ANNUAL REPORT - 2001
SHRENUJ & COMPANY LIMITED
It gives me great pleasure to welcome you to this Nineteenth Annual General
Last year was one of mixed fortunes for your Company. Diamond sales did
well despite recessionary conditions in some of our major markets. However,
jewellery sales were not very encouraging.
Given this background, it is gratifying that your Company has been able to
record growth of 22% in turnover in face of severe competition and overall
slowdown in global demand for gems & jewellery, in most of our major
overseas markets. Profit before interest, depreciation and tax was higher
by 40.7% at Rs. 19.05 crores against Rs. 13.54 crores last year. However,
due to interest cost having more than doubled to Rs. 10.78 crores from Rs.
5.11 crores and higher provision for depreciation and taxation, profit
after taxation declined from Rs. 7.80 crores to Rs. 7.13 crores.
As far as Indian economy is concerned, the year 2000-2001 ended on a
disappointing note, with deceleration in GDP growth to 5.2% from 6.4% in
the previous year. The devasting earthquake in Gujarat in January, 2001
also cast a gloom on the entire country and economy. As a part of social
obligation towards rehabilitation of the victims of this terrible tragedy,
the company and its employees contributed Rs. 12.52 lacs to the Gujarat
Earthquake Relief Fund through the Gems & Jewellery National Relief
Foundation and Janmabhoomi Patro Rahat Niadhi.
Your Company has been convinced of the need for good Corporate Governance
and set up Audit Committee and Shareholders/Investors Grievance Committee
in April 2000, although the relevant SEBI guidelines in this regard were to
be complied with only by 31st March, 2002. A Remuneration Committee has
also been formed in May, 2001.
The foresight and pioneering spirit of your Company in introducing laser
technology in the Indian diamond industry has resulted in considerable
saving in costs and improved productivity. The management is continuously
striving to bring about more production-oriented changes in the process of
polishing diamonds, especially the premium ones. With this end in view, the
company is currently implementing a project with state of the art equipment
and employing modern techniques which will result in significant value
addition and better yields. The project is expected to be commissioned
during the first quarter of 2002. To achieve the desired results, we have
already set up two pilot projects to test the equipment and proposed
techniques and systems and I am glad to inform you that the results so far
are very encouraging. I expect that this will have a positive impact on our
bottom line next year.
We have started the current year on a good note despite very tough market
conditions. The goodwill we enjoy among our patrons combined with our
strenuous efforts to offer more appealing and higher value gems and
jewellery should enable us to fare well during the current year.
During the year Shri Raj Kumar Talwar, Shri Prakash S. Doshi and Smt. Geeta
S. Doshi resigned from the Board. I would like to sincerely thank them for
their valuable advice during their long association with the Company. I
welcome Shri Pinakin D. Desai, eminent Chartered Accountant, who has
recently joined our Board. I am sure, the Board will benefit from his
acumen and experience.
In our efforts to steer the Company forward, we have had the unstinted co-
operation of all our employees to whom I extend the warm appreciation of
the Board and my own. I am also grateful to my colleagues on the Board for
their mature counsel and to our Bankers and customers for their continuing
support. The Diamond Trading Company has at all times evinced keen interest
in our growth and development and we express our gratitude to them.
You, our shareholders, have been a source of great support and
encouragement to us and it will be our endeavour to ensure that you are
suitably rewarded in years to come.
Kirtilal K. Doshi
Place : Mumbai
Date : 8th August, 2001