01 Corporate Information
Dr. Agarwal's Health Care Limited (the "Company") was
incorporated on 19th April 2010 and the Company is
primarily engaged in running, owning and managing
eye care hospitals, opticals, pharmacies, etc. and related
services. As at 31st March 2025, the Company is operating
in 152 locations in India.
02 Statement of Compliance and
Basis of Preparation
2.1 Statement of Compliance
The Standalone Financial Information have been
prepared in accordance with Indian Accounting
Standards notified under the Companies (Indian
Accounting Standards) Rules, 2015 and relevant
amendment rules issued thereafter.
The Standalone financial statements were
authorised for the issue by the Company's Board of
Directors on 28th May 2025.
2.2 Basis of Preparation and Presentation of
Financial Statements
The Standalone Financial Statements of the
Company comprises of the Standalone Balance
Sheet as at 31st March 2025 and 31st March 2024 the
Standalone Statement of Profit and Loss (including
Other Comprehensive Income), the Standalone
Statement of Cash Flows, the Standalone
Statement of Changes in Equity for the year
ended 31st March 2025 and 31st March 2024 and
the Material Accounting Policies and explanatory
notes (collectively, the 'Standalone Financial
Statements').
These financial statements have been prepared on
the historical cost basis, except for certain assets
and liabilities (refer accounting policy regarding
financial instruments and business combinations)
and share-based payments which have been
measured at fair value as per Ind AS 102.
Fair value is the price that would be received to sell
an asset or paid to transfer a liability in an orderly
transaction between market participants at the
measurement date, regardless of whether that
price is directly observable or estimated using
another valuation technique. In estimating the
fair value of an asset or a liability, the Company
takes into account the characteristics of the asset
or liability if market participants would take those
characteristics into account when pricing the asset
or liability at the measurement date.
I n addition, for financial reporting purposes, fair
value measurements are categorised into Level
1, 2, or 3 based on the degree to which the inputs
to the fair value measurements are observable
and the significance of the inputs to the fair value
measurement in its entirety, which are described
as follows:
• Level 1 inputs are quoted prices (unadjusted)
in active markets for identical assets or
liabilities that the entity can access at the
measurement date;
• Level 2 inputs are inputs, other than quoted
prices included within Level 1, that are
observable for the asset or liability, either
directly or indirectly; and
• Level 3 inputs are unobservable inputs for the
asset or liability.
2.3 Use of Estimates
The preparation of the financial statements
requires the Management to make estimates and
assumptions considered in the reported amounts
of assets and liabilities (including contingent
liabilities) as of the date of the financial statements
and the reported income and expenses during
the reporting period. Examples of such estimates
include provision for doubtful debts/advances,
provision for employee benefits, useful lives of
fixed assets, lease term, provision for contingencies
etc. Management believes that the estimates used
in the preparation of the financial statements are
prudent and reasonable. Future results may vary
from these estimates. Estimates and underlying
assumptions are reviewed on an ongoing basis.
Revisions to accounting estimates are recognised
prospectively in the year in which the estimate is
revised and/or in future years, as applicable.
2.4 Cash and Cash Equivalents (for the
purpose of Statement of Cash flows)
Cash comprises cash on hand, cheques and demand
drafts on hand, balances with banks in current
accounts / demand deposits. Cash equivalents are
short-term balances (with an original maturity of
three months or less from the date of acquisition),
highly liquid investments that are readily
convertible into known amounts of cash and which
are subject to insignificant risk of changes in value.
Bank balances other than the balance included in
cash and cash equivalents represents balance on
account of margin money deposit with banks and
balances in earmarked Escrow accounts.
2.5 Statement of Cash flows
Cash flows are reported using the indirect method,
whereby profit/(loss) before extraordinary items
and tax is adjusted for the effects of transactions
of non-cash nature and any deferrals or accruals
of past or future cash receipts or payments. The
cash flows from operating, investing and financing
activities of the Company are segregated based on
the available information.
2.6 Functional and Presentation Currency
I tems included in the financial statements of the
Company are measured using the currency of
the primary economic environment in which the
Company operates (i.e. the "functional currency").
