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Lypsa Gems & Jewellery Ltd.

BSE: 534532 Sector: Consumer
NSE: LYPSAGEMS ISIN Code: INE142K01011
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OPEN 50.85
PREVIOUS CLOSE 49.40
VOLUME 60330
52-Week high 55.45
52-Week low 35.00
P/E 799.17
Mkt Cap.(Rs cr) 141
Buy Price 47.95
Buy Qty 263.00
Sell Price 0.00
Sell Qty 0.00
OPEN 50.85
CLOSE 49.40
VOLUME 60330
52-Week high 55.45
52-Week low 35.00
P/E 799.17
Mkt Cap.(Rs cr) 141
Buy Price 47.95
Buy Qty 263.00
Sell Price 0.00
Sell Qty 0.00

Lypsa Gems & Jewellery Ltd. (LYPSAGEMS) - Director Report

Company director report

To

The MembersLypsa Gems & Jewellery Ltd

The Directors' present the Annual report on the business and operations of your Companyfor the year 2014-2015.

FINANCIAL RESULTS AND OPERATIONAL REVIEW:

Year Ended 31.03.2015 Year Ended 31.03.2014
Partkulais (Rs In Lacs) (Rs In Lacs)
Gross Sales/ Income 58844.70 53490.72
Less Depreciation 36.12 21.84
Profit/ (Loss) before Tax 1968.26 1101.92
Taxes/ Deferred Taxes 179.06 156.76
Profit/ (Loss) After Taxes 1789.20 945.16
P& L Balance b/f 1507.40 672.65
Profit/ (Loss) carried to Balance Sheet 3098.06 1507.40

Your Directors feel pleasure to declare profit after tax of "1789.20 Lacs whichwas made possible through better production planning and customer relations. Directors areexploring various other opportunities to further improve the working results during thecurrent year.

DIRECTORS:

a) Mr. Jeeyan Dipankumar Patwa (DIN 02579469) Directors of the Company are liable toretire by rotation at the ensuing Annual General Meeting and being eligible offerthemselves for reappointment.

Mrs. Sonal Dipen Patwa was appointed as an Additional Director on 26th March2015during the year under review.

The Company has appointed Mr. Manish Jaysukhlal Janani as Chief Executive Officer ofthe Company and Mr. Jeeyan Dipan Patwa as Chief Financial Officer of the Company w.e.f.10/06/2015.

The Company has formulated a policy on directors appointment & remunerationincluding criteria for determining qualifications positive attributes independence ofdirector & other matters as provided under section 178(3) of the Companies Act2013& such policy is annexed with the Director Report.

The details of familiarization programme for Independent Directors have been disclosedon website of the Company.

Pursuant to the provisions of the Companies act 2013and Clause 49 of the ListingAgreement evaluation of every Directors performance was done by the Nomination andRemuneration Committee. The performance evaluation of the Non - Independent Directors andthe Board as a whole committees thereof and the chair person of the company was carriedout by the Independent Directors. Evaluation of the Independent Directors was carried outby the entire Board of Directors excluding the Directors being evaluated. A structuredquestionnaire was prepared after circulating the draft norms covering various aspects ofthe evaluation such as adequacy of the size and composition of the Board and Committeethereof with regard to skill experience independence diversity attendance and adequacyof time given by the directors to discharge their duties Corporate Governance practicesetc. The Directors expressed their satisfaction with the evaluation process.

The following policies of the company are attached herewith and marked as Annexure AAnnexure B and Annexure C.

Policy on appointment of Directors and Senior Management (Annexure A)

Policy on Remuneration to Directors' (Annexure B)

Policy on Remuneration of Key Managerial Personnel and Employees (Annexure C)

b) Declaration by an Independent Director(s) and reappointment if any

All Independent Directors have given declarations that they meet the criteria ofindependence as laid down under Section 149(6) of the Companies Act 2013and Clause 49 ofthe Listing Agreement.

c) Formal Annual Evaluation

Pursuant to the provisions of the Companies Act 2013 and Clause 49 of the ListingAgreement the Board has carried out an annual performance evaluation of its ownperformance the directors individually as well as the evaluation of the working of itsAudit Nomination and Remuneration Committees. The manner in which the evaluation has beencarried out has been explained in the Corporate Governance Report.

d) Remuneration Policy

The Board hason the recommendation of the Nomination & Remuneration Committeeframed a policy for selection and appointment of Directors Senior Management and theirremuneration. The Remuneration Policy is stated in the Corporate Governance Report.

e) Number of Meetings of the Board of Directors and Audit Committee

A calendar of Meetings is prepared and circulated in advance to the Directors.

