Material Accounting Policies and other explanatory information
for the year ended 31 March, 2026
COMPANY OVERVIEW, BASIS OF PREPARATION AND MATERIAL ACCOUNTING POLICIES
I. CORPORATE INFORMATION:
Greenlam Industries Limited (the 'Company') is a public limited company domiciled in India incorporated under the provisions of the Companies Act 1956. Its shares are listed on two recognized stock exchanges in India i.e. NSE and BSE. The registered office of the company is located at 203, 2nd floor, West Wing, Worldmark 1, Aerocity, IGI Airport, Hospitality District, New Delhi-110037, India.
Company is engaged in the business of manufacturing of laminates, decorative veneers, Engineered wooden Flooring and Doors and Plywood and allied products through its factories at Behror, Nalagarh, Prantij and Tindivanam having branches and dealers' network spread all over the country. It has Four overseas wholly owned subsidiary companies i.e., Greenlam Asia Pacific Pte Ltd, Greenlam America Inc., GRLAM Trading and Greenlam Overseas Bengal Ltd and one Domestic wholly owned subsidiary Greenlam Limited ( Formerly known as Greenlam South Limited) and also 11 overseas step down subsidiaries.
II. BASIS OF PREPARATION OF FINANCIAL STATEMENTS:
a. STATEMENT OF COMPLIANCE
These Standalone Financial Statements have been prepared in accordance with Indian Accounting Standards (Ind AS) as prescribed under section 133 of the Companies Act, 2013 read with Rule 3 of the Companies (Indian Accounting Standards) Rules, 2015 as amended by Companies (Indian Accounting Standards) Amendment Rules, 2016.
The financial statements of the Company for the year ended 31 March, 2026 are authorized for issue in accordance with a resolution of the Directors on 22 May, 2026.
b. BASIS OF MEASUREMENT
The financial statements have been prepared under the historical cost basis, except derivative financial instruments and defined benefit liability which have been measured at fair value.
c. ACCOUNTING ESTIMATES AND ASSUMPTIONS:
The preparation of the financial statements in conformity with Ind AS requires management to make estimates, judgments and assumptions. These estimates, judgments and assumptions affect the application of accounting policies and the reported amounts of assets and liabilities, the disclosures of contingent assets and liabilities at the date of the financial statements and reported amounts of revenues and expenses during the period. Management believes that estimates used in the preparation of the financial statements are prudent and reasonable.
Accounting estimates could change from period to period. Actual results could differ from those estimates. Appropriate changes in estimates are made as management becomes aware of changes in circumstances surrounding the estimates. Changes in estimates are reflected in the financial statements in the period in which changes are made and, if material, their effects are disclosed in the notes to the financial statements.
d. FUNCTIONAL AND PRESENTATION CURRENCY
The financial statements are presented in Indian Rupee (T), which is the Company's functional and presentation currency. All amounts have been rounded off to nearest crores, unless otherwise indicated. Wherever the amount represents 'H0' (zero) construes value less than Rupee One lakh, Adding the individual figures may therefore not always results in exact total given.
e. CURRENT OR NON CURRENT CLASSIFICATION
Based on the nature of the business of the Company and its business time cycle from inception of an order and its completion on realization in cash and cash equivalents, the Company has ascertained the operating cycle as 12 months for the purpose of current and non-current classification of assets and liabilities.
III. MATERIAL ACCOUNTING POLICY
The Company has consistently applied the following accounting policies to all periods presented in the financial statements.
1.01 PROPERTY, PLANT AND EQUIPMENT:
Property, Plant and Equipment are stated at cost, net of recoverable taxes, trade discount and rebates less accumulated depreciation and impairment losses, if any. Such cost includes purchase price, borrowing cost and any cost directly attributable to bringing the assets to its working condition for its intended use. Other Indirect Expenses incurred relating to project, net of income earned during the project development stage prior to its intended use, are considered as pre-operative expenses and disclosed under Capital Work-in-Progress. Subsequent expenditure is capitalised only when it increases the future economic benefits embodied in the specific asset to which it relates. Property, plant and equipment is eliminated from the financial statements on disposal and gain or loss is recognised in Statement of Profit and Loss. Depreciation is provided based on useful life of the assets as prescribed in Schedule II to the Companies Act, 2013. The residual values, useful lives and methods of depreciation of Property, Plant and Equipment are reviewed at each financial year end and adjusted prospectively, if appropriate.
1.01.1 Investment Property includes Land and/or Building held for capital appreciation and/or rental income. It is measured initially at cost including directly attributable expenses. Subsequently, it is being measured at cost less accumulated depreciation & accumulated impairment losses.
