(B) Material accounting policies
a) Statement of compliance
These Standalone financial statements of the Company
have been prepared in accordance with Indian
Accounting Standards (Ind AS) as per the Companies
(Indian Accounting Standards) Rules 2015 as amended
and notified under Section 133 of the Companies Act,
2013 (the “Act”) and other relevant provisions of the Act.
The financial statements of the Company for the year
ended 31st March, 2026 were approved for issue in
accordance with a resolution of the Board of Directors in
its meeting held on 14th May, 2026.
b) Basis of preparation and presentation
The financial statements are prepared in accordance
with the historical cost basis, except for certain financial
instruments that are measured at fair values, as explained
in the accounting policies below.
Historical cost is generally based on the fair value of the
consideration given in exchange for goods and services.
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. Fair value
for measurement and/or disclosure purposes in these
financial statements is determined on such a basis,
except for leasing transactions that are within the scope
of Ind AS 116- Leases, and measurements that have
some similarities to fair value but are not fair value, such
as net realisable value in Ind AS 2 - Inventories or value
in use in Ind AS 36 - Impairment of Assets.
Current/Non-Current Classification
All Assets and Liabilities have been classified as current
or non-current as per the Company's normal operating
cycle.
An asset is treated as current when any of the below
conditions are satisfied:
• Expected to be realised or intended to be sold or
consumed in normal operating cycle;
• Held primarily for the purpose of trading;
• Expected to be realised within twelve months after
the reporting period; or
• Cash or cash equivalent unless restricted from
being exchanged or used to settle a liability for at
least twelve months after the reporting period.
All other assets are classified as non-current.
A liability is treated as current when any of the below
conditions are satisfied:
• It is expected to be settled in normal operating
cycle;
• It is held primarily for the purpose of trading;
• It is due to be settled within twelve months after the
reporting period; or
• There is no unconditional right to defer the
settlement of the liability for at least twelve months
after the reporting period.
All other liabilities are classified as non-current.
Based on the nature of products and the time between
acquisition of assets for processing and their realisation
in cash and cash equivalents, the Company has
ascertained its operating cycle as 12 months for the
purpose of current or non-current classification of assets
and liabilities. Deferred tax assets and liabilities are
classified as non-current assets and liabilities. All the
current assets and current liabilities are expected to be
realised/settled within the period of 12 months from the
reporting date.
The principal accounting policies are set out below
c) Revenue Recognition
(i) Revenue from sale of products
Revenue from contract with customers is recognised
when the Company satisfies performance
obligation by transferring promised goods to the
customer. Performance obligations are satisfied at
the point of time when the customer obtains control
of the asset.
Revenue is measured based on transaction price,
stated net of discounts, returns & goods and
service tax. Transaction price is recognised based
on the price specified in the contract, net of the
estimated sales incentives/ discounts. Accumulated
experience is used to estimate and provide for the
discounts/ right of return, using the expected value
method.
(ii) Revenue from project
For performance obligation satisfied over time, the
revenue recognition from projects is done using
input method by measuring the progress towards
complete satisfaction of performance obligation.
The progress is measured in terms of a proportion
of actual cost incurred to-date, to the total estimated
cost attributable to the performance obligation as it
best depicts the transfer of control that occurs as
costs are incurred.
The Company transfers control of a good or service
over time and therefore satisfies a performance
obligation and recognises revenue over a period of
time if one of the following criteria is met:
(a) the customer simultaneously consumes the
benefit of the Company's performance or
(b) the customer controls the asset as it is
being created/ enhanced by the Company's
performance or
(c) there is no alternative use of the asset and the
Company has either explicit or implicit right of
payment considering legal precedents.
In all other cases, performance obligation is
considered as satisfied at a point in time. The
revenue is recognised to the extent of transaction
price allocated to the performance obligation
satisfied. Transaction price is the amount of
consideration to which the Company expects to
be entitled in exchange for transferring goods or
services to a customer excluding amounts collected
on behalf of a third party.
Costs to obtain a contract which are incurred
regardless of whether the contract was obtained
are charged off in profit or loss immediately in the
period in which such costs are incurred. Incremental
costs of obtaining a contract, if any, and costs
incurred to fulfil a contract are amortised over the
period of execution of the contract in proportion to
the progress measured in terms of a proportion of
actual cost incurred to-date, to the total estimated
cost attributable to the performance obligation.