During the year Eleven Board Meetings and one Independent Directors' meeting and fourAudit Committee Meetings were convened and held. The details of which are given in theCorporate Governance Report. The intervening gap between the Meetings was within theperiod prescribed under the Companies Act 2013.

DIVIDEND:

The Board of Directors has recommend 3.5% dividend i.e. Rs. 0.35 per share on21060000 Equity Shares of Rs. 10/- each for the year ended 31-03-2015. The dividendwill entail an outflow of Rs. 8845200.00 (Including dividend distribution tax of Rs.1474200.00). The payment of dividend is subject to the approval of the Members at theensuing General Meeting of the Company and Record Date for this purpose 25th September2015 to 26th September 2015and no interim dividend was paid during the year.

NATURE OF BUSINESS

The Company is engaged in the business of trading import export making and polishingactivities of diamonds gems and other precious stones.

There was no change in the nature of the business of the Company during the year underreview.

REPORT ON PERFORMANCE AND FINANCIAL POSITION OF SUBSIDIARIES ASSOCIATES AND JOINTVENTURE COMPANIES

The Company has 100% foreign subsidiary named Lypsa Gems and Jewellery DMCCincorporated in U.A.E. The company has earned a net profit of Rs. 143528525/- (P.Y. Rs.63039333/-)

TRANSFER TO RESERVES

Out of the profits available for appropriation no amount has been transferred to theGeneral Reserve and the balance amount of Rs. 3098.06 lacs has been carried forward toprofit & loss account.

SHARE CAPITAL

The paid up Equity Share Capital as on March 31 2015 was Rs. 21.06 Crores.

The Company has allotted 7020000 Equity Shares of Rs. 10/- each on 01/10/2014 throughBonus issue in proportion of 1 (One) Equity Share for every 2 (Two)equity shares held bysuch persons on the Record Date during the year under review.

A) Issue of equity shares with differential rights:

During the year under review the Company has not issued any shares with differentialvoting rights.

B) Issue of sweat equity shares

During the year under review the Company has not issued any sweat equity shares.

C) Issue of employee stock options

During the year under review the Company has not issued any sweat equity shares.

D) Provision of money by company for purchase of its own shares by employees or bytrustees for the benefit of employees The Company has no scheme of provision of money forpurchase of its own shares by employees or by trustees for the benefit of employees. Hencethe details under rule 16 (4) of Companies (Share Capital and Debentures) Rules 2014 arenot required to be disclosed.

FINANCE

The Company has repaid the installments of Term Loans amounting to Rs. 35.50 Lacsduring the current year.

The Company has also made fresh borrowings of Rs. 50.00 Lacs for funding capitalexpenditure and other requirements.

FIXED DEPOSITS

The Company has not accepted or renewed any deposits during the year. There are nooutstanding and overdue deposits as at 31st March 2015.

PARTICULARS OF LOANS GUARANTEES OR INVESTMENTS UNDER SECTION 186

Details of Loans Guarantees and Investments covered under the provisions of Section186 of the Companies Act 2013 are given in the notes to the Financial Statements.

CORPORATE SOCIAL RESPONSIBILITY

Every year 5th June is observed as the World Environment Day around the world and is ofimmense importance for the Lypsa Group. In the year 2014-15 one specific area was relatedto our work. Sustainability is a complex concept incorporating a wide range of socialenvironmental and economic issues. We recognize the holistic nature of a sustainableapproach. As such this commitment is as much about our Trading and Manufacturing ofdiamonds and business operations as it is about our people the communities where we workour suppliers and partners and the clients we work with. This is our commitment to manageour activities business processes and supply chain safely and in ways that minimizeadverse environmental and social impacts.

This is a commitment to safeguard the health and safety of our employees andneighbors' to support the local economy and to treat our staff fairly. It is aboutcreating wealth for all our stakeholders embracing diversity minimizing resourceconsumption and reducing our greenhouse gas emissions.

However we recognize that we •will have to be innovative and draw on our keystrength - our motivated staff - in order to deliver the lasting positive outcomes thatare at the core of our commitment to sustainability.

