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Lypsa Gems & Jewellery Ltd.

BSE: 534532 Sector: Consumer
NSE: LYPSAGEMS ISIN Code: INE142K01011
BSE 00:00 | 23 Jul 11.55 0.13
(1.14%)
OPEN

11.75

HIGH

11.80

LOW

11.25

NSE 00:00 | 23 Jul 11.70 0.05
(0.43%)
OPEN

11.75

HIGH

11.90

LOW

11.00

OPEN 11.75
PREVIOUS CLOSE 11.42
VOLUME 19587
52-Week high 55.45
52-Week low 10.89
P/E 165.00
Mkt Cap.(Rs cr) 34
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00
OPEN 11.75
CLOSE 11.42
VOLUME 19587
52-Week high 55.45
52-Week low 10.89
P/E 165.00
Mkt Cap.(Rs cr) 34
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00

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

Company director report

To

The Members

Lypsa Gems & Jewellery Ltd

The Directors’ present the Annual report on the business and operations of yourCompany for the year 2016-2017.

FINANCIAL RESULTS AND OPERATIONAL REVIEW:

Particulars Year Ended 31.03.2017 Year Ended 31.03.2016
(Rs In Lacs) (Rs In Lacs)
Gross Sales/Income 7659.36 20612.94
Less Depreciation 43.17 46.86
Profit/(Loss) before Tax 16.61 178.05
Taxes Deferred Taxes 3.29 58.84
Profit/(Loss) After Taxes 13.32 119.21
P& L Balance b/f 1027.86 907.68
Profit/ (Loss) carried to Balance Sheet 1033.20 1027.86

Your Directors feel pleasure to declare profit after tax of `13.32 Lacs which was madepossible 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 Patwa (DIN 02579469) Director of the Company are liable to retire byrotation at the ensuing Annual General Meeting and being eligible offer themselves forre-appointment.

During the year under review the company accepted resignation of Mr. Pankajkumar Shahfrom the directorship of the company w.e.f. 12.08.2016 and appointed Mr. Rakesh Vakhariaas an Additional Director of the Company on 12.08.2016.

During the year under review the company accepted resignation of Mr. Ajit Shah fromthe directorship of the company w.e.f. 11.11.2016 and appointed Mr. Deepak Rathod as anAdditional Director of the Company on 11.11.2016.

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 2013 and SEBI(Listing Obligations and Disclosure Requirements) Regulations 2015.

c) Formal Annual Evaluation

Pursuant to the provisions of the Companies Act 2013 and SEBI (Listing Obligations andDisclosure Requirements) Regulations 2015 the Board has carried out an annualperformance evaluation of its own performance the directors individually as well as theevaluation of the working of its Audit Nomination and Remuneration Committees. The mannerin which the evaluation has been carried out has been explained in the CorporateGovernance Report.

d) Remuneration Policy

The Board has on 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 Sixteen Board Meetings and one Independent Directors’ meeting andfour Audit Committee Meetings were convened and held. The details of which are given inthe Corporate Governance Report. The intervening gap between the Meetings was within theperiod prescribed under the Companies Act 2013.

DIVIDEND:

Since the Company has not made sufficient profit the directors are unable to recommendany dividend during the year under review.

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% Subsidiary "Lypsa Gems & Jewellery DMCC ( entitiestogether termed as the Lypsa Group) in Dubai. Hence details for the same are not requiredto mention here.

TRANSFER TO RESERVES

The company has not transferred any amount to General Reserve. However credit balanceof Profit and Loss Account amounting to Rs. 13.32 Lacs is transferred to Surplus.

SHARE CAPITAL

The paid up Equity Share Capital as on March 31 2017 was Rs. 21.06 Crores.

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 for purchase of its own shares byemployees or by trustees for the benefit of employees. Hence the details under rule 16 (4)of Companies (Share Capital and Debentures) Rules 2014 are not required to be disclosed.

FINANCE

The Company has not obtained any term loan during the year.

The Company has also made fresh borrowings of Rs.6.32 Lacs for funding capitalexpenditure and other requirements. Long Term Debt of the Company stands to Rs. 23.96Crores as on 31st March 2017.

