We have the honour of presenting our twenty third Annual Report and Audited Financial
Statements for the year ended 31 March, 2012.
Overview of Financial Performance
The Standalone and Consolidated financial results of the Company for year ended 31st
March, 2012 are as follows:
28.39 % of the paid up capital of the Company. The open offer commenced on 28th March,
2012 and Mrs Deepti Agarwal and Mr. Nirmal Kumar Bardiya would be classified as Promoters
of the Company w.e.f. 28th March, 2012.
During the year under review, your Company has been awarded "Rajasthan State
Award` for the year 2008-09 on account of export excellence in the category of
(Rs. in Lacs)
|Revenue from Operation and Other Income
|Less: Operating Cost
|Operating Profit / PBDIT
|Less: Depreciation & Amortization
|Profit Before Taxes
|Less: Provision for Taxes
|Net Profit After Tax but before Exceptional Items
|Less : Exceptional Items - (Provision Bad Debts)
|Profit After Tax and Exceptional Item
|Dividend on Preference Share Capital
|Proposed Dividend on Equity Shares
|Tax on Dividend
|Profit for the year
In view of the accumulated losses brought forward, your Directors do not recommend any
dividend for the financial year 2011-12.
Pursuant to Securities and Exchange Board of India (Substantial Acquisition of Shares
and Takeovers) Regulations 2011, Mrs. Deepti Agarwal, Mr Rahimullah, Mr. Nirmal Kumar
Bardiya and M/s Shlvram Properties Pvt. Ltd. have made an open offer for the acquisition
of 90,00,000 Equity Shares of Rs. 10 each, representing precious & semi-precious
stones by Government of Rajasthan.
Consolidated Financial Statements
Consolidated Financial Statements are prepared in accordance with the Accounting
Standard - 21 issued by Institute of Chartered Accountants of India (ICAI) and Listing
Agreement, as prescribed by SEBI and the same have been provided in the Annual Report of
The Ministry of Corporate Affairs (MCA) vide general circular no, 2/2011 has granted
general exemption to all Companies under Section 212(8) of the Companies Act 1956 with
respect to not attachment of the documents required under Section 212(1) of the said act,
subject to compliance of certain conditions. Your company has complied with alt the
conditions as stipulated in the said circular, Hence, balance sheet, profit & loss
account and other documents of the subsidiary companies arc not being attached with
balance sheet of the Company. The statement pursuant to Section 212 of the Companies Act,
1956 containing key financials of the Company`s subsidiaries is included in this Annual
The Company will make available the annual accounts of the subsidiaries to any member
of the company who may be interested in obtaining the same. The annual accounts of the
subsidiary companies are also available for inspection by any member. The same shall also
be kept for inspection by any shareholder at the head office of the holding company and of
the subsidiary companies concerned.
The Company has the following operating Subsidiaries:
a) STS Jewels Inc., USA, a 100 per cent subsidiary is engaged in the wholesale segment
and selling jewellery to the departmental stores, TV channels and others In USA.
b) STS Gems Limited. Hong Kong, a 100 per cent subsidiary is engaged in outsourced
manufacturing for the group and marketing of Jewellery across the globe.
c) The Jewellery Channel Ltd. UK (TJC UK), a wholly owned step down subsidiary of
Valibhav Gems Limited, is engaged in marketing of Jewellery through electronic media and
operates a dedicated 20 hours Jewellery TV shopping channel and Internet Jewellery
shopping website In the UK.
d) Liquidation Channel, USA (LC USA), a wholly owned step down subsidiary of Vaibhav
Gems Limited is engaged in marketing of jewellery through electronic media and operates a
dedicated 24 hours jewellery TV shopping channel and Internet Jewelery shopping website in
Corporate Social Responsibility
Your Company believes that as a responsible corporate citizen, it must address the
needs of underprivileged and be committed to serving them. Your Company is keen to fulfil
its social responsibility by being actively involved in a variety of public service
projects. In line with this, the Company has donated to various social institutions
(NGO`s) in the field of education and health care.
During the year under review, your Company has not accepted any public deposits under
Section 58A of the Companies Act, 1956 read with Companies (Acceptance of Deposit) Rules,
During the year under review. Mr. Nirmal Kumar Bardiya who was an Independent Non
Executive Director on the Board of the Company, is no longer to be considered as
Independent Director since 28th March, 2012, being the date of Public announcement, for
the acquisition of 14,26,500 Equity Shares, constituting 4.50 % of the paid up capital of
the Company. Further, Mrs. Sheela Agarwal and Mr Mltha Lal Mehta retire by rotation at the
ensuing Annual General Meeting and being eligible, offer themselves for re-appointment.
As required by Clause 49 of Listing Agreement, a brief resume and other particulars of
Directors retiring by rotation is provided in the Annual Report
Auditors and Auditors` Report
M/s Haribhakti & Company, Chartered Accountants, Mumbai and M/s B. Khosla &
Co., Chartered Accountants, Jaipur, Joint Statutory Auditors of the Company hold office
until the conclusion of ensuing Annual General Meeting and being eligible, have offered
themselves for re-appointment and they have confirmed that the said re-appointment will be
in conformity with the limit prescribed under Section 224(1B) of the Companies Act 1956.
There are no reservations, qualifications or adverse remarks contained in the Auditors`
Report attached to Balance Sheet as at 31st March, 2012 Information referred in Auditors
Report are self explanatory and don`t call fee any further comments.