BUSINESS RISK MANAGEMENT

The Company has laid down a Risk Management Policy and identified threat of such eventswhich if occurs will adversely affect either / or value to shareholders ability ofcompany to achieve objectives ability to implement business strategies the manner inwhich the company operates and reputation as "Risks". Further such Risks arecategorized in to Strategic Risks Operating Risks & Regulatory Risks. A detailedexercise is carried out to identify evaluate manage and monitoring all the three typesof risks.

INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY

The Company has an Internal Control System commensurate with the size scale andcomplexity of its operations. During the year under review the company retained externalaudit firm to review its existing internal control system with a view of tighten the sameand introduce system of self certification by all the process owners to ensure thatinternal controls over all the key business processes are operative. The scope andauthority of the Internal Audit (IA) function is defined in the Internal Audit Charter.

The Internal Audit Department monitors and evaluates the efficacy and adequacy ofinternal control system in the Company its compliance with operating systems accountingprocedures and policies at all locations of the Company and its subsidiaries. Based on thereport of internal audit function process owners undertake corrective action in theirrespective areas and thereby strengthen the controls. Significant audit observations andcorrective actions thereon are presented to the Audit Committee of the Board.

VIGIL MECHANISM/WHISTLE BLOWER POLICY

The Company has a vigil mechanism named Whistle Blower Policy to deal with instances offraud and mismanagement if any. The details of the Whistle Blower Policy is explained inthe Corporate Governance Report and also posted on the website of the Company.

DIRECTORS' RESPONSIBILITY STATEMENT

To the best of their knowledge and belief and according to the information andexplanations obtained by them your Directors make the following statements in terms ofSection 134(3)(c) of the Companies Act 2013: a. that in the preparation of the annualfinancial statements for the year ended March 31 2015 the applicable accountingstandards have been followed along with proper explanation relating to materialdepartures if any; b. that such accounting policies have been selected and appliedconsistently and judgment and estimates have been made that are reasonable and prudent soas to give a true and fair view of the state of affairs of the Company as at March 312015 and of the profit of the Company for the year ended on that date; c. that proper andsufficient care has been taken for the maintenance of adequate accounting records inaccordance with the provisions of the Companies Act 2013 for safeguarding the assets ofthe Company and for preventing and detecting fraud and other irregularities; d. that theannual financial statements have been prepared on a going concern basis e. that properinternal financial controls were in place and that the financial controls were adequateand were operating effectively;

.f that systems to ensure compliance with the provisions of all applicable laws were inplace and were adequate and operating effectively.

RELATED PARTY TRANSACTIONS

There is no transaction with Related Party which requires disclosure under Section134(3)(h) of the Companies Act2013 and Rule 8(2)of the Companies (Accounts) Rules2014.The policy on materiality of related party transactions and also on dealing withrelated party transactions as approved by the Board may be accessed on the Companywebsite.

SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS

There are no significant material orders passed by the Regulators / Courts which wouldimpact the going concern status of the Company and its future operations.

AUDITORS

A. Statutory Auditors

The Company's Auditors M/s. Doshi Maru & Associates Mumbai who retire at theensuing Annual General Meeting of the Company are eligible for reappointment. They haveconfirmed their eligibility under Section 141 of the Companies Act 2013 and the Rulesframed thereunder for reappointment as Auditors of the Company. As required under Clause49 of the Listing Agreement the auditors have also confirmed that they hold a validcertificate issued by the Peer Review Board of the Institute of Chartered Accountants ofIndia.

B. Secretarial Audit

Pursuant to the provisions of Section 204 of the Companies Act 2013 and The Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014 the Company hasappointed CS Rupal Patel Practicing Company Secretary to undertake the Secretarial Auditof the Company. The Secretarial Audit Report is annexed herewith as "Annexure-D".

CORPORATE GOVERNANCE REPORT AND MANAGEMENT DISCUSSION & ANALYSIS

Your Company is committed to the tenets of good Corporate Governance and has takenadequate steps to ensure that the requirements of Corporate Governance as laid down inClause 49 of the Listing Agreement are complied with.

As per Clause 49 of the Listing Agreement with the Stock Exchanges the CorporateGovernance Report Management Discussion and Analysis and the Auditor's Certificateregarding compliance of conditions of Corporate Governance are attached separately andform part of the Annual Report.

CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE:

The information on conservation of energy technology absorption and foreign exchangeearnings and outgo stipulated under Section 134(3)(m) of the Companies Act 2013 read withRule 8 of The Companies (Accounts) Rules 2014 is annexed herewith as"Annexure-E".

EXTRACT OF THE ANNUAL RETURN

The details forming part of the extract of the Annual Return in form MGT-9 is annexedherewith as "Annexure-F".

PARTICULARS OF EMPLOYEES

None of the employees of the Company is in receipt of remuneration prescribed underSection 197(12) of the Companies Act 2013 read with the Companies (Particulars ofEmployees) Rules 1975. Thus furnishing of particulars under the Companies (Particulars ofEmployees) Rules 1975 does not arise.

DISCLOSURE AS PER SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION PROHIBITION ANDREDRESSAL) ACT 2013

A copy of audited financial statements of the said Companies will be made available tothe members of the Company seeking such information at any point of time. A cash flowstatement for the year 2014-2015 is attached to the Balance Sheet. Pursuant to thelegislation 'Prevention Prohibition and Redressal of Sexual Harassment of Women atWorkplace Act 2013' introduced by the Government of India the Company has a policy onPrevention of Sexual Harassment at workplace. There was no case reported during the yearunder review under the said policy.

PRESENTATION OF FINANCIAL STATEMENTS

The financial statements of the Company for the year ended 31st March 2015 have beendisclosed as per Schedule III to the Companies Act2013.

ACKNOWLEDGEMENT

Yours Directors take this opportunity to thank the Financial Institutions BanksBusiness Associates Central and State Government authorities Regulatory authoritiesStock Exchanges and all the various stakeholders for their continued co-operation andsupport to the Company and look forward to their continued support in future.

We very warmly thank all of our employees for their contribution to your Company'sperformance. We applaud them for their superior levels of competence dedication andcommitment to your Company.

For Lypsa Gems & Jewellery Ltd
Date: 28/08/2015
Place: Navsari
SD/- SD/ - SD/ -
(Manish Janani) (Dipan Patwa) (Jeeyan Patwa)
Managing Director Chairman Director
(DIN: 02579381) (DIN: 2579405) (DIN: 02579469)

ANNEXURE -A TO THE DIRECTORS' REPORT FOR THE YEAR 2014-2015

POLICY ON APPOINTMENT OF DIRECTORS AND SENIOR MANAGEMENT

I. APPOINTMENT OF DIRECTORS

The Nomination and Remuneration Committee (NRC) of the Board of Directors (Board) ofthe Company reviews and assesses Board composition and recommends the appointment of newDirectors. In evaluating the suitability of individual Board member the NRC shall takeinto account the following criteria regarding qualifications positive attributes and alsoindependence of director when Independent Director is to be appointed:

1. All Board appointments will be based on merit in the context of the skillsexperience diversity and knowledge for the Board as a whole to be effective;

2. Ability of the candidates to devote sufficient time and attention to his/herprofessional obligations as Director for informed and balanced decision making.

3. Adherence to the applicable Code of Conduct and highest level of CorporateGovernance in letter and i n sprit by the Directors.

Based on the recommendations of the NRC the board will evaluate the candidates anddecide on the selection the appropriate member. The Board through the Chairman or theManaging Director & CEO will interact with the new member to obtain his/her consentfor joining the Board. Upon receipt of the consent the new Director will be co-opted bythe Board in accordance with the applicable provisions of the Companies Act 2013 andRules made there under.

REMOVAL OF DIRECTORS:

If a Director is attracted with any disqualification as mentioned in any of theapplicable Act rules and regulations there under or due to non - adherence to theapplicable policies of the Company the NRC may recommend to the Board with reasonsrecorded in writing removal of a Director subject to the compliance of the applicablestatutory provisions

SENIOR MANAGEMENT PERSONNEL:

The NRCshall identify persons based on mere it experience and knowledge who may beappointed in senior management team.

Senior Management personnel are appointed or promoted and removed/relieved with theauthority of

Managing Director & CEO based on the business need and the suitability of thecandidate. The details of the appointment made and the personnel removed one level belowthe Key Managerial Personnel during a quarter shall be presented to the Board.

