2A. MATERIAL ACCOUNTING POLICIES:(i) Basis of Preparation

The Standalone Financial Statements have been

prepared in accordance with Indian Accounting

Standards (I nd AS) notified under the Companies (Indian
Accounting Standards) Rules, 2015 (as amended from
time to time) and presentation requirements of Division
II of Schedule III to the Companies Act, 2013, (Ind AS
compliant Schedule III), as applicable to the standalone
financial statements.

The standalone financial statements have been

prepared on a historical cost basis, except for the
following assets and liabilities which have been

measured at fair value or other amount, as required by
applicable accounting guidance.

• Derivative financial instruments,

• Certain financial assets and liabilities measured
at fair value (refer accounting policy regarding
financial instruments), and

• Defined benefit pension plans - plan assets are
measured at fair value

• Equity settled ESOP at grant date fair value

I n addition, the carrying values of recognised assets
and liabilities designated as hedged items in fair value
hedges that would otherwise be carried at amortised
cost are adjusted to record changes in the fair values
attributable to the risks that are being hedged in
effective hedge relationships. The standalone financial
statements are presented in ' and all values are
rounded to the nearest Lakhs (' 00,000), except when
otherwise indicated.

The Company has prepared the standalone financial
statements on the basis that it will continue to operate
as a going concern.

(ii) Current versus non-current classification

Based on the time involved between the acquisition of
assets for processing and their realisation in cash and
cash equivalents, the Company has identified twelve
months as its operating cycle for determining current
and non-current classification of assets and liabilities
in the balance sheet.

Deferred tax assets and liabilities are classified as non¬
current assets and liabilities.

(iii) Foreign currencies• Functional and presentation currency

The standalone Financial statements are presented
in ', which is Company's functional currency.

• Transactions and balances

Foreign currency transactions are translated into
the functional currency using the exchange rates
at the dates of the transactions. Foreign exchange
gains and losses resulting from the settlement
of such transactions and from the translation of
monetary assets and liabilities denominated in
foreign currencies at year end exchange rates are
generally recognised in profit or loss. They are
deferred in other comprehensive income if they
relate to qualifying cash flow hedges.

Foreign exchange differences on foreign currency
borrowings are presented in the Statement of
profit and loss, within finance costs. All other
foreign exchange gains and losses are presented
in the Statement of profit and loss on a net basis
within other income or other expenses.
Non-monetary items that are measured at fair
value in a foreign currency are translated using
the exchange rates at the date when the fair
value was determined. Translation differences
on assets and liabilities carried at fair value are
reported as part of the fair value gain or loss.

2B. SUMMARY OF MATERIAL ACCOUNTING POLICIES:(i) Revenue from contract with customer

Revenue from contracts with customers is recognised
when the control of goods or services are transferred
to the customer at an amount that reflects the
consideration to which the Company expects to entitle
in exchange for the goods or services. The Company
has concluded that it is the principal in all its revenue
arrangements, because it typically controls the goods
or services before transferring them to the customers.
The disclosures of significant accounting judgments,
estimates and assumptions relating to revenue from
contracts with customers are provided in Note 2C.

Sale of Goods: Revenue from the sale of goods is
recognised at the point in time when control of the
asset is transferred to the customer, generally on
delivery of goods. The normal credit term is 7 to 150
days.

The Company considers whether there are other
promises in the contract that are separate performance
obligations to which a portion of the transaction price
needs to be allocated (e.g., warranties, customer loyalty
points). In determining the transaction price for the
sale of equipment, the Company considers the effects
of variable consideration, the existence of significant
financing components, noncash consideration, and
consideration payable to the customer (if any).
Variable Consideration

I f the consideration in a contract includes a variable
amount, the Company estimates the amount of
consideration to which it will be entitled in exchange
for transferring the goods to the customer. The variable
consideration is estimated at contract inception and
constrained until it is highly probable that a significant
revenue reversal in the amount of cumulative revenue
recognised will not occur when the associated
uncertainty with the variable consideration is
subsequently resolved. Contracts for the sale of goods
provide customers with a customary right of return in
case of defects, quality issues etc. The rights of return
give rise to variable consideration.

Rights of return

The Company uses the expected value method to
estimate the goods that will not be returned because
this method best predicts the amount of variable
consideration to which the Company will be entitled.
The requirements in Ind AS 115 on constraining
estimates of variable consideration are also applied in
order to determine the amount of variable consideration
that can be included in the transaction price. For goods
that are expected to be returned, instead of revenue,
the Company recognises a refund liability. A right of
return asset (and corresponding adjustment to cost
of sales) is also recognised for the right to recover
products from a customer.

