1

CHAPTER 1
INTRODUCTION
Rajesh Exports Company History. Rajesh Exports Limited (REL) is the world's
largest gold company and world's only fully integrated entity across the entire
value chain of gold from mining till its own retail brand. Rajesh Exports has set
up 81 retail jewellery showrooms under the brand name of SHUBH Jewellers.
Rajesh Exports Limited was incorporated in 1989. The company is a global leader
in the Gold business.
REL is headquartered in Bangalore, India with operations spread across the world.
The only company in the world with presence across the entire value chain of
Gold from refining to retailing.
Largest processor of gold in the world, REL processes 35% of gold produced in
the world.
Largest exporter of gold products from India.
Lowest cost gold jewellery producer in the world.
World's finest gold products manufacturing and R&D facilities at various places,
main facility being at Bangalore, India and the main refining facility being at
Balerna, Switzerland.
Extensive marketing network covering entire India and the major gold markets of
the world.
REL has one of the world's largest active jewellery design database of 29000
designs.
REL has developed several innovative technologies and processes in the
manufacture of Jewellery.
REL is a professionally managed company committed to the highest standards of
corporate governance.
 2

Industry scenario
1.1 Micro Scenario
The company has broken into the Fortune 500 list July 21 was a red-letter day for
Rajesh Mehta, the 52-year-old Executive Chairman of Bengaluru-headquartered
Rajesh Exports Ltd.
At 4 o’clock in the evening, he was informed that the small company he had set
up in 1989 with a 500 sq. ft jewellery store along with his brother Prashant, had
entered the hallowed turf of Fortune 500 companies at 423{+r}{+d} place.
“There was always a silent confidence deep inside, that we will emerge as one of
the best companies in the world someday. So, it’s a dream come true for me,” said
Mehta, who begins work at 8.30 a.m. and winds up past midnight at 12.30 p.m.,
every day.
Asked what goal he is looking to achieve next, he said: “I want to make Rajesh
Exports one of the most respected companies in the world with our products,
systems, work culture and institution.”
Now, more than ever, we must be more responsible, diligent and clean up our
systems to make them so robust that they can compete with any international
system. “Microsoft, Google and Apple are respected not for their size or the
money they make but, for their innovations, systems and clean work culture,”
elaborated Mehta.
Vertically integrated player
After its acquisition of Switzerland-based gold refinery Valcambi last July, Rajesh
Exports became one of the largest vertically integrated gold players in the world,
from mines, refinery and R&D to manufacturing and consumer retailing.

Micro Exporters Policy (MEP)

The Small Exporter's Policy is basically the Standard Policy, incorporating certain
improvements in terms of cover, in order to encourage small exporters to obtain
and operate freely without the different type of risks like Political and
Commercial. It is issued to exporters whose anticipated export turnover for the
period of one year does not exceed INR 1 crore.
 3

Scheme Benefits & Highlights

1. A 12-month insurance policy for small exporters.
2. Premium payable will be determined on the basis of projected exports on an
annual basis subject to a minimum premium of INR 5000 for the policy period.
No claim bonus in the premium rate is granted every year at the rate of 5%.
3. For shipments covered under the Small Exporter's Policy ECGC will pay claims
to the extent of 95% where the loss is due to commercial risks and 100% if the
loss is caused by any of the political risks.
Type of risks covered
I. Risks covered on the overseas buyers:
 Insolvency of the buyer.
 Failure of the buyer to make the payment due within a specified period,
normally 2 months from the due date.
 Buyer’s failure to accept the goods, subject to certain conditions.
II .Risks covered on the L/c opening Bank
 Insolvency of the L/c Opening bank
 Failure of the L/C opening bank to make the payment due within a
specified period normally 2 months from the due date.
b. Political Risks
 Imposition of restriction by the Government of the buyer’s country or any
Government action, which may block or delay the transfer of payment
made by the buyer.
 War, civil war, revolution or civil disturbances in the buyer’s country.
New import restrictions or cancellation of a valid import license in buyer’s
country.
 Interruption or diversion of voyage outside India resulting in payment of
additional freight or insurance charges which cannot be recovered from the
buyer.
 Any other cause of loss occurring outside India not normally insured by
general insurers, and beyond the control of both the exporter and the
buyer.

1.2 Macro Scenario

Rajesh Exports Gold Trader to International Jewellery Retailer Problem Statement
 4

The problem statement refers to the concise description of the issues that needs to
be addressed. It identifies the issues or gap between the current and desired type
of the organization, and thus requires to be stated in order for the management to
look for change. The main idea of the problem statement is to answer the 5 w’s
that include the answering who, what, where and why, to allow the organization to
resolve the problem, by stating it in clearly in 2 to 3 lines.

In recent period, the problems statement is widely used by the firms to allow the
management to execute the improvement process or identify the loopholes that are
affecting the overall performance or profitability of the company. Moreover, the
problem statement allows the management to trim down the symptoms of the
problem an organization is facing and look on to the real problem that is causing
the damage to any specific aspect of the company.

Basically, developing a Rajesh Exports Gold Trader to International Jewellery

Retailer problem statement is an extensive process and requires the proper
brainstorming of the teams in order to identify the underlying loopholes or
inefficiencies within the organization. Also, it offers the specific insights to the
management in understanding and looking at the factors that have been hidden
from the management sight, effecting the performance slowly and gradually.

Apart from this, while developing the problem statement, it is important for the
Problem statement to be clear and concise. Such is due to the fact, that it allows
the management, stakeholder to quickly understand the finding and look on the
main problem, rather getting entangled in the symptoms of the problem. The
conciseness of the problem statement is the key, as it allows the reader to quickly
understand the issue.

Moreover, clarity of the Rajesh Exports Gold Trader to International Jewellery

Retailer problem statement is important to maintain, in order to avoid the
misunderstanding between the shareholders and stakeholders. The clear problem
statement is developed by stating the factors and the operations getting effected
and its overall impact on the organization specific the areas, such as Profitability,
sales or brand equity. Also, the purpose of the problem statement is to describe the
external environment and its effect on the overall organization in short and long-
 5

term. Moreover, it also delineates the impact of such changing factors on the
users, and other stakeholders.

Many times, under the case analysis, the purpose of the problem statement is to
improvise the current state of the organization through pursuing innovation or
other changes. hence ins uh cases, the direct problem is no the ultimate
organization factors but the process implementation that is needed to be in place,
in order to bring change, avoiding the upcoming risk and hence sustaining the
competitive edge in the market (Spradlin, 2012).

Furthermore, the establishment of the problem statement, allows the organization

and the management teams to work in a specified direction. Such is important in
order to allow the organization to move in a specified direction, reducing the
chances of deviating from the actual path. Also, it offers the benchmark to match
the desired condition of the organization, hence putting the efforts of the team in
the right direction.

Yet, it is important to note that, the good problem statement does not delineate the
solution or the symptoms of the problem, but it clearly states the gap that lies
within the organization. Moreover, it is also determined, that a clear problem
statement is half of the solution, hence it is important to state the problem
correctly.

In addition, the problem statement is a group process, and hence requires a detail
understanding of the issues the organization may be facing, by all members in the
team. This will allow the team to develop a better solution plan addressing all the
factors and considering all the risk associated with it.
Perhaps, stating the problem statement is not just writing the fact, it’s more about
the factors that are effecting or may affect the organization in long term, therefore,
while developing the problem statement, the factors such as human resource skills
innovation, technology, change resistance are considered, that have a direct effect
on the organization or is hidden cause of the problem. It is important to note, that
the problem statement can cover tangible or intangible issue, but it needs to have a
clear relationship with the organization end goal.
 6

In addition, while stating the problem statement, the aim of the management is to
see the mission and vision of the company and then analyse the current state of the
organization, such also allow the right identification of the problem and the lead
to the development of concrete problem statement.

All in all, the problem statement gives a direction to the organization in

understanding the right solution path and development of the solution sets in order
to overcome the current issues that are deteriorating the organizational
performance or productivity. Perhaps, while writ the problem statement, it is
important to consider the small factors that are often overlooked such as the
intangible factors that effects the productivity of the organization in the long term.

1.3 Investments made by Rajesh exports

[ source : Wikipedia]
Company : Negotiatus

[source : Wikipedia]
Company : Simple cast
 7

[Source :Wikipedia]
Company: Cloud snap

[Source : Wikipedia ]
Company : SIEMonster

[Source : Wikipedia]
Company: Kinsa

1.3 EXPORT PROMOTION SCHEMES

Foreign Trade Policy 2015-20 and other schemes provide promotional measures
to boost India’s exports with the objective to offset infrastructural inefficiencies
and associated costs involved to provide exporters a level playing field. Brief of
these measures are as under:
1.3.1 Exports from India Scheme

i. Merchandise Exports from India Scheme (MEIS)

 8

Under this scheme, exports of notified goods/ products to notified markets as

listed in Appendix 3B of Handbook of Procedures, are granted freely
transferable duty credit scrips on realized FOB value of exports in free
foreign exchange at specified rate. Such duty credit scrips can be used for
payment of basic custom duties for import of inputs or goods.

