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MIRA INFORM REPORT
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Report No. : |
502442 |
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Report Date : |
13.04.2018 |
IDENTIFICATION DETAILS
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Name : |
ZABAN DIAM |
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Registered Office : |
1 Jabotinsky
Street, Diamond Exchange, Maccabi Bldg. Ramat Gan 5252001 |
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Country : |
Israel |
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Date of Incorporation : |
02.11.2009 |
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Legal Form : |
Private Limited Company |
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Line of Business : |
Importers, Traders, Dealers and Exporters of Diamonds (Small Size, up to 1 Carat). |
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No. of Employees : |
2 |
RATING & COMMENTS
(Mira Inform has adopted New Rating mechanism w.e.f. 23rd
January 2017)
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MIRA’s Rating : |
B |
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Credit Rating |
Explanation |
Rating Comments |
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B |
Medium Risk |
Business dealings permissible on a regular
monitoring basis |
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Status : |
Moderate |
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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
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Country Name |
Previous
Rating (30.09.2017) |
Current Rating (31.12.2017) |
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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 Risk |
A2 |
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Moderately Low Risk |
B1 |
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Moderate Risk |
B2 |
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Moderately High Risk |
C1 |
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High Risk |
C2 |
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Very High Risk |
D |
ISRAEL - ECONOMIC OVERVIEW
Israel has a technologically advanced free market economy. Cut diamonds,
high-technology equipment, and pharmaceuticals are among its leading exports.
Its major imports include crude oil, grains, raw materials, and military
equipment. Israel usually posts sizable trade deficits, which are offset 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 weathered the 2011 Arab Spring because strong trade ties outside the Middle
East insulated the economy from spillover effects.
Slowing domestic and international demand and decreased investment
resulting from Israel’s uncertain security situation reduced GDP growth to an
average of roughly 2.8% per year during the period 2014-17. 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 in the last decade. Political and regulatory
issues have delayed the development of the massive Leviathan field, but
production from Tamar provided a 0.8% boost to Israel's GDP in 2013 and a 0.3%
boost in 2014. One of the most carbon intense OECD countries, Israel generates
about 57% of its power from coal and only 2.6% from renewable sources.
Income inequality and high housing and commodity prices continue to be a
concern for many Israelis. 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. Government officials have called for reforms to
boost the housing supply and to increase competition in the banking sector to
address these public grievances. Despite calls for reforms, the restricted
housing supply continues to impact the well-being of younger Israelis seeking
to purchase homes. Tariffs and non-tariff barriers, coupled with guaranteed
prices and customs tariffs for farmers kept food prices high in 2016. Private
consumption is expected to drive growth through 2018 with consumers benefitting
from low inflation and a strong currency.
In the long term, Israel faces structural issues, including low labor participation
rates for its fastest growing social segments - the ultraorthodox and
Arab-Israeli communities. Also, Israel's progressive, globally competitive,
knowledge-based technology sector employs only about 8% of the workforce, with
the rest mostly employed in manufacturing and services - sectors which face
downward wage pressures from global competition. Expenditures on educational
institutions remain low compared to most other OECD countries with similar GDP
per capita.
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Source
: CIA |
Company name & address
ZABAN DIAM
(Trading as ZABAN
DIAM
Telephone 972 3 575 24 28; 516 99
91
Fax 972 3 516 99 93
Email: info@zaban-bechor.co.il
1 Jabotinsky
Street
Diamond Exchange,
Maccabi Bldg.
Ramat Gan 5252001 Israel
HISTORY
& LEGAL FORMATION
A private limited
company, incorporated as per file No. 51-434309-4 on the 02.11.2009.
SHARE
CAPITAL
Authorized share
capital of NIS 40,000.00, divided into:
40,000 ordinary
shares of NIS 1.00 each, of which 100 shares amounting to NIS 100.00 were
issued.
SHAREHOLDERS
Subject is fully
owned by Bechor Shushan Zaban.
