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Sunraj Diamond Exports Ltd.

BSE: 523425 Sector: Consumer
NSE: N.A. ISIN Code: INE459D01014
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VOLUME 100
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Buy Price 3.65
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OPEN 3.65
CLOSE 3.84
VOLUME 100
52-Week high 6.65
52-Week low 3.65
P/E
Mkt Cap.(Rs cr) 2
Buy Price 3.65
Buy Qty 100.00
Sell Price 0.00
Sell Qty 0.00

Sunraj Diamond Exports Ltd. (SUNRAJDIAMOND) - Director Report

Company director report

To

The Memberss

SUNRAJ DIAMOND EXPORTS LIMITED

Your Directors have pleasure in presenting 25th Annual Report and the Audited Statementof Accounts of your Company for the year ended 31st March 2015.

FINANCIAL RESULTS: (STANDALONE)

The salient features of the Company’s working for the year under review are asunder:

(Amount in Rs.)

Tear Ended 31.03.2015 Year Ended 31.03.2014
Sales and Other Income 223409563 401799379
Profit / (Loss) before Interest and Depreciation 12486172 16993984
Less Interest & Finance Expenses 11594255 12694107
Profit/(Loss) before Depreciation 891917 4299877
Less/Add: Depreciation 1341499 1344221
Profit/(Loss) Before Taxation (449582) 2955656
Less: Provision for Taxation (net) NIL 788000
Less: Deferred Tax 53845 168138
Profit/ (Loss) for the year (503427) 1999518
Less: Tax Adjustment relating to prior years NIL 69468
Add: Surplus brought forward from Previous year 26508061 24578011
Balance Carried to Balance Sheet 26004634 26508061

FINANCIAL RESULTS: (CONSOLIDATED)

(Amount in Rs.)

Year Ended 31.03.2015 Year Ended 31.03.2014
Sales and other Income 549781215 403518850
Profit /(Loss) before Interest and Depreciation 28752066 17952112
Less: Interest & Finance Expenses 11700371 12694107
Profit/(Loss) before Depreciation 17051695 5258005
Less: Depreciation 1341499 1344221
Profit/(Loss) Before Taxation 15710196 3931784
Less: Provision for Taxation (net) NIL 788000
Less: Deferred Tax 53845 168138
Profit/(Loss) for the year 15656351 2957646
Less: Tax Adjustment relating to prior years NIL 69468
Add: Surplus brought forward from Previous year 37974234 35086057
Balance carried to Balance Sheet 53630585 37974234

OPERATIONS:

Your Company has recorded a turnover of Rs. 2140.14 lacs during the year under reviewas opposed to Rs. 3936.48 lacs in the previous year. High raw material prices and longcredit extended to our clients have hindred aggressive sales. The company has beenconservative on its outlook and therefore has restricted turnover in order to take onminimum risk.

DIVIDEND:

With a view to conserving the resources of your company your Directors have decidednot to recommend Dividend for the year.

MATERIAL CHANGES AND COMMITMENT AFFECTING FINANCIAL POSITION OF THE COMPANY:

There are no material changes and commitments affecting the financial position of theCompany which has occurred between the end of the financial year of the Company i.e. 31March 2015 and the date of the Directors’ Report.

DIRECTORATE:

In terms of Sections 149 152 and all other applicable provisions of the Companies Act2013 for the purpose of determining the Directors liable to retire by rotation theIndependent Directors are not included in the total number of Directors of the Company.Accordingly Mr. Sunny Gandhi (holding DIN 00695322) shall retire by rotation at theensuing Annual General Meeting and being eligible has offered himself for re-appointmentas Director of the Company.

Brief profile of the Director seeking re-appointment is provided in the Noticeconvening the ensuing Annual General Meeting.

BOARD 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 the Directorsindividually including Independent Directors Board as a whole and of its variouscommittees on parameters such as skills knowledge participation in meetingscontribution towards Corporate Governance practices compliance with code of ethics etc.

Independent Directors in terms of Companies Act 2013 and Clause 49 of the ListingAgreement carried out performance evaluation of non-independent Directors Chairman ofthe Board and Board as a whole with respect to knowledge to perform the role time andlevel of participation performance of duties and level of oversight and professionalconduct and independence. The Directors expressed their satisfaction with the evaluationprocess.

MEETINGS:

During the year 9 Board Meetings were convened and held. The details thereof are givenin the Corporate Governance Report. The intervening gap between the meetings was withinthe period prescribed under the Companies Act 2013.

KEY MANAGERIAL PERSONNEL:

Mr. Sunny Gandhi and Mr. Nirav Shah were appointed Wholetime Director of the Companyand Chief Financial Officer (CFO) respectively before the Companies Act 2013 came intoforce and Mr. Nirav Shah has also been designated as Key Managerial Personnel of theCompany.