The disclosures of significant estimates and
assumptions if any, relating to the estimation of variable
consideration for returns are provided in Note 2C.

Sale of Services: Revenue from sale of services in
the nature of tooling income, including die design and
preparation charges, is recognised when the Company
has fulfilled its performance obligation, when the
samples of tools/die are submitted to the customer
and formal approval is obtained from the customer.

Export Incentives: Revenue from export incentives is
accounted for on export of goods if the entitlements
can be estimated with reasonable assurance and
conditions precedent to claim are fulfilled.

Trade Receivables: A receivable is recognised if an
amount of consideration that is unconditional (i.e., only
the passage of time is required before payment of the
consideration is due). Refer to accounting policies of
financial assets in Section (ix) Financial instruments -
initial recognition and subsequent measurement.
Contract liabilities: A contract liability is recognised if a
payment is received, or a payment is due (whichever is
earlier) from a customer before the Company transfers
the related goods or services. Contract liabilities are
recognised as revenue when the Company performs
under the contract (i.e., transfers control of the related
goods or services to the customer).

Contract assets: A contract asset is initially recognised
for revenue earned from installation services because
the receipt of consideration is conditional on successful
completion of the installation. Upon completion of
the installation and acceptance by the customer, the
amount recognised as contract assets is reclassified
to trade receivables.

Contract assets are subject to impairment assessment.
Refer to accounting policies on impairment of financial
assets in section d) Financial instruments - initial
recognition and subsequent measurement.

Other Income

Dividend Income: Dividend income is recognised when
the right to receive payment is established, which is
generally when shareholders approve the same.
Interest Income: Interest is recognised using the
effective interest rate (EIR) method, as income for the
period in which it occurs. EIR is the rate that exactly
discounts the estimated future cash payments or
receipts over the expected life of the Financial instrument
to the gross carrying amount of the financial asset or
to the amortised cost of a financial liability.

(ii) Government Grants

Government grants are recognised where there is
reasonable assurance that the grant will be received,
and all attached conditions will be complied with.
When the grant relates to duty benefit availed under
Export Promotion Capital Goods (EPCG) Scheme, it is
accounted for by way of reducing the cost from related
asset and accordingly value of the asset has been
depreciated with such reduced cost.

When the grant relates to incentives under "Invest
Punjab Scheme", it is accounted as income on a

systematic basis over the period that the related costs,
for which it is intended to compensate are incurred.
These incentives are accrued as income once the
approval of the relevant authority is sanctioned and
there is a reasonable assurance that the grant will be
received.

When loans or similar assistance are provided by
governments or related institutions, with an interest
rate below the current applicable market rate, the effect
of this favourable interest is regarded as a government
grant. The loan or assistance is initially recognised and
measured at fair value and the government grant is
measured as the difference between the initial carrying
value of the loan and the proceeds received. The loan
is subsequently measured as per the accounting policy
applicable to financial liabilities.

(iii) Inventory Valuation

Inventories are valued at the lower of cost and net
realisable value.

Costs incurred in bringing each product to its present
location and condition are accounted for as follows:

• Raw materials: cost includes cost of purchase and
other costs incurred in bringing the inventories
to their present location and condition. Cost is
determined on first in, first out basis.

• Finished goods and work in progress: cost
includes cost of direct materials and labour and
a proportion of manufacturing overheads based
on the normal operating capacity but excluding
borrowing costs. Cost is determined on first in,
first out (FIFO) basis.

• Packing Materials and other products are
determined on Weighted Average basis.

• Stores and Spares is value at Weighted Average
Value.

• Scrap is valued at estimated realisable value.

Net realisable value is the estimated selling price in the
ordinary course of business, less estimated costs of
completion and estimated costs necessary to make
the sale.

(iv) Cash and Cash Equivalents

Cash and cash equivalents in the balance sheet
comprise cash on hand, cash at banks and short-term
deposits with banks with an original maturity of three
months or less, that are readily convertible to a known
amount of cash and subject to an insignificant risk of
change in value.

(v) Property, Plant and Equipment

Capital work in progress is stated at cost, net of
accumulated impairment loss, if any. Plant and
equipment are stated at cost, net of accumulated
depreciation and accumulated impairment losses, if any.
Cost comprises purchase price and directly attributable
cost of bringing the asset to its working condition for
the intended use. Any trade discounts and rebates
are deducted in arriving at the purchase price. Such
cost includes the cost of replacing part of the plant
and equipment and borrowing costs for long-term
construction projects if the recognition criteria are met.
Machinery spares which can be used only in connection
with an item of Property, Plant and equipment and
whose use is expected to be irregular are capitalised
and depreciated over the useful life of the principal
item of the relevant assets. When significant parts of
plant and equipment are required to be replaced at
intervals, the Company depreciates them separately
based on their specific useful lives. Likewise, when a
major inspection is performed, its cost is recognised in
the carrying amount of the plant and equipment as a
replacement if the recognition criteria are satisfied. All
other repair and maintenance costs are recognised in
profit or loss as incurred.

