4. Summary of significant accounting policies

4.1 Property, Plant and Equipment {PPE)and depreciation and amortisation:

i) Recognition and Measurement:

I terns of property,, plant, and equipment are measured at cost less accumulated depreciation and impairment
losses, if any. The cost of an item of property, plant and equipment comprises:

Ý its purchase price, including import duties and non-refundable purchase taxes, after deducting trade discounts
and rebates; and

Ý Any costs directly attributable to bringing the asset to the location and condition necessary for it to be capable of
operating in the manner intended by management.

If significant parts of an item of property, plant and equipment have different useful lives, then they are accounted
for as separate items [major components) of property, plant and equipment.

An asset under construction includes the cost of property, pEant and equipment that are not ready to use at the
balance sheet date. Advances paid to acquire property; Dlant and equipment before the balance sheet date are
disclosed under other non-current assets. Assets under construction are not depreciated as these assets are not yet
ready for use.

ii) Subsequent expenditure

Subsequent expenditure is capitalised onfy if it is probable that the future economic benefits associated with the
expenditure wiSI flow to the Company and the cost of the expenditure car be measured reliably,

iii) Depreciation and amortisation

Depreciable amount for assets is the cost of an asset, or other amount substituted for cost, less its estimated residual
value.

Depreciation on property, plant and equipment of the Company has been provided using the straight-line method
based on the useful lives specified in Schedule II to the Companies Act, 2013.

iv) De-recognition:

An item of property, plant and equipment is derecognized upon disposal or when no future economic benefits are
expected to arise from continued use of the asset. Any gain or loss arising on the disposal or retirement of property,
plant and equipment is determined as the difference between the sale proceeds and the carrying amount of the
assets and is recognized in Statement of Profit and Loss.

4,2 Intangible assets and amortisation

i) Recognition and measurement:

Items of Intangible Assets are measured at cost less accumulated amortisation and impairment losses, if any. The cost
of intangible assets comprises:

¹ its purchase price, including import duties and non-refun da bie purchase taxes, after deducting trade discount sand
rebates; and

¹ Any costs directly attributable to bringing the asset to the location and condition necessary for it to be capable of
operating in the manner intended by management.

Gains or iosses arising from de-recognition of an intangible asset are measured as the difference between the net
disposal proceeds and the carrying amount of the asset and are recognized in the Statement of Profit and Loss when
the asset is derecognized

ii) Subsequent expenditure

Subsequent expenditure is capitalised only if it is probable that the future economic benefits associated with the
expenditure will flow to the Company and the cost of the expenditure can be measured reliably.

Hi) Amortisation

The intangible assets of the Company are assessed to be of finite lives and are amortized over the usefui economic life
and assessed for impairment whenever there is an indication that the intangible asset may he impaired., The Company
reviews amortization period on an annual basis, Intangible assets are amortized on straight line basis in accordance with
IND AS 36 and Schedule II to the Companies Act, 2013 or based on technical estimates.

A summary of the policies applied to the Company's Intangibles is, as follows:

43 Impairment of non-financial assets

The tarrying valuer of assets/cash generating units at each balance sheet date are reviewed for impairment if any
indication of impairment exists. If the carrying amount of the assets exceeds the estimated recoverable amount, an
impairment loss is recognised for such excess amount The impairment loss is recognised as an expense in the
Statement of Profit and Loss, unless the asset is carried at revalued amount, in which case any impairment loss of the
revalued asset is treated as a decrease to the extent a revaluation reserve is available for that asset.

The recoverable amount is the greater of the net selling price and the value in use. Value in use is arrived at by
discounting the future cash flows to their present value based on an appropriate discount factor. When there is
indication that an impairment loss recognised for an asset (other than a revalued asset) in earlier accounting periods
which no longer exists or may have decreased, such reversal of impairment loss is recognised in the Statement of
Profit and Loss, to the extent the amount was previously charged to the Statement of Profit and Loss. In case of
revalued assets, such reversal is not recognised.