The financial statements are presented in Indian
Rupees (H), the national currency of India, which
is the functional currency of the Company. All
the financial information have been presented in
Crores of Indian Rupees except for share data and as
otherwise stated.
2.7 Operating Cycle
Based on the nature of products / activities of
the Company and the normal time between
acquisition of assets and their realisation in cash
or cash equivalents, the Company has determined
its operating cycle as 12 months for the purpose of
classification of its assets and liabilities as current
and non-current.
Current versus 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:
I. Expected to be realised or intended to be sold
or consumed in normal operating cycle.
II. Held primarily for the purpose of trading.
III. Expected to be realised within twelve months
after the reporting period, or
IV. 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 treated as current when:
I. It is expected to be settled in normal
operating cycle.
II. It is held primarily for the purpose of trading
III. I t is due to be settled within twelve months
after the reporting period, or
IV. There is no unconditional right to defer the
settlement of the liability for at least twelve
months after the reporting period.
Deferred tax assets and liabilities are classified as
non-current assets and liabilities. Advance tax paid
is classified as non-current assets.
2.8 Business Combinations
Business combinations in which control is acquired
are accounted for using the acquisition method,
other than those between entities subject to
common control. The consideration transferred in
a business combination is measured at fair value,
which is calculated as the sum of the acquisition
date fair values of the assets transferred by the
Company, liabilities incurred by the Company to
the former owners of the acquiree and the equity
interests issued by the Company in exchange of
control of the acquiree. Acquisition related costs
are generally recognised in Statement of Profit
and Loss as incurred. Contingent consideration,
if any, is measured at its acquisition date fair
value. Subsequent changes to the fair values are
recognised in the Statement of Profit and Loss
unless such adjustments qualify as measurement
period adjustments in which such it is adjusted to
the cost of acquisition. The Company determines
whether a transaction is part of the consideration
exchanged for the business combination or whether
it is separate taking into account factors such as
the reasons for the transaction, who initiated the
transaction and the timing of the transaction. In
assessing such situations, the Company considers
whether the transaction is primarily for the benefit
of the Company post the business combination
rather than for the benefit of the acquiree before the
combination, in which case such transactions are
treated separate from the business combination.
Factors that the Company considers in making such
assessment include continuing employment where
it is substantive, duration, levels of other elements
of remuneration, incremental payments to other
shareholders, linkage of payment to valuation of
the business, formula for additional payments etc.,
as may be applicable to each business combination.
If the initial accounting for a business combination
is incomplete by the end of the reporting period
in which the combination occurs, the Company
reports provisional amounts for the items for which
the accounting is incomplete. Those provisional
amounts are adjusted during the measurement
period, or additional assets or liabilities are
recognised, to reflect new information obtained
about facts and circumstances that existed as of
the acquisition date that, if known, would have
affected the amounts recognised as of that date.
The measurement period is the period from the
date of acquisition to the date the Company
obtains complete information about facts and
circumstances that existed as of the acquisition
date. The measurement period is subject to
a maximum of one year subsequent to the
acquisition date.
At the acquisition date, the identifiable assets
acquired and the liabilities assumed are recognised
at their fair value, except that
» Deferred tax assets or liabilities related
to employee benefits arrangements are
recognised and measured in accordance with
Ind AS 12 Income taxes and Ind AS 19 Employee
benefits respectively.
» Liabilities or equity instruments related to
share-based payment arrangements of the
acquiree or share-based payment arrangements
of the company entered into to replace
share-based payment arrangements of the
acquiree are measured in accordance with Ind
AS 102 at the acquisition date (see below) and
» Assets (or disposal groups) that are classified as
held for sale in accordance with Ind AS 105 are
measured in accordance with that Standard.
» Favourable component of right-of-use
assets and lease liabilities are recognised and
measured in accordance with IND AS 116-Leases.
Intangible assets acquired in a business
combination and recognised separately from
goodwill are initially recognised at their fair value
at the acquisition date. Goodwill is measured as the
excess of the sum of the consideration transferred,
the amount of any non-controlling interests in the
acquiree (if any) over the net of the acquisition date
amounts of the identifiable assets acquired and the
liabilities assumed. Contracts acquired in a business
combination are assessed for whether favourable
or unfavourable relative to current market terms
and if such favourable or unfavourable terms exist,
the Company adjusts the effects of such terms in
the measurement of the related assets or liabilities.
