Directors Report of Narbada Gems & Jewellery Ltd.

Mar 31, 2024

The Board of Directors is delighted to present the Thirty Two Annual Report on the business and operations of the Company (‘‘the Company’’ or “NGJL), together with the Audited Financial Statements for the financial year ended March 31,2024 (FY 2023-24).

1. FINANCIAL PERFORMANCE AND OPERATIONS:Financial Results:

The Audited Financial Statements of your Company as on March 31, 2024, are prepared in accordance with the relevant applicable Indian Accounting Standards (“IND AS”) and Regulation 33 of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 (“SEBI Listing Regulations”) and the provisions of the Companies Act, 2013 (“Act”).

The key highlights of standalone financial performance for the year ended March 31,2024, as compared with the previous year is summarized below:

(Rs. in Lakhs)
Particulars	FY 2023-24	FY 2022-23
Revenue from operations	8431.70	9305.35
Other Income	30.38	51.08
Total Revenue	8462.07	9356.42
Expenses	7773.78	8887.0
Profit before Tax	688.30	469.42
Tax Expense
Current tax	179.81	115.40
Tax pertaining to previous years	-	0.98
Deferred tax	-	(2.13)
Profit after T ax	508.48	355.17
Earnings per Equity share	2.40	1.72

(i) Operational Review:

The Company witnessed strong demand across its businesses achieving significant revenue uplift and ending the year on a strong note. Revenue from operations was recorded as Rs. 8462.07 Lakhs against Rs 9356.42 Lakhs during previous year. The Company reported a Net Profit of Rs. 508.48 Lakhs as against Rs. 355.17 Lakhs earned during previous year.

Your Company is actively engaging with customers to nurture long-term partnerships while also seeking to establish new relationships. The Directors remain optimistic about the business''s

prospects and are hopeful for improved performance and increased revenue in the coming year. They are confident that these efforts will lead to greater success and sustained growth for the Company.

2. COMPANY’S STATE OF AFFAIR:

Your overview provides a detailed snapshot of the company''s growth, strategic marketing approach, and industry challenges. Here''s a concise summary highlighting the key points:

Company Performance and Valuation

• Growth Metrics: The Company has experienced impressive growth with a topline CAGR of approximately 35% over the last three years and an EBITDA CAGR of around 21 %.

• Financial Strength: Strong financial fundamentals are evidenced by peer-average net margins and ROE percentages. The intrinsic value of the company exceeds its current market capitalization, suggesting potential for further growth.

New Product Launch

• Product Introduction: The company has expanded its exclusive jewelry line with the launch of the “Vilandi - Flat Polki Diamond Jewellery Collection,” featuring heavy Royal Necklaces adorned with colorful Rubies, Emeralds, and other gemstones.

Marketing Strategy• Communication:

a. Pull Mechanism: Leverages reputation and cumulative advantages to attract customers rather than traditional push methods.

b. Direct Marketing: Utilizes personal presentations, product demonstrations, and participation in industry events to build and maintain relationships.

• Customer Engagement & Retention:

a. Acquisition Criteria: Focuses on clients'' creditworthiness, market standing, and long-term relationship potential.

b. Ongoing Engagement: Regular interaction to align with customer preferences and market trends, aiming for high customer satisfaction and delight.

• Target Audience Segmentation:

a. National Chains: Formal presentations and demonstrations (e.g., Kalyan Jewellers, Malabar Gold & Diamonds).

b. Local Chains: Informal approaches with physical stock presentations (e.g., P. Satyanarayan & Sons, Chemmanur Jewellers).

c. Family Jewellers: Personalized engagement with high retention (e.g., Mangatrai Pearls, Amarsons Pearls & Jewels).

• Distributors & Exporters: Tailored strategies for supply and export (e.g., Tilak Exports Imports).

• Industry Challenges and Future Outlook

a. Labor Issues: Shortage of skilled labor and resistance to automation due to traditional methods.

b. Automation: The shift towards high-end automation is ongoing but slow, with a need for systematic training for new technologies.

FUTURE PROSPECTS: Positive impacts of industry polarization are expected within a few years, improving margins and turnover. The company anticipates maintaining its gross profit margin despite higher top-line growth and will continue to manage fixed expenses and gold price fluctuations effectively.

The long journey of Narbada Gems into its niche space of crafted jewelleryand where it stands today is a testament to the ability to withstand different kinds of challenges in the long-run and not only survive but thrive in their midst.

• The Management exhibits visionary thinking from one generation to the next, each in their own context. One of the more notable displays of the same being the decision & efforts taken to build a strong manufacturing presence. An endeavour thought of and executed by the 4th generation with the wisdom, guidance & platform provided by the earlier generations.

• The Company has moved into the new manufacturing capacity at Basheerbagh, Hyderabad in a premises owned by the promoters for future growth of the Company to cater to growing demand. The new factory will be more technology oriented and shall be a state of art facility with well -planned layout and use of high end tech tools for the designing section. The unit specializes in Gold ornaments studded with flat diamond and color gemstones. The said facility of the Company will be well equipped with state-of-the-art machinery and technology by using Computer Aided Design (CAD and Computer aided model manufacturing (CAM), increasing the overall capacity and enhanced finishing of the products. The management is hopeful that production capacity will be increased to three times.

• The Company is redefining its Production processes and manufacturing facilities are benchmarked against the finest in the world and equipped with the latest, state-of-the-art technologyand machinery leading to a dedicated, loyal and supportive clientele for whom the company is an integral partner and hence there is no incentive for them to deal with cumbersome nature of switching mechanism and related costs.

• Within a short time after moving to the new state of the art factory, the established systems and processes will lead to supply chain efficiency through leveraging of technology and scale of operations will set in. The long-standing presence and legacy of the group as a whole further mitigates threats from incumbents as well as new competitors. In the industry-specific context, it will be difficult to establish a similar level of acceptability amongst jewellery players in India.

This summary captures the essence of your detailed information and can be used to communicate the company’s strengths, strategies, and outlook effectively.

3. DIVIDEND:

During the Financial Year, based on the Company’s performance, In order to conserve resources for further expansion of the Company’s business, your directors have opined to not recommend dividend for the year 2023-24

4. TRANSFER TO RESERVES:

During the period under review, the Board of Directors has decided that Rs. 508.48 Lakhs to be carried forward to the reserves being profit for the year.

5. SHARE CAPITAL:(i) Authorised Capital:

During the year under review, there was no change in the Authorized Share Capital of the Company. The Authorised Share Capital of the Company is at Rs.21,50,00,000/ divided into 2,15,00,000 Equity shares of Rs.10/-each.

(ii) Paid-up Capital:

During the year under review, the Paid-up Share Capital of the Company stands at Rs. 21,15,73,100 divided into 2,11,57,310 Equity shares of Rs. 10 each.

(iii) Provision of money by company for purchase of its own shares by employees or by trustees for the benefit of employees:

The Company has not made any provision of money for purchase of its own shares by employees or by trustees for the benefit of employees as per Rule 16(4) of Companies (Share Capital and Debentures) Rules, 2014.

(iv) Issue of Sweat Equity Shares:

The Company has not issued any sweat equity share during the financial year in accordance with the provisions of Section 54 of Companies Act, 2013 read with Rule 8 of the Companies (Share Capital and Debentures) Rules, 2014.

(v) Issue of Equity Shares with Differential Voting Rights:

The Company has not issued any equity shares with differential voting rights during the financial year as per Rule 4(4) of Companies (Share Capital and Debentures) Rules, 2014.

(vi) Issue of Employee Stock Option:

The Company has not issued any employee stock option during the financial year as per Rule 12 of Companies (Share Capital and Debentures) Rules, 2014.

6. CHANGE IN THE NATURE OF THE BUSINESS, IF ANY:

During the year under review, there has been no change in the nature of the business of the Company.

7. DEPOSITS FROM PUBLIC:

During the year under review, the Company has neither accepted nor renewed any deposits pursuant to the provisions of Section 73 and 76 of the Companies Act, 2013 read with the Companies (Acceptance of Deposits) Rules, 2014 including any modification, amendment and re-enactment thereto for the time being in force from the public.

8. SUBSIDIARY / JOINT VENTURE / ASSOCIATE COMPANIES:

The Company does not have any subsidiary / joint venture / associate companies during the year under review.

9. MANAGEMENT DISCUSSION AND ANALYSIS REPORT:

The detailed report on the Management Discussion and Analysis for the year under review as stipulated under Regulation 34(2)(e) read with Schedule V (B) of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 is presented in a separate section and forms part of this Annual Report. The Audit Committee of the Company has reviewed the Management Discussion and Analysis Report in accordance with the provision of Listing Regulations for the year ended March 31,2024.

10. CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS / OUTGO:A. Conservation of Energy

The disclosure of particulars with respect to conservation of energy pursuant to Section 134(3)(m) of the Companies Act, 2013 read with rule 8(3) of the Companies (Accounts) Rules, 2014 are not applicable as our business is not specified in the Schedule. However, the Company makes its best efforts to conserve energy in a more efficient and effective manner.

B. TechnologyAbsorption

The Company has not carried out any specific research and development activities. Accordingly, the information related to technology absorption, adaptation and innovation is reported to beNIL.

C. ForeignExchangeEarningsandOutgo

During the year under review, the Actual Foreign Exchange Earnings: Rs. 4,03,15,298 Foreign Exchange Outgo:Nil.

11. BOARD OF DIRECTORS AND KEY MANAGERIAL PERSONNEL:

The Board of Directors of the Company comprises ofSix (6) Directors with an optimum combination of Executive, Non-Executive, Independent Directors. The details of Board and Committee composition, tenure of directors, number of meetings and other details are provided in the Corporate Governance Report which forms of this Annual Report.

a) Appointment/Re-appointment/Change in Designation of Director:

During the year under review, there were no changes in the Board of Directors of the Company.

b) Key Managerial Personnel:

i. Appointments during the year: During the Year NIL. But after the end of Financial Year and before Board Report, Ms. Harsha Gami has been appointed as Company Secretary and Compliance Officer of the Company w.e.f 10.08.2023

ii. Resignations:

During the Year NIL. But after Financial Year and before Board Report, Ms. Harsha Gami Company Secretary and Compliance Officer of the Company has resigned w.e.f 15.07.2024.

The Board places on record its appreciation for the valuable contribution made by the Ms. Harsha Gami during her tenure.

Except as mentioned above, there have been no other changes in the Key Managerial Personnel of the Company. As on March 31,2024, the Company has following directors and Key Managerial Personnel:

S. NO.	NAME OF KMP and directors	DESIGNATION
1	Mr. Ramprasad Vempati	Independent Directors
2	Mr. Siddharth Goel	Independent Directors
3	Mr. Sunil Garg	Independent Directors
4	Mr. Sanjay Kumar Sanghi	Managing Director
5	Mr. Bajranglal Agarwal	Chief Financial officer

Remuneration and other matters provided in Section 178(3) of the Act have been disclosed in the Corporate Governance Report, which forms part of this Annual report.

Further on 31.08.2024 following changes took place in the Board Composition;
S. NO.	NAME of Directors	DESIGNATION	Changes
1	Mr. Ramprasad Vempati	Independent Directors	Resigned
2	Mr. Siddharth Goel	Independent Directors	Resigned
3	Mr. Vikarm Goel	Independent Directors	Appointed
4	Mr. Balasubramanyam Danturti	Independent Directors	Appointed

c) Meetings of the Board:

During the year under review, Six(6) meetings of the Board of Directors were convened and held. The intervening gap between the meetings was within the period prescribed under the Act and the SEBI Listing Regulations. The details of Board meetings and other details are provided in the Corporate Governance Report which forms of this Annual Report.

d) Independent Directors:

(i) Statement of Declaration given by Independent Directors:

In compliance with the provisions of Section 149 (7) of the Companies Act, 2013 and Regulation 25 (8) of the Listing Regulations, all the Independent Directors have submitted the Declaration of Independence, stating that they meet the criteria of Independence as laid down in Section 149(6) of the Act and Regulation 16(1) (b) of SEBI Listing Regulations and there has been no change in the circumstances which may affect their status as an Independent Director.

The Independent Directors have also given declaration of compliance with Rule 6(1) and 6(2) of the Companies (Appointment and Qualification of Directors) Rules, 2014, as amended, with respect to their name appearing in the data bank of Independent Directors maintained with Indian Institute of Corporate Affairs.

(ii) Familiarization Programmes for Independent Directors:

In accordance with the requirements of Listing Regulations, all the Independent Directors are familiarized with their roles, rights and responsibilities in the Company at the time of appointment and also on a recurrent basis. The details of the familiarization programme imparted to Independent Directors of the Company during Financial Year 2023-24 are available on the website of the Company at www.narbadajewellery.com

(f) Committee of the Board and details of meetings:

The various Board constituted Committees as stipulated under the Companies Act and Listing Regulations are as follows:

(i) Audit Committee;

(ii) Nomination and Remuneration Committee;

(iii) Stakeholders Relationship Committee;

The committees of the Board meet at regular intervals and have the requisite subject expertise to handle and resolve matters expediently. The details of constitution, terms of appointment and meetings of the committee is given in the Corporate Governance report as Annexure IV.

All the recommendations made by the Committees of Board including the Audit Committee were accepted and approved by the Board.

(g) Appointment of Directors and Remuneration Policy:

The assessment and appointment of members to the Board are based on a combination of criterion that includes ethics, personal and professional stature, domain expertise, gender diversity and specific qualification required for the position. The potential independent Board member is also assessed on the basis of independence criteria defined in Section 149(6) of the Companies Act, 2013 and Regulation 16(1) (b) of the Listing Regulations.

In accordance with Section 178(3) of the Companies Act, 2013, and on recommendations of Nomination and Remuneration Committee, the Board has formulated and adopted a remuneration policy for Directors, Key Management Personnel (KMPs) and Senior Management that outlines the guidelines related to performance evaluation of Directors, remuneration principles and Board diversity, the policy is available on the website of the Company www.narbadajewellery.com

12. BOARD EVALUATION:

In compliance with the provisions of Section 134 (3) (p) of the Companies Act, 2013 read with Rule 8(4) of the Companies (Accounts) Rules, 2014 and Regulation 17 (10) of the Listing

Regulations, an evaluation of the annual performance of the Board, its Committees and Individual Directors were undertaken by the Board. To ensure an effective evaluation process, the Nomination and Remuneration Committee of the Board of Directors (“NRC”) has put in place evaluation framework for conducting the performance evaluation exercise.

Based on the criteria set by NRC, the Board has carried out annual evaluation of its own performance, its committees and individual Directors for financial year 2023-24.

The performance evaluation of the Board was conducted based on key attributes such as composition, administration, corporate governance, independence from Management, safeguarding the interest of the Company and its minority shareholders etc. Parameters for evaluation of Directors included constructive participation in meetings and engagement with colleagues on the Board. Similarly, the Committees were evaluated on parameters such as adherence to their terms of the mandate, deliberations on key issues, reporting to Board etc. Evaluation of the Chairman was focused on the basis of his leadership, guidance to the Board and overall effectiveness. The Directors expressed their satisfaction with the evaluation process.

In a separate meeting held by the Independent Directors, a comprehensive evaluation was conducted on the performance of the Non-Independent Directors, the Board as a whole, and the Chairman of the Board.

13. RELATED PARTY TRANSACTIONS:

All Related Party Transactions are in complianceof the Companies Act, 2013 and the SEBI Listing Regulations. There are no materially significant related party transactions made by the Company with Promoters, Directors or Key Managerial Personnel etc., which may have potential conflict with the interest of the Company at large.

All Related Party Transactions entered into by the Company were in the Ordinary Course of Business and at an Arm’s Length basis and were reviewed and approved by the Audit Committee and the Board and have been approved by shareholders also Omnibus approval is obtained for transactions which are foreseeable and repetitive in nature. A statement of all Related Party Transactions is presented before the Audit Committee on quarterly basis, specifying the nature, value and terms and conditions of the transactions. Complete details of Related Party Transactions are given in the Notes to Financial Statements forming part of this Annual Report.

In compliance with the requirements of the Listing Regulations, the Policy on Materiality of Related Party Transactions and on dealing with Related Party Transaction as approved by the Board may be accessed on the Company’s website: www.narbadajewellery.com

Information on transactions with Related Parties pursuant to Section 134(3)(h) of the Companies Act, 2013 read with Rule 8(2) of the Companies (Accounts) Rules, 2014, are given in Form AOC-2 and is attached as “Annexure - III” to this Annual Report.

14. COMPLIANCE WITH SECRETARIAL STANDARDS:

During the year under review, the Company has complied with the various provisions of all Secretarial Standards, including amendments thereto, as issued by the Institute of Company Secretaries of India (‘ICSI’).

15. DIRECTORS’ RESPONSIBILITY STATEMENT:

In compliance with the provisions of Section 134(3)(c) read with Section 134(5) of the Companies Act, 2013, to the best of their knowledge and belief your Directors state that:

a. In the preparation of the annual accounts for financial year ended March 31,2024, the applicable accounting standards have been followed along with proper explanation relating to material departures, if any;

b. They had selected such accounting policies and applied them consistently and made judgments and estimates that were reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the financial year and of the profit and loss of the Company for the financial year ended March 31,2024;

c. They had taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

d. They had prepared the annual accounts for the financial year ended March, 31, 2024 on a ‘going concern basis’;

e. They had laid down proper Internal Financial Controls to be followed by the Company and that such Internal Financial Controls are adequate and operating effectively; and

f. They had devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.

16. AUDITORS AND AUDIT REPORT:

a) Statutory Auditors: M/s Anant Rao & Malik, Chartered Accountants, (Firm Reg. No.006266S, M.No.022644), Hyderabad were appointed as Statutory Auditors of the Company at the 29th Annual General Meeting of the Company, to hold office till the conclusion of the 33rd Annual General Meeting to be held in the calendar year 2025 for issuing the Audit report on the financialposition of the Company. The Statutory Auditors of the Company had issued their Report for the financial year ended 31st March,2024 which is with unmodified opinion (unqualified).

There is no adverse remark(s)/qualification(s)/reservation(s)of the Statutory Auditors in their report for the financial year ended 31st March, 2024. Hence, no explanation or comments from theBoardunderSection134(3) (f)oftheCompaniesAct,2013isrequired.

Reporting of Frauds by Auditors:

During the year under review, there is no instance of frauds reported by the Auditors under Section 143 (12) of the Companies Act, 2013 and the rules made thereunder.

b) Secretarial Auditor:

In terms of Section 204 of the Companies Act, 2013 and rules made thereunder, CS. Ajay Suman Shrivastava, Practicing Company Secretary, Hyderabad (ICSI Membership No. 3489; CP No.:3479) has been appointed as Secretarial Auditor of the Company. The report of the Secretarial Auditor is enclosed as “Annexure I” to this report.

The Annual Secretarial Compliance report as per Regulation 24A of SEBI (LODR)Regulations, 2015 as amended, is enclosed as “Annexure II” to this report.

c) Internal Auditors:

The Company has appointed M/s Krishna and Suresh, Chartered Accountant ,Hyderabad (Firm Registration No- 001461S) as its Internal Auditors. Their scope of work includes review of processes for safeguarding the assets of the Company, review of operational efficiency, effectiveness of systems and processes, and assessing the internal control strengths in all areas.

17. CREDIT RATINGS:1. CREDIT RATING:

The Company has been awarded CRISIL BB /Stable credit rating for Cash Credit. The rating reflects CRISIL’S expectations that the company’s operational and financial profile will continue to improve backed by its expanding order book position and scale, and it will maintain healthy profit margins.

