1. STATEMENT OF SIGNIFICANT ACCOUNTING POLICIESa. Background
APOLLO INGREDIENTS LIMITED (“the Company”) is a public limited company domiciled in India and incorporated under the provisions of the Companies Act 1956. The registered office of the Company is located at MITTAL ENCLAVE BLDG- 6 A, WING A-1 GR. FLR., Juchandra, Vasai, Thane, Maharashtra, India, 401208. The Company is listed on the Bombay Stock Exchange (BSE).
b. Significant Accounting Policies followed by the companyi. Basis of preparation1. Compliance with IND AS
These financial statements have been prepared in accordance with the Indian Accounting Standards (hereinafter referred to as the 'Ind AS') as notified by Ministry of Corporate Affairs pursuant to Section 133 of the Companies Act, 2013 ('Act') read with of the Companies (Indian Accounting Standards) Rules, 2015 and other relevant provisions of the Act.
The accounting policies are applied consistently to all the periods presented in the financial statements.
2. Current / Non-current classification
The Company presents assets and liabilities in the balance sheet based on current / non-current classification.
? An asset is treated as current when it is:
• Expected to be realised or intended to be sold or consumed in normal operating cycle, or
• Held primarily for the purpose of trading, or
• Expected to be realised within twelve months after the reporting period, or
• Cash or cash equivalent unless restricted from being exchanged or used to settle a liability for at least twelve months after the reporting period.
The Company classifies all other assets as non-current.
? A liability is current when:
• It is expected to be settled in normal operating cycle, or
• It is held primarily for the purpose of trading, or
• It is due to be settled within twelve months after the reporting period, or
• There is no unconditional right to defer the settlement of the liability for at least twelve months after the reporting period
The Company classifies all other liabilities as non-current.
? Deferred tax assets and liabilities are classified as non-current assets and liabilities.
The operating cycle is the time between the acquisition of assets for processing and their realisation in cash and cash equivalents. The company has identified twelve months as its operating cycle.
ii. Property, Plant and Equipment
Property, Plant and Equipment are stated at cost, net of recoverable taxes, trade discount and rebates less accumulated depreciation and impairment losses, if any. Such cost includes purchase price, borrowing cost and any cost directly attributable to bringing the assets to its working condition for its intended use.
Depreciation on Property, Plant and Equipment is providing using written down value method on depreciable amount. Depreciation is provided based in useful life of the assets as prescribed in Schedule II to the Companies Act, 2013.
iii. Lease
The Company, as a lessee, recognizes a right-of-use asset and a lease liability for its leasing arrangements, if the contract conveys the right to control the use of an identified asset. Initially the right-of-use assets measured at cost which comprises initial cost of the lease liability adjusted for any lease payments made at or before the commencement date plus any initial direct costs incurred.
The Company paid the lease liability on the commencement date. The right-of-use assets is depreciated using the straight-line method from the commencement date over the lease term.
iv. Cash and Cash Equivalents
For the purpose of presentation in the statement of cash flows, cash and cash equivalents include cash on hand, cheques on hand, other short-term highly liquid investments with original maturities of three months or less that are readily convertible to known amounts of cash and which are subject to an insignificant risk of changes in value.
v. Inventories
Traded Goods have been valued at lower of cost and net realisable value. The cost of inventories shall comprise all costs of purchase, costs of conversion and other costs incurred in bringing the inventories to their present location and condition. NRV is the estimated selling price in the ordinary course of business less the estimated cost of completion and estimated cost necessary to make the sale.
Provision is made for obsolete, slow moving and defective stocks, wherever necessary.
vi. Investments and other financial assets 1. Classification
The company classifies its financial assets in the following measurement categories:
i. those to be measured subsequently at fair value (either through other comprehensive income, or through the Statement of Profit and Loss), and
ii. those measured at amortised cost.
The classification depends on the company's business model for managing the financial assets and the contractual terms of the cash flows.
2. Measurement
For purposes of subsequent measurement, the Company classifies its financial assets in the following measurement categories:
i. those to be measured subsequently at fair value (either through other comprehensive income, or through profit or loss), and
ii. those measured at amortized cost.
The classification depends on the entity’s business model for managing the financial assets and the contractual terms of the cash flows. For assets measured at fair value, gains and losses will either be recorded in profit or loss or other comprehensive income. For investments in debt instruments, this will depend on the business model in which the investment is held. For investments in equity instruments, this will depend on whether the Company has made an irrevocable election at the time of initial recognition to account for the equity investment at fair value through other comprehensive income.
