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Swarnsarita Gems Ltd.

BSE: 526365 Sector: Consumer
NSE: N.A. ISIN Code: INE967A01012
BSE 00:00 | 17 Feb 8.98 0.24
(2.75%)
OPEN

9.11

HIGH

9.13

LOW

8.31

NSE 05:30 | 01 Jan Swarnsarita Gems Ltd
OPEN 9.11
PREVIOUS CLOSE 8.74
VOLUME 726
52-Week high 13.96
52-Week low 6.33
P/E 3.41
Mkt Cap.(Rs cr) 19
Buy Price 8.31
Buy Qty 10.00
Sell Price 8.98
Sell Qty 340.00
OPEN 9.11
CLOSE 8.74
VOLUME 726
52-Week high 13.96
52-Week low 6.33
P/E 3.41
Mkt Cap.(Rs cr) 19
Buy Price 8.31
Buy Qty 10.00
Sell Price 8.98
Sell Qty 340.00

Swarnsarita Gems Ltd. (SWARNSARITAGEMS) - Director Report

Company director report

To

The members

Swarnsarita gems limited

Your directors have pleasure in presenting their 27th annual report on the auditedstatement of accounts for the financial year ended march 31 2019.

Financial results

(amount र in lakhs)

Particulars Standalone Consolidated
2018-19 2017-18 2018-19 2017-18
Revenue from operations 54823.73 48509.70 54884.23 48633.85
Other income 642.71 472.40 610.30 427.65
Total revenue 55466.44 48982.10 55494.53 49061.50
Total expenses 54759.12 48338.35 54774.06 48414.99
Profit/(loss) before exceptional And Extraordinary 707.32 643.75 720.47 646.50
Items and tax
Exceptional items 0.00 0.00 0.00 0.00
Extraordinary items 0.00 0.00 0.00 0.00
Net profit before tax 707.32 643.75 720.47 646.50
Provision for tax
- current tax 220.00 213.00 224.85 213.00
- deferred tax (liability)/assets 2.42 0.56 3.11 (0.47)
- excess/(short) provision for earlier years 13.36 0.42 13.24 0.42
Net profit after tax 471.54 429.77 479.27 433.55
Profit/(loss) from discontinued operations 0.00 0.00 0.00 0.00
Tax expense of discontinued operations 0.00 0.00 0.00 0.00
Profit/(loss) from discontinued operations (after tax) 0.00 0.00 0.00 0.00
Profit/(loss) for the period 471.54 429.77 479.27 433.55
Other comprehensive income 0.00 0.00 0.00 0.00
- items that will not be reclassified to profit or loss 0.00 0.00 0.00 0.00
- income tax relating to items that will not be reclassified 0.00 0.00 0.00 0.00
To profit or loss
- items that will be reclassified to profit or loss 0.00 0.00 0.00 0.00
- income tax relating to items that will be reclassified to 0.00 0.00 0.00 0.00
Profit or loss
Total comprehensive Income For The Period (comprising profit (loss) and other comprehensive Income for the period) 471.54 429.77 479.27 433.55
Earnings per equity share (for continuing operation):
- basic (in र) 2.26 2.06 2.30 2.08
- diluted (in र) 2.26 2.06 2.30 2.08

Review of operations standalone:

During the year under review the standalone total income was र 55466.44 lakhsas against र 48982.10 lakhs for the corresponding previous year.

Total comprehensive income for the period was र 471.54 lakhs as againstर 429.77 in the corresponding previous year.

Consolidated:

During the year under review the consolidated total income was र 55494.53lakhs as against र 49061.50 for the corresponding previous year.

Total comprehensive consolidated income for the period was र 479.27 lakhs asagainst र 433.55 lakhs in the corresponding previous year.

Transfer to reserves

The board of directors has decided to retain the entire amount of profits in the profitand loss account.

Company's performance and future outlook

- the shrinking business potential on a long term basis is a cause for concern. Importof gold are coming down in volume terms does not auger well for the growth of theindustry.