Details of Bank Lenders & Facilities:
Facility	Amount (Rs.Crore)	Name of Lender	Rating
Cash Credit	16	Kotak Mahindra Bank Limited	CRISIL BB /Stable
Cash Credit	14	Kotak Mahindra Bank Limited	CRISIL BB /Stable
Proposed Term Loan	7		CRISIL BB /Stable
Total	37

18. CORPORATE SOCIAL RESPONSIBILITY (CSR):

In terms of Section 135 and Schedule- VII of the Companies Act, 2013, the provisions of Corporate Social Responsibility (CSR) have not been applicable to the Company so far. However, as the profit for the year under review has exceeded Rs. 5 crores, the Board has constituted Corporate Social Responsibility (CSR)Committee on 31.08.2024 in accordance with the provisions of Section 135 of the Act read with Rules thereto

19. DETAILS IN RESPECT OF ADEQUACY OF INTERNAL FINANCIAL CONTROLS WITH REFERENCE TO THE FINANCIAL STATEMENTS:

The Company has in place proper and adequate internal control systems that commensurate with the nature of its business, as well as the size and complexity of its operations. Internal control systems comprising of policies and procedures designed to ensure the reliability of financial reporting, providing timely feedback on the achievement of operational and strategic goals, ensure compliance with policies, procedures, applicable laws and regulations, and assure that all assets and resources acquired are used economically.

Based on the deliberations with Internal Auditors to ascertain their views on the financial statements, including the financial reporting system and compliance to accounting policies &

procedures, the Audit Committee was satisfied with the adequacy and effectiveness of the internal control system followed by the Company.

20. CODE OF CONDUCT:

In compliance with Regulation 17 (5) of Listing Regulations, the Company has a comprehensive Code of Conduct (‘the Code’) in placeapplicable to all the senior management personnel and Directors including Independent Directors to such extent as may be applicable to them depending on their roles and responsibilities.The Codeprovides guidance on ethical conduct of businessand compliance of law. The Code is available onthe Company’s website atwww.narbadajewellery.com

The Members of the Board and Senior Management Personnel have affirmed compliance with the respective Code of Conduct, as applicable to them for the financial year ended March 31, 2024. A declaration to this effect, signed by the Managing Director in terms of the Listing Regulations, is given in the Corporate Governance Report forming part of this Annual Report.

21. ANNUAL RETURN:

Pursuant to the provisions of Sections 92(3) and 134(3)(a) of the Companies Act, 2013 read with Rule 12 of the Companies (Management and Administration) Rule, 2014, the Annual Return of the Company for the year ended March 31,2024, has been hosted on the Company’s website, which can be accessed at www.narbadajewellery.com

CORPORATE GOVERNANCE AND SHAREHOLDERS INFORMATION:

Your Company is committed to maintain the high standards of corporate governance and adheres to the requirements set out by the Securities and Exchange Board of India. The Report on Corporate Governance as stipulated under the Listing Regulations forms part of the Annual Report. The certificate from the Practicing Company Secretary confirming compliance of conditions of Corporate Governance as stipulated under PartE of ScheduleV of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 is attached as Annexure-IV(a)

22. COMPANY’S POLICIES:

The details of the policies approved and adopted by the Board are provided in the Corporate Governance Report which forms part of this Annual Report.

23. PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS UNDER SECTION 186 OF THE COMPANIES ACT 2013:

The Company has not given any Loans, Guarantees or made any Investments under section 186 of the Companies Act 2013.

24. NOMINATION AND REMUNERATION POLICY:

Nomination and Remuneration Committee works with the Board to determine the appropriate characteristics, skills and experience for the Board as a whole and its individual members with an objective of having a Board with diverse backgrounds and experience. Characteristics expected from all Directors include independence, integrity, high personal and professional ethics, sound business judgment, ability to participate constructively in deliberations and

willingness to exercise authority in a collective manner. Policy on appointment and removal of Directors can be accessed at the web-linkwww.narbadajewellery.com

Based on the recommendations of Nomination and Remuneration Committee, the Board has framed a Remuneration Policy for selection and appointment of Directors, Key Managerial Personnel (KMP), Senior Management and their remuneration,specifying criteria for evaluation of performance and process. As part of the policy, Company strives to ensure that:

i. The level and composition of remuneration is reasonable and sufficient to attract, retain and motivate Directors of the quality required to run the Company successfully;

ii. Relationship between remuneration and performance is clear and meets appropriate performance benchmarks; and

iii. Remuneration to Directors, Key Managerial Personnel (KMP) and Senior Management involves a balance between fixed and incentive pay reflecting short and long-term performance objectives, appropriate to the working of Company and its goals.

The salient features of this policy are:

• This Policy sets out the guiding principles for the Human Resources and Nomination and Remuneration Committee for recommending to the Board the remuneration of the Directors, Key Managerial Personnel (KMP), Senior Management and other employees of the Company.

• It lays down the parameters based on which payment of remuneration (including sitting fees andremuneration) should be made toNon-Executive Directors.

• It lays down the parameters based on which remuneration (including fixed salary, benefits and perquisites, commission, retirement benefits) should be given to Whole-time Directors, KMPs and rest of the employees.

The Remuneration Policy, outlining the principles and guidelines for the compensation of Directors, Key Managerial Personnel (KMP), Senior Management and other employees can be accessed at the web-linkat www.narbadajewellery.com

25. VIGIL MECHANISM/ WHISTLE BLOWER POLICY:

In compliance with the provisions of Section 177 of the Companies Act, 2013 read with Regulation 22 of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 and Securities and Exchange Board of India (Prohibition of Insider Trading) Regulations, 2015, the Company has formulated a comprehensive Whistle Blower Policy to deal with instance of fraud and mismanagement, if any.

The Whistle Blower Policy aims to encourage directors,employees and other stakeholders to report anyinstances of unethical orimproper activity, actual or suspected fraud or violation of the Code of Conduct without fear of retaliation.The policy also providesaccess to the Chairperson of the Audit Committee undercertain circumstances. The policymay be accessed on the Company’s website at www.narbadajewellery.com.

During the year under review, your Company has not receivedany complaints under the vigil mechanism

26. STATEMENT SHOWING THE NAMES OF THE TOP TEN EMPLOYEES IN TERMS OF REMUNERATION DRAWN AND THE NAME OF EVERY EMPLOYEE AS PER RULE 5(2) & (3) OF THE COMPANIES (APPOINTMENT & REMUNERATION) RULES, 2014:

A table containing the particulars in accordance with the provisions of Section 197(12) of the Act, read with Rule 5(2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is appended as Annexure VI (a) to this Report.

A statement showing the names of the top ten employees in terms of remuneration drawn and the name of every employee is annexed to this Annual report as Annexure VI (b).

During the year, NONE of the employees are drawing a remuneration of Rs.1,02,00,000/- and above per annum or Rs.8,50,000/- and above in aggregate per month, the limits specified under the Section 197(12) of the Companies Act,2013 read with Rules 5(2) and 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 other than those mentioned in Annexure VI (b).

27. RATIO OF REMUNERATION TO EACH DIRECTOR:

Under section 197(12) of the Companies Act, 2013, and Rule 5(1) (2) & (3) of the Companies (Appointment & Remuneration) Rules, 2014 read with Schedule V of the Companies Act, 2013 the ratio of remuneration of Managing Director (Mr. Sanjay Kumar Sanghi), Managing Director of the Company to the median remuneration of the employees is Not Applicable since Managing Director is not paid any remuneration for the Financial Year 2023-24.

28. PREVENTION OF INSIDER TRADING AND CODE OF FAIR DISCLOSURE:

In compliance with the provisions of SEBI (PIT) Regulations, 2015, the Board has formulated a Code of Internal Procedures and Conduct to regulate, monitor, and report trading by Insiders. This code outlines the guidelines and procedures to be followed, and the disclosures required by insiders when dealing with Company shares, while also warning them of the consequences of non-compliance. The code of conducthas been hosted on the Company’s website, which can be accessed at www.narbadajewellery.com.

Further, the Board has formulated a Code of Practices and Procedures for Fair Disclosure of Unpublished Price Sensitive Information ("Fair Disclosure Policy"). This code ensures the fair disclosure of events and occurrences that could affect price discovery in the market for the Company’s securities, promoting uniformity, transparency, and fairness in dealings with all stakeholders, and ensuring adherence to applicable laws and regulations. The Fair Disclosure Code has been hosted on the Company’s website, which can be accessed at www.narbadajewellery.com.

29. POLICY ON SEXUAL HARASSMENT:

The Company has always believed in proving a safe and harassment free workplace for every individual working in its premises through various policies and practices. The Company always endeavours to create and provide an environment that is free from discrimination and harassment including sexual harassment.

The Company has adopted a policy on Prevention of Sexual Harassment at Workplace which aims at prevention of harassment of employees and lays down the guidelines for identification, reporting and prevention of undesired behaviour. An Internal Complaints Committee (“ICC”) has been constituted by the senior management (with women employees constituting the majority). The ICC is responsible for redressal of complaints related to sexual harassment and follows the guidelines provided in the Policy.

During the year ended March 31,2024, no complaints pertaining to sexual harassment have been reported.

30. LISTING STATUS:

The Equity Shares of the Company are listed on the BSE Limited (BSE). The annuallisting fees for the year 2024-25 have been paid to the exchanges. The Company has also paid the Annual Custody Fee to the National Securities Depository Limited (NSDL) and Central Depository Services (India) Limited (CDSL) for the financial year ended March 31,2024.

31. REVISION MADE IN FINANCIAL STATEMENTS/ BOARD’S REPORT:

The Company has not made any revisions to the FinancialStatements or Board’s Report for any of the three preceding financial years.

32. SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS:

During the year under review, no significant and /or material orders, passed by any Court or Regulator or Tribunal, which may impact the going concern status of the Company and its future operations.

33. DEVELOPMENTAND IMPLEMENTATION OF RISK MANAGEMENT POLICY:

The Company has a well-defined process in place to ensure appropriate identification and treatment of risks. Risk identification exercise is inter-woven with the annual planning cycle which ensures both regularity and comprehensiveness. The identification of risk is done at strategic, business, operational and process levels. While the mitigation plan and actions for risks belonging to strategic, business and key critical operational risks are driven by senior leadership, for rest of the risks, operating managers drives the conception and subsequent augmenting of mitigation plans.

All risks are well integrated with functional and business plans and are reviewed on a regular basis by the senior leadership.

The Company, through its risk management process, aims to contain the risks within its risk appetite. There are no risks which in the opinion of the Board threaten the existence of the Company.

34. PROCEEDING PENDING UNDER THE INSOLVENCY AND BANKRUPTCY CODE, 2016:

During the year under review, no application have been made under the Insolvency and Bankruptcy Code, 2016, therefore there are no details of application or proceedings pending to disclose under the Insolvency and Bankruptcy Code, 2016 (31 of 2016).

35. ENVIRONMENT, SOCIAL AND GOVERNANCE INITIATIVES:

The Company has taken pioneering steps in the line of business to undertake its manufacturing activity in a premises which is a IGBC certified GREEN Building and the installations have been very carefully structured for minimum use of polluting materials and electrical power. After few months, Company will take steps to fulfill its power requirements from the roof top solar power units also.

The Human capital is of prime importance in the jewellery business and the Company has been marching ahead with various initiative for its PEOPLE. The artisans are supported for their children education, the social aspect of their lives are well taken care.

Being a BSE listed Company, effective and orderly governance comes naturally to the Company which is spearheaded by the Board of Directors and the Standards of Practices to be followed for Board and Governance are well defined and are implemented with a flair of penchant and diligence.

36. HUMAN RESOURCE DEVELOPMENT:

Your Company always believes in keeping the environment pollution free and is fully committed to its social responsibility. The Company has been taking utmost care in complying with all pollution control measures from time to time strictly as per the directions of the Government.

We would like to place on record our appreciation for the efforts made by the management and the keen interest shown by the Employees of your Company in this regard.

37. COST RECORDS:

Your Company is not required to maintain cost records as specified under Section 148 of the Act.

38. MD & CFO CERTIFICATION:

As required Regulation 17(8) read with Schedule II of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, the MD/CFO certification is attached with the Annual report as Annexure IV(b)

39. MANAGERIAL REMUNERATION

The Company’s policy on Director’s appointment and remuneration in accordance with Section178 (3) of the Companies Act, 2013 and the same is available on the website of the Company at www.narbadajewellery.com. No remuneration is being paid to the Managing Director or any other Director of the Company. The information required pursuant to Section 197 read with rule 5 of the Companies (Appointment and Remuneration) Rules, 2014 and Companies (Particulars of Employees) Rules1975, in respect of Directors and KMP’s of the Company are furnished hereunder:

a. All pecuniary relationship or transactions, of the non-executive directors of the Company:

The Non-executive Directors does not have any pecuniary relationship or transactions of the Company.

b. Details of percentage increase in the remuneration of each Director and CFO and Company

Secretary in the Financial Year 2023-24 are as follows:

Name	Designation	Remuneration (inRs.)		Increase%
		2023-24	2022-23
Sanjay Kumar Sanghi	Managing Director	-	-	-
Ritesh Kumar Sanghi	Director	-	-	-
Bajranglal Agarwal	Chief Financial Officer	10,20,000	9,00,000
CS. Shivani Rastogi	Company Secretary & Compliance Officer		5,92,058
CS. Harsha Patidar	Company Secretary & Compliance Officer	1,70,553	-
*For the part of financial year

c. Details of a fixed component and performance-linked incentives, along with the performance criteria: The Company does not have any performance-linked incentives for the Directors and CFO the appointments are made for a fixed period of time on the terms and conditions in the respective resolution passed by the Board/Members in the Meeting

d. Number of permanent employees on the rolls of the Company as on 31 st March, 2024 are 113.

e. Stock option details: Nil

PARTICULARS OF EMPLOYEES:

In terms of the provisions of Section 197 of the Companies Act, 2013, read with rule 5 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 in respect of disclosures in the report w.r.t. employees of the Company. During the year under report, none of the employees was in receipt of remuneration exceeding the limit prescribed under Section 197(12) of the Companies Act, 2013 and Rule 5 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014.

40. GENERAL:

During the year under review, your Directors notify that no disclosure or reporting is required for the following items as there were no transactions related to these items during the financial year under review:

(i) Issue of equity shares with differential rights as to dividend, voting or otherwise.

(ii) Issue of shares (including sweat equity shares) to employees of your Company under any scheme.

(iii) The Company does not have any Employee Stock Option Scheme & Employee Stock Purchase Scheme for its Employees/Directors.

(iv) There was no one-time settlement with any Banks or Financial Institutions during the year. Hence, disclosure pertaining to difference between amount ofthe valuation done at the time of one-time settlement and the valuation done while taking loan is not applicable.

41. HUMAN RESOURCE:

Your Company considers its Human Resources as the key to achieve its objectives. Keeping this in view, your Company takes utmost care to attract and retain quality employees. The employees are sufficiently empowered and such work environment propels them to achieve higher levels of performance. The unflinching commitment of employees is the driving force behind the Company’s vision. Your Company appreciates the spirit of its dedicated employees.

42. ACKNOWLEDGEMENT:

Your Directors place on record their sincere appreciation for the significant contribution made by its employees through their dedication, hard work and commitment at all levels. The Board of Directors also acknowledges the support extended by the analysts, bankers, central and state government organisations and agencies, media, customers, suppliers, shareholders and investors at large. The Board look forward to your continued supportin the Future.

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Mar 31, 2018

The Members,

The Directors have pleasure in presenting the Twenty Sixth Annual Report together with the Audited Financial Statements of the Company for the financial year ended 31st March, 2018

^{1 FINANCIAL SUMMARY} (Rs. in lakhs)

Particulars	31.03.2018	31.03.2017
Revenue from operations	2626.49	1157.49
Other Income	0.02	--
Total Income	2626.51	1157.49
Expenses	2468.25	1123.08
Profit before tax	158.26	34.41
Tax Expense	45.01	10.85
Profit after Tax	113.25	23.56
Earnings per share	2.28	0.79

2. State of Company''s Affairs:

The Company is on growth path with reinforced belief into its manufacturing capabilities.The Company achieved a total turnover of Rs. 2626.49 lakhs for the year ended 31st March, 2018 as compared to Rs. 1157.49 lakhs in the previous year with the increase of 126.91%. The profit after tax during the year ended 31st March, 2018is Rs. 113.25 lakhs whereas the profit after tax for the previous year ended 31st March, 2017 stood at Rs. 23.56 lakhs.

3. UTILIZATION OF PROCEEDS OUT OF PREFERENTIAL ISSUE:

During the year, the Company had issued 90,91,600 warrants under Preferential Issue to Promoter/ Promoter Group and Non-Promoters, convertible into Equity Shares. During the year, 50,46,300 warrants has also been converted into Equity shares in first tranche. From the proceeds of Preferential issue to the tune of Rs. 757.20 Lakhs, the Company could augment the working Capital for expansion of its business operations and has also set up new factory for manufacturing of Gold, Coloured precious stone studded & Diamond Jewellery with emphasis on Diamond Jewellery for enhancement of its manufacturing capabilities.

4. FUTURE OUTLOOK:

The Company at present is dealing in colored precious stone studded jewellery. The collection includes varied range of Gemstone Necklace Set, Earrings and Pendants.After the end of the financial year, the Company has also started manufacturing the products on its own by setting up of its in-house manufacturing unit with the total manufacturing capacity of 15 kgs. per month out of the proceeds of further issue of capital by way of issue of warrants convertible into Equity shares. This would enable the Company to lower its overall processing and jobwork charges and the cost of production as a whole. In view of the latest industry trends for branded jewellery with modern designs, the Company has introduced fresh range of products with creative and light weight jewellery along with uncut and flat diamond jewellery. The Company has also started export of its speciality jewellery and completed the first export after the end of the reporting period.

5. DIVIDEND:

In order to conserve resources for further expansion of the Company''s business, your Directors have opined to not recommend any dividend for the year 2017-18.

6. RESERVES:

Amount to be carried forward to the reserves is Rs. 113.25 Lakhs being profit for the year.

7. SHARE CAPITAL:

As on the financial year ended 31st March, 2018, the paid up share capital of the Company is Rs. 8,01,20,100/- divided into 80,12,010 Equity shares of Rs. 10/- each. During the year under review, the Company has allotted 50,46,300 new Equity shares upon conversion of warrants issued under Preferential Issue @Rs.12.50 Per share.

8. LISTING AGREEMENT:

The shares of your Company are listed at BSE Ltd. The Company has duly complied with all the applicable provisions of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, as amended from time to time except for the 2,10,000 shares issued under Preferential issue and the same are pending for listing due to disclosure requirements.

9. CORPORATE GOVERNANCE

The Corporate Governance Principles implemented by the Company seeks to protect, recognize and facilitate shareholder srights and ensure timely and accurate disclosures to them. Your Company has been constantly reviewing and benchmarking itself with well-established standards of Corporate Governance besides strictly complying with the requirements of the Companies Act, 2013 and the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 to the extent applicable.

It is to be noted that pursuant to Regulation 15 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, the compliance with the Corporate Governance provisions as specified in Regulation 17 to 27, clauses (b) to (i) of Regulation 46(2) and para C, D and E of Schedule V does not apply to your Company as its paid-up share capital does not exceed Rs. 10 Crores and net worth does not exceed Rs. 25 Crores, as on the last day of previous financial year ended 31st March, 2018. However, the Board of Directors and the management of the Company believe that the compliance of law should be in true letter and spirit and that the Company''s legacy of fair, transparent and ethical governance practices shall be maintained.