1.02 INTANGIBLE ASSETS:
Intangible assets are initially measured at cost and subsequently measured at cost less accumulated amortisation and any accumulated impairment losses. Subsequent expenditure is capitalised only when it increases the future economic benefits embodied in the specific asset to which it relates. Amortisation is calculated to write off the cost of intangible assets less their estimated residual values over their estimated useful lives using the straight-line method, and is included in depreciation and amortisation in Statement of Profit and Loss. The estimated useful lives for computer software is 5 years. Amortisation method, useful lives are reviewed at the end of each financial year and adjusted if appropriate.
1.03 IMPAIRMENT:
The Company's non-financial assets other than inventories are reviewed at each reporting date to determine whether there is any indication of impairment. If any such indication exists, then the asset's recoverable amount is estimated and difference is recognised as impairment losses in Statement of Profit and Loss.
1.04 INVENTORIES:
Inventories which comprise raw materials, work-in-progress, finished goods, stores and spares are measured at the lower of cost and net realisable value. The cost of inventories is ascertained on the 'weighted average' basis, and includes expenditure incurred in acquiring the inventories, production or conversion costs and other costs incurred in bringing them to their present location and condition.
1.05 FINANCIAL INSTRUMENTS:
Financial assets
On initial recognition, a financial asset is classified and measured at Amortised cost or Fair value through Profit or Loss (FVTPL) or Fair value through Other Comprehensive Income (FVTOCI). Financial assets at FVTPL are subsequently measured at fair value. Net gains and losses, including any interest or dividend income, are recognised in Statement of Profit and Loss. Financial assets at amortised cost are subsequently measured at amortised cost using the effective interest rate (EIR) method. The amortised cost is reduced by impairment losses, if any. Interest income, foreign exchange gains and losses and impairment are recognised in Statement of Profit and Loss. Any gain or loss on derecognition is recognised in Statement of Profit and Loss.
The Company uses 'Expected Credit Loss' (ECL) model, for evaluating impairment of Financial Assets other than those measured at Fair Value Through Profit or Loss (FVTPL). For Trade Receivables, the Company applies 'simplified approach' which requires provision based on historical credit loss experience. For other assets, the Company uses 12 month ECL to provide for impairment loss where there is no significant increase in credit risk. If there is significant increase in credit risk full lifetime ECL is used.
Financial liabilities
Financial liabilities are classified and measured at amortised cost or FVTPL. Financial liabilities at FVTPL are measured at fair value and net gains and losses are recognised in Statement of Profit and Loss that includes derivative financial instruments entered into by the Company. Other financial liabilities are subsequently measured at amortised cost using the effective interest rate (EIR) method. Interest expense and foreign exchange gains and losses are recognised in Statement of Profit and Loss. Any gain or loss on derecognition is also recognised in Statement of Profit and Loss. Interest bearing loans and borrowings are subsequently measured at amortised cost using the EIR method. For trade and other payables maturing within one year from the balance sheet date, the carrying amounts approximates fair value due to the short maturity of these instruments.
Offsetting
Financial assets and financial liabilities are offset and the net amount presented in the balance sheet when and only when, the Company currently has a legally enforceable right to set off the amounts and it intends either to settle them on a net basis or to realise the asset and settle the liability simultaneously.
Derivative financial instruments
The Company holds derivative financial instruments, such as foreign currency forward contracts to hedge its foreign currency risk exposures. Derivatives are initially measured at fair value. Subsequent to initial recognition, derivatives are measured at fair value, and changes therein are recognised in Statement of Profit and Loss. Derivatives are carried as financial assets when the fair value is positive and as financial liabilities when the fair value is negative.
1.06 REVENUE RECOGNITION:
Revenue from contracts with customers is recognised when control of the goods are transferred to the customer at an amount that reflects the consideration entitled in exchange for those goods and there is no unfulfilled obligation that could affect the dealer's acceptance of the products. The goods are sold with annual volume discounts, cash discount on payment within specified period and other promotional expenses such as tours packages to dealer. A liability (netted off with trade receivables) is recognised for expected volume discounts, expected cash discounts to dealers in relation to sales made until the end of the year. Payment terms agreed with the dealers are as per business practice.
1.06.01 Other Revenue
Interest: 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.
Dividends: Dividend from investment is recognized when the Company in which they are held declares the dividend and when the right to receive the same is established.
Insurance Claims: Insurance Claims are accounted for on acceptance and when there is a reasonable certainty of receiving the same, on grounds of prudence.
Export Incentives: Benefit on account of entitlement to import goods free of duty under the Advance Authorisation Scheme, Duty Free Import Authorisation (DFIA), are accounted for on accrual basis at estimated realisable value, as and when exports are made
Government grants: Grants related to revenue are recognised in the Statement of Profit and Loss on a systematic basis in the periods in which the Company recognises the related costs for which the grants are intended to compensate and are netted off with the related expenditure. If not related to a specific expenditure, it is taken as income and presented under Other Income. Government grants relating to property, plant and equipment are treated as deferred income and are credited to the statement of profit and loss based on settlement of relevant obligations attached to the grants.
