The UAE's strategic plan for the next few years focuses on diversification and creating more opportunities for nationals through improved education and increased private sector employment.

Source : CIA

SUMMARY

Company Name : AL SALAM JEWELLERY LLC

Country of Origin : Dubai, United Arab Emirates

Legal Form : Limited Liability Company - LLC

Registration Date : 18^th January 1978

Commercial Registration Number : 42364, Dubai

Trade Licence Number : 204157

Chamber Membership Number : 3956

Issued Capital : UAE Dh 3,500,000

Paid up Capital : UAE Dh 3,500,000

Total Workforce : 8

Activities : Retail of jewellery, specialising in 18k and 22k gold pieces and

diamonds.

Financial Condition : Good

Payments : Nothing detrimental uncovered

Operating Trend : Steady

Person Interviewed : Hagob Barbarian, General Manager

COMPANY NAME

AL SALAM JEWELLERY LLC

company ADDRESS

Registered & Physical Address

Building : Gold Centre Building, 4^th Floor, Suite No. 110

Street : Al Khor Street

Area : Gold Souq, Deira

PO Box : 6350

Town : Dubai

Country : United Arab Emirates

Telephone : (971-4) 2266243 / 2232759 / 2232884 / 2255871

Facsimile : (971-4) 2254185 / 2264460

Mobile : (971-50) 6449930 / 4505176

Email : tamara10@emirates.net.ae

Premises

Subject operates from a small suite of offices that are rented and located in the Central Business Area of Dubai.

KEY PRINCIPALS

Name Nationality Position

· Markas Agob Markastian Syrian Managing Director

· Waleed Abdel Malek Mohamed Emirati Director

· Hagob Barbarian - General Manager

· Sachin Narayan - Finance Manager

LEGAL FORM & OWNERS

Date of Establishment : 18^th January 1978

Legal Form : Limited Liability Company - LLC

Commercial Reg. No. : 42364, Dubai

Trade Licence No. : 204157

Chamber Member No. : 3956

Issued Capital : UAE Dh 3,500,000

Paid up Capital : UAE Dh 3,500,000

Name of Shareholder (s) Percentage

· Waleed Abdel Malek Mohamed 51%

· Markas Agob Markastian 49%

AFFILIATED COMPANIES

· Tamara Jewellery LLC

Dubai

OPERATIONS

Activities: Engaged in the retail of jewellery, specialising in 18k and 22k gold pieces and diamonds, as well as

bracelets, necklaces, lockets, rings, watches and clocks.

Import Countries: Italy, India and Hong Kong

Export Countries: Saudi Arabia and Kuwait

Operating Trend: Steady

Subject has a workforce of 8 employees.

FINANCIAL DATA

Financial highlights provided by local sources are given below:

Currency: United States Dollars (US$)

Year Ending 31/12/12: Year Ending 31/12/13:

Total Revenue US$ 65,000,000 US$ 68,500,000

Local sources consider subject’s financial condition to be Good.

The above figures were provided by Mr Hagob Barbarian, General Manager

BANKERS

· Standard Chartered Bank

Khalid Bin Waleed Street

Mankhool Branch

PO Box: 999

Dubai

Tel: (971-4) 2520455

· Habib Bank Ltd

Trade Service Centre

Murshid Bazaar

PO Box: 888

Dubai

Tel: (971-4) 2221281

Fax: (971-4) 2284631

· Mashreq Bank Plc

Deira Branch

PO Box: 1250

Dubai

Tel: (971-4) 2229131 / 2221134

Acc No. 0490102097

PAYMENT HISTORY

No complaints regarding subject’s payments have been reported.

Date of transaction September 2000

Amount overdue 0

Payment terms 180 days

Payment Method Letters of Credit

Paying record No Complaints

Currency US Dollars

GENERAL COMMENTS

Al Salam Jewellery LLC is a well established company with operations dating back to 1978, specialising in the retail of jewellery.

During the course of this investigation nothing detrimental was uncovered regarding subject’s operating history or the manner in which payments are fulfilled. As such the company is considered to be a fair trade risk.

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.60.22
UK Pound	1	Rs.102.79
Euro	1	Rs.81.95

INFORMATION DETAILS

Analysis Done by :	KAR
Report Prepared by :	MNL

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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