Exports of notified goods of FOB value upto Rs 5,00,000 per consignment,

through courier or foreign post office using e-commerce shall be entitled for
MEIS benefit. List of eligible category under MEIS if exported through
using e-commerce platform is available in Appendix 3C.

ii. Service Exports from India Scheme (SEIS)

Service providers of notified services as per Appendix 3D are eligible for
freely transferable duty credit scrip @ 5% of net foreign exchange earned.
1.4 DUTY EXEMPTION & REMISSION SCHEMES
These scheme consists of:-hese schemes enable duty free import of inputs for
export production with.

1.4.1 Advance Authorization Scheme

Under this scheme, duty free import of inputs are allowed, that are physically
incorporated in the export product (after making normal allowance for wastage)
with minimum 15% value addition. Advance Authorization (AA) is issued for
inputs in relation to resultant products as per SION or on the basis of self
declaration, as per procedures of FTP. AA normally have a validity period of 12
months for the purpose of making imports and a period of 18 months for
fulfillment of Export Obligation (EO) from the date of issue. AA is issued either
to a manufacturer exporter or merchant exporter tied to a supporting
manufacturer(s)
1.4.2 Advance Authorization for annual requirement
Exporters having past export performance (in at least preceding two financial
years) shall be entitled for Advance Authorization for Annual requirement. This
shall only be issued for items having SION.
 9

1.4.3 Duty Free Import Authorization (DFIA) Scheme

DFIA is issued to allow duty free import of inputs, with a minimum
value addition requirement of 20%. DFIA shall be exempted only from the
payment of basic customs duty. DFIA shall be issued on post export basis for
products for which SION has been notified. Separate schemes exist for gems
and jewellery sector for which FTP may be referred.

1.4.4 Duty Drawback of Customs

The scheme is administered by Department of Revenue. Under this
scheme products made out of duty paid inputs are first exported and
thereafter refund of duty is claimed in two ways:
i) All Industry Rates : As per Schedule
ii) Brand Rate : As per application on the basis of
data/documents

1.4.5 Interest Euqlisation Scheme (IES)

The Government announced the Interest Equalisation Scheme @ 3%
per annum for Pre and Post Shipment Rupee Export Credit with effect
from 1st April, 2015 for 5 years available to all exports under 416 tariff
lines [at ITC (HS) code of 4 digit] and exports made by Micro, Small &
Medium Enterprises (MS
MEs) across all ITC(HS) codes. With effect from November 2, 2018,
the rate of Interest Equalisation for MSME has been increased to 5%.
The Scheme has also been extended to Merchant Exporters who will
now avail the benefit @ 3% for all exports under 416 tariff lines w.e.f.
January 2, 2019.

1.5 EPCG SCHEME

1.5.1 Zero duty EPCG scheme
Under this scheme import of capital goods at zero custom duty is
allowed for producing quality goods and services to enhance India’s
export competitiveness. Import under EPCG shall be subject to export
obligation equivalent to six times of duty saved in six years. Scheme
 10

also allows indigenous sourcing of capital goods with 25% less export
obligation.
1.5.2 Post Export EPCG Duty Credit Scrip Scheme
A Post Export EPCG Duty Credit Scrip Scheme shall be available for
exporters who intend to import capital goods on full payment of
applicable duty in cash.
1.5.3 EOU/EHTP/STP & BTP SCHEMES
Units undertaking to export their entire production of goods and services may
be set up under this scheme for import/ procurement domestically without
payment of duties. For details of the scheme and benefits available therein FTP
may be required.

1.6 OTHER SCHEMES

1.6.1 Towns of Export Excellence (TEE)
Selected towns producing goods of Rs. 750 crores or more are notified
as TEE on potential for growth in exports and provide financial assistance
under MAI Scheme to recognized Associations.

1.6.2 Market Access Initiative (MAI) Scheme

Under the Scheme, financial assistance is provided for export
promotion activities on focus country, focus product basis to EPCs,
Industry & Trade Associations, etc. The activities are like market
studies/surveys, setting up showroom/warehouse, participation in
international trade fairs, publicity campaigns, brand promotion,
reimbursement of registration charges for pharmaceuticals, testing
charges for engineering products abroad, etc. Details of the Scheme is
available at www.commerce.gov.in

1.6.3 Status Holder Scheme

Upon achieving prescribed export performance, status recognition as
one star Export House, two Star Export House, three star export house,
four star export house and five star export house is accorded to the
eligible applicants as per their export performance. Such Status
 11

Holders are eligible for various non-fiscal privileges as prescribed in

the Foreign Trade Policy.

In addition to the above schemes, facilities like 24X7 customs

clearance, single window in customs, self assessment of customs duty,
prior filing facility of shipping bills etc are available to facilitate
exports.

1.6.4 Gold Card Scheme

The Gold Card Scheme was introduced by the RBI in the year 2004. The Scheme
provides for a credit limit for three years, automatic renewal of credit limit,
additional 20% limit to meet sudden need of exports on account of additional
orders, priority in PCFC, lower charge schedule and fee structure in respect of
services provided by Banks, relaxed norms for security and collateral etc,. A Gold
Card under the Scheme may be issued to all eligible exporters including those in
the small and medium sectors who satisfy the pre-requisite conditions laid by
individual Banks.

1.7 Banking Regulation Governing Exports

Export of Goods and Services from India is governed by clause (a) of sub-section
(1) and sub-section (3) of Section 7 of the Foreign Exchange Management Act
1999 (42 of 1999), read with Notification No. G.S.R. 381(E) dated May 3, 2000
viz. Foreign Exchange Management (Current Account Transactions) Rules, 2000,
further read with 1FEMA Notification No.23(R)/2015-RB dated January 12, 2016.
These Regulations are amended from time to time to incorporate the changes in
the regulatory framework and published through amendment notifications.

Within the contours of the Regulations, Reserve Bank of India also issues
directions to Authorised Persons under Section 11 of the Foreign Exchange
Management Act (FEMA), 1999. These directions lay down the modalities as to
how the foreign exchange business has to be conducted by the Authorised Persons
with their customers/ constituents with a view to implementing the regulations
framed.

Instructions issued on export of goods and services from India have been
compiled in this Master Direction. The list of underlying circulars/ notifications
 12

which form the basis of this Master Direction is furnished in the Appendix.
Reporting instructions can be found in Master Directions on reporting (Master
Direction No. 18 dated January 01, 2016)

It may be noted that, whenever necessary, Reserve Bank shall issue directions to
Authorised Persons through A.P. (DIR Series) Circulars in regard to any change
in the Regulations or the manner in which relative transactions are to be
conducted by the Authorised Persons with their customers/ constituents. The
Master Direction issued herewith shall be amended suitably simultaneously.

1.7.1 Realization and repatriation of proceeds of export of goods / software /

services
It is obligatory on the part of the exporter to realize and repatriate the full value of
goods / software / services to India within a stipulated period from the date of
export, as under:
 It has been decided in consultation with the Government of India that the
period of realization and repatriation of export proceeds shall be nine
months from the date of export for all exporters including Units in Special
Economic Zones (SEZs), Status Holder Exporters, Export Oriented Units
(EOUs), Units in Electronic Hardware Technology Parks (EHTPs),
Software Technology Parks (STPs) & Bio-Technology Parks (BTPs) until
further notice.
 For goods exported to a warehouse established outside India, the proceeds
shall be realized within fifteen months from the date of shipment of goods.

1.7.2 Manner of receipt and payment

(i) The amount representing the full export value of the goods exported shall be
received through an AD Bank in the manner specified in the Foreign Exchange
Management (Manner of Receipt & Payment) Regulations, 2016 notified
vide Notification No. FEMA.14 (R)/2016-RB dated May 02, 2016.

(ii) When payment for goods sold to overseas buyers during their visits is received
in this manner, EDF (duplicate) should be released by the AD Category – I banks
only on receipt of funds in their Nostro account or if the AD Category – I bank
 13

concerned is not the Credit Card servicing bank, on production of a certificate by

the exporter from the Credit Card servicing bank in India to the effect that it has
received the equivalent amount in foreign exchange, AD Category – I banks may
also receive payment for exports made out of India by debit to the credit card of
an importer where the reimbursement from the card issuing bank/ organization
will be received in foreign exchange.

