GITANJALI GEMS LIMITED

(Incorporated on August 21, 1986 under the Companies Act, 1956)
Registered Office: 801/802, Prasad Chambers, Opera House, Mumbai 400 004
Tel:+91-22-2363 0272, Fax:+91-22-2363 0363 Website: www.gitanjaligroup.com, Email: ipo@gitanjaligroup.com

BASIS OF ALLOCATION

PUBLIC ISSUE OF 17,000,000 EQUITY SHARES OF RS.10/- EACH FOR CASH AT A PRICE OF RS. 195/- PER EQUITY SHARE AGGREGATING TO RS. 33,150 LACS (REFERRED TO AS "THE ISSUE"), OF WHICH 150,000 EQUITY SHARES OF RS.10/- EACH ARE RESERVED FOR SUBSCRIPTION BY PERMANENT EMPLOYEES AND DIRECTORS OF THE COMPANY WHO ARE INDIAN NATIONALS AND ARE BASED IN INDIA. THE ISSUE WOULD CONSTITUTE 28.81% OF THE FULLY DILUTED POST ISSUE CA ITAL OF THE COMPANY.

THE FACE VALUE PER EQUITY SHARE IS RS.10/- EACH FOR CASH AT A PRICE OF RS. 195/- EACH AND THE ISSUE PRICE IS 19.5 TIMES OF THE FACE VALUE.

The Issue made through the 100% Book Building Process where at least 50% of the net issue to the public was to be allocated on a proportionate basis to Qualified Institutional Buyers ("QIBs") (including 5% of the QIB portion that was to specifically be allotted to mutual funds)., Further, up to 15% of the net issue to the public shall be available for allocation on a proportionate basis to Non-Institutional Bidders and up to 35% of the net issue to the public shall be available for allocation on a proportionate basis to Retail Bidders, subject to valid bids being received at or above the Issue Price.

The Issue received 247037 applications for 254956322 equity shares resulting in 14.99 times subscription. The details of the applications received in the Issue from Qualified Institutional Buyers, Non-Institutional, Retail Individual Investors and Employees categories are as under (Before technical rejections):

Final Demand
A sample of the final demand at different bid prices is as under:

The Basis of Allocation was finalized in consultation with the Bombay Stock Exchange Limited ("BSE") on 6th March, 2006. A) Employees
The Basis of Allocation to the Employees category, who have bid at cut-off or at and above the Issue Price of Rs.195/- per Equity Share, was finalized in consultation with BSE. The category was subscribed 1.04 times. Firm allotments have been made against all applications. The total number of shares allotted in this category is 150000 Equity Shares. The category-wise details of the Basis of Allocation (Sample) are as under:

B) Allocation to Retail Investors
The Basis of Allocation to the Retail onvestors, who have bid at cut-off or at and above the Issue Price of Re. 195/- per Equity Share, was finalized In consultation with BSE. The category was over subscribed 9.10 times, The total number of shares allotted In this category Is 5897500 Equity Shares The category-wise details of the Basis of Allocation are as under:

C. Allocation to Non Institutional Investors
The Basis of Allocation to the Non institutional, who have bid at and above the Issue Price of Rs.195/- per Equity Share, was finalized in consultation with BSE. The category was subscribed 14.49 times. The total number of shares allotted In this category Is 2527500 Equity Shares. The category-wise details of the Basis of Allocation (Sample) are as under:

D. Allocation to QIBs

Allocation to QIBs have been done on a proportionate basis in consultation with the Bombay Stock Exchange Limited. As per the SEBI guidelines, Mutual Funds were initially allotted 5% of the quantum of shares available (421250) and other QIBs and unsatisfied demands of Mutual Funds were allotted the remaining available shares (8003750) on proportionate basis. The sectoral cap and other limits applicable to the holding of shares in company have been taken into account while allotting shares. Mutual Funds were allotted 18.25% for QIB segment and other QIB applicants were allotted $1.75% of the shares for QIB segment.

The Committee of Directors of the company at it's Meeting held at Hyderabad on 6th March, 2006 has approved the basis of allocation of shares of the Issue and has allotted the shares to various successful applicants.

The Refund Orders and allotment advice and notice has been dispatched to the address of the investors as registered with the depositories. In case the same is not received within ten days, investors may contact at the address given below. The Refund Orders have been over-printed with the Bank Mandate details as registered, if any, with the depositories. The shares allocated to successful applicants are being credited to their beneficiary accounts subject to validation of the account details with the depositories concerned. The company is taking steps to get the equity shares admitted for trading on National Stock Exchange of India Limited and Bombay Stock Exchange Limited within seven working days from the date of approval of the basis of allocation.

INVESTORS PLEASE NOTE

This details of the allocation made would be hosted on the website of Registrars to the Issue, Karvy Computershare Private Limited at www.karvy.com or http://karisma.karvycom

All future correspondence in this regard may kindly be addressed to the Registrars to the issue quoting full name of the First/ Sole applicant, Serial number of the bid-cum-application form, number of shares bid for, name of the Member of the Syndicate and Place where the bid was submitted and payment details at the address given below:

KARVYCOMPUTERSHARE PRIVATE LIMITED
Unit: Gtanjali, Karvy House,
46, Avenue 4, Street No.1, Banjara Hills,
Hyderabad - 500034, Fax: 040-23311968
Email: gftanjali.ipo@karvy.com or mailmanager@karvy.com

TOLL FREE - HELPLINE NUMBER 1-600-3454001
1-600-3454001