|
Report No. : |
346981 |
|
Report Date : |
30.10.2015 |
IDENTIFICATION DETAILS
|
Name : |
KGK JEWELLERY (HK) LTD. |
|
|
|
|
Registered Office : |
18/F., Peninsula Square, 18 Sung On Street, Hunghom, Kowloon |
|
|
|
|
Country : |
Hongkong |
|
|
|
|
Date of Incorporation : |
19.02.2003 |
|
|
|
|
Com. Reg. No.: |
33368774 |
|
|
|
|
Legal Form : |
Private Limited Company |
|
|
|
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Line of Business : |
Manufacturer and Exporter of all kinds of Gold and Platinum Jewellery,
Gold and Silver Jewellery,
Diamond Gold Jewellery. |
|
|
|
|
No. of Employees : |
35. (Including Associates in Hong Kong) |
RATING & COMMENTS
|
MIRA’s Rating : |
Ba |
|
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 |
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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) |
|
Hongkong |
A1 |
A1 |
|
Risk Category |
ECGC
Classification |
|
Insignificant |
A1 |
|
Low |
A2 |
|
Moderate |
B1 |
|
High |
B2 |
|
Very High |
C1 |
|
Restricted |
C2 |
|
Off-credit |
D |
HONGKONG - ECONOMIC OVERVIEW
Hong Kong has a free market economy, highly dependent on
international trade and finance - the value of goods and services trade,
including the sizable share of re-exports, is about four times GDP. Hong Kong
has no tariffs on imported goods, and it levies excise duties on only four
commodities, whether imported or produced locally: hard alcohol, tobacco,
hydrocarbon oil, and methyl alcohol. There are no quotas or dumping laws. Hong
Kong's open economy left it exposed to the global economic slowdown that began
in 2008. Although increasing integration with China, through trade, tourism,
and financial links, helped it to make an initial recovery more quickly than
many observers anticipated, its continued reliance on foreign trade and
investment leaves it vulnerable to renewed global financial market volatility
or a slowdown in the global economy. The Hong Kong government is promoting the
Special Administrative Region (SAR) as the site for Chinese renminbi (RMB)
internationalization. Hong Kong residents are allowed to establish
RMB-denominated savings accounts; RMB-denominated corporate and Chinese
government bonds have been issued in Hong Kong; and RMB trade settlement is
allowed. The territory far exceeded the RMB conversion quota set by Beijing for
trade settlements in 2010 due to the growth of earnings from exports to the
mainland. RMB deposits grew to roughly 12.5% of total system deposits in Hong
Kong by the end of 2014. The government is pursuing efforts to introduce
additional use of RMB in Hong Kong financial markets and is seeking to expand
the RMB quota. The mainland has long been Hong Kong's largest trading partner,
accounting for about half of Hong Kong's total trade by value. Hong Kong's
natural resources are limited, and food and raw materials must be imported. As
a result of China's easing of travel restrictions, the number of mainland
tourists to the territory has surged from 4.5 million in 2001 to 47.3 million
in 2014, outnumbering visitors from all other countries combined. Hong Kong has
also established itself as the premier stock market for Chinese firms seeking
to list abroad. In 2014 mainland Chinese companies constituted about 50% of the
firms listed on the Hong Kong Stock Exchange and accounted for about 60.1% of the
Exchange's market capitalization. During the past decade, as Hong Kong's
manufacturing industry moved to the mainland, its service industry has grown
rapidly. Credit expansion and tight housing supply conditions have caused Hong
Kong property prices to rise rapidly; consumer prices increased by more than
4.4% in 2014. Lower and middle income segments of the population are
increasingly unable to afford adequate housing. Hong Kong continues to link its
currency closely to the US dollar, maintaining an arrangement established in
1983. In 2014, Hong Kong and China signed a new agreement on achieving basic
liberalization of trade in services in Guangdong Province under the Closer
Economic Partnership Agreement, adopted in 2003 to forge closer ties between Hong
Kong and the mainland. The new measures, effective from March 2015, cover a
negative list and a most-favored treatment provision, and will improve access
to the mainland's service sector for Hong Kong-based companies.
|
Source
: CIA |
KGK
JEWELLERY (HK) LTD.
ADDRESS: 18/F.,
Peninsula Square, 18 Sung On Street, Hunghom, Kowloon, Hong Kong.
PHONE: 852-2723
9828, 2733 2222
FAX: 852-2739
7584, 2721 2575
E-MAIL: kgkhk@kgkgroup.com
Managing Director:
Mr. Sanjay Navrattan Kothari
Incorporated on: 19th February, 2003.
Organization: Private Limited Company.