Directors` Responsibility Statement
Pursuant to the provisions of Section 217 (2AA) of the Companies Ad, 1966 with respect
to the Directors` responsibility statement it is hereby confirmed that:
I. In the preparation of the annual accounts for the financial year ended 31st March,
2012, the applicable accounting standards have been followed along with proper explanation
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
profit and loss account 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, 1956,
for safeguarding the assets of the company and for preventing and detecting fraud and
IV. The Directors have prepared the annual accounts on a going concern basis.
Transfer of unclaimed dividend to Investor Education and Protection Fund (IEPF}
Pursuant to the provisions of Section 205(A) of the Companies Act. 1956 the Company has
transferred Rs. 27,856 on 24th November, 2011, which was lying in unpaid dividend account
of the Company for a period of sever years, to Investor Education and Protection Fund
(IEPF) established by the Central Government under Section 205(C) of the said act.
Industrial relations continue to be peaceful and cordial at all levels. The Directors
are pleased to record their appreciation for the valuable contribution by the employees of
the Company at all levels.
Employee Stock Option Plan (As Amended) - 2006
Pursuant to the approval of members accorded at last Annual General Meeting held on
30th September, 2011, the Company has changed the name of VGL ESOP -2006 to VGL ESOP (As
Amended) - 2006 in accordance with Securities Exchange Board of India (Employee Stock
Option Scheme and Employees Stock Purchase Scheme) Guidelines, 1999. Under this scheme, a
corpus of new 7,50,000 Stock Options was created for grant to the eligible employees. Each
option is convertible into one fully paid up Equity Share of Rs. 10 each.
Details required to be provided under the Securities Exchange Board of India (Employee
Stock Option Scheme and Employees Stock Purchase Scheme) Guidelines, 1999are set out in
Annexure I to this Report.
Management Discussion and Analysis Report
Management Discussion and Analysis Report for the year under review, as required under
Clause 49 of the Listing Agreement, forms part of this Annual Report
Your Company believes in sound practices of Good Corporate Governance. Transparency,
Accountability, Responsibility are the fundamentals guiding principles for all decisions,
transactions and policy matters of the Company.
A Report on Corporate Governance along with a certificate from the Statutory Auditors`
of the Company regarding compliance of conditions of Corporate Governance as stipulated
under Clause 49 of the Listing Agreement forms part of this Annual Report.
Particulars of Employees
Information as required under provisions of Section 217 (2A) of the Companies Act,
1956, read with Companies (Particulars of Employees) Rules, 1975 as amended, are required
to be attached to this report However, as per provisions of Section 219(1)(b)(iv) of the
Companies Act, 1956, the Annual Report is being sent to Shareholders excluding the
statement of particulars under Section 217 (2A). The Statement is open for inspection at
the registered office of the Company during working hours and a copy of the same may be
obtained by writing to the Company at its registered office.
Conservation of Energy, Technology Absorption and Foreign Exchange Earnings and outgo
Information in accordance with the provisions of Section 217(1)(e) of the Companies Act
1956, read with the Compares (Disclosure of Particulars in the Report of Board of
Directors) Rules, 1988.
A. Conservation of Energy
The operations of your Company are not energy-intensive. However, significant measures
are taken to reduce energy consumption by using energy efficient equipments. We regularly
evaluate and use new energy efficient technologies and make necessary investment in these
equipments to make our infrastructure more energy-efficient.
B Technology Absorption
The Company has not carried out any specific research and development activities. Your
Company possesses an In-house research and development wing, which is continuously working
towards more efficient jewellery production, improved processes and better designs. Your
Company has not imported any technology for its manufacturing process and therefore, the
question of adaptation/absorption does not arise.
C. Foreign Exchange Earnings and Outgo
The information on foreign exchange earnings and outgo is furnished in the notes to
Your Directors take this opportunity to thank and place on record their sincere
appreciation of the wholehearted support extended by the Company`s bankers, shareholders,
customers, vendors, auditors and various statutory authorities. The Directors also wish to
thank all the employees for their continued contribution, hard work and dedication
throughout the year.
||For and on behalf of the Board of Directors
|Date : 13th August, 2012
ANNEXURE I: VGL ESOP (AS AMENDED) - 2006
||Item of Disclosure
||Total options granted and outstanding as at 31st March, 2012 are 5,46,324.
||The Pricing Formula
||The exercise price shall be the market price which would be the latest available
dosing price of the shares on the stock exchange, which records the highest trading volume
of the Company`s equity shares on the date prior to the date of meeting of the
Compensation Committee at which the options are granted.
||The total number of shares arising as a result of exercise of option
||Options lapsed (reissuable)
||Variation of terms of options
||Money realized by exercise of options
||Total number of options in force
||Employee wise details of options granted:
||(i) Senior Managers! Personnel:
||(ii) Any other employee who receives a grant in any one year of option amounting to 5%
or more of option granted during that year
||(iii) Identified employees who were granted option, during any one year, equal to or
exceeding 1 % of the issued capital (excluding out-standing warrants and conversions) of
the company at the time of grant;
||Diluted Earnings Per Share (EPS) pursuant to issue of shares on exercise of option
calculated in accordance with Accounting Standard (AS) 20 `Earnings Per Share`
||As disclosed in the Financial Statements of the Company