MIRA INFORM REPORT

Report Date :

19.11.2014

IDENTIFICATION DETAILS

Name :	MEY - HANACHAL LTD.

Registered Office :	17 Yehuda Hanasi Street Bnei Brak 5159202

Country :	Israel

Date of Incorporation :	11.04.1991

Legal Form :	Private Limited Company

Line of Business :	Agencies, International brokers in the paper, pulp and cardboard fields.

No. of Employees :	1

RATING & COMMENTS

MIRA’s Rating :

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 – June 1, 2014

Country Name

Previous Rating

(31.03.2014)

Current Rating

(01.06.2014)

Israel

Risk Category	ECGC Classification
Insignificant	A1
Low	A2
Moderate	B1
High	B2
Very High	C1
Restricted	C2
Off-credit	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

Company name

MEY - HANACHAL LTD.

Telephone 972 3 676 45 32

Fax 972 3 676 45 30

Email: mhll@a-nahal.com

17 Yehuda Hanasi Street

BNEI BRAK 5159202 ISRAEL

HISTORY & LEGAL FORMATION

A private limited company, incorporated as per file No. 51-156040-1 on the 11.04.1991.

SHARE CAPITAL

Authorized share capital NIS 11,000.00, divided into -

11,000 ordinary shares of NIS 1.00 each,

of which 300 shares amounting to NIS 300.00 were issued.

SHAREHOLDERS

According to the Registrar of Companies:

A.I.G. ERETZ HEFETZ LTD., 50%,

K.M.I.A BS"D LTD., 50%.

We assume that in practice shares are held by:

1. Joseph Gavra, 50%,

2. Itzhak Moshe Klein, 50%.

DIRECTORS & JOINT GENERAL MANAGERS

1. Itzhak Moshe Klein,

2. Joseph Gavra.

BUSINESS

Agencies, international brokers in the paper, pulp and cardboard fields.

All activities are on a commission basis.

Among clients: HOGLA KIMBERLY, SHANIV PAPER INDUSTRY, OFFICE DEPOT, SOLAN PRINT, GLILON INDUSTRIES, KRAVITZ , YEDIOTH AHARONOT, MAARIV, HAARETZ (the latter 3 are newspaper publishers in Israel), etc.

All of subject suppliers are foreign.

Sole local agents of (main ones):

HEINZEL, of Austria,

EKMAN, of Sweden,

KONDOPOGA, of Russia/Germany,

L.L. of UK,

FABRIANO, of Italy.

Operating from owned premises, on an area of 140 sq. meters, in 17 Yehuda Hanasi Street, Bnei Brak (to where they moved from 1 Yehudit Street, Bnei Brak).

Both subject's joint general managers are the sole employees.

MEANS

Subject does not keep stock.

Financial data not forthcoming.

There are no charges registered on the company's assets.

REVENUES

2007 revenues claimed to be US$ 12,000,000 (average commission 1.2%-1.5%).

2008 revenues claimed to be US$ 14,000,000 (average commission 1.2%-1.5%).

2009 revenues claimed to be circa US$ 14,000,000 (average commission 1.2%-1.5%).

2010 revenues data unavailable.

2011 revenues claimed to be US$ 15,000,000 (average commission 1.5%).

2012 revenues claimed to be US$ 15,000,000 (average commission 1.5%).

2013 revenues claimed to be US$ 15,000,000 (average commission 1.5%).

Later revenues figures unavailable.

BANKERS

Bank Hapoalim Ltd., Ramat Gan Branch (No. 613), Ramat Gan, account No. 322926.

A check with the Central Banks’ database did not reveal anything detrimental on subject’s a/m account.

CHARACTER AND REPUTATION

Nothing unfavorable learnt (besides the following case which ended).

There was lawsuit on the sum of NIS 608,000 against subject, Mr. Joseph Gavra and local company SHANIV PAPER INDUSTRIES filed in 2010 by foreign supplier CELLMARK RECYCLING BENELUX BV to the Tel Aviv Magistrate Court. We learn that the supplier claims that SHANIV PAPER did not pay for the goods supplies, claiming it was different from what they ordered. We assume that subject was the supplier's agent, hence it is also sued. Matter ended in compromise, further data not forthcoming.

Subject's General Manager, Mr. Joseph Gavra, the only authorized person to disclose data on subject is presently abroad and due back in two weeks' time. We shall contact him upon his return and update you accordingly.

This is a veteran business

There are 4 large producers/ processors/ suppliers of corrugated board branch, on top of some 30 small local manufacturers and importers from Turkey (around 2% of the market). Local corrugated board market was valued at NIS 1.48 billion in year 2012 - 325,000 tons (NIS 1.45 billion, 325,000 tons in 2011).

According to the Central Bureau of Statistics (CBS), import of raw materials for the Paper industries in 2013 from 2012, reaching total of NIS 2,803.5 million (though in $ terms there was a 1.6% increase to US$ 776 million). This continues the downward trend in 2012 when it fell by 4.8% 6% from 2011, which came after couple of years in which import level rose, by over 20% in 2010 and by several percentages in 2011.

SUMMARY

Notwithstanding the lack of updated data from subject's officials, considered good for trade engagements.

Note: Since February 2013 Israel Post has started using a new area code method of 7 digits (the old method of 5 digits is no longer valid).

FOREIGN EXCHANGE RATES

Currency	Unit	Indian Rupees
US Dollar	1	Rs.61.83
UK Pound	1	Rs.96.56
Euro	1	Rs.77.42

INFORMATION DETAILS

Analysis Done by :	DIV

Report Prepared by :	SHG

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%)

PRIVATE & CONFIDENTIAL : This information is provided to you at your request, you having employed MIPL for such purpose. You will use the information as aid only in determining the propriety of giving credit and generally as an aid to your business and for no other purpose. You will hold the information in strict confidence, and shall not reveal it or make it known to the subject persons, firms or corporations or to any other. MIPL does not warrant the correctness of the information as you hold it free of any liability whatsoever. You will be liable to and indemnify MIPL for any loss, damage or expense, occasioned by your breach or non observance of any one, or more of these conditions

This report is issued at your request without any risk and responsibility on the part of MIRA INFORM PRIVATE LIMITED (MIPL) or its officials.