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Report No. : |
352991 |
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Report Date : |
11.12.2015 |
IDENTIFICATION DETAILS
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Name : |
V. GOLDI 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 : |
15.05.2003 |
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Legal Form : |
Private Limited Company |
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Line of Business : |
Importers,
Marketers and Exporters of Diamonds of all Sorts. |
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No. of Employees : |
Not Available |
RATING & COMMENTS
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MIRA’s Rating : |
Ba |
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RATING |
STATUS |
PROPOSED CREDIT LINE |
|
|
41-55 |
Ba |
Overall operation is considered normal. Capable to meet normal
commitments. |
Satisfactory |
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Status : |
Satisfactory |
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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, 2015
|
Country Name |
Previous Rating (31.12.2014) |
Current Rating (31.03.2015) |
|
Israel |
B1 |
B1 |
|
Risk Category |
ECGC
Classification |
|
Insignificant |
A1 |
|
Low |
A2 |
|
Moderate |
B1 |
|
High |
B2 |
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Very High |
C1 |
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Restricted |
C2 |
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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 2013, 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. Israel's economy
also has weathered the Arab Spring because strong trade ties outside the Middle
East have insulated the economy from spillover effects. Slowing demand
domestically and internationally and reduced investment due to uncertainties
caused by the Gaza conflict in summer 2014 have reduced GDP growth to about 2%
during 2014. 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 expected to come online no sooner than 2017, but
production from Tamar provided a one percentage point boost to Israel's GDP in
2013 and a 0.5% boost 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 and has started splitting up the oligopolies to address some of the
grievances but has maintained that it will not engage in deficit spending to
satisfy populist demands. 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 |
V. GOLDI LTD.
Telephone 972 3 613 17 87
Fax 972 3 613 17 86
Email: info@vgoldi.com
21 Tuval Street
Diamond Exchange,
Yahalom Bldg.
Ramat Gan 5252236 Israel
A private limited company,
incorporated as per file No. 51-340945-8 on the 15.05.2003.
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.
1. Kukadia Pravinbhai, 50%,
2. Patel Girish Kumar, 50%.
1. Kukadia Pravinbhai, General
Manager,
2. Patel Girish Kumar, of India.
Importers,
marketers and exporters of diamonds of all sorts.
Around 90% of
sales are for export.
Among foreign
suppliers: SHREE RAMKRISHNA EXPORT, of India (an affiliate).
Operating from
owned office premises, on an area of 110 sq. meters, in 21 Tuval Street (also
referred to as 54 Bezalel Street), Diamond Exchange, Yahalom Building, 6th
floor, rooms #1793-96, Ramat Gan.
Subject’s General
Manager is the sole employee (same as in previous years), working mainly with
buyers, who operate from subject's offices.
Financial data not
forthcoming.
There are 3 charges for unlimited amounts
registered on the company's assets (all assets, including financial and fixed
assets), in favor of The State Bank of India Ltd. (charges placed in 2008, in
2012 and in December 2014).
2009 sales claimed
to be US$ 58,000,000 (over 90% for export).
2010 sales claimed
to be US$ 117,000,000 (over 90% for export).
2011 sales claimed
to be US$ 133,000,000 (some 90% for export).
2012 sales claimed
to be US$ 167,000,000 (some 90% for export).
2013 sales claimed
to be around US$ 170,000,000 (some 90% for export).
2014 sales claimed
to be around US$ 195,000,000 (some 90% for export).
Projected 2015
sales are US$ 220,000,000 (90% for export).
Subject is
affiliated to SHREE RAM KRISHNA EXPORT PVT. LTD. (SRK), of India – see more
CHARACTER below.
State Bank of India Ltd. (SBI), Ramat Gan
Branch (No. 001), Ramat Gan.
Nothing
unfavorable learned.
Subject is part of
the Mumbai-based leading Indian Group SHREE RAM KRISHNA EXPORT, a DTC
sightholder, with affiliates worldwide.
Israel's diamond
industry continued the growth trend in all trade parameters in 2014, after the
impressive growth in 2013 in most parameters, based on the data by Israel's
Diamond Administration (IDA) at the Ministry of Economics: Net export of
polished diamonds rose by 0.6% from 2013, reaching US$6.269 billion (after
rising 11.6% in 2013), and net rough diamond exports totaled US$3.061 billion
in 2014, up 4.2% from 2013 (after a mere rise in 2013). The market has been
volatile over the last years after experiencing its worst depression due to the
global economic crisis, then recovered in 2010 but fell again in 2012.
The recovery in 2013
and 2014 is positive news for the local branch (still away from its peak on the
eve of the crisis with export of polished diamonds of US$ 7 billion), however
it is reported that profit margins have been decreasing due to smaller gaps
between rough and polished diamond prices (leading the diamond dealers to
search for new rough sources in hope to decrease costs). Overall, IDA reports
that 2014 was tough year for the diamond industry in Israel and globally.
In addition, the
local diamond sector has been negatively affected by 2 other significant
factors: the production of counterfeit diamonds, whose quality keeps improving
(harming the raw diamonds market) and the "underground bank" affair –
see below. As a result, local diamond dealers report on difficulties in
executing transactions and bad atmosphere in the branch.
The data published
for the 1st half of 2015 (compared to 1stH 2014) points on a
negative reverse trend in all parameters: Net export of polished diamonds
represents 17% decrease, reaching US$2,975 million, and net rough diamond
exports decreased by 22%, totaled US$ 1,361 million. Net imports of polished
diamonds fell by 17%, reaching US$ 1,793 million, while net import of rough
diamonds fell 21% totaling US$ 1,623 million.
The United States
continued to be Israel’s major market for polished diamonds, accounting for 44%
of the market in the 1stH 2015 (some recovery from 39% in latest years). Hong
Kong is 2nd largest market with 31% of exports (30% in 2014), then
Switzerland 10%, Belgium 6.5%, and U.K. accounting for 2.4% 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 stood on US$ 1.5 billion, down from US$ 2.4 billion in the eve of the
global crisis.
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 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 said 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.
Since mid-2014 the
State Attorney started to file indictments against central defendants in the
affair, initially against dealers who
provided foreign currency services to the "underground bank", for
felonies of money laundering and tax evasion in volumes of US$ millions (in
June 2015 the court made the first conviction in the affair, sending a foreign
currency dealer who pretended also to be a diamond dealer, for 4 years prison
and a fine, part of a plea bargain), and in October 2015 indictments for severe
charges pressed against 5 diamond firms and persons for felonies committed in
volumes of millions US$.
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 –
-
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.66.79 |
|
|
1 |
Rs.101.37 |
|
Euro |
1 |
Rs.73.46 |
|
ILS |
1 |
Rs.17.31 |
Note :
Above are approximate rates obtained from sources believed to be correct
INFORMATION DETAILS
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Analysis Done by
: |
HEE |
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Report Prepared
by : |
TPT |
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 |
|
|
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.