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MIRA
INFORM REPORT
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Report No. : |
500123 |
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Report Date : |
30.03.2018 |
IDENTIFICATION DETAILS
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Name : |
DANYA CEBUS LTD. |
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Registered Office : |
P.O. Box 800 (6025603), |
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Country : |
Israel |
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Financials (as on) : |
30.09.2015 |
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Date of Incorporation : |
24.12.1997 |
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Legal Form : |
Private Limited Company |
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Line of Business : |
Operating as a contracting company in Israel and
abroad in 5 fields: · Residential construction · Non-Residential construction · Infrastructure · Land development · Initiation for residential |
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No. of Employees : |
1,859 - Group |
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 : |
No Complaints |
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Litigation : |
-- |
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.
|
Source
: CIA |
Company name & address
DANYA CEBUS LTD.
Telephone 972
3 538 38 38
Fax 972 3 634 03 40
Email: amir@danya-cebus.co.il
P.O. Box 800 (6025603)
New Industrial Zone
Or Yehuda 6037601
Israel
HISTORY & LEGAL FORMATION
Originally incorporated as a private limited company and registered as
such as per file No. 51-256923-7 on the 24.12.1997.
Subject was
incorporated as a fully owned subsidiary of DANYA CEBUS HOLDINGS (1965) LTD.
(which changed its name to the present name AFRICA ISRAEL RESIDENCES LTD.),
originally established in 1965.
Subject begun operations on the 01.01.1998, assuming all the contracting
activities of parent company AFRICA ISRAEL INVESTMENTS LTD.
Converted into a public limited liability company on the 29.02.2000
(remained with same registration number), published a prospectus offering
shares to the public and shares are traded on the Tel Aviv Stock Exchange
since.
On the 22.07.2015, following a successful tender offer, re-converted to
a private limited company, and shares were de-listed from trade.
SHARE CAPITAL
Authorized share capital NIS 50,000,000.00, divided into -
50,000,000 ordinary shares of NIS 1.00 each,
of which
28,453,737 shares amounting to NIS 28,453,737.00 were issued.
SHAREHOLDERS
Subject is fully
owned by AFRICA ISRAEL INVESTMENTS LTD. (directly 49.1%, and via fully owned
subsidiary AFRICA ISRAEL TRADE AND AGENCIES LTD., 50.9%) a public limited
company, whose shares are traded on the Tel Aviv Stock Exchange (TASE),
controlled (48.13%) by Lev Leviev, part of Africa
Israel Group.
DIRECTORS
1. Avraham
Novogrocki, Chairman, General Manager of AFRICA ISRAEL INVESTMENTS,
2. Avinadav Grinshpon,
3. Menashe Sagiv,
4. Ms. Ronit Cohen Nissan.
GENERAL MANAGER
Ronen Ginsburg.
BUSINESS
Operating as a
contracting company in Israel and abroad in 5 fields:
1. Residential
construction - construction services for contractors, operating in Israel,
Romania and USA. Segment comprised 49% of Group's revenues in 2017 (42% in
2016).
2. Non-Residential
construction - construction services for contractors and the public sector,
constructors of offices, commercial areas, etc. Operating in Israel, Romania.
Segment comprised ~16% of Group's revenues in 2017 (20% in 2016).
3. Infrastructure
– operating as executing constructor of infrastructure projects (roads,
railways, etc.). This segment comprised 12% of Group's revenues in 2016 (11% in
2016).
4. Land
development – via subsidiary AFRICA ISRAEL RESIDENCES (a main client),
initiates projects in the construction field (land locating & acquisition,
construction, marketing of various residential and non-residential
constructions projects. Segment comprised 22% of Group's revenues in 2016 (27%
in 2015).
5. Initiation
for residential – this segment was added in 2017 (less than 1%).
Also, via
subsidiary CEBUS RIMON, manufactures of prefabricated building components, for
building frontal walls, acoustic walls, supporting walls, etc.