10. DIRECTORS AND KEY MANAGERIAL PERSONNEL:

In accordance with the provisions of Companies Act, 2013 and the SEBI (Listing Obligations and Disclosure Requirements) Rules, 2015, the Board of Directors of your Company is duly constituted with an optimum combination of executive and non-executive directors. The terms and conditions of appointment of independent directors are as per Schedule IV of the Act. They have submitted a declaration that each of them meets the criteria of independence as provided in Section 149(6) of the Act and there has been no change in the circumstances which may affect their status as independent director during the year.

Mr. Ritesh Kumar Sanghi retires by rotation at the ensuing Annual General Meeting and being eligible, offershimself for re-appointment. His profile is given elsewhere in the report. Your Directors recommend his re-appointment.

During the period under review, Ms. Shreya Mangal had resigned as the Company Secretary and Compliance Officer of the Company. Further, Mr. Ashish Kumar Gupta, has been appointed as Company Secretary and Compliance Officer of the Company w.e.f. 11th January, 2018.

11. NUMBER OF MEETINGS OF THE BOARD:

i) i) The Board Meeting is duly called and convened by giving proper notice to all the directors of the Company. The Board is also authorized to pass any resolution of urgent nature by circulation subject to the compliance of provisions of Companies Act, 2013.

ii) The Agenda for the meeting is prepared in consultation with the Managing Director keeping in view all the matters including operational matters to be discussed by the Board.

iii) Notice of the Board Meeting and the notes to agenda are sent to all the Directors of the Company in advance

iv) Any sensitive matter may be discussed at the meeting without prior intimation to directors in exceptional circumstances.

v) Nine (9) Board meetings were held during the year and the gap between two meetings did not exceed one hundred twenty days. The dates on which the said meetings were held are:

25.05.2017, 31.07.2017, 14.08.2017, 28.08.2017, 16.10.2017, 14.12.2017, 11.01.2018, 13.02.2018 and 14.03.2018. The attendance of each director at the Board Meetings is as follows:

S. No.	Name of Director	Board Meeting
		Held	Attended
1	Shri Sanjay Kumar Sanghi	9	9
2	Shri Ritesh Kumar Sanghi	9	7
3	Smt. Bhavana Sanghi	9	9
4	Shri Siddharth Goel	9	9
5	Shri Ram Prasad Vempati	9	9
6	ShriVinod Agarwal	9	7

The necessary quorum was present for all the meetings.

12. DECLARATION BY INDEPENDENT DIRECTORS:

The Company has received necessary declaration from each independent director under Section 149(7) of the Companies Act,2013, that they meet the criteria of independence laid down in Section 149(6) of the Companies Act, 2013 and Regulation 25 of SEBI(Listing Obligations and Disclosure Requirements) Regulations, 2015.

The terms and conditions for appointment of independent directors are available on the website of the Company at www.narbadajewellery.com.

The Independent Directors of the Company have convened a meeting on 11th January, 2018, exclusively without the presence of non-independent Directors and other members of management, for the evaluation of the Board.

13. BOARD EVALUATION:

The Board of Directors of the Company, upon recommendation of Nomination and Remuneration Committee, have laid down the criteria for performance evaluation of Board, its Committees and the individual Board Members, including Independent Directors pursuant to the provisions of the Companies Act, 2013 and SEBI (Listing Obligations and Disclosure Requirements) Regulation, 2015.

The evaluation of the Board and its committees were based on the criteria covering various assessment parameters like structure and composition, frequency & duration of meetings, its processes and procedures, effectiveness of the Board/ committees, its financial reporting process under various regulations and/ or terms of reference of the committees etc. The criteria for evaluation of performance of the individual Directors included various parameters viz. attendance &participation during the meetings, their active contribution and discussions on important matters, understanding of the Company among others. The performance evaluation of Independent Directors was done by the entire Board and in the evaluation the Director who was subject to evaluation did not participate.

The Board Evaluation Policy specifying the manner and process of evaluation of the performance of the Board is updated on the website of the Company at www.narbadajewellery.com.

14. MANAGERIAL REMUNERATION

No remuneration is paid to the Managing Director or the Whole-time Directors of the Company. The information required pursuant to Section 197 read with rule 5 of the Companies (Appointment and Remuneration) Rules, 2014 and Companies (Particulars of Employees) Rules 1975, in respect of employees of the Company and Directors is furnished hereunder:

i) Median remuneration of the Company for all its employees is Rs. 38,566/- for the Financial Year 2017-18.

ii) Details of percentage increase in the remuneration of each Director and CFO and Company Secretary in the Financial Year 2017-18 are as follows:

Name	Designation	Remuneration (in Rs.)		Increase %
		2017-18	2016-17
Sanjay Kumar Sanghi	Managing Director	-	-	-
Ritesh Kumar Sanghi	Director	-	-	-
Bajranglal Agarwal	Chief Financial Officer	5,97,157	5,74,880	3.88
Ashish Kumar Gupta	Company Secretary*	1,06,656*	-	-
Shreya Mangal	Company Secretary	8,000*	1,48,800*	-

*For part of the Financial Year

iii) Percentage increase in the median remuneration of all employees in the financial year 2017-18:

Particulars	2017-18	2016-17	Increase
	(Amt in Rs.)	(Amt in Rs.)	(decrease)%
Median remuneration of all employees per annum	38,566	1,66,720	(76.87)

Number of permanent employee on the rolls of the Company as on 31st March, 2018 are 52.

13. Familiarization Programme for Independent Directors:

The Company briefs its new Independent Directors on their roles, rights as Independent Director and nature of the industry in which the Company operates, etc. Familiarization Programme for the Independent Directors provides them an opportunity to familiarize with the Company, its management and its operations so as to gain a clear understanding of their responsibilities and contribute significantly towards the growth of the Company.

The Company’s Policy for familiarization of Independent Directors is updated at the website of the Company at www.narbadajewellery.com

15. FAMILIARIZATION PROGRAMME FOR INDEPENDENT DIRECTORS:

The Company briefs its Independent Directors on their roles, rights as Independent Director and nature of the industry in which the Company operates, etc. Familiarization Programme for the Independent Directors provides them an opportunity to familiarize with the Company, its management and its operations so as to gain a clear understanding of their responsibilities and contribute significantly towards the growth of the Company.

The Company''s Policy for familiarization of Independent Directors is updated at the website of the Company at www.narbadajewellery.com

16. COMMITTEES OF THE BOARD:

The Board has constituted three committees at present:

- Audit committee;

- Nomination and Remuneration committee;

- Stakeholders Relationship committee,

The Committees of the Board meet at regular intervals and have the requisite subject expertise to handle and resolve matters expediently. The Board oversees the functioning of the Committees. Detailed terms of reference, composition, meetings and other information of each of the Committees of the Board is detailed here in below:

16A. AUDIT COMMITTEE:

The constitution of Audit Committee of the Board is incompliance with the provisions of Section 177 of the Companies Act, 2013, Regulation 18 of the SEBI (Listing Obligation and Disclosure Requirement) Regulations, 2015. The details of the members of the Audit Committee and their attendance in the Committee meetings are as under:

S. No.	Name of the Director	^ Category	Number of meetings during the FY 2017-18
			Held	Attended
1.	Shri Ramprasad Vempati -Chairman	Independent Non- Executive	4	4
2.	Shri Siddharth Goel	Independent Non- Executive	4	4
3.	Shri Vinod Agarwal	Independent Non- Executive	4	4

Four (4) Audit committee meetings were held during the year and the gap between two meetings did not exceed one hundred twenty days. The dates on which the said meetings were held are as follows: 25.05.2017, 28.08.2017, 14.12.2017 and 13.02.2018.The necessary quorum was present for all the meetings.

The terms of reference of the Audit Committee are broadly given under:

- The recommendations for appointment, remuneration and terms of appointment of auditors of the Company;

- Review and monitor the auditor''s independence and performance, and effectiveness of audit process

- Examination of the financial statement and the auditors'' report thereon;

- Approval or any subsequent modification of transaction of the company with related parties;

- Scrutiny of inter-corporate loans and investments;

- Valuation of undertakings or assets of the Company, wherever it is necessary;

- Evaluation of internal financial controls and risk management systems;

- Monitoring the end use of funds raised through public offers and related matters;

- Review the functioning of the whistle blower mechanism;

- Approval of transactions with related parties.

16B. NOMINATION AND REMUNERATION COMMITTEE:

The constitution of Nomination and Remuneration Committee is in compliance with the requirements of provisions of Section 178 of the Companies Act, 2013, Regulation 19 of SEBI (Listing Obligation and Disclosure Requirement) Regulations, 2015.

The Nominations and Remuneration Committee constituted by the Company is responsible for looking into the remuneration payable to the Whole-time Directors and other Employees of the Company. The Committee also approves the Remuneration Policy for employees other than Whole-time Directors of the Company, as may be recommended to it. The Company has formulated a policy on Nomination and Remuneration of directors in accordance with Section 178 (3) of the Companies Act, 2013 and same is available on website of the Company www.narbadajewellery.com .

The Nomination and Remuneration Committee of the Company as at 31.03.2018 comprises of three directors, all of them being non-executive independent directors:

S. No.	Name of the Director	Category	Number of meetings during the FY 2017-18
			Held	Attended
1.	Shri Vinod Agarwal-Chairman	Independent Non- Executive	2	2
2.	Shri Siddharth Goel	Independent Non- Executive	2	2
3.	Shri Ramprasad Vempati	Independent Non- Executive	2	2

During the year under review, one meeting of the Committee was held on 11.01.2018, for formulation and evaluation of performance of Independent Directors and for assessment and recommendation for the appointment of Company Secretary and Compliance Officer of the Company. Requisite quorum was present for the meeting.

16C. STAKEHOLDERS RELATIONSHIP COMMITTEE:

The Committee ensures cordial investor relations and oversees the mechanism for redressal of investors'' grievances. The Committee specifically looks into redressing shareholders''/investors'' complaints/ grievances pertaining to share transfers, non-receipts of annual reports and other related complaints

The composition of the Stakeholders'' Relationship Committee and the details of meetings attended by its members are given below:

S. No.	Name of the Director	Category	Number of meetings during the FY 2017-18
			Held	Attended
1.	Shri Vinod Agarwal-Chairman	Independent Non- Executive	16	16
2.	Shri Siddharth Goel	Independent Non- Executive	16	16
3.	Shri Ramprasad Vempati	Independent Non- Executive	16	16

The meetings of the stakeholders'' relationship committee were held on 10.04.2017, 08.05.2017, 20.05.2017, 10.06.2017, 20.07.2017, 31.07.2017, 10.08.2017, 31.08.2017, 20.09.2017, 28.09.2017, 12.10.2017, 20.11.2017, 30.12.2017, 11.01.2018, 10.03.2018 and 30.03.2018 during the year, mainly for approval of share transfers, transmission and issue of duplicate share certificates.

17. CONSITUTION OF INTERNAL COMPLAINTS COMMITTEE UNDER SEXUAL HARRASSMENT OF WOMEN AT WORKPLACE (PREVENTION, PROHIBITION AND REDRESSAL) ACT, 2013:

Your management is concerned about the safety of women workforce and has constituted an Internal Complaints Committee under Sexual Harrassment Of Women At Workplace (Prevention, Prohibition And Redressal) Act, 2013. During the financial year 2017-18 there was no such instances reported.

18. CODE OF CONDUCT:

In compliance with the SEBI (Listing Obligations and Disclosure Requirements) Regulation, 2015 and the Companies Act, 2013, the Company has framed and adopted a Code of Conduct. The Code is applicable to the members of the Board, the executive officers, the members of the management one level below the executive directors, including all functional heads of the Company. The Code is available on the website of the Company - www.narbadajewellery.com. All members of the Board, the executive officers and senior financial officers have affirmed compliance to the Code as on March 31, 2018

20. VIGIL MECHANISM:

In accordance with Section 179(9) & (10) of the Companies Act, 2013, the Company has adopted vigil mechanism for directors and employees, to report concerns about unethical behavior, actual or suspected fraud, or violation of the Company''s code of conduct and ethics. The Vigil Mechanism/ Whistle Blower policy is available on the Company''s website www.narbadajewellery.com

18. AUDITORS:

A. Statutory Auditors:

The Company had appointed M/s D.V. Aditya & Co., Chartered Accountants, (Firm Reg. No. 000044S, M. No. 022646), Hyderabad , as Statutory Auditors of the Company at the 25th Annual General Meeting of the Company, to hold office till the conclusion of the 30th Annual General Meeting to be held in the calendar year 2022.

B. Secretarial Auditor:

In terms of Section 204 of the Companies Act, 2013 and rules made there under, Shri Ajay S. Shrivastava, Practicing Company Secretary, Hyderabad (ICSI Membership No. 3489 ; CP No.: 3479)has been appointed as Secretarial Auditor of the Company. The report of the Secretarial Auditor is enclosed as "Annexure I" to this report.

C. Internal Auditors:

The Company has appointed M/s Krishna and Suresh, Chartered Accountant, Hyderabad (Firm Registration No- 001461S) as its Internal Auditor. Their scope of work includes review of processes for safeguarding the assets of the Company, review of operational efficiency, effectiveness of systems and processes, and assessing the internal control strengths in all areas.

22. RISK MANAGEMENT:

Risk Management framework of your Company encompasses practices relating to the identification, analysis, evaluation, treatment, mitigation and monitoring of the external and operational controls risks to achieve our key business objectives. The Board seeks to minimize the adverse impact of the risks, thus enabling the Company to leverage market opportunities effectively and enhance its long-term competitive advantage.

23. EXTRACTS OF ANNUAL RETURN:

Pursuant to the provisions of section 92(3) oftheCompaniesAct,2013 read with Rule 12(1) of the Companies (Management and Administration) Rules, 2014, an extract of annual return in Form MGT-9 is attached as a part of this Annual Report as "Annexure II".

24. ADEQUACY OF INTERNAL FINANCIAL CONTROLS WITH REFERENCE TO THE FINANCIAL STATEMENTS:

The details in respect of internal financial control and their adequacy are included in the Management Discussion & Analysis, which forms part of this report.

25. MATERIAL CHANGES AFFECTING THE FINANCIAL POSITION OF THE COMPANY:

There are no material changes between the date of balance sheet and the date of this report that would affect the financial position of the company.

26. MANAGEMENT DISCUSSION AND ANALYSIS REPORT:

The Management Discussion and Analysis report for the year ended 31st March, 2018 are attached, which forms part of the Annual Report.

27. CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO:

A. Conservation of Energy

The disclosure of particulars with respect to conservation of energy pursuant to Section 134 (3) (m) of the Companies Act, 2013 read with rule 8(3) of the Companies (Accounts) Rules, 2014 are not applicable as our business is not specified in the Schedule . However, the Company makes its best efforts to conserve energy in a more efficient and effective manner.

B. Technology Absorption

The Company has not carried out any specific research and development activities. Accordingly, the information related to technology absorption, adaptation and innovation is reported to be NIL.

C. Foreign Exchange Earnings and Outgo

During the financial year 2017-18, there were NIL Foreign Exchange Earnings & Outgo.

28. CORPORATE SOCIAL RESPONSIBILITY:

As the Company''s net worth does not exceed Rs. 500 Crores or Company''s turnover does not exceed Rs. 1000 Crores or the Company''s net profit does not exceed Rs. 5 Crores for any financial year, the provisions of Section 135 of the Companies Act, 2013 regarding Corporate Social Responsibility (CSR) are not applicable.

29. DIRECTORS'' RESPONSIBILITY STATEMENT:

Your Directors would like to inform the members that the Audited Financial Statements for the year ended 31stMarch, 2018 are in full conformity with the requirement of the Act and they believe that the financial statements reflect fairly the form and substance of transactions carried out during the year and reasonably present the Company''s financial condition and results of operations. M/s D.V. Aditya & Co., Chartered Accountants, Statutory Auditors of the Company, have audited the Financial Statements of the Company and issued their report thereon. Pursuant to the requirement of Section 134(5) of the Companies Act, 2013, your Directors further confirm that:

i) i) In the preparation of the Annual Accounts, the applicable Accounting Standards have been followed along with proper explanations relating to material departures;

ii) The Directors have selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the financial year and of the profit and Loss of the Company for that period;

iii) The Directors have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

iv) The Directors have prepared the annual accounts on a going concern basis.

v) The directors in case of listed company have laid down internal financial controls to be followed by the company and such controls are adequate and are operating effectively.

vi) The Directors have devised proper system to ensure compliance with the provisions of all applicable laws and that such systems are adequate and are operating effectively.

30. PARTICULARS OF EMPLOYEES:

There are no employees drawing remuneration equal or more than the limits specified in Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014.

31. DETAILS OF SUBSIDIARY/JOINT VENTURES/ASSOCIATE COMPANIES:

There are no subsidiaries/ Associate Companies and/ or joint ventures to the Company as on the date of this report.

32. DEPOSITS FROM PUBLIC:

The Company has not accepted any deposits from public and as such, no amount on account of principal or interest on deposits from public was outstanding as on the date of the balance sheet.

33. PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS UNDER SECTION 186:

The Company has not given any loan or guarantee or security or made any investment during the financial year in terms of Section 186 of the Companies Act, 2013.

34. PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES:

The particulars of every contract or arrangements entered into by the Company with related parties referred to in sub-section (1) of section 188 of the Companies Act, 2013 is disclosed in Form AOC-2 as "Annexure III" to this report.

35. ACKNOWLEDGMENT:

Your Directors thank all the employees, customers, vendors, investors and other stakeholders of the Company for their continuous support. The Directors also wish to place on record its appreciation of Banks, Central and Local Governments and regulatory authorities for their guidance and support.

Date: 14.08.2018

Place: -6-291/4/B, 2^nd Floor,

Hyderguda,

Hyderabad- 500029 For and on behalf of Board of Directors

Sd/- Sd/-

(Sanjay Kumar Sanghi) (Ritesh Kumar Sanghi)

Managing Director Director

DIN: 00629693 DIN: 00628033

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Mar 31, 2014

Dear Members

The Directors have pleasure to present the Twenty Second Annual Report of the Company together with the Audited Accounts of Your Company for the year ended 31st March, 2014.

FINANCIAL RESULTS

Your Company''s performance during the year 2013-2014 is summarized below:

(Rs. in Lakhs)

Particulars 2013-14 2012-13

Sales 1615.72 884.32

Other Income 0.00 2.10

Total Income (1 2) 1615.72 886.42

Expenditure 1561.80 835.59

Profit before Tax 53.92 50.83

Tax Expense 10.56 10.17

Profit after Tax 43.36 40.66

Earnings Per Share 0.80 0.75

BUSINESS REVIEW

Your Directors wish to inform you that despite volatile regulatory environment and inflationary pressure, your Company continues to grow strongly. For the financial year ended 31st March, 2014, your Company earned a turnover of Rs. 1615.72 Lakhs as against the turnover of the previous year of Rs. 884.32 Lakhs. This is due to rise in the demand tor the Company''s products in the market.

The Company plans to diversify its product line by penetrating the field of manufacturing diamond jewellery which has shown a steady upward trend in the past few years. The promoters of the Company have rich knowledge and experience in this sector, supported by a specialized workforce to carry on the manufacturing of diamond jewellery. For this purpose, the Company wishes to set-up a separate manufacturing unit.

DIVIDEND:

Due to inadequate profits and in order to conserve resources for expanding the business, your Directors have opined to not recommend any dividend for the year 2013 - 14.

DIRECTORS

Shri Ritesh Kumar Sanghi and Shri Vinod Agarwal retire by rotation at the ensuing Annual General Meeting and being eligible offers themselves for re-appointment. Their respective profiles are given elsewhere in the report. Your Directors recommend their re-appointment.