DECLARATION BY INDEPENDENT DIRECTORS:

Necessary declarations have been obtained from all the Independent Directors under sub- section (7) of Section 149 of the Companies Act 2013.

SUBSIDIARY JOINT VENTURE OR ASSOCIATE COMPANIES:

Your Company has a wholly owned foreign subsidiary Company in Dubai at the Dubai MultiCommodities Centre (DMCC) UAE in the name of SUNRAJ DIAMONDS DMCC.

Pursuant to Section 129(3) of the Companies Act 2013 read with Rule 5 of the Companies(Accounts) Rules 2014 the statement containing salient features of the Financialstatements of the Company's Subsidiaries (in Form AOC-1) is forming part of theConsolidated Financial Statement.

Pursuant to Section 136 of the Companies Act 2013 the Company is exempted fromattaching to its Annual Report the Annual Report of the Subsidiary Company viz.

SUNRAJ DIAMONDS DMCC

The financial statement of the subsidiary Company is kept open for inspection by theshareholders at the Registered Office of the Company. The Company shall provide the copyof the financial statement of its subsidiary company to the shareholders upon theirrequest free of cost.

RELATED PARTY TRANSACTIONS:

All transactions entered into with related parties as defined under the Companies Act2013 and Clause 49 of the Listing Agreement during the financial year were on an arm'slength basis and were in the ordinary course of business. There are no materiallysignificant transactions with the related parties during the financial year which were inconflict with the interest of the Company and hence enclosing of form AOC 2 is notrequired. Suitable disclosure as required by the Accounting Standard (AS-18) has been madein the notes to the Financial Statements.

Particulars of Loans Guarantees or Investments:

There were No loans guarantees or investments made by the company u/s 186 of thecompanies Act 2013 during the year under review and hence the said provision is notapplicable.

Business Risk Management

The Company manages and monitors principal risks and uncertainties that can impactability of the Company to achieve its targets / objectives. Timely reports are placedbefore the board for considering various risks involved in the Company business /operations. The Board evaluates these reports and necessary / corrective actions are themimplemented.

A brief report on risk evaluation and management is provided under Management'sDiscussion and Analysis Report forming part of this Annual Report.

Internal Financial Controls

The Company has in place adequate systems and procedures for implementation ofinternal financial control across the organization which enables the Company to ensurethat these controls are operating effectively.

Conservation of Energy Technology Absorption and Foreign Exchange Earning and Outgo

- The Company does not own any manufacturing facility and hence the particularsrelating to conservation of energy and technology absorption as stipulated in theCompanies (Accounts) Rules 2014 are not applicable. Particulars with regards to foreignexchange expenditure and earing are given in note No. 9 & 10 of the notes to theaccounts.

Corporate Social Responsibility (PSR)

The Company has not developed and implemented any Corporate Social Responsibilityinitiatives as the said provisions are not applicable.

Directors' Responsibility Statement

The Directors would like to assure the Members that the financial statements for theyear under review conform in their entirety to the requirements of the Companies Act2013. The Directors confirm that :

a) the Annual Accounts have been prepared in conformity with the applicable AccountingStandards;

b) the Accounting Policies selected and applied on a consistent basis give a true andfair view of the affairs of the Company and of the profit for the financial year;

c) sufficient care has been taken that adequate accounting records have been maintainedfor safeguarding the assets of the Company; and for prevention and detection of fraud andother irregularities;

d) the Annual Accounts have been prepared on a going concern basis;

e) the internal financial controls laid down in the Company were adequate and operatingeffectively;

f) the systems devised to ensure compliance with the provisions of all applicable lawswere adequate and operating effectively.

Share Registrar & Transfer Agent

The Company's Registrar & Transfer Agents for shares is Adroit Corporate ServicesPvt. Ltd (ACSPL). ACSPL is a SEBI registered Registrar & Transfer Agent. The contactdetails of ACSPL are mentioned in the Report on Corporate Governance. Investors arerequested to address their queries if any to ACSPL; however in case of difficulties asalways they are welcome to contact the Company's Compliance Officer the contactparticulars of which are contained in the Report on Corporate Governance.

Fixed Deposit

Your Company has not accepted any deposit from the public during the year within themeaning of Section 73 to 76 of the Companies Act 2013 read with Companies (Acceptance ofDeposits) Rules 2014.

Particulars of Employees

The Company does not have any employee covered under the provisions of Rule 5 (2) ofThe Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014 andtherefore this information has not been furnished as part of this Report.

The prescribed particulars of employees required under Rule 5(1) of the Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014 is attached'as AnnexureI and forms a part of this Report of the Directors.

