PNGS Gargi Fashion Jewellery Ltd

To

The Members,

Your directors have a pleasure in presenting the 16^th Annual Report together with the audited financial statements, for the year ended 31^st March, 2025.

1. FINANCIAL RESULTS

(Rs. In Lakhs)

2. OPERATIONS OF THE COMPANY AND THE STATE OF COMPANY'S AFFAIRS

Your Company is engaged in the retail business of costume and fashion jewellery under the brand name "Gargi by P. N. Gadgil & Sons" which was launched in 2021 and the company had introduced heavy/bridal costume jewellery under brand name "Utsaav" which was launched in 2025 under the fashion jewellery segment. The Company deals in 92.5% certified sterling silver jewellery, brass and copper jewellery, idols and other gift articles. The Company commenced commercial sale of 14 Carat Gold studded with diamond jewellery from October 2023.

During the financial year, your Company has reported a total revenue of Rs. 12634.80 Lakhs against Rs. 5050.94 Lakhs in the previous financial year. The net profit for the current financial year stood at Rs. 2880.68 Lakhs against Rs. 845.85 Lakhs in the previous financial year.

Listing fees and the custodian charges to depositories, for the financial year have been paid to BSE, NSDL and CDSL respectively.

Further, The Shop in Shop (SIS) locations of the company maintained with P. N. Gadgil & Sons Limited has changed business model from Franchisee Operated -Company Owned (FOCO) to Franchisee Owned -Franchisee Operated (FOFO) basis. Due to change in business model, drastic change took place in the figures for current year as well as previous year.

All the Shares of your Company are in Dematerialized mode as on 31^st March, 2025. The ISIN of the Equity Shares of your Company is INE0NT601018.

3. EXPANSION

As on date, the Company has opened several exclusive brand store franchisees over various locations like Pune, New Delhi, Thane, Sambhaji Nagar, Gurugram, Indore, and Nagpur. The Company now has 33franchise stores with P. N. Gadgil & Sons Limited, 50 Shop In Shops and 14 exclusive brand stores. This expansion has exceeded the projected growth plan for the financial year.

4. CHANGE IN NATURE OF BUSINESS, IF ANY

During the year, there was no change in the nature of business of the Company.

5. CHANGE IN CAPITAL STRUCTURE

During the year under review there were following changes in the Capital structure of the Company:

1. The Company has increased its Authorised Share Capital of the Company from existing Rs. 10,00,00,000/- (Rupees Ten Crores only) to Rs. 20,00,00,000/- (Rupees Twenty Crores only) [vide

Ordinary Resolution passed by the shareholders at the Annual General Meeting held on 24^th June, 2024.]

2. Increase in paid up capital of the Company to Rs. 10,35,78,030/- (Ten Crore Thirty-Five Lakh Seventy-Eight Thousand and Thirty only) due to allotment of 7,29,800 (Seven Lakh Twenty-Nine Thousand and Eight Hundred) Equity shares of Rs. 10/- (Rupees Ten only) each at a price of Rs. 575/- (Rupees Five Hundred and Seventy-Five only) including share premium of Rs. 565/- (Rupees Five Hundred and Sixty-Five only) per share aggregating to Rs. 41,96,35,000/- (Rupees Forty-One Crore Ninety-Six Lakh Thirty-Five Thousand only) to the specified investors by way of Preferential Allotment of Equity Shares on 26^th August, 2024.

6. MATERIAL CHANGES AND COMMITMENTS IF ANY, AFFECTING THE FINANCIAL POSITION OF THE COMPANY WHICH HAVE OCCURRED BETWEEN THE END OF THE FINANCIAL PERIOD OF THE COMPANY TO WHICH THE FINANCIAL STATEMENTS RELATE AND THE DATE OF THE REPORT

There have been no material changes and commitments affecting the financial position of the Company, between the end of the financial period of the Company to which the financial statements relate and the date of this report.

7. DETAILS OF SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS OR TRIBUNALS IMPACTING THE GOING CONCERN STATUS AND COMPANIES OPERATIONS IN FUTURE

There are no significant and material orders passed by the regulators, courts or tribunals, which affect the going concern status of the Company and its operations in future.