4.4 Foreign currency transactions

Transactions in foreign currencies are translated into the Company's functional currency at exchange rates at the
dates of the transactions. Monetary assets and liabilities denominated in foreign currencies at the reporting date are
tra nsf a ted into the f u nctiona I c u rra mcy at the exc hangs fate a t th at da t e.

Non-monetary assets and liabilities that are measured based on historical cost in a foreign currency are translated at
the exchange rate at the date of the transaction.

Exchange differences arising on the settlement of monetary items or on translating monetary' items at rates different
from those at which they were translated on initial recognition during the period or in previous Consolidated financial
statements are recognised in the Statement of Profit and Loss in the period in which they are settled

4.5 Financial Instruments

I. Financial assets

Classification

The Company classifies financial assets as subsequently measured at amortised cost, fair vafue through other
comprehe nsive i ncome or fair value throu gh profit or I oss based on its bu s i ness model for ma na g i ng the fin a ncial
assets and the contractual cash flow characteristics of the financial asset.

Initial recognition and measurement

Trade receivables and debt securities issued are initially recognised when they originate.

The Company recognises financial assets (other than trade receivables and debt securities) when it becomes ?
party to the contractual provisions of the instrument, Alt financial assets are recognised initially at fair value plus
transaction costs that are attributable to the acquisition of the financial asset.

Subsequent measurement

For subsequent measurement, the financial assets are classified in three categories;

« Equity investments
Equity investments

AH equity investments other than investment in subsidiaries, joint ventures and dSSuaate are measured at fair
value. For ah other equity instrument!!, the Company decides to classify the same at fair value through other
Comprehensive income (FVTQCI). The Company makes Such election on an mStru ment-by-instrument basis. The
classification is made on initial recognition and is irrevocable.

The Company decides to classify an equity instrument as at FVTOO, then all fair value changes on the instrument,
excluding dividends, are recognised in other comprehensive income (OCT). There is no recycling of the amounts
from OCI to the Statement of Profit and Loss, even on safe of such investments

Derecognition

A financial asset (or, where applicable, a part of a financial asset) is primarily derecognised when:

(a) The rights to receive cash flows from the asset have expired, or

(b) The Coinpfiny has transferred substantially ail the risks and rewards of the asset or

(c) “he Company has neither transferred nor retained substantially all the risks and rewards of the asset but has
transferred control of the asset.

Impairment of financial assets

The Company applies ‘simplified approach' measurement ahd recognition of impairment loss on the following
financial assets and credit risk exposure:

a) financial assets that are debt instruments, and are measured at amortised coste.g., loans, debt securities,
deposits, and bank balance.

b) Trade receivables.

The application of simplified approach does not require the Company to track changes in credit risk. Rather, it
recognises impairment loss allowance based on lifetime Expected Credit Loss at each reporting date, right from
its initial recognition.

II, Financial Liabilities

Classification

The Company classifies all finaneiai liabilities as subsequently measured at amortised cost
Initial recognition and measurement

Al I: fi nan da 11 labi lities are recog ni sed i nitially at fair va I ue a nd, i n the case of I oa ns an d bo rrovuin gs a nd pays bles,
net of directly attributable transaction costs.

Loans and borrowings

After initial recognition, interest-bearing loans and borrowings are subsequently measured at amortised cost
using the Effective Interest Rate {E1R} method. Gams and losses are recognised in the Statement of Profit and
Loss when the liabilities are derecognised.

Amortised cost is calculated by taking into account any discounter premium on acquisition and transactions
costs. The FIR amortisation is included as finance costs in the Statement of Profit and Loss.

f h i s category g enera Ply a p pi ies to foa n s a n d borrowi n g s.

Derecognition

A financial liability is derecognised 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
derecognition of the original liabilrty and the recognition of a new liability. The difference in the respective
carrying amounts is recognised iirthe Statement of Profit and Loss,

111,Offsetting of financial instruments

Financial assets and financial liabilities are offset, and the net amount is reported in the balance sheet if there: is
a n enf o rcea ble lega I rig ht to offset the recogn i sed amou nts a nd th e re is a n i nte nti o n to settl e them on a net basi s
onto realise tbeassetsand settle the liabilities simultaneously.