Among local
suppliers: ZVI COHEN & BROS. EARTHWORKS, ZIV KITCHENS, WITZNER BUILDING
AND FENCING, SHEFER ALUMINIUM INDS., PAN-DOOR
INDS., SKYLITE, GLOBAL METAL, ELAR ENGINEERING, SHAHAK ELEVATORS, HOD –
ASSAF INDS., Y. AMIT SYSTEMS, MAHAL PUMPS, B.G. (ISRAEL)
TECHNOLOGIES, SHOSHANI & WEINSTEIN, ALUMINUM CONSTR
Operating from headquarters rented offices,
on an area of 2,670 sq. meters, in
Website: www.danya-cebus.co.il
Having 1,859 employees serving DANYA CEBUS
Group as of end of 2017 (had 1,744 employees in the end of 2016). DANYA CEBUS
Group employs further thousands of workers in the different construction sites
in Israel and abroad, directly and through sub-contractors – according to
projects in hand.
MEANS
Parent company AFRICA ISRAEL INVESTMENTS has been losing
extensively in 2014, 2015, 2016, and presently financially troubled, facing
debts to bond holders in volume of NIS 2.7 billion, and may be heading
towards another debt arrangement (debt is eligible to be immediately
redeemable).
As of 31.12.2017, AFRICA INVESTMENTS has a deficit in working capital
(consolidated) of NIS 3,284 million (NIS 2,573 million solo), with a negative
value of assets (according to current market prices).
As such, a 'going concern' note was added to AFRICA INVESTMENTS’s
financial statements as of 31.12.2015 and since, including 2016 and
2017 annual statements.
Due to the debt to the bonds holders, the control shares held by Leviev
(48%) in AFRICA ISRAEL are offered in a tender to investors, to take over the
Group in order to recover it, or possibly sell parts.
In January 2018 a debt arrangement was approved by creditors. Currently
negotiations are taking place with the Tax Authorities.
On the 01.11.2017 AFRICA INVESTMENTS reported it received an
offer from Livingstone Kosberg, to purchase 54% of subject (+ and option to
purchase remaining shares) for NIS 324 million, giving subject a value of NIS
600 million.
AFRICA INVESTMENTS paid NIS ~140 million for the for subject's shares
held by the public in the tender offer published in July 2015, giving subject a
value of ~US$ 190 million.
In 2008 subject raised NIS 217 million from parent company AFRICA ISRAEL (NIS 10 million) and institutional investors
(the reminder).
In 2010, subject received a loan of NIS 240 million from a bank for the
acquisition of AFRICA ISRAEL RESIDENCES LTD.
In August 2015
subject received from a bank a short term credit line of NIS 50 million and a
long term loan (for 7 years) of NIS 224 million.
In August 2015
subject provided parent AFRICA ISRAEL INVESTMENTS a loan in volume of NIS 17
million, due to parent's liquidity stress (see more below).
Subject’s
consolidated assets as of 31.12.2017: NIS 5,888.3 million (NIS 4,992.7 million
as of 31.12.2016).
According to a report from October 2017, subject has as of 30.06.2017 an
equity of NIS 800 million.
According to the report, as of 30.06.2017 banks and institutional bodies
gave subject guarantees in volume of NIS 977 million for its construction
projects (see more in CHARACTER).
Accrued orders as of 31.12.2017 were NIS 5,720 million (of which NIS
2,687 million of residential construction).
Consolidated B/S
shows (last obtainable):
NIS
(thousands)
31.12.2014 30.09.2015
ASSETS
Current assets
Cash
and cash equivalents 413,376 361,449
Other
financial assets 345,693 453,948
Customers 375,349 453,091
Other
debtors and current assets 184,280 174,653
Building inventory for sale 1,477,632 1,693,726
2,796,330 3,136,867
Non-current assets
Fixed
assets 59,141 56,156
Land
inventory 844,415 1,026,962
Intangible
assets 81,514 81,369
Other assets 308,357 563,905
1,293,427 1,728,392
4,089,757 4,865,259
======== ========
LIABILITIES
Current liabilities 2,450,987 2,852,067
Non-current liabilities 947,155 1,348,636
Equity 691,615 664,556
4,089,757 4,865,259
======== ========
There are 15
charges for unlimited amounts, as well as 1 charge for the sum of NIS
30,000,000 registered on the company’s assets (financial assets and fixed
assets), in favor of Israel Discount Bank Ltd., Bank Hapoalim Ltd. and POALIM
TRUSTEE SERVICES LTD. (last charge placed February 2018, prior 6 charges placed
January-June 2017, prior 6 charges placed October-November 2016, prior charge
placed August 2015).