8. RESERVES

The Board of Directors have not proposed to transfer any amount to any Reserve. Therefore, entire profits of Rs. 2,880.68 Lakhs earned during the financial year 2024-25 have been retained in profit and loss account.

9. DIVIDEND

The Board of Directors do not recommend any dividend for the financial year ended on 31^st March, 2025 in order to conserve resources for future development.

As on 31^st March, 2025, the Board of your Company comprises of 6 Directors including 3 Non-Executive Directors and 3 Independent Directors of which 1 is a woman director.

During the year under review, Ms. Bhargavi Kulkarni, Company Secretary tendered her resignation on 06^th May, 2024 from the position of Company Secretary and Compliance Officer w.e.f. close of the business hours 28^th June 2024.

And Mrs. Neha Dhirendra Boid was appointed as a Company Secretary and Compliance officer w.e.f. 1^st July, 2024.

On the basis of representations received from the Directors, none of the Directors of the Company are disqualified as per Section 164(2) of the Companies Act, 2013 and rules made thereunder or any other provisions of the Companies Act, 2013. The Directors have also made necessary disclosures to as required under provisions of Section 184(1) of the Companies Act, 2013. All members of the Board of Directors and senior management personnel affirmed compliance with the Company's Code of Conduct policy for the financial year 2024-25.

Pursuant to Section 152 of the Companies Act 2013 read with Article 94 of Articles of Association of the Company, Mr. Aditya Amit Modak (DIN :09237633) Director of the Company is liable to retire by rotation and being eligible has offered himself for reappointment at the ensuing Annual General Meeting. The Board recommends his reappointment.

The Company has received declarations from the Independent Directors of the Company under Section 149(7) of the Companies Act, 2013 confirming that they meet the criteria of independence as provided in Section 149(6) of the Companies Act, 2013 and there has been no change in the circumstances which may affect their status as Independent Directors.

During the FY 2024-25 separate meeting exclusively of Independent Directors was held on 24^th January, 2025.

During the financial period 2024-25, the Board of Directors met 9 times, the details of which are as under.

In accordance with the provisions of Section 134 (3) (c) of the Companies Act, 2013, your Directors state as under –

(a) In the preparation of the annual accounts, the applicable accounting standards had been followed along with proper explanation relating to material departures, if any;

(b) the Directors had 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 period and of the profit of the Company for that period;

(c) the Directors had taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of this Act for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

(d) the Directors had prepared the annual accounts on a going concern basis;

(e) the Directors had laid down internal financial controls to be followed by the Company and such internal financial controls are adequate and were operating effectively; and

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

Pursuant to Regulation 34 (2) (e) read with Schedule V of SEBI (Listing Obligations and Disclosure Requirement) Regulations, 2015, Management Discussion & Analysis Report for the year under review forms the part of this report and is marked as Annexure – ‘A' to this report.

Your Directors have constituted the Audit committee in accordance with Section 177 of the Companies Act, 2013 read with rule 6 of Companies (Meetings of Board and its Powers) Rules, 2014. The members of the Committee are as follows:

1. Mr. Ranjeet Sadashiv Natu, Independent Director, Chairman of the Committee

2. Mrs. Sweta Ashish Khandelwal, Independent Director

3. Mr. Aditya Amit Modak, Non- executive Director

Six (6) meetings of the Committee were held during the period ended 31^st March, 2025 on 24^th April, 2024; 6^th May, 2024; 31^st July, 2024; 26^th August, 2024; 23^rd October,2024and 24^th January, 2025 detailed as under:

Further, there were no such instances where the recommendation of the Audit Committee were not accepted by the Board during the financial year under review.

Your directors have constituted a Nomination and Remuneration Committee as required under the provisions of Section 178 of the Companies Act, 2013. The Nomination and Remuneration Committee consists of following members:

1. Mr. Ashok Namdeo Gokhale, Independent Director, Chairman of the Committee

2. Mr. Ranjeet Sadashiv Natu, Independent Director

3. Mr. Govind Vishwanath Gadgil, Non- executive Director

The Committee met once on 24^th June, 2024, during the year under reviewand Mr. Ashok Namdeo Gokhale, Independent Director, Chairman of the Committee and Mr. Govind Vishwanath Gadgil, Non- executive Director, attended the meeting.