- highly fluctuating gold price movement both on account of international price of goldand also on account of inr behavior vs. Us$.

- extra ordinary government regulations deployed to control the business in allaspects.

- the effect of rupee demonetization is yet to be seen fully.

- in a falling interest regime all the assets classes are stagnated including gold thatprompts the customer to postpone purchase of gold as an investment to a future date.

- the implementation of central excise and the gst will extremely affect the businessmodel followed by many entities.

- continued monsoon failures in the past three consecutive years affected thepurchasing power of the rural community where from we operate most of our retail outlets.

Dividend

In order to conserve the resources for the further growth of the company yourdirectors think fit not to recommend any dividend for the year under review.

Share capital

The authorised share capital of the company as on march 31 2019 is र220000000.00 divided into 22000000 equity shares of र 10.00 each.

The issued subscribed and paid-up equity share capital of the company as on 31stmarch 2019 is र 208768000.00 comprising of 20876800 shares of र 10.00each. During the year under review the company has not issued any equity shares.

Directors and key managerial personnel

inductions / appointment or re-appointment of director:

at the 26th annual general meeting held on september 26 2018 mr. Mahendra m. Chordiawas re-appointed as the director of the company liable to retire by rotation.

in accordance with section 152(6) of the companies act 2013 and in terms of articlesof association of the company mr. Mahendra m. Chordia (din: 00175686) director of thecompany retires by rotation and being eligible; offers himself for re-appointment at theforthcoming 26th annual general meeting. The board recommends the said reappointment forshareholders' approval.

further on the recommendations of the nomination and remuneration committee the boardof directors had appointed mr. Durgesh kumar kabra (din: 00017670) and mr. Deep shaileshlakhani (din: 08018001) as an additional (independent) directors in their meeting held on18th october 2018 in pursuant to section 161 of the Companies act 2013 read witharticles of association of the company who shall hold the office until the 27th Annualgeneral meeting.

the resolutions for confirming the appointment of mr. Durgesh kumar kabra (din:00017670) and mr. Deep Shailesh lakhani (din: 08018001) as independent directors formspart of the notice convening the 27th annual general meeting (‘agm') scheduled to beheld on 26th september 2019. We seek your support and hope you will enthusiastically votein confirming their appointment to the board.

cessation of directorship: the following director was resigned from the board of thecompany:

Sr. No. Name of the director Designation Date of resignation
1 Mr. Vishal roshanlal nolkha Independent director 18th october 2018
2 Mr. Ashok surana Independent director 18th october 2018

all the directors of the company have confirmed that they satisfy the fit and propercriteria as prescribed under the applicable regulations and that they are not disqualifiedfrom being appointed as directors in terms of section 164(2) of the companies act 2013.

further pursuant to section 203 of the companies act 2013 the key managerialpersonnel of the company are:

Sr. No. Name of kmp Designation
1. Mahendra m. Chordia Managing director
2. Sunny m. Chordia Whole-time director
3. Seema r. Chordia Whole-time director
4. Sanket dangi Chief financial officer
5. Prafulla devaliya Company secretary And Compliance Officer
(resigned w.e.f. 17th january 2019)

Directors' responsibility statement

Pursuant to section 134(3) (c) & 134(5) of the companies act 2013 the board ofdirectors of the company hereby confirms that:

(a) in the preparation of the annual accounts the applicable accounting standards havebeen followed along with proper explanation relating to material departures;

(b) the directors have selected such accounting policies and applied them consistentlyand made judgments and estimates that are reasonable and prudent so as to give a true andfair view of the state of affairs of the company at the end of the financial year and theprofit and loss of the company for that period;

(c) the directors have taken proper and sufficientcare for the maintenance of adequateaccounting records in accordance with the provisions of this act for safeguarding theassets of the company and for preventing and detecting fraud and other irregularities;

(d) the directors have prepared the annual accounts on a going concern basis; and

(e) the directors have laid down internal financialcontrols to be followed by thecompany and that such internal financial controls are adequate and were operatingeffectively.