(iii) Processing of export related receipts through Online Payment Gateway

Service Providers (OPGSPs)

Authorised Dealer Category – I (AD Category – I) banks have been allowed to

offer the facility of repatriation of export related remittances by entering into
standing arrangements with Online Payment Gateway Service Providers
(OPGSPs) subject to the following conditions –

 The AD Category-I banks offering this facility shall carry out the due
diligence of the OPGSP.
 This facility shall only be available for export of goods and services of
value not exceeding USD 10,000 (US Dollar ten thousand).
 AD Category-I banks providing such facilities shall open a NOSTRO
collection account for receipt of the export related payments facilitated
through such arrangements. Where the exporters availing of this facility
are required to open notional accounts with the OPGSP, it shall be ensured
that no funds are allowed to be retained in such accounts and all receipts
should be automatically swept and pooled into the NOSTRO collection
account opened by the AD Category-I bank.
 A separate NOSTRO collection account may be maintained for each
OPGSP or the bank should be able to delineate the transactions in the
NOSTRO account of each OPGSP.
 Under this arrangement, the permissible debits to the NOSTRO collection
account are for repatriation of funds representing export proceeds to India
for credit to the exporters’ account, payment of fee/commission to the
OPGSP as per the predetermined rates / frequency/ arrangement; and
charge back to the importer where the exporter has failed in discharging
his obligations under the sale contract.
 14

 The balances held in the NOSTRO collection account shall be repatriated

and credited to the respective exporter's account with a bank in India
immediately on receipt of the confirmation from the importer and, in no
case, later than seven days from the date of credit to the NOSTRO
collection account.
 AD Category -I banks shall satisfy themselves as to the bona-fides of the
transactions and ensure that the purpose codes reported to the Reserve
Bank in the online payment gateways are appropriate.
 AD Category -I banks shall submit all the relevant information relating to
any transaction under this arrangement to the Reserve Bank, as and when
advised to do so.
 Each NOSTRO collection account should be subject to reconciliation and
audit on a quarterly basis.
 Resolution of all payment related complaints of exporters in India shall
remain the responsibility of the OPGSP concerned.
 AD Category-I banks desirous of entering into such an arrangement/s
should report the details of each such arrangement as and when entered
into to the Foreign Exchange Department, Central Office, Reserve Bank of
India, Mumbai.
 4
A start-up can realise the receivables of its overseas subsidiary and
repatriate them through Online Payment Gateway Service Providers
(OPGSPs).

(iv) Settlement System under ACU Mechanism

a) In order to facilitate transactions / settlements, effective January 01, 2009,

participants in the Asian Clearing Union will have the option to settle their
transactions either in ACU Dollar or in ACU Euro. Accordingly, the Asian
Monetary Unit (AMU) shall be denominated as ‘ACU Dollar’ and ‘ACU Euro’
which shall be equivalent in value to one US Dollar and one Euro, respectively.

b) Further, AD Category – I banks are allowed to open and maintain ACU Dollar
and ACU Euro accounts with their correspondent banks in other participating
countries. All eligible payments are required to be settled by the concerned banks
through these accounts.
 15

c) Relaxation from ACU Mechanism- Indo-Myanmar Trade - Trade transactions

with Myanmar can be settled in any freely convertible currency in addition to the
ACU mechanism.

d) In view of the difficulties being experienced by importers/exporters in

payments to / receipts from Iran, it has been decided that with effect from
December 27, 2010, all eligible current account transactions including trade
transactions with Iran should be settled in any permitted currency outside the
ACU mechanism, until further notice.

e) In view of the understanding reached among the members of the ACU during
the 44th Meeting of the ACU Board in June, 2015, it has been decided to permit
the use of the Nostro accounts of the commercial banks of the ACU member
countries, i.e., the ACU Dollar and ACU Euro accounts, for settling the payments
of both exports and imports of goods and services among the ACU countries

(v) Third party payments for export / import transactions

Taking into account the evolving international trade practices, it has been decided
to permit third party payments for export / import transactions can be made
subject to conditions as under:

a) Firm irrevocable order backed by a tripartite agreement should be in place.

However, it may not be insisted upon in cases where documentary evidence for
circumstances leading to third party payments / name of the third party being
mentioned in the irrevocable order/ invoice has been produced subject to:

 AD bank should be satisfied with the bona-fides of the transaction and

export documents, such as, invoice / FIRC.
 AD bank should consider the FATF statements while handling such
transaction.

b) Third party payment should be routed through the banking channel only;
 16

c) The exporter should declare the third party remittance in the Export Declaration
Form and it would be responsibility of the Exporter to realize and repatriate the
export proceeds from such third party named in the EDF;

d) It would be responsibility of the Exporter to realize and repatriate the export

proceeds from such third party named in the EDF;

e) Reporting of outstanding, if any, in the XOS would continue to be shown

against the name of the exporter. However, instead of the name of the overseas
buyer from where the proceeds have to be realized, the name of the declared third
party should appear in the XOS;

f) In case of shipments being made to a country in Group II of Restricted Cover

Countries, (e.g. Sudan, Somalia, etc.), payments for the same may be received
from an Open Cover Country; and

g) In case of imports, the Invoice should contain a narration that the related
payment has to be made to the (named) third party, the Bill of Entry should
mention the name of the shipper as also the narration that the related payment has
to be made to the (named) third party and the importer should comply with the
related extant instructions relating to imports including those on advance payment
being made for import of goods.

(vi) Settlement of Export transactions in currencies not having a direct exchange

rate:

To further liberalize the procedure and facilitate settlement of export transactions

where the invoicing is in a freely convertible currency and the settlement takes
place in the currency of the beneficiary, which though convertible, does not have a
direct exchange rate, it has been decided that AD Category-I banks may permit
settlement of such export transactions (excluding those put through the ACU
mechanism), subject to conditions as under:

 Exporter shall be a customer of the AD Bank

 Signed contract / invoice is in a freely convertible currency,
 The beneficiary is willing to receive the payment in the currency of
beneficiary instead of the original (freely convertible) currency of the
invoice/ contract, Letter of Credit as full and final settlement,
 17

 AD bank is satisfied with the bonafides of the transactions, and

 The counterparty to the exporter/ importer of the AD bank is not from a
country or jurisdiction in the updated FATF Public Statement on High
Risk & Non Co-operative Jurisdictions on which FATF has called for
counter measures.

1.7.3 Exchange Earners’ Foreign Currency Account (EEFC Account)

(i) A person resident in India may open with, an AD Category – I bank in India,
an account in foreign currency called the Exchange Earners’ Foreign Currency
(EEFC) Account, in terms of 10Regulation 4 (D) of Foreign Exchange
Management (Foreign Currency Accounts by a person Resident in India)
Regulations, 2015 dated January 21, 2016.
(ii) Resident individuals are permitted to include resident close relative(s) as
defined in the Companies Act 2013 as a joint holder(s) in their EEFC bank
accounts on former or survivor basis.

(iii) This account shall be maintained only in the form of non-interest bearing
current account. No credit facilities, either fund-based or non-fund based, shall be
permitted against the security of balances held in EEFC accounts by the AD
Category – I banks.

(iv) All categories of foreign exchange earners are allowed to credit 100% of their
foreign exchange earnings to their EEFC Accounts subject to the condition that

 The sum total of the accruals in the account during a calendar month
should be converted into Rupees on or before the last day of the
succeeding calendar month after adjusting for utilization of the balances
for approved purposes or forward commitments.
 The facility of EEFC scheme is intended to enable exchange earners to
save on conversion/transaction costs while undertaking forex transactions.
This facility is not intended to enable exchange earners to maintain assets
in foreign currency, as India is still not fully convertible on Capital
Account.
 18

CHAPTER 2
COMPANY PROFILE

Rajesh Exports Limited is a gold retailer in India which refines, designs, and sells
gold and jewellery. The company ranked 495th on the Fortune Global 500 in2019,
with revenues of more than $25,142 million, making it the eighth largest company
in India by revenue. The present managing director is Prashant Mehta and the
executive chairman is Rajesh Mehta.

2.1 History

RAJESH EXPORTS LTD. (RAJESHEXPO) - COMPANY HISTORY

Rajesh Exports Limited (REL) is the world's largest gold company and world's
only fully integrated entity across the entire value chain of gold from mining till
its own retail brand. Rajesh Exports processes about 35% of gold produced in the
world. The company is the largest refiner of gold in the world with a total capacity
to refine 2400 tons of precious metals per annum. Rajesh Exports ltd. is also the
largest manufacturer of gold products in the world. Across its various
manufacturing facilities Rajesh Exports has a total installed capacity to
manufacture 400 tons of world class gold products per annum including the finest
plain and studded jewellery medallions and coins. The company exports its
products to various countries around the world and supplies its products to bullion
banks central banks wholesale jewellery trade and retail jewellery trade.