Depreciation

Depreciation for identified asset/components is
computed on straight line method based on useful
lives, determined based on internal technical evaluation
as follows:
*The Company, based on technical assessment made by
technical expert and management estimate, depreciates
certain items of plant and equipment over estimated useful
lives which are different from the useful life prescribed in
Schedule II to the Companies Act, 2013. The management
believes that these estimated useful lives are realistic and
reflect fair approximation of the period over which the assets
are likely to be used.

**Useful life mentioned is considering single shift working,
however depreciation charged based on average number of
shifts worked on an annual basis.

Any item of property, plant and equipment and any
significant part initially recognised is derecognised
upon disposal or when no future economic benefits
are expected from its use or disposal. Any gain or loss
arising on derecognition of the asset (calculated as the
difference between the net disposal proceeds and the
carrying amount of the asset) is included in income
statement when asset is derecognised.

The residual values, useful lives and method of
depreciation of property, plant and equipment are
reviewed at each financial year end and adjusted
prospectively, if appropriate.

(vi) Intangible Assets

Intangible assets acquired separately are measured
on initial recognition at cost. The cost of intangible
assets acquired in a business combination is their
fair value at the date of acquisition. Following initial
recognition, intangible assets are carried at cost less
any accumulated amortisation and accumulated
impairment losses. Internally generated intangibles,
excluding capitalised development costs, are not
capitalised and the related expenditure is reflected in
profit or loss in the period in which the expenditure is
incurred.

The useful lives of intangible assets are assessed as
either finite or indefinite.

Intangible assets with finite lives are amortised over
the useful economic life and assessed for impairment
whenever there is an indication that the intangible
asset may be impaired. The amortisation period and
the amortisation method for an intangible asset with
a finite useful life are reviewed at least at the end
of each reporting period. Changes in the expected
useful life or the expected pattern of consumption
of future economic benefits embodied in the asset
are considered to modify the amortisation period or
method, as appropriate, and are treated as changes in
accounting estimates. The amortisation expense on
intangible assets with finite lives is recognised in the
statement of profit and loss unless such expenditure
forms part of carrying value of another asset.

An intangible asset is derecognised upon disposal (i.e.,
at the date the recipient obtains control) or when no
future economic benefits are expected from its use or
disposal. Any gain or loss arising upon derecognition
of the asset (calculated as the difference between the
net disposal proceeds and the carrying amount of the
asset) is included in the statement of profit and loss.
when the asset is derecognised.

(vii) Research and development costs

Expenditure on research activities is recognised as
an expense in the period in which it is incurred. An
internally generated intangible asset arising from
development (or from the development phase of an
internal project) is recognised if, and only if, all of the
following have been demonstrated:

- the technical feasibility of completing the
intangible asset so that it will be available for use
or sale;

- the intention to complete the intangible asset and
use or sell it;

- the ability to use or sell the intangible asset;

- how the intangible asset will generate probable
future economic benefits;

- the availability of adequate technical, financial
and other resources to complete the development
and to use or sell the intangible asset; and

- the ability to measure reliably the expenditure
attributable to the intangible asset during its
development.

Following initial recognition of the development
expenditure as an asset, the asset is carried at cost
less any accumulated amortisation and accumulated
impairment losses. Amortisation of the asset begins
when development is complete, and the asset is
available for use. It is amortised over the period of
expected future benefit. amortisation expense is
recognised in the statement of profit and loss unless
such expenditure forms part of carrying value of
another asset. During the period of development, the
asset is tested for impairment annually.

(viii) Investment in Subsidiary

A subsidiary is an entity that is controlled by another
entity.

Control exists when the Company is exposed, or has
rights, to variable returns from its involvement with
an investee and has the ability to affect those returns
through its power over the investee.

The Company controls an investee if, and only if, it has:

a. power over the investee, i.e., existing rights that
give it the current ability to direct the relevant
activities of the investee;

b. exposure, or rights, to variable returns from its
involvement with the investee; and

c. t he ability to use its power over the investee to

affect the amount of its returns.

The Company's investments in its subsidiary are
accounted at cost less impairment.