(f) the directors have devised proper systems to ensure compliance with the provisionsof all applicable laws and that such systems were adequate and operating effectively.

Declaration by independent directors

The independent director(s) have submitted their disclosure to the board that theyfulfillall the requirements as to qualify for their appointment as independent directorunder the provisions of section 149 of the companies act 2013 as well as regulation 17 ofthe securities and exchange board of india (listing obligations and disclosurerequirements) regulations 2015.

Board evaluation

Pursuant to the provisions of the companies act 2013 and the listing agreement /securities and exchange board of india (listing obligations and disclosure requirements)regulations 2015 the board has carried out an annual performance evaluation of its ownperformance the directors individually as well as the evaluation of the working of itscommittees. The directors expressed satisfaction with the evaluation process.

Directors' responsibility statement

Pursuant to section 134(3)(c) & 134(5) of the companies act 2013 the board ofdirectors of the company hereby confirm that:

(a) in the preparation of the annual accounts the applicable accounting standards havebeen followed along with proper explanation relating to material departures;

(b) the directors have selected such accounting policies and applied them consistentlyand made judgments and estimates that are reasonable and prudent so as to give a true andfair view of the state of affairs of the company at the end of the financial year and ofthe profit and loss of the company for that period;

(c) the directors have taken proper and sufficientcare for the maintenance of adequateaccounting records in accordance with the provisions of this act for safeguarding theassets of the company and for preventing and detecting fraud and other irregularities;

(d) the directors have prepared the annual accounts on a going concern basis; and

(e) the directors have laid down internal financial controls to be followed by thecompany and that such internal financial controls are adequate and were operatingeffectively.

(f) the directors have devised proper systems to ensure compliance with the provisionsof all applicable laws and that such systems were adequate and operating effectively.

Number of board meetings

A calendar of meetings is prepared and circulated in advance to the directors. Duringthe year 8 (eight) board meetings were convened and held the details of which are givenin the corporate governance report. The intervening gap between the meetings was withinthe period prescribed under the companies act 2013 and the sebi (lodr) regulations 2015.Further committees of the board usually meet on the same day of formal board meeting orwhenever the need arises for transacting business. The recommendations of the committeesare placed before the board for necessary approval and noting.

Composition of audit committee

Your company has formed an audit committee as per the companies act and the listingagreement / sebi (lodr) Regulations 2015. All members of the audit committee possessstrong knowledge of accounting and financial management.

Further the audit committee is functional as per the provision of section 177 ofcompanies act 2013 and rules made thereunder and as per regulation 18 of securities andexchange board of india (listing obligations and disclosure requirements) regulations2015.

The other details of the audit committee are given in the corporate governance reportappearing as a separate section in this annual report.

Composition of nomination & remuneration committee

Your company has formed a nomination & remuneration committee to lay down norms fordetermination of remuneration of the executive as well as non-executive directors andexecutives at all levels of the company.

The other details of the nomination & remuneration committee are given in thecorporate governance report appearing as a separate section in this annual report.

Nomination and remuneration policy

The board of directors has framed a policy which lays down a framework in relation toremuneration of directors. This policy also lays down criteria for selection andappointment of board members. The board of directors is authorized to decide remunerationto executive directors. The remuneration structure comprises of salary and perquisites.Salary is paid to executive directors within the salary grade approved by the members. Thenomination & remuneration committee has been assigned to approve and settle theremuneration package with optimum blending of monetary and non-monetary outlay.

In terms of requirements prescribed under section 178(3) of the companies act 2013the nomination and remuneration policy inter-alia providing the terms for appointment andpayment of remuneration to directors and key managerial personnel.

During the year there have been no changes to the policy. The same is annexed to thisreport as annexure i and is available on our website www.swarnsarita.in.