AFRICA ISRAEL
INVESTMENTS LTD. consolidated B/S shows:
NIS
(thousands)
31.12.2016 31.12.2017
ASSETS
Current assets
Cash
and cash equivalents 945,241 1,349,339
Other
financial assets 648,285 675,573
Customers 1,067,187 1,315,139
Other
debtors and current assets 2,111,456 519,353
Building inventory for sale 1,394,586 1,242,677
6,166,755 5,102,081
Non-current assets
Fixed
assets 833,726 430,233
Real
estate for investment 4,492,683 5,809,067
Land
inventory 2,013,955 2,747,151
Other assets 1,857,371 1881,110
9,197,735 10,867,561
15,364,490 15,969,642
======== =========
LIABILITIES
Current liabilities 8,776,829 8,386,578
Non-current liabilities 5,441,058 6,182,347
Equity 1,146,603 1,713,867
15,364,490 15,969,642
======== =========
REVENUES
Consolidated statement of income
NIS
(thousands)
For
the year end in 31.12
2012 2013 2014
Revenues 2,692,469 3,069,176 2,836,753
Gross profit 176,150 122,621 197,673
Operating profit 104,987 22,284 121,459
Profit before
taxes on income 87,667 9,770 123,211
Net profit 65,864 5,642 95,534
======== ======== ========
Consolidated 2015
revenues were NIS 3,254,490,000, making a gross profit of NIS 227,026,000, and
a pre-tax operating profit of NIS 134,135,000. Subject ended 2015 with a net
profit of NIS 104,134,000.
Consolidated 2016
revenues were NIS 4,450,542,000, making a gross profit of NIS 302,630,000, and
a pre-tax operating profit of NIS 221,553,000. Subject ended 2016 with a net
profit of NIS 172,280,000.
Consolidated 2017
revenues were NIS 4,226,488,000, making a gross profit of NIS 282,880,000, and
a pre-tax operating profit of NIS 214,464,000. Subject ended 2017 with a net
profit of NIS 184,585,000.
AFRICA ISRAEL
INVESTMENTS LTD. 2016 revenues were NIS 6,279,466,000, ending with a net loss
NIS 2,652,865,000.
2017 revenues were
NIS 6,057,995,000, making a net profit of NIS 88,100,000.
OTHER COMPANIES
Subsidiaries (all
100%, unless otherwise mentioned):
Residential and non- residential construction
FORMA PROJECTS LTD.,
DANYA INTERNATIONAL HOLDINGS LTD., holds the following
foreign companies: RUMBROL TRAIDING LTD. 97.6% (Cyprus); DANYA CEBUS CYPRUS
LTD. (Cyprus), holding DANYA CEBUS ROMANIA (Romania); DANYA CEBUS HOLDINGS U.S.
INC., holds DANYA CEBUS CONSTRUCTION LLC and DANYA CEBUS DEVELOPMENT LLC; TMDC
CONSTRUCTION COMPANY LTD, 45%.
Infrastructure
DANYA CEBUS MAFIL LTD.,
GEO DANYA LTD., 50%, infrastructure geotechnical works
CHINA CIVIL ENGINEERING CONSTRUCTION DANYA CEBUS JOINT
VENTURE, 49%, a Joint Venture (non-registered partnership), constructing NTA METROPOLITAN MASS TRANSIT SYSTEM’s Eastern part
of the "Red Line" segment of the Tel Aviv underground light train
railway.