When a business combination is achieved in stages,
the Company's previously held equity interest in
the acquiree is remeasured to its acquisition-date
fair value and the resulting gain or loss, if any, is
recognised in profit or loss. Amounts arising from
interests in the acquiree prior to the acquisition
date that have previously been recognised in other
comprehensive income are reclassified to profit or
loss where such treatment would be appropriate if
that interest were disposed of.
2.9 Property, Plant and Equipment
Property, plant and equipment are stated at cost
less accumulated depreciation and accumulated
impairment loss (if any). The cost of property, plant
and equipment comprises its purchase price net of
any trade discounts and rebates and includes taxes,
duties, freight, incidental expenses related to the
acquisition and installation of the assets concerned
and is net Goods and Service Tax (GST), wherever
the credit is availed. Borrowing costs paid during the
period of construction in respect of borrowed funds
pertaining to construction / acquisition of qualifying
property, plant and equipment is adjusted to the
carrying cost of the underlying property, plant
and equipment.
Any part or components of property, plant and
equipment which are separately identifiable and
expected to have a useful life which is different
from that of the main assets are capitalised
separately, based on the technical assessment of
the Management.
Advances paid towards the acquisition of property,
plant and equipment outstanding at each balance
sheet date are disclosed as "Capital Advances" under
Other Non Current Assets and cost of Property,
Plant and Equipment not ready to use before such
date are disclosed under "Capital Work-in-Progress".
Depreciation
Depreciable amount for assets is the cost of an
asset less its estimated residual value. The residual
value is 5% of the original cost.
Depreciation on property, plant and equipment has
been provided on the straight line method (change
in method of depreciation effective from 1st April
2022) as per the useful life prescribed in Schedule
II to the Companies Act, 2013 except in cases of
certain assets where the management's estimate
of the useful life based on technical assessment is
less than the life prescribed in Schedule II in which
case depreciation is provided on the useful life as
assessed by the management.
Depreciation is accelerated on property, plant and
equipment, based on their condition, usability etc.,
as per the technical estimates of the Management,
where necessary.
Improvements to leasehold premises is amortised
over the remaining primary lease period.
An item of property, plant and equipment is
derecognised upon disposal or when no future
economic benefits are expected to arise from
the continued use of the asset. Any gain or loss
arising on the disposal or retirement of an item of
property, plant and equipment is determined as
the difference between the sales proceeds and the
carrying amount of the asset and is recognised in
the Statement of Profit and Loss.
2.10 Goodwill
Goodwill is measured as the excess of the sum of
the consideration transferred, the amount of any
non-controlling interests in the acquiree, and the
fair value of the acquirer's previously held equity
interest in the Acquiree (if any) over the net of the
acquisition-date amounts of the identifiable assets
acquired and the liabilities assumed.
For the purpose of impairment testing, goodwill
acquired in a business combination is, from the
acquisition date, allocated to each of the Company's
cash-generating units that are expected to benefit
from the combination, irrespective of whether other
assets or liabilities of the acquiree are assigned to
those units. Cash generating unit to which goodwill
has been allocated is tested for impairment
annually, or more frequently when there is an
indication that the unit may be impaired. If the
recoverable amount of the cash generating unit is
less than its carrying amount, the impairment loss is
allocated first to reduce the carrying amount of any
goodwill allocated to the unit and then to the other
assets of the unit pro rata based on the carrying
amount of each asset in the unit. Any impairment
loss for goodwill is recognised in the Statement of
Profit and Loss. An impairment loss recognised for
goodwill is not reversed in subsequent periods.
Where goodwill has been allocated to a cash¬
generating unit and part of the operation within
that unit is disposed of, the goodwill associated with
the disposed operation is included in the carrying
amount of the operation when determining the
gain or loss on disposal. Goodwill disposed in these
circumstances is measured based on the relative
values of the disposed operation and the portion of
the cash-generating unit retained.