Composition of stakeholders relationship committee

Your board has constituted a stakeholders relationship committee to specifically lookinto the mechanism of redressal of grievances of shareholders etc. The committee reviewsshareholder's / investor's complaints like non-receipt of Annual report physicaltransfer/ transmission/transposition split/ consolidation of share certificates issue ofduplicate share certificates etc. This committee is also empowered to consider andresolve the grievance of other stakeholders of the company including security holders.

The other details of the stakeholders relationship committee are given in the corporategovernance report appearing as a separate section in this annual report.

Particulars of employees

The information required pursuant to section 197 read with rule 5(1) of the companies(appointment and remuneration of managerial personnel) amendment rules 2016 in respect ofemployees of the company is enclosed as annexure ii and forms part of this report.

Further no employee of the company is earning more than the limits as prescribedpursuant to section 197 read with rule 5(2) of the companies (appointment and remunerationof managerial personnel) amendment rules 2016 in respect of employees of the company.

Further the names of top ten employees in terms of remuneration drawn are disclosed inannexure iii and forms part of this report.

Extract of annual return:

The extract of the annual return in form mgt-9 as required under section 92 of thecompanies act 2013 is hosted on the website of the company at www.swarnsarita.com.

Details of subsidiary/joint ventures/associate companies

The statement aoc-1 pursuant to the provisions of section 129 (3) of the companies act2013 read with rule 5 of the companies (accounts) rules 2014 regarding subsidiarycompanies is enclosed as annexure iv to this report.

Management discussion and analysis

The management discussion and analysis report which gives a detailed state of affairsof the company's operations forma a part of this annual report as annexure v.

Statutory auditors' and auditors' report

The members of the company at the annual general meeting (‘agm') held on 22ndseptember 2014 approved the appointment of m/s. Suresh anchaliya & co. charteredaccountants as the auditors of the company for a period of five years from the conclusionof the said agm. M/s. Suresh anchaliya & co. Will complete their present term onconclusion of ensuing agm in terms of the said approval and section 139 of the companiesact 2013 (‘the act') read with the companies (audit and auditors) rules 2014.

The board of directors of the company (‘the board') on the recommendation of theaudit committee (‘the committee') proposed to appoint of m/s banshi jain &associates chartered accountants (firm registration no.100990) as the Auditors of thecompany for a period of five years from the conclusion of ensuing agm till the conclusionof the 32nd Agm. On the recommendation of the committee the board also recommended forthe approval of the members the remuneration of m/s. M/s banshi jain & associateschartered accountants for the financial year 2019-20 as set out in the resolutionrelating to their appointment.

The committee considered various parameters like capability to serve a diverse andcomplex business landscape as that of the company audit experience in the company'soperating segments market standing of the firm clientele served technical knowledgeetc. and found m/s banshi jain & associates chartered accountants to be best suitedto handle the scale diversity and complexity associated with the audit of the financialstatements of the company.

M/s banshi jain & associates have given their consent to act as the auditors ofthe company and have confirmed that the said appointment if made will be in accordancewith the conditions prescribed under sections 139 and 141 of the act.

Hence the notice convening the ensuing 27th agm contains a resolution of appointmentof statutory auditors.

Secretarial audit

In terms of section 204 of the companies act 2013 and rules made there under m/s.Deep shukla & associates practicing company secretary have been appointedsecretarial auditors of the company. The secretarial audit report is enclosed as annexurevi to this report.

Explanation(s)/ comment(s) pursuant to section 134(3)(f)(i)& (ii) if any of thecompanies act 2013: explanation pursuant to section 134(3)(f)(i):

There are no adverse remarks/qualifications made in statutory report issued bystatutory auditor of the company.

Explanation pursuant to section 134(3)(f)(ii):

1. Non-compliance for appointment of company secretory for the aforesaid audit period.

Reply:

The management is looking out for suitable candidate to be appointed as an internal ofthe company.

Nte i rnal audit & controls

The company has an internal control system commensurate with the size scale andcomplexity of its operations.