Policy on Nomination and Remuneration for the Board and Senior Officials is available on the website of the Company at https://www.gargibypng.com/corporate-policies/

Your Board has constituted Stakeholders Relationship Committee under the provisions of Section 178(5) of Companies Act, 2013. The Committee consists of following members:

1. Mr. Ranjeet Sadashiv Natu, Independent Director, Chairman of the Committee

2. Mrs. Sweta Ashish Khandelwal, Independent Director

3. Mr. Aditya Amit Modak, Non- executive Director

This Committee is primarily responsible to review all matters connected with the Company's transfer/ transmission of securities and redressal of shareholder's / investor's / security holder's complaints.

The Committee met once on 24^th January, 2025 during the year under review and Mr. Ranjeet Sadashiv Natu, Independent Director, Chairman of the Committee and Mr. Aditya Amit Modak, Non- executive Director attended the meeting.

Your Board has constituted Borrowing Committee in view of need for operational convenience. The Committee consist of following members:

1. Mr. Govind Vishwanath Gadgil, Non- executive Director, Chairman of the Committee

2. Mr. Amit Yeshwant Modak, Non- executive Director

3. Mr. Aditya Amit Modak, Non- executive Director

This Committee is authorized to borrow in the form of fund based and non-fund credit facilities from Bankers, financial institutions, bodies corporate and other eligible entities up to the amount approved by the Board of Directors of the Company from time to time.

As per the Companies (Management and Administration) Amendment Rules, 2020 dated 28^th August, 2020, the Annual Return is being placed on the website of the Company https://www.gargibypng.com/.

All the contracts / arrangements / transactions entered by the Company during the financial year 2024-25 with the related parties (RPTs) were on an arm's length basis and in the ordinary course of business and approved by the Audit Committee and omnibus approval was obtained, where applicable. Though the transactions during the financial year were at arm's length and in ordinary course of business, considering the quantum of the transactions, the same were approved by the shareholders' at the previous Annual General Meeting.

As per the amendment to Regulation 23 of the Securities and Exchange Board of India (Listing Obligations and Disclosures Requirements) Regulations, 2015 ("SEBI LODR"), if any Related Party Transactions ("RPT") entered into by an entity having its specified securities listed on SME Exchange, exceeds Rs. 50 crore or 10% of the annual consolidated turnover, whichever is lower as per the last audited financial statement, would be considered as material and would require members' approval. The proposed material RPTs of the Company are put forth before the shareholders at the ensuing Annual General Meeting for their approval.

The information on transactions with related parties pursuant to Section 134(3)(h) of the Act read with Rule 8(2) of the Companies (Accounts) Rules, 2014 are given in Annexure – ‘B' in Form No. AOC-2 and the same forms part of this report. All such transactions were reviewed and approved by the Audit Committee from time to time.

There have been no materially significant related party transactions with the Company's Promoters, Directors and others as defined in Section 2(76) of the Companies Act, 2013 which may have potential conflict of interest with the Company at large.

The policy on Related Party Transactions as approved by the Board is available on the website of the Company at https://www.gargibypng.com/corporate-policies/ .

The Company has neither granted any loan, given any guarantees during the financial period under consideration. Currently the Company has investments in Government Securities amounting to Rs. 10.55 Lakhs which are within the limits approved by the shareholders under Section 186 of the Companies Act, 2013.

Your Company has not accepted any deposits during the year in terms of Section 73 of the Companies Act, 2013 and the Companies (Acceptance of Deposits) Rules, 2014.

The Company has not accepted any unsecured loan from its Directors/ their relatives.

Your Company believes in giving back to the society in a meaningful way. The Company recognizes the importance of Corporate Social Responsibility and strives to make a positive impact on the environment.

It believes in empowering communities and making a difference in people's lives. The Company has formulated a Corporate Social Responsibility Policy which is available on the website of the Company https://www.gargibypng.com/corporate-policies/. T he Board of Directors formulate, implement, monitor and review the impact of the CSR initiatives of the Company.

A detailed report on the Corporate Social Responsibility is enclosed as an Annexure ‘D' to this report.

No company has become or ceased to be subsidiary, joint venture or associate company during the year under review.

As the Company does not have any Subsidiary/Joint Venture/Associate Company as on 31^st March, 2025, there is nothing to report for the year under review.

