1 Corporate Information
Arfin India Limited (the “Company") is a public Company domiciled in India and incorporated under the
provisions of Companies Act, 1956. Its Equity Shares are listed on BSE Limited. The registered office of the
Company is located at Plot No. 117, Ravi Industrial Estate, Billeshwarpura, Chhatral, Tal. - Kalol, Dist. -
Gandhinagar-382729, Gujarat, India.
The Company is engaged in the business of manufacturing, trading and selling of various Ferrous & non¬
ferrous metal products and its manufacturing facilities are located at Chhatral, Dhanot and Vadaswami in the
State of Gujarat. The Company has branch office at Raigarh in the State of Maharashtra. The Company caters
to both domestic as well as international markets.
The Standalone Financial Statements for the financial year ended March 31,2025 have been approved by the
Board of Directors of the Company in its meeting held on May 23, 2025.
2.1 Basis of Preparation of Standalone Financial Statements
Compliance with IND AS
These Standalone Financial Statements have been prepared in accordance with the Indian Accounting
Standards (hereinafter referred to as the ‘IND AS’) as notified by the Ministry of Corporate Affairs pursuant to
Section 133 of the Companies Act, 2013 (‘Act’) read with the Companies (Indian Accounting Standards) Rules,
2021 as amended and other relevant provisions of the Act.
Historical Cost Convention
The Standalone financial statements have been prepared on a historical cost basis, except for the following:
i) Certain financial assets and liabilities that are measured at fair value or amortized cost;
ii) Defined benefit plans - plan assets are measured at fair value less present value of defined benefit
obligations.
Current and Non-Current Classification
All assets and liabilities have been classified as current or non-current as per the Company’s normal operating
cycle (twelve months) and other criteria set out in the Schedule III to the Act.
Rounding off of Amounts
All amounts disclosed in the Standalone Financial Statements and notes have been rounded off to the nearest
rupees in lakh as per the requirement of Schedule III, unless otherwise stated.
2.2 Use of Estimates
The estimates and judgenments used in the preparation of the Standalone Financial Statements are
continuously evaluated by the Company and are based on historical experience and various other
assumptions and factors (including expectations of future events) that the Company believes to be reasonable
under the existing circumstances. Differences between actual results and estimates are recognized in the
period in which the results are known / materialized. The said estimates are based on the facts and events, that
existed as at the reporting date, or that occurred after that date but provide additional evidence about
conditions existing as at the reporting date.
2.3 Property, Plant & Equipment
Property, plant and equipment are stated at cost, net of recoverable taxes, less depreciation and impairment
losses, if any. Such cost includes purchase price, borrowing cost and other cost directly attributable to the
acquisition of the items.
Subsequent costs are included in the asset’s carrying amount or recognized as a separate asset, as
appropriate, only when it is probable that future economic benefits associated with the item will flow to the
Company and the cost of the item can be measured reliably. The carrying amount of any component accounted
for as a separate asset is derecognized when replaced. All other repairs and maintenance are charged to the
Statement of Profit and Loss during the reporting period in which they are incurred.
Depreciation methods, estimated useful lives and residual value
Depreciation is provided on a Straight-Line Method over the estimated useful lives of assets.
The Company depreciates its property, plant and equipment over the useful life in the manner prescribed in
Schedule II to the Act, and the management believes that useful life of assets are same as those prescribed in
the Schedule II to the Act.
The residual values are not more than 5% of the original cost of the asset. The assets residual values and
useful lives are reviewed and adjusted if appropriate, at the end of each reporting period.
The carrying amount of an item of property, plant and equipment is derecognized on disposal or when no future
economic benefits are expected from its use or disposal. The gain or loss arising from the de-recognition of an
item of property, plant and equipment is measured as the difference between the net disposal proceeds and the
carrying amount of the item and is recognized in the Statement of Profit and Loss when the item is
derecognized.
Capital Work-In-Progress and Capital Advances
Cost of assets not ready for intended use, as on the Balance Sheet date is shown as capital work in progress.
Advances given towards acquisition of fixed assets outstanding at Balance Sheet date are disclosed as Other
Current Assets.
2.4 Intangible Assets
Computer software are stated at cost, less accumulated amortization and impairments, if any.
Amortization Method and Useful Life
The Company amortizes computer software using the straight-line method over the period of 5 years. Gains
and losses on disposals are determined by comparing proceeds with carrying amount. These are included in
the Statement of Profit and Loss.
2.5 Inventories
Items of inventories of Raw Material, Finished goods, WIP, Spares and Stores, Packing Material & Fuel are
valued at lower of cost or net realizable value except waste which is valued at estimated net realizable value.
Raw Material cost of inventories comprises of cost of purchase and other costs incurred in bringing the
inventories to their present location and condition. Finished goods cost of inventories comprises of cost of
purchase, cost of conversion and other costs including manufacturing overheads incurred in bringing them to
their respective present location and condition.