Significant judgments are used in:
a. Determining the revenue to be recognised in
case of performance obligation satisfied over
a period of time; revenue recognition is done
by measuring the progress towards complete
satisfaction of performance obligation.
b. Determining the expected losses, which are
recognised in the period in which such losses
become probable based on the expected
total contract cost as at the reporting date.
Contract revenue is recognised over time to the
extent of performance obligation satisfied and
control is transferred to the customer. Contract
revenue is recognised at allocable transaction
price which represents the cost of work performed
on the contract plus proportionate margin, using
the percentage of completion method. Percentage
of completion is the proportion of cost of work
performed to-date, to the total estimated contract
costs. With respect to contracts, where the
outcome of the performance obligation cannot
be reasonably measured, but the costs incurred
towards satisfaction of performance obligation
are expected to be recovered, the revenue is
recognised only to the extent of costs incurred.
For contracts where the aggregate of contract cost
incurred to date plus recognised profits (or minus
recognised losses as the case may be) exceeds
the progress billing, the surplus is shown as
contract asset and termed as “Unbilled revenue”.
For contracts where progress billing exceeds the
aggregate of contract costs incurred to-date plus
recognised profits (or minus recognised losses, as
the case may be), the surplus is shown as contract
liability and termed as “Excess of billing over
revenue”. Amounts received before the related
work is performed are disclosed in the Balance
Sheet as contract liability and termed as “Advances
from customer”. The amounts billed on customer
for work performed and are unconditionally due
for payment i.e. only passage of time is required
before payment falls due, are disclosed in the
Balance Sheet as trade receivables. The amount
of retention money held by the customers pending
completion of performance milestone is disclosed
as part of contract asset and is reclassified as trade
receivables when it becomes due for payment.
The Company recognises impairment loss (termed
as provision for expected credit loss in the financial
statements) on account of credit risk in respect of a
contract asset using expected credit loss model on
similar basis as applicable to trade receivables.
(iii) Other Income
Dividend income from investments is
recognised when the shareholder's right
to receive dividend has been established.
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.
d) Property, Plant and Equipment and Capital Work in
Progress
Property, Plant and Equipment are stated at cost of
acquisition or construction less accumulated depreciation
and impairment losses, if any. The cost of Property, Plant
and Equipment comprises its purchase price net of any
trade discounts and rebates, any import duties and other
taxes (other than those subsequently recoverable from
the tax authorities), any directly attributable expenditure
on making the asset ready for its intended use, other
incidental expenses, decommissioning costs, if any and
interest on borrowings attributable to acquisition of
qualifying asset up to the date the asset is ready for its
intended use. Subsequent expenditure on fixed assets
after its purchase / completion is capitalised only if such
expenditure results in an increase in the future benefits
from such asset beyond its previously assessed standard
of performance and cost can be measured reliably.
Machinery spares that meet the definition of property,
plant and equipment are capitalised.
Property, Plant and Equipment which are not ready for
intended use as on date of Balance Sheet are disclosed
as “Capital work-in-progress”. Projects are carried at
cost comprising of direct cost and related incidental
expenses and attributable borrowing costs, if any.
Advances given towards acquisition or construction
of property, plant and equipment outstanding at each
reporting date are disclosed as Capital Advances under
“Other non-current assets”.
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 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.
Depreciation on these assets commences when assets
are ready for their intended use which is generally on
commissioning. Items of Property, Plant and Equipment
are depreciated in a manner that amortises the cost of
the assets after commissioning less its residual value,
over their useful lives as specified in Schedule II of the
Act on a straight line basis.
Depreciation on additions/deletions during the year is
provided on pro-rata basis from/up to the date of such
addition/deletion.
Property, Plant and Equipment's residual values and
useful lives are reviewed at each Balance Sheet date and
changes, if any, are treated as changes in accounting
estimate.
e) Intangible Assets
Intangible assets with finite useful lives that are
acquired separately are carried at cost less accumulated
amortisation and accumulated impairment losses.
Amortisation is recognised on a straight-line basis over
their estimated useful lives so as to reflect the pattern
in which the asset's economic benefits are consumed.
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
a prospective basis. The amortisation of intangible asset
is included in Depreciation and Amortisation expense in
the Statement of Profit and Loss.
Software
The expenditure incurred is amortised over the five
years equally commencing from the date of acquisition.
