1. Corporate Information
GANESH BENZOPLAST LIMITED (“the
Company”), was incorporated on May 15, 1986, CIN
L24200MH1986PLC039836. The Company is a public
limited company incorporated and domiciled in India
and is having its registered office at Dina Building, First
Floor, 53, Maharshi Karve Road, Marine Lines, Mumbai
- 400002, Maharashtra, India. The Company is listed
on Bombay Stock Exchange (BSE) and National Stock
Exchange (NSE) in India.
The Company operates a diversified business, primarily
engaged in providing conditioned storage facilities
for bulk liquids and chemicals at various ports across
India, as well as in the manufacturing and export of
premium specialty chemicals, food preservatives, and
industrial lubricants.
2. New and amended standards adopted by the
company
The Ministry of Corporate Affairs, vide notifications
dated September 9, 2024, and September 28,
2024, introduced the Companies (Indian Accounting
Standards) Second Amendment Rules, 2024, and
the Companies (Indian Accounting Standards)
Third Amendment Rules, 2024, respectively. These
amendments notified certain accounting standards,
namely Ind AS 117 relating to insurance contracts, and
amendments to Ind AS 116 concerning lease liability in
sale and leaseback transactions. The amendments are
effective for annual reporting periods beginning on or
after April 1, 2024. These changes did not have any
material impact on the amounts recognised in prior
periods and are not expected to significantly affect the
current or future periods.
3. Material accounting policies
The material accounting policies applied by the
Company in the preparation of its financial statements
are listed below. Such accounting policies have been
applied consistently to all the periods presented
in these financial statements, unless otherwise
indicated.
3.1 Statement of compliance
The financial statements have been prepared in
accordance with the Indian Accounting Standards
(referred to as “Ind AS”) prescribed under Section
133 of the Companies Act, 2013 read with
Companies (Indian Accounting Standards) Rules,
as amended from time to time and other relevant
provisions of the Act.
3.2. Basis of preparation of financial statements
The financial statements have been prepared
on the historical cost basis except for certain
financial assets and liabilities (including derivative
instruments) and plan assets under dened benet
plans, that are measured at fair values at the end
of each reporting period, as explained in the
accounting policies below.
Operating Cycle
The Company presents assets and liabilities in
the balance sheet based on current and non¬
current classification. An asset is classified as
current when it is expected to be realised, or
intended to be sold or consumed in the normal
operating cycle; held primarily for the purpose
of trading; expected to be realised within twelve
months after the reporting period; or is cash or a
cash equivalent unless it is 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 classified as current if it is expected to
be settled in the normal operating cycle, held for
trading, due within twelve months of the reporting
period, or if there is no unconditional right to defer
settlement for at least twelve months. All other
liabilities are treated as non-current. Deferred tax
assets and liabilities are classified as non-current.
The operating cycle, defined as the time between
asset acquisition and realization in cash or cash
equivalents, is identified as twelve months by the
Company.
3.3. Significant accounting judgements, estimates
and assumptions
In the preparation of financial statements, the
Company makes judgements in the application
of accounting policies; and estimates and
assumptions which affects carrying values of
assets and liabilities that are not readily apparent
from other sources. The estimates and associated
assumptions are based on historical experience
and other factors that are considered to be
relevant. Actual results may differ from these
estimates.
Estimates and the underlying assumptions
are continuously evaluated. Any changes to
accounting estimates are recognised in the
period of revision and, where applicable, in future
periods impacted by the revision.
The following are the critical estimates and
judgements, that have the significant effect on the
amounts recognized in the financial statements.
Useful lives of property, plant and equipment
The useful lives of property, plant, and equipment
are reviewed by management at least once
every three years. This review considers both the
technical lifespan of the assets and their expected
economic life, taking into account various internal
and external factors such as operating efficiency
and associated costs. Any changes resulting from
this reassessment may impact future depreciation
and amortisation expenses.
Impairment of investments in subsidiaries, joint
ventures and associates
Determining whether the investments in
subsidiaries are impaired requires an estimate
in the value in use of investments. The Company
reviews its carrying value of investments carried
at cost annually, or more frequently when there is
an indication for impairment.
The carrying amount of investment is tested
for impairment as a single asset by comparing
it’s value in use with its carrying amount, any
impairment loss recognised reduces the carrying
amount of investment.