Issued Share Capital: HK$117,000,000.00
Business Category: Jewellery
Trader.
Employees: 35. (Including associates in Hong Kong)
Main Dealing Banker: Standard
Chartered Bank (Hong Kong) Ltd., Hong Kong.
Banking Relation: Satisfactory.
Registered Head Office:-
18/F., Peninsula Square, 18 Sung On Street, Hunghom,
Kowloon, Hong Kong.
China Factory:-
KGK Jewellery Manufacturing Ltd.
Panyu, Guangdong Province, China.
[Tel: (86-20) 3999 0700; Fax: (86-20) 3480 6759]
Holding Company:-
United Pacific Excel Ltd., British Virgin Islands.
Associated/Affiliated Companies:-
KGK Group of Companies
Far East Gems Inc., Japan.
K Jewels (Pty.) Ltd., South Africa.
K.G.K. Diamonds B.V.B.A., Belgium.
KGK China Holdings (HK) Ltd., Hong Kong.
KGK Creation Guangzhou Ltd., China.
KGK Creations (India) Pvt. Ltd., India.
KGK Creations Pvt. Ltd., India.
KGK Diamond Israel Ltd., Israel.
KGK Diamonds & Jewellery LLC, UAE.
KGK Diamonds (Far East) Inc., Japan.
KGK Diamonds (HK) Ltd., Hong Kong.
KGK Diamonds (I) Pvt. Ltd., India.
KGK Diamonds (India) Pvt. Ltd., India.
KGK Diamonds (Shanghai) Ltd., China.
KGK Diamonds (SZ) Co. Ltd., China.
KGK Diamonds (Taiwan) Ltd., Taiwan.
KGK Diamonds Botswana (Pty) Ltd., Botswana.
KGK Diamonds Co. Ltd., Thailand.
KGK Diamonds LLC, USA.
KGK Enterprises, India.
KGK Entice (India) Pvt. Ltd., India.
KGK Entice Jewellery (Shenzhen) Ltd., China.
KGK Gems (Far East) Ltd., Hong Kong.
KGK Gems (HK) Ltd., Hong Kong.
KGK Gems Ltd., Thailand.
KGK Gems, India.
KGK Infrastructure (India) Pvt. Ltd., India.
KGK Investment (HK) Ltd., Hong Kong.
KGK Investment USA (HK) Ltd., Hong Kong.
KGK Jewellery (China) Ltd., Hong Kong.
KGK Jewellery (HK) Ltd., Hong Kong.
KGK Jewellery Inc., Japan.
KGK Jewellery Inc., USA.
KGK Jewellery LLC, USA.
KGK Jewellery Manufacturing Ltd., Hong Kong.
KGK Jewelry Inc., China.
KGK Jewelry
Manufacturing Ltd., Japan.
KGK Jewelry Pvt.
Ltd., India.
KGK Jewels (Pty)
Ltd., South Africa.
KGK Mining (HK) Ltd., Hong Kong.
KGK Precious (HK) Ltd., Hong Kong.
KGK Properties (HK) Ltd., Hong Kong.
KGK Real Estate (HK) Ltd., Hong Kong.
KGK Resources (HK) Ltd., Hong Kong.
KGK Retail Holdings (HK) Ltd., Hong Kong.
Precious Trade Inc., US.
S. D. Diamond LLC, Russia.
Star Rough Diamonds (Pty) Ltd., South Africa.
etc.
33368774
0833804
Managing Director: Mr.
Sanjay Navrattan Kothari
HK$117,000,000.00
(As per registry dated 22-09-2015)
|
Name |
|
No. of shares |
|
United Pacific
Excel Ltd. 263 Main Street, P.O. Box 2196, Road Town, Tortola,
British Virgin Islands. |
|
115,720,000 |
|
Sanjay Navrattan KOTHARI |
|
652,800 |
|
Manju KOTHARI |
|
627,200 |
|
|
|
–––––––––– |
|
|
Total: |
117,000,000 ========= |
(As per registry dated 22-09-2015)
|
Name (Nationality) |
Address |
|
Sanjay Navrattan KOTHARI |
House A, 8623 Tai Po Road, Shatin,
New Territories, Hong Kong. |
(As per registry dated 22-09-2015)
|
Name |
Address |
Co. No. |
|
Louis Lai & Luk Co. Secretarial Services Ltd. |
9/F., Surson Commercial Building, 140-142 Austin Road,
Tsimshatsui, Kowloon, Hong Kong. |
0686503 |
The subject was
incorporated on 19th February, 2003 as a private limited liability company
under the Hong Kong Companies Ordinance.