2.6 Financial Instruments
(i) Initial Recognition and Measurement
The Company recognizes financial assets and liabilities when it becomes a party to the contractual
provisions of the instrument. All financial assets and liabilities are recognized at fair value on initial
recognition, except for trade receivables which are initially measured at transaction price. Transaction
costs that are directly attributable to the acquisition or issue of financial assets and liabilities that are not at
fair value through profit or loss are added to the fair value on initial recognition. Regular way of purchase
and sale of financial assets are recognized on the trade date.
(ii) Subsequent Measurement
A. Non-Derivative Financial Instrument
(a) Financial Assets Carried at Amortized Cost
A financial asset is subsequently measured at amortized cost if it is held within a business model whose
objective is to hold the asset in order to collect contractual cash flows and the contractual terms of the
financial asset give rise on specified dates to cash flows that are solely payments of principal and
interest on the principal amount outstanding.
(b) Financial Assets at Fair Value through Other Comprehensive Income
A financial asset is subsequently measured at fair value through other comprehensive income if it is
held within a business model whose objective is achieved by both collecting contractual cash flows and
selling financial assets and the contractual terms of the financial asset give rise on specified dates to
cash flows that are solely payments of principal and interest on the principal amount outstanding.
The Company has made an irrevocable election for its investments which are classified as equity
instruments to present the subsequent changes in fair value in other comprehensive income based on
its business model. Further, in cases where the Company has made an irrevocable election based on
its business model, for its investments which are classified as equity instruments, the subsequent
changes in fair value are recognized in other comprehensive income.
(c) Financial Assets at Fair Value through Profit or Loss
A financial asset which is not classified in any of the above categories is subsequently fair valued
through profit or loss.
(d) Financial Liabilities
Financial liabilities are subsequently carried at amortized cost using the effective interest method,
except for contingent consideration recognized in a business combination which is subsequently
measured at fair value through profit and loss. For trade and other payables maturing within one year
from the Balance Sheet date, the carrying amounts approximate fair value due to the short maturity of
these instruments.
B. Derivative Financial Instruments
The Company holds derivative financial instruments such as foreign exchange forward and option contracts
to mitigate the risk of changes in exchange rates on foreign currency exposures. The counterparty for these
contracts is generally a bank.
Financial Assets or Liabilities, at Fair Value through Profit or Loss
This category has derivative financial assets or liabilities which are not designated as hedges. Although the
Company believes that these derivatives constitute hedges from an economic perspective, they may not
qualify for hedge accounting under IND AS 109, Financial Instruments. Any derivative that is either not
designated as hedge, or is so designated but is ineffective as per IND AS 109, is categorized as a financial
asset or financial liability, at fair value through profit or loss.
Derivatives not designated as hedges are recognized initially at fair value and attributable transaction costs
are recognized in net profit in the Statement of Profit and Loss when incurred. Subsequent to initial
recognition, these derivatives are measured at fair value through profit or loss and the resulting exchange
gains or losses are included in other income. Assets / liabilities in this category are presented as current
assets / liabilities if they are either held for trading or are expected to be realized within 12 months after the
balance sheet date.
C. De-Recognition of Financial Instruments
The Company derecognizes a financial asset when the contractual right to receive the cash flows from the
financial asset expires or it transfers the financial asset.
A financial liability is derecognized when the obligation under the liability is discharged, cancelled or expired.
2.7 Current versus Non-Current Classification
An asset is considered as current when it is:
• expected to be realized or intended to be sold or consumed in normal operating cycle;
• held primarily for the purpose of trading;
• expected to be realized 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.
All other assets are classified as non-current.
A liability is considered as current when it is:
• expected to be settled in normal operating cycle;
• held primarily for the purpose of trading;
• 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.
All other liabilities are classified as non-current.
Deferred tax assets and liabilities are classified as non-current assets and liabilities respectively.
2.8 Measurement of Fair Value
Fair value is the price that would be received on sell of an asset or paid to transfer a liability in an orderly
transaction between market participants at the measurement date. The fair value measurement is based on
the presumption that the transaction to sell the asset or transfer the liability takes place either:
• in the principal market for the asset or liability; or
• in the absence of a principal market, in the most advantageous market for the asset or liability.
The principal or the most advantageous market must be accessible by the Company.
The fair value of an asset or a liability is measured using the assumptions that market participants would use
when pricing the asset or liability, assuming that market participants act in their economic interest.
A fair value measurement of a non-financial asset takes into account a market participant’s ability to generate
economic benefits by using the asset in its highest and best use or by selling it to another market participant that
would use the asset in its highest and best use.
The Company uses valuation techniques that are appropriate in the circumstances and for which sufficient data
are available to measure fair value, maximizing the use of relevant observable inputs and minimizing the use of
unobservable inputs.