Smt. Bhavna Sanghi was appointed as Additional Director on the Board of the Company whose term expires at the ensuing Annual General Meeting. The Board recommends her appointment as a Minority Women Director on the Board of the Company, liable to retire by rotation.

FIXED DEPOSITS

Your Company has not accepted any fixed deposits from public during the year.

AUDITORS

M/s. Venugopal & Chenoy, Chartered Accountants, the present statutory auditors of the Company hold office until the conclusion of the forthcoming Annual General Meeting and are eligible for re-appointment. The comments made by the Auditors in their report, if any, have been dealt with in the Notes on Accounts and do not require further comments from Board of Directors.

In accordance with the Companies (Audit & Auditors) Rules, 2014, they are eligible for appointment for next Six years, to be ratified every year, as they have been the Auditors since 2007. The Board recommends their re-appointment.

DIRECTOR''S RESPONSIBILITY STATEMENT:

The Directors confirm:

(i) that in the preparation of the Annual Accounts for the year ended on 31st March 2014, the applicable accounting standards have been followed and that no material departures have been made from the same;

(ii) that the Directors have selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the 31st March 2014 and of the profit for that period;

(iii) that the Directors have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 1956 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

(iv) that the Directors have prepared the annual accounts for the year ended on 31st March 2014 ongoing concern basis.

INDUSTRIAL AND PERSONNEL RELATIONS:

The relationship between the management and the staff continued to be cordial.

PARTICULARS OF EMPLOYEES:

In pursuance of the provisions of Section 217 (2A) of the Companies Act, 1956, read with Companies (Particulars of Employees) Rules, 1975, as amended, the Directors are to report that no employee was in receipt of emoluments as provided in the said Section.

ADDITIONAL INFORMATION AS REQUIRED U/S 217 (1)(e) OF THE COMPANIES ACT, 1956:

The statement giving particulars with respect to conservation of energy, technology absorption and foreign exchange earnings and outgo, as required under Section 217(1)(e) of the Companies Act, 1956, read with the Companies (Disclosure of Particulars in the Report of Board of Directors) Rules, 1988, is attached to the report.

LISTING:

The shares of your Company are listed on the Bombay Stock Exchange Limited. Madras Stock Exchange Limited and the Delhi Stock Exchange Association Limited. The Company has duly complied with all the applicable provisions of the Listing Agreement. Madras Stock Exchange Limited has informed that the Exchange is closing soon as no trading is being carried on.

SUBSIDIARIES:

There are no subsidiaries to the Company as on date of the report.

CODE OF CONDUCT

The Company has adopted a uniform Code of Conduct for Directors and Senior Management Personnel to ensure ethical standards and further compliance to such standards. The object of the code is to conduct the Company''s business ethically with responsibility, integrity, fairness, transparency and honesty. The code of conduct of the Company is published on the website of the Company.

INSURANCE

The properties and assets of your Company are adequately insured.

CORPORATE GOVERNANCE CODE:

The code of Corporate Governance promulgated by Securities and Exchange Board of India is being implemented by your Company on a continuous basis. The Code of Corporate Governance as per Clause 49 of the Listing Agreement is attached herewith. The Compliance Certificate on Corporate Governance received from the Statutory Auditors is also given as an Annexure to this report.

ACKNOWLEDGEMENT

Your Directors take this opportunity to express their gratitude for the assistance and co-operation extended by Government Authorities, Bankers and other business associates along with our esteemed Shareholders and employees.

Dated: 25.08.2014 Place: 3-6-290/18, 1st Floor, Sadana Building, Hyderguda, Hyderabad - 500029

For and on behalf of Board of Directors

(Sanjay Kumar Sanghi) (Ritesh Kumar Sanghi) Managing Director Director DIN: 00629693 DIN: 00628033 Address: 8-2-686/DR/7 Address: 8-2-686/DR/7, Road No. 12, Banjara Road No. 12, Banjara Hills. Hyderabad 500034 Hills, Hyderabad, 500034

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Mar 31, 2013

To, The Members

The Directors have pleasure to present the Twentieth Annual Report of the Company together with the Audited Accounts of Your Company for the year ended 31st March, 2013.

FINANCIAL RESULTS

Your Company''s performance during the year 2012-2013 is summarized below:

(Rs. in Lakhs)

S. No Particulars 2012-13 2011-12

1. Sales 884.32 731.86

2 Other Income 2.10 4.10

3 Total Income (1 2) 886.42 735.96

4 Expenditure 835.59 686.78

5 Profit before Tax 50.83 49.01

6 Tax ExpensE 10.17 3.36

7 Profit after Tax 40.66 45.65

8 Earning Per Share 0.75 0.85

BUSINESS REVIEW

During the year your Company has achieved a turnover of Rs. 8,84,32,473 as against Rs. 7,31,86,555 in the previous year. This is due to increase in gold prices as well as the demand for the product being dealt with by the Company. As a result of this there has been an increase in the profit of the Company to Rs. 50,83,347 in the year.

DIVIDEND:

Due to inadequate profits and in order to conserve resources for expanding the business, your Directors have opined to not recommend any dividend for the year 2012 - 13.

DIRECTORS

Shri Ram Prasad Vempati and Shri Siddharth Goel retire by rotation at the ensuing Annual General Meeting and being eligible offers themselves for re-appointment. Their respective profiles are given elsewhere in the report. Your Directors recommend their re-appointment.

FIXED DEPOSITS

Your Company has not accepted any fixed deposits from public during the year.

AUDITORS

M/s. Venugopal & Chenoy, Chartered Accountants, the present statutory auditors of the Company hold office until the conclusion of the forthcoming Annual General Meeting and are eligible for re- appointment. The Company has received confirmation from them to the effect that their appointment, if made, would be within the prescribed limits under Section 224 (1B) of the Companies Act, 1956. The comments made by the Auditors in their report, if any, have been dealt with in the Notes on Accounts and do not require further comments from Board of Directors.

DIRECTOR''S RESPONSIBILITY STATEMENT:

The Directors confirm:

(i) that in the preparation of the Annual Accounts for the year ended on 31st March 2013, the applicable accounting standards have been followed and that no material departures have been made from the same;

(ii) that the Directors have selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the 31st March 2013 and of the profit for that period;

(iii) that the Directors have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 1956, for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

(iv) that the Directors have prepared the annual accounts for the year ended on 31st March 2013, ongoing concern basis.

INDUSTRIAL AND PERSONNEL RELATIONS:

The relationship between the management and the staff continued to be cordial.

PARTICULARS OF EMPLOYEES:

In pursuance of the provisions of Section 217 (2A) of the Companies Act, 1956, read with Companies (Particulars of Employees) Rules, 1975, as amended, the Directors are to report that no employee was in receipt of emoluments as provided in the said Section.

ADDITIONAL INFORMATION AS REQUIRED U/S 217 (1) (e) OF THE COMPANIES ACT, 1956:

The statement giving particulars with respect to conservation of energy, technology absorption and foreign exchange earnings and outgo, as required under Section 217(1)(e) of the Companies Act, 1956, read with the Companies (Disclosure of Particulars in the Report of Board of Directors) Rules, 1988, is attached to the report.

LISTING:

The shares of your company are listed on Madras Stock Exchange Limited, Delhi Stock Exchange Association Limited and the Bombay Stock Exchange Limited. The Company has duly complied with all the applicable provisions of the Listing Agreement.

SUBSIDIARIES:

There are no subsidiaries to the Company as on date of the report.

CODE OF CONDUCT

The Company has adopted a uniform Code of Conduct for Directors and Senior Management Personnel to ensure ethical standards and further compliance to such standards. The object of the code is to conduct the Company''s business ethically with responsibility, integrity, fairness, transparency and honesty.

INSURANCE

The properties and assets of your Company are adequately insured.

CORPORATE GOVERNANCE CODE:

The Code of Corporate Governance promulgated by Securities & Exchange Board of India is being implemented by your Company on a continuous basis. The Code of Corporate Governance as per Clause 49 of the Listing Agreement is attached herewith. The Compliance Certificate on Corporate Governance received from the Statutory Auditors is also given as an Annexure to this report.

ACKNOWLEDGEMENT

Your Directors take this opportunity to express their gratitude for the assistance and co-operation extended by Government Authorities, Bankers and other business associates along with our esteemed Shareholders and employees.

For and on behalf of Board of Directors

NARBADA GEMS AND JEWELLERY LIMITED

Dated: 02.09.2013

Place: 3-6-290/18,

First Floor, Sadana

Building, Hyderguda,

Hyderabad - 500 029 (Sanjay Kumar Sanghi) (Ritesh Kumar Sanghi) Managing Director Director

---

Mar 31, 2012

To, The Members

The Directors have pleasure to present the Twentieth Annual Report of the Company together with the Audited Accounts of Your Company for the year ended 31st March, 2012.

FINANCIAL RESULTS

Your Company''s performance during the year 2011-2012 is summarized below:

(Rs. in lakhs)

S. No Particulars 2011-12 2010-11

1. Sales 731.86 285.42

2. Other Income 4.10 1.11

3. Total Income (1 2) 735.96 286.53

4. Expenditure 686.78 270.51

5. Profit before Tax 49.01 16.02

6. Tax Expense 3.36 0

7. Profit after Tax 45.65 16.02

8. Earning Per Share 0.85 0.30

BUSINESS REVIEW

During the year your Company has achieved a turnover of Rs. 731.86 lakhs as against Rs. 285.42 lakhs in the previous year. This is due to increase in gold prices as well as the demand for the product being dealt with by the Company. As a result of this there has been an increase in the profit of the Company from Rs. 16.02 lakhs to Rs. 45.65 lakhs.

DIVIDEND:

Due to inadequate profits and in order to conserve resources for expanding the business, your Directors have opined to not recommend any dividend for the year 2011 -12.

DIRECTORS

Shri Ritesh Kumar Sanghi and Shri Vinod Agarwal retire by rotation at the ensuing Annual General Meeting and being eligible offers themselves for re-appointment. Shri Praveen Kumar resigned from the Board w.e.f 13.08.2012. The Board places on record its appreciation for services rendered by Shri Praveen Kumar during his tenure. Shri Siddharth Goel was appointed as an Additional Director and his term expires at the ensuing Annual general Meeting. The Board recommends his appointment as Director liable to retire by rotation. Shri Sanjay Kumar Sanghi has been re-appointed as Managing Director w.e.f. 29.04.2012 for five years. Their respective profiles are given elsewhere in the report. Your Directors recommend their re-appointment.

FIXED DEPOSIT

Your Company has not accepted any fixed deposits from public during the year.

AUDITORS

M/s. Venugopal & Chenoy, Chartered Accountants, the present statutory auditors of the Company hold office until the conclusion of the forthcoming Annual General Meeting and are eligible for re-appointment. The Company has received confirmation from them to the effect that their appointment, if made, would be within the prescribed limits under Section 224 (1B) of the Companies Act, 1956. The comments made by the Auditors in their report, if any, have been dealt with in the Notes on Accounts and do not require further comments from Board of Directors.

DIRECTOR''S RESPONSIBILITY STATEMENT:

The Directors confirm:

(i) that in the preparation of the Annual Accounts for the year ended on 31st March 2012, the applicable accounting standards have been followed and that no material departures have been made from the same;

(ii) that the Directors have selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the 31st March 2012 and of the profit for that period;

(iii) that the Directors have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 1956, for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

(iv) that the Directors have prepared the annual accounts for the year ended on 31st March 2012, on going concern basis.

INDUSTRIAL AND PERSONNEL RELATIONS:

The relationship between the management and the staff continued to be cordial.

PARTICULARS OF EMPLOYEES:

In pursuance of the provisions of Section 217 (2A) of the Companies Act, 1956, read with Companies (Particulars of Employees) Rules, 1975, as amended, the Directors are to report that no employee was in receipt of emoluments as provided in the said Section.

ADDITIONAL INFORMATION AS REQUIRED U/S 217 (1) (e) OF THE COMPANIES ACT. 1956:

The statement giving particulars with respect to conservation of energy, technology absorption and foreign exchange earnings and outgo, as required under Section 217(1)(e) of the Companies Act, 1956, read with the Companies (Disclosure of Particulars in the Report of Board of Directors) Rules, 1988, is attached to the report.

LISTING:

The shares of your company are listed on Madras Stock Exchange Limited, Delhi Stock Exchange Association Limited and the Bombay Stock Exchange. The Company has duly complied with all the applicable provisions of the Listing Agreement.

SUBSIDIARIES:

There are no subsidiaries to the Company as on date of the report.

CODE OF CONDUCT

The Company has adopted a uniform Code of Conduct for Directors and Senior Management Personnel to ensure ethical standards and further compliance to such standards. The object of the code is to conduct the Company''s business ethically with responsibility, integrity, fairness, transparency and honesty.

INSURANCE

The properties and assets of your Company are adequately insured.

CORPORATE GOVERNANCE CODE:

The Code of Corporate Governance promulgated by Securities & Exchange Board of India is being implemented by your Company on a continuous basis. The Code of Corporate Governance as per Clause 49 of the Listing Agreement is attached herewith. The Compliance Certificate on Corporate Governance received from the Statutory Auditors is also given as an Annexure to this report.

ACKNOWLEDGEMENT

Your Directors take this opportunity to express their gratitude for the assistance and co-operation extended by Government Authorities, Bankers and other business associates along with our esteemed Shareholders and employees.

For and on behalf of the Board

For NARBADA GEMS AND JEWELLERY LIMITED

Place: Hyderabad Sanjay Kumar Sanghi Ritesh Kumar Sanghi

Date: 31.08.2012 Managing Director Director

---

Mar 31, 2011

The Members

The Directors have pleasure to present the Nineteenth Annual Report of the Company together with the Audited Accounts of Your Company for the year ended 31st March, 2011.

FINANCIAL RESULTS

Your Company''s performance during the year 2010-2011 is summarized below: (Rs. in lakhs)

S.No Particulars 2010-11 2009-10

1. Sales 285.42 217.53

2 Other Income 1.11 14.55

3. Stock in hand 101.87 12.95

4 Total Income (1 2 3) 388.40 245.03

5 Expenditure 372.36 233.63

6 Profit / Loss Accounts before depreciation and Misc. Exp. Written off (4-5) 16.04 11.40

7 Depreciation .03 0

8 Misc. Expenditure written off 0 0

9 Net Profit 16.01 11.40

10 Earning Per Share 0.30 0.21

BUSINESS REVIEW

Your Company experienced a more than 30% rise in sales in the current year as compared to last year sales from Rs. 217.53 lakhs to Rs. 285.42 lakhs mainly due to increase in gold prices. Due to the persistent increase in the gold rates the quantum demand for gold jewellery is declining among the customers. In order to cope up with the present scenario the Company has planned certain business strategies to penetrate and capture the retail market due to which the Company has managed to attain a reasonable growth which resulted in the increase in the profit from Rs. 11.40 lakhs to Rs. 16.01 lakhs.

DIVIDEND :

Due to inadequate profits and in order to conserve resources for expanding the business, your Directors have opined to not recommend any dividend for the year 2010 -11.

FUTURE OUTLOOK

The Company has tied up with major jewellery manufacturing company for exclusive Distribution network in Andhra Pradesh. There are plans to start the manufacturing segment in the Company to facilitate fast and effective growth and expansion of the Company. Proper strategic planning is being made by the management to analyze and evolve the best process for implementing the idea about manufacturing jewellery using advanced and sophisticated technology which will be cost effective to increase the profit earning capacity of the Company and also creating its own brand. Also plans are being formulated to launch exclusive jewellery brands to foray into retail and fashion jewellery.

DIRECTORS

Shri Sanjay Kumar Sanghi and Shri Ram Prasad Vempati retire by rotation at the ensuing Annual General Meeting and being eligible offers themselves for re-appointment. During the year, Mr. K. Sunder resigned from the Board. The Board places on record its appreciation for services rendered by Mr. K. Sunder during his tenure. Mr. Praveen Kumar was appointed as an Additional Director and his term expires at the ensuing Annual general Meeting. The Board recommends his appointment as Director liable to retire by rotation. Their respective profiles are given elsewhere in the report. Your Directors recommend their re-appointment.

FIXED DEPOSIT

Your Company has not accepted any fixed deposits from public during the year.

AUDITORS:

M/s. Venugopal & Chenoy, Chartered Accountants, the present statutory auditors of the Company hold office until the conclusion of the forthcoming Annual General Meeting and are eligible for re-appointment. The Company has received confirmation from them to the effect that their appointment, if made, would be within the prescribed limits under Section 224 (1B) of the Companies Act, 1956. The comments made by the Auditors in their report, if any, have been dealt with in the Notes on Accounts and do not require further comments from Board of Directors.

DIRECTOR''S RESPONSIBILITY STATEMENT:

The Directors confirm:

(i) that in the preparation of the Annual Accounts for the year ended on 31st March 2011, the applicable accounting standards have been followed and that no material departures have been made from the same;

(ii) that the Directors have selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the 31st March 2011 and of the loss for that period;

(iii) that the Directors have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 1956, for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

(iv) that the Directors have prepared the annual accounts for the year ended on 31st March 2011, ongoing concern basis.

INDUSTRIAL AND PERSONNEL RELATIONS:

The relationship between the management and the staff continued to be cordial.

PARTICULARS OF EMPLOYEES:

In pursuance of the provisions of Section 217 (2A) of the Companies Act, 1956, read with Companies (Particulars of Employees) Rules, 1975, as amended, the Directors are to report that no employee was in receipt of emoluments as provided in the said Section.

ADDITIONAL INFORMATION AS REQUIRED U/S 217 (1) (e) OF THE COMPANIES ACT, 1956:

The statement giving particulars with respect to conservation of energy, technology absorption and foreign exchange earnings and outgo, as required under Section 217(1)(e) of the Companies Act, 1956, read with the Companies (Disclosure of Particulars in the Report of Board of Directors) Rules, 1988, is attached to the report.

LISTING:

The shares of your company are listed on Madras Stock Exchange Limited, Delhi Stock Exchange Association Limited and the Bombay Stock Exchange. The Company has duly complied with all the applicable provisions of the Listing Agreement

SUBSIDIARIES:

There are no subsidiaries to the Company as on date of the report.

CODE OF CONDUCT

The Company has adopted a uniform Code of Conduct for Directors and Senior Management Personnel to ensure ethical standards and further compliance to such standards. The object of the code is to conduct the Company''s business ethically with responsibility, integrity, fairness, transparency and honesty.

INSURANCE

The properties and assets of your Company are adequately insured.

CORPORATE GOVERNANCE

The Code of Corporate Governance promulgated by Securities & Exchange Board of India is being implemented by your Company on a continuous basis. The Code of Corporate Governance as per Clause 49 of the Listing Agreement is attached herewith. The Compliance Certificate on Corporate Governance received from the Statutory Auditors is also given as an Annexure to this report.

ACKNOWLEDGEMENT

Your Directors take this opportunity to express their gratitude for the assistance and co-operation extended by Government Authorities, Bankers and other business associates along with our esteemed Shareholders and employees.

For and on behalf of the Board of Directors

NARBADA GEMS AND JEWELLERY LIMITED

Sd/- Sd/-

Place: Hyderabad (Sanjay Kumar Sanghi) (Ritesh Kumar Sanghi)

Managing Director Date: 29.08.2011 Director

---

Mar 31, 2010

The Directors have pleasure to present the Eighteenth Annual Report of the Company together with the Audited

Accounts of Your Company for the year ended 31st March, 2010.