4.6 Revenue recognition

The Company derives its revenue primarily from its core business operations, including the safe of goods and/or
rendering of services, as applicable.

Revenue from' services is recognised as they are rendered based on agreements/arrangements with the concerned
parties and recognised net of Goods and Service Tax (GSTHas applicable),

The Compa ny recogni ses ceven ue when it satisfies a performance obligation by transferring control of a good or
service to the customer. Control is considered transferred when the customer has the ability to direct the use of and
ob tai n su bsta nhally a 11 of the rema i n m g be nef its fro m ih e asset. Reven ue i s recog n i sed eith er at a point in time or over
time, based cm the nature of the performance obligation and enforceability of the right to payment for performance
completed to date,

Revenue is measured at the fair value of consideration received or receivable considering of discounts, incentives,
volume rebates, and outgoing taxes on sales. Any amounts receivable from the customers are recognised as revenue
after t he co ntro I over th e go ods sold a re tea referred to th e cu stom er wh i ch i s g enera Ely o n d i s patch ot good s.

Interest income

Interest income is accounted on an accrual basis at effective interest rate. Interest on delayed payment and forfeiture
income are accounted based upon underlying agreements with customers.

4.7 Leases

At the inception of a contract, the Company assesses whether a contract is or contains, a lease. A contract is or
conta i ns a I ea se if the c on tra ct co nveys the rig ht to cont ro I the u se of a n i dentif ied asset for a period of ti me i n exch a ng e
of cons i d e ration. To asses s wheth era con tract convey s t he ri g ht to co n tro I the u se o f a n a ss et the Com p a ny assesses
whether:

* The contracts involve the use of an identified asset - this may be specified explicitly or implicitly and should be
physically distinct or represent substantially ail of the capability of a physical distinct asset. If the supplier has a
substantive substitution right, then the asset is not identified

* The Company has the right to obtain substantially all of the economic benefits from use of the asset throughout the
period of use; and

* The Company has the right to directthe use of the asset The Company has this right when it has the decision¬
making rights that arp most relevant to changing how and for what purpose the asset is used.

As a lessee

Right-of-use Asset

The Company recognises a right-of-use asset and a lease liability at the lease commencement date. At the
commencement date, a lessee shall measure the right-of-use asset at cost which comprises Initial measurement, of
the lease liability, any lease payments made at or before the commencement date, less any lease incentives received,
any Initial direct Costs incurred by the lessee; and an estimate of costs tu be incurred by the lessee In dismantling and
removing the underlying asset, restoring the site on which it is located or restoring the underlying asset to the condition
required by the terms and conditions of the lease.

Lease Liability

At the commencement dale, a lessee shall measure the lease liability at the present value of the lease payments that
are not paid at that date. The lease payments shall be discounted using the interest rate implicit in the lease, if that
rate can be readily determined. If that rate cannot be readily determined, the lessee shall use the lessee's Incremental
borrowing rate.

Short-term lease and leases of low-value assets

The Company has elected not to recognise right-of-use assets arid lease liabilities for short-term leases that have a
lease term of leS$ than 1 2 months Dr leSs and leases of low-value assets. The Company recognises the lease payments
associated with these leases as an expense On a straight-line basis Over the lease term.

The election for short-term leases shall be made by class of underlying asset to which the right of use relates. A class
of u nde riyincj asset i s a g rou pi n g of u nd erlyi ng a ssets of a s i mila r nature and use i n Co rrtp a ny¹ s o perations. The e lectio n
for leases for which the underlying asset is of low value can be made on a lease-by-lease basis.

4.8 income tax

income tax expense comprises current tax and deferred tax. It is recognised in the Statement of Profit and Loss except
to the extent that it relates to items recognised directly in equity or in OCI.