(ix) Impairment of non- financial assets

The Company assesses at each reporting date, whether
there is an indication that an asset may be impaired.
If any indication exists, or when annual impairment
testing for an asset is required, the Company estimates
the asset's recoverable amount. An asset's recoverable
amount is the higher of an asset's or cash generating
units (CGU)'s fair value less costs of disposal and its
value in use. The recoverable amount is determined for
an individual asset, unless the asset does not generate
cash inflows that are largely independent of those from
other assets or groups of assets. Where the carrying
amount of an asset or CGU exceeds its recoverable
amount, the asset is considered impaired and is written
down to its recoverable amount.

In assessing value in use, the estimated future cash
flows are discounted to their present value using a
pre-tax discount rate that reflects current market
assessments of the time value of money and the risks
specific to the asset. In determining fair value less
costs of disposal, recent market transactions are taken
into account. If no such transactions can be identified,
an appropriate valuation model is used. These
calculations are corroborated by valuation multiples,
quoted share prices for publicly traded companies or
other available fair value indicators.

The Company bases its impairment calculation on
detailed budgets and forecast calculations, which are
prepared separately for each of the Company's CGUs
to which the individual assets are allocated. These
budgets and forecast calculations generally cover a
period of five years. For longer periods, a long-term
growth rate is calculated and applied to project future
cash flows after the fifth year. To estimate cash flow
projections beyond periods covered by the most
recent budgets/forecasts, the Company extrapolates
cash flow projections in the budget using a steady
or declining growth rate for subsequent years, unless
an increasing rate can be justified. In any case, this
growth rate does not exceed the long-term average
growth rate for the products, industries, or country or
countries in which the Company operates, or for the
market in which the asset is used. Impairment losses
including impairment on inventories, are recognised in
the statement of profit and loss.

For assets excluding goodwill, an assessment is made
at each reporting date to determine whether there is

an indication that previously recognised impairment
losses no longer exist or have decreased. If such
indication exists, the Company estimates the asset's
or CGU's recoverable amount. A previously recognised
impairment loss is reversed only if there has been a
change in the assumptions used to determine the
asset's recoverable amount since the last impairment
loss was recognised. The reversal is limited so that
the carrying amount of the asset does not exceed its
recoverable amount, nor exceed the carrying amount
that would have been determined, net of depreciation,
had no impairment loss been recognised for the
asset in prior years. Such reversal is recognised in the
statement of profit and loss unless the asset is carried
at a revalued amount, in which case, the reversal is
treated as a revaluation increase.

Intangible assets with indefinite useful lives are tested
for impairment annually at the end of the financial
year at the CGU level, as appropriate, and when
circumstances indicate that the carrying value may be
impaired.

(x) Financial Instrument

A Financial Instrument is any contract that gives rise to
a financial asset of one entity and a financial liability or
equity instrument of another entity.

Financial AssetsInitial recognition and measurement

Financial assets are classified, at initial recognition, as
subsequently measured at amortised cost, fair value
through other comprehensive income (OCI), and fair
value through profit or loss

The classification of financial assets at initial
recognition depends on the financial asset's contractual
cash flow characteristics and the Company's business
model for managing them. With the exception of trade
receivables that do not contain a significant financing
component or for which the Company has applied the
practical expedient, the Company initially measures
a financial asset at its fair value plus, in the case of
a financial asset not at fair value through profit or
loss, transaction costs. Trade receivables that do not
contain a significant financing component or for which
the Company has applied the practical expedient are
measured at the transaction price determined under
Ind AS 115. Refer to the accounting policies in section
(i) Revenue from contracts with customers.

In order for a financial asset to be classified and
measured at amortised cost or fair value through
OCI, it needs to give rise to cash flows that are 'solely
payments of principal and interest (SPPI)' on the

principal amount outstanding. This assessment is
referred to as the SPPI test and is performed at an
instrument level. Financial assets with cash flows that
are not SPPI are classified and measured at fair value
through profit or loss, irrespective of the business
model.

Purchases or sales of financial assets that require
delivery of assets within a time frame established by
regulation or convention in the marketplace (regular way
trades) are recognised on the trade date, i.e., the date
that the Company commits to purchase or sell the asset.

Subsequent measurement

For purposes of subsequent measurement, financial
assets are classified in four categories:

• Financial assets at amortised cost (debt

instruments)

• Financial assets at fair value through other

comprehensive income (FVTOCI) with recycling of
cumulative gains and losses (debt instruments)

• Financial assets designated at fair value through
OCI with no recycling of cumulative gains and
losses upon derecognition (equity instruments)

• Financial assets at fair value through profit or loss

a. Financial Assets at amortised Cost (debt

instruments)

A 'financial asset' is measured at the amortised
cost if both the following conditions are met:

• The asset is held within a business model
whose objective is to hold assets for
collecting contractual cash flows, and

• Contractual terms of the asset give rise on
specified dates to cash flows that are solely
payments of principal and interest (SPPI) on
the principal amount outstanding.