Formerly the subject
was located at 14/F., Chevalier House, 45-51 Chatham Road South, Tsimshatsui,
Kowloon, Hong Kong, moved to the present address in March 2014.
Apart from these,
neither material change nor amendment has been ever traced and noted.
Activities: Manufacturer
and Exporter.
Lines: All
kinds of gold and platinum jewellery, gold and silver jewellery, diamond gold
jewellery
Employees: 35. (Including associates in Hong Kong)
Commodities Imported: India,
Europe, US, etc.
Markets: Japan,
US, UAE, Korea, Australia, Middle East, South Africa, etc.
Terms/Sales: CAD, L/C, T/T or as per
contracted.
Terms/Buying: L/C, T/T, D/P, etc.
Hong Kong Jewelry Manufacturers’ Association,
Hong Kong.
The Hong Kong General Chamber of Commerce,
Hong Kong.
[Membership No. HKK0333]
The Italian Chamber of Commerce, Hong Kong.
The Indian Chamber of Commerce Hong Kong, Hong Kong.
Issued Share Capital: HK$117,000,000.00
Mortgage or Charge:
(See attachment)
Profit or Loss: Making
a small profit every year.
Condition: Keeping in a satisfactory
condition.
Facilities: Making active use of general
banking facilities.
Payment: Met trade commitments as
contracted.
Commercial Morality:
Satisfactory.
Banker: Standard Chartered Bank
(Hong Kong) Ltd., Hong Kong
Standing: Good.
KGK Jewellery (HK)
Ltd. is a subsidiary company of United Pacific Excel Ltd. which is a
BVI-registered firm. The subject has
increased its issued share capital from HK$16,060,002 to HK$23,860,002, to
HK$39,000,000 and further to HK$117 million.
United Pacific Excel
is holding 98.91% of the subject’s interests. The minor shareholders are Sanjay
Navrattan Kothari and Manju Kothari. The
former is holding 0.55% interests while the latter, 0.54%.
The subject in fact
is a member of the KGK Group which was established in 1905. The KGK Group is a global corporation based
in India with fully integrated operations in diamonds, coloured gemstones and
jewellery. From procurement to
manufacturing and from marketing to retailing, the Group is present across the
full value chain of the industry with offices spread across the world.
KGK Group has been a
DTC Sight Holder since 1997. KGK has been
cutting and manufacturing diamond roughs into polished diamonds in Russia,
South Africa, India and China.
Currently, the
subject is trading in the following commodities:-
|
Product/Service |
|
Fine Jewellery |
|
Precious and Semi-Precious Jewellery |
|
Jewellery – Semi-Precious Stone |
|
Jewellery – Platinum |
|
Jewellery – Pearl |
|
Jewellery – Gemset |
|
Jewellery – Diamond |
The subject is
engaged in manufacturing and exporting jewellery studded with Diamonds,
Precious & Semi Precious stones. It is
significant for its diamond necklaces, diamond bangles, earrings, bracelets,
bangles, pendants, etc.
Prime markets are
Japan, the United States, South Korea, Australia, the Middle East, South
Africa, Russia, etc.
The unit price of the
subject’s high-end products ranges from US$6,500 to 5,00,000.
The Group now has set
up a factory in Panyu, Guangzhou City, Guangdong Province, China employing
about 300 persons. Products are exported
to Japan, the Middle East, North America and Western Europe.
In China, the Group
has had the following associated firms:-
· KGK Diamonds (Shanghai) Ltd.;
· KGK Diamonds (SZ) Co. Ltd.; &
· KGK Jewellery Manufacturing Ltd.
The foundation of the
KGK Group was laid in the year 1905, when Mr. Shri Keshrimalji Kothari started trading
in coloured gemstones simultaneously from India and Burma. Assisted by his son, Mr. Shri Ghisilalji
Kothari, the business expanded from Jaipur to Chennai, and then to Hong Kong. By the 1970’s with new leadership at the helm
of the Group, the business operations diversified into diamonds and to new
global locations such as the United States, Thailand, Japan, etc. Now KGK Group has had business concerns in
fourteen countries of the world.
In July 2009, Martin
Flyer Ltd. [Martin Flyer], a US-based firm, confirmed its partnership and
strategic alliance with KGK Group.
In order to penetrate
the international market further, KGK Group has taken part in fairs and
exhibitions held in Hong Kong and other foreign large cities.
It has taken part in
the following shows and exhibitions:-
United States
· JCK Las Vegas Show
Europe
· Baselworld, Switzerland
Hong Kong
· HK International Jewellery Show
· HK Jewellery & Gem Fair
China
· Shenzhen International Jewellery Fair
Asia (other than Hong Kong and China)
· Bangkok Gems & Jewelry Fair, Thailand
· Bangkok Gems & Jewelry Fair, Thailand
· India International Show
· International Jewellery Tokyo, Japan
· Jaipur Jewellery Show
· Middle East
· Dubai International Jewellery Show
The subject is fully supported by the Group. History in Hong Kong is over twelve years and
eight months.