NETIVEY HAYOVEL
LTD., 25%,
DERECH ERETZ
CONSTRUCTION JOINT VENTURE 33.3%,
DERECH ERETZ JOINT
VENTURE 18, 50%,
IMB ISRAEL METRO
BUILDERS, 40%
GEO DANYA LTD.,
50%,
DANYA CEBUS AND
CCECC REGISTERED PARTNERSHIP. 50%,
DANYA CEBUS
ELECTER EXECUTION BANK OF ISRAEL 50%,
Land Development
AFRICA ISRAEL RESIDENCES LTD., 74.21%, a public limited
company traded on the TASE, initiate residential building projects, current
market value
US$ 255 million. among holdings: MIGDALEI SOMIL LTD., 50%,
RAM NACH LTD., 57.5%, P.A. JERUSALEM DEVELOPMENT AND CONSTRUCTION LTD., 50%,
NEW GIVAT SHMUEL LTD., 50%, AFRICA URBAN RENEWAL LTD., AFRIRAM, 40%,
SAVION NURSERIES LTD., 21% (directly by subject)
AMAT NEVEH SAVYON LTD. 33% (directly by subject)
Other Activities
CEBUS RIMON INDUSTRIAL CONSTR
YUVALIM MANPOWER LTD.,
DANYA CEBUS MANPOWER LTD.,
DANYA SELA CONCRETE PUMPING LTD., 50%,
ALUM
DANYA LTD,
BEDEK
MANAGEMENT SERVICES LTD., 100%.
Also
holding 50% each in 2 joint venure project companies.
AFRICA ISRAEL
INVESTMENTS LTD., a public limited company (registration No. 52-000506-7),
subject parent, AFRICA ISRAEL INVESTMENTS LTD., subject parent, roof holding
company of AFRICA ISRAEL Having many subsidiaries, main ones are:
AFI DEVELOPMENT
PLC., 64.9%, publicly traded on the London Stock
Exchange), handles Russia and CIS
countries.
AFRICA ISRAEL PROPERTIES
LTD., 55.93%, publicly traded on the TASE, current market value US$ 702.9
million, initiation, establishment, preparation and operation of industrial
buildings, offices and commercial premises in Israel and Europe; also engaged in yielding properties in Israel, while European
yielding properties activities are handled by AFI EUROPE N.V. (100%), The
Netherlands.
AI HOLDINGS (USA) CORP. (AFI USA), 100%, American real
estate operations.
AFRICA ISRAEL
INDUSTRIES LTD. (AFI), 72.96%, publicly traded on the TASE, current market
value US$ 5 million, via PACKER STEEL INDUSTRIES LTD. and its
subsidiaries importers, manufacturers,
processors and marketers of stainless steel, aluminum products, metal and tin. Also traders in various sorts of metals.
AFRICA ISRAEL
TRADE AND AGENCIES LTD., a private limited company (Registration No.
51-170500-6), a holding company.
BANKERS
According to our
records (since we could not speak to subject's officials, we could not verify
a/m bank details):
Bank Leumi
Le’Israel Ltd., Principal Branch Tel Aviv (No. 800), Tel Aviv.
Also known to all
local banks, including Bank Hapoalim Ltd., HSBC Bank and The First
International Bank of Israel Ltd.
CHARACTER AND REPUTATION
In September 2016 subject’s large underground parking lot project in Tel
Aviv which was very close to completion, collapsed, killing 6 workers on site.
Matter is being investigated by the Police and other authorities, and several
senior executives were questioned. In the financial aspect of the collapse,
besides the immediate damages, subject is to pay the Tel Aviv Municipality, the
body that ordered the work, NIS 500,000 on every month of delay in completing
the lot.
In June 2017 an
agreement was signed with subject to re-construct the parking lot. In Q4-2017
an agreement was reached with the insurance company, who paid NIS 61.8 million
(subject receiving NIS 13.9 million directly).
The collapse follows several safety deficiencies and accidents in
subject’s projects, currently under investigation. In October 2017, a specialists
committee from the TECHNION ISRAEL INSTITUTE OF TECHNOLOGY determined that the
collapse is due to a panning failure. Matter is still under investigation.
