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Report No. : |
351050 |
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Report Date : |
27.11.2015 |
IDENTIFICATION DETAILS
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Name : |
LIDAN DIAM |
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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 : |
09.02.2004 |
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Legal Form : |
Private limited company |
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Line of Business : |
Traders,
importers, marketers and exporters of polished diamonds. |
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No. of Employee : |
7 |
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, 2015
|
Country Name |
Previous Rating (31.12.2014) |
Current Rating (31.03.2015) |
|
Israel |
B1 |
B1 |
|
Risk Category |
ECGC
Classification |
|
Insignificant |
A1 |
|
Low |
A2 |
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Moderate |
B1 |
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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 |
LIDAN
DIAM
Telephone 972 3
613 01 48
Cellular 972 54 397 51 37
Fax 972
3 613 01 42
21 Tuval
Street
Diamond
Exchange, Yahalom Bldg.
RAMAT GAN 5252236 ISRAEL
A
private limited company, incorporated as per file No. 51-350923-2 on the
09.02.2004.
Originally
registered under the name BRADLEY REZNIK DIAM
Authorized
share capital of NIS 100,000.00 divided into:
100,000 ordinary shares, of
NIS 1.00 each,
of
which 100 shares amounting to NIS 100.00 were issued.
Subject is fully owned by Ms. Meirav Reznik.
Ms.
Meirav Reznik
Bradley Reznik, born 1968, husband of Meirav.
Traders,
importers, marketers and exporters of polished diamonds.
Over 90%
of sales are for export.
Operating
from owned office premises, on an area of 60 sq. meters, in 21 Tuval Street
(formerly 54 Bezalel Street), Diamond Exchange, Yahalom Bldg. (aka Diamond
Tower), 18th floor (to where they moved from 15th
floor), Ramat Gan
Having
7 employees.
Current
diamond inventory is valued at US$ 4,500,000.
Owned
property in the Yahalom Bulding, Diamond Exchange (where subject operates from)
is highly valued.
There
are 3 charges for unlimited amounts registered on the company's assets (all
assets, including financial and real estate assets), in favor of Union Bank of
Israel Ltd. 2 charges placed in 2004, 1 in March 2015.
2014
sales claimed to be US$ 15,000,000, over 90% of which were for export.
Projected
2015 sales are US$ 15,000,000, over 90% of which for export.
Union
Bank of Israel Ltd., Diamond Exchange Branch (No. 629), Ramat Gan.
Nothing unfavorable learned.
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.
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.
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.
Note:
Subject does not have a P.O. Box (sometimes diamond dealers are using internal
post box, but it is not for outside correspondence).
DIAMOND INDUSTRY – INDIA
-
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.66.38 |
|
|
1 |
Rs.100.45 |
|
Euro |
1 |
Rs.70.55 |
|
ILS |
1 |
Rs.17.19 |
INFORMATION DETAILS
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Analysis Done by
: |
KIN |
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Report Prepared
by : |
TRU |
RATING EXPLANATIONS
|
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 |
|
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 |
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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 |
|
<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.