FIXED DEPOSITS

The Company has not accepted or renewed any deposits during the year. There are nooutstanding and overdue deposits as at 31st March 2017.

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.

DETAILS IN RESPECT OF ADEQUACY OF INTERNAL FINANCIAL CONTROLS WITH REFERENCE TO THEFINANCIAL STATEMENTS

The Company has adequate of internal financial controls with reference to the FinancialStatements during the year under review.

CORPORATE SOCIAL RESPONSIBILITY

The Company does not fall under the ambit of Section 135 of Companies Act 2013relating to Corporate Social Responsibility. However every year 5th June isobserved as the World Environment Day around the world and is of immense importance forthe Lypsa Group. In the year 2016-17 one specific area was related to our work.Sustainability is a complex concept incorporating a wide range of social environmentaland economic issues. We recognize the holistic nature of a sustainable approach. As suchthis commitment is as much about our Trading and Manufacturing of diamonds and businessoperations as it is about our people the communities where we work our suppliers andpartners and the clients we work with. This is our commitment to manage our activitiesbusiness processes and supply chain safely and in ways that minimize adverse environmentaland 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 key strength -our motivated staff - in order to deliver the lasting positive outcomes that are at thecore of our commitment to sustainability.

BUSINESS RISK MANAGEMENT

Risk management is embedded in your company’s operating framework. Your companybelieves that managing risk helps in maximizing returns. The company’s approach toaddressing business risk is comprehensive and includes periodic review of such risks and aframework for mitigating controls and reporting mechanism of such risks. The riskmanagement framework is reviewed periodically by the Board and the Audit Committee. Someof the risks that the company is exposed to are:

Commodity Price Risks

The Company is exposed to the risk of price fluctuation of raw material as well asfinished goods. The company proactively manages these risks through forward bookingInventory management and proactive vendor development practices. The Company’sreputation for quality product differentiation and service coupled with existence ofpowerful brand image with robust marketing network mitigation the impact the impact ofprice risk on finished goods.

Regulatory Risks

The company is exposed to risks attached to various statues and regulations includingthe company Act. The company is mitigating these risks through regular review of legalcompliances carried out through internal as well as external compliance audits.

Human Resources Risks

Retaining the existing talent pool and attracting new talent are major risks. Thecompany has initialed various measures including rolling out strategic talent managementsystem training and integration of learning and development activities.

Strategic Risks

Emerging businesses capital expenditure for capacity expansion etc. are normalstrategic risk faced by the company. However the company has well-defined processes andprocedures for obtaining approvals for investments in new business and capacity expansionetc.

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

In pursuant to the provisions of section 177(9) & (10) of the Companies Act 2013and Regulation 22 of SEBI (Listing Obligations and Disclosure Requirements) Regulations2015 a Vigil Mechanism for directors and employees to report genuine concerns has beenestablished. The Vigil Mechanism Policy has been uploaded on the website of the Company athttp://www.lypsa.in/16-17/3Whistle_Blower_Policy.pdf

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 annual financial statements for the year ended March31 2017 the applicable accounting standards have been followed along with properexplanation relating to material departures if any;

b. that such accounting policies have been selected and applied consistently andjudgment and estimates have been made that are reasonable and prudent so as to give a trueand fair view of the state of affairs of the Company as at March 31 2017 and of theprofit of the Company for the year ended on that date;

c. that proper and sufficient care has been taken for the maintenance of adequateaccounting records in accordance with the provisions of the Companies Act 2013 forsafeguarding the assets of the Company and for preventing and detecting fraud and otherirregularities;

d. that the annual financial statements have been prepared on a going concern basis

e. that proper internal financial controls were in place and that the financialcontrols were adequate and 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

All related party transactions that were entered into during the financial year were onan arm’s length basis and were in the ordinary course of business. There were nomaterially significant related party transactions made by the Company with PromotersDirectors Key Managerial Personnel or other designated persons which may have a potentialconflict with the interest of the Company at large.

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.