In February 2016 it was reported that subject's General Manager, Mr.
Ronen Ginsburg, was questioned at the Antitrust Authority offices, in the
framework of an investigation regarding alleged price fixing in construction
tenders in Shoham Municipality, in which the Police raided subject's office and
confiscated documents. No further data was found on matter.
In January 2018, Mr. Ronen Ginsburg was questioned regarding a bribery
investigation which illegibly took place in the Rishon Le-Zion Municipality.
In March 2017 it was reported that subject will make deductions
regarding construction project in Light Train in Tel Aviv and the Ramon
International Airport due to higher costs.
A mediation verdict in the USA concerning a lawsuit against US
subsidiary DANYA CEBUS CONSTRUCTIONS LLC, it will pay US$ 5 million.
Apart of the above (and the financial stress of parent company, as
below), nothing unfavorable learned (besides several legal cases, all appear to
be relatively less insignificant, also part of normal current operations of a
big contracting company).
Subject is veteran
and one of the largest building and infrastructure contracting companies in
Israel. It enjoys very good reputation (we do not know how a/m collapse
affected that), including professionally and in payments morality. It is presently engaged in tens of projects, including
several very large ones in volumes of hundred millions.
Subject
is ISO9001:2000, SI-OHSAS 18001, ISO 14000, and more.
AFRICA ISRAEL INVESTMENTS de-listed subject's shares from trade in 2015
to address the 'Centralization Law' which requires public companies to level
out public holdings (avoid holdings in chaining), keeping subject's subsidiary AFRICA ISRAEL RESIDENCES publicly traded.
AFRICA ISRAEL
INVESTMENTS LTD. (AFI), publicly traded on the TASE, operate as land
developers, building contractors, and also managing and dealing, through
subsidiaries, yielding properties, hotels and resorts, industries, commerce and
agencies.
AFI was adversely hit by the 2008/9 crisis in the world's
financial and real estate markets, mainly due to its real estate holdings in Russia
and the USA, accumulating huge losses. Following AFI's announced in August 2009
on uncertainty in their ability to meet all its future obligations, debt
arrangement with its bonds holders was completed in May 2010 in volume of NIS
7.45 billion: part of the debt erased, a re-schedule for payments spread till
2021, and Leviev fueled his own capital (NIS 750 million) though remained in
control.
In the following years AFI's financial standing improved significantly
thanks to the debt arrangement, as well as recovery in global markets,
including the real estate market in Russia. Yet, in the past period, the global
economic circumstances kept changing for the bad, especially the financial
crisis in Russia, affecting AFI and the Groups' businesses, and AFI’s financial
situation severely deteriorated.
Another cause for AFI’s financial situation is due to financial disorders
in subsidiary AFRICA ISRAEL INDUSTRIES, caused by its subsidiary NEGEV CERAMICS LTD. (which headed the ceramics segment), following mismanagement
(on verge of fraud), which led to AFRICA INDUSTRIES huge loss in 2016
of NIS 286.1 million.
It should be noted that subject, although
serving as the construction arm of AFI, has been known to be financially solid.
In October 2017 it was reported that
subject’s management met with the bankers and institutional bodies which
provided the a/m guarantees to calm them down and re-establish financial trust.
In April 2017 AFI,
which fully owned NEGEV CERAMICS LTD., completed the
sale of NEGEV Group to NC HOLDINGS, as part of AFRICA’s debt arrangement. That
took-off a significant weight from AFI in way to recovery.
Presently, there
are 2 pending offers for investors to take over control in AFI.
Leviev is a world leading supplier and dealer in diamonds (including
mining).
In 2005 subject won one of its largest ever infrastructure projects, a
State PFI tender for the planning, execution and maintenance of the 431
Highway, a focal road (23 km) in the country, in a project was valued at NIS 2
billion. The highway was completed in February 2009 (to go back to State hands
by 2031).