The scope and authority of the internal audit function is defined in the internal auditmanual. To maintain its objectivity and independence the internal audit function reportsto the chairman of the audit committee of the board and to the managing director.

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. Based on the report of internalaudit function process owners undertake corrective action in their respective areas andthereby strengthen the controls. Significant audit observation and recommendations alongwith corrective actions thereon are presented to the audit committee of the board.

Further m/s. Hiran & associates chartered accountants issued their internal auditreport for the financial year ended 31st march 2019.

Employees' stock option plan

The company has not provided stock options to any employee.

Risk management policy

The company has laid down the procedure to inform the board about the risk assessmentand minimization procedures.

These procedures are reviewed by the board periodically to ensure that there is timelyidentification and assessment of risks measures to mitigate them and mechanisms fortheir proper and timely monitoring and reporting.

The company does not fall under the ambit of top 100 listed entities determined on thebasis of market capitalisation as at the end of the immediately preceding financial year.Hence compliance under regulation 21 of sebi (listing Obligations and disclosurerequirements) regulations 2015 is not applicable.

Deposits

The company has not accepted nor renewed any fixed deposits during the fy 2018-2019.

Particulars of loans guarantees or investments

Particulars of loan given investments made guarantes given and securities providedalong with the purpose for which the loan or guarantee or security is proposed to beutilized by the recipient are provided in the notes to the standalone financial statement.(please refer to note nos. 3 & 4 to the standalone financial statement).

insurance

The properties/assets of the company are adequately insured.

Corporate social responsibility (csr)

Since your company does not fall under the threshold laid down in section 135 of thecompanies act 2013 the provision of section 134(3)(o) of the companies act 2013 is notapplicable and no disclosure is required by the board.

Related party transactions

Details of material transactions with related parties on an arm's length basis withrespect to transaction covered under section 188(1) of the act in the prescribed form no.Aoc-2 is annexed with this report and marked as annexure vii. Further details of relatedparty transaction as required under to be disclosed by accounting standard – 18 on"related Party disclosures" specified under section 133 of the act read withrule 7 of the companies (accounts) rules 2014 are given in the notes to the financialstatements.

Corporate governance certificate

We ensure that we evolve and follow the corporate governance guidelines and bestpractices sincerely not only to boost long-term shareholder value but also to respectminority rights. We consider it our inherent responsibility to disclose timely andaccurate information regarding our operations and performance as well as the leadershipand governance of the company.

In compliance with regulation 34(3) read with schedule v(c) of the sebi (lodr)regulations 2015 a report on Corporate governance forms part of this annual report. Thecertificate as issued by practicing company secretary certifying compliance with theconditions of corporate governance as prescribed under schedule v(e) of the sebi (lodr)regulations 2015 is annexed to the corporate governance report as annexure viii.

Disclosure on compliance with the sexual harassment of women at workplace (preventionprohibition and redressal) act 2013:

The company has set up an internal complaints committee for providing a redressalmechanism pertaining to sexual harassment of women employees at the workplace. There wasno case of sexual harassment reported during the year under review.

Conservation of energy research and development technology absorption and foreignexchange

The details of conservation of energy technology absorption foreign exchange earningsand outgo are as follows: (a) conservation of energy -

even though its operations are not energy-intensive and manually executed significantmeasures are taken to reduce energy consumption by using energy-efficient equipment. Thecompany regularly reviews power consumption patterns across all locations and implementrequisite improvements/changes in the process in order to optimize energy/ powerconsumption and thereby achieve cost savings. Energy costs comprise a very small part ofthe company's total cost of operations. However as a part of the company's conservationof energy program the management has appealed to all the employees / workers to conserveenergy.

(b) absorption of technology -

in this era of competition in order to maintain and increase the clients andcustomers we need to provide best quality services to our clients and customers atminimum cost which is not possible without innovation and adapting to the latesttechnology available in the market for providing the services.