All assets and liabilities for which fair value is measured or disclosed in the Standalone financial statements are
categorized within the fair value hierarchy, described as follows, based on the lowest level input that is
significant to the fair value measurement as a whole:
• Level 1- Quoted (unadjusted) market prices in active markets for identical assets or liabilities.
• Level 2 - Valuation techniques for which the lowest level input that is significant to the fair value
measurement is directly or indirectly observable.
• Level 3 - Input for the asset or liability those are not based on observable market data (unobservable inputs).
2.9 Investments and Other Financial Assets
Classification
The Company classifies its financial assets in the following measurement categories:
• Those to be measured subsequently at fair value (either through Other Comprehensive Income, or through
the Statement of Profit and Loss), and
• Those measured at amortized cost.
The classification depends on the Company’s business model for managing the financial assets and the
contractual terms of the cash flows.
Measurement
At initial recognition, the Company measures a financial asset at its fair value. Transaction costs of financial
assets are expensed out in the Statement of Profit and Loss.
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.
2.10 Revenue Recognition
Revenue is measured at the value of the consideration received or receivable. Amounts disclosed as revenue
are net of returns, trade allowances, rebates, discounts, GST and amounts collected on behalf of third parties.
The Company recognizes revenue when the amount of revenue can be reliably measured. It is probable that
future economic benefits will flow to the Company and specific criteria have been met for each of the
Company’s activities as described below:
Sale of Goods
Sales are recognized when substantial risk and rewards of ownership are transferred to customers. In case of
domestic customer, generally sales take place when goods are dispatched or delivery is handed over to
transporter. In case of export customers, generally sales take place when goods are shipped on board based
on bill of lading.
Other Operating Revenue
Export Incentives under various schemes are accounted in the year in which right to receive is irrevocably
established.
OtherRevenue
Interest income is recognized on a time proportion basis taking into account the amount outstanding and the
applicable rate of interest.
Revenue in respect of insurance / other claims etc. is recognized only when it is reasonably certain that the
ultimate collection will be made.
Dividend
Dividends are generally recognized in the Statement of Profit and Loss only when the right to receive payment
is established.
2.11 Foreign Currency Transactions
The Standalone financial statements are presented in Indian Rupee (INR), which is Company’s functional and
presentation currency.
Foreign currency transactions are accounted for at the exchange rate prevailing on the date of the transaction.
All monetary foreign currency assets and liabilities are converted at the exchange rates prevailing on the date
of the Balance Sheet. All exchange differences other than those relating to the acquisition of fixed assets from
outside India are dealt with in the Statement of Profit and Loss. Exchange gain or loss relating to fixed assets
acquired from outside India is adjusted in the cost of respective fixed assets. All non-monetary items are
measured at historical cost basis.
In case of forward contracts, the gain / loss on contracts are treated as periodical expense or revenue. Any profit
or loss arising on the cancellation or renewal of a forward exchange contract is recognized as income or
expense for the year, except in case of a forward exchange contract relating to liabilities incurred for acquiring
fixed assets from outside India, in which case, such profit or loss is adjusted in the cost of fixed assets.
Exchange difference is calculated as the difference between the foreign currency amount of the contract
translated at the exchange rate at the reporting date, or the settlement date where the transaction is settled
during the reporting period, and the corresponding foreign currency amount translated at the later of the date of
inception of the forward exchange contract and the last reporting date. Such exchange differences are
recognized in the Statement of Profit and Loss in the reporting period in which the exchange rates change.
2.12 Income Tax
The income tax expense or credit for the period is the tax payable on the current period’s taxable income based
on the applicable income tax rate adjusted by changes in deferred tax assets and liabilities attributable to
temporary differences and to unused tax losses.
Deferred income tax is provided in full, using the liability method on temporary differences arising between the
tax bases of assets and liabilities and their carrying amount in the Standalone financial statements. Deferred
income tax is determined using tax rates (and laws) that have been enacted or substantially enacted by the end
of the reporting period and are expected to apply when the related deferred income tax asset is realized or the
deferred income tax liability is settled.
Deferred tax assets are recognized for all deductible temporary differences and unused tax losses, only if, it is
probable that future taxable amounts will be available to utilize those temporary differences and losses.
Deferred tax assets and liabilities are offset when there is a legally enforceable right to offset current tax assets
and liabilities and when the deferred tax balances relate to the same taxation authority. Current tax assets and
tax liabilities are offset where the Company has a legally enforceable right to offset and intends either to settle
on a net basis, or to realize the asset and settle the liability simultaneously.
Current and deferred tax is recognized in the Statement of Profit and Loss, except to the extent that it relates to
items recognized in other comprehensive income or directly in equity. In that case, the tax is also recognized in
Minimum Alternate Tax credit is recognized as deferred tax asset only when and to the extent there is
convincing evidence that the Company will pay normal income tax during the specified period. Such asset is
reviewed at each Balance Sheet date and the carrying amount of the MAT credit asset is written down to the
extent there is no longer a convincing evidence to the effect that the Company will pay normal income tax
during the specified period.
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