1.07 FOREIGN CURRENCY TRANSACTIONS:
Transactions in foreign currencies are translated into the functional currency of the Company at the exchange rates prevailing at the dates of the transactions. Monetary assets and liabilities denominated in foreign currencies are translated into the functional currency at the exchange rate at the reporting date. Exchange differences are recognised in the Statement of Profit and Loss in the period in which they arise.
1.08 EMPLOYEE BENEFITS:
Short-term employee benefits
Short-term employee benefit obligations are measured on an undiscounted basis and are expensed as the related service is provided.
Defined contribution plans
A defined contribution plan is a post-employment benefit plan under which an entity pays fixed contributions into Employees' Provident Fund established under The Employees' Provident Fund and Miscellaneous Provisions Act 1952 and will have no legal or constructive obligation to pay further amounts. Obligations for contributions to defined contribution plans are recognised as an employee benefit expense in Statement of Profit and Loss in the periods during which the related services are rendered by employees.
Defined benefit plans and other long-term employee benefits
The liability towards gratuity and long term compensated absences is determined by independent actuaries using the projected unit credit method. Remeasurement of defined benefit plans, comprising of actuarial gains or losses, return on plan assets excluding interest income are recognised immediately in Balance Sheet with corresponding debit or credit to other comprehensive income. Remeasurements are not reclassified to profit or loss in subsequent period. Remeasurement gains or losses on long term compensated absences that are classified as other long term benefits are recognised in profit or loss.
1.09 BORROWING COSTS:
Borrowing costs are interest and other costs (including exchange differences relating to foreign currency borrowings to the extent they are regarded as an adjustment to interest costs) incurred in connection with the borrowing of funds. Borrowing costs directly attributable to acquisition or construction of an asset which necessarily take a substantial period of time to get ready for their intended use are capitalised as part of the cost of that asset. Other borrowing costs are recognised as an expense in the period in which they are incurred.
1.10 LEASES:
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. The right-of-use assets are subsequently depreciated over the shorter of the asset's useful life and the lease term on a straight-line basis. In addition, the right-of-use asset is reduced by impairment losses, if any, and adjusted for certain remeasurements of the lease liability. The lease liability is initially measured at amortised cost at the present value of the future lease payments, discounted using the interest rate implicit in the lease or, if that rate cannot be readily determined, using the incremental borrowing rate. 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 on a straight-line basis over the lease term.
1.11 ACCOUNTING FOR TAXES ON INCOME:
Current tax
The Company's current tax is calculated using tax rates that have been enacted or substantively enacted by the end of the reporting period. Current tax assets and current tax liabilities are offset, if entity has a legally enforceable right to set off recognised amounts and intends to settle on net basis or to realise the current tax asset and settle the current tax liabilities simultaneously.
Deferred tax
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. Deferred tax assets and deferred tax liabilities are offset, if a legally enforceable right exists to set off current tax assets against current tax liabilities, and the deferred taxes relate to the same taxable entity and the same taxation authority.
1.12 PROVISIONS, CONTINGENT LIABILITIES AND CONTINGENT ASSETS:
Provisions are recognised when the Company has a present obligation (legal or constructive) as a result of a past event, it is probable that an outflow of resources embodying economic benefits will be required to settle the obligation and a reliable estimate can be made of the amount of the obligation. If the effect of the time value of money is material, provisions are discounted using a current pre-tax rate that reflects, when appropriate, the risks specific to the liability. When discounting is used, the increase in the provision due to the passage of time is recognised as a finance cost.
Disclosure of contingent liability is made when there is a possible obligation arising from past events, the existence of which will be confirmed only by the occurrence or non-occurrence of one or more uncertain future events not wholly within the control of the Company or a present obligation that arises from past events where it is either not probable that an outflow of resources embodying economic benefits will be required to settle or a reliable estimate of amount cannot be made.
1.13 SEGMENT REPORTING:
Operating Segments are reported in a manner consistent with the internal reporting provided to the chief operating decision maker (CODM). The CODM assesses the financial performance and position of the company, and makes strategic decisions. The CODM consists of Managing Director & CEO and Chief Financial Officer.
The Company's operating businesses are organized and managed separately according to the nature of products, with each segment representing a strategic business unit that offers different products and serves different markets. The identified segments are Manufacturing and Sale of (a) Laminate and Allied products; and (b) Plywood and Allied products
The analysis of geographical segment is based on the geographical location of the customers. The geographical segments considered for disclosure are (a) Sales within India include sales to customers located within India; (b) Sales outside India include sales to customers located outside India.
Common allocable costs are allocated to each segment according to the ratio of their respective turnover to the total turnover.
The Unallocated Segment includes general corporate income and expense items, which are not allocated to any business segment.
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