Current tax

CurrenL tax comprises the expected lax payable or receivable on ihe taxable income or loss for the year and any
adjustment to the tax payableor receivable in respecl of previous years. It is measured using lax rates enacted or
substantively enacted aL the reporting date.

Current tax assets and liabilities are offset only if, the Company:

a} Has a legally enforceable right to set off the recognised amounts; and

Deferred tax

Deferred tax is recognised in respect of temporary differences between the carrying amounts of assets and liabilities
for financial reporting purposes and the amounts used for taxation purposes. Deferred tax assets are recognised for
u n used tax I osses, un u sed tax credits a nd ded ucti to I e temp o ra ry diff eren ces to the extent t here i s co nv i nc i n g ev idence
that sufficient taxable profit will be available against which such deferred tax asset can he realised.

Deferred tax assets arc reviewed at each reporting date and are reduced to the extent that it is no longer probable
that the related tax benefit will be realised; such reductions are reversed when the probability of future taxable
profits improves. Deferred tax liabilities are recognised for taxable temporary differences

Unrecognised deferred Lax assets are reassessed at each reporting date and recognised to Lhe extenL that iL has
become probable that future taxable profits will be available against which they can be used.

Deferred tax is measured at the tax rates that are expected to be applied to temporary differences when they
reverse, using tax rates enacted or substantively enacted at the reporting date.

Deferred tax assets and liabilities are measured at the tax rates that are expected to apply in the year when the asset
is realised or the liability is settled, based on tax rates (and tax laws}, that have been enacted or substantively
enacted at the reporting date.

Deferred tax, relating to items recognised outside profit or loss, is recognised outside profit or loss (either in Other
Comp re h en srve In come or i n other equity). Deferred tax items are reco gn i sed i n correct ion to the u nderlyi ng transacts n
either in OCI or directly in other equity.

Deferred tax assets and deferred tax liabilities are offset, if a legally enforceable right exists to set off current tax
assets against current tax liabilities, and the deferred taxes relate to the same taxable entity and the same taxation
authority.

4.9 Employee benefits

* Sho rt-Term E mpl oyee B e n ef11S

The undiscounted amount of short-term employee benefits expected to be paid in exchange for the services rendered
by employees are recognised as an expense during the period when the employees render the services

Accumulated leave, which is expected to be utilised within the next 12 months, is treated as short-term employee
benefit The Company measures the expected cost of such absences as the additional amount that it expects to pay
as a resu It of the u nu sed entitlement that has a ecu m u Sated at th e re parti ng date, The Co mpa ny recog n i ?es expected
cost of short-term employee benefit as an expense, when an employee renders the related service,

The Company treats accumulated leave expected to be earned forward beyond twelvemonths, as long-term employee
benefit for measurement purposes. Such long-term compensated absences are provided for based on the actuarial
valuation using the projected unit credit method at the leporting date. Actuarial gains/ losses are immediately taken
to the statement of profit and loss and are not deferred. The obligations are presented as current liabilities in the
balance sheet if the entity does not have an unconditional right to defer the settlement for at least twelve months
after the reporting date,

* Post-Employment Benefits

* Defined Contribution Plans

A defined contribution plan is a post employ ment benefit plan under which the Company pays specified contributions
to a separate entity, lhe Company makes specified monthly contri but ions towards Provident fund. The Company's
contribution is recognised as an expense in the Statement of Profit and Loss during the period in which the employee
ren de rs the re I ated se rvi ce. I f t he contri b utio n p aya b le to th e sc h em e f o r service received before the b a I a n ce sh eet
date exceeds the contribution already paid, the deficit payable to the scheme is recognized as a liability after deducting
the contribution already paid.