Rajesh Exports has set up 81 retail jewellery showrooms under the brand name of
SHUBH Jewellers. Rajesh Exports has set up the world's finest R&D facilities in
Switzerland and in India for developing new designs and for evolving innovative
manufacturing process for manufacture of world class gold products. Rajesh
Exports Limited was incorporated on 1st February 1995. The Company made its
Initial Public Offer (IPO) of securities to fund expansion of manufacturing facility
in the year 1995 itself. After a year in 1996 REL had successfully implemented
the expansion plan. The Company planned to set up world's largest manufacturing
 19

facility in the year 1999 and lucratively completed the construction of the World's
largest manufacturing facility in the year 2002. The commercial production of the
company in new manufacturing facility was started in the year 2003. During the
year 2004 REL had received an export order for a total value of 1090 million and
bagged another order worth of Rs 1850 million from Gold Star Jeweller. Rajesh
Exports had completed II Phase of the World's largest gold jewellery
manufacturing facility in the same year of 2004. The Company bagged Rs. 1320
(million) order from Excel Goldsmiths UAE in the year of 2005.

During the year 2005-06 REL awarded for outstanding performance in the Export
of Plain Gold Jewellery by Gem and Jewellery Export Promotion Council and
received outstanding export performance in Gem and Jewellery sector by
Karnataka Chamber of commerce and Industry Bangalore. Oysterman had joined
its hands with the company in the year 2006 for the business development. During
the identical year of 2006 Rajesh Exports entered into realty market The Company
won the Gold Trophy at the `Inayat Shree' &NiryatBandh' Awards instituted by
the Federation of Indian Export Organization (FIEO) for outstanding performance
in Gems and Jewellery sector. The company also received FKCCI's Export
Excellence Award for 2006-07. During the year 2007 REL had established
branded national retail chain stores under the name of 'Laabh Jewellers'.

Rajesh Exports bagged an export order worth Rs. 286 crores of gold jewellery
from M/s. Excel Goldsmiths Sharjah in May of the year 2007. The Company
launched nine international diamond brands during the year and REL also
launched 'SHUBH JEWELLERS' during the year 2007-08. The Company bagged
order worth Rs 5.34 billion of gold jewellery from Kuwait-based Lazorde
Jewellery in April 2008. In 2010 Rajesh Exports' sales crossed USD 4 billion. In
2012 the company launched its retail showrooms under the SHUBH Jewellers
brand in Karnataka. In 2013 Rajesh Exports set up India's largest gold refinery in
the state of Uttaranchal thereby becoming the only player across the value chain
of gold in the world. In 2014 the company launched 80th SHUBH Jewellers
showroom in the state of Karnataka. In 2015 Rajesh Exports acquired the world's
largest gold refinery Valcambi as based in Switzerland for USD 400 million.
Valcambi the leader in precious metals refining operates one of the world's largest
 20

and most efficient integrated precious metals plants at Balerna Switzerland. In

2015 Rajesh Exports' sales crossed USD 8 billion. In 2016 Rajesh Exports' sales
crossed USD 24 billion. During the year the company launched 81st jewellery
showroom in the state of Karnataka. During the financial year ended 31 March
2017 Rajesh Exports' sales crossed USD 37 billion. During the year the company
entered the Global Fortune 500 list.

On 19 May 2017 Rajesh Exports announced that it has procured a prestigious

order for its products for a value of Rs 1140 crore. The order has been procured
beating global completion from a well-established and prestigious global while
label importer from UAE.On 2 November 2017 Rajesh Exports announced that it
has procured a prestigious order for its products for a value of Rs 634 crore. The
order has been procured beating global completion from a well-established and
prestigious global while label importer from UAE. On 19 December 2017 Rajesh
Exports announced receipt of export order for a value of Rs 878 crore from a well-
established and prestigious global white label importer from UAE. On 15
February 2018 Rajesh Exports announced receipt of a prestigious export order
worth Rs 873 crore from a leading global white label importer from UAE.

2.2 Vision and Mission Statements

2.1 Vision
The vision statement for Rajesh Exports Gold Trader to International Jewellery
Retailer is its strategic plan – it defines what and where Rajesh Exports Gold
Trader to International Jewellery Retailer Company wants to be in the future. The
vision statement for Rajesh Exports Gold Trader to International Jewellery
Retailer is a document identifying the goals of Rajesh Exports Gold Trader to
International Jewellery Retailer to facilitate its strategic, managerial, as well as
general decision-making processes.

2.1.1 Components of the vision statement

2.1.1.1 Concise

The vision statement of Rajesh Exports Gold Trader to International Jewellery

Retailer is brief and to the point. This means that the company has not used long
 21

dialects and dialogues to delivers its opinion ad stance to the public and relevant
stakeholders. The vision statement should be brief and comprehensive – it should
communicate the essence of the business, and its future to help the stakeholders
understand its business philosophy and business strategy.

2.1.1.2 Encompassing description

The vision statement of Rajesh Exports Gold Trader to International Jewellery

Retailer should be brief but should be holistic in nature. This means that the
visions statement should be complete in its description and information of what
the company desires, and how it plans to achieve its long-term goals strategically.
The vision statement should be a comprehensive statement identifying the
company’s core strengths, which would enable it to achieve its futuristic goals.

2.1.1.3 How to develop a vision statement

The company should identify the following t be able to guide its business
decisions towards future success and progress to be able to develop a successful
vision statement.

2.2 Mission

The mission statement for Rajesh Exports Gold Trader to International Jewellery
Retailer is a public document that details the values and strategic aims of Rajesh
Exports Gold Trader to International Jewellery Retailer. The mission statement of
Rajesh Exports Gold Trader to International Jewellery Retailer also identifies the
purpose of the organization existence, highlighting the services and the products it
offers. Further, the mission statement also identifies the organization’s operational
goals for Rajesh Exports Gold Trader to International Jewellery Retailer, the
processes the company uses to achieve those, the target customer groups, and the
region where the company operates.

2.2.1 Components of a mission statement

2.2.1.1 Customer satisfaction

The mission statement of Rajesh Exports Gold Trader to International Jewellery

Retailer focuses on addressing issues of customer satisfaction. The mission
statement of Rajesh Exports Gold Trader to International Jewellery Retailer has
 22

identified its target customer groups and identified their needs and demands. The
mission statement reflects on how its products and services work towards
increasing customer satisfaction for its target customers.

2.2.1.2 Based on core competencies

The mission statement of Rajesh Exports Gold Trader to International Jewellery

Retailer is based on its integral strengths and competencies. This is important for
Rajesh Exports Gold Trader to International Jewellery Retailer as the mission
statement will highlight the different systems and processes as well as strategic
tactics that the company uses to achieve its organizational and strategic goals. The
achievement of the goals will depend on how well Rajesh Exports Gold Trader to
International Jewellery Retailer makes use of its core competencies.

2.2.1.3 Realistic and clear

The mission statement for Rajesh Exports Gold Trader to International Jewellery
Retailer is also realistic and clear. This means that Rajesh Exports Gold Trader to
International Jewellery Retailer has used simple, string, and easily understood
words and phrases in the drafting of its mission statement. Clarity is important so
that the mission statement is understood by all relevant stakeholders of Rajesh
Exports Gold Trader to International Jewellery Retailer Company. Rajesh Exports
Gold Trader to International Jewellery Retailer’s mission statement is also
realistic, which makes it able to achieve various set goals and targets.

2.2.1.4 Motivational and inspirational

The mission statement of Rajesh Exports Gold Trader to International Jewellery

Retailer is motivational in that it works towards inspiring the employees and the
workforce towards giving their optimal best performance towards the goal
achievement of Rajesh Exports Gold Trader to International Jewellery Retailer.
The mission statement of Rajesh Exports Gold Trader to International Jewellery
Retailer is also inspirational in that it develops the need for growth and progress in
individuals – for the betterment of not only the company but also for their own
selves.

The mission statement of Rajesh Exports Gold Trader to International Jewellery

Retailer is precise and to the point. It is easy to understand and delivers what the
 23

audience must know about Rajesh Exports Gold Trader to International Jewellery
Retailer’s offerings and operations. It is important to keep the mission’sstateshort,
sharp and precise to be able to successfully communicate the company’s standing
to stakeholders, instead of dragging it on into long pages with repetition and non-
important aspects’

2.2.1.6 Reflects the company’s offerings

The mission statement of a company should be based on what the company has to
offer in terms of products and services. This means that the mission statement for
Rajesh Exports Gold Trader to International Jewellery Retailer highlights its
offerings but ensures that this offering is in line with the values that the company
stands for. The mission statement for Rajesh Exports Gold Trader to International
Jewellery Retailer, therefore, identifies the ethical grounds through which the
company systematically works to deliver its offering.

2.3 Product Profile

REL specializes in Asian jewellery and manufactures almost all types of Asian
Jewellery in 22cts, 21cts and 18ct.