After initial measurement, such financial assets
are subsequently measured at amortised cost
using the effective interest rate (EIR) method.
Amortised cost is calculated by taking into
account any discount or premium on acquisition
and fees or costs that are an integral part of the
EIR. The EIR amortisation is included in finance
income in the profit or loss. The losses arising
from impairment are recognised in the profit
or loss. The Company's financial assets at
amortised cost includes trade receivables, and
loan to employees included under other current
financial assets.

b. Financial assets at fair value through other
comprehensive income (FVTOCI) (debt instrument)

A 'financial asset' is classified as at the FVTOCI if
both of the following criteria are met:

• The objective of the business model is
achieved both by collecting contractual cash
flows and selling the financial assets, and

• The asset's contractual cash flows represent
SPPI.

Debt instruments included within the FVTOCI
category are measured initially as well as at each
reporting date at fair value. For debt instruments,
at fair value through OCI, interest income, foreign
exchange revaluation and impairment losses
or reversals are recognised in the profit or
loss and computed in the same manner as for
financial assets measured at amortised cost. The
remaining fair value changes are recognised in
OCI. Upon derecognition, the cumulative fair value
changes recognised in OCI is reclassified from the
equity to profit or loss.

c. Financial assets designated at fair value through
OCI (equity instruments)

Upon initial recognition, the Company can elect
to classify irrevocably its equity investments as
equity instruments designated at fair value through
OCI when they meet the definition of equity under
Ind AS 32 Financial Instruments: Presentation
and are not held for trading. The classification
is determined on an instrument-by-instrument
basis. Equity instruments which are held for
trading and contingent consideration recognised
by an acquirer in a business combination to which
Ind AS103 applies are classified as at FVTPL.
Gains and losses on these financial assets are
never recycled to profit or loss. Dividends are
recognised as other income in the statement of
profit and loss when the right of payment has
been established, except when the Company
benefits from such proceeds as a recovery of
part of the cost of the financial asset, in which
case, such gains are recorded in OCI. Equity
instruments designated at fair value through OCI
are not subject to impairment assessment.

d. Financial Assets at Fair value through Profit or
Loss (FVTPL)

Financial assets at fair value through profit or
loss are carried in the balance sheet at fair value
with net changes in fair value recognised in the
statement of profit and loss.

This category includes derivative instruments and
listed equity investments which the Company had not
irrevocably elected to classify at fair value through OCI.
Dividends on listed equity investments are recognised
in the statement of profit and loss when the right of
payment has been established.

Investments in Mutual Funds are accounted for at Fair
value through Profit or Loss Account.

Embedded Derivatives

A derivative embedded in a hybrid contract, with a
financial liability or non-financial host, is separated
from the host and accounted for as a separate
derivative if: the economic characteristics and risks are
not closely related to the host; a separate instrument
with the same terms as the embedded derivative
would meet the definition of a derivative; and the hybrid
contract is not measured at fair value through profit or
loss. Embedded derivatives are measured at fair value
with changes in fair value recognised in profit or loss.
Reassessment only occurs if there is either a change
in the terms of the contract that significantly modifies
the cash flows that would otherwise be required or a
reclassification of a financial asset out of the fair value
through profit or loss category.

Impairment of Financial Assets

In accordance with Ind AS 109, the Company applies
expected credit loss (ECL) model for measurement
and recognition of impairment loss on the following
financial assets and credit risk exposure:

a) Financial assets that are debt instruments, and
are measured at amortised cost e.g. loans, debt
securities, deposits, trade receivables and bank
balance

b) Trade receivables or any contractual right to
receive cash or another financial asset that result
from transactions that are within the scope of Ind
AS 115

c) Financial assets that are measured at FVTOCI
The Company follows 'simplified approach' for
recognition of impairment loss allowance on trade
receivables.

The application of simplified approach does not require
the Company to track changes in credit risk. Rather,
it recognises impairment loss allowance based on
lifetime ECLs at each reporting date, right from its initial
recognition.

For recognition of impairment loss on other financial
assets and risk exposure, the Company determines
whether there has been a significant increase in the
credit risk since initial recognition. If credit risk has
not increased significantly, 12-month ECL is used to
provide for impairment loss. However, if credit risk
has increased significantly, lifetime ECL is used. If, in
a subsequent period, credit quality of the instrument
improves such that there is no longer a significant
increase in credit risk since initial recognition, then the
entity reverts to recognising impairment loss allowance
based on 12-month ECL.