For Lypsa Gems & Jewellery Ltd
Date: 28/08/2015
Place: Navsari
SD/- SD/ - SD/ -
(Manish Janani) (Dipan Patwa) (Jeeyan Patwa)
Managing Director Chairman Director
(DIN: 02579381) (DIN : 2579405) (DIN: 02579469)

If a MD & CEO draws or receives directly or indirectly by way of remuneration anysuch sums in excess of the limits prescribed under the Companies Act 2013 or without theprior sanction of the Central Government where required he / she shall refund such sumsto the Company and until such sum is refunded hold it in trust for the Company. TheCompany shall not waive recover y of such sum refundable to it unless permitted by theCentral Government of the Company.

Remuneration for MD & CEO is designed subject to the limits laid down under theCompanies Act 2013 o t remunerate him / her fairly and responsibly. The remuneration tothe MD & CEO comprises of salary perquisites and benefits as per policy of theCompany and performance based incentive apart from retirement benefits like P.P.Superannuation Gratuity Leave Encashment etc. as per Rules Salary i s paid within therange approved by the Shareholders. Increments are effective annually as recommended/approved by the NRC / Board. The MD & CEO is entitled for grant of Stock Options asper the approved Stock Options Schemes of the Company from time to time

Directors

The MD & CEO is an executive of the Company and draws remuneration from theCompany. The Non-Executive Independent Directors receive sitting fees for attending themeeting of the Board and Committee thereof as fixed by the Board of Directors from timeto time subject to statutory provisions. The Non-Executive Independent Directors would beentitled to the remuneration under the Companies Act 2013.In addition to the above theDirectors are entitled for reimbursement of expenses incurred in discharge of theirduties.

The Company may also grant Stock Options to the eligible employees and Directors (otherthan Independent Directors) in accordance with the ESOP Schemes of the Company from timeto time and subject to the compliance statutes and regulations.

Disclosures

Information on the total remuneration of members of the Company's Board of DirectorsManaging Director and Executive Directors and KMP/senior management personnel may bedisclosed in the Board's report and the Company's annual report / website as per statutoryrequirements in this regard.

For Lypsa Gems & Jewellery Ltd
Date: 28/08/2015
Place: Navsari
SD/- SD/ - SD/ -
(Manish Janani) (Dipan Patwa) (Jeeyan Patwa)
Managing Director Chairman Director
(DIN: 02579381) (DIN :2579405) (DIN : 02579469)

ANNEXURE - C TO THE DIRECTORS REPORT FOR THE YEAR ENDED 31ST MARCH 2015:

POLICY ON REMUNERATION OF KEYMANAGERIAL PERSONNEL AND EMPLOYEES

This policy shall be effective from the financial year 2014-15.

OBJECTIVE:

To establish guidelines for remunerating employees fairly and in keeping with Statutes.

STANDARDS

1. All employees irrespective of contract are to be paid remuneration fairly and theremuneration is to be externally competitive and internally equitable. The remunerationwill be paid in accordance with the laid down Statutes.

2. Remuneration for on-roll employees will include a fixed or guaranteed componentpayable monthly; and a variable component which is based on performance and paid annually.

3. The fixed component of remuneration will have a flexible component with a bouquet ofallowances to enable an employee to choose the allowances as well as the quantum based onlaid down limits as per Company policy. The flexible component can be varied only onceannually in the month of July after the salary increment exercise.

4. The variable component of the remuneration will be a function of the employee'sgrade.

5. The actual pay-out of variable component of the remuneration will be function ofindividual performance as well as business performance. Business performance is evaluatedusing a Balance Score Card (BSC) while individual performance is evaluated on Key ResultAreas (KRA). Both the BSC & KRAs are evaluated at the end of the fiscal to arrive atthe BSC rating of the business and PPS rating of the individual.

6. An Annual compensation survey is carried out to ensure that the Company'scompensation is externally competitive. Based on the findings of the survey and thebusiness performance the committee decides: (i) Th e increment that needs to be paid fordifferent performance ratings as well as grades. (ii) The increment for promotions and thetotal maximum increment

(iii) The maximum increase in compensation cost in %and absolute.

(iv) Compensation corrections are made in a few cases where it is outside the band orto keep i t tune with the market.