2.11 Intangible Assets
"Intangible assets with finite useful lives that
are acquired separately are carried at cost less
accumulated amortisation and accumulated
impairment losses (if any). The intangible assets
are amortised over their respective individual
estimated useful lives on a straight-line basis,
commencing from the date of asset available to
Company for its use. The useful life considered for
the intangible assets are as under:
(i) Computer Software- 5 years
(ii) Non-compete - Effective from 1st April 2023,
are amortised over the agreement term
unless a shorter useful life is warranted as per
the nature of the acquisition. Refer note 9 for
changes in estimated useful lives effective
1st April 2023.
(iii) Trademarks - 10 years
(iv) Customer Relationship - 5 years
(v) Research & Development - 3 years
The estimated useful life and amortisation method
are reviewed at the end of each reporting period,
with the effect of any changes in estimate being
accounted for on prospective basis. Intangible
assets with indefinite useful lives that are acquired
separately are carried at cost less accumulated
impairment losses.
An Intangible asset is derecognised on disposal or
when no future economic benefits are expected
from use or disposal. Gains or losses arising from
derecognition of an intangible asset, measured as
the difference between the net disposal proceeds
and the carrying amount of the asset is recognised
in profit or loss when the asset is derecognised.
2.12 Impairment of Tangible and
Intangible Assets
At the end of each reporting period, the Company
reviews the carrying amounts of its tangible and
intangible assets to determine whether there is
any indication that those assets have suffered an
impairment loss. If any such indication exists, the
recoverable amount of the asset is estimated in
order to determine the extent of the impairment
loss (if any). Where it is not possible to estimate
the recoverable amount of an individual asset,
the Company estimates the recoverable amount
of the cash-generating unit to which the asset
belongs. Where a reasonable and consistent basis
of allocation can be identified, corporate assets are
also allocated to individual cash-generating units, or
otherwise they are allocated to the smallest group
of cash-generating units for which a reasonable and
consistent allocation basis can be identified.
Intangible assets with indefinite useful lives
and intangible assets not yet available for use
are tested for impairment at least annually, and
whenever there is an indication that the asset may
be impaired.
Recoverable amount is the higher of fair value less
costs to sell and value in use. In assessing value in
use, the estimated future cash flows are discounted
to their present value using a pre-tax discount rate
that reflects current market assessments of the
time value of money and the risks specific to the
asset for which the estimates of future cash flows
have not been adjusted.
I f the recoverable amount of an asset (or cash¬
generating unit) is estimated to be less than its
carrying amount, the carrying amount of the
asset (or cash-generating unit) is reduced to
its recoverable amount. An impairment loss is
recognised immediately in the Statement of Profit
and Loss, unless the relevant asset is carried at a
revalued amount, in which case the impairment loss
is treated as a revaluation decrease.
When an impairment loss subsequently reverses,
the carrying amount of the asset (or a cash
generating unit) is increased to the revised estimate
of its recoverable amount, but so that the increased
carrying amount does not exceed the carrying
amount that would have been determined had no
impairment loss been recognised for the asset (or
cash generating unit) in prior years. A reversal of an
impairment loss is recognised immediately in profit
or loss.
The Company's policy for impairment of Goodwill is
given in Note 2.10 above.
2.13 Inventories
Inventory of Traded Goods comprising Opticals,
Contact Lens and Accessories, Pharmaceutical
Products, and Consumables are valued at lower
of cost ascertained using the First-in-First-out
method and net realisable value. Cost includes
cost of purchase, freight, taxes, duties and other
charges incurred for bringing the goods to the
present location and condition and are net of
GST credit, wherever credit has been availed.
Consumption of Surgical Lens including other
consumables mainly comprises of IOL(intraocular
lenses) and the respective cost is disclosed in
Statement of Profit & Loss under "Consumption of
Surgical Lens including other consumables".
Net realisable value represents the estimated
selling price for inventories less all estimated costs
of completion and costs necessary to make the sale.
Due allowance is estimated and made for unusable/
non-saleable/ expired items of inventory wherever
necessary, based on the past experience of the
Company and such allowances are adjusted against
the inventory carrying value.
2.14 Revenue Recognition
(i) Revenue from Operations
Revenue is measured at the transaction price
of the consideration received or receivable.