Lifetime ECL are the expected credit losses resulting
from all possible default events over the expected
life of a financial instrument. The 12-month ECL is a
portion of the lifetime ECL which results from default
events that are possible within 12 months after the
reporting date.

ECL is the difference between all contractual cash
flows that are due to the Company in accordance
with the contract and all the cash flows that the entity
expects to receive (i.e., all cash shortfalls), discounted
at the original EIR. When estimating the cash flows, an
entity is required to consider:

• All contractual terms of the financial instrument
(including prepayment, extension, call and similar
options) over the expected life of the financial
instrument. However, in rare cases when the
expected life of the financial instrument cannot
be estimated reliably, then the entity is required
to use the remaining contractual term of the
financial instrument

• Cash flows from the sale of collateral held or
other credit enhancements that are integral to the
contractual terms

As a practical expedient, the Company uses a provision
matrix to determine impairment loss allowance on
portfolio of its trade receivables. The provision matrix
is based on its historically observed default rates
over the expected life of the trade receivables and
is adjusted for forward-looking estimates. At every
reporting date, the historical observed default rates are
updated and changes in the forward-looking estimates
are analysed.

ECL impairment loss allowance (or reversal)
recognised during the period is recognised as income/
expense in the statement of profit and loss. This
amount is reflected under the head 'other expenses' in
the statement of profit and loss.

The balance sheet presentation for various financial
i nstrum ents i s descri bed bel ow:

• Financial assets measured as at amortised
cost, contractual revenue receivables and lease
receivables:

ECL is presented as an allowance, i.e., as an integral
part of the measurement of those assets in the balance
sheet. The allowance reduces the net carrying amount.
Until the asset meets write-off criteria, the Company
does not reduce impairment allowance from the gross
carrying amount.

• Debt instruments measured at FVTOCI:

Since financial assets are already reflected at
fair value, impairment allowance is not further
reduced from its value. Rather, ECL amount is
presented as 'accumulated impairment amount'
in the OCI.

For assessing increase in credit risk and
impairment loss, the Company combines financial
instruments on the basis of shared credit risk
characteristics with the objective of facilitating
an analysis that is designed to enable significant
increases in credit risk to be identified on a timely
basis.

The Company does not have any purchased or
originated credit impaired (POCI) financial assets,
i.e., financial assets which are credit impaired on
purchase/origination.

e. Trade Receivables

Trade receivables are amounts due from
customers for goods sold or services performed
in the ordinary course of business. They are
generally due for settlement within one year and
therefore are all classified as current. Where
the settlement is due after one year, they are
classified as non-current. Trade receivables are
recognised initially at the amount of consideration
that is unconditional unless they contain
significant financing components, when they are
recognised at fair value. The Company holds the
trade receivables with the objective to collect the
contractual cash flows and therefore measures
them subsequently at amortised cost using the
effective interest method.

Trade receivables are disclosed in Note 9.
De-recognition of Financial Assets:

A financial asset (or, where applicable, a part
of a financial asset or part of a group of similar
financial assets) is primarily derecognised
(i.e., removed from the Company's balance sheet)
when:

(i) The right to receive cash flows from asset
have expired, or.

(ii) The Company has transferred its right to
receive cash flows from the asset or has
assumed an obligation to pay the received
cash flows in full without material delay
to a third party under a "pass-through"
arrangement and either:

a) The Company has transferred
substantially all the risks and rewards
of the asset, or

b) The Company has neither transferred
nor retained substantially all the risks
and rewards of the asset but has
transferred control of the asset.

When the Company has transferred its right to
receive cash flows from an asset or has entered
into a pass-through arrangement, it evaluates
if and to what extent it has retained the risks
and rewards of ownership. When it has neither
transferred nor retained substantially all of the
risks and rewards of the asset, nor transferred
control of the asset, the Company continues to
recognise the transferred asset to the extent of
the Company's continuing involvement. In that
case, the Company also recognises an associated
liability. The transferred asset and the associated
liability are measured on a basis that reflects
the rights and obligations that the Company has
retained.

Continuing involvement that takes the form of a
guarantee over the transferred asset is measured
at the lower of the original carrying amount of the
asset and the maximum amount of consideration
that the Company could be required to repay.

Financial Liabilities:Initial Recognition and Measurement.

Financial liabilities are classified, at initial
recognition, as financial liabilities at fair value
through profit or loss, loans and borrowings,
payables, or as derivatives designated as hedging
instruments in an effective hedge, as appropriate.
All financial liabilities are recognised initially at fair
value and, in the case of loans and borrowings and
payables, net of directly attributable transaction
costs. The Company's financial liabilities include
trade and other payables, loans and borrowings
including bank overdrafts, and derivative financial
instruments.