Technical Know-how
The expenditure incurred on Technical Know-how is
amortised over the estimated period of benefit, not
exceeding ten years commencing from the date of
acquisition.
Research & Development
Revenue expenditure pertaining to research is charged
to the Statement of Profit and Loss. Development costs
of products are also charged to the Statement of Profit
and Loss unless a product's technical and economic
feasibility and marketability has been established, in
which case such expenditure is capitalised. The amount
capitalised comprises expenditure that can be directly
attributed or allocated on a reasonable and consistent
basis to creating, producing and making the asset ready
for its intended use. Property, Plant and Equipment
utilised for research and development are capitalised
and depreciated in accordance with the policies stated
for Property, Plant and Equipment.
f) Inventories
Inventories comprise all costs of purchase, conversion
and other costs incurred in bringing the inventories to
their present location and condition.
Raw materials and bought out components are valued
at the lower of cost or net realisable value. Cost is
determined on the basis of the weighted average
method.
Finished goods produced and purchased for sale,
manufactured components and work-in-progress are
carried at cost or net realisable value whichever is lower.
Stores, spares and tools other than obsolete and slow
moving items are carried at cost. Obsolete and slow-
moving items are valued at cost or estimated net
realisable value, whichever is lower.
g) Equity Investments in Subsidiaries
Equity Investments in Subsidiaries are carried individually
at cost less accumulated impairment, if any.
h) Leases
The Company as a lessee
The Company's lease asset classes primarily comprise
of lease for land and building. The Company assesses
whether contract contains a lease, at inception of a
contract. A contract is, or contains, a lease if the contract
conveys right to control the use of an identified asset for
a period of time in exchange for consideration. To assess
whether a contract conveys the right to control the use
of an identified asset, the Company assesses whether: (i)
the contract involves the use of an identified asset (ii) the
Company has substantially all of the economic benefits
from use of the asset through the period of the lease and
(iii) the Company has the right to direct the use of the
asset.
At the date of commencement of the lease, the
Company recognizes a Right of use (ROU) Asset and a
corresponding lease liability for all lease arrangements
in which it is a lessee, except for leases with a term of
twelve months or less (short-term leases) and low value
leases. For these short-term and low value leases,
the Company recognizes the lease payments as an
operating expense over the term of the lease.
Right of use Asset are initially recognised at cost,
which comprises the initial amount of the lease liability
adjusted for any lease payments made at or prior to the
commencement date of the lease plus any initial direct
costs less any lease incentives. They are subsequently
measured at cost less accumulated depreciation and
impairment losses. Right of use Asset are depreciated
from the commencement date on a straight-line basis
over the shorter of the lease term and useful life of the
underlying asset. The lease liability is initially measured
at amortized cost at the present value of the future lease
payments. The lease payments are discounted using
the interest rate implicit in the lease or, if not readily
determinable, using the incremental borrowing rates in
the country of domicile of these leases.
Lease liability and Right of use asset have been
separately presented in the Balance Sheet and lease
payments have been classified as financing cash flows.
i) Foreign exchange transactions and translations
Transactions in foreign currencies i.e. other than the
Company's functional currency of Indian Rupees are
recognised at the rates of exchange prevailing at the
dates of the transactions. At the end of each reporting
period, monetary items denominated in foreign
currencies are retranslated at the rates prevailing at
that date. Non-monetary items carried at fair value that
are denominated in foreign currencies are retranslated
at the rates prevailing at the date when the fair value
was determined. Non-monetary items that are measured
in terms of historical cost in a foreign currency are not
retranslated. Exchange differences on revaluation are
recognised in the Statement of Profit and Loss in the
period in which they arise.
j) Employee Benefits
Employee benefits include provident fund, employee
state insurance scheme, gratuity and compensated
absences.
Defined contribution plans
The Company's contribution to provident fund and
employee state insurance scheme are considered
as defined contribution plans and are charged as an
expense based on the amount of contribution required
to be made.
Defined benefit plans
For defined benefit plans in the form of gratuity, the
cost of providing benefits is determined using the
Projected Unit Credit method, with actuarial valuations
being carried out at each balance sheet date. Service
cost and net interest expenses or income is recognised
in the Statement of Profit and Loss. Remeasurement,
comprising actuarial gains and losses 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.
Short 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.
Long term Compensated absences
The employees of the Company are entitled to
compensated absences for which the Company records
the liability based on actuarial valuation computed
using projected unit credit method. These benefits are
unfunded.