Revenue is recognised upon transfer of control
of promised products or services to customers
in an amount that reflects the consideration
we expect to receive in exchange for those
products or services. Sales and Service Income
exclude Goods and Service Tax (GST) and are net
of trade / volume discounts, where applicable.
Sale of products comprising Sale of Optical
Frames and Lens, Pharmaceutical Products,
Contact Lens and related accessories and food
items is recognised on delivery of items to
the customers and when control on goods is
passed on to the customers.
Sale of services comprising Income from
Consultation, Surgeries, Treatments and
Investigations performed are recognised when
performance obligation is satisfied at a point in
time, on rendering the related services.
Other Operating Income comprises medical
support services provided by the Company and
is recognised on rendering the related services.
(ii) Other Income
Interest income from a financial asset is
recognised when it is probable that the
economic benefits will flow to the Company
and the amount of income can be measured
reliably. Interest income is accrued on a time
basis, by reference to the principal outstanding
and at the effective interest rate applicable,
which is the rate that exactly discounts
estimated future cash receipts through
the expected life of the financial asset to
that asset's net carrying amount on initial
recognition. Dividend Income is accounted for
when right to receive it is established.
(iii) Cross Charges
The Company incur expenses such as salaries,
software development and depreciation on
common assets etc on behalf of the group
company and share the common resources
for the group functions. Such expenses, which
are incurred for the group, are identified, and
cross-charged to the subsidiary companies.
2.15 Foreign Currency Transactions
Initial Recognition:
On initial recognition, all foreign currency
transactions are recorded by applying to the
foreign currency amount the exchange rate
between the reporting currency and the foreign
currency at the date of the transaction.
Subsequent Recognition:
As at the reporting date, non-monetary items which
are carried in terms of historical cost denominated in
a foreign currency are reported using the exchange
rate at the date of the transaction.
Treatment of Exchange Differences:
All monetary assets and liabilities in foreign currency
are restated at the end of accounting period at the
closing exchange rate and exchange differences on
restatement of all monetary items are recognised
in the Statement of Profit and Loss.
2.16 Employee Benefits
Retirement benefit costs and termination benefits:
(i) Defined Benefit Plans:
Employee defined benefit plans
include gratuity.
Payments to defined contribution retirement
benefit plans are recognised as an expense
when employees have rendered service
entitling them to the contributions.
For defined benefit retirement benefit plans,
the cost of providing benefits is determined
using the projected unit credit method,
with actuarial valuations being carried out
at the end of each annual reporting period.
Remeasurement, comprising actuarial gains
and losses, the effect of the changes to the
asset ceiling (if applicable) and the return
on plan assets (excluding net interest), is
reflected immediately in the balance sheet
with a charge or credit recognised in other
comprehensive income in the period in which
they occur. Remeasurement recognised in
other comprehensive income is reflected
immediately in retained earnings and is not
reclassified to profit or loss. Past service cost is
recognised in the Statement of profit or loss in
the period of a plan amendment. Net interest
is calculated by applying the discount rate at
the beginning of the period to the net defined
benefit liability or asset.
Defined benefit costs are categorised
as follows:
» Service cost (including current service cost,
past service cost, as well as gains and losses
on curtailments and settlements);
» Net interest expense or income; and
» Remeasurement
The Company presents the first two
components of defined benefit costs in profit
or loss in the line item 'Employee benefits
expense'. Curtailment gains and losses are
accounted for as past service costs.
The retirement benefit obligation recognised
in the balance sheet represents the actual
deficit or surplus in the Company's defined
benefit plans. Any surplus resulting from this
calculation is limited to the present value of
any economic benefits available in the form of
refunds from the plans or reductions in future
contributions to the plans.
A liability for a termination benefit is
recognised at the earlier of when the entity can
no longer withdraw the offer of the termination
benefit and when the entity recognises any
related restructuring costs.
The Company makes contribution to a scheme
administered by the insurer to discharge
gratuity liabilities to the employees.
Short-term and other long-term
employee benefits
A liability is recognised for benefits accruing to
employees in respect of wages and salaries,
annual leave and sick leave in the period the
related service is rendered at the undiscounted
amount of the benefits expected to be paid in
exchange for that service.