For Lypsa Gems & Jewellery Ltd

Date: 28/08/2015
Place: Navsari
SD/- SD/ - SD/ -
(Manish Janani) (Dipan Patwa) (Jeeyan Patwa)
Managing Director Chairman Director
(DIN: 02579381) (DIN: 2579405) (DIN: 02579469)

ANNEXURE - D SECRETARIAL AUDIT REPORT

FOR THE FINANCIAL YEAR ENDED 31stMarch 2015

[Pursuant to section 204(1) of the Companies Act2013and rule No.9of the Companies(Appointment and Remuneration Personnel) Rules 2014]

To

The Members

Lypsa Gems & Jewellery Limited

(CIN: L28990GJ1995PLC028270)

2nd Floor Diamond Park Building Opp. Ambika Nagar Society

Dargah Road Navsari - 396445

I have conducted the secretarial audit of the compliance of applicable statutoryprovisions and the adherence to good corporate practices by Lypsa Gems & JewelleryLimited (hereinafter called "the company") for the audit period covering thefinancial year ended on 31st March 2015. Secretarial Audit was conducted in a manner thatprovided me a reasonable basis for evaluating the corporate conducts/statutory compliancesand expressing my opinion thereon.

Based on my verification of company's books papers minute books forms and returnsfiled and other records maintained by the company and also the information provided by theCompany its officers agents and authorized representatives during the conduct ofsecretarial audit I hereby report that in my opinion the company has during the auditperiod covering the financial year ended on 31st March 2015 complied with the statutoryprovisions listed hereunder and also that the Company has proper Board-processes andcompliance-mechanism in place to the extent in the manner and subject to the reportingmade hereinafter:

1.I have examined the books papers minute books forms and returns filed and otherrecords maintained by the Company for the financial year ended on 31stMarch 2015according to the provisions of:

(i) The Companies Act2013 (theAct) and the rules made there under for specifiedsections notified and came into effect from 12thSeptember 2013 and sections and Rulesnotified and came into effect from 1st April 2014;

(ii) The Securities Contracts (Regulation) Act 1956 ('SCRA') and the rules madethereunder;

(iii) The Depositories Act 1996 and the Regulations and Bye-laws framed thereunder;

(iv) Foreign Exchange Management Act 1999 and the rules and regulations madethereunder to the extent of Foreign Direct Investment Overseas Direct Investment andExternal Commercial Borrowings;

(v)The following Regulations and Guidelines prescribed under the Securities andExchange Board of India Act1992 ('SEBI Act'):-

(a) The Securities and Exchange Board of India (Substantial Acquisition of Shares andTakeovers) Regulations 2011;

(b) The Securities and Exchange Board of India (Prohibition of Insider Trading)Regulations 1992;

(c) The Securities and Exchange Board of India (Issue of Capital and DisclosureRequirements) Regulations 2009;

(d) The Securities and Exchange Board of India (Registrars to an Issue and ShareTransfer Agents) Regulations 1993 regarding the Companies Act and dealing with client;

I hav e also examined compliance of the following to the extent applicable:

(i) Secretarial Standards issued by The Institute of Company Secretaries of India.

(ii) The Listing Agreements entered into by the Company with Bombay Stock Exchange; Ihave relied upon the representation made by the Company and its Officers for systems andmechanism formed by the Company for compliances under applicable Acts Laws andRegulations to the Company.

On the basis of our examination and representation made by the Company we report thatduring the period under review the Company has generally complied with the provisions ofthe Act Rules Regulations Guidelines etc.mentioned above and there are no materialnon-compliances that have come to our knowledge except non compliance in respect of: a)Non filing/serving of notice for trading window closure as required under clause 3.2.1 ofthe Securities and Exchange Board of India (Prohibition of Insider Trading) Regulations1992 during the year under review. The Company has informed BSE that the Company hascomplied the requirement of the regulation 8 (Code of Fair Disclosure) and regulation 9(Code of Conduct) of the SEBI (Prohibition of Insider Trading) Regulation 2015 on 15*May 2015. b) During the year under review the Company has not appointed Chief FinancialOfficer of the Company as a KMP as required under section 203 read with the Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014. And the company hasappointed the same on 10thJune 2015.

