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Report No. : |
352892 |
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Report Date : |
30.11.2015 |
IDENTIFICATION DETAILS
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Name : |
ASHISH DIAMONDS LTD. |
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Formerly Known As : |
A. DIAM LTD |
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Registered Office : |
P.O. Box 381
(5210301) 21 Tuval Street Diamond Exchange, Yahalom Bldg. Ramat Gan 5252236 |
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Country : |
Israel |
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Date of Incorporation : |
24.02.1997 |
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Legal Form : |
Private Limited Company |
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Line of Business : |
Importers,
exporters and marketers, dealing with both polished and rough diamonds. Also
manufacturers of diamonds, through sub-contractors. |
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No. of Employees : |
6 |
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 : |
Small Company |
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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) |
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Israel |
B1 |
B1 |
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Risk Category |
ECGC
Classification |
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Insignificant |
A1 |
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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.
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Source
: CIA |
ASHISH DIAM
Telephone 972 3 613 21 62
Fax 972
3 751 81 64
P.O. Box 381
(5210301)
21 Tuval Street
Diamond Exchange,
Yahalom Bldg.
RAMAT GAN 5252236 ISRAEL
A private limited
company, incorporated as per file No. 51-245395-2 on the 24.02.1997 under the
name A. DIAM LTD., which changed to the present name on 13.05.1997.
Authorized share
capital of NIS 32,700.00, divided into: 32,700
ordinary shares, of NIS 1.00 each, of which 1,000 shares amounting to NIS
1,000.00 were issued.
According to the Registrar of Companies, shareholders are:
1. Raxid Mehta, 85%,
2. Ashish Mehta, 15%, brother of
Raxid, of India.
On the 01.01.2013 Mr. Sailes C. Botra who
held 15% in subject sold his shares to Mehta Family (initially to Mr. Ankit
Shah, nephew of Raxid and Ashish, who later moved to the Indian affiliate and
his shares taken over by Raxid).
1. Raxid Mehta,
2. Ashish Mehta.
Importers,
exporters and marketers, dealing with both polished and rough diamonds.
Also manufacturers
of diamonds, through sub-contractors.
Around 35% of
sales are for export, rest is to the local market.
Among local
suppliers: DOV DIAMONDS, FISCHER DIAM
Operating from
offices premises, on an area of 131 sq. meters (35 sq. meters are owned, rest is
rented), in 21 Tuval Street (also referred to as 54 Bezalel Street), Diamond
Exchange, Yahalom Building (7th Floor, room 765), Ramat Gan.
Also operating
from offices in India and Hong Kong.
Having 6
employees, including both General Managers (same as in 2014, had 5 employees in
late 2013, had 6 employees in beginning of 2013, same as in 2012, had 5
employees in 2011).
There are some 35
employees in the Group, including overseas offices (similar to the previous
years).
Financial data not
forthcoming.
There are 2 charges for unlimited amounts registered on the company's
assets (both placed in 2007), in favor of The First International Bank of
Israel Ltd.
2007 sales claimed
to be over US$ 45,000,000, 60% of which were for export.
2008 sales claimed
to be over US$ 45 -46,000,000, 60% of which were for export.
We were informed
on some 30% decrease in sales in 2009, due to the crisis in the branch (around
US$ 32,000,000, some 40% of sales were for export).
2010 sales claimed
to be US$ 60,000,000, 45% of which were for export.
2011 sales claimed
to be US$ 65,000,000, 45% of which were for export.
2012 sales claimed
to be US$ 80,000,000, 30%-35% of which were for export.
2013 sales claimed
to be US$ 70,000,000, 35% of which were for export.
2014 sales claimed
to be US$ 70,000,000, 35% of which were for export.
A significant drop
in sales in noted in the first half of 2015, compared to the parallel period in
2014, said to be due to the unfavorable diamond business environment.
ELISDIAM LTD., 50%
owned by Raxid Mehta (other 50% owned by Eli Braverman), dealers, importers,
exporters and marketers of diamonds,
VIJAY DIAM, a
sister company in India, makes the purchasing for subject in India.
LOTUS STAR
LIMITED, a sister company in Hong Kong.
The First
International Bank of Israel Ltd., Diamonds Exchange Branch (No. 026), Ramat
Gan.
Nothing
unfavorable learned.
According to our sources,
subject is medium-sized relatively to the companies in its field in the Diamond
Exchange. It enjoys good reputation.
In the framework
of internal mediation procedures handled by the local Diamond Exchange regarding
business conflicts, in September 2009 it was reported that subject and its
owners are entitled to receive US$ 1.7 million from several diamonds dealers.
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.
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.
In July 2014 3
indictments were filed to the Tel Aviv District Court against central
defendants in the affair, who provided foreign currency services to the
"underground bank" (not against diamond dealers at this stage), for
felonies of money laundering and tax evasion in volumes of US$ millions. On
June 15th 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).
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).
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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
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Currency |
Unit
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Indian Rupees |
|
US Dollar |
1 |
Rs.66.75 |
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|
1 |
Rs.100.68 |
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Euro |
1 |
Rs.70.88 |
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ILS |
1 |
Rs. 17.19 |
Note :
Above are approximate rates obtained from sources believed to be correct
INFORMATION DETAILS
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Analysis Done by
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KAS |
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Report Prepared
by : |
ASH |
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.