Equity investments:
The Company accounts for investments in equity instruments at cost, as the amounts involved are nominal and management believes that the carrying amount is a reasonable approximation of fair value. Accordingly, such investments are carried at cost less impairment, if any. Management assesses these investments for indicators of impairment at each reporting date and recognizes an impairment loss where the carrying amount exceeds the recoverable amount. Dividends from such investments are recognised in profit or loss as other income when the Company’s right to receive payments is established. Changes in the fair value of financial assets at fair value through profit or loss are recognised in the statement of profit and loss. Impairment losses (and reversal of impairment losses) on equity investments measured at FVOCI are not reported separately from other changes in fair value.
3. Impairment of financial assets
The company measures the expected credit loss associated with its assets based on historical trend, industry practices and the business environment in which the entity operates or any other appropriate basis. The impairment methodology applied depends on whether there has been a significant increase in credit risk.
For Trade Receivables only, the company applies the simplified approach permitted by Ind AS 109 Financial Instruments, which requires expected lifetime losses to be recognised from initial recognition of the receivables.
4. De-recognition of financial assets
A financial asset is de-recognised only when:
- The company has transferred the rights to receive cash flows from the financial asset or
- retains the contractual rights to receive the cash flows of the financial asset, but assumes a contractual obligation to pay the cash flows to one or more recipients.
Where the entity has transferred an asset, the company evaluates whether it has transferred substantially all risks and rewards of ownership of the financial asset. In such cases, the financial asset is derecognised. Where the entity has not transferred substantially all risks and rewards of ownership of the financial asset, the financial asset is not derecognised.
Where the entity has neither transferred a financial asset nor retains substantially all risks and rewards of ownership of the financial asset, the financial asset is derecognised if the company has not retained control of the financial asset. Where the company retains control of the financial asset, the asset is continued to be recognised to the extent of continuing involvement in the financial asset.
vii. Impairment of non-financial assets
Assets are tested for impairment whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. An impairment loss is recognised for the amount by which the asset's or cash generating unit's carrying amount exceeds its recoverable amount and is recognised in the Statement of Profit and Loss. The recoverable amount is the higher of an asset's fair value less costs of disposal and value in use. For the purpose of assessing impairment, assets are grouped at the lowest levels for which there are separately identifiable cash inflows which are largely independent of the cash inflows from other assets or company of assets (cash-generating units). Nonfinancial assets that suffered an impairment are reviewed for possible reversal of the impairment at the end of each reporting period.
viii. Financial liabilities1. Classification
Debt and equity instruments issued by the Company are classified as either financial liabilities or as equity in accordance with the substance of the contractual arrangements and the definition of a financial liability and an equity instrument. An equity instrument is any contract that evidences a residual interest in the assets of an entity after deducting all of its liabilities
2. Measurement
All financial liabilities are recognised initially at fair value and, in the case of loans and borrowings and payables, net of directly attributable transaction costs.
The Company’s financial liabilities include trade and other payables, loans and borrowings including bank overdrafts, financial guarantee contracts and derivative financial instruments.
3. Subsequent Measurement
The measurement of financial liabilities depends on their classification, as described below:
a. Borrowings:
Borrowings are subsequently carried at amortized cost; any difference between the proceeds (net of transaction costs) and the redemption value is recognized in the statement of profit and loss over the period of the borrowings using the
effective interest method. Fees paid on the establishment of loan facilities are recognized as transaction costs of the loan to the extent that it is probable that some or all of the facility will be drawn down. In this case, the fee is deferred until the draw-down occurs. To the extent there is no evidence that it is probable that some or all of the facility will be drawn down, the fee is capitalized as a pre-payment for liquidity services and amortized over the period of the facility to which it relates
b. Trade and other payable:
These amounts represent obligations to pay for goods or services that have been acquired in the ordinary course of business from suppliers. Trade and payables are subsequently measured at amortized cost using the effective interest method.