SOLE DIRECTOR
Bechor Shushan Zaban, General Manager, also a registered
authorized reporting official, born 1953.
BUSINESS
Importers,
traders, dealers and exporters of diamonds (small size, up to 1 carat).
10% of sales are
for export.
Operating from
office premises, owned by shareholders, on an area of 200 sq. meters, in 1
Jabotinsky Street, Diamond Exchange (23rd Floor, Room 40 - 2340),
Maccabi Building, Ramat Gan.
Having 2 employees
in subject (same as in 2017). Also using other Group's employees.
Having 180 employees serving ZABAN Group in 2017.
MEANS
Financial data not
forthcoming, however ZABAN Group is known to be financially solid.
There are 9 charges for unlimited amounts registered on the company's
assets (financial assets and vehicles), in favor of Mizrahi Tefahot Bank Ltd.,
Bank Hapoalim Ltd., Bank Leumi Le'Israel Ltd. and a leasing company (last 2
charges placed October-November 2017 on vehicles).
REVENUES
Sales figures not
forthcoming.
OTHER
COMPANIES
Also owned by Bechor Shushan Zaban:
ZABAN BECHOR JEWELLERY LTD., founded 1975, incorporated 1995, designers, manufacturers,
importers, exporters and marketers of fancy jewelry made of gold, and gold
combined with precious stones, diamonds, etc.
KORAL MILLENIUIM LTD., operating 7 retail stores under the name "B.
Zaban", as well as operating 38 points of sales for jewelry and watches
within the stores of the HAMASHBIR DEPARTMENT STORES, under the style
"Coral Jewelry".
Bechor Shushan Zaban is also involved in real estate, among others via:
MIKADO SHILUV PROMOTION AND BUILDING LTD.
RAMOT MIKADO CENTER LTD., both partly owned by Bechor Shushan Zaban.
BANKERS
Mizrahi Tefahot Bank
Ltd., Diamond Business Branch (No. 466), Ramat Gan.
CHARACTER
AND REPUTATION
Nothing
unfavorable learnt.
Subject’s
officials refused to disclose financial data.
Bechor Zaban is a well-known figure in the local jewelry industry and
trade. “Zaban Jewelry” is a well-familiar brand.
Prior to establishing subject, Bechor Zaban held some 50% in the leading
jewelry company PAZ CHEN, then a public limited company whose shares traded on
the Tel Aviv Stock Exchange. During the 1990’s he sold most of his shares in
this company and in 1997, he sold his remaining 6% in this company, for a sum
of NIS 5.6 million.
Export (net) of
polished diamonds from Israel in the first 9 months of 2017 totaled US$ 3,383
million, which represents 11.8% decrease compared to the parallel period in
2016, while export of net rough diamonds fell 10.4% in this period, reaching
US$ 1,796 million. That is in contrast to the figures in 2016, which showed
signs of recovery for the Israeli diamond trade, coming after the export of
diamonds from Israel experienced a drastic fall by 20% in 2015 from 2014 (down
40% from 2011).
Net export of
polished diamonds in 2016 decreased by 6.4% from 2015, reaching US$ 4,675
compared to US$ 4,993 million in 2014 (after 0.6% rise in 2014 and 11.6% in
2013), however net rough diamonds exports jumped 23.1% to US$2,702 million (in
2015 fell 28.3% from 2014, after 4.2% rise in 2014, and a mere rise in 2013).
Yet the figures are well away from its peak on the eve of the crisis with
export of polished diamonds of US$ 7 billion.
In total, diamonds
export (polished and rough) in 2017 were expected to sum up to US$ 7 billion,
7% lower than in 2016, from the Ministry of Economy forecast.
The market has
been volatile over the last years after experiencing its worst depression due
to the global economic crisis. According to Israel's Diamond Administration
(IDA) at the Ministry of Economics, profit margins have been decreasing due to smaller
gaps between rough (increasing) and polished (decreasing) diamond prices.