While assessing value in use, the Board of
Directors has considered anticipated future
market conditions and other relevant factors
influencing the operations of these entities -
such as operating performance, strategic plans,
projected cash flows, overall economic outlook,
and key assumptions including estimated long¬
term growth rates, weighted average cost of
capital, and expected operating margins. The
cash flow forecasts are based on historical trends
and reflect management’s best estimate of future
developments.
Contingencies
In the ordinary course of business, the Company
may be exposed to contingent liabilities arising
from litigation and other claims. Obligations
that are considered possible, but not probable,
or those that cannot be measured reliably, are
classified as contingent liabilities. These are
disclosed in the notes to the financial statements
but are not recognised. Matters assessed by the
Company as remote are not disclosed. Contingent
assets are not recognised or disclosed unless
the inflow of economic benefits is considered
probable.
Fair value measurements
When the fair value of financial assets or liabilities
reported or disclosed in the financial statements
cannot be determined using quoted prices in
active markets, valuation techniques - such as
the discounted cash flow (DCF) model - are
applied. Inputs to these models are derived from
observable market data whenever possible;
however, where such data is unavailable,
judgment is exercised in estimating fair values.
This includes evaluating factors such as liquidity
risk, credit risk, and market volatility.
Impairment of trade receivables
Impairment provisions for trade receivables are
determined using assumptions regarding the
likelihood of default and expected loss rates.
The Company exercises judgment in formulating
these assumptions and in selecting inputs for the
impairment calculation. This assessment is based
on the Company’s historical experience, credit
risk evaluation, prevailing market conditions, and
forward-looking estimates as of the reporting
date.
Retirement benefit obligations
The Company’s retirement benefit obligations
rely on several key assumptions, such as discount
rates, inflation, and salary growth. Setting these
assumptions involves significant judgment, and
any changes to them can materially affect the
amounts reported in the balance sheet and the
statement of profit and loss. These assumptions
are determined based on past experience and
guidance from independent actuarial experts.
3.4. Property, Plant and Equipment (PPE)
Property, plant, and equipment (excluding
freehold land) that are used for producing or
supplying goods or services or for administrative
functions are recorded in the balance sheet at
historical cost, net of accumulated depreciation
and impairment losses, if any. The historical cost
comprises all expenses directly attributable to
the acquisition of the asset. Any subsequent
expenditure is added to the asset’s carrying
amount or treated as a separate asset, when it
is likely that future economic benefits will arise
from it and the cost can be measured reliably.
Freehold land is not subject to depreciation
Depreciation & amortization
Depreciation is recognised so as to write off
the cost of assets (other than freehold land and
properties under construction) less their residual
values over their useful lives, using the straight¬
line method. The estimated useful lives, residual
values and depreciation method are reviewed at
the end of each reporting period, with the effect
of any changes in estimate accounted for on a
prospective basis.
Depreciation on Property, Plant and Equipment
is charged using the straight-line method in
accordance with the useful lives prescribed
under Schedule II of the Companies Act, 2013,
except for certain assets whose useful lives have
been determined based on technical evaluation.
The assessment of useful life is made considering
technical guidance, the nature and expected
usage of the asset, operating conditions,
historical replacement trends, and anticipated
technological developments. The estimated
useful lives of these assets are as detailed below:
An item of property, plant and equipment is
derecognized 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 Standalone Statement of Profit
and Loss.
Capital work-in-progress
Capital work-in-progress represents assets
under construction intended for the production
or supply of goods or services, for administrative
use, or for yet-to-be-determined purposes. These
are recorded at cost, net of any recognised
impairment losses. Once an asset is ready for
its intended use as determined by management,
the related construction costs are reclassified
to the appropriate category under property,
plant, and equipment. Expenditure related to the
commissioning of such assets is capitalised when
the asset is ready for use and commissioning is
complete. Capital work-in-progress also includes
spare parts that are not yet in use.
3.5 Intangible assets
Intangible assets with finite useful lives that are
acquired separately are measured at cost, less
accumulated amortisation and any accumulated
impairment losses. Amortisation is charged on
a straight-line basis over the assets’ estimated
useful lives. Both the estimated useful life and
the amortisation method are reviewed at the end
of each reporting period, and any revisions to
estimates are applied prospectively.
Computer Software are amortised on straight
line basis over the estimated useful life ranging
between 4-6 years.
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
are recognised in the Statement of Profit and
Loss when the asset is derecognised.
3.6 Leases
The Company determines whether an
arrangement contains a lease by assessing
whether the fulfilment of a transaction is
dependent on the use of a specific asset and
whether the transaction conveys the right to
control the use of that asset to the Company in
return for payment.