4. De-recognition:
A financial liability is de-recognised when the obligation under the liability is discharged or cancelled or expires. When an existing financial liability is replaced by another from the same lender on substantially different terms, or the terms of an existing liability are substantially modified, such an exchange or modification is treated as the de-recognition of the original liability and the recognition of a new liability. The difference in the respective carrying amounts is recognised in the statement of profit or loss.
ix. Revenue recognition
The Company primarily engage in the manufacture, processing, market, trade, import, export of pharmaceuticals, medicinal chemical and other related products. It recognizes revenue from sales effected directly, is recognized on issue of invoices (on delivery of goods) except sales on consignment.
x. Income tax
Income tax expense comprises current and deferred income tax. Income tax expense is recognized in net profit in the statement of profit and loss except to the extent that it relates to items recognized directly in equity, in which case it is recognized in other comprehensive income. Current income tax for current and prior periods is recognized at the amount expected to be paid to or recovered from the tax authorities, using the tax rates and tax laws that have been enacted or substantively enacted by the balance sheet date. Deferred income tax assets and liabilities are recognized for all temporary differences arising between the tax bases of assets and liabilities and their carrying amounts in the financial statements. Deferred tax assets are reviewed at each reporting date and are reduced to the extent that it is no longer probable that the related tax benefit will be realized.
xi. Earnings Per Share
1. Basic earnings per share
Basic earnings per share is calculated by dividing:
- the net profit attributable to owners of the company.
- by the weighted average number of equity shares outstanding during the financial year, adjusted for bonus elements in equity shares issued during the year and excluding treasury shares.
2. Diluted earnings per share
Diluted earnings per share adjusts the figures used in the determination of basic earnings per share to take into account:
- after income tax effect of interest and other financing costs associated with dilutive potential equity shares, and
- the weighted average number of additional equity shares that would have been outstanding assuming the conversion of all dilutive potential equity shares.
xii. Provisions and contingent liabilities
Provisions are recognized when the Company has a present legal or constructive obligation as a result of past events; it is probable that an outflow of resources will be required to settle the obligation; and the amount has been reliably estimated. If the effect of the time value of money is material, provisions are discounted using a current pre-tax rate that reflects, when appropriate, the risks specific to the liability. When discounting is used, the increase in the provision due to the passage of time is recognized as a finance cost.
1. Contingent liabilities
Contingent liabilities are disclosed when there is a possible obligation arising from past events, the existence of which will be confirmed only by the occurrence or nonoccurrence of one or more uncertain future events not wholly within the control of the Company. A present obligation that arises from past events where it is either not probable that an outflow of resources will be required to settle or reliable estimate of the amount cannot be made, is termed as contingent liability.
2. Contingent Assets
Contingent assets is disclosed where an inflow of economic benefit is probable.
xiii. Employee benefits1. Short-term obligations
All employee benefits payable wholly within twelve months of rendering the service including performance incentives and compensated absences are classified as short term employee benefits. The undiscounted amount of short-term employee benefits expected to be paid in exchange for the services rendered by employees are charged off to the Statement of Profit and Loss/ Capital Work-in-Progress, as applicable. The employee benefits which are not expected to occur within twelve months are classified as long term benefits and are recognised as liability at the net present value.
2. Defined contribution plan
Contributions to defined contribution schemes such as provident fund, Employees State Insurance and Pension Plans are charged off to the Statement of Profit and Loss, as applicable, during the year in which the employee renders the related service.
c. Critical estimates and judgements
The preparation of financial statements requires the use of accounting estimates which, by definition, will seldom equal the actual results. Management also need to exercise judgement in applying the company's accounting policies.
This note provides an overview of the areas that involved a higher degree of judgement or complexity, and of items which are more likely to be materially adjusted due to estimates and assumptions turning out to be different than those originally assessed. Detailed information about each of these estimates and judgements is included in relevant notes together with information about the basis of calculation for each affected line item in the financial statements.
The areas involving critical estimates or judgement are:
Estimation of tax expenses, utilisation of deferred tax assets (including MAT credit) and tax payable.
2. Notes on Financial Statements
1) In compliance with the requirement of the proviso to rule 3(1) of the Companies (Accounts) Rules, 2014, the management has represented that the company is in the process of implementing the audit trail feature required under the Companies Act, 2013. This feature will provide an edit log of all transactional changes, capturing modifications along with the date and details. The company expects the implementation to be completed soon.
2) Corporate Information & Regulatory Status:
The Company received approval for a change in its name and main objects from the Registrar of Companies (ROC) during the financial year 2023-24 in the month of November 2023. As of March 31, 2026, the process of updating these changes with the Bombay Stock Exchange (BSE) is in progress. The Company’s securities continue to be traded under the former name on the BSE portal. The Company has received certain queries/notices from the Stock Exchange regarding the procedural requirements for the name and objective change, to which the Company is currently responding. No material financial penalty has been levied on the Company as of the date of these financial statements.
3) In most of the cases, the company has not received confirmation from the parties grouped under trade receivables, trade payables, loans & advances. These balances have, therefore been taken as per the books subject to reconciliation & adjustments, if any.
|