Performance Stock Option Plan (PSOP):
The Company measures Performance Stock Option
Plan (PSOP) Expense relating to share-based payments
using the fair valuation method in accordance with
Ind AS 102, Share Based Payment. PSOP Expense is
amortized over the vesting period of the option with a
corresponding increase in equity (Performance Stock
Option Plan Reserve). The fair value determined at the
grant date is expensed over the vesting period of the
respective tranches of such grants. The cost of equity-
settled transactions is determined by the fair value at the
date when the grant is made using the Black-Scholes
valuation model. Expected volatility during the expected
term of the option is based on the historical volatility of
share price of the Company. Risk free interest rates are
based on the government securities yield in effect at the
time of the grant. The cost of equity settled transactions
is recognised, together with a corresponding increase in
share-based payment reserve in equity, over the period
in which the performance and/or service conditions
are fulfilled. The cumulative expense recognised for
equity-settled transactions at each reporting date until
the vesting date reflects the extent to which the vesting
period has expired and the Company's best estimate
of the number of equity instruments that will ultimately
vest. Debit or credit in statement of profit and loss for a
period represents the movement in cumulative expense
recognized as at the beginning and end of that period
and is recognized in employee benefits expense.
Service and non-market performance conditions are
not taken into account when determining the grant date
fair value of awards, but the likelihood of the conditions
being met is assessed as part of the Company's best
estimate of the number of Equity instruments that
will ultimately vest. The dilutive effect of outstanding
options is reflected as additional share dilution in the
computation of diluted Earnings per share.
No expense is recognised for awards that do not
ultimately vest because non-market performance and/or
service conditions have not been met.
k) Borrowing Costs
Borrowing costs consist of interest and other costs
incurred in connection with the borrowing of funds.
Borrowing costs also include exchange differences to
the extent regarded as an adjustment to the borrowing
costs.
All borrowing costs are charged to the Statement of
Profit and Loss except:
• Borrowing costs that are attributable to the
acquisition or construction of qualifying tangible
and intangible assets that necessarily take a
substantial period of time to get ready for their
intended use, which are capitalised as part of the
cost of such assets.
• Expenses incurred on raising long term borrowings
are amortised using effective interest rate method
over the period of borrowings.
Investment Income earned on the temporary investment
of funds of specific borrowings pending their expenditure
on qualifying assets is deducted from the borrowing
costs eligible for capitalisation.
l) Taxes on Income
Taxes on income comprises of current taxes and deferred
taxes.
Current tax is the amount of tax payable on the taxable
income for the year as determined in accordance with
the provisions of the Income Tax Act, 1961. Current tax
assets and tax liabilities are offset where the entity has
a legally enforceable right to offset and intends either to
settle on net basis, or to realize the asset and settle the
liability simultaneously.
Deferred tax is recognised on temporary differences,
being differences between the carrying amount of
assets and liabilities and corresponding tax bases used
in the computation of taxable profit. Deferred tax is
measured using the tax rates and the tax laws enacted
or substantively enacted as at the reporting date.
Deferred tax liabilities are recognised for all 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. Deferred tax assets and liabilities are
offset if such items relate to taxes on income levied by
the same governing tax laws and the Company has a
legally enforceable right for such set off. Deferred tax
assets are reviewed at each balance sheet date for their
realisability.
Current and deferred tax are recognised in profit or loss,
except when they relate to items that are recognised
in Other Comprehensive Income or directly in equity,
in which case, the current and deferred tax are also
recognised in Other Comprehensive Income or directly
in equity respectively.
m) Impairment of Property, Plant and Equipment and
Intangible Assets
The carrying values of assets / cash generating units at
each balance sheet date are reviewed for impairment.
If any indication of impairment exists, the recoverable
amount of such assets is estimated and impairment
is recognised, if the carrying amount of these assets
exceeds their recoverable amount. The recoverable
amount is the greater of the net selling price and their
value in use. Value in use is arrived at by discounting
the future cash flows to their present value based
on an appropriate pre-tax discount rate to determine
whether there is any indication that those assets have
suffered any impairment loss. When there is indication
that an impairment loss recognised for an asset in
earlier accounting periods no longer exists or may
have decreased, such reversal of impairment loss is
recognised in the Statement of Profit and Loss, except in
case of revalued assets.
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