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Report Date : |
27.05.2014 |
IDENTIFICATION DETAILS
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Name : |
GLOBAL DIAMONDS (G.D) 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 : |
26.08.2012 |
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Legal Form : |
Private Limited Company |
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Line of Business : |
Dealers, Importer and Exporters of Diamonds. |
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No. of Employees : |
Not Available |
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 |
|
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 |
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 |
GLOBAL DIAMONDS
(G.D) LTD.
Telephone 972 3 726 20 00
Fax 972 3 726 20
01
21 Tuval Street
Diamond Exchange, Yahalom Bldg.
RAMAT GAN 5252236 ISRAEL
A private limited company, incorporated as per file No. 51-481372-4 on
the 26.08.2012.
Authorized share capital of NIS 40,000.00, divided into:-
40,000 ordinary shares of NIS 1.00 each, of which 100 shares amounting
to NIS 100.00 were issued.
Subject is fully owned by Yosef Shilon.
Yosef (Yossi) Shilon
Ms. Orit Peretz Lefler, born 1971.
Dealers, importers and exporters of diamonds.
Operating from premises, in 21 Tuval Street (street name is also
referred to as 54 Bezalel Street), 26th Floor, Diamond Exchange,
Yahalom Building, Ramat Gan. Offices are shared with a sister company.
Number of employees not forthcoming.
Financial data not forthcoming.
There are 2 charges for unlimited amounts registered on the company's
assets in favor of Mizrahi Tefahot Bank Ltd. (both charges placed October
2012).
Sales figures not forthcoming.
THE WORLD'S LOCAL DIAMONDS LTD., owned by Yosef Shilon, incorporated in
2010, processors, traders, importers and exporters of diamonds.
Mizrahi Tefahot Bank Ltd., Diamond Exchange Business Branch (No. 466), Ramat
Gan.
Nothing unfavorable learned on subject itself.
Subject's General Manager, Ms. Orit Lefler, refused to disclose any
details.
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.
According to the reports 16 suspects were arrested for investigation,
Ms. Orit Lefler (subject's General Manager) being one of them, although she was
released for house detention after 1 day, while the arrest of other suspects
was extended.
The affair 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 a/m affair, prior to filing an
indictment, before the Tel Aviv District Attorney (Tax and Finance sector).
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.
Considering the refusal to disclose information,
dealings are recommended on a fully secure basis.
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.58.59 |
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|
1 |
Rs.98.66 |
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Euro |
1 |
Rs.79.81 |
INFORMATION DETAILS
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Analysis Done by
: |
RAS |
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Report Prepared
by : |
NIT |
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.