MIRA
INFORM REPORT
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Report Date : |
06.05.2014 |
IDENTIFICATION DETAILS
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Name : |
SHENZHEN DAFAN JEWELLERY CO., LTD. |
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Registered Office : |
No. 42 North Cuizhu Road, Luohu District Shenzhen, Guangdong Province 518020 PR |
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Country : |
China |
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Financials (as on) : |
30.06.2013 |
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Date of Incorporation : |
27.08.2002 |
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Com. Reg. No.: |
440301104107941 |
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Legal Form : |
Limited Liabilities Company |
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Line of Business : |
Subject
includes designing and selling Jewelery, handicrafts; domestic trade;
manufacturing jewelery |
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No. of Employees |
211 |
RATING & COMMENTS
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MIRA’s Rating : |
B |
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RATING |
STATUS |
PROPOSED CREDIT LINE |
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26-40 |
B |
Capability to overcome financial difficulties seems comparatively
below average. |
Small |
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Status : |
Moderate |
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Payment Behaviour : |
Slow but 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 – March 31, 2014
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Country Name |
Previous Rating (31.12.2013) |
Current Rating (31.03.2014) |
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China |
A2 |
A2 |
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Risk Category |
ECGC
Classification |
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Insignificant |
A1 |
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Low Risk |
A2 |
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Moderate Low Risk |
B1 |
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Moderate Risk |
B2 |
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Moderate High Risk |
C1 |
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High Risk |
C2 |
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Very High Risk |
D |
CHINA ECONOMIC OVERVIEW
Since the late 1970s China has moved from a closed, centrally planned system to a more market-oriented one that plays a major global role - in 2010 China became the world's largest exporter. Reforms began with the phasing out of collectivized agriculture, and expanded to include the gradual liberalization of prices, fiscal decentralization, increased autonomy for state enterprises, growth of the private sector, development of stock markets and a modern banking system, and opening to foreign trade and investment. China has implemented reforms in a gradualist fashion. In recent years, China has renewed its support for state-owned enterprises in sectors considered important to "economic security," explicitly looking to foster globally competitive industries. After keeping its currency tightly linked to the US dollar for years, in July 2005 China moved to an exchange rate system that references a basket of currencies. From mid 2005 to late 2008 cumulative appreciation of the renminbi against the US dollar was more than 20%, but the exchange rate remained virtually pegged to the dollar from the onset of the global financial crisis until June 2010, when Beijing allowed resumption of a gradual appreciation and expanded the daily trading band within which the RMB is permitted to fluctuate. The restructuring of the economy and resulting efficiency gains have contributed to a more than tenfold increase in GDP since 1978. Measured on a purchasing power parity (PPP) basis that adjusts for price differences, China in 2013 stood as the second-largest economy in the world after the US, having surpassed Japan in 2001. The dollar values of China's agricultural and industrial output each exceed those of the US; China is second to the US in the value of services it produces. Still, per capita income is below the world average. The Chinese government faces numerous economic challenges, including: (a) reducing its high domestic savings rate and correspondingly low domestic consumption; (b) facilitating higher-wage job opportunities for the aspiring middle class, including rural migrants and increasing numbers of college graduates; (c) reducing corruption and other economic crimes; and (d) containing environmental damage and social strife related to the economy's rapid transformation. Economic development has progressed further in coastal provinces than in the interior, and by 2011 more than 250 million migrant workers and their dependents had relocated to urban areas to find work. One consequence of population control policy is that China is now one of the most rapidly aging countries in the world. Deterioration in the environment - notably air pollution, soil erosion, and the steady fall of the water table, especially in the North - is another long-term problem. China continues to lose arable land because of erosion and economic development. The Chinese government is seeking to add energy production capacity from sources other than coal and oil, focusing on nuclear and alternative energy development. Several factors are converging to slow China's growth, including debt overhang from its credit-fueled stimulus program, industrial overcapacity, inefficient allocation of capital by state-owned banks, and the slow recovery of China's trading partners. The government's 12th Five-Year Plan, adopted in March 2011 and reiterated at the Communist Party's "Third Plenum" meeting in November 2013, emphasizes continued economic reforms and the need to increase domestic consumption in order to make the economy less dependent in the future on fixed investments, exports, and heavy industry. However, China has made only marginal progress toward these rebalancing goals. The new government of President XI Jinping has signaled a greater willingness to undertake reforms that focus on China's long-term economic health, including giving the market a more decisive role in allocating resources
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Source
: CIA |
Company name and address
SHENZHEN DAFAN
JEWELLERY CO., LTD.
NO. 42 NORTH CUIZHU ROAD, LUOHU DISTRICT
SHENZHEN, GUANGDONG PROVINCE 518020 PR CHINA
TEL: 86 (0) 755-82266500/82260271
FAX: 86 (0) 755-82260500
***Note: SC’s name should be the heading one, the given name (TTF International Jewelry Design Center) is the trade name.
