2 Summary of Significant Accounting Policies

a) Basis of Preparation of Financial Statements

The financial statements of the Company have
been prepared in accordance with generally
accepted accounting principles of India (Indian
GAAP). The Company has prepared these financial
statements to comply in all material respects with
the accounting standards notified under section
133 of the Companies Act, 2013, read together
with Rule 7 of the Companies (Accounts) Rules,
2014 and the relevant provisions of the Companies
Act, 2013 ('the Act'). The financial statements have
been prepared on an accrual basis and under the
historical cost convention.

The accounting policies adopted in the preparation
of financial statements are consistent with those of
previous year unless otherwise disclosed.

b) Use of Estimates

The preparation of financial statements in
conformity with Indian GAAP requires management
to make estimates and assumptions that affect the
application of accounting policies and reported
amounts of assets, liabilities, revenues and
expenses and disclosure of contingent assets and

liabilities at the date of the financial statements.
The estimates and assumptions used in the
accompanying financial statements are based
upon management's evaluation of the relevant
facts and circumstances as of the date of financial
statements which in management's opinion are
prudent and reasonable. Actual results may
differ from the estimates used in preparing the
accompanying financial statements. However,
accounting estimates could change from period to
period. Appropriate changes in estimates are made
as the Management becomes aware of changes
in circumstances surrounding the estimates. Any
revision to accounting estimates is recognised
prospectively in current and future periods and, if
material, their effects are disclosed in the notes to
the Standalone financial statements.

c) Functional and Presentation Currency

These financial statements are presented in Indian
Rupees ('), the company's functional currency. All
Financial information presented in Indian Rupee
has been rounded off to the nearest lakh as per
the requirements of Schedule III of "the Act" unless
otherwise stated.

d) Current and Non-Current Classification

All assets and liabilities are classified into current
and non-current.

Assets

An asset is classified as current when it satisfies any
of the following criteria:

i) It is expected to be realized in, or is intended
for sale or consumption in, the Company's
normal operating cycle;

ii) It is held primarily for the purpose of being
traded;

iii) It is expected to be realized within 12 months
after the reporting date; or

iv) It is cash or cash equivalent unless it is
restricted from being exchanged or used to
settle a liability for at least 12 months after the
reporting date.

Current assets include the current portion of
non-current financial assets. All other assets
are classified as non-current.

Liabilities

A liability is classified as current when it satisfies
any of the following criteria:

i) It is expected to be settled in the Company's
normal operating cycle;

ii) It is held primarily for the purpose of being
traded;

iii) It is due to be settled within 12 months after
the reporting date; or

iv) The Company does not have an unconditional
right to defer settlement of the liability for at
least 12 months after the reporting date.

Current liabilities include the current portion
of non-current financial liabilities. All other
liabilities are classified as non-current.

e) Operating Cycle

Operating cycle is the time between the acquisition
of assets for processing and their realisation in
cash and cash equivalents. Based on the above
definition and nature of business, the company
has ascertained its operating cycle as less than 12
months for the purpose of current/ non current
classification of assets and liabilities.

f) Property, Plant and Equipment, Intangible
Assets & CWIP

Property, Plant and Equipment

Property, Plant and Equipment are stated at cost
less accumulated depreciation. The total cost of
assets comprises its purchase price, freight, duties,
taxes and any other incidental expenses directly
attributable to bringing the asset to the working
condition for its intended use and interest on loans
attributable to the acquisition of assets up to the
date of commissioning of assets.

Subsequent costs related to an item of property,
plant and equipment are 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 recognized in statement of
profit and loss during the reporting period when
they are incurred.

An item of property, plant and equipment is de¬
recognized on disposal or when no future economic
benefits are expected from its use or disposal.
The gains or losses arising from de-recognition
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.

Intangible Assets

Intangible assets are recognized if it is probable that

the future economic benefits that are attributable
to the assets will flow to the Company and cost
of the assets can be measured reliably. The cost
of intangible assets comprises its purchase price,
including any duties and other taxes and any
directly attributable expenditure on making the
asset ready for its intended use.

An item of an intangible asset is de-recognized on
disposal or when no future economic benefits are
expected from its use or disposal. The gains or
losses arising from de-recognition 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.

Subsequent costs related to intangible assets are
recognised as a separate asset, as appropriate, only
when it is probable that future economic benefits
associated with the item will flow to the Group and
the cost of the item can be measured reliably.

Capital Work In Progress

Capital work in progress are carried at cost,
comprising direct cost, related incidental expenses
during the construction period, attributable
borrowing costs for the qualifying assets and other
expenses incurred in connection with project
implementation in so far as such expenses relate
to the period prior to the commencement of
commercial production. Advances given towards
the construction of the capital asset outstanding
at each balance sheet date are disclosed as capital
advances under long term loans and advances.

g) Depreciation and Amortisation

Depreciation on Property, Plant and Equipment is
provided on written down value method for the
PPE purchased before the 01.04.2023, at the rates
arrived at on the basis of the estimated economic
useful life of the assets. The useful life for building,
plant & machinery & leasehold improvements
is considered as prescribed in Schedule II of
the Companies Act, 2013, representing the
management's estimate of the useful life of these
assets and following consistency with previous
year.

