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MIRA
INFORM REPORT
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Report No. : |
489365 |
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Report Date : |
07.02.2018 |
IDENTIFICATION DETAILS
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Name : |
DIAMANTI LTD. |
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Registered Office : |
21 Tuval Street,
Diamond Exchange, Yahalom Bldg., Ramat Gan 5252138 |
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Country : |
Israel |
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Date of Incorporation : |
1994 |
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Legal Form : |
Private Limited Company |
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Line of Business : |
Traders,
Importers, Exporters and Marketers of Small Diamond Stones. |
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No. of Employees : |
5 |
RATING & COMMENTS
(Mira Inform has adopted New Rating mechanism w.e.f. 23rd
January 2017)
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MIRA’s Rating : |
C |
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Credit Rating |
Explanation |
Rating Comments |
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C |
Medium High Risk |
Business dealings permissible preferably
on secured basis |
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Status : |
Moderate |
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Payment Behaviour : |
Slow |
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Litigation : |
Exist |
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 (30.06.2017) |
Current Rating (30.09.2017) |
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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
DIAMANTI LTD.
Telephone 972 3 571 61 70
Fax 972 3 612 25 70
Email: office@diamanti.co.il
21 Tuval Street
Diamond Exchange,
Yahalom Bldg.
Ramat Gan 5252138 Israel
HISTORY & LEGAL FORMATION
A private limited
company, incorporated as per file No. 51-332759-3 on the 25.11.2002, continuing
the activities of a non-registered partnership established in 1994, under the
name "DIAMANTI".
SHARE CAPITAL
Authorized share
capital of NIS 24,000.00, divided into:
24,000 ordinary
shares, of NIS 1.00 each, of which 10,050 shares amounting to NIS 10,050.00
were issued.
SHAREHOLDERS
1. Zion Bezalel, over 99%,
2. Joseph Tayar, less than 1%.
SOLE DIRECTOR
Zion Bezalel, General Manager, born 1961.
BUSINESS
Traders,
importers, exporters and marketers of small diamond stones.
Around 50% of
sales are for export.
Among clients:
AFIC DIAM
All purchasing is
from import.
Operating from
rented office premises, on an area of 40 sq. meters, in 21 Tuval Street
(formerly also referred to as 54 Bezalel Street), Diamond Exchange, Yahalom
Building, Room 2675, 26th Floor (to where they moved from the 16th
Floor), Ramat Gan.
Having 5 employees
(same as in previous years).
MEANS
Financial data not
forthcoming.
There are 2
charges for unlimited amounts registered on the company's assets, in favor of
Union Bank of Israel Ltd.
REVENUES
2011 sales claimed to be US$ 25,000,000, almost 50% of which was for export.
2012 sales claimed to be US$ 25,000,000, almost 50% of which was for export.
2013 sales claimed to be US$ 23,000,000, around 50% of which was for export.
2014 sales claimed to be US$ 21,000,000, around 50% of which was for export.
2015 sales claimed to be US$ 20,000,000, around 50% of which for export.
2016 sales claimed to be US$ 22,000,000, around 50% of which for export.
2017 sales claimed to be US$ 19,000,000, around 50% of which for export.
Subject's owner
and general manager informs us that the company is profitable.
OTHER COMPANIES
Subject's owners
are also involved in other companies. Among them:
VITAL LTD., a real
estate company.
BANKERS
Union Bank of
Israel Ltd., Diamond Exchange Branch (No. 62), Ramat Gan, account No.
370400/93.
A check with the Central Banks' database did not reveal anything
detrimental on subject’s a/m account.
CHARACTER AND REPUTATION
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.
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 October 2015
the State Attorney filed indictments against 5 diamond dealers and their
companies, subject and Zion Bezalel being among them,
for felonies of money laundering, issuing fictitious salary invoices and tax
evasion in volumes of US$ millions. The case (file no. 42750-10-15) is pending,
next hearing scheduled for 06/05/18.
Zion Bezalel told
us he is not allowed to comment on this matter.
In August 2016
further indictments were filed against 6 diamond dealers and their companies.
Mr. Zion Bezalel
is a veteran diamond dealer.
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.
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 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.
SUMMARY
In terms of
recommendation, the situation is complex. On one hand, we estimate that subject
is financially solid. On the other hand, there is the pending severe indictment
filed against subject and Mr. Bezalel, with its implication. It is difficult to
estimate the outcome, however we figure that –at least in the
short/medium-term- subject and Mr. Bezalel expected to continue their business
and meet their obligations. Follow-up is recommend and cautious in the credit
aspect.
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).
FOREIGN EXCHANGE RATES
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Currency |
Unit
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Indian Rupees |
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US Dollar |
1 |
INR 64.27 |
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1 |
INR 89.72 |
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Euro |
1 |
INR 79.52 |
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ILS |
1 |
INR 18.44 |
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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PRI |
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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
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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.