The Company as lessee
The Company accounts for each lease component
within the contract separately from non-lease
components and allocates the consideration in
the contract to each lease component on the
basis of the relative stand-alone price of the lease
component and the aggregate standalone price
of the non-lease components. The Company
recognises right-of-use asset representing its
right to use the underlying asset for the lease
term at the lease commencement date. The cost
of the right-of-use asset measured at inception
comprises of the amount of initial measurement
of lease liability adjusted for any lease payments
made at or before the commencement date.
Certain lease arrangements include options to
extend or terminate the lease before the end
of the lease term. The right-of-use assets and
lease liabilities include these options when it is
reasonably certain that such options would be
exercised.
The right-of-use assets are subsequently
measured at cost less any accumulated
depreciation, accumulated impairment losses,
if any, and adjusted for any remeasurement of
the lease liability. The right-of-use assets are
depreciated using the straight-line method from
the commencement date over the shorter of
lease term or useful life of right-of-use asset.
Right-of-use assets are tested for impairment
whenever there is any indication that their carrying
amounts may not be recoverable. Impairment
loss, if any, is recognised in the statement of profit
and loss.
Lease liability is measured at the present value
of the lease payments that are not paid at the
commencement date of the lease. The lease
payments are discounted using the interest
rate implicit in the lease, if that rate can be
readily determined. If that rate cannot be readily
determined, the Company uses incremental
borrowing rate. The lease liability is subsequently
remeasured by increasing the carrying amount
to reflect interest on the lease liability, reducing
the carrying amount to reflect the lease payments
made and remeasuring the carrying amount to
reflect any reassessment or lease modifications.
The Company recognises the amount of the re¬
measurement of lease liability as an adjustment to
the right-of-use asset. Where the carrying amount
of the right-of-use asset is reduced to zero and
there is a further reduction in the measurement
of the lease liability, the Company recognises any
remaining amount of the remeasurement in the
statement of profit and loss.
Variable/ unexecuted lease payments not
included in the measurement of the lease
liabilities are expensed to the statement of profit
and loss in the period in which the events or
conditions which trigger those payments occur.
Payment made towards leases for which non¬
cancellable term is 12 months or lesser (short¬
term leases) and low value leases are recognised
in the statement of Profit and Loss as rental
expenses over the tenor of such leases.
The Company as lessor
(i) Operating lease - Rental income from
operating leases is recognised in the
statement of profit and loss on a straight¬
line basis over the term of the relevant lease
unless another systematic basis is more
representative of the time pattern in which
economic benefits from the leased asset
is diminished. Initial direct costs incurred
in negotiating and arranging an operating
lease are added to the carrying value of the
leased asset and recognised on a straight¬
line basis over the lease term.
(ii) Finance lease - When assets are leased
out under a finance lease, the present value
of minimum lease payments is recognised
as a receivable. The difference between
the gross receivable and the present value
of receivable is recognised as unearned
finance income.
Lease income is recognised over the term of
the lease using the net investment method
before tax, which reflects a constant periodic
rate of return. Such rate is the interest rate
which is implicit in the lease contract.
3.7 Financial instruments
Financial assets and financial liabilities are
recognised when the Company becomes a party
to the contractual provisions of the instrument.
Financial assets and liabilities are initially
measured at fair value. Transaction costs that are
directly attributable to the acquisition or issue
of financial assets and financial liabilities (other
than financial assets and financial liabilities at
fair value through profit and loss) are added to
or deducted from the fair value measured on
initial recognition of financial asset or financial
liability. The transaction costs directly attributable
to the acquisition of financial assets and financial
liabilities at fair value through profit and loss are
immediately recognised in the statement of profit
and loss. Trade receivables that do not contain a
significant financing component are measured at
transaction price.
Financial Asset
• Financial assets at amortised cost
Financial assets are subsequently measured
at amortised cost if these financial assets
are held within a business whose objective
is to hold these assets in order to collect
contractual cash flows and the contractual
terms of the financial asset give rise on
specified dates to cash flows that are solely
payments of principal and interest on the
principal amount outstanding.
• Effective interest method
Income is recognised on an effective
interest basis for financial assets other than
those financial assets classified as FVTPL or
FVOCI. Interest income is recognised in the
Statement of Profit and Loss.