FINANCIAL RESULTS

Your Companys performance during the year 2009-2010 is summarized below:

(Rs. in lakhs)

S.No Particulars 2009-10 2008-09

1. Sales 217.53 222.27

2Other Income 14.45 -

aStock in hands 12.95 -

4Total Income (1+2+3) 245.03 222.27

5Expenditure 233.63 212.11

6 Profit / Loss Accounts before depreciation and

Misc. Exp. Written off (4-5) 11.40 10.16

7 Depreciation 0 0

8 Misc. Expenditure written off 0 0.02

9 Net Profit 11.40 10.13

10 Earning Per Share 0.21 0.18

BUSINESS REVIEW

Your Company experienced a small decline in sales in the current year to Rs. 217.53 lakhs compared to last year sales of Rs. 222.27 lakhs. The demand for jewellery and gems has not been able to pick up alongside the start of recovery of markets after the recessionary phase. The fears of slow growth of American and European economies have brought the respective currency values down and consequently the prices of Gold and Silver have witnessed quantum jump which has resulted in lower sales for the Company. The Company witnesses demand from HNIs who are now buying bullion to offset the loss on other investments. On the other hand, the decline in disposable incomes of large base of customers and due to increase in high purchasing cost, the savings of middle class has drastically declined, which resulted in the low demand for jewellery. Even after testing market conditions and high administrative costs, the Company has maintained profit of Rs.11.40 lakhs against Rs. 10.16 lakhs in the previous year due to various austerity measures implemented.

DIVIDEND:

Due to inadequate profits and in order to conserve resources for expanding the business, Your Directors have opined to not recommend any dividend for the year 2009-10.

FUTURE OUTLOOK

The Company had planned to launch few brands to position itself into various customer segments which could not take off due to pressing market conditions. However, since the world economies are on recovery path, the future looks optimistic and therefore the Company has tied up with a major jewellery manufacturing company for exclusive Distribution network in Andhra Pradesh.. The Company has used the time to build up a strategy to give a boost to exports which were started last year and a customer base was made.

The Company has perceived the need for own manufacturing facilities and therefore is planning to create a strategic alliance for the purpose in near future for a precious stone jewellery This will enable the Company to launch its own brands and penetrate the markets far and deep and this in turn would entail into building a Branil Value and visibility. The Promoters are committed to take the Company to cross Rs. 10 crores turnover in yejr ending March, 2011. ?

DIRECTORS

Shri. Ritesh Kumar Sanghi and Shri V.K Agarwal retire by rotation at the ensuing Annual General Meeting and being eligible offers themselves for re-appointment. Their respective profiles are given elsewhere in the report. Your Directors recommend their re-appointment.

FIXED DEPOSIT

Your Company has not accepted any fixed deposits from public during the year.

AUDITORS:

M/s. Venugopal & Chenoy, Chartered Accountants,, the present statutory auditors of the Company hold office until the conclusion of the forthcoming Annual General Meeting and are eligible for re-appointment. The Company has received confirmation from them to the effect that their appointment, if made, would be within the prescribed limits under Section 224 (1B) of the Companies Act, 1956.

DIRECTORS RESPONSIBILITY STATEMENT:

The Directors confirm:

(i) that in the preparation of the Annual Accounts for the year ended on 31st March 2010, the applicable accounting standards have been followed and that no material departures have been made from the same;

(ii) that the Directors have selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the 31s March 2010 and of the loss for that period;

(iii) that the Directors have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 1956, for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

(iv) that the Directors have prepared the annual accounts for the year ended on 31st March 2010, ongoing concern basis.

INDUSTRIAL AND PERSONNEL RELATIONS:

The relationship between the management and the staff continued to be cordial.

PARTICULARS OF EMPLOYEES:

In pursuance of the provisions of Section 217 (2A) of the Companies Act, 1956, read with Companies (Particulars of Employees) Rules, 1975, as amended, the Directors are to report that no employee was in receipt of emoluments as provided in the said Section.

ADDITIONAL INFORMATION AS REQUIRED U/S 217 (1) (e) OF THE COMPANIES ACT. 1956:

The statement giving particulars with respect to conservation of energy, technology absorption and foreign exchange earnings and outgo, as required under Section 217(1)(e) of the Companies Act, 1956, read with the Companies (Disclosure of Particulars in the Report of Board of Directors) Rules, 1988, is attached to the report.

CORPORATE GOVERNANCE

The Corporate Governance and Management Discussion Analysis Report are annexed hereto as Annexure - 2 & 3 respectively and they form part of Director Report

ACKNOWLEDGEMENT

Your Directors express their appreciation for the support received from the Banks, Government Authorities, Customers, Vendors and Shareholder.

For and on behalf of the Board of Directors

Sd/- Sd/-

Place: Hyderabad (Sanjay Kumar Sanghi) (Ritesh Kumar Sanghi)

Date: 04.09.2010 Managing Director Director

---

Mar 31, 2009

The Directors have pleasure to present the Seventeenth Annual Report of the Company together with the Audited

Accounts of Your Company for the year ended 31st March, 2009

FINANCIAL RESULTS

Your Companys performance during the year 2008-2009 is summarized below: (Rs. in lakhs) Sl.No. I Particulars 2008-09 2007-08 1. "Sales 222.27 688.07 2 Other Income 0J8 a Stock in hand 64.44 4 Total Income (1+2+3) 222.27 753.29 5 Expenditure 212.11 705.82 6 Profit / (Loss) before depreciation and Tax Expenses 10.16 47.47 7 Depreciation 0 0 8 Tax Expenses 002 O02 9 Net Profit after Tax 10.13 47.45 10 Earning Per Share 0.18 0.88

BUSINESS REVIEW

Your Company has also suffered the vagaries of the recessionary pressure that set in last year and the slack operations during the year ended 31.03.2009 could generate sales of Rs 222.27 lakhs only as against sale of Rs 688.07 Lakhs during the previous Year. The huge drop in sales in the entire jewellery industry due to dipping purchasing power of the customers. Even the festival seasons could not bring required turnaround and boost to sales. This has resulted in lower profits due to the high administrative costs and the profits dipped to Rs. 10.16 lakhs as against Rs. 47.47 lakhs in previous year.

DIVIDEND:

Your directors have not recommended any dividends for the year 200809.

FUTURE OUTLOOK

The Company had planned to launch few brands to position itself into various customer segments. The plans could not be implemented due to the recessionary pressure and it was found prudent to hold the plans for sometime. Recently, the markets have started showing recovery in few segments and it is perceived that the jewellery market will also pick with the onset of festive season starting Dussera. The Company has used the time to build up a strategy to give a boost to exports which were started last year and a customer base was made. The Company is making efforts to enlarge the spectrum of products in traditional and diamond jewellery and is all set to embark upon a Brand building exercise in near future.

The Company has also drawn up plans for embarking upon a scheme of restructuring in order to attract fresh capital to be able to prepare itself for growth when the markets start to show positive signs of revival.

DIRECTORS

Shri Vinod Kumar Agarwal and Shri Ritesh Kumar Sanghi retire by rotation at the ensuing Annual General Meeting and being eligible offers themselves for reappointment. Their respective profiles are given elsewhere in the report. Your Directors recommend their reappointment.

FIXED DEPOSIT

Your Company has not accepted any fixed deposits from public during the year.

AUDITORS:

M/s. Venugopal & Chenoy, Chartered Accountants, the present statutory auditors of the Company hold office until the conclusion of the forthcoming Annual General Meeting and are eligible for reappointment. The Company has received confirmation from them to the effect that their appointment, if made, would be within the prescribed limits under Section 224 (1B) of the Companies Act, 1956.

DIRECTORS RESPONSIBILITY STATEMENT: Pursuant to Section 217 (2AA) of the Companies Act, 1956.

The Directors confirm:

(i) that in the preparation of the Annual Accounts for the year ended on 31st March 2009, the applicable

accounting standards have been followed and that no material departures have been made from the same;

(ii) that the Directors have selected such accounting policies and applied them consistently and made

judgments and estimates that are reasonable and prudent so as to give a true and fair; view of the state of affairs of the company at the 31st March 2009 and of the profit for that period;

(iii) that the Directors have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 1956, for safeguarding the assets of the Company and for preventing and detecting fraud, and other irregularities;

(iv) that the Directors have prepared the annual accounts for the year ended on 31st March 2009, ongoing concern basis.

INDUSTRIAL AND PERSONNEL RELATIONS:

The relationship between the management and the employees continued to be cordial.

PARTICULARS OF EMPLOYEES:

In pursuance of the provisions of Section 217 (2A) of the Companies Act, 1956, read with Companies (Particulars of Employees) Rules, 1975, as amended, the Directors are to report that no employee was in receipt of emoluments as provided in the said Section.

ADDITIONAL INFORMATION AS REQUIRED U/S 217(1)ie) OF THE COMPANIES ACT. 1956:

The statement giving particulars with respect to conservation of energy, technology absorption and foreign exchange earnings and outgo, as required under Section 217(1)(e) of the Companies Act, 1956, read with the Companies (Disclosure of Particulars in the Report of Board of Directors) Rules, 1988, is attached to the report.

CORPORATE GOVERNANCE

The Corporate Governance and Management Discussion Analysis Report are annexed hereto as Annexure 2 & 3 respectively and they form part of Director Report

ACKNOWLEDGEMENT

Your Directors express their appreciation for the support received from the Banks, Government Authorities, Customers, Vendors and Shareholders.

For and on behalf of the Board of Directors

Sd/ Place: Hyderabad (Sanjay Kumar Sanghi) Date: 31.08.2009 Managing Director

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Mar 31, 2008

The Directors hereby present the Sixteenth Annual Report of the Company together with the Audited Accounts of your Company for the year ended 31st March 2008.

FINANCIAL RESULTS:

Your Companys performance during 2007-2008 is summarized below:

(Rs. in lakhs)

Sl.# Particulars 2007-08 2006-07

1. Sales 688.07 127.64 2. Other Income 0.78 19.16 3. Stock-in Hand 64.44 0.00 4. Total Income (1+2) 753.29 146.80 5. Expenditure 705.82 124.19 6. Profit / Loss before depreciation and Misc. Exp written off (4-5) 47.47 22.61 7. Depreciation 0 0 8. Misc. Exp. written off 0.02 52.24 9. Net Profit (+) / Loss (-) [6-(7+8)] 47.45 29.63

BUSINESS REVIEW:

In the full year of operations ended 31.03.2008, the Company generated sales of Rs. 688.07 lakhs as against Rs. 127.64 lakhs in previous year due to substantial increase in the price of gold and gold products. The raw materials also got pricier thereby not allowing the Company to generate better profitability. However due to better Seasonal Demands for jewellery, specially for some occasions and as well in the trendy jewellery items, the sales picked up. The marginal profits have not allowed the Board of directors to recommend any dividend.

FUTURE OUTLOOK:

The Management of the Company is planning to launch few more brands of the Jewellery so as to attract all groups of people and to tap the market demands in both ornamental and studded jewellery products. The Management of the company is also proposing to export the products with traditional Indian designs of ornamental and studded jewellery products to various other countries in order to increase the Revenues of the Company.

Due to increase in prices of Gold, the sales have shown a decline but the Company can foresee a better current year on account of large range of products / brands being planned for all segment of the consumers in India and abroad.

DIRECTORS:

Mr.Sunder Kanaparthy and Mr. Vempati Ram Prasad retires by rotation at the ensuing Annual General Meeting and being eligible offers themselves for re-appointment.

FIXED DEPOSITS:

Your Company has not accepted any deposits from the public during the year.

AUDITORS:

M/s. Venugopal & Chenoy, Chartered Accountants, the present statutory auditors of the Company hold office until the conclusion of the forthcoming Annual General Meeting and are eligible for re-appointment. The Company has received confirmation from them to the effect that their appointment, if made, would be within the prescribed limits under Section 224 (1B) of the Companies Act, 1956.

DIRECTORS RESPONSIBILITY STATEMENT:

The Directors confirm:

(i) that in the preparation of the Annual Accounts for the year ended on 31st March 2008, the applicable accounting standards have been followed and that no material departures have been made from the same;

(ii) that the Directors have selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the company at the 31st March 2008 and of the loss for that period;

(iii) that the Directors have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 1956, for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

(iv) that the Directors have prepared the annual accounts for the year ended on 31st March 2008, ongoing concern basis.

INDUSTRIAL AND PERSONNEL RELATIONS:

The relationship between the management and the staff continued to be cordial.

PARTICULARS OF EMPLOYEES:

In pursuance of the provisions of Section 217 (2A) of the Companies Act, 1956, read with Companies (Particulars of Employees) Rules, 1975, the Directors are to report that no employee was in receipt of emoluments as provided in the said Section.

ADDITIONAL INFORMATION AS REQUIRED U/S 217 (1) (e) OF THE COMPANIES ACT. 1956:

The statement giving particulars with respect to conservation of energy, technology absorption and foreign exchange earnings and outgo, as required under Section 217(1)(e) of the Companies Act, 1956, read with the Companies (Disclosure of Particulars in the Report of Board of Directors) Rules, 1988, is enclosed as Annexure 1

CORPORATE GOVERNANCE:

The report on Corporate Governance and Management Discussion Analysis Report are annexed hereto as Annexure - 2 & 3 respectively and they form part of Directors Report.

ACKNOWLEDGMENTS:

Your Directors express their appreciation for the support received from the Bank, Government Authorities, Customers, Vendors and Shareholders.

For and on behalf of the Board of Directors of Narbada Gems and Jewellery Limited

Sd/- Sd/- Place : Hyderabad (Sanjay Kumar Sanghi) (V.K.Agarwal) Date : 25.06.2008 Managing Director Director

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Mar 31, 2007

The Directors hereby present the Fifteenth Annual Report of the Company together with the Audited Accounts of your Company for the year ended 31 st March 2007.

FINANCIAL RESULTS:

Your Companys performance during 2006-2007 is summarized below:

(Rs. in lakhs) Sl. # Particulars 2006-07 2005-06

1. Sales 127.64 0 2. Other Income 19.16 5.26 3. Total Income (1+2) 146.80 5.26 4. Expenditure 124.19 156.58 5. Profit / Loss before depreciation and Misc. Exp written off (3-4) 22.61 -151.32 6. Depreciation 0 0 7. Misc. Exp. written off 52.24 0 8. Net Profit (+)/Loss (-) [5-(6+7)] -29.63 -151.32

BUSINESS REVIEW AND FUTURE OUTLOOK:

Members are aware that after the Takeover of the Company as per SEBI Takeover Code by the present Management, the Company has changed its line of business to Manufacturing and trading of Jewellery, gems, bullion and other related activity in accordance with the changed Main Objects approved by Members by Postal Ballot on 27.12.2006. Hence, the business undertaken in new activity is only for Three months that is reflected in the Audited Accounts as at 31s1 March, 2007. However, the new Management is placing their best efforts to generate substantial revenues in the current full year of operations. During the year ended 31.03.2007, the Company generated sales of Rs. 127.64 lakhs as against NIL sales in previous year. However, due to a heavy write off on assets, the Company has made loss of Rs. 29.63 lakhs during the year.

DIRECTORS:

After the change of Management, on 14.10.2006, the erstwhile Directors namely Mr. Amarjot Singh, Mr. Harbans Singh resigned and Mr. Sanjay Kumar Sanghi, Mr. V.K Agarwa.l and Mr. N. Sunder joined the Board as Additional Directors and were reappointed in Annual General Meeting. Mr. V. Ramprasad joined the Board as Additional Director during the year. In accordance with provisions of Section 256 of the Companies Act, 1956 and the Articles of Association, Mr. Ritesh Kumar Sanghi and Mr. V.K. Agarwal, retire by rotation at the ensuing Annual General Meeting and being eligible offers themself for re-appointment. Mr. V. Ram Prasad has been opted on the Board as Additional Director and in accordance with the provisions of Section 260 of the Act, his term expires at the ensuing Annual General Meeting. As required u/s 257 of the Act, Company has received a notice proposing his appointment as director. The Board recommends his appointment as Director liable to retire by rotation.

FIXED DEPOSITS:

Your Company has not accepted any deposits from the public during the year.

AUDITORS:

Mis. Venugopal & Chenoy, Chartered Accountants, the present statutory auditors of the Company hold office until the conclusion of the forthcoming Annual General Meeting and are eligible for re- appointment. The Company has received confirmation from them to the effect that their appointment, if made, would be within the prescribed limits under Section 224 (1B) of the Companies Act, 1956. DIRECTORS RESPONSIBILITY STATEMENT: The Directors confirm:

(i) that in the preparation of the Annual Accounts for the year ended on 31st March 2007, the applicable accounting standards have been followed and that no material departures have been made from the same;

(ii) that the Directors have selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the company at the 31" March 2007 and of the loss for that period;

(iii) that the Directors have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 1956, for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

(iv) that the Directors have prepared the annual accounts for the year ended on 31" March 2007, on going concern basis.

INDUSTRIAL AND PERSONNEL RELATIONS:

The relationship between the management and the staff continued to be cordial.

PARTICULARS OF EMPLOYEES:

In pursuance of the provisions of Section 217 (2A) of the Companies Act, 1956, read with Companies (Particulars of Employees) Rules, 1975, the Directors are to report that no employee was in receipt of emoluments as provided in the said Section.

ADDITIONAL INFORMATION AS REQUIRED U/S 217 (1) (e) OF THE COMPANIES ACT. 1956:

The statement giving particulars with respect to conservation of energy, technology absorption and foreign exchange earnings and outgo, as required under Section 217( 1 )(e) of the Companies Act, 1956, read with the Companies (Disclosure of Particulars in the Report of Board of Directors) Rules, 1988, is enclosed as Annexure 1

CORPORATE GOVERNANCE:

The report on Corporate Governance and Management Discussion Analysis Report are annexed hereto as Annexure - 2 & 3 respectively and they form part of Directors Report. ACKNOWLEDGMENTS:

Your Directors express their appreciation for the support received from the Bank, Government Authorities, Customers, Vendors and Shareholders.

For and on behalf of the Board of Directors

Sd/- Sd/-

Place: Hyderabad (Sanjay Kumar Sanghi) (V.K.Agarwal) Date : 30-06-2007 Managing Director Director

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Mar 31, 2006

Your Directors hereby present the Fourteenth Annual Report of the Company together with the Audited Accounts of your Company for the year ended 31st March 2006.

FINANCIAL RESULTS:

Your Companys performance during 2005-2006 is summarized below;

(Rs. in lakhs) Sl.# Particulars 2005-06 2004-05

1. Sales 0 1752.09

2. Other Income 5.26 15.77

3. Total Income (1+2) 5.26 1767.86

4. Expenditure 156.58 1803.15

5. Profit/Loss before depreciation and Misc. Exp written off (3-4) -151.32 -35.29

6. Depreciation. 0 19.21

7. Misc. Exp. written off 0 4.76

8. Net Profit (+)/Loss (-) [5-(6+7)] -151.32 -59.26

BUSINESS REVIEW AND FUTURE OUTLOOK:

Members are aware that during the year 2005 the Company has sold the Companys plant located at 38/2, Kilometer Stone, Kesoram Village, Chevella Mandal, R.R. Dist. A.P and out of the proceeds thereof has fully repaid the due of. State Bank of India under a One Time Settlement scheme. During the year, there was no business activity and hence no income from operations. There was a loss of Rs. 155.26 lakhs during the year as compared to Rs. 59.26 lakhs in last year mainly on account of the administrative expenses and loss on sale of assets. The management of the Company is considering a strategic sale of equity in order to revive the Company.