During the financial year under review, the Company is in adherence with the applicable Secretarial Standards issued by the Institute of Company Secretaries of India.

The provisions of Section 148 of the Companies Act, 2013 read with Notifications/ Circulars issued by the Ministry of Corporate affairs from time to time, regarding maintenance of Cost records, are not applicable to the company.

25. RISK MANAGEMENT

Every business is subject to risks, uncertainties that could cause actual results to differ materially from those contemplated. The Company has in place a mechanism comprising of regular audits and checks to inform the Board members about the Risk assessment and mitigation plans and periodical reviews to ensure that the critical risks are controlled by the management. Major risks identified are systematically addressed through risk mitigation actions on a continuing basis.

The Company has in place a policy for prevention of sexual harassment at workplace. This inter alia provides a mechanism for the resolution, settlement or prosecution of acts or instances of Sexual Harassment at work and ensures that all employees are treated with respect and dignity. The Internal

Complaints Committee(s) (ICC) has been set up by the Company to redress complaints received regarding sexual harassment and No complaint has been received till date.

Policy is available on the website of the Company at https://www.gargibypng.com/corporate-policies/

During the year under review, in this regard, in terms of Section 22 of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act 2013, read with Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Rule 2013, the report for the year ended on 31^st March, 2025

No. of Complaints received in the year; Nil No. of complaints disposed off in the year; Nil Cases pending for more than 90 days; Nil

No. of workshops and awareness programmes conduced in the year; Nil

Nature of action by employer or District Officer, if any Nil

The formal evaluation mechanism has been adopted to assess the performance of the Board as well as its Committees and Individual Directors of the Board.

This structured evaluation process encompasses several aspects, including composition of the Board & Committees, experience and competencies, performance of specific duties and obligations, attendance and contribution at Board meetings / Committee meetings / General meetings, preparedness for meetings, effective decision making ability, knowledge of sector where Company operates, understanding and avoidance of risk while executing functional duties, successful negotiating ability, initiative to maintain corporate culture, commitment, dedication of time, leadership quality, attitude, initiatives and responsibilities undertaken, achievements etc.

In a separate meeting of Independent Directors held on 24^th January, 2025, the performance of non-independent Directors, the Board as a whole, and the Chairman were evaluated. The said meeting was attended by all the Independent Directors of the Company.

Further, the Board has expressed its satisfaction and has been thankful to all its Independent Directors for sharing their knowledge and expertise which has been proved beneficial to the progress of the Company.

28. DISCLOSURE REQUIRED UNDER SECTION 134(3)(e)

The Board has implemented a Board Diversity Policy, establishing criteria for both appointment and continuance of Directors, at the time of re-appointment of director in the Company. According to this policy, the Board has an optimum combination of members with appropriate balance of skill, experience, background, gender and other qualities of directors required by the directors for the effective functioning of the Board. The Nomination and Remuneration Committee is responsible for recommending remuneration of the Directors, within the overall limits defined by the Act and outlined in the Remuneration Policy.

No disclosures are required to be made regarding the conservation of energy, technology absorption and foreign exchange as stated under Section 134(3) (m) of the Companies Act, 2013 read with Rule 8 of the Companies (Accounts) Rules, 2014.

Foreign Exchange earnings and outgo: NIL

Foreign Exchange earned in terms of actual inflows during the year: NIL

Foreign Exchange outgo during the year in terms of actual outflows: NIL

The Company has in place a Whistle Blower Policy, which serves as a vigil mechanism, enabling Directors and employees to formally report their concerns about unethical behavior, actual or suspected fraud or violation of the Company's Code of Conduct or ethics policy. The Policy provides for adequate safeguards against victimization of employees who avail such mechanism and also provide for direct access to the Chairman of the Audit Committee. The Policy is accessible on the website of the Company at https://www.gargibypng.com/corporate-policies/

Your Board is responsible for establishing and maintaining adequate internal financial control as per Section 134 of the Act.

Your Board has laid down policies and processes with respect to internal financial controls and such internal financial controls are adequate and operating effectively. The internal financial controls covered the policies and procedures adopted by the Company for ensuring orderly and efficient conduct of business including adherence to Company's policies, safeguarding of the assets of the Company, prevention, and detection of fraud and errors, accuracy and completeness of accounting records and timely preparation of reliable financial information.