REL has over the period understood the Asian Jewellery market in depth. The
R&D division analyses various trends and requirements of the Asian Market and
regularly develops new designs to suit the markets. REL has a current Asian
design portfolio of over 20,000 designs. The designs are categorized into various
categories and are further subdivided into subcategories and items. All the designs
are digitized and each of the design has a unique identification number.

2.3.1 EARRINGS

REL manufactures various types of earrings to suit Indian, Pakistani, Sri Lankan,
Arabic, Chinese and other Asian populations. The portfolio of earrings comprises
a weight range of 0.8 gms per pair to 50 gms per pair. All the types of earrings
like studs, hanging, bali, jumki, etc. are available in plain gold, meenakari and
various types of studding. REL has a design portfolio of over 3000 earrings in the
Asian style.
 24

2.3.2 RINGS

REL manufactures a wide range of finger rings to suit most of the Asian markets.
The portfolio of rings comprises a weight range of 0.70 gms to 15 gms per piece.
The rings are available in various workmanships like machine cut, filigree work,
plain gold, meenakari work, studded work etc. REL has a design portfolio of over
2500 rings in the Asian style.

2.3.3 PENDENTS

REL manufactures pendants in various designs & concepts to suit most of the
Asian population. The weight range available in pendent is 0.7gms to 15gms per
piece. Pendants are made in various styles like plain gold, meenakari, studded etc.
REL has a portfolio of more than 2,500 Asian design pendants.

2.3.4 CHAINS

REL manufactures chains in various designs & concepts to suit most of the Asian
population. REL manufactures chains by many different methods like machine
made, handmade etc. The weight range available in chains is 2gms to 120gms per
piece. REL has a portfolio of more than 1500 Asian design chains.

2.3.5 NECKLACES

REL manufactures necklaces in various designs & concepts to suit most of the
Asian population. The weight range available in necklaces is 8gms per piece to
55gms per piece. REL has a portfolio of more than 1200 designs in necklaces.

2.3.6 NECKLACE SETS

REL manufactures necklaces sets in various designs & concepts to suit most of
the Asian population. The weight range available in necklace sets is 14gms per set
to 600gms per set. REL has a portfolio of more than 3000 designs in necklaces
sets.
 25

2.3.7 BANGLES

REL manufactures bangles in various designs & concepts to suit most of the
Asian population. The weight range available in bangles is 8gms per pair to 120
gms per pair. REL has a design portfolio of 2000 designs in bangles.

2.3.8 BRACELETS

REL manufactures bracelets in various designs & concepts to suit most of the
Asian population. The weight range available in bracelets is 4gms per piece to
90gms per piece. REL has a portfolio of more than 1500 designs in bracelets.

2.4 Competitors

Name Last Price Market Cap. Sales Net Profit

(Rs. cr.) Turnover

Titan Company 997.30 88,538.91 20,009.64 1,517.63

Rajesh Exports 480.20 14,178.38 46,899.11 403.29

Vaibhav Global 1,272.50 4,119.62 430.68 127.37
PC Jeweller 16.85 665.58 4,938.59 78.50
Renaissance 226.65 427.90 1,260.65 31.80
Thangamayil 262.40 360.00 1,691.96 45.66
Goldiam Inter 104.70 232.17 162.09 19.04
Tribhovandas 29.30 195.52 1,810.05 21.94
D. P. Abhushan 65.10 144.88 812.13 11.79
Goenka Diamond 1.65 52.31 12.71 -0.10
Kanani Ind 4.10 40.56 83.13 0.57
Penta Gold 25.30 32.19 367.11 2.99
Moksh Ornaments 24.10 25.86 381.47 4.80
Zodiac JRD-MKJ 26.50 13.72 12.54 0.49
 26

Gitanjali Gems 1.05 12.45 10,464.77 39.72

Lypsa Gems 3.65 10.76 58.96 0.17
Tara Jewels 0.50 1.23 120.24 -670.25

2.5 Market Share

MARKETS TRENDING TERMS

NSENifty PharmaBSEAxis Bank Share PricePNB Share PriceCrude OilICICI

Bank Share PriceStocks in News ForexInfosys Share PriceCopper Rate.

2.5.1 Trending Markets

 IPO Allotment Status

 Stock Screener
 Sensex
 Stock Market
 Stock Recommendations
 IPO
 Upcoming IPO
 Gold Rate
 Top Gainers
 Rupee vs Dollar
 Share Market
 Silver Price
 Nifty 50
 Nifty Bank
 Infosys Share Price
 Crude Oil Price

2.5.2 TRENDING NOW

 Palm oil price

 Vodafone Idea share price
 27

 RIL share price

 Gold rate today
 IndusInd Bank share price
 Bank holidays in July 2020
 Why is crude oil price falling
 TCS share price
 SBI share price
 RCom share price
 YES Bank share price
 RIL share price

POPULAR CATEGORIES

 Stocks
 IPOs/FPOs
 Markets Data
 Market Moguls
 Expert Views
 Technicals
 Commodities
 Forex
 Bonds
 Stock Game
 Webinars
 Sitemap
 Definitions

Indices Overview

 NSE

Index Name Value Chg %Chg Trend Advance/Declines

 28

Index Name Value Chg %Chg Trend Advance/Declines

3
Nifty Bank 21852.40 -100.80 -0.46
8

7
Nifty IT 15285.90 163.35 1.08
2

33
Nifty 50 10607.35 55.65 0.53
16

7
Nifty Pharma 9963.40 19.75 0.20
3

12
Nifty Auto 6971.05 63.95 0.93
3

 BSE

Index Name Value Chg %Chg Trend Advance/Declines

3
Nifty Bank 21852.40 -100.80 -0.46
8

7
Nifty IT 15285.90 163.35 1.08
2

33
Nifty 50 10607.35 55.65 0.53
16

7
Nifty Pharma 9963.40 19.75 0.20
3

12
Nifty Auto 6971.05 63.95 0.93
3
 29

2.6 Milestones achieved/ Awards Received

2019: Export Excellence Awards – 2019, Star Exporter Award—Merchant Gold,

from FKCCI

2017: SWARNA RATNA AWARD by Jewellers Association, Bangalore STAR

EXPORT AWARD

2016: EXPORT EXCELLENCE AWARD 2015-2016 by FIEO (Federation of

Indian Export Organisations)

HURUN HONOUR for ‘best & brightest’ entrepreneurs and INDUSTRY

ACHIEVEMENT AWARD 2016

2014: Rajesh Exports awarded the Swarna Ratna Award by The Jewellers
Association.

2013: Rajesh Exports awarded the Special Recognition Certificate in Export

Excellence Awards by Federation of Karnataka Chambers of Commerce &
Industry.

Rajesh Exports awarded for the Highest Jewellery Exports from Kerala by Kerala
Gem and Jewellery Show.

Rajesh Exports awarded the Swarna Ratna Award by The Jewellers Association.

2012: Rajesh Mehta was conferred the Jain Bhushan Award, by Jain Social
Groups International Federation.

Rajesh Exports awarded for Export Excellence by The Jewellers Association.

2011: Rajesh Exports awarded Special Recognition Certificate by Federation of

Karnataka Chambers of Commerce and Industry.

2010: Rajesh Exports awarded the Star Exporter Award (Manufacturer Category)
from Federation of Karnataka Chambers of Commerce & Industry.

Prashant Mehta was conferred the Rotary Business Trend Setter, by Rotary
Bangalore Peenya.
 30

Rajesh Exports awarded the Excellence Award by State Bank of India.

Rajesh Exports awarded for Excellence in Exports by The Jewellers Association.

2009

Rajesh Exports awarded the State Export Excellence Award by Government of

Karnataka.

Rajesh Exports awarded for Best Manufacturer Exporter by Federation of

Karnataka Chambers of Commerce and Industry.

Rajesh Exports awarded for best SEZ in India by Export Promotion Council for
EOUs and SEZ's.

2008: Rajesh Exports awarded the Star Exporter Award (Manufacturer Category)
by Federation of Karnataka Chambers of Commerce & Industry.

Rajesh Exports awarded the State Export Excellence Award by Government of

Karnataka.

Rajesh Mehta was conferred the Jeweller of the Year by Expo world and The
Jewellers Association.

Rajesh Exports awarded 1st Place in The Export Excellence Awards by The
Jewellers Association.

Rajesh Exports awarded for best EOU in India by Export Promotion Council for
EOUs and SEZ's.

2007: Rajesh Exports awarded the Star Exporter Award (Manufacturer Category)
by Federation of Karnataka Chambers of Commerce & Industry.

Rajesh Exports awarded 1st Place in The Export Excellence Awards by The
Jewellers Association.

Rajesh Mehta was conferred the Jeweller of the Year by The Jewellers
Association.
 31

Rajesh Exports awarded the State Export Excellence Award by Government of

Karnataka.

