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Report Date : |
09.05.2014 |
IDENTIFICATION DETAILS
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Name : |
ROYAL DIAMOND CO
LTD |
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Registered Office : |
Shimada Bldg 3F, 3-34-5 Taito Taitoku
Tokyo 110-0005 |
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Country : |
Japan |
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Financials (as on) : |
31.05.2013 |
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Date of Incorporation : |
March 1998 |
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Com. Reg. No.: |
(Tokyo-Taitoku)
015957 |
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Legal Form : |
Private Limited Company |
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Line of Business : |
Engaged in importing and wholesaling diamonds and diamond
jewelry. |
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No of Employees : |
07 |
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
|
Country Name |
Previous Rating (31.12.2013) |
Current Rating (31.03.2014) |
|
Japan |
A1 |
A1 |
|
Risk Category |
ECGC
Classification |
|
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 |
Japan ECONOMIC OVERVIEW
In the years following World War II, government-industry
cooperation, a strong work ethic, mastery of high technology, and a comparatively
small defense allocation (1% of GDP) helped Japan develop a technologically
advanced economy. Two notable characteristics of the post-war economy were the
close interlocking structures of manufacturers, suppliers, and distributors,
known as keiretsu, and the guarantee of lifetime employment for a substantial
portion of the urban labor force. Both features are now eroding under the dual
pressures of global competition and domestic demographic change. Japan's
industrial sector is heavily dependent on imported raw materials and fuels. A
small agricultural sector is highly subsidized and protected, with crop yields
among the highest in the world. While self-sufficient in rice production, Japan
imports about 60% of its food on a caloric basis. For three decades, overall
real economic growth had been spectacular - a 10% average in the 1960s, a 5%
average in the 1970s, and a 4% average in the 1980s. Growth slowed markedly in
the 1990s, averaging just 1.7%, largely because of the after effects of inefficient
investment and an asset price bubble in the late 1980s that required a
protracted period of time for firms to reduce excess debt, capital, and labor.
Modest economic growth continued after 2000, but the economy has fallen into
recession three times since 2008. A sharp downturn in business investment and
global demand for Japan's exports in late 2008 pushed Japan into recession.
Government stimulus spending helped the economy recover in late 2009 and 2010,
but the economy contracted again in 2011 as the massive 9.0 magnitude
earthquake and the ensuing tsunami in March disrupted manufacturing. The
economy has largely recovered in the two years since the disaster, but
reconstruction in the Tohoku region has been uneven. Prime Minister Shinzo ABE
has declared the economy his government's top priority; he has overturned his
predecessor's plan to permanently close nuclear power plants and is pursuing an
economic revitalization agenda of fiscal stimulus, monetary easing, and
structural reform. Japan joined the Trans Pacific Partnership negotiations in
2013, a pact that would open Japan's economy to increased foreign competition
and create new export opportunities for Japanese businesses. Measured on a
purchasing power parity (PPP) basis that adjusts for price differences, Japan
in 2013 stood as the fourth-largest economy in the world after second-place
China, which surpassed Japan in 2001, and third-place India, which edged out
Japan in 2012. The new government will continue a longstanding debate on
restructuring the economy and reining in Japan's huge government debt, which is
exceeding 230% of GDP. To help raise government revenue and reduce public debt,
Japan decided in 2013 to gradually increase the consumption tax to a total of
10% by the year 2015. Japan is making progress on ending deflation due to a
weaker yen and higher energy costs, but reliance on exports to drive growth and
an aging, shrinking population pose other major long-term challenges for the
economy.