In 2006, subject and subsidiary NETIVEY HAYOVEL raised NIS 1.8 billion
for the finance of the 431 Highway. The project brought heavy losses,
writing-off most of subject's equity (later, 2011 and onward, selling all its
holdings in the project).
As part of a
structural change in AFRICA Group, in November 2010 subject acquired the
control of AFRICA ISRAEL RESIDENCES LTD., the
Group's building for residence arm (publicly traded) from parent company
for NIS 648 million. Following the acquisition, subject started to operate in
the land development field.
In October 2012
subject won a tender to construct 2 bridges near Jerusalem in volume of NIS 170
million.
In December 2012
subject won a tender to construct a parking lot in Tel Aviv in volume of NIS 64
million.
In January 2013
subject won the Israel Airport Authority tender for constructing the new
control tower in Ben Gurion Intl. Airport, in a NIS 100 million project.
Subject and its Romanian
partner KBR won in 2013 a tender to construct a US military base in Romania in
volume of US$ 135 million, where subject's par estimated at US$70 million.
Other large projects abroad which subject won are
to
execute a residential and commercial project in Russia (initiated by an
affiliated company) in volume of US$ 200 million, and a shopping mall in
Romania, in volume of US$ 158 million.
In
2013 subject announced it enters the building contracting market in the USA,
signing agreement for the construction of two residential buildings in New
York, via subsidiary DANYA USA and entreprenurship firm HAP INVESTMENTS.
In mid-2015, subject, together with CCECC of China, established CHINA CIVIL ENGINEERING
CONSTRUCTION DANYA CEBUS JOINT VENTURE, for the sake of participation in tenders for
the construction of underground segments in the Tel Aviv underground light
train railway project. So far it won the erection of the Eastern part of the
"Red Line" segment – which includes 3 underground stations, 2
parallel tunnels of 3.5 km each + 2 connecting tunnels, and an additional
tunnel of 370 meters (valued at NIS 2.5 billion), as well as the Carlebach
Underground Station (Western Red Line) - valued at NIS 568 million.
In March 2015
subject won the tender by the ISRAEL AIRPORTS AUTHORITY to as the main
contractor for the new passenger terminal and supporting zones in the Ramon
(Timna) International Airport near Eilat, with total runways of 3.6km, expected
to be launched in 2018, with total investment of NIS 1,700 million. A delay in
the completion of the project caused subject operation losses, estimated in the
1st phase at NIS 49 million.
From the Central Bureau of Statistics (CBS)
data, investments in construction for dwelling in 2016 rose by 8.6% from the
previous year, which follows 2.2% increase in 2015 and increase of 6.4% in
2014.
Investments in construction not for dwelling
(public institutions, commercial and industrial building) rose in 2016 by 1%
(after 3.9% rise in 2015 and 3.6% in 2014), and investments in construction in
other construction works (e.g. roads, infrastructure) saw 2.1% rise in 2016,
continuing the upward trend (by 3.3%) in 2015 (after falling by 18.2% in 2014).
Gross domestic investment in buildings and
other construction works in 2016 reached NIS 130.7 billion, 5.9% increase from
2015 (rose 2.7% from 2014).
The investment included NIS 83.6 billion in
residential building, mostly for private building, the rest for public
building.
Investment in construction for non-residential building summed up to NIS
27.7 billion in 2016, while investment in other construction works was NIS 19.4
billion.
Investments in infrastructures in 2016 comprised 15.4% of total
investments in construction (NIS 25.5 billion in current prices) and remained
steady during 2015-16, after 24% decrease in 2014.
The housing prices were rising for the past years (rose by 8% in 2015)
due to high demand coupled with restricted supply, so the Government keeps
attempting to decrease prices, also by increasing the supply side and other
steps.
From the CBS data, in 2017 the volume of building starts for dwelling
(which is a dominant indicator for the trend in the building sector) amounted
to 46,320 housing units, compared with 53,950 units in 2016, 53,748 units in
2015, 47,520 in 2014, 47,747 units in 2013, and 43,452 housing units as
building starts in 2012), all well below the Government's goal for 60,000
building starts.