• Financial assets measured at fair value
through profit or loss (FVTPL)
Financial assets are measured at fair value
through profit or loss unless it is measured
at amortised cost or at fair value through
other comprehensive income on initial
recognition. Gains or losses arising on
remeasurement are recognised in the
Statement of Profit and Loss.The net gain
or loss recognised in the Statement of Profit
and Loss incorporates any dividend or
interest earned on the financial asset and is
included in the ‘Other income’ line item.
• Impairment of financial assets
Loss allowance for expected credit losses is
recognised for financial assets measured at
amortised cost and fair value. The amount
of expected credit losses (or reversal) that
is required to adjust the loss allowance
at the reporting date is recognized as an
impairment gain or loss in the Statement of
Profit and Loss. The Company recognises
life time expected credit losses for all
trade receivables that do not constitute a
financing transaction.
For financial assets (apart from trade
receivables that do not constitute of
financing transaction) whose credit risk
has not significantly increased since
initial recognition, loss allowance equal
to twelve months expected credit losses
is recognised. Loss allowance equal to
the lifetime expected credit losses is
recognised if the credit risk of the financial
asset has significantly increased since initial
recognition.
• Derecognition of financial assets
The Company de-recognises a financial
asset only when the contractual rights to
the cash flows from the asset expire, or it
transfers the financial asset and substantially
all risks and rewards of ownership of the
asset to another entity.
If the Company neither transfers nor retains
substantially all the risks and rewards of
ownership and continues to control the
transferred asset, the Company recognises
its retained interest in the assets and an
associated liability for amounts it may have
to pay.
If the Company retains substantially all
the risks and rewards of ownership of a
transferred financial asset, the Company
continues to recognise the financial asset
and also recognises a borrowing for the
proceeds received.
Financial Liabilities and equity instruments
• Classification as debt or equity
Financial liabilities and equity instruments
issued by the Company are classified
according to the substance of the
contractual arrangements entered into and
the definitions of a financial liability and an
equity instrument.
• Equity instruments
An equity instrument is any contract that
evidences a residual interest in the assets
of the Company after deducting all of its
liabilities. Equity instruments are recorded
at the proceeds received, net of direct issue
costs.
• Financial liabilities
Trade and other payables are initially
measured at fair value, net of transaction
costs, and are subsequently measured at
amortised cost, using the effective interest
rate method where the time value of money
is significant.
Interest bearing bank loans, overdrafts and
issued debt are initially measured at fair
value and are subsequently measured at
amortised cost using the effective interest
rate method. Any difference between the
proceeds (net of transaction costs) and the
settlement or redemption of borrowings is
recognised over the term of the borrowings
in the statement of profit and loss.
• De-recognition of financial liabilities
The Company de-recognises financial
liabilities when, and only when, the
Company’s obligations are discharged,
cancelled or they expire.
3.8 Borrowing Costs
Borrowing costs include finance costs calculated
using the effective interest method in respect
of assets acquired on lease and exchange
differences arising on foreign currency
borrowings, to the extent they are regarded as
an adjustment to finance costs.
Finance expenses are recognised immediately in
the Statement of Prot and Loss, unless they are
directly attributable to qualifying assets, which
are assets that necessarily take a substantial
period of time to get ready for their intended use
or sale in which case they are capitalised until
such time as the assets are substantially ready
for their intended use or sale.
All other borrowing costs are recognised in the
Statement of Profit and Loss in the period in
which they are incurred
3.9 Revenue Recognition
Liquid Storage Tanks
Revenue from liquid storage contracts is
recognized on a straight-line/pro-rata basis over
the contract period, reflecting the continuous
transfer of services to customers. Customer
advances are recorded as contract liabilities,
while revenue recognized in excess of billings is
presented as contract assets.
EPC Business
The Company enters into long-term fixed-price
or variable-price engineering, procurement,
and construction (EPC) contracts. Revenue is
recognized over time using the percentage-of-
completion method (input method, based on
actual cost incurred to date as a proportion of
total estimated contract cost), as performance
obligations are satisfied through continuous
transfer of control to customers.
Variable consideration such as escalation clauses,
penalties, or scope variations is recognized
only when it is highly probable that a significant
reversal will not occur. Contract costs are
recognized in line with Ind AS 115, and expected
losses on contracts are recognized immediately
in the Statement of Profit and Loss.
The portion of actual cost incurred, in proportion
to the total estimated contract cost, is charged to
the profit and loss account, while the remaining
balance is carried as inventory (work-in-progress)
in the financial statements.