Vigil Mechanism

The Company has a Vigil Mechanism and Whistle-Blower Policy to deal with instances offraud and mis-management if any and conducting business with integrity including inaccordance with all applicable laws and regulations.

Auditors

M/s Bhupendra Shroff & Co. Chartered Accountants were appointed as statutoryauditors at previous AGM to hold office till the conclusion of 27th AGM subject toratification of the appointment by the members at every AGM. In terms of Section 139 ofthe Companies Act 2013 appointment of M/s Bhupendra Shroff & Co.’ as Auditorsof the Company is recommended for ratification at the ensuing AGM.

Auditors' Report

The Auditors' Report to the shareholders does not contain any reservationqualification or adverse remark.

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 Mrs. Grishma Khandwala Practicing Company Secretary (C.P. No. 1500) toundertake the Secretarial Audit of the Company. The Secretarial Audit report for thefinancial year ended 31st March 2015 is annexed herewith as 'Annexure - II' to thisReport. The Secretarial Audit Report does not contain any reservation qualification oradverse remark.

Extract of Annual Return

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

General

Your Directors state that no disclosure or reporting ist required in respectof the following items as there were no transactions on these items during the year underreview:

a) Issue of equity shares with differential rights as to dividend voting or otherwise.

b) Issue of shares (including sweat equity shares) to employees of the Company underany scheme.

c) Neither the Managing Director nor the Whole-time Directors of the Company receiveany remuneration or commission from any of its subsidiaries.

d) No significant or material orders were passed by the Regulators or Courts orTribunals which impact the going concern status and Company’s operations in future.

e) During the year under review there were no cases filed or reported pursuant to theSexual Harassment of Women at Workplace (Prevention Prohibition and Redressal) Act 2013.

Acknowledgement

The Directors wish to take this opportunity to express their sincere thanks to theCompany’s Bankers for their valuable support and the Shareholders for theirunflinching confidence in the Company.

Corporate Governance:

A detailed report on Corporate Governance forms part of this Annual Report. TheAuditors’ Certificate on compliance with Corporate Governance requirements by theCompany is attached to the Report on Corporate Governance.

For and on behalf of the Board of Directors
SUNNY GANDHI NIRAV SHAH
Place : Mumbai Executive Director ’ Executive Director
Dated : 14th August 2.015 DIN No. 00695322 DIR No. 02033505

ANNEXURE - I

DETAILS PERTAINING TO REMUNERATION AS REQUIRED UNDER SECTION 197(12) OF THE COMPANIESACT 2013 READ WITH RULE 5(1) OF THE COMPANIES (APPOINTMENT AND REMUNERATION OF MANAGERIALPERSONNEL) RULES 2014.

(i) The percentage increase in remuneration of each Director Chief Executive Officerand Chief Financial Officer during the financial year 2014-15 ratio of the remunerationof each Director to the median remuneration of the employees of the Company for thefinancial year 2014-15 and the comparison of remuneration of each Key Managerial Personnel(KMP) against the performance of the Company are as under -

SI No. Name of Director/ KMP and Designation Remuneration of Director/KMP for financial year 2014-15 (Rs. in Lacs) % increase in Remuneration in the financial year 2014-15 Ratio of remuneration of each Director/to median remuneration of employees
2 Mr. Sunny Gandhi - ExecutiveDirector Rs. 6.50 Lacs N.A 4.16:1
3 Mr. Nirav Shah - Director (CFO) Rs. 9.75 Lacs N.A 6.25:1

* Employed for the part of the year.

(ii) The median remuneration of employees of the Company during the financial year2014-15 was Rs. 156000/-

(iii) In the financial year 2014-15 there was no increase in the median remunerationof employees.

(iv) There were 13 permanent employees on the rolls of Company as on March 31 2015.

(v) Relationship between average increase in remuneration and company performance: Therevenue from operation for the financial year ended March 31 2015 decreased by 45.63%whereas there has been no increase in median remuneration of the employees.

(vi) Comparison of remuneration of the each Key Managerial Personnel against theperformance of the Company:

Designation Percentage Increase in Remuneration of KMP Percentage Increase (Decrease) in Profit (Loss) of the Company Percentage Increase (Decrease) in Revenue from operations (Gross) of the Company
Nirav Shah - Executive Director NIL (73.92%) (45.63%)

(vii) Variations in the market capitalization of the Company price earning ratio as atthe closing date of the current financial year and previous financial year and percentageincrease or decrease in market quotation of the shares of the Company in comparison to therate at which the Company came out with the last public offer.

Name of Stock

Closing Market Price per Share (Rs.)