DIRECTORS:

In accordance with provisions of Section 256 of the Companies Act, 1956 and the Articles of Association, Mr. Amarjyot Singh, Director of the Company, retires by rotation at the ensuing Annual General Meeting and being eligible offers himself for re-appointment. Mr. Ritesh Sanghi has been opted on the Board as Additional Director and in accordance with the provisions of Section 260 of the Act, his term expires at the ensuing Annual General Meeting. As required us 257 of the Act, Company has received a notice proposing his appointment as director. The Board recommends his appointment as Director liable to retire by rotation.

FIXED DEPOSITS:

Your Company has not accepted any deposits from the public during the year.

AUDITORS:

M/s. Venugopal & Chenoy, Chartered Accountants, the present statutory auditors of the Company hold office until the conclusion of the forthcoming Annual General Meeting and are eligible for re- appointment. The Company has received confirmation from them to the effect that their appointment, if made, would be within the prescribed limits under Section 224 (1 B) of the Companies Act, 1956.

DIRECTORS RESPONSIBILITY STATEMENT:

The Directors confirm:

(i) that in the preparation of the Annual Accounts for the year ended on 31st March 2006, the applicable accounting standards have been followed and that no material departures have been made from the. same;

(ii) that the Directors have selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the company at the 31st March 2006 and of the loss for that period;

(iii) that the Directors have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 1956, for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

(iv) that the Directors have prepared the annual accounts for the year ended on 31st March 2006, on a going concern basis.

INDUSTRIAL AND PERSONNEL RELATIONS:

The relationship between the management and the staff continued to be cordial.

PARTICULARS OF EMPLOYEES:

In pursuance of the provisions of Section 217 (2A) of the Companies Act, 1956, read with Companies (Particulars of Employees) Rules, 1975, the Directors are to report that no employee was in receipt of emoluments as provided in the said Section.

ADDITIONAL INFORMATION AS REQUIRED U/S 217 (1) (e) OF THE COMPANIES ACT. 1956:

The statement giving particulars with respect to conservation of energy, technology absorption and foreign exchange earnings and outgo, as required under Section. 217(1)(e) of the Companies Act, 1956, read with the Companies (Disclosure of Particulars in the Report of Board of Directors) Rules, 1988, is enclosed as Annexure 1

CORPORATE GOVERNANCE:

The report on Corporate Governance and Management Discussion Analysis Report are annexed hereto as Annexure-2 & 3 respectively and they form part of Directors Report.

ACKNOWLEDGMENTS:

Your Directors express their appreciation for the support received from the Bank, Government Authorities, Customers, Vendors and Shareholders.

For and on behalf of the Board of Directors of Starchik Specia lities Limited Sd/- Sd/- Place: Hyderabad (Harbans Singh) (Amarjyot Singh) Date: 29-06-2006 Managing Director Director

ANNEXURE-I

INFORMATION PURSUANT TO THE COMPANIES (DISCLOSURE OF PARTICULARS IN THE REPORT OF BOARD OF DIRECTORS RULES, 1988

a) Energy Conservation Measures taken: Not Applicable as Company has not carried out any business activity during the year.

b) Additional investments and proposals, if any, being implemented for reduction of consumption of energy : Nil

c) Impact of the measures at (a) and (b) above for reduction of energy consumption and consequent impact on the cost of production of goods : Not Applicable

FORM-A

FORM FOR DISCLOSURE OF PARTICULARS WITH RESPECT TO CONSERVATION OF ENERGY

Particulars 2005-06 2004-05

A. POWER AND FUEL CONSUMPTION:

Electricity

a) Purchased : Units (KWH) Nil Nil

Total Amount (Rs.)

Rate/Unit (Rs.)

b) Own Generation

Through diesel generator: Units (KWH Nil Nil

Units per litre of diesel oil

Cost per Unit (Rs.)

B. CONSUMPTION PER UNIT OF PRODUCTION:

Electricity consumption Per kg of dressed/frozen chicken Nil Nil

FORM B

DISCLOSURE OF PARTICULARS WITH RESPECT TO TECHNOLOGY ABSORPTION

A. RESEARCH AND DEVELOPMENT (R&D): Not Applicable

B. TECHNOLOGY ABSORPTION, ADAPTATION AND INNOVATION-Not Applicable

FORM-C FOREIGN EXCHANGE EARNINGS AND OUTGO

(in Rupees) Particulars 2005-06 2004-05

a) Foreign Exchange earned (Recovery of old dues from Sundry Debtors) Nil 16,22,895

b) Foreign Exchange used Nil Nil

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Mar 31, 2005

Your Directors hereby present the Thirteenth Annual Report of the Company together with the Audited Accounts of your Company for the year ended 31st March 2005.

FINANCIAL RESULTS:

Your Companys performance during 2004-2005 is summarized below:

(Rs. in lakhs)

SI. Particulars 2004-05 2003-04

1. Sales 1752.09 1396.06 2. Other Income 15.77 17.50 3. Total Income (1+2) 1767.86 1413.56 4. Operating Expenditure 1803.15 1390.67 5. Profit / Loss before depreciation and Misc. Exp written off (3-4) -35.29 22.89 6. Depreciation 19.21 22.36 7. Misc. Exp. written off 4.76 7.82 8. Net Profit (+) / Loss (-) [5-(6+7)] -59.26 -7.29

Inspite of Companys tremendous efforts, your Company could not convince the consumers to change their preference to frozen chicken. Due to the lack of demand, the Company found it difficult to sustain in the market and the management decided to close the operations of the plant from the year 2001 -02. With the view to curtail the costs and the losses your Company carried on only trading activity since 2001-02. However, the margins being low in trading activity, it could barely cover the operational costs. It is found that it is not feasible to carry the trading activity and hence the Company has stopped its trading activity also w.e.f. 1st April 2005.

DIVIDEND :

Due to the losses incurred by the Company, Board of Directors is unable to recommend any dividend for the year 2004-05.

ONETIME SETTLEMENT :

The Company has negotiated and settled the dues with State Bank of India

DIRECTORS:

In accordance with provisions of Section 256 of the Companies Act, 1956 and the Articles of Association, Shri Sarabjyot Singh, Director of the Company, retires by rotation at the ensuing Annual General Meeting and being eligible offers himself for re-appointment.

Shri Sarabjyot Singh has resigned from the position of the Whole Time Director w.e.f. 31st March, 2005 and is continuing as the Director of the Company.

DIRECTORS RESPONSIBILITY STATEMENT:

The Directors confirm:

(i) that in the preparation of the Annual Accounts for the year ended on 31 st March 2005, the applicable accounting standards have been followed and that no material departures have been made from the same;

(ii) that the Directors have selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the company as on 31 st March 2005 and of the loss for that period;

(iii) that the Directors have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act. 1956, for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

(iv) that the Directors have prepared the annual accounts for the year ended on 31st March 2005, on a going concern basis.

FIXED DEPOSITS:

Your Company has not accepted any deposits from the public during the year.

INDUSTRIAL AND PERSONNEL RELATIONS:

The relationship between the management and the staff is cordial.

PARTICULARS OF EMPLOYEES:

In pursuance of the provisions of Section 217 (2A) of the Companies Act, 1956, read with Companies (Particulars of Employees) Rules, 1975, the Directors are to report that no employee was in receipt of emoluments as provided in the said Section.

AUDITORS:

M/s. Venugopal & Chenoy, Chartered Accountants, the present statutory auditors of the Company hold office until the conclusion of the forthcoming Annual General Meeting and are eligible for re-appointment. The Company has received confirmation from them to the effect that their appointment, if made, would be within the prescribed limits under Section 224 (1B) of the Companies Act, 1956.

ADDITIONAL INFOBMATK3N AS REQUIRED U/S 217m (1) OF THE COMPANIES ACT. 19S6:

The statement giving particulars with respect to conservation of energy, technology absorption and foreign exchange earnings and outgo, as required under Section 217(1 )(e) of the Companies Act, 1956, read with the Companies (Disclosure of Particulars in the Report of Board of Directors) Rules, 1988, is enclosed as Annexure 1

CORPORATE GOVERNANCE:

The report on Corporate Governance and Management Discussion Analysis Report are annexed hereto as Annexure - 2 & 3 respectively and they form part of Directors Report.

ACKNOWLEDGMENTS:

four Directors express their appreciation for the support received from the Bank, Government Authorities, Customers Vendors and Shareholders.

For and on behalf of the Board of Directors of Starchik Specialities Limited

Sd/- Sd/- Place: Hyderabad (Harbans Singh) (Sarabjyot Singh) Date : 30-06-2005 Managing Director Director

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Mar 31, 2004

The Directors' hereby present the Twelfth Annual Report of the Company together with the Audited Accounts of your Company for the year ended 31st March 2004. FINANCIAL RESULTS: The Company's performance during 2003-2004 is summarized below: (Rs. in lakhs) Particulars 2003-04 2002-03 Sales 1396.06 841.83

Other income 17.50 0.06

Total Income 1413.56 841.89

Operating Expenditure 1390.79 839.59

Profit/Loss before depreciation and Misc. Exp written off 22.89 2.30

Depreciation

Misc. Exp. written off 7.82 7.82

Net Profit(+)/Loss(-) -7.42 -28.00 During the year under review, your company achieved a turnover of Rs.1396.06 Lakhs for the year ended 31st March 2004 as against Rs. 841.89 Lakhs during 2002-03 resulting in an increase of 66% over the last year. Even the loss for the year has decreased to Rs.7.29 Lakhs, as against Rs.28 Lakhs last year. Though the Company has to stop its manufacturing activity, it is meeting its overheads through trading activity operating on very negligible margins. DIVIDEND: Due to the losses incurred by the Company, Board of Directors is unable to recommend any dividend for the year 2003-04. DIRECTORS: In accordance with provisions of Section 256 of the Companies Act, 1956 and the Articles of Association, Shri R.P Vaidya. Director of the Company, retires by rotation at the ensuing Annual General Meeting and being eligible offers himself for re-appointment. Shri Sarabjyot Singh has been re-appointed as the Whole Time Director w.e.f. 31st May, 2004 and members' approval for the same is sought for in the ensuing Annual General Meeting. DIRECTORS' RESPONSIBILITY STATEMENT: The Directors confirm: - (i) That in the preparation of the Annual Accounts, the applicable accounting standards have been followed and that no material departures have been made from the same;

(ii) That the Directors have selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the company at the end of the financial year and of the loss for that period; (iii) That the Directors have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 1956, for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities; (iv) That the Directors have prepared the annual accounts on a going concern basis. FIXED DEPOSITS: The Company has not accepted any deposits from the public during the year. INDUSTRIAL AND PERSONNEL RELATIONS: The relationship between the management and the staff is cordial. PARTICULARS OF EMPLOYEES: In pursuance of the provisions of Section 217 (2A) of the Companies Act, 1950, read with Companies (Particulars of Employees) Rules, 1975, the Directors are to report that no employee was in receipt of emoluments as provided in the said Section. AUDITORS: M/s. Venugopal & Chenoy, Chartered Accountants, the present statutory auditors of the Company hold office until the conclusion of the forthcoming Annual General Meeting and are eligible for their re-appointment. The Company has received confirmation from them to the effect that their appointment, if made, would be within the prescribed limits under Section 224 (1B) of the Companies Act. 1956. ADDITIONAL INFORMATION AS REQUIRED U/S 217(1)(e) OF THE COMPANIES ACT, 1956: The statement giving. particulars with respect to conservation of energy, technology absorption and foreign exchange earnings and outgo, as required under Section 217(1)(e) of the Companies Act, 1958, read with the Companies (Disclosure of Particulars in the Report of Board of Directors) Rules, 1988, is annexed hereto and forms part of the report. (Annexure -1) CORPORATE GOVERNANCE: The report on Corporate Governance and Management Discussion Analysis Report are annexed hereto as Annexure-2 & 3 respectively and they form part of Directors' Report. ACKNOWLEDGEMENTS : The Directors express their appreciation for the support received from the Bank, Government Authorities, Customers and Vendors. Your Directors wish to thank the Shareholders for the confidence reposed in the Company. The Directors also wish to place on record their appreciation for the hard work and commitment of the staff of the Company. for and on behalf of the Board of Directors of Starchik Specialities Limited Sd/- Sd/- Place: Hyderabad (Harbans Singh) (Sarabjyot Singh) Date: 02-07-2004 Managing Director Director ANNEXURE-1 INFORMATION PURSUANT TO THE COMPANIES (DISCLOSURE OF PARTICULARS IN THE REPORT OF BOARD OF DIRECTORS) RULES, 1988 - a) Energy Conservation Measures taken: Not Applicable as presently engaged only in trading activity. b) Additional investments and proposals, if any, being implemented for reduction of consumption of energy : Nil c) Impact of the measures at (a) and (b) above for reduction of energy consumption and consequent impact on the cost of production of goods : Not Applicable

FORM-B DISCLOSURE OF PARTICULARS WITH RESPECT TO TECHNOLOGY ABSORPTION A. RESEARCH AND DEVELOPMENT (R&D): Not Applicable B. TECHNOLOGY ABSORPTION, ADAPTATION AND INNOVATION: Not Applicable FORM - C FOREIGN EXCHANGE EARNINGS AND OUTGO (in Rupees) Particulars 2003-04 2002-03 a) Foreign Exchange earned (Recovery of old dues from Sundry Debtors) 16,22,895 Nil b) Foreign Exchange used Nil Nil

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Mar 31, 2003

Your Directors have pleasure in presenting the Eleventh Annual Report of the Company together with the Audited Accounts of your Company for the year ended 31st March 2003.

FINANCIAL RESULTS:

Your Companys performance during 2002-2003 is summarized below:

(Rs. in lakhs) Sl.No Particulars 2002-03 2001-02

1. Sales 841.83 413.19

2. Other Income 0.06 25.50

3. Total Income (1+2) 841.89 438.69

4. Operating Expenditure 839.59 488.56

5. Profit/Loss before depreciation and Misc. Exp written off (3-4) 2.30 -49.87

6. Depreciation 22.48 23.28

7. Misc. Exp. written off 7.82 7.82

8. Net Profit (+)/Loss (-) 28.00 -80.97

During the year under review, your company achieved turnover of Rs. 841.83 lakhs for the year ended 31et March 2003 as against Rs. 413.19 lakhs during 2001-02 an increase by 103.74%. The Net Loss for 2002-03 declined by 65.42% and stood at Rs. 28.00 lakhs as against a loss of Rs. 80.97 lakhs for the year 2001-02.

As it has been informed, the Company has closed the operations of its plant and is now only undertaking trading activity in live birds. In the trading activity the volumes are very high and hence the increase in the turnover, but the margins being low, hence the loss. However the Company has reduced its overheads to the bare minimum and therefore not incurring any cash losses.

The industry scenario for dressed and frozen chicken is still at a very nascent stage and the preference of the consumer is still for the conventional fresh chicken. Hence it is decided that the Company will continue only to undertake trading activity till such time the market demand for frozen and dressed chicken increases and it would be economically viable to operate the plant.

DIVIDEND:

Due to the losses incurred by the Company, Board of Directors is unable to recommend any dividend for the year 2002-03.

DELISTING OF SHARES

The Company proposes to delist its equity shares from the Stock Exchanges at Hyderabad, Chennai and Delhi, during the current year. Necessary resolution has been proposed for the approval of the members. However, Companys shares will continue to be listed on Mumbai Stock Exchange.

DIRECTORS:

In accordance with provisions of Section 256 of the Companies Act, 1956 and the Articles of Association, Shri Amarjyot Singh, Director of the Company, retires by rotation at the ensuing Annual General Meeting and being eligible offers himself for re-appointment.

Mr. Narendra Luther, Chairman resigned from the Board during the year under review. Your Board of Directors places on record their appreciation for his enormous contribution to the Company during his tenure as Chairman and Director. No other director has been appointed in his place.

DIRECTORS RESPONSIBILITY STATEMENT:

The Directors confirm:

(i) that in the preparation of the Annual Accounts, the applicable accounting standards have been followed and that no material departures have been made from the same;

(ii) that the Directors have selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the company at the end of the financial year and of the profit/loss of the Company for that periods

(iii) that the Directors have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 1956, for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

(iv) that the Directors have prepared the annual accounting a going concern basis.

FIXED DEPOSITS:

Your Company has not accepted any deposits from the public during the year.

INDUSTRIAL AND PERSONNEL RELATIONS:

Last year, the processing plant was closed. The services of all employees of the Company were terminated and all terminal benefits that were due to them have been paid. There were no disputes with any of the employees and the industrial relations till the end have remained cordial.

PARTICULARS OF EMPLOYEES:

In pursuance of the provisions of Section 217 (2A) of the Companies Act, 1956, read with Companies (Particulars of Employees) Rules, 1975, the Directors are to report that no employee was in receipt of emoluments as provided in the said Section.

AUDITORS:

M/s.Venugopal & Chenoy, Chartered Accountants, the present statutory auditors of the Company hold office until the conclusion of the forthcoming Annual General Meeting and are eligible for their re-appointment. The Company has received confirmation from them to the effect that their appointment, if made, would be within the prescribed limits under Section 224 (1B) of the Companies Act, 1956.

ADDITIONAL INFORMATION AS REQUIRED U/S 217 (1) (e) OF THE COMPANIES ACT. 1956:

The statement giving particulars with respect to conservation of energy, technology absorption and foreign exchange earnings and outgo, as required under Section 217(1)(e) of the Companies Act, 1956, read with the Companies (Disclosure of Particulars in the Report of Board of Directors) Rules, 1988, is annexed hereto and forms part of the report (Annexure-1).

CORPORATE GOVERNANCE:

The report on Corporate Governance and Management Discussion Analysis Report are annexed hereto as Annexure - 2 & 3 respectively and they form part of Directors Report.

ACKNOWLEDGMENTS:

Your Directors express their appreciation for the support received from the Bank, Government Authorities, Customers and Vendors. Your director wish to thank the Shareholders for the confidence reposed in the Company.

Your directors also wish to place on record their appreciation for the hard work and commitment of the executives, staff and workers of the Company at all levels.

On behalf of the Board of Directors Place: Hyderabad (R.P. VAIDYA) Date: 30.06.2003 Chairman

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Mar 31, 2002

Your Directors have pleasure in presenting the Tenth Annual Report along with the audited accounts of your Company for the year ended 31st March 2002.

FINANCIAL RESULTS

Your Companys performance during 2001-2002 is summarized below:

(Rs. in Lakhs) 2001-02 2000-01

Sales 413.19 467.73

Other Income 25.50 20.26

Total Income 438.69 487.99

Total Expenditure 519.66 558.26

Profit/(loss) before Taxation Tax (80.97) (70.27)

Net Profit/(Loss) After Tax (80.97) (70.27)

Your company achieved a sales turnover of Rs. 413.19 lakhs during 2001-02 as against Rs. 467.73 lakhs during 2000-01, a decrease of 11.66%. The Net Loss for 2001-02 was Rs. 80.97 lakhs as against a loss of Rs. 70.27 lakhs for the year 2000-01.

PERFORMANCE

Our experience over the last 7 years has shown that the concept of plant-processed and frozen chicken has not yet been accepted by the public at large. Because of that the survival of processing units became extremely difficult and the processing plants that were started, are either incurring heavy losses or have closed down their operations. In order to avoid further operational losses and depletion in the capital, your Directors had no choice but to close down the plant. The company had put in a lot of efforts in creating awareness about the quality of its products but it did not succeed in changing the customers preference from fresh product to processed frozen product.

Your Company has also closed down all its Chicken World outlets consequential to the closure of the operations.

Your Company is presently only engaged in the trading of live broiler birds.

DIVIDEND

In the circumstances stated above, your Board of Directors have not declared any dividend for the year 2001-02.