Liabilities recognised in respect of short term
employee benefits are measured at the
undiscounted amount of the benefits expected
to be paid in exchange for the related service.
Liabilities recognised in respect of other long
term employee benefits are measured at the
present value of the estimated future cash
outflows expected to be made by the Company
in respect of services provided by employees
up to the reporting date.
(ii) Defined Contribution Plans
Employee defined contribution plans include
provident fund and Employee state insurance.
Provident Fund and Employee
State Insurance:
All employees of the Company receive benefits
from Provident Fund and Employee's State
Insurance, which are defined contribution
plans. Both, the employee and the Company
make monthly contributions to the plan,
each equalling to a specified percentage of
employee's applicable emoluments. The
Company has no further obligations under
the plan beyond its monthly contributions.
The Company contributes to the Employee
Provident Fund and Employee's State
Insurance scheme maintained by the Central
Government of India and the contribution
thereof is charged to the Statement of Profit
and Loss in the year in which the services are
rendered by the employees.
2.17 Borrowing Costs
Borrowing costs include interest, amortisation of
ancillary costs incurred and exchange differences
arising from foreign currency borrowings to the
extent they are regarded as an adjustment to
the interest cost. Costs in connection with the
borrowing of funds to the extent not directly
related to the acquisition of qualifying assets are
charged to the Statement of Profit and Loss over
the tenure of the loan. Borrowing costs, allocated
to and utilised for qualifying assets, pertaining
to the period from commencement of activities
relating to construction / development of the
qualifying asset up to the date of capitalisation
of such asset are added to the cost of the assets.
Capitalisation of borrowing costs is suspended
and charged to the Statement of Profit and Loss
during extended periods when active development
activity on the qualifying assets is interrupted.
Interest income earned on the temporary
investment of specific borrowings pending their
expenditure on qualifying assets is deducted from
the borrowing costs eligible for capitalisation.
All other borrowing costs are recognised in profit or
loss in the period in which they are incurred.
2.18 Government Grants, Subsidies and
Export Incentives
Government grants and subsidies are recognised
when there is reasonable assurance that the
Company will comply with the conditions attached
to them and the grants / subsidies will be received.
Government grants whose primary condition is
that the Company should purchase, construct or
otherwise acquire capital assets are presented by
deducting them from the carrying value of the
assets. The grant is recognised as income over
the life of a depreciable asset by way of a reduced
depreciation charge.
Export benefits, if any, are accounted for in the year
of exports based on eligibility and when there is no
uncertainty in receiving the same.
Government grants in the nature of promoters'
contribution like investment subsidy, where no
repayment is ordinarily expected in respect thereof,
are accounted in Reserves and Surplus in Other
Equity. Government grants in the form of non¬
monetary assets, given at a concessional rate, are
recorded on the basis of their acquisition cost. In
case the non-monetary asset is given free of cost,
the grant is recorded at a nominal value.
Other government grants and subsidies are
recognised as income over the periods necessary
to match them with the costs for which they are
intended to compensate, on a systematic basis.
2.19 Segment Reporting
Operating segments reflect the Company's
management structure and the way the financial
information is regularly reviewed by the Company's
Chief operating decision maker (CODM). The CODM
considers the business from both business and
product perspective based on the dominant
source, nature of risks and returns and the internal
organisation and management structure. The
operating segments are the segments for which
separate financial information is available and
for which operating profit / (loss) amounts are
evaluated regularly by the executive Management
in deciding how to allocate resources and in
assessing performance.
The accounting policies adopted for segment
reporting are in line with the accounting policies
of the Company. Segment revenue, segment
expenses, segment assets and segment liabilities
have been identified to segments on the basis
of their relationship to the operating activities of
the segment.
Inter-segment revenue, where applicable, is
accounted on the basis of transactions which
are primarily determined based on market / fair
value factors.
Revenue, expenses, assets and liabilities which
relate to the Company as a whole and are not
allocable to segments on reasonable basis are
included under "unallocated revenue / expenses /
assets / liabilities".