Statutory Auditors

The Company had appointed M/s Khandelwal Jain & Associates, Chartered Accountants, Pune (FRN 139253W) as Statutory Auditors of the Company at the 12^th Annual General Meeting held on 31^st August 2021 to hold the office till the conclusion of the Annual General Meeting of the Company to be held in the year 2026 for the financial year ending 31^st March, 2026.

The Auditors' Report does not contain any qualification, reservation, adverse remark or disclaimer.

During the Financial Year 2024-25, the Auditors have not reported any matter under section 143(12) of the Companies Act, 2013, therefore no details are required to be disclosed under Section 134(3)(ca) of the Companies Act, 2013.

Secretarial Auditors

During the year under review, the Company appointed Ms. Ruchi Bhave, (FCS: 13324, CP 27019) Practicing Company Secretary as the Secretarial Auditor of the Company in the Board Meeting held on 26^th August, 2024 in accordance with the provisions of Section 204 of the Companies Act, 2013 read with the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 for the Financial Year 2024-25 and onwards.

The report of the Secretarial Auditor MR-3 for the financial year 2024-25 is enclosed as Annexure ‘E' to this Board's Report, which is self-explanatory. The Secretarial Audit Report does not contain any qualification, reservation or adverse remark.

The Company has appointed M/s Joshi & Sahney, Chartered Accountants, Pune (FRN 104359W) as the Internal Auditors of the Company under the provisions of section 138 of the Act, for conducting the internal audit of the Company for the financial year 2022-23 onwards.

During the year under review, neither the Statutory Auditors nor the Secretarial Auditor have reported any instances of fraud committed in the Company by its officers or employees to the Audit Committee, pursuant to Section 143(12) of the Companies Act, 2013, the details of which would be required to be mentioned in the Board's report.

The details of Managerial Remuneration, Key Managerial Personnel and employees of the Company as required under Section 197(12) of the Companies Act, 2013 read with Rule 5 of the Companies

(Appointment and Remuneration of Managerial Personnel) Rules, 2014 has been set out as Annexure – ‘C' to this Report, attached hereto.

Your Company has a fully functional website viz. www.gargibypng.com w hich has been designed to exhibit all the relevant details about the Company. The site carries a comprehensive database of information of the Company including the Financial Results of your Company, Shareholding Pattern, details of Board Committees, Corporate Policies/ Codes, business activities and current affairs of your Company. All the mandatory information and disclosures as per the requirements of the Companies Act, 2013, Companies Rules, 2014 and as per Regulation 46 of SEBI (Listing Obligations & Disclosure Requirements) Regulations, 2015 and other relevant information has been duly presented on the website of the Company.

Since the Company is listed on BSE SME platform, the Company is exempt from applicability of certain regulations pertaining to ‘Corporate Governance' under Securities & Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015.

The Company has been practicing sound Corporate Governance and takes necessary actions at appropriate times for enhancing and meeting stakeholders' expectations while continuing to comply with the mandatory provisions and strive to comply non-mandatory requirements of Corporate Governance.

Report on Corporate Governance Practices and the Auditors Certificate regarding compliance of conditions of Corporate Governance and certification by CEO/Whole time Director & CFO is not applicable to your Company as per regulation 15(2)(b) of SEBI (Listing Obligation and Disclosure Requirements) Regulations, 2015.

During the year under review, the Company was not subject to any fine/ compounding

During the year under review, the Company had raised funds of Rs. 4196.35 Lakhs through the preferential issue of Equity shares. The said funds were raised for the following purposes:

1. Expansion of Brand and SIS stores

2. PAN India Marketing Campaign

3. Inventory Management

Out of total funds raised, Rs. 759.22 Lakhs were utilized during the year majorly for the purpose of expansion of brand stores and inventory management for such stores. Remaining funds amounting to Rs. 3437.13 Lakhs shall be utilized for the pre-determined purposes.

There is nothing to report under this for the year under review.

There is nothing to report under this for the year under review.

The Directors place on record their sincere appreciation of the co-operation extended by the Bankers of the Company, stakeholders, business associates, consultants, and various Government Authorities for their continued support extended to your Company's activities during the period under review.

The Board further take opportunity to place on record its deep appreciation for the committed efforts by the employees of Company at all the levels.