* Defined Benefits Plans

The Company operates a defined benefit gratuity plan, which requires contributions to be made to Life insurance
Corporation of India

Th e cost of the def i ned b e net it pla n a n d ot her post- employm ent b e nef its a n d the present va I uc of s uch o b I i g a t i o ns
are determined using actuarial valuations toeing carried out at the end of each annual reporting period An actuarial

valuation involves making various assumptions that may differ from actual developments in the future, These include
the determination of the discount rate, future salary increases, mortality rates and future pension increases. Due to
the complexities involved in the valuation and its long-term nature, a defined benefit obligation is highly sensitive to
changes in these assumptions. All assumptions are reviewed at each reporting date,

The Company pays gratuity to the employees whoever has completed five years of service with the Company at the
time of resignatioiVsuperannuation, The gratuity is paid @15 days salary for every completed year of service as per
the Payment of Gratuity Act, 1972,

The liability in respect of gratmty and other post-employment benefits is calculated using the Projected Unit Credit
Method and spread over the period do ring which the benefit is expected to be derived from employees' services.

Remeasuremcints, comprising 6f actuarial gains and losses, the effect of the asset ceiling, excluding amounts included
in net interest on the net defined benefit liability and the return on plan assets (excluding amounts included in net
interest on the net defined benefit liability), are recognised immediately in the balance sheet with a corresponding
debit nr credit to retained earnings through QO in the period in which they occur

Remeasurements are not reclassified to profit or loss m subsequent periods.

Past Service Costs are recognised in profit ur loss on the earlier of

* The date of the plan amendment or curtailment, and

* The date that the Company recognises related restructuring costs.

Net interest is calculated by applying the discount rate to the net defined benefit liability or asset. The Company
recognises the following changes in the net defined benefit obligation as an expense in the consolidated statement of
profit and loss:

Service costs comprising current service costs, past-service costs, gains a net losses on curtailments and non-routine
settlements; and net interest expense or income.

4.10 Borrowing costs

Borrowing cost includes interest expense, amortisation of discounts, hedge - related cost incurred in connection with
f o re ig n cli rrency bo rrowi ngs, an ci Hary costs i nturred i n con necti o n wi th borrow! ng of f u nds a nd exch a rig e d if fe re nee,
arising from foreign currency burrowings to the extent they are regarded as an adjustment to the interest cost.

Borrowing costs, that are attributable to the acquisition or construction or production of a qualifying asset, are
capitalised as partof the cost of such asset till such time the asset is ready for its intended use. A qualifying asset is
an asset that necessarily takes a substantial period to get ready for its intended use.

Ail other borrowing costs are recognised as an expense in the period in which they are incurred.

4.11 Cash and cash equivalents

Cash and cash equivalents in the balance sheet comprise cash at banks and on hand and short-term deposits with an
original maturity of three months or less, which are subject to an insignificant risk of changes in value,

For the Statement of Cash Tlows, cash and cash equivalents consist of cash and short-term deposits, as defined
above, net of ou tsta nd i ng ban k overd rafts as th^ are con sid ered an i nteg ra I pa rt of th e Co m pany¹ s ca sh man ag ement.

4.12 Statement of Cash flow

Cash flows are reported using the indirect method, whereby profit before tax is adjusted for the effects of transactions
of a non-cash nature, any deferrals or accruals of past orfuture operating cash receipts or payments and item of
income or expenses associated with investing or financing cash flows. The cash flows from operating, investing and
financing activities of the Company are segregated.

4.13 Earnings per share

Basic earnings per share are computed by dividing the profit/(loss) aftertax by the weighted average number of
equity shares outstanding during the year Diluted earnings per share is computed by dividing the profit/(loss) after
tax as adjusted for dividend, interest and other charges Lo expense or income (net of any attributable taxes) relating
to the d i I utiufi pote n tia I eq u ity sh a res, by t he wei g hted avera g p n um ber of equ ity sh a res cons idered fa r dfri vin g ba sic
earnings per share and the weighted average number of equity shares which could have been issued on conversion
of all dilutive potential equity shares, ff potential equity shares converted into equity shares increases the earnings
per share, then they are treated as anti dilutive and anti-dilutive earning per share is computed.

Basic and diluted earnings per share a re computed and presented in accordance with Ind AS 33 Earnings per Share