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Report Date : |
15.05.2014 |
IDENTIFICATION DETAILS
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Name : |
SAMIR GEMS ISRAEL 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 : |
27.06.2000 |
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Legal Form : |
Private Limited Company |
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Line of Business : |
Traders, importers, exporters and marketers of all types of diamonds. |
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No. of Employees : |
1 |
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 : |
Unknown |
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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) |
|
Israel |
A2 |
A2 |
|
Risk Category |
ECGC
Classification |
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Insignificant |
A1 |
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Low Risk |
A2 |
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Moderately Low Risk |
B1 |
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Moderate Risk |
B2 |
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Moderately High Risk |
C1 |
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High Risk |
C2 |
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Very High Risk |
D |
ISRAEL - ECONOMIC OVERVIEW
Israel has a technologically advanced market economy. Cut
diamonds, high-technology equipment, and pharmaceuticals are among the leading exports.
Its major imports include crude oil, grains, raw materials, and military
equipment. Israel usually posts sizable trade deficits, which are covered by
tourism and other service exports, as well as significant foreign investment
inflows. Between 2004 and 2011, growth averaged nearly 5% per year, led by
exports. 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. 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. The economy has recovered better than most
advanced, comparably sized economies, but slowing demand domestically and
internationally, and a strong shekel, have reduced forecasts for the next
decade to the 3% level. Natural gas fields discovered off Israel's coast since
2009 have brightened Israel's energy security outlook. The Tamar and Leviathan
fields were some of the world's largest offshore natural gas finds this past
decade. The massive Leviathan field is not due to come online until 2018, but
production from Tamar provided a one percentage point boost to Israel's GDP in
2013 and is expected to contribute 0.5% growth in 2014. In mid-2011, public
protests arose around income inequality and rising housing and commodity
prices. Israel's income inequality and poverty rates are among the highest of
OECD countries and there is a broad perception among the public that a small
number of "tycoons" have a cartel-like grip over the major parts of
the economy. 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. In May 2013 the Israeli government, in a politically
difficult process, passed an austerity budget to reign in the deficit and
restore confidence in the government's fiscal position. Over the long term,
Israel faces structural issues, including low labor participation rates for its
fastest growing social segments - the ultra-orthodox and Arab-Israeli
communities. Also, Israel's progressive, globally competitive, knowledge-based
technology sector employs only 9% of the workforce, with the rest employed in
manufacturing and services - sectors which face downward wage pressures from
global competition.
|
Source
: CIA |
SAMIR GEMS ISRAEL LTD.
Telephone 972 3 612 91 21
Fax 972 3 612 91 31
21 Tuval Street
Diamond Exchange, Yahalom Bldg.
RAMAT GAN 5252236 ISRAEL
A private limited company, incorporated as per file No. 51-297346-2 on
the 27.06.2000.
Originally registered under the name ACE DIAMONDS LTD., which changed to
the present name on the 21.11.2013
Authorized share capital of NIS 39,000.00, divided into:
39,000 ordinary shares
of NIS 1.00 each,
of which 100 shares amounting to NIS 100.00 were issued.
Subject is fully owned by Bhavesh Shah.
Based on the Registrar of Companies, until 2011/12 Mr. Dwang Bensli used
to be the controlling shareholder in subject, holding 85%, while Mr. Shah held
15%. At some stage during the last couple of years Mr. Shah gained full
ownership of subject.
Bhavesh Shah
Traders, importers, exporters and marketers of all types of diamonds.
Subject is part of a Group of companies, SAMIR GEMS Group, which is
family owned.
Operating from office premises, owned by SAMIR GEMS Group, in 21 Tuval
Street (also referred to as 54 Bezalel Street), Diamond Exchange, Yahalom
Building, Ramat Gan. SAMIR GEMS Group has branches in India, Belgium and
possibly other places, branches which also serve subject.
Subject's shareholder/manager is the sole employee.
Financial data not forthcoming.
There are 3 charges for unlimited amounts registered on the company's
assets, in favor of Mizrahi Tefahot Bank Ltd. and The State Bank of India.
Charges were placed in years 2003 and 2010.
Sales figures not forthcoming.
Based on our searches, also part of SAMIR GEMS Group:
SAMIR GEMS NV., Belgium
SAMIR GEMS HK LIMITED, Hong
Kong
Mizrahi Tefahot Bank Ltd., Diamond Business Center Branch (No. 466),
Ramat Gan.
The State Bank of India (SBI), Main Branch (No. 001), Ramat Gan.
Nothing unfavorable learned.
Subject’s General Manager, Mr. Bhavesh Shah, refused to disclose
financial data, as well as several other business data, such as to elaborate on
SAMIR GEMS Group. He said he will consult and may provide us more details
later. In case he does, we shall update you accordingly.
Subject is known to be enjoying good reputation in the diamond branch.
Export of polished diamonds from Israel fell by 23% in 2012 from 2011,
after the sector recovered in 2010 and mainly in 2011 from one of the worst
depressions in the global diamond sector due to the economic crisis in global
markets that erupted in 2008. The sector experienced almost an entire freeze
and collapse in sales of about 70% in the peak of the crisis. While the global
diamond industry experienced major declines during 2012, Israel saw a steady
improvement in its diamond trade in the third and fourth quarters of the year,
according to the Diamond Administration at the Ministry of Industry &
Trade.
Israel’s net polished diamond exports stood at US$5.6 billion in 2012,
compared a decline of 23% from 2011. Net rough diamond exports totaled US$2.8
billion in
Net imports of polished diamonds dropped 25% from 2011, totaling US$4.27
billion, while net rough imports stood at US$3.8 billion, 13 % less than in
2011.
The diamond sector marked an improvement in almost all parameters in the
first 9 months of 2013. Net export of polished diamond increased by 8.7%
comparing to the parallel period in 2012, reaching US$ 4.7 billion, while
export of rough diamonds marked 8.5% rise to US$ 2.2 billion. Net import of
rough diamonds reached US$ 2.9 billion, an increase of 9.4%, whereas net import
of polished diamonds fell slightly by 1.1% to US$ 3.06 billion.
The United States continued to be Israel’s major market for polished
diamonds, accounting for 35% of the market in the first 9 months of 2013 (36%
in 2012). Hong Kong is the next largest market with 28% of exports, with
Switzerland accounting for 9.6%, and Belgium 7.6%.
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 crisis. The Ministry for Industry & Trade also
assisted the local diamond exporters by providing bank guarantees in total
scope of NIS 1 billion.
Local diamond sector employs some 20,000 persons.
In February 2009, Israel was ranked as the world’s largest exporter of
cut diamonds, followed by India, Belgium and South Africa.
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.
Notwithstanding the refusal to disclose financial details, considered
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
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Indian Rupees |
|
US Dollar |
1 |
Rs.59.88 |
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|
1 |
Rs.100.98 |
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Euro |
1 |
Rs.82.40 |
INFORMATION DETAILS
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Analysis Done by
: |
DIV |
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Report Prepared
by : |
NNA |
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.