Depreciation on Property, Plant and Equipment
is provided on straight line method for the PPE
purchased on or after 01.04.2023, at the rates
arrived at on the basis of the estimated economic
useful life of the assets. The useful life for building,
plant & machinery & leasehold improvements
is considered as prescribed in Schedule II of
the Companies Act, 2013, representing the

The company has estimated residual value of the
assets to be 5% of the cost of the asset.

*The Schedule II has not defined useful life of
the intangible asset, however it suggests to refer
accounting standard for life of the intangible asset.
As per the Accounting Standard 26 Intangible Asset
, the useful life of the intangible asset shall not
exceed 10 years.

h) Revenue Recognition

Revenue is recognized to the extent that it is
probable that the economic benefits will flow
to the Company and the revenue can be reliably
measured.

Sale of goods

Revenue from sale of goods is recognized on
transfer of all significant risks and rewards related
to the ownership of such goods to the buyer. Sales
are stated net of trade discount, sales return,
duties and GST. Revenue is recognized only when
it can be reliably measured and it is reasonable to
expect ultimate collection.

Sale of service

Revenue from services provided is recognized
based on contractual terms and rateably over the
period in which services are rendered. Revenue
from the end of the last billing to the Balance Sheet
date is recognized as unbilled revenues. Revenue
from fixed-price and fixed-timeframe contracts,
where there is no uncertainty as to measurement or
collectability of consideration, is recognized based
upon the percentage-of-completion method.

Interest income

Interest income is recognized on time proportion
basis on interest rates implicit in the transaction.

Dividend Income

Dividend income is recognised on receipt basis.
Other Income

Other income is recognized based on the
contractual obligations on accrual basis.

Lease rentals are recognised on a straight line
basis over the period of lease.

Other Operating Revenue

Export incentives, production linked incentives and
subsidies are recognized when there is reasonable
assurance that the Company is complying with the
conditions and the incentive will be received.

i) Inventories

Inventories are valued at cost or net realisable

value, whichever is lower. Cost comprises of all
costs of purchase, costs of conversion and other
costs incurred in bringing the inventories to their
present location and condition and is determined
on weighted average method. Net Realizable Value
is the estimated selling price in the ordinary course
of business less estimated cost of completion and
the estimated cost necessary to make the sale.

Raw materials, components, stores and spares are
valued at lower of cost and net realizable value.
However, materials and other items held for use
in production of inventories are not written down
below cost if the finished products in which they
will be incorporated are expected to be sold at or
above cost. Cost of raw materials, components
and stores and spares is determined on weighted
average basis.

Work in progress and finished goods are valued at
lower of cost and net realizable value. Cost includes
direct material and labour and a proportion
of manufacturing overheads based on normal
operating capacity. Cost is determined on weighted
average basis.

j) Foreign Currency Transactions
Initial recognition

Foreign currency transactions are recorded in
the reporting currency which is Indian Rupee,
by applying to the foreign currency amount the
exchange rate between the reporting currency
and the foreign currency at the date of the
transaction.

Conversion

Monetary assets and liabilities in foreign currency,
which are outstanding as at the year-end, are
revalued at the year-end at the closing exchange
rate and the resultant exchange differences are
recognized in the Statement of Profit and Loss at
the year end.

Exchange Differences

All exchange differences are recognized as income
or as expenses in the period in which they arise.

k) Retirement and other employee benefits

The Company's obligation towards various
employee benefits has been recognised as follows:

Short term employee benefit

All employee benefits payable wholly within twelve
months of rendering the service are classified
as short-term employee benefits. Short term
employee benefit obligations are expensed when

the related services are provided. Liabilities for
wages and salaries, including non-monetary
benefits that are expected to be settled wholly
within twelve months after the end of the period
in which the employees render the related service
are recognized in respect of employees' services
up to the end of the reporting period.

Defined contribution plans

The company's contributions to the Provident Fund
and Employee State Insurance are charged to the
Statement of Profit and Loss of the year when the
contributions to the respective funds are due. Both
the employee and the employer make monthly
contributions to the plan at a predetermined rate
of the employee's basic salary. These contributions
are made to the fund administered and managed
by the government of India.

Post Employment Benefits

Defined benefits plans

The company operates two defined benefit plans
for its employees: gratuity and leave encashment.
The cost of providing benefits under these plans
is determined on the basis of actuarial valuation,
carried out by an independent actuary, at each
year-end. A separate actuarial valuation is carried
out for each plan using the projected unit credit
method which recognizes each period of service as
giving rise to an additional unit of employee benefit
entitlement and measures each unit separately to
build up the final obligation. Actuarial losses and
gain for both defined benefit plans are recognised
in full in the period in which they occur in the
statement of profit and loss.