|
Source : CIA |
ROYAL DIAMOND CO LTD
Royal Diamonds YK
Shimada Bldg 3F,
3-34-5 Taito Taitoku Tokyo 110-0005 JAPAN
Tel: 03-3839-6005 Fax: 03-3839-2237
URL: N/A
Import,
wholesale of diamonds, jewelry
Nil
(subcontracted)
BAVESH
SHAH, PRES (Indian resident)
Yen
Amount: In million Yen, unless
otherwise stated
FINANCES FAIR A/SALES Yen 1,876 M
PAYMENTS Slow
But Correct CAPITAL Yen 130 M
TREND UP WORTH Yen 164 M
STARTED 1998 EMPLOYES 7
IMPORTER
AND WHOLESALER SPECIALIZING IN DIAMONDS
FINANCIAL SITUATION CONSIDERED
FAIR AND GOOD FOR ORDINARY BUSINESS ENGAGEMENTS
The subject company was established by Bavesh Shah, an Indian resident, in order to make most of his experience in the subject line of business. This is a trading firm specializing in importing and wholesaling diamonds and diamond jewelry. Goods are imported from India, USA, Hong Kong, Bangkok, other. Clients are jewelry processors, jewelers, other, centering in greater-Tokyo. Diamonds are partially subcontracted mfg to local jewelry processors.
Financials are only partially disclosed.
The sales volume for May/2013 fiscal term amounted to Yen 1,876 million, a 17% up from Yen 1,600 million. Diamond price hikes contributed to the sales growth. The net profit was posted at Yen 7 million, compared with Yen 3 million a year ago. .
For the current term ending May 2014 the net profit is projected at Yen 10 million, on a 4% rise in turnover, to Yen 1,950 million. Business is seen expanding steadily.
The financial situation is considered FAIR and good for ORDINARY business engagements.
Date Registered: Mar
1998
Regd No.: (Tokyo-Taitoku) 015957
Legal Status: Private Limited Company (Yugen Kaisha)
Regd Capital: Yen 130 million
Major shareholders (%):
Bavesh Shah (100)
Nothing
detrimental is known as to his commercial morality.
Activities: Imports and wholesales diamonds & jewelry (--100%)
Clients: [Jewel processors, jewelers] Sanghavi Jewellery Tokyo, Kyocera Corp, other (--80%).
Diamond Jewelry as produced & processed in Japan are exported (20%)
No. of accounts: 300
Domestic areas of activities: Centered in greater-Tokyo
Suppliers: [Mfrs, wholesalers] Imports from Sanghavi Export, India, USA, Hong Kong, Bangkok, other.
Payment record: Slow But Correct
Location: Business area in Tokyo. Office premises at the caption address are leased and maintained satisfactorily.
Bank References:
SMBC (Ueno)
Asahi Shinkin Bank (H/O)
Relations: Satisfactory
(In Million Yen)
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Terms Ending: |
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31/05/2014 |
31/05/2013 |
31/05/2012 |
31/05/2011 |
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Annual
Sales |
|
1,950 |
1,876 |
1,600 |
1,200 |
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Recur.
Profit |
|
.. |
.. |
.. |
.. |
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Net
Profit |
|
10 |
7 |
3 |
1 |
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Total
Assets |
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|
N/A |
N/A |
N/A |
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Net
Worth |
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|
164 |
157 |
154 |
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Capital,
Paid-Up |
|
|
130 |
130 |
130 |
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Div.P.Share(¥) |
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|
0.00 |
0.00 |
0.00 |
|
<Analytical Data> |
(%) |
(%) |
(%) |
(%) |
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|
S.Growth Rate |
3.94 |
17.25 |
33.33 |
20.00 |
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Current Ratio |
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|
.. |
.. |
.. |
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N.Worth Ratio |
|
.. |
.. |
.. |
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N.Profit/Sales |
0.51 |
0.37 |
0.19 |
0.08 |
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Notes: Financials are only
partially disclosed. The figures for the
31/05/2012 fiscal term are altered upon confirmation of the company.
Forecast
(or estimated) figures for the 31/05/2014 fiscal term.
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.59.99 |
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UK Pound |
1 |
Rs.101.75 |
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Euro |
1 |
Rs.83.48 |
INFORMATION DETAILS
|
Analysis Done by
: |
DIV |
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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 |
|
-- |
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.