MATERIAL CHANGES AND COMMITMENT

No material changes and commitments affecting the financial position of the companyoccurred between the end of the financial year to which this financial statements relateon the date of this report.

The company has obtained approval from members of the Company for issue and allotmentof 8424000 Bonus Equity Shares in the ratio of 2 New Equity Share for every 5 existingequity shares held in its Extra Ordinary General Meeting which was held on 28th June2017. In principle approval for the same received from BSE Limited vide BSE letter no.DCS/AMAL/MD/BN-IP/838/2017-18 dated 28.06.2017. In Principle Approval also received fromNational Stock Exchange of India Limited vide its letter no. NSE/LIST/12536 dated17.07.2017

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 SEBI(Listing Obligations and Disclosure Requirements) Regulation 2015 the auditors have alsoconfirmed that they hold a valid certificate issued by the Peer Review Board of theInstitute of Chartered Accountants of India.

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-A".

Reply for qualification Remark in Secretarial Audit Report:

1. Publication of notice of Board of Directors:

The Company has not published notice of meeting of the board of directors wherefinancial results shall be discussed as required under Regulation 47 of SEBI (ListingObligations and Disclosure Requirements) Regulations 2015.

In this regard the management of the Company has provided the following reply:

The company has not published notice of meeting of Board of Director in Newspaper butthe company has uploaded the same on Website of the company and also submitted to BSELimited and to NSE Limited also.

2. Non filling of form IEPF 2:

The Company has not filed form IEPF 2 for unclaimed dividend as per provisions ofsection 96 read with subsection 2 of section 125 of The Companies Act 2013 for uploadingof information regarding unpaid and unclaimed amounts lying with companies

In this regard the management of the Company has provided the following reply:

The company is in process for filling the form IEPF 2 for unclaimed dividend as perprovisions of section 96 read with subsection 2 of section 125 of The Companies Act 2013for uploading of information regarding unpaid and unclaimed amounts lying with companies.

3. Non Deposit of sum to Investor education and protection fund:

As per provisions the company is required to deposit a sum of Rs.749900/- towardsunclaimed dividend for 2009-10 to Investor education and protection fund the company hasnot deposited the same

In this regard the management of the Company has provided the following reply:

The company is in process of complying with the same.

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 inSEBI (Listing Obligations and Disclosure Requirements) Regulation 2015 are complied with.

As per SEBI (Listing Obligations and Disclosure Requirements) Regulation 2015 with theStock Exchanges the Corporate Governance Report Management Discussion and Analysis andthe Auditor’s Certificate regarding compliance of conditions of Corporate Governanceare attached separately and form 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-B".

EXTRACT OF THE ANNUAL RETURN

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

PARTICULARS OF EMPLOYEES

None of the employees of the Company drew remuneration of ` 10200000/- or more perannum ` 850000/- or more per month during the year. Hence no information is required tobe furnished as required under Rule 5(2) and 5(3) of The Companies (Appointment andRemuneration of Managerial Personnel) Rules 2014.

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

The Company has zero tolerance for sexual harassment at workplace and has adopted apolicy against sexual harassment in line with the provisions of Sexual Harassment of Womenat Workplace (Prevention Prohibition and Redressal) Act 2013 and the rules framedthereunder.

During the financial year 2016-17 the company has not received any complaints onsexual harassment and hence no complaints remain pending as of 31 March 2017.

ACKNOWLEDGMENT

Your Directors thank the various Central and State Government DepartmentsOrganizations and Agencies for the continued help and co-operation extended by them. TheDirectors also gratefully acknowledge all stakeholders of the Company viz. customersmembers dealers vendors banks and other business partners for the excellent supportreceived from them during the year. The Directors place on record their sincereappreciation to all employees of the Company for their unstinted commitment and continuedcontribution to the Company.

For Lypsa Gems & Jewellery Ltd

Date: 07/09/2017
Place: Banaskantha SD/- SD/- SD/-
(Manish Janani) (Dipan Patwa) (Jeeyan Patwa)
Managing Director Chairman Director
(DIN: 02579381) (DIN: 2579405) (DIN: 02579469)