The Company's gratuity benefit scheme is a defined
benefit plan. The Company's net obligation in
respect of the gratuity benefit scheme is calculated
by estimating the amount of future benefit that
employees have earned in return for their service
in the current and prior periods; that benefit is
discounted to determine its present value, and
the fair value of any plan assets is deducted. The
Company provides for the Gratuity Plan based on
projection valuations in accordance with Accounting
Standard 15 (Revised), "Employee Benefits".

The employees of the Company are entitled
to compensated absences which are both
accumulating and non-accumulating in nature.
The expected cost of accumulating compensated
absences is determined on the additional amount
expected to be paid / availed as a result of the
unused entitlement that has accumulated at the
Balance Sheet date. Expense on non-accumulating

compensated absences is recognized in the period
in which the absences occur.

The obligation is measured at the present value
of the estimated future cash flows. The discount
rates used for determining the present value of the
obligation under defined benefit plan are based on
the market yields on Government Securities as at
the Balance Sheet date.

Actuarial gains and losses comprise experience
adjustments and the effects of changes in actuarial
assumptions and are recognized immediately in
the Statement of Profit and Loss.

l) Leases

Operating lease: Leases where the lessor
effectively retains substantially all the risks and
benefits of ownership of the leased item, are
classified as operating lease. Payments made
under cancellable operating leases are charged to
the Profit & loss Account on a straight line basis
over the period of lease.

Finance lease: Principal amount of the finance lease
is capitalized and depreciated accordingly. Finance
charges are charged to Profit & Loss Account
over the period of the lease. Finance lease, which
effectively transfers to the company substantially
all the risks and benefits incidental to ownership
of the leased item, are capitalised at the lower of
fair value and present value of the minimum lease
payments at the inception of the lease term and
disclosed as leased assets. Finance charges are
recognised as finance cost in statement of profit
and loss account.

m) Taxation

Income-tax expense comprises current tax and
deferred tax.

Current tax

Provision for current tax is made for the tax liability
payable on taxable income after considering
tax allowances, deductions and exemptions
determined in accordance with the prevailing tax
laws. The tax currently payable is based on taxable
profit for the year. Taxable profit differs from 'profit
before tax' as reported in the statement of profit
and loss because of items of income or expense
that are taxable or deductible in other years and
items that are never taxable or deductible.

The company's current tax is calculated using the
tax rates as prescribed in the section 115BAA of
the Income Tax Act, 1961.

Deferred tax

Deferred tax liability or asset is recognized for
timing differences between the profits/losses
offered for income tax and profits/losses as per
the financial statements. Deferred tax assets and
liabilities are measured using the tax rates and
tax laws that have been enacted or substantively
enacted at the Balance Sheet date.

Deferred tax asset is recognized only to the extent
there is reasonable certainty that the assets
can be realized in future. However, where there
is unabsorbed depreciation or carried forward
loss under taxation laws, deferred tax asset on
such losses is recognized only if there is a virtual
certainty of their realization. Deferred tax assets
and liabilities are reviewed at each Balance Sheet
date and written down or written up to reflect the
amount that is reasonably/virtually certain to be
realized.

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 tax assets and deferred tax relates
to the same taxable entity and the same taxation
authority.

n) Borrowing Cost

Borrowing costs to the extent related/attributable
to the acquisition/construction of assets that
takes substantial period of time to get ready for
their intended use are capitalized along with the
respective Property, Plant and Equipment up to the
date such asset is ready for use. Other borrowing
costs are recognised as expense in the Statement
of Profit and Loss in the period in which they are
incurred.

o) Earning Per Share
Basic EPS

In determining earnings per share, the Company
considers the net profit / (loss) after tax and
includes the effect of extraordinary items in the
profit and loss account. The number of shares
used in computing basic earnings per share is the
weighted average number of shares outstanding
during the period. The weighted average number
of equity shares outstanding during the period is
adjusted for events such as bonus issue and issue
of fresh equity shares under IPO that have changed
the number of equity shares outstanding at the
year end.

Diluted EPS

For the purpose of calculating diluted earnings
per share, the net profit or loss for the period
attributable to equity shareholders and the
weighted average number of shares outstanding
during the period are adjusted for the effects of all
dilutive potential equity shares.

p) Investment

Investments that are readily realizable and intended
to be held for not more than a year are classified
as current investments. All other investments
are classified as long-term investments. Current
investments are carried at lower of cost and fair
value determined on an individual investment
basis. Long-term investments are carried at cost.
However, provision for diminution in value is made
to recognize a decline other than temporary in the
value of the investments.