Rajesh Exports awarded for Overall Excellence in Plain Gold Jewellery by The
Gem and Jewellery Export Promotion Council.

2006: Rajesh Exports awarded the Export Excellence Award by Federation of

Karnataka Chambers of Commerce and Industry.

Rajesh Exports ranked 1st in Dun & Bradstreet's India's Top 500 Companies 2006
(Gems and Jewellery Segment).

Rajesh Exports awarded Niryat Shree Bronze Trophy by Federation of Indian

Export Organisations (Gems & Jewellery).

Rajesh Exports awarded Niryat Shree Silver Trophy by Federation of Indian

Export Organisations (Highest Foreign Exchange Earner).

Rajesh Exports awarded for Overall Excellence in Plain Gold Jewellery by The
Gem and Jewellery Export Promotion Council.

Rajesh Exports awarded for Overall Excellence in Plain Precious Metal Jewellery
by The Gem and Jewellery Export Promotion Council.

Rajesh Exports awarded the State Export Excellence Award by Government of

Karnataka.

2005: SWARNA RATNA AWARD by Jewellers Association, Bangalore

Rajesh Exports awarded 1st Place in The Export Appreciation Awards by The
Jewellers Association.

Rajesh Exports awarded Niryat Shree Gold Trophy by Federation of Indian

Export Organisations (Gems & Jewellery).

Rajesh Exports awarded for Overall Excellence in Plain Gold Jewellery by The
Gem and Jewellery Export Promotion Council.
 32

2004: Rajesh Exports awarded the Certificate of Merit for standing first in Plain
Precious Metal Jewellery Exports by The Gem and jewellery Export Promotion
Council.

Rajesh Exports awarded 1st Place in The Export Excellence Awards by The
Jewellers Association.

Rajesh Exports awarded State Award for Excellence in Exports by Government of

Karnataka.

2003: Rajesh Exports awarded 1st Place in The Export Excellence Awards by The
Jewellers Association.

2002: Rajesh Exports awarded for Outstanding Export Performance of Plain Gold
Jewellery by The Gem and Jewellery Export Promotion Council.

Rajesh Exports awarded for Export Excellence by The Jewellers Association.

2001: Rajesh Exports awarded the Certificate of Merit for standing third in Plain
Gold Jewellery Exports by The Gem and jewellery Export Promotion Council.

Rajesh Exports awarded for Export Excellence by The Jewellers Association.

1999: Rajesh Exports awarded for Outstanding Export Performance of Studded

Gold Jewellery by The Gem and Jewellery Export Promotion Council.

1998: Rajesh Exports awarded for Outstanding Export Performance of Plain Gold
Jewellery by The Gem and Jewellery Export Promotion Council.

1997: Rajesh Exports awarded for Outstanding Export Performance of Plain Gold
Jewellery by The Gem and Jewellery Export Promotion Council.

1996: Rajesh Exports awarded State Award for Excellence in Exports by

Government of Karnataka.

Rajesh Exports awarded for Outstanding Export Performance of Studded Gold

Jewellery by The Gem and Jewellery Export Promotion Council.

Rajesh Exports awarded for Excellence in Exports by Canara Bank

 33

Rajesh Exports awarded for Outstanding Export Performance of Plain Gold

Jewellery by The Gem and Jewellery Export Promotion Council.

1995: Rajesh Exports awarded for Outstanding Export Performance of Studded

Gold Jewellery by The Gem and Jewellery Export Promotion Council.

Rajesh Exports awarded the Export Excellence award for Highest Exports by The
Jewellers Association.

Rajesh Exports awarded for Excellence in Exports by Canara Bank

Rajesh Exports awarded the State Export Excellence Award by Government of

Karnataka.

2.7 Corporate Social Responsibility

The Company has actively supported various initiatives in the areas of health,
education and environment over the years. With the introduction of Section 135 of
the Act, which came into effect during financial year 2014-15, the Company has
constituted a Corporate Social Responsibility ("CSR") Committee. The CSR
Committee decided to continue with the existing programmes and increase focus
on health and education in the years ahead. The CSR Policy is available on the
website of the Company i.e., www.rajeshindia.com The Annual Report on
Corporate Social Responsibility Activities is annexed herewith as Annexure VII.
Company’s (Disclosure of Particulars in the Report of Board of Directors) Rules,
1988.

REL firmly believes that any amount of economic progress is meaningless and
incomplete without balanced social development. Economic prosperity is a goal
for a small percentage of people, but balanced social development is an absolute
necessity for the entire humanity. REL is always willing and ready to contribute
its might, in whatever possible manner towards social development.

As one of the social responsibilities REL believes in training and developing less
privileged, wanting people. Towards striking a corporate balance REL always
reserves portion of its employment opportunities for enthusiastic capable people
with lower educational qualifications. Training the lower qualified people is a
 34

constantly carried out process at REL and this process apart from contributing to
the social responsibility has paid rich dividends to REL professionally and
commercially.

Some of the high-ranking officials of REL and current champions of the industry
were enthusiastic but non-qualified people at the time of their recruitment into
REL. With proper training and hand holding, REL has been able to develop these
people as an asset for the company and torch bearers of the jewellery industry.
REL firmly believes in cultivating people who want to work but are not fortunate
enough to acquire the right qualification for various reasons.

REL also involves itself in many social, educational and community causes on a
regular basis. REL believes in conducting these activities discreetly.

Directors'' responsibility statement Pursuant to the requirement under section 134

of the Companies Act 2013, with respect to Directors responsibility statement, it
is hereby confirmed:

1. That for the compilation of the annual accounts for the financial year ended
31.03.2019, the applicable accounting standards have been followed along with
proper explanation relating to the material departures.

2. 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 under review and of the profit of the Company for that
period.

3. That the Directors have taken proper and sufficient care for the maintenance of
adequate accounting records in accordance with the provisions of the Act, for
safeguarding the assets of the Company and for preventing and detecting fraud
and other irregularities.

4. That the Directors have compiled the accounts for the financial year ended
31.03.2019 on a "going concern" basis.
 35

5. Proper internal financial controls were followed by the Company and such
internal financial controls are adequate and were operating effectively;

6. Proper systems are devised to ensure compliance with the provisions of all
applicable laws and that such systems were
adequate and operating effectively. The Company will take up community and
socially focused activities, with particular emphasis on the following activities,
hereinafter referred to as “CSR activities”:
 Promoting preventive and general health care, sanitation including
contribution to the Swach Bharat Kosh set up by the Central Government
for the promotion of sanitation and provision of safe drinking water.
 Promoting education by providing financial assistance to deserving
educational institutions, meritorious students, including special education
and employment enhancing vocation skills especially among children,
women elderly and differently abled, promoting livelihood enhancement
projects and road safety projects with special emphasis on training
programmes.
 Promoting gender equality, empowering women, setting up homes and
hostels for women and orphans, setting up old age homes day care center
and such other facilities for senior citizens.
 Ensuring environmental sustain-ability, ecological balance, protection of
Flora and Fauna, animal welfare, agroforestry conservation of natural
resources and maintaining quality of soil, air and water including
contribution to the Clean Ganga Fund set up by the Central Government
for rejuvenation of theGanga.
 Protection of National heritage, art and culture, including restoration of
building and sites of historical importance and works of art, setting up
public libraries, promotion and development of traditional arts and
handicrafts.
 Contribution or funds provided to technology incubators located within
academic institutions which are approved by the Central Government;
 Contributing to rural development projects; and
 36

 Such other activities and projects covered in Schedule VII to the

Companies Act, 2013 and notifications made by the Ministry from time to
time.