The number of building finishing in 2017 reached 47,449 housing units,
compared with 46,070 units finished in 2016, 43,908 units in 2015 and 44,634
housing units in 2014.
There were 112,989 dwellings under construction as of end of 2017,
compared with 114,310 dwellings in end of 2016 and 106,477 dwellings in end of
2015.
Number of dwellings transactions in 2015 reached a climax with total of
120 thousands transactions (rise in both new and second-hand apartments), but
started decreasing in 2016, due to the government's policy of tax raising. That
decreasing trend intensified into 2017. According to the review by the Chief
Economist at the Ministry of Finance, in 2017 close to 100,000 apartment were
sold, which represents estimated decrease of 11%-12% from 2016.
Investment in infrastructure in Israel in
2016 summed up at NIS 25.46 billion (in current prices), similar to the
investment rate in 2015 and 2014. The investment was divided into the transport
-roads and railways- sector (NIS 13.5 billion, 10% increase from 2015), energy
sector, water and communications.
In August 2017 the Government approved an
infrastructure development for 2017-2021 in total sum of NIS 116 billion. The
plan includes 147 projects in different sectors, notably NIS 88.4 billion in
the transportation sector (of which 15% for the light trains projects, 22%
roads, 15% railways, 8% public transportation) and NIS 19.2 billion in the
energy sector (of which 61% in electricity, 14% in water, 12% gas, 11% wastewater and 2% in fuels). 47% of
the total transportation investment already appears in the 2017-18 national
budget, and in the energy sector, 40% would come from State funding, the rest
from the private sector.
Investments in
infrastructure is financed mainly out of the State Annual Budget, and the rest
comes from the private sector (including PFI based projects).
The Ministry of Transportation development budget for investments in roads
& highways (handled by Israel's National Roads Co.), railways and public
transportation rose in the years 2005-2010 by 70%, reaching NIS 8.3 billion in
2010. In following years budget kept rising, and development budget of the
Ministry approved for 2014 summed up to NIS 12 - 13 billion (some 50% rise),
with further growth in 2015. The Ministry informed in March 2015 that they
promote transportation ventures in overall sum of over NIS 100 billion, and
annual investment of the projects reaches NIS 15 billion.
SUMMARY
On one hand
subject is profitable, and appears financially solid. On the other hand, AFRICA ISRAEL
INVESTMENTS is in financial dire straits, with a ‘going concern’ attached to
its financial reports since 2015. Considering that, and the pending legal cases
(although adequate deductions made) and pending criminal investigations
involving its subject and its CEO, it is difficult to determine credit
framework (no apparent problems for low credits, however the magnitude of
transactions and orders subject is working on are large in scope, and here it
is more problematic to estimate the risk).
FOREIGN EXCHANGE RATES
|
Currency |
Unit
|
Indian Rupees |
|
US Dollar |
1 |
INR 65.04 |
|
|
1 |
INR 92.28 |
|
Euro |
1 |
INR 80.62 |
|
ILS |
1 |
INR 18.60 |
Note :
Above are approximate rates obtained from sources believed to be correct
INFORMATION DETAILS
|
Analysis Done by
: |
NIY |
|
|
|
|
Report Prepared
by : |
TPT |
RATING EXPLANATIONS
|
Credit Rating |
Explanation |
Rating Comments |
|
A++ |
Minimum Risk |
Business dealings permissible with minimum
risk of default |
|
A+ |
Low Risk |
Business dealings permissible with low
risk of default |
|
A |
Acceptable Risk |
Business dealings permissible with
moderate risk of default |
|
B |
Medium Risk |
Business dealings permissible on a regular
monitoring basis |
|
C |
Medium High Risk |
Business dealings permissible preferably
on secured basis |
|
D |
High Risk |
Business dealing not recommended or on
secured terms only |
|
NB |
New Business |
No recommendation can be done due to
business in infancy stage |
|
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
·
Payment
record
·
Litigation
against the subject
·
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.