Percentage increase

Price Earnings Ratio

Market Capitalisation (Rs. in Lacs)

Exchange As on 31.03.2014 As on 31.03.2015 As on 31.03.2014 As on 31.03.2015 As on 31.03.2014 As on 31.03.2015
BSE Rs. 15.70 Rs. 7.53 -52.04% 43.61 -83.67 Rs. 401.38 Lacs Rs. 836.87 Lacs
NSE NA NA NA NA NA NA NA

The Company has not made any Public Issue or Rights Issue of securities in the last 10(ten) years and therefore no comparison has been made of current share price with publicoffer price*

The Company’s shares are listed on BSE Limited.

(viii) Average percentage increase made in the salaries of employees other than themanagerial personnel in the financial year 2014-15 was 4.48% whereas the increase in themanagerial remuneration for the same financial year was NIL.

(ix) There is no variable component of remuneration availed by the directors.

(x) The ratio of the remuneration of the highest paid director to that of the employeeswho are not directors but receive remuneration in excess of the highest paid directorduring the year: Not Applicable

(xi) It is hereby affirmed that the remuneration* paid during the year ended 31stMarch 2015 is as per the Remuneration Policy of the Company.

ANNEXURE - II

FORM NO. MR-3

SECRETARIAL AUDIT REPORT

For the Company's Financial Year from 1st April 2014 to 31st March 2015

[Pursuant to section 204(1) of the Companies Act 2013 and Rule No. 9 of the Companies(Appointment and Remuneration of Managerial Personnel]

To

The Members -

Sunraj Diamond Exports Limited

I have conducted the Secretarial Audit of the compliance of applicable statutoryprovisions and the adherence to good corporate practices by Sunraj Diamond ExportsLimited (hereinafter called the Company). Secretarial Audit was conducted in a mannerthat provided me a reasonable basis for evaluating the corporate conduct / statutorycompliances and expressing my opinion thereon.

Based on my verification of the books papers minute books forms and returns filedand 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 comprising the Company's Financial Year from 1st April 2014 to 31st March 2015complied with the statutory provisions listed hereunder and also that the Company hasproper Board-processes and compliance-mechanism in place to the extent in the manner andsubject to the reporting made hereinafter:

I have examined the books papers minute books forms and returns filed and otherrecords maintained by Sunraj Diamond Exports Limited for the financial year ended on 31stMarch 2015 according to the provisions of:

(i) The Companies Act 2013 (the Act) and the rules made thereunder;

(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 made thereunder to the extent of Foreign Direct Investment Overseas Direct Investment and ExternalCommercial Borrowings;

(v) The following Regulations and Guidelines prescribed under the Securities andExchange Board of India Act 1992 ('SEBI Act’):-

(a) The Securities and Exchange Board of India (Substantial Acquisition of Shares aridTakeovers) 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 - Not Applicable

(d) The Securities and Exchange Board of India (Employee Stock Option Scheme andEmployee Stock Purchase Scheme) Guidelines 1999 - Not Applicable

(e) The Securities and Exchange Board of India (Issue and Listing of Debt securities)Regulations 2008 - Not Applicable

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

(g) The Securities and Exchange Board of India (Delisting of Equity Shares)Regulations 2009 - Not Applicable

(h) The Securities and Exchange Board of India (Buy back of securities) Regulations1998 - Not Applicable

(vi) As per information provided by the management there are no laws specificallyapplicable to the company.

I have also examined compliance with the applicable clauses of the following:

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

Not Applicable

(ii) The Listing Agreements entered into by the company with BSE Limited.

During the period under review the company has complied with the provisions of the ActRules Regulations Guidelines etc mentioned above to the extent applicable

I further report that during the year under review:

The Board of Directors of the Company is duly constituted with proper balance ofExecutive Directors Non-Executive Directors and Independent Directors. There where nochanges in the composition of the Board of Directors that took place during the periodunder review.

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.

Decision at the Board Meeting were taken unanimously.

I Further Report that there are adequate systems and process in the Companycommensurate with the size and operations of the Company to monitor and ensure compliancewith applicable laws rules regulations and guidelines.

GRISHMA KHANDWALA
Company Secretary
ACS No. 6515
Mumbai 14th August 2015. C.P. No. 1500
7 Indian Mercantile Mansions
Madam Cama Road
Mumbai - 400039.

To

The Members

Sunraj Diamond Exports Limited

My 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. My responsibility is to express as opinion on these secretarial records based onmy audit.

2. I have followed the audit practices and process 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. I believe that the processes and practices I followed provide areasonable basis for my opinion.

3. I have not verified the correctness and appropriateness of financial records andBooks of Accounts of the company.

4. Where ever required I 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 is the responsibility of management. My examination was limited tothe 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.

GRISHMA KHANDWALA
Company Secretary
ACS No. 6515
Mumbai 14th August 2015. C.P. No. 1500
7 Indian Mercantile Mansions
Madam Cama Road
Mumbai - 400039.