We Further Report that there were no actions/ events in pursuance of:

a) The Securities and Exchange Board of India (Issue and Listing of Debt Securities)Regulations 2008;

b) The Securities and Exchange Board of India (Delisting of Equity Shares) Regulations2009;

c) The Securities and Exchange Board of India (Buyback of Securities) Regulations1998;

d) The Securities and Exchange Board of India (Employee Stock Option Scheme andEmployee Stock Purchase Scheme) Guidelines 1999 and The Securities and Exchange Board ofIndia (Share Based Employee Benefits) Regulations 2014 notified on 28 October 2014Requiring compliance thereof by the Company during the period under review I furtherreport that The Board of Directors of the Company is duly constituted with proper balanceof Executive Directors Non-Executive Directors and Independent Directors. The changes inthe composition of the Board of Directors that took place during the period under reviewwere carried out in compliance with the provisions of the Act.

Adequate notice is given to all directors to schedule the Board Meetings agenda anddetailed notes on agenda were sent at least seven days in advance and a system exists forseeking and obtaining further information and clarifications on the agenda items beforethe meeting and for meaningful participation at the meeting.

Decisions at the meetings of the Board of Directors of the Company were carried throughon the basis of majority. There were no dissenting views by any member of the Board ofDirectors during the period under review.

I further report that there are adequate systems and processes in the companycommensurate with the size and operations of the company to monitor and ensure compliancewith applicable laws rules regulations and guidelines.

I further report that during the audit period there were no specific events / actionshaving a major bearing on the company's affairs except the following: a) The Company hasallotted 7020000 Equity Shares of Rs. 10/- each on 01/10/2014 through Bonus issue inproportion of 1 (One) Equity Share for every 2 (Two )equity shares held by such persons onthe Record Date during the year under review.

Date : 28/08/2015 Signature : Sd/ -
Place : Ahmedabad Name of Practicing Company Secretary: Rupal Patel
C. P. No.: 3803
PCS No.: 6275

Annexure I

To

The Members

Lypsa Gems & Jewellery Limited

(CIN: L28990GJ1995PLC028270)

2nd Floor Diamond Park Building Opp. Ambika Nagar Society

Dargah Road Navsari - 396445

Our report of even date is to be read along with this letter:

1. Maintenance of secretarial record is the responsibility of the management of theCompany. Our responsibility is to express an opinion on these secretarial records based onour audit.

2. We have followed the audit practices and processes as were appropriate to obtainreasonable assurance about the correctness of the contents of the secretarial records. Theverification was done on test basis to ensure that correct facts are reflected insecretarial records. We believe that the processes and practices we followed provide areasonable basis for our opinion.

3. We have not verified the correctness and appropriateness of financial records andBooks of Accounts of the Company.

4. Wherever required we have obtained the Management representation about thecompliance of laws rules and regulations and happening of events etc.

5. The compliance of the provisions of corporate and other applicable laws rulesregulations standards s i the responsibility of management. Our examination was limitedto the verification of procedures on test basis.

6. The secretarial audit report is neither an assurance as to the future viability ofthe Company nor of the efficacy or effectiveness with which the management has conductedthe affairs of the Company.

Date: 28/08/2015 Signature : Sd/ -
Place: Ahmedabad Name of Practicing Company Secretary: Rupal Patel
C. P. No.: 3803
PCS No.: 6275

ANNEXURE - E TO THE DIRECTORS' REPORT FOR THE YEAR 2014-2015

Information on Conservation of Energy Technology Absorption and Foreign ExchangeEarnings and Outgo stipulated under Section 134(3)(m) of the Companies Act 2013 read withRule 8 of The Companies (Accounts) Rules 2014.

a) Conservation of energy

(i) the steps taken or impact on conservation of energy Nil
(ii) the steps taken by the company for utilizing alternate sources of energy Nil
(iii) the capital investment on energy conservation equipment's Nil

(b) Technology absorption

(i) the efforts made towards technology absorption Nil

(ii) the benefits derived like product improvement cost Nil reduction productdevelopment or import substitution

(iii) in case of imported technology (imported during the last Nil three years reckonedfrom the beginning of the financial year)-(a) the details of technology imported Nil

(b) the year of import; Nil

(c) whether the technology been fully absorbed Nil

(d) if not fully absorbed areas where absorption has not Nil taken place and thereasons thereof

(iv) the expenditure incurred on Research and Development Nil

(c) Foreign exchange earnings and Outgo

During the year the total foreign exchange used was Rs. 1142.37 Lakh and the totalforeign exchange earned was Rs. 562.84 Lakh.