2.20 Leases
The Company's lease asset classes consists of
leases for buildings . The Company, at the inception
of a contract, assesses whether the contract is a
lease or not lease. A contract is, or contains, a lease
if the contract conveys the right to control the use
of an identified asset for a time in exchange for
a consideration.
The Company recognises a right-of-use asset and
a lease liability at the lease commencement date.
The right-of-use asset is initially measured at cost,
which comprises the initial amount of the lease
liability adjusted for any lease payments made at
or before the commencement date, plus any initial
direct costs incurred and an estimate of costs to
dismantle and remove the underlying asset or to
restore the underlying asset or the site on which it
is located, less any lease incentives received.
The right-of-use asset is subsequently depreciated
using the straight-line method from the
commencement date to the end of the lease term.
The lease liability is initially measured at the
present value of the lease payments that are not
paid at the commencement date, discounted using
the Company's incremental borrowing rate. It is
remeasured when there is a change in future lease
payments arising from a change in an index or rate,
if there is a change in the Company's estimate of
the amount expected to be payable under a residual
value guarantee, or if the Company changes its
assessment of whether it will exercise a purchase,
extension or termination option. When the lease
liability is remeasured in this way, a corresponding
adjustment is made to the carrying amount of the
right-of-use asset, or is recorded in profit or loss if
the carrying amount of the right-of-use asset has
been reduced to zero.
The Company has elected not to recognise right-
of-use assets and lease liabilities for short-term
leases that have a lease term of 12 months or less
and leases of low-value assets. The Company
recognises the lease payments associated with
these leases as an expense over the lease term.
2.21 Earnings Per Share
Basic earnings per share is computed using the
weighted average number of equity shares
outstanding during the period.
Diluted EPS is computed by dividing the net profit
after tax by the weighted average number of equity
shares considered for deriving basic EPS and also
weighted average number of equity shares that
could have been issued upon conversion of all
dilutive potential equity shares.
Potential equity shares are deemed to be dilutive
only if their conversion to equity shares would
decrease earnings per share from continuing
operations. Dilutive potential equity shares are
deemed converted as of the beginning of the
period, unless issued at a later date. The dilutive
potential equity shares are adjusted for the
proceeds receivable had the shares been actually
issued at fair value (i.e. average market value of
the outstanding shares). Dilutive potential equity
shares are determined independently for each
period presented. The number of equity shares and
potentially dilutive equity shares are adjusted for
share splits / reverse share splits and bonus shares,
as appropriate.
2.22 Taxes on Income
Income tax expense represents the sum of the tax
currently payable and deferred tax.
Current tax expense for the year is ascertained
on the basis of assessable profits computed in
accordance with the provisions of the Income-tax
Act, 1961.
Deferred tax is recognised on temporary differences
between the carrying amounts of assets and
liabilities in the Financial Statements and the
corresponding tax bases used in the computation of
taxable profit. Deferred tax liabilities are generally
recognised for all taxable temporary differences.
Deferred tax assets are generally recognised for
all deductible temporary differences to the extent
that it is probable that taxable profits will be
available against which those deductible temporary
differences can be utilised. Such deferred tax assets
and liabilities are not recognised if the temporary
difference arises from the initial recognition (other
than in a business combination) of assets and
liabilities in a transaction that affects neither the
taxable profit nor the accounting profit.
Deferred tax is also recognised for all the taxable
temporary differences on account of undistributed
profits in subsidiaries, unless the timing of reversal
of the temporary differences can be controlled and
it is probable that the temporary differences will
not be reversed in the foreseeable future.
The carrying amount of deferred tax assets is
reviewed at the end of each reporting period and
reduced to the extent that it is no longer probable
that sufficient taxable profits will be available to
allow all or part of the asset to be recovered.
Deferred tax liabilities and assets are measured
at the tax rates that are expected to apply in the
period in which the liability is settled or the asset
realised, based on tax rates (and tax laws) that have
been enacted or substantively enacted by the end
of the reporting period.
The measurement of deferred tax liabilities and
assets reflects the tax consequences that would
follow from the manner in which the Company
expects, at the end of the reporting period, to
recover or settle the carrying amount of its assets
and liabilities.
|