EXECUTIVE SUMMARY
DATE OF REGISTRATION : AUGUST 27, 2002
REGISTRATION NO. : 440301104107941
LEGAL FORM : LIMITED LIABILITIES COMPANY
CHIEF EXECUTIVE : WU FENGHUA (LEGAL REPRESENTATIVE)
REGISTERED CAPITAL : CNY 12,000,000
STAFF : 211
BUSINESS CATEGORY : PROCESSING & DESIGNING & TRADING
REVENUE : CNY 51,040,000 (FROM JAN. 1, 2013 TO JUN. 30, 2013)
EQUITIES : CNY 38,420,000 (AS OF JUN. 30, 2013)
WEBSITE : www.ttfhighjewelry.com
E-MAIL : info@ttfhignjewelry.com
PAYMENT : AVERAGE
MARKET CONDITION : average
FINANCIAL CONDITION : FAIRly stable
OPERATIONAL TREND : fairly STEADY
GENERAL REPUTATION : AVERAGE
EXCHANGE RATE : CNY 6.25 = USD 1
Adopted abbreviations
(as follows)
SC - Subject Company (the company inquired by you)
N/A – Not available
CNY – China Yuan Ren Min Bi
OPERATIONAL TREND & GENERAL REPUTATION
This section aims at indicating the relative positions of SC in respect of its operational trend & general reputation
Operational Trend:- General Reputation:-
Upward Excellent
Steady Good
Fairly Steady Fairly Good
Ordinary Average
Fair Fair
Stagnant Detrimental
Downward Not known
Not known Not yet be determined
Not yet be determined
LEGAL STATUS & HISTORY
SC was established as a limited liabilities company of PRC with State Administration of Industry & Commerce (SAIC) under registration No.: 440301104107941 on August 27, 2002.
SC’s Organization Code Certificate No.: 74124812-6
SC’s Tax No.: 440301741248126
SC’s registered capital: cny 12,000,000
SC’s paid-in capital: cny 12,000,000
Registration Change Record:-
|
Date |
Change of Contents |
Before the change |
After the change |
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Legal Representative |
Jia Guofan |
Wu Fenghua |
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Shareholder (s) (% of Shareholding) |
Jia Guofan)50%, Wu Fenghua 50% |
Han Dongmei 50%, Wu Fenghua 50% |
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Registered Capital |
CNY 500,000 |
CNY 3,000,000 |
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Registration No. |
4403012096011 |
440301104107941 |
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Registered Capital |
CNY 3,000,000 |
CNY 12,000,000 |
Current Co search indicates SC’s shareholders & chief executives are as follows:-
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Name of Shareholder (s) |
% of Shareholding |
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Han Dongmei |
50 |
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Wu Fenghua |
50 |
SC’s Chief Executives:-
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Position |
Name |
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Legal Representative, Chairman, and General Manager |
Wu Fenghua |
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Supervisor |
Han Dongmei |
RECENT DEVELOPMENT
No recent development was found during our checks at present.
SHAREHOLDER CHART & BACKGROUND
Name % of Shareholding
Han Dongmei 50
Wu Fenghua 50
MANAGEMENT
Wu Fenghua Legal Representative, Chairman and General Manager
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Gender: M
Qualification: University
Working experience (s):
From 2002 to present, working in SC as legal representative, chairman and general manager
Han Dongmei Supervisor
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Gender: F
Qualification: University
BUSINESS OPERATION
SC’s registered business scope includes designing and selling Jewelery, handicrafts; domestic trade; manufacturing jewelery; international trade
SC is mainly engaged in processing, designing and selling different sorts of jewellery.
SC’s products mainly include: hand craft, coral & onyx jewelry, engagement jewelry, and so on.
SC sources its materials 40% from domestic market, and 60% from overseas market, mainly U.S.A. and Europe. SC sells 70% of its products in domestic market, and 30% to overseas market, mainly Southeast Asian market.
The buying terms of SC include Check, T/T, L/C and Credit of 30-60 days. The payment terms of SC include Check, T/T, L/C and Credit of 30-60 days.
Staff & Office:
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SC is known to have approx. 211 staff at present.
SC rents an area as its operating office & factory of approx. 2,000 sq. meters at the heading address.
RELATED COMPANY
SC is not known to have any subsidiary at present.
PAYMENT
Overall payment appraisal:
( ) Excellent ( ) Good (X) Average ( ) Fair ( ) Poor ( ) Not yet be determined
The appraisal serves as a reference to reveal SC's payments habits and ability to pay. It is based on the 3 weighed factors: Trade payment experience (through current enquiry with SC's suppliers), our delinquent payment and our debt collection record concerning SC.
Trade payment experience: SC did not provide any name of trade/service suppliers and we have no other sources to conduct the enquiry at present.
Delinquent payment record: None in our database.
Debt collection record: No overdue amount owed by SC was placed to us for collection within the last 6 years.
BANKING
Basic Bank:
Shanghai Pudong Development Bank Shenzhen Jingtian Sub-branch
AC#: 79050155260001986
FINANCIALS
Financial Summary
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Unit: CNY’000 |
As of Jun. 30, 2013 |
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Total assets |
223,470 |
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Total liabilities |
185,050 |
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Equities |
38,420 |
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From Jan. 1, 2013 to Jun. 30, 2013 |
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Revenue |
51,040 |
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Profits |
3,200 |
Important Ratios
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As of Jun. 30, 2013 |
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*Liabilities to assets |
0.83 |
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*Net profit margin (%) |
6.27 |
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*Return on total assets (%) |
1.43 |
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*Revenue / Total assets |
0.23 |
FINANCIAL COMMENTS
PROFITABILITY: AVERAGE
The revenue of SC appears average in its line.
SC’s net profit margin is fairly good.
SC’s return on total assets is average.
LIQUIDITY: AVERAGE
SC’s revenue is in an average level, comparing with the size of its total assets.
LEVERAGE: FAIR
The debt ratio of SC is fairly high.
The risk for SC to go bankrupt is above average.
Overall financial condition of the SC: Fairly Stable.
CONCLUSIONS
SC is considered medium-sized in its line with fairly stable financial conditions.
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
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Currency |
Unit
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Indian Rupees |
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US Dollar |
1 |
Rs.60.05 |
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1 |
Rs.101.32 |
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Euro |
1 |
Rs.83.34 |
INFORMATION DETAILS
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Analysis Done by
: |
RAS |
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Report Prepared
by : |
NIS |
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.