DIRECTORS

In accordance with provisions of the Companies Act. 1956 and the Articles of Association, Shri R P Vaidya Director of the Company, retires by rotation at the Tenth Annual General Meeting and being eligible offers himself for re-appointment.

Mr. R. Srinivasan has resigned as director from the Board during the year under review. Your Directors place on record their appreciation for the support provided by him during his tenure as director. No director is appointed in his place.

AUDIT COMMITTEE

The audit committee met four times during the financial year 2001-02 for considering the quarterly, half yearly and the annual accounts of the Company as per the provisions of the Companies Act, 1956.

DIRECTORS RESPONSIBILITY STATEMENT

The Directors confirm:

a) that in the preparation of the annual accounts, the applicable accounting standards have been followed and that no material departures have been made from the same.

b) That they have selected such accounting: policies and applied them consistently and made judgements and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the company at the end of the financial year and of the loss of the for that period.

c) That they have taken proper and sufficient care tor the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 1956 tor safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities.

d) That they have prepared the annual accounts on-a-going concern basis.

REPLIES TO AUDITORS REPORT

In reply to Item 4 (xv) of the Auditors Report since the Company has closed its plant and the Company is curtailing its operations it could not set up Internal Audit System.

In reply to Item 4(xvii) of the Auditors Report due to financial crunch the company could not meet its liabilities in time. However, as on 31st March, 2002 there were no outstanding dues payable to ESI and PF.

FIXED DEPOSITS

Your Company has not accepted any deposits from the public during the year.

INDUSTRIAL AND PERSONNEL RELATIONS

During the year under review, the processing plant was closed. The services of all employees of the Company were terminated and all terminal benefits due to them have been paid. There were no disputes with any of the employees and the industrial relations till the end have remained cordial.

PARTICULARS OF EMPLOYEES

Information pursuant to Section 217 (2A) of the Companies Act, 1956, read with Companies (Particulars of Employees) Rules, 1975 is Nil.

AUDITORS

M/s. Venugopal & Chenoy, Chartered Accountants, who are now Auditors of the Company, retire at the ensuing Annual General Meeting and are eligible for re-appointment. The requisite Certificate to the effect that the reappointment if made, will be within the limit specified in Section 224 (1-B) of the Companies Act, 1956 has been received from them.

PARTICULARS REGARDING ENERGY CONSERVATION, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUT GO

The statement giving particulars with respect to conservation of energy, technology absorption and foreign exchange earnings and outgo, as required under Section 217(1)(e) of the Companies Act, 1956, read with the Companies (Disclosure of Particulars in the Report of Board of Directors) Rules, 1988, is annexed hereto and forms part of the report.

CORPORATE GOVERNANCE

Your Company is taking all steps to implement the requirements of Corporate Governance under Clause 49 of the Listing Agreement which becomes mandatory during the financial year 2002-2003 at a date not later 31st March, 2003.

ACKNOWLEDGMENTS

Your directors express their gratitude to the shareholders of the Company for the confidence reposed in the Company.

Your directors gratefully acknowledge the valuable support, guidance and help provided by the State Bank of India and other Government department/agencies.

Your directors wish to place on record their appreciation of the hard work, dedication and commitment of the staff at all levels.

ANNEXURE TO THE DIRECTORS REPORT

INFORMATION PURSUANT TO THE COMPANIES (DISCLOSURE OF PARTICULARS IN THE REPORT OF BOARD OF DIRECTOR (S) RULES, 1988

a) Energy Conservation Measures taken: The Company is engaged in the continuous process for energy conservation.

b) Additional investments and proposals, if any, being implemented for reduction of consumption of energy: Negligible

c) Impact of the measures at (a) and (b) above for reduction of energy consumption and consequent impact on the cost of production of goods: The energy conservation measures have resulted in energy saving

d) Total Energy consumption and energy consumption per unit of production as per Form A which is detailed below:

FORM B DISCLOSURE OF PARTICULARS WITH RESPECT TO TECHNOLOGY ABSORPTION

A. RESEARCH AND DEVELOPMENT (R&D): Not Applicable

B. TECHNOLOGY ABSORPTION, ADAPTATION AND INNOVATION

1. Efforts made: Nil

2. Benefits derived: Nil

3. Imported Technology: None

FORM - C

FOREIGN EXCHANGE EARNINGS AND OUTGO (In Rupees) 2001-2002 2000-2001

a) Foreign Exchange earned Nil Nil

b) Foreign Exchange used:

i) CIF value of import (Capital goods and raw materials) - -

ii) Travel - -

iii) Legal Fee 40,073 1,66,135

On behalf of the Board of Directors

Place: Hyderabad NARENDRA LUTHER Date: 1-07-2002 Chairman

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Mar 31, 2001

Your Director's have pleasure in presenting the Ninth Annual Report along with the audited accounts of your Company for the year ended 31st March 2001.

FINANCIAL RESULTS

Your company's performance during 2000-01 is summarized below :

(Rs. in lakhs)

Particulars 2000-2001 1999-2000 Sales 467.73 631.82 Other Income 20.26 3.16 Total Income 487.99 634.98 Profit/loss before Taxation (70.27) (119.56) Tax - - Net Profit After Tax (70.27) (119.56)

Your Company achieved a turnover of Rs.467.73 lakhs during 2000-01 as against a turnover of Rs. 631.82 lakhs during 1999-00,a decrease of 25.97%. However there was a reduction in the net loss for 2000-01 of Rs. 119.56 lakhs for the year 1999-2000, the loss for 2000-01 was Rs.70.27 lakhs

PERFORMANCE

The year 2000-01 saw a slow down of the market growth reflecting poor performance of the Company. Your Company adopted innovative methods of marketing its products, but in-spite off all efforts, we were not able to compete with the unorganised sectorand also change the preference of the consumer from conventional product to frozen product.

Your Company, has in order to control the input cost, taken on lease farms for rearing its own birds. This step of backward integration will help the Company to improve its margins which at present are very low.

Now, that the Company is rearing most of the birds needed, the input cost will be stable and the Company will not be affected by the volatility of the poultry market. The Company has now set up a marketing team to focus on institutional sales. With the new marketing policies of the Company, it is anticipated that the sales volume will improve in the current financial year.

CHICKEN WORLD

The Company's retail business continues to be uncertain. The Company has diversified into sale of other meat and fish products at its retail outlets in order to make the same viable and reduce the operational losses.

DIVIDEND

As the operations have resulted in losses, the Directors have decided not to recommend any dividend for the year 2000-01.

DIRECTORS

As per the provisions of the Companies Act,1956 and the Articles of Association, Shri Narendra Luther and Shri R. Srinivasan, Directors of the Company, retire by rotation at the Ninth Annual General Meeting and being eligible offer themselves for re-appointment.

AUDIT COMMITTEE

As per Sec. 292A of the Companies Act 1956 (Act), the Board has constituted an audit committee comprising of Mr. R.P.Vaidya, Mr.R. Srinivasan and Mr. Sarabjyot Singh, with Mr. R.P.Vaidya as its Chairman. The role, terms of reference and the authority and powers of the Audit Committee are in conformity with the Act.

RESPONSIBILITY STATEMENT

The Directors confirm :

a) that in the preparation of the annual accounts, the applicable accounting standards have been followed and that no material departures have been made from the same.

b) that they have selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the financial year and of the profit and loss account for that period

c) that they have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act 1956, for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities :

d) that they have prepared the annual accounts on a going concern basis.

FIXED DEPOSITS

Your Company has not accepted any deposits from the public during the year.

DEPOSITORY SYSTEM

As the members are aware, your Company's shares are tradable compulsorily in electronic form and your Company has established connectivity with both the depositories, i.e., National Securities Depository Limited (NSDL) and Central Depository Services (India) Limited (CDSL). In view of the numerous advantages offered by the Depository System, members are requested to avail of the facility of dematerialisation of the Company's shares on either of the Depositories as aforesaid. The Company has also made arrangements for simultaneous dematerialisation of share certificates lodged for transfer.

INDUSTRIAL AND PERSONNEL RELATIONS

The industrial relations have been cordial.

PARTICULARS OF EMPLOYEES

The Company had no employee on its payroll covered under Section 217(2A) of the Companies Act, 1956 and therefore the said Section is not applicable.

AUDITORS

M/s. Venugopal & Chenoy, Chartered Accountants, the Statutory Auditors of the Company, retire at the ensuing Annual General Meeting and are eligible for re-appointment.

QUALIFICATION

In reply to Item 7(xvii) of the Auditor's Report, the Company, due to the acute financial crunch could not meet the liabilities. Howfever all necessary steps are being taken to deposit the amounts at the earliest.

PARTICULARS REGARDING ENERGY CONSERVATION, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO

The statement giving particulars with respect to conservation of energy, technology absorption and foreign exchange earnings under Section 217(1)(e) of the Companies Act, 1956, read with the Companies (Disclosure of Particulars in the Report of Board of Directors) Rules, 1988, is annexed hereto and forms part of the report.

ACKNOWLEDGMENTS

Your directors express their gratitude to the shareholders of the Company for the confidence reposed in the Company.

Your directors gratefully acknowledge the valuable support, guidance and help provided by the State Bank of India and other Government department/agencies.

Your directors wish to place on record their appreciation of the hard work, dedication and commitment of the staff at all levels.

On behalf of the Board of Directors NARENDRA LUTHER Place : Hyderabad Chairman Date : 30.6.2001

A. RESEARCH AND DEVELOPMENT (R&D)

Not Applicable

B. TECHNOLOGY ABSORPTION ADAPTATION AND

1. Efforts made :

Dressing of chicken does,not require any technology except fof freezing the same at the right temperatures.

2. Benefits derived :

Processing of chicken with stress on freezing the freshness, prevents bacteria formation thereby giving a longer shelf life and also gives a hygienic product.

3. Imported Technology : None

FORM - C

FOREIGN EXCHANGE EARNINGS AND OUTGO

(in Rupees)

Partculars 2000-2001 1999-2000

a) Foreign Exchange earned Nil Nil b) Foreign Exchange used : i) CIF value of import (Capital goods - - and raw material) ii) Travel - 25,372 iii) Legal Fee 1,66,135 -

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Mar 31, 2000

The Director's have pleasure in presenting the Eighth Annual Report along with the audited accounts of the Company for the year ended 31st March, 2000.

GENERAL

The potential for growth of the poultry is enormous because of the fact that in India the per capita consumption of chicken meat is about 1 kg per annum as against 30 kg per annum in developed countries. Despite the growth potential, the processing industry has been in a severe crisis for the last two years on account of the increased cost of raw material and lack of support from the Government for export of poultry products. In contrast to this, in developed countries such exports are highly subsidized.

In the Vision 2020 document of A.P. a growth rate of 9% p.a is envisaged. This will be achieved by giving, special thrust to nineteenth primary growth engines. Poultry is one of them. In spite of that there has been no evidence so far of any specifications in that regard. It is indeed ironical that in spite of the proclaimed commitment of the government to this sector, it remains in revenue crisis today.

FINANCIAL RESULTS

The company's performance during 1999-2000 is summarized below : (Rs. in Lakhs)

Particulars 1999-2000 1998-99

Sales 631.82 793.96

Other Income 3.16 30.84

Total Income 634.98 824.80

Profit/(Loss) before tax (119.56) 6.74

Tax -- --

Net Profit/(Loss) after Tax (119.56) 6.74

The product-wise turnover is an under :

Dressed Chicken 538.10 671.74

Hatching Eggs, Day old Chicks & others(exports) 12.31 56.07

Marinated & other products 22.98 8.94

Live Birds 58.34 57.20

The company achieved a sales turnover of Rs.631.82 lakhs during 1999-00 as against Rs. 793.96 lakhs during 1998-99, a decrease of 20.42%. The net loss for 1999-2000 was Rs. 119.56 lakhs against a profit of Rs. 6.74 lakhs for the year 1998-99.

PERFORMANCE

The performance of the Company has been poor and far below the budgeted turnovers & profitability. The reason for the poor performance is the customer resistance to processed chicken as against fresh chicken. Though the processed poultry has distinct hygiene & nutritional advantage, the consumer prejudice against it has yet to be overcome. The Company has put in lot of efforts in creating awareness about the quality of its products but it has not been able to change the customers' perception of the freshness of product.

Further the operational cost has increased due to the increase in raw material prices and personnel costs adding to the losses.

CHICKEN WORLD

The company has its own 17 retail outlets in additional to 6 franchise outlets in the twin cities under the name "Chicken World" exclusively for "Starchik" branded - fresh, frozen, marinated products and pickles. The Company has started it's own restaurant during the current financial year but the response has been lower than the expectation. In spite of the efforts made the sales from the company owned shops and franchises have been less than 50% of the budgeted sales. The revenues generated were not enough even to meet the operating costs due to which the Company has incurred huge losses.

DIVIDEND

Considering the loss suffered by the Company, the Board of Directors have decided not to declare any dividend for the year 1999-2000.

DIRECTORS

In accordance with provisions of the Companies Act, 1956 and the Articles of Association, Shri Amarjyot Singh and Shri R.P. Vaidya, Directors of the Company, retire by rotation at the ensuing Annual General Meeting.

FIXED DEPOSITS

The Company has not accepted any deposits from the public during the year.

INDUSTRIAL AND PERSONNEL RELATIONS

The industrial relations have been cordial.

PARTICULARS OF EMPLOYEES

Information pursuant to Section 217(2A) of the Companies Act, 1956 read with Companies (Particulars of Employees) Rules 1975 is Nil.

AUDITORS

M/s. Venugopal & Chenoy, Chartered Accountants, Auditors of the Company, retire at the ensuing Annual General Meeting and are eligible for re-appointment.

PARTICULARS REGARDING ENERGY CONSERVATION, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO

The statement giving particulars with respect to conservation of energy, technology absorption and foreign exchange earnings and outgo, as required under Section 217(1)(e) of the Companies Act, 1956, read with the Companies (Disclosure of Particulars in the Report of Board of Directors) Rules, 1988, is annexed hereto and forms part of the report.

FORM FOR DISCLOSURE OF PARTICULARS WITH RESPECT TO TECHNOLOGY ABSORPTION

A. RESEARCH AND DEVELOPMENT (R&D) Not Applicable

B. TECHNOLOGY ABSORPTION, ADAPTATION AND INNOVATION

Efforts made :

Dressing of chicken does not require any technology except for freezing the same at the right temperatures.

Benefits Derived :

Processing of chicken with stores on freezing the freshness, prevents bacteria formation thereby giving a longer shelf life and also gives a hygienic product.

Imported Technology : None

FORM - C

FOREIGN EXCHANGE EARNINGS AND OUTGO

Particulars 1999-2000 1998-99

a) Foreign Exchange earned Nil 4122080

b) Foreign Exchange used :

i) CIF value of import -- 99034 (Capital goods and raw material)

ii) Travel 25,372 140454

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Mar 31, 1999

The Directors have pleasure in presenting the Seventh Annual Report along with the audited accounts of the Company for the year ended 31st March 1999.

GENERAL

The economic recession continued during 1998-99 resulting in difficult market conditions in terms of trade and commerce.

FINANCIAL RESULTS

The Company's performance during 1998-99 is summarised below : (Rs. in lakhs)

Particulars 1998-99 1997-98

Sales 793.96 694.28 Other Income 30.84 14.08 Total Income 824.80 708.36 Profit before Taxation 6.74 31.88 Tax -- 0.82 Net Profit After Tax 6.74 31.06 The product-wise turnover is as under : Dressed Chicken 671.7 528.58 Hatching Eggs, Day Old Chicks & Others (exports) 55.44 161.16 Marinated & other products 9.58 3.18 Live Birds 57.20 1.36

The company achieved a sales turnover of Rs. 793.96 lakhs during 1998-99 as against Rs. 694.28 lakhs during 1997-98, an increase of 14.36%. However, the net profit declined to Rs. 6.74 lakhs for the year 1998-99 from Rs. 31.06 lakhs during 1997-98.

PERFORMANCE

Despite difficult market conditions, the sale of dressed chicken and other products of the Company increased by 38.52%. However, the frequent fluctuations in the input cost which ranged between Rs. 44.25 and Rs. 24.60 per kilogram and decline in the export turnover has adversely affected the profitability of the Company. Hence, the Company could earn only marginal profits.

CHICKEN WORLD

The Company has opened its own 15 retail outlets in the twin cities in the name "Chicken World" exclusively for Starchik branded - fresh, frozen, marinated products and pickles. It proposes to have more such outlets in and around the twin cities and start its own restaurant, during the current year. As the institutional sales are more or less constant, efforts are now being made to improve its retail business through these outlets, supported by a good advertisement campaign. It is also the Company's endeavour to increase the sale of its value-added products, from its retail outlets. We are hopeful that the investments made in the chain of Chicken World retail outlets will ensure increase in capacity utilization. reduction in fixed overheads and higher profits and help in achieving the targets of the current financial year.

EXPORTS

The Company had planned for an export of Rs. 231.15 Lacs. However, during the period, international trading conditions were difficult, and several countries recorded negative growth. The South East Asian crisis led to a global economic slow down. The international competitors cut down on the prices of their products and also extended longer credit periods to their customers. The Company was not able to match the same and as a result the export turnover declined from Rs. 161.16 lakhs during the previous year to Rs. 55.44 lakhs during 1998-99.

DIVIDEND

The Board of Directors, after considering the profits earned, has recommended not to declare any dividend for the year 1998-99.

YEAR 2000

The Company has addressed the Y2k complain for its operations. Most of the hardware & software in use have been determined to be Y2k complain. The Company has also addressed the issue of systems breakdown/failure due to Y2k problem with adequate contingency plans.

DIRECTORS

In accordance with provisions of the Companies Act, 1956 and the Articles of Association, Shri Narendra Luther, Chairman and Shri N R Ganti, Director retire by rotation at the ensuing Annual General Meeting.

Shri S.P. Manchanda has resigned from the Directors of the Company. The Board wishes to place on record their appreciation for valuable contribution and guidance in the Company's progress rendered by Shri S.P. Manchanda during his tenure on the Board and wishes him best of luck for the future.

Shri R. Srinivasan who is the Management and marketing consultant and having rich experience was appointed an Additional Director w.e.f. 31.05.1999 to hold office till the conclusion of the ensuing Annual General Meeting.

Notice has been received from a member, pursuant to Section 257 of the Companies Act, 1956, proposing the appointment of Shri R. Srinivasan as Director of the Company at the ensuing Annual General Meeting.

LISTING

The Company's shares are listed on the Hyderabad and Mumbai Stock Exchanges and the listing fees for the current financial year 1999-2000 has been paid. In the Sixth Annual General Meeting held on 30th September, 1998, the Company had obtained members approval for Voluntary Delisting of Shares from Delhi and Chennai Stock Exchanges for the reasons mentioned below :

1. There has been a substantial increase (more than 100%) in the listing fees and to reduce the financial burden on the Company.

2. There have been no transactions of shares in the said Stock Exchanges from the past three years.

3. The number of shareholders in each of the Delhi and Chennai Stock Exchanges do not exceed 150 out of the total 6000 (approximately), of which 75% shares have been held by the relatives and friends of Promoters.

FIXED DEPOSITS

The Company has not accepted any deposits from the public during the year.

INDUSTRIAL AND PERSONNEL RELATIONS

The industrial relations have been cordial.

PARTICULARS OF EMPLOYEES

Information pursuant to Section 217(2A) of the Companies Act, 1956, read with Companies (Particulars of Employees) Rules, 1975 is Nil.

AUDITORS

M/s. Venugopal & Chenoy, Chartered Accountants, who are now Auditors of the Company, retire at the ensuing Annual General Meeting and are eligible for re-appointment.