On the whole, consider the subject good for normal
business engagements.
Property
information of director and affiliate:-
1. Property
Location: 8/F., Robinson Garden
Apartments, 3B Robinson Road, Hong Kong.
Owner: Sanjay
Navrattan Kothari
Date of Purchase:
25-05-1988
Purchased Price:
HK$1,700,000 pt.
Incumbrances:-
|
Date of Mortgage |
Amount Consideration |
Mortgagee |
Nature |
|
23-01-1996 |
- |
Belgian Bank, Hong Kong Branch. [Business was taken over by Industrial
& Commercial Bank of China (Asia) Ltd.] |
Legal charge to secure banking facilities |
|
16-09-2003 |
- |
Fortis Bank Asia HK, Hong Kong Branch. [Name changed to Belgian Bank but the business
was taken over by Industrial & Commercial Bank of China (Asia) Ltd.] |
Deed of variation of M/N 6509498 and legal further
charge |
2. Property
Location: Flat 8 on 14/F. and Flat
I on 18/F., Star Mansion, 3 Minden Row, Kowloon, Hong Kong.
Owner: KGK Diamonds
(HK) Ltd.
Date of Purchase:
n.a.
Purchased Price:
n.a.
Incumbrances:-
|
Date of Mortgage |
Amount Consideration |
Mortgagee |
Nature |
|
23-05-2008 |
- |
ABN AMRO Bank N.V., Hong Kong Branch. |
Mortgage to secure general banking facilities granted
to KGK Diamonds (HK) Ltd. and KGK Jewellery Manufacturing Ltd. |
|
Date |
Particulars |
Amount |
|
22-08-2006 |
Instrument: Charge and Hypothecation of Book Debts Property: Hypothecation and charge to the Bank by way of charge
on all the book debts outstanding, moneys receivable, claims and bills Mortgagee: Bank of India, Hong Kong Branch. |
HK$24,000,000 |
|
22-08-2006 |
Instrument: Hypothecation of Tangible Moveable
Property Property: All tangible moveable assets of borrower including in
particular Furniture, Fixture, Plant and Machinery and stocks of all goods
etc., wheresoever situate and/or in transit Mortgagee: Bank of India, Hong Kong Branch. |
HK$24,000,000 |
|
07-11-2007 |
Instrument: General Letter of Hypothecation Property: Bills of exchange, and/or invoices, or any other
documents representing or relating to goods Mortgagee: Bank of India, Hong Kong Branch. |
All the money now granted by the Bank and the Company
now owing to the Bank |
|
07-11-2007 |
Instrument: Charge and Hypothecation of Book Debts Property: Hypothecation and charge to the Bank by way of charge
on all the book debts outstanding, moneys receivable, claims and bills Mortgagee: Bank of India, Hong Kong Branch. |
HK$30,000,000 |
|
07-11-2007 |
Instrument: Hypothecation of Tangible Moveable
Property Property: All tangible moveable assets of borrower including in
particular Furniture, Fixture, Plant and Machinery and stocks of all goods
etc., wheresoever situate and/or in transit Mortgagee: Bank of India, Hong Kong Branch. |
HK$30,000,000 |
|
03-12-2008 |
Instrument: General Letter of Hypothecation Property: Bills of exchange, and/or invoices, or any other documents
representing or relating to goods Mortgagee: Bank of India, Hong Kong Branch. |
All the money now granted by the Bank and the Company
now owing to the Bank |
|
22-07-2011 |
Instrument: Debenture made betweer and Bank as
lender & as trustee for itself and each SCB Group Company Property: By way of first floating charge all the undertaking,
property, assets and rights of the Borrower whatsoever and wheresoever both
present and future including, but not limited to its uncalled capital and
goodwill Mortgagee: Standard Chartered Bank
(Hong Kong) Ltd., Hong Kong. |
As a continuing security for the due and punctual
payment of the Secured Indebtedness |
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.
-
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.
-
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.
-
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.
-
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.
-
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.
-
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.
-
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.65.15 |
|
|
1 |
Rs.99.36 |
|
Euro |
1 |
Rs.71.25 |
INFORMATION DETAILS
|
Analysis Done by
: |
KAR |
|
|
|
|
Report Prepared
by : |
NIT |
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%)
This report is issued at your request without any
risk and responsibility on the part of MIRA INFORM PRIVATE LIMITED (MIPL) or
its officials.