Sale of Products (Chemicals & Lubricants)
Revenue from the sale of products is recognized
at the fair value of consideration received or
receivable, net of discounts, rebates, incentives,
returns, and applicable GST/duties. Revenue is
recognized when control of the goods passes
to the customer, which generally coincides with
delivery to the customer or handover to the
carrier for export, whichever occurs earlier. At this
point, risks and rewards are transferred, and the
customer assumes full discretion over the goods.
Export incentives are recognized as income
under the applicable scheme.
Services
Revenue from contract manufacturing, ancillary
services related to storage operations, handling,
or maintenance is recognized in the period
in which the services are rendered, based
on contractual terms. Invoices are raised in
accordance with agreements and are usually
payable within the agreed credit period.
3.10 Other Income
Interest income
Interest income is accrued on a time proportion
basis, by reference to the principal outstanding
and effective interest rate applicable.
Dividend income
Dividend income from investments is recognised
when the right to receive payment has been
established.
3.11 Employee Benefits
Defined contribution plans
Contributions under defined contribution plans
are recognised as an expense for the period in
which the employee has rendered the service.
Payments made to state managed retirement
benefit schemes are dealt with as payments
to defined contribution schemes where the
Company’s obligations under the schemes
are equivalent to those arising in a defined
contribution retirement benefit scheme.
Defined benefit plan
For defined benefit retirement schemes, the cost
of providing benefits is determined using actuarial
valuation which being carried out at each year-
end balance sheet date. Re-measurement gains
and losses of the net defined benefit liability/
(asset) are recognised immediately in other
comprehensive income. The service cost and net
interest on the net defined benefit liability/(asset)
are recognised as an expense within employee
costs.
Past service cost is recognised as an expense
when the plan amendment or curtailment occurs
or when any related restructuring costs or
termination benefits are recognised, whichever is
earlier.
The retirement benefit obligations recognised in
the balance sheet represents the present value
of the defined benefit obligations as reduced by
the fair value of plan assets.
Compensated absences
Liabilities recognised in respect of other long¬
term employee benefits such as annual leave and
sick leave 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
using the projected unit credit method with
actuarial valuation being carried out at each
yearend balance sheet date. Actuarial gains and
losses arising from experience adjustments and
changes in actuarial assumptions are charged or
credited to the statement of profit and loss in the
period in which they arise.
Compensated absences which are not expected
to occur within twelve months after the end of
the period in which the employee renders the
related service are recognised based on actuarial
valuation.
3.12 Income Taxes
Current income tax
The tax currently payable is based on taxable
profit for the year. Taxable profit differs from
net profit as reported in the statement of profit
and loss because it excludes items of income or
expense that are taxable or deductible in other
years and it further excludes items that are never
taxable or deductible. The Company’s liability for
current tax is calculated using tax rates and tax
laws that have been enacted or substantively
enacted by the end of the reporting period.
Deferred Tax
Deferred tax is the tax expected to be payable
or recoverable on differences between the
carrying value of assets and liabilities in the
financial statements and the corresponding
tax bases used in the computation of taxable
profit and is accounted for using the balance
sheet liability method. Deferred tax liabilities are
generally recognised for all taxable temporary
differences. In contrast, deferred tax assets are
only recognised to the extent that it is probable
that future taxable profits will be available against
which the temporary differences can be utilized.
The carrying value 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 is calculated at the tax rates that are
expected to apply in the period when the liability
is settled or the asset is realised based on the
tax rates and tax laws that have been enacted or
substantially 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 value of
its assets and liabilities.
Current and deferred tax are recognised as an
expense or income in the statement of profit and
loss, except when they relate to items credited
or debited either in other comprehensive income
or directly in equity, in which case the tax is also
recognised in other comprehensive income or
directly in equity.
3.13 Foreign currency transactions functional and
presentation currency
The financial statements of the Company are
presented in Indian Rupee (“RS”), which is the
functional currency of the Company and the
presentation currency for the financial statements.
In preparing the financial statements, transactions
in currencies other than the entity’s functional
currency are recorded at the rates of exchange
prevailing on the date of the transaction. At
the end of each reporting period, monetary
items denominated in foreign currencies are re¬
translated at the rates prevailing at the end of
the reporting period. Non-monetary items carried
at fair value that are denominated in foreign
currencies are retranslated at the rates prevailing
on 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
translated.
Exchange differences arising on the re-translation
or settlement of other monetary items are
included in the statement of profit and loss for the
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