In addition, the
local diamond sector has been negatively affected by other significant factors:
the production of counterfeit diamonds, whose quality keeps improving (harming
the raw diamonds market), the entrance of new rules by the local Tax
Authorities on the Diamond Exchange for enforcing money laundering, and the
"underground bank" affair – as below.
As a result, local
diamond dealers report on difficulties in executing transactions and bad
atmosphere in the branch. Signs of recovery appeared towards the last quarter
of 2016 – mainly due to the growing stability of the market and the industry’s
agreement with the Israel Tax Authority in December, yet the market is still volatile,
as witnessed with the endurance of the depression trend during 2017.
Net imports of
polished diamonds totaled US$ 3,282 million in 2016, 5.7% decrease from 2015,
while net import of rough diamonds reached US$ 3,246 million, up 16.7% from
2015.
Net imports of
polished diamonds decrease by 15.1% in the first 9 months of 2017 and totaled
US$ 2,015 million, compared to the parallel period in 2016, whereas net import
of rough diamonds reached US$ 2,089 million, down 11.6% from 2016.
The United States
continued to be Israel’s major market for polished diamonds, accounting for 45%
of the market in the first 9 months 2017 (was 39% in 2016). Hong Kong is 2nd
largest market with 30% of exports (26% in 2016), followed by Switzerland 9%
(7%), Belgium 8% (8%), and the rest of the world account for the remaining 8%
of Israel's polished diamond export.
In 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" (known as the "Check List" Affair)
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, and for a while to paralysis (especially in raw
diamonds purchase) due to uncertainty among local and foreign dealers. Later in
2012 the Police decided to lower the profile of the investigation for a while
(pressure from the diamond branch due to the continuing damage inflicted and
the Government (losing US$ hundred millions from decrease in tax collection),
but resumed investigation in 2013.
In mid-2014, based
on the Police and Tax Authorities recommendations, the State Attorney started
the process of filing indictments against central defendants in the affair,
initially against dealers who provided foreign currency services to the
"bank" (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, a fine and confiscation of assets in volume of NIS
millions, part of a plea bargain). Since late 2015 indictments for severe
charges pressed against 11 diamond dealers and their firms for tax felonies
committed and issuing fictitious invoices in volumes of millions US$ (latest
indictments filed by the Tel Aviv District Attorney in August 2016). Their
cases are pending.
SUMMARY
Notwithstanding
the refusal to disclose financial details, considered good for trade
engagements.
FOREIGN EXCHANGE RATES
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Currency |
Unit
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Indian Rupees |
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US Dollar |
1 |
INR 65.35 |
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1 |
INR 92.70 |
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Euro |
1 |
INR 80.80 |
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ILS |
1 |
INR 18.56 |
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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VAR |
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Report Prepared
by : |
TPT |
RATING EXPLANATIONS
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Credit Rating |
Explanation |
Rating Comments |
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A++ |
Minimum Risk |
Business dealings permissible with minimum
risk of default |
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A+ |
Low Risk |
Business dealings permissible with low
risk of default |
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A |
Acceptable Risk |
Business dealings permissible with
moderate risk of default |
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B |
Medium Risk |
Business dealings permissible on a regular
monitoring basis |
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C |
Medium High Risk |
Business dealings permissible preferably
on secured basis |
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D |
High Risk |
Business dealing not recommended or on
secured terms only |
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NB |
New Business |
No recommendation can be done due to
business in infancy stage |
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NT |
No Trace |
No recommendation can be done as the
business is not traceable |
NB is stated where there is insufficient information to facilitate rating. However, it is not to be considered as unfavourable.
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 are as follows:
·
Financial
condition covering various ratios
·
Company
background and operations size
·
Promoters
/ Management background
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Payment
record
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Litigation
against the subject
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Industry
scenario / competitor analysis
·
Supplier
/ Customer / Banker review (wherever available)
This report is issued at
your request without any risk and responsibility on the part of MIRA INFORM
PRIVATE LIMITED (MIPL) or its officials.