CSR projects of the company

Protection of National Heritage Art & Culture (2015-16)

Project Budget: INR 0.07 Cr

Religious Activities (2016-17)

Project Budget: INR 0.08 Cr

Rural Development Projects (2015-16)

Project Budget: INR 0.16 Cr
 37

Healthcare Initiatives (2016-17)

Project Budget: INR 2.11 Cr

Other Companies

BA Cont inuum India Private Limited

Telangana

Act ion Construction Equipment Limited

Haryana

Sakata Seed India Private Limited

Haryana
 38

Pranav Vikas (India) Private Limit ed

Delhi

Panasonic AVC Networks India Limited

Delhi

Owari Precision Products (India) Private Limited

Karnataka

2.8 Swot Assessment

2.8.1 Strengths

 Promoters increasing shareholding

(397.8% returns for Nifty 500 over 5.9 years)
 Rising Net Cash Flow and Cash from Operating activity
(375.3% returns for Nifty 500 over 5.9 years)
 Book Value per share Improving for last 2 years
(283.6% returns for Nifty 500 over 6.3 years)
 Company with Zero Promoter Pledge
 FII / FPI or Institutions increasing their shareholding

2.8.2 Weaknesses
 39

 Inefficient use of shareholder funds - ROE declining in the last 2 years

(-10.7% returns for Nifty 500 over 1.9 years)
 Decline in Net Profit (QoQ)
 Decline in Net Profit with falling Profit Margin (QoQ)
 Major fall in TTM Net Profit
 Near 52 Week Low
 Bearish Stocks - Stocks with Medium to Low Trendlyne Momentum Score
(86.4% returns for Nifty 500 over 4.5 years)
 Companies that Declared Results in Past One Week, Showing Declining
Net Profit YoY OR QoQ (subscription)

2.8.3 Opportunities

 Positive breakout Third resistance (LTP> R3)

 Buy Zone: Stocks in the buy zone based on days traded at current PE and
P/BV
 Expert Stock Screener: Benjamin Graham Value Screen
(202.3% returns for Nifty 500 over 6.4 years)
 Price crossing above SMA20 today, and greater than SMA5
 Volume Shockers

2.8.4 Threats

 Increasing Trend in Non-Core Income

 40

CHAPTER 3

ORGANIZATIONAL STRUCTURE
COMPANY PROFILE OF RAJESH EXPORTS, INDIA

Date of Incorporation 01-Feb-1995

Date of Listing 09-Feb-2000

Management

Name Designation

Rajesh Mehta Executive Chairman

G Shanker Prasad Independent Director

Y Venu Madhava Reddy Independent Director

Vijaya Lakshmi Independent Director

Prashant Mehta Managing Director

 41

CHAPTER 4
KEY FUNCTONAL AREAS

4.1 MANAGERIAL FUNCTION

Every company has top managerial personnel who takes decision and are
responsible for the functioning as well as growth of company. The bigger
company the bigger responsibility of Board of Directors. In such a scenario,
number of actions and functions are performed in a company on daily basis and
for more smooth execution, Board of Directors appoints some officers who are
expert in their field depending upon the scope of company. For example, Board
appoints officers like :

 Chief Executive Officer (CEO)

 Manager
 Managing Director (MD)
 Company Secretary (CS)
 Chief Financial Officer (CFO)
These are officers who may or may not be directors of the company but holds a
top managerial position in a company are responsible for work performed under
their directions.
It should be noted that as a company are governed by the Companies Act,
2013 and rules made thereunder being amended, substituted, modified, omitted or
otherwise from time to time, Key Managerial Personnel are responsible and liable
for most of the wrong doing done in company.
Now, let us go through some of the important questions relating to Key
Managerial Personnel.

4.2 MARKETING FUNCTION

Invest Karnataka Gets $10 Bn Tech Investment Proposals From Over 50
Companies.
 42

Rajesh Exports proposed to invest INR 50K Cr for establishing a unit to

manufacture electric vehiclesCM Yediyurappa noted that Karnataka has a rich
talent pool of high-tech and skilled workforce the proposed projects are across
sectors such as hybrid power, electric vehicles, food technology and more In a bid
to present market opportunities to Tier 2 and 3 markets, the Karnataka state
government’s Invest Karnataka conference has received proposals worth INR 72K
Cr ($10 Bn) from over Indian and foreign companies.

One of the biggest investments came in electric vehicle ecosystem, where Rajesh
Exports proposed to invest INR 50K Cr for establishing a unit to manufacture
electric vehicles and lithium cells and batteries.“About 50 foreign and domestic
firms have proposed to invest INR 72,000 Cr in the northwest and northern
regions of the state and a dozen companies signed agreements with us,” the state’s
industries department secretary Gaurav Gupta reportedly told Livemint.

The Bengaluru-based group signed an agreement to set up a manufacturing unit in

Dharwad to roll out electric vehicles and make lithium-ion batteries. “It will
generate about 10,000 jobs,” said Gupta.

Karnataka chief minister B.S. Yediyurappa noted that Karnataka is rich in natural
and human resources, especially in high-tech and skilled workforce. The CM said
that there are plenty of investment opportunities in aerospace, automobiles,
machine tools, electric vehicles and biotechnology besides information
technology.

4.3 HUMAN RESOURCE DEVELOPMENT FUNCTION

HRD Vision

To increase human capital by enhancing learning for achieving high performance

in work related systems, processes and practices.

HRD Mission

The development of human capabilities to achieve Organizational objectives

through world class learning interventions.
 43

HRD Objectives
 To build a structure and a framework for faster dissemination of
information, ideas, trends, benchmarks and best practices.
 To architect a learning process where employees will have ample
opportunities to self develop.
 To implement HRD training solutions and interventions for upgrading
knowledge, skills and attitude of all employees for qualitative
improvement in performance.
 To integrate HRD with business strategy and implement HRD
interventions keeping pace with the changing business scenario and latest
trends in technology and management.
 Establish strategic alliances with national/international
management/educational institutes and the industry to inculcate an
outside-in perspective and a global mindset.
 Extend HRD interventions for the development of stakeholders.

4.4 INTERNATIONAL BUSINESS FUNCTION

Rajesh Exports was the largest gold product exporting company in the country
and largest manufacturer of gold jewelry in the world. The company had a
significant market share with 12% of India’s gems and jewelry exports, 25% of
gold jewelry exports and 3% of the world gold trade. Due to complete integration,
Rajesh Exports produced jewelry of guaranteed purity and finest finish at the
lowest prices in the world. The manufacturing facility of REL was designed to
control the wastage of gold due to which the production loss was pegged at 0.25%
as compared to the global average of 3%. Banking on able backward integration
and designing strengths and on the retail experience, REL was intending to
unleash a retail “Gold Revolution.”
With average gold consumption in India touching 850 tons per annum and
growing at ten percent year on year, with about ninety percent of this in jewelry,
Rajesh was drawing up Mission 2016 for leveraging economies of scale and
expanding margins, backed by fully integrated manufacturing on the back-end and
 44

a spate of retail outlets on the front-end to evolve into a fully integrated jewelry
company. The case is suitable for understanding the concepts of creating and
sustaining competitive advantage, factors contributing to success of organizations,
value chain, low-cost and differentiation strategy, vertical integration and
organizational growth.

4.5 FINANCE FUNCTION

With MSC trade finance, obtain more cash upfront to develop your activities and
expand your business facilitating commercial relationship without taking any
risks. MSC is taking care of your cargo at each step connecting both ends of every
supply chain. Partnering with trade finance experts, we can provide you with cash
liquidity to help you expand your business whilst reducing your risks. You can
maximize your working capital with our fast, simple and flexible MSC trade
finance solution.

Export Finance : Have you extended a credit period to your foreign buyers? Do
you often wait for buyer payments? Is your bank’s restricted credit facility
limiting the growth of your export business? Do you want a financial solution that
is fast, paperless, reliable, transparent and collateral-free? If you have answered
yes to any of the above questions, you need export finance to get that competitive
advantage. Here’s how our solution can help you grow your business.

How Does Export Finance Work?

Submit invoice digitally on Drip's Portal

 45

Get 80% invoice value in advance

Buyers pays 100% to Drip capital

We pay you remaining 20% less our charges

 46

CHAPTER 5
FINDINGS, SUGGESTIONS AND CONCLUSION
5.1 Findings
 Financial Health of PGCOI is sound enough.
 Current Ratio is good
 EPS has increased over the years.
 Increase in Return on equity.
 Gross And Net Profit also improved.
 Enormous Possibility Available for the company
 Low operational Risk in core business.
 Government support
 Company can take advantage of diversification opportunities
 Threat from New Competitors

5.2 Suggestions

 The strongest motivator regarding all subgroups is the feedback.

Therefore, special attention should be given to that factor in order to
increase the internal motivation and job satisfaction.
 One should have in mind that the environment and compensation do not
actually present motivators. However, their fulfilment to a certain extent
providers the basis for taking advantage of challenges in the job and to
reduce job dissatisfaction.
 In addition, special attention should be given to the skill aspect and the
compensation, since they make a contribution to the well-being of human
and provide the basis for the use of challenges offered by the job.
 Furthermore, all factors examined in this study contribute to the
organizational commitment of employees. The intrinsic factors, on the one
hand, may influence a person’s willingness to expend considerable efforts
toward the goals of the company and to remain in the company (attitudinal
commitment). The extrinsic factors, on the other hand, may contribute to
the behavioural commitment.
 47

5.3 Conclusion

Our 12-month price target on the stock is INR725 which represents about 40%
upside from current levels. Our price target is based on the average of P/E,
EV/EBITDA and DCF. We apply a 25x multiple on our FY03/2017 EPS estimate
of INR28 which come to INR700 per share. Our EV/EBITDA shows a price of
INR690 per share by applying an 8x multiple to our FY03/2017 EBITDA estimate
of INR14.7 bn. Our DCF based price is INR767 per share which assumes 12.5%
WACC and 2.5% terminal growth rate. See DCF details further in this report. In
our recent visit with management at their corporate headquarters, the CEO
reiterated his ambitious growth plans which should further add shareholder value
if successfully executed.