PARTICULARS REGARDING ENERGY CONSERVATION, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO

The statement giving particulars with respect to conservation of energy, technology absorption and foreign exchange earnings and outgo, as required under Section 217(1)(e) of the Companies Act, 1956, read with the Companies (Disclosure of Particulars in the Report of Board of Directors) Rules, 1988, is annexed hereto and forms part of the report.

ANNEXURE TO THE DIRECTORS' REPORT

INFORMATION PURSUANT TO THE COMPANIES (DISCLOSURE OF PARTICULARS IN THE REPORT OF BOARD OF DIRECTORS) RULES, 1988

FORM FOR DISCLOSURE OF PARTICULARS WITH RESPECT TO TECHNOLOGY ABSORPTION

A. RESEARCH AND DEVELOPMENT (R&D)

Not Applicable

B. TECHNOLOGY ABSORPTION, ADAPTATION AND INNOVATION

1. Efforts made :

Dressing of chicken does not require any technology except for freezing the same at the right temperatures.

2. Benefits derived :

Processing of chicken with stress on freezing the freshness, prevents bacteria formation thereby giving a longer shelf life and also gives a hygienic product.

3. Imported Technology : None

FORM - C

FOREIGN EXCHANGE EARNINGS AND OUTGO

(in Rupees)

Particulars 1998-99 1997-98 a. Foreign Exchange earned 4122080 12592733

b. Foreign Exchange used i. CIF value of import 79034 11891 (Capital goods and raw material) ii. Travel 140454 434323

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Mar 31, 1998

The Directors have pleasure in presenting the Sixth Annual Report alongwith the audited accounts of the Company for the year ended 31st March, 1998.

GENERAL

Politically, the country witnessed a change in the Central Government. Recession continued in the economy. In the field of commerce and trade, unstable market situation continued. The sensex registered a sharp drop.

The overall situation has resulted in slowing down of industrial growth. The poultry industry and in particular the processing units continued to face problems of increase in the cost of inputs.

The new budget has imposed central excise duty on the poultry meat and processed chicken. This will hit the poultry processing industry and will further hinder its growth potential. We have represented the matter to the Finance Minister for review and we are hopeful that this duty will be withdrawn keeping in mind that chicken processing industry is still in the stage of infancy.

FINANCIAL RESULTS

The company's performance during 1997-98 is summarised below :

(Rs. in lakhs)

1997-98 1996-97

Total Income 708.36 495.60

Profit before Taxation 32.00 3.39

Tax 0.86 0.44

Net Profit after Tax 31.15 2.95

The product-wise turnover is as under :

Dressed Chicken 531.58 333.40

Live Birds 1.36 -

Feed Ingredients - 19.87

Hatching Eggs 161.16 113.53

Others 14.26 28.80

The Company has achieved a sales turnover of Rs. 708.36 lakhs during 1997-98 which is an increase of 43% over the previous year. The net profit after taxation has increased from Rs. 2.95 lakhs during 1996-97 to Rs. 31.15 lakhs during 1997-98 an increase of 955%.

PERFORMANCE

During the year 1997-98 the main thrust of the Company was to create awareness about the advantages of the mechanically processed chicken and this was successfully achieved through a scheme of door to door delivery which was introduced for its Hyderabad customers last year.

It is the Company's continued endeavor to widen its customer base and develop innovative marketing techniques for its products and thereby overcome the infrastructural shortcomings faced by the processing units. Keeping this in view, and to develop the concept for sale of branded Starchik Products, it is desirable to own a chain of retail outlets. The Company has made a beginning by opening its first retail outlet (Chicken World) at Barkatpura, Hyderabad and we hope to open few more shortly in the twin cities of Hyderabad and Secunderabad.

The Company has already established its brand image at institutional level and now with the focused methods it is set to establish the same in the retail business. We expect to achieve our target for the current financial year.

EXPORTS

The Company continued its efforts in exports and achieved a turnover of Rs. 161.16 lakhs (US$ 440302) in the year 1997-98 as against Rs. 113.53 lakhs (US$ 320757) in the year 1996-97 making for an increase of 42%.

DIVIDEND

The Board of Directors have after taking into consideration the profit for the year of Rs. 31.15 lakhs and reserves of Rs. 36.46 lakhs recommended the maiden dividend of 5% for the year 1997-98.

DIRECTORS

In accordance with provisions of the Companies Act, 1956 and the Articles of Association, Shri Amarjyot Singh, Director, retires by rotation at the Sixth Annual General Meeting and being eligible offers himself for reappointment.

FIXED DEPOSITS

The Company has not accepted any deposits from the public during the year.

INDUSTRIAL AND PERSONNEL RELATIONS

The industrial relations have been cordial.

PARTICULARS OF EMPLOYEES

Information pursuant to Section 217 (2A) of the Companies Act, 1956, read with Companies (Particulars of Employees) Rules, 1975 is Nil.

AUDITORS

M/s. Venugopal & Chenoy, Chartered Accountants, who are now Auditors of the Company, retire at the ensuing Annual General Meeting.

PARTICULARS REGARDING ENERGY CONSERVATION, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO

The statement giving particulars with respect to conservation of energy, technology absorption and foreign exchange earnings and outgo, as required under Section 217(1)(e) of the Companies Act, 1956, read with the Companies (Disclosure of Particulars in the Report of-Board of Directors) Rules, 1988, is annexed hereto and forms part of the report.

FORM FOR DISCLOSURE OF PARTICULARS WITH RESPECT TO TECHNOLOGY ABSORPTION

A. RESEARCH AND DEVELOPMENT (R & D)

Not Applicable

B. TECHNOLOGY ABSORPTION, ADAPTATION AND INNOVATION

1. Efforts made :

Dressing of chicken does not require any technology except for freezing the same at the right temperatures.

2. Benefits derived :

Processing of chicken with stress on freezing the freshness, prevents bacteria formation thereby giving a longer shelf life and also gives a hygienic product.

3. Imported Technology : None

FORM-C

FOREIGN EXCHANGE EARNINGS AND OUTGO

(in Rupees)

1997-98 1996-97

a) Foreign Exchange earned 1,25,92,733 85,59,332

b) Foreign Exchange used :

i) CIF value of import 11,891 - (Capital goods and raw materials)

ii) Travel 4,34,323 1,99,039

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Mar 31, 1997

The Directors have pleasure in presenting the Fifth Annual Report alongwith the audited accounts of the Company for the year ended 31st March, 1997.

GENERAL

The Indian economy, due to the relatively fluid political scenario, witnessed a slower market growth during the financial year 1996-97. The economic reforms programme continued, but the poultry industry in general and the processing units in particular continued to face the same problems of non-availability of proper infrastructure such as cold chains and storage points.

Though there has been a marginal increase in the turnover during the year under review, in comparison to the previous year, the sale of dressed chicken has increased by 144.58%.

PERFORMANCE

The main thrust of the Company during 1996-97 was to create an awareness amongst the consumer that mechanically processed chicken was more hygienic and convenient to handle than the conventionally available product. Extensive consumer research has provided useful insights into the development and application of relevant technologies in product formulation and refrigerated product handling, which have begun to set new standards in terms of quality of the delivered product.

The efforts of the Company have resulted in a solid customer base in Hyderabad, Madras and Goa and the Company hopes to consolidate its position as a leader in the field of processed chicken by the turn of the century.

As stated in the previous report, we continue to face the problem of non-availability of storage points, but in order to tap the opportunities available the Company has adopted an innovative marketing technique of "door to door delivery". In just about 3 months over 700 members have enrolled themselves on the Starchik Club. They enjoy the privilege of getting variety of chicken of the best quality at their doorstep. The success of this technique is proved by the addition of approximately 300 members per month and by the end of the current financial year we hope to have approximately 3000 members. The ultimate aim is to sell not chicken, but "Starchik", and that, hopefully, will be achieved in a couple of years.

The Company has already consolidated its brand image at institutional level, who now prefer processed chicken over the conventionally available product.

FRY AND SERVE

In today's world, time is valuable. Consequently, there is an increase in the demand for fast and ready to eat foods. The Company, in its efforts to keep pace with the needs of its consumers have made investments to set up facilities to further process its chicken into ready-to-eat foods and have test launched the products such as "chicken samosas", "chicken nuggets", "chicken burgers" etc. under the brand "Fry and Serve".

With focused efforts on innovation, the Company's products are expected to be successful.

EXPORTS

The Company achieved an export turnover of Rs.113.53 lakhs during 1996-97 as against Rs.11.41 lakhs in the previous year.

In an effort to establish its brand name abroad, the Company has undertaken the export of hatching eggs to the Sultanate of Oman and the United Arab Emirates. Based on the market survey conducted in these two countries, it is estimated that there is a lot of potential demand for hatching eggs. The Company on a conservative estimate hopes to export around 500 boxes per month in the current financial year. The Company is slowly making a place for itself as an exporter of high quality hatching eggs.

DIVIDEND

The directors have recommended to retain the profits and hence no dividend has been recommended for the financial year under consideration.

DIRECTORS

In accordance with provisions of the Companies Act, 1956 and the Articles of Association, Shri R.P. Vaidya and Shri S.P. Manchanda, Directors, retire by rotation at the Fifth Annual General Meeting and being eligible offer themselves for reappointment.

FIXED DEPOSITS

The Company has not accepted any deposits from the public during the year.

INDUSTRIAL AND PERSONNEL RELATIONS

The industrial relations have been cordial.

PARTICULARS OF EMPLOYEES

Information pursuant to Section 217(2A) of the Companies Act, 1956, read with Companies (Particulars of Employees) Rules, 1975 is Nil.

AUDITORS

M/s. Venugopal & Chenoy, Chartered Accountants, who are now Auditors of the Company, retire at the ensuing Annual General Meeting and are eligible for reappointment.

PARTICULARS REGARDING ENERGY CONSERVATION, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO

The statement giving particulars with respect to conservation of energy, technology absorption and foreign exchange earnings and outgo, as required under Section 217(1)(e) of the Companies Act, 1956 read with the Companies (Disclosure of Particulars in the Report of Board of Directors) Rules, 1988, is annexed hereto and forms part of the report.

FORM FOR DISCLOSURE OF PARTICULARS WITH RESPECT TO TECHNOLOGY ABSORPTION

A. RESEARCH AND DEVELOPMENT (R & D)

Not Applicable

B. TECHNOLOGY ABSORPTION, ADAPTATION AND INNOVATION

1. Efforts made :

Dressing of chicken does not require any technology except for freezing the same at the right temperatures.

2. Benefits derived :

Processing of chicken with stress on freezing the freshness, prevents bacteria formation thereby giving a longer shelf life and also gives a hygienic product.

3. Imported Technology : None

FORM-C

FOREIGN EXCHANGE EARNINGS AND OUTGO

(in Rupees)

1996-97 1995-96

a) Foreign Exchange earned 85,59,332 8,55,275

b) Foreign Exchange used :

i) CIF value of import -- 3,51,131 (Capital goods and raw materials) ii) Travel 1,99,039 --

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Mar 31, 1996

Your Directors have pleasure in presenting the Fourth Annual Report alongwith the audited accounts of your Company for the year ended 31st March 1996.

FINANCIAL RESULTS

The Company has made a turn over of Rs. 460.63 lakhs as against 364.18 lakhs during 1995-96. The gross profit is Rs. 85.53 lakhs and net profit after depreciation is Rs. 1.31 lakhs as per the table below:

For 1995-96 For 1994-95 (Rs. in Lakhs) (Rs. in Lakhs)

Total Income 460.63 364.18

Gross Profit 85.53 81.31

Depreciation 84.22 51.26

Net Profit 1.31 30.05

Depreciation for the year ended 31.3.96 is Rs. 84.22 lakh as against Rs. 51.26 lakhs in the previous year ended 31.3.95, resulting in decrease in the net profits.

POULTRY INDUSTRY

During the last three decades, the Indian Poultry Industry has be transformed at an incredible pace from an age-old backyard farming to the most sophisticate industrial sector adopting automation in feed and managemental practices.

Starting in 1970's, the rearing of broiler has made much headway. Since then from a negligible output of 30 million units in 1980 to 500 million units in 1996, the broiler industry is growing approximately @ 20% every year. The industry passed through a nightmarish period of recession in 1972, the only year in which the annual production dropped. However, on the whole there has been a steady growth and increase in competence to deal with the problems. Despite this growth, India lags far behind in terms of per capita chicken consumption which is one of the lowest in the world - being 700 gms per annum against international consumption of 7200 gms per annum. However, in a developing economy like India the poultry industry is expected to grow. The following are the important favorable factors supporting this optimism:

a) The country's economy is on the threshold of a quantum growth. The per capita income will also increase and so will the consumer demand for quality product.

b) Reduced availability has put other higher-priced meats like mutton and fish out of the reach of the average consumer. They are expected to be replaced by chicken.

c) There is reason to believe that the number of non-vegetarians is increasing. Generally, the "first meat" that a vegetarian experiments with is chicken.

d) The advantage of health factor in 'white meat' like chicken over red meat is slowly but surely making its impact.

Keeping in view the recommendations of the National Institute of Nutrition it is estimated that in year 2010, the requirement will be 9.1 billion kgs, for poultry meat, while the production will be 3.04 billion kgs. This points to a substantial gap between demand and supply and indicate the potential for growth of poultry in the current decade.

PROCESSING

Though we are marching towards 21st century with a fast growing economy marked by new automobiles, high speed computers and cellular phones, processing of poultry meat is in a primitive stage.

Mechanical processing of broilers started in 1986 with the opening of the first poultry processing plant in India. There was also considerable expectations about the increase in demand for processed broilers sold in poly packs. Today there are five processing plants in India with an installed capacity of 100,000 birds only. Of this capacity, only 50% is presently being utilized. The total volume of poultry production in the country is 500 million units per annum which amounts to a consumption of 1.37 million per day. Out of this processed poultry is 50,000 which is only 3.6% of the total production. Out of this, approximately 90% is being consumed by institutions which are relying on regular supplies throughout the year at a contracted prices.

Currently the five poultry processing units process and sell less than 4% birds of the total chicken consumption. This is far below the anticipated volume because the cold chain is not yet developed to the desirable extent. Retail distribution is also facing the same difficulty because of non availability of storage points. The shop keeper do not like to keep chicken in a common deep-freezer, for fear of offending the susceptibilities of the vegetarian customers.

Manual slaughtering at convenient place offers the consumers - both individual and institutions - apparently a fresh product at economical prices. Though they believe mechanical slaughtering is hygienic, the market is yet to accept that properly frozen product is better than conventionally available product. Hence, the focus now, should be shifted to convincing the consumer as to the quality in the daily diet and in accepting the processed chicken as part of their daily menu.

For the sound growth of our Company, proper marketing channels and sales promotion to stimulate the demand are vital. A success story that illustrates this truth is that of America's Tyson Foods, the world's leading poultry producer. It markets approximately 26 million chicken every week through its 63 processing plants. It does business with 80% of the American Fast-Food Restaurants. Today it makes chicken in 3,000 different ways. As Don Tyson, the founder-chairman says "The problem wasn't raising chickens; it was selling them." He found that further processing enhanced the value of poultry products. Thus he was able to get away form selling the whole chicken by weight at prices that varied from day to day to value-added products sold by numbers or by pieces at predetermined prices.

One has only to look at the changing market scenario. With a faster pace of life and more house wives taking up employment, the time required for buying a live bird for a meal would become an unaffordable luxury. Some other important favorable factors are:

1. The consumer is looking for a quick, easy-to-prepare meal.

2. The housewife would like to go down to the neighbourhood shop to procure her foodstuffs. She would buy more chicken if it is easily and conveniently available.

3. With modern families getting smaller, a whole chicken is not required for a meal. Chicken would be consumed more frequently if available in small and convenient packs.

4. Large automated chicken processing plants have been set up in India as the first step in bringing about a change in the pattern of consumption. The advertising done by these companies will not only promote the use of processed chicken products but also give a fillip to the consumption of chicken in general. The processing Industry has reached a stage at which it will look only upwards. The necessary infrastructure has to be created. To overcome constraints, there is a need to tap the keen interest shown by multi-nationals and Fast-Food companies in the processing and in marketing of dressed birds and processed chicken delicacies. This will pave the way for a sure and sustained growth of the processing industry.

PROJECTIONS V/S ACTUALS

The Company's achievements during the financial year under consideration as against the projections given in the prospectus is as under:

Rs. in lakhs

Particulars Projections Actuals

Total Income 2209.34 460.63

Profit after tax 286.47 1.31

Dividend 15% Nil

The reasons for the variations are:

a) The concept of processed frozen chicken is yet to be accepted fully by the Indian Market. Hence despite the promise of the revolution of the processed chicken it is far behind anticipated volume. There are no technical flaws but the inadequacy of supporting infrastructure like cold storage points makes wide spread distribution difficult.

b) There was an unusual increase in the cost of raw material. The price rise was of the order of 30% during the year against normal rise of 15%. As a result of that all the processing units in the country suffered.

c) Although the turn over has been more than last year, the net profit is low because of higher depreciation.

DIVIDEND

Your directors have recommended to retain the profits and hence no dividend has been recommended for the financial year under consideration.

FORM 'B'

FORM FOR DISCLOSURE OF PARTICULARS WITH RESPECT TO TECHNOLOGY ABSORPTION

A. RESEARCH AND DEVELOPMENT (R&D)

Not Applicable

B. TECHNOLOGY ABSORPTION, ADOPTION AND INNOVATION

1. Efforts made :

Dressing of chicken does not require any technology except for freezing the same at the right temperatures.

2. Benefits derived

Processing of chicken with stress on freezing the freshness prevents bacteria formation thereby giving a longer shelf life and also gives a hygienic product.

3. Imported Technology:

None

FORM - C

FOREIGN EXCHANGE EARNINGS AND OUTGO

1995-96 1994-95 (Rupees) (Rupees)

a) Foreign Exchange earned 855275 956924

b) Foreign Exchange used:

i) CIF value of import 351131 Nil (Capital goods and raw materials)

ii) Travel - 106490

iii) Others (Technical Know-how Fees) Nil Nil

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Mar 31, 1995

Your Directors have pleasure in presenting the third Annual Report along with the audited accounts of your Company for the year ended 31st March 1995.

THE PROJECT

Your company started the project for the processing of chicken at Kesoram Village, Chevella Mandal, R.R. District. It is out pleasure to inform you that the commercial production of its modern semi automatic plant has started from March 1, 1995. The commercial production was launched on June 23, 1995.

As per the projections given in the prospectus, the Company has planned to start production from August 1, 1994. However as the public issue was delayed due to unfavorable market conditions for about six months, the whole project implementation was delayed. Because of this the working results have been below what was projected.

However, with support from all of your the production has now started in full swing and our products are well received by hotels, restaurants and other bulk chicken outlets, fast-food centers etc. We have signed an agreements with the finest chains of star hotels in the country, including Oberoi and Taj group of hotels and fast-food chain including Nirulas in Delhi. The products are very well received by the consumers.

PROJECTIONS v/s ACTUALS

The company's achievements during the financial year under consideration against the projections as given in the prospectus is as under:

Rs. in lakhs

Particular Projections Actuals

Total Income 1979.96 364.18

Profit after tax 279.76 30.05

Dividend Nil Nil

The reasons for the variations are:

a) The Public issue which was originally planned for January 1994 was delayed for about six months due to unfavorable market conditions.

b) Due to (a) above the plant went into commercial production on 1st March 1995 against the projected schedule of August 1994.

DIVIDEND

As indicated in the prospectus your directors have recommended to retain the profits and hence no dividend has, been recommended for the financial year under considerations.