Subsequent Measurement

For purposes of subsequent measurement,

financial liabilities are classified in two categories:

• Financial liabilities at fair value through profit
or loss

• Financial liabilities at amortised cost (loans
and borrowings)

a) Financial Liabilities at Fair Value

through Profit or Loss

Financial liabilities at fair value through
profit or loss include financial liabilities
held for trading and financial liabilities
designated upon initial recognition
as at fair value through profit or loss.
The Company has not designated
any financial liabilities upon initial
measurement recognition at fair
value through profit or loss. Financial
liabilities at fair value through profit
or loss are at each reporting date
with all the changes recognised in the
Statement of Profit and Loss.

Financial liabilities are classified as
held for trading if they are incurred
for the purpose of repurchasing in the
near term. This category also includes
derivative financial instruments entered
into by the Company that are not
designated as hedging instruments
in hedge relationships as defined by
Ind AS 109. Separated embedded
derivatives are also classified as held
for trading unless they are designated
as effective hedging instruments.

Gains or losses on liabilities held for
trading are recognised in the profit or
loss.

Financial liabilities designated upon
initial recognition at fair value through
profit or loss are designated as such
at the initial date of recognition, and
only if the criteria in Ind AS 109 are
satisfied. For liabilities designated
as FVTPL, fair value gains/losses
attributable to changes in own credit
risk are recognised in OCI. These gains/
losses are not subsequently transferred
to P&L. However, the Company may
transfer the cumulative gain or loss

within equity. All other changes in fair
value of such liability are recognised
in the statement of profit and loss.
The Company has not designated any
financial liability as at fair value through
profit or loss.

b) Financial Liabilities measured at

Amortised Cost (Loan and Borrowings)

This is the category most relevant to
the Company. After initial recognition,
interest-bearing loans and borrowings
are subsequently measured at
amortised cost using the EIR method.
Gains and losses are recognised in
profit or loss when the liabilities are
derecognised as well as through the
effective interest rate (EIR) amortisation
process.

Amortised cost is calculated by taking
into account any discount or premium
on acquisition and fees or costs that
are an integral part of the EIR. The EIR
amortisation is included as finance
costs in the statement of profit and
loss.

This category generally applies to
borrowings. For more information refer
Note 14.

Financial guarantee contracts

Financial guarantee contracts issued by the
Company are those contracts that require a
payment to be made to reimburse the holder
for a loss it incurs because the specified
debtor fails to make a payment when due
in accordance with the terms of a debt
instrument. Financial guarantee contracts
are recognised initially as a liability at fair
value, adjusted for transaction costs that
are directly attributable to the issuance of
the guarantee. Subsequently, the liability is
measured at the higher of the amount of loss
allowance determined as per impairment
requirements of Ind AS 109 and the amount
recognised less, when appropriate, the
cumulative amount of income recognised in
accordance with the principles of Ind AS 115.

debt instruments, a reclassification is made
only if there is a change in the business
model for managing those assets. Changes
to the business model are expected to
be infrequent. The Company's senior
management determines change in the
business model as a result of external or
internal changes which are significant to the
Company's operations. Such changes are
evident to external parties. A change in the
business model occurs when the Company
either begins or ceases to perform an
activity that is significant to its operations.
If the Company reclassifies financial assets,
it applies the reclassification prospectively
from the reclassification date which is the
first day of the immediately next reporting
period following the change in business
model. The Company does not restate
any previously recognised gains, losses
(including impairment gains or losses) or
interest.

as financial liabilities when the fair value is negative.
The purchase contracts that meet the definition of
a derivative under Ind AS 109 are recognised in the
statement of profit and loss.

For the purpose of hedge accounting, at the inception
of a hedge relationship, the Company formally
designates and documents the hedge relationship to
which the Company wishes to apply hedge accounting
and the risk management objective and strategy for
undertaking the hedge.

The documentation includes identification of the
hedging instrument, the hedged item, the nature of the
risk being hedged, and how the Company will assess
whether the hedging relationship meets the hedge
effectiveness requirements (including the analysis of
sources of hedge ineffectiveness and how the hedge
ratio is determined). A hedging relationship qualifies
for hedge accounting if it meets all of the following
effectiveness requirements:

- There is 'an economic relationship' between the
hedged item and the hedging instrument.

- The effect of credit risk does not 'dominate the
value changes' that result from that economic
relationship.

- The hedge ratio of the hedging relationship is the
same as that resulting from the quantity of the
hedged item that the Company actually hedges
and the quantity of the hedging instrument that
the Company actually uses to hedge that quantity
of hedged item.