The company is currently undergoing a positive mix shift whereby the proportion
of revenue contribution from the high margin retail business is increasing. There
is very high operating leverage in the business with the company operating at an
EBITDA margin of 2.5%. Hence, a small increase in margins can have a
multiplier effect on the net income. The retail business commands gross margins
in the range of 7%-8% while the exports business operates at a gross margin of
under 2%. Additionally, the company is also actively pursuing inorganic growth
opportunities through M&A as it moves towards its next phase of growth. Rajesh
Exports has two business divisions; Exports and Retail which accounts for 91%
and 9% of total revenues respectively. The company has a refining facility in the
north Indian state of Uttaranchal with a capacity to refine 400 tons per annum
[tpa]. It also has a jewelry manufacturing facility in the southern city Bangalore
with a capacity of 250 tpa.
 48

CHAPTER 6
BIBLIOGRAPHY AND ANNEXURE
6.1 BIBLIOGRAPHY

 https://in.investing.com/equities/rajesh-exports-financial-summary

 https://www.indiainfoline.com/company/rajesh-exports-
ltd/summary/13051

 https://en.wikipedia.org/wiki/Rajesh_Exports

 https://economictimes.indiatimes.com/rajesh-exports-
ltd/stocks/companyid-6650.cms

 https://www.business-standard.com/company/rajesh-exports-
13051/annual-report/auditors-report

 https://rajeshindia

 http://production.s3.amazonaws.com/uploads/analyst/file/1/1__Evaluate.p
df

 https://www.financialexpress.com/market/stock-market/rajesh-exports-ltd-
stock-price/financials-profit-and-loss/

 https://www.newshour.press/business/dominance-rajesh-exports-sez-
trading-future/

 https://www.cameoventures.com/?keyword=rajesh&matchtype=b&device
=c&adposition=&network=s&gclid=EAIaIQobChMIsoy3j_m16gIVgw4r
Ch12GQ5OEAAYASAAEgIngPD_BwE

 https://economictimes.indiatimes.com/industry/cons-products/fashion-/-
cosmetics-/-jewellery/rajesh-exports-in-talks-to-pick-up-stake-in-swiss-
gold-refinery-valcambi-for-rs-2500-
crore/articleshow/47888377.cms?from=mdr
 49

6.2 ANNEXURE
Profit and loss account of Rajesh exports(in Rs.cr)

PROFIT & LOSS ACCOUNT OF MAR 20 MAR 19 MAR 18 MAR 17 MAR 16

RAJESH EXPORTS (in Rs. Cr.)

12 mths 12 mths 12 mths 12 mths 12 mths

INCOME

REVENUE FROM 46,899.11 42,670.89 33,660.46 44,947.73 38,585.96

OPERATIONS [GROSS]

Less: Excise/Sevice Tax/Other 0.00 0.00 0.00 0.00 0.00

Levies

REVENUE FROM 46,899.11 42,670.89 33,660.46 44,947.73 38,585.96

OPERATIONS [NET]

TOTAL OPERATING 46,899.11 42,670.89 33,660.46 44,947.73 38,618.69

REVENUES

Other Income 2.78 51.50 38.25 43.67 4.01

TOTAL REVENUE 46,901.89 42,722.39 33,698.72 44,991.41 38,622.70

EXPENSES

Cost Of Materials Consumed 46,403.93 41,895.20 32,731.07 44,106.38 37,756.76

Operating And Direct Expenses 0.00 0.00 0.00 0.00 0.00

Changes In Inventories Of FG,WIP 45.35 0.00 0.00 0.00 0.00

And Stock-In Trade

Employee Benefit Expenses 6.09 6.87 6.08 6.61 5.49

Finance Costs 0.00 319.84 430.83 351.08 307.99

Depreciation And Amortisation 1.14 1.41 1.49 1.85 1.86

Expenses
 50

Other Expenses 9.52 33.50 40.73 39.43 40.55

TOTAL EXPENSES 46,466.03 42,256.81 33,210.20 44,505.35 38,112.65

PROFIT/LOSS BEFORE 435.86 465.58 488.51 486.06 510.05

EXCEPTIONAL,
EXTRAORDINARY ITEMS
AND TAX

Exceptional Items 0.00 0.00 0.00 0.00 0.00

PROFIT/LOSS BEFORE TAX 435.86 465.58 488.51 486.06 510.05

TAX EXPENSES-CONTINUED
OPERATIONS

Current Tax 32.57 23.96 47.23 19.27 34.77

Less: MAT Credit Entitlement 0.00 0.00 0.00 0.00 0.00

Deferred Tax 0.00 -0.50 0.03 5.45 0.00

Tax For Earlier Years 0.00 0.00 0.00 0.00 0.00

TOTAL TAX EXPENSES 32.57 23.46 47.26 24.72 34.77

PROFIT/LOSS AFTER TAX 403.29 442.12 441.26 461.34 475.29

AND BEFORE
EXTRAORDINARY ITEMS

PROFIT/LOSS FROM 403.29 442.12 441.26 461.34 475.29

CONTINUING OPERATIONS

PROFIT/LOSS FOR THE 403.29 442.12 441.26 461.34 475.29

PERIOD

OTHER ADDITIONAL
INFORMATION

EARNINGS PER SHARE

 51

Basic EPS (Rs.) 13.65 14.97 14.94 15.62 16.10

Diluted EPS (Rs.) 13.65 14.97 14.94 15.62 16.10

VALUE OF IMPORTED AND

INDIGENIOUS RAW
MATERIALS STORES, SPARES
AND LOOSE TOOLS

Imported Raw Materials 0.00 0.00 0.00 0.00 0.00

Indigenous Raw Materials 0.00 0.00 0.00 0.00 0.00

STORES, SPARES AND LOOSE

TOOLS

Imported Stores And Spares 0.00 0.00 0.00 0.00 0.00

Indigenous Stores And Spares 0.00 0.00 0.00 0.00 0.00

DIVIDEND AND DIVIDEND

PERCENTAGE

Equity Share Dividend 0.00 29.53 32.48 0.00 29.53

Tax On Dividend 0.00 0.00 0.00 0.00 6.01

Equity Dividend Rate (%) 100.00 100.00 100.00 110.00 100.00

Balance sheet of Rajesh exports (in Rs. Cr)

BALANCE SHEET OF MAR '20 MAR '19 MAR '18 MAR '17 MAR '16
RAJESH EXPORTS (in Rs.
Cr.)

12 mths 12 mths 12 mths 12 mths 12 mths

SOURCES OF FUNDS

Total Share Capital 29.53 29.53 29.53 29.53 29.53

 52

Equity Share Capital 29.53 29.53 29.53 29.53 29.53

Reserves 4,907.18 4,533.24 4,120.70 3,712.00 3,250.66

NETWORTH 4,936.71 4,562.77 4,150.23 3,741.53 3,280.19

Secured Loans 960.96 6,072.32 8,594.55 5,434.93 4,429.86

Unsecured Loans 0.00 0.00 0.00 0.00 31.88

TOTAL DEBT 960.96 6,072.32 8,594.55 5,434.93 4,461.74

TOTAL LIABILITIES 5,897.67 10,635.09 12,744.78 9,176.46 7,741.93

Gross Block 63.71 89.71 93.24 92.90 92.87

Less: Accum. Depreciation 0.00 25.48 27.95 26.46 25.51

NET BLOCK 63.71 64.23 65.29 66.44 67.36

Capital Work in Progress 0.00 0.35 1.86 1.22 0.00

INVESTMENTS 2,591.89 733.33 719.53 731.52 636.08

Inventories 579.64 624.98 1,050.84 531.72 399.06

Sundry Debtors 2,790.48 2,353.12 1,596.91 3,344.80 3,668.55

Cash and Bank Balance 11,182.17 14,470.35 13,625.99 13,774.09 11,652.39

Total Current Assets 14,552.29 17,448.45 16,273.74 17,650.61 15,720.00

Loans and Advances 1,134.27 2,923.79 2,868.95 2,749.22 2,656.94

Total CA, Loans & Advances 15,686.56 20,372.24 19,142.69 20,399.83 18,376.94

Current Liabilities 12,411.06 10,510.43 7,136.79 12,002.41 11,295.22

Provisions 33.42 24.63 47.82 20.14 44.14

Total CL & Provisions 12,444.48 10,535.06 7,184.61 12,022.55 11,339.36

 53

NET CURRENT ASSETS 3,242.08 9,837.18 11,958.08 8,377.28 7,037.58

TOTAL ASSETS 5,897.68 10,635.09 12,744.76 9,176.46 7,741.02

Contingent Liabilities 0.00 4.94 4.94 4.99 50.07

Book Value (Rs) 167.20 154.53 140.56 126.72 111.09