(c) research and development (r&d) -

the company believes that in order to improve the quality and standards of servicesthe company has progressive research and development process which should keep onincreasing along with the scale of operations of the company.

(d) foreign exchange earnings and outgo -
(amt. In र lakhs)
Name of the director F.y 2018-2019 F.y 2017-2018
C.i.f. value of imports Nil Nil
F.o.b. value of exports 24323.27 19987.58

Transfer of amounts to investor education and protection fund

Pursuant to the provisions of the companies act 2013 read with the investor educationand protection fund authority (accounting audit transfer and refund) rules 2016 asamended (‘rules') the dividends unclaimed for a consecutive period of seven yearsfrom the date of transfer to the unpaid dividend account of the company are liable to betransferred to iepf. Further the shares (excluding the disputed cases having specificorders of the court tribunal or any statutory

Authority restraining such transfer) pertaining to which dividend remains unclaimed fora period of continuous seven years from the date of transfer of the dividend to the unpaiddividend account are also mandatorily required to be transferred to the iepf establishedby the central government. Accordingly the company has transferred unclaimed dividendeligible to iepf authority within statutory timelines.

Any person whose unclaimed dividend and shares pertaining thereto matured depositsmatured debentures application money due for refund or interest thereon sale proceedsof fractional shares redemption proceeds of preference shares amongst others has beentransferred to the iepf fund can claim their due amount from the iepf authority by makingan electronic application in e-form iepf-5. Upon submitting a duly completed formshareholders are required to take a print of the same and send physical copy duly signedalong with requisite documents as specified in the form to the attention of the nodalofficer at the registered office of the company. The e-form can be downloaded from thewebsite of ministry of corporate affairs www.iepf.gov.in.

Shareholders are requested to get in touch with the rta for encashing the unclaimeddividend/interest/principal amount if any standing to the credit of their account.

Obligation of company under the sexual harassment of women at workplace (preventionprohibition and redressal) act 2013

Harassment of women at workplace (prevention prohibition and redressal) act 2013 hasbeen notified on 9th December 2013. Under the said act every company is required to setup an internal complaints committee to look into complaints relating to sexual harassmentat work place of any women employee.

The company has adopted a policy for prevention of sexual harassment of women atworkplace and has set up committee for implementation of said policy. During the yearcompany has not received any complaint of harassment.

Secretarial standards

The company has in place proper systems to ensure compliance with the provisions of theapplicable secretarial standards issued by the institute of company secretaries of indiaand such systems are adequate and operating effectively.

Listing with stock exchange

The shares of the company are listed on bse only.

Significant and material orders passed by the regulators or courts or tribunals

There are no significant and material orders passed by the regulators / courts /tribunals which would impact the going concern status of the company and its futureoperations.

Prevention of insider trading

The company has adopted a code of conduct for prevention of insider trading with a viewto regulate trading in securities by the directors officers and designated employees ofthe company. The code requires pre-clearance for dealing in the company's shares andprohibits the purchase or sale of company shares by the directors officers and thedesignated employees while in possession of unpublished price sensitive information inrelation to the company and during the period when the trading window is closed. The boardis responsible for implementation of the code. All

Board of directors and the designated employees have confirmed compliance with thecode.

Material changes and commitments affecting the financial position of the company

There have been no material changes and commitments affecting the financial positionof the company which have occurred between the end of the financial year of the company towhich the financial the report.

Acknowledgement

The directors would like to thank all shareholders customers bankers suppliers andeverybody else with whose help cooperation and hard work the company is able to achievethe results. The directors would also like to place on record their appreciation of thededicated efforts put in by the employees of the company.

For and on behalf of the board of directors

Mahendra m. Chordia Sunny m. Chordia
Place : mumbai Managing director Whole-time director
Date :14.08.2019 Din: 00175686 [din: 06664041]
Registered office:
125/127 daya mandir 6th floor
Room no. 5 to 10 mumbadevi
Mumbai – 400003 maharashtra india.