The Company designates certain foreign exchange
forward contracts as cash flow hedges to mitigate the
risk of foreign exchange exposure on highly probable
forecast sales transactions, and thereafter, as a fair
value hedge of the resulting receivables.

When a derivative is designated as a cash flow hedging
instrument, the effective portion of changes in the
fair value of the derivative is recognised in OCI, e.g.,
cash flow hedging reserve and accumulated in the
cash flow hedging reserve. Any ineffective portion of
changes in the fair value of the derivative is recognised
immediately in the statement of profit and loss. The
amount accumulated is retained in cash flow hedge
reserve and reclassified to profit or loss in the same
period or periods during which the hedged item affects
the statement of profit or loss. Under fair value hedge,
the change in the fair value of a hedging instrument
is recognised in the statement of profit and loss. The
change in the fair value of the hedged item attributable
to the risk hedged is recorded as part of the carrying
value of the hedged item and is also recognised in the
statement of profit and loss.

(xii) Retirement and other employee Benefitsa) Defined Contribution Scheme:Provident Fund

Contributions in respect of Employees are
made to the Fund administered by the Regional
Provident Fund Commissioner as per the
provisions of Employees' Provident Fund and
Miscellaneous Provisions Act, 1952 and are
charged to Statement of Profit and Loss as and
when services are rendered by employees. Such
benefits are classified as Defined Contribution
Schemes as the Company does not carry any
further obligations, apart from the contributions
made on a monthly basis to the Regional
Provident fund.

Employee's State Insurance

The Company maintains an insurance policy to
fund a post-employment medical assistance
scheme, which is a defined contribution plan. The
Company's contribution to State Plans namely
Employees' State Insurance Fund and Employees'
Pension Scheme are charged to the statement of
profit and loss every year.

If the contribution payable to the schemes for
service received before the balance sheet date
exceeds the contribution already paid, the deficit
payable to the scheme is recognised as a liability
after deducting the contribution already paid.
If the contribution already paid exceeds the
contribution due for services received before the
balance sheet date, then excess is recognised as
an asset to the extent that the pre-payment will
lead to, for example, a reduction in future payment
or a cash refund.

b) Defined Benefit Plan:Gratuity

The Company provides for gratuity, a defined
benefit plan (the "Gratuity Plan") covering eligible
employees in accordance with the Payment of
Gratuity Act, 1972. The Gratuity Plan provides
a lump sum payment to vested employees at
retirement, death, incapacitation or termination
of employment, of an amount based on the
respective employee's salary and the tenure
of employment. The gratuity plan in Company
is funded through annual contributions to Li fe
Insurance Corporation of India (LIC) under its
Company's Gratuity Scheme.

The Company's Liabilities on account of Gratuity
on retirement of employees are determined at the
end of each financial year on the basis of actuarial

valuation certificates obtained from Registered
Actuary in accordance with the measurement
procedure as per Indian Accounting Standard
(Ind AS)-19 'Employee Benefits'. The liability
or asset recognised in the balance sheet in
respect of defined benefit gratuity plans is the
present value of the defined benefit obligation
at the end of the reporting period less the fair
value of plan assets. The Company's liability
is actuarially determined (using the Projected
Unit Credit method) at the end of each year. The
present value of the defined benefit obligation is
determined by discounting the estimated future
cash outflows using interest rates of government
bonds. Re-measurement gains and losses arising
from experience adjustments and changes in
actuarial assumptions are charged or credited to
equity through other comprehensive income in
the period in which they arise. They are included
in retained earnings through OCI in the statement
of changes in equity and in the balance sheet.
Past-service costs are recognised immediately in
statement of profit and loss. Re-measurements
are not reclassified to profit or loss in subsequent
periods.

Past service costs are recognised in profit or
loss on the earlier of:

a) The date of the plan amendment or curtailment,
and

b) The date that the Company recognises related
restructuring costs

Net interest is calculated by applying the
discount rate to the net defined benefit liability
or asset. The Company recognises the following
changes in the net defined benefit obligation
as an expense in the consolidated statement of
profit and loss:

a) Service costs comprising current service
costs, past-service costs, gains and losses
on curtailments and non-routine settlements;
and

b) Net interest expense or income
Compensated Absences

Accumulated compensated absences are either
availed or encashed within 12 months from the
end of the year end are treated as short term
employee benefits. The Company measures the
expected cost of such absences as the additional
amount that it expects to pay as a result of the
unused entitlement that has accumulated at

the reporting date. The Company recognises
expected cost of short-term employee benefit
as an expense, when an employee renders the
related service.

The Company has a policy to encash the entire
leaves balance outstanding as at the end of the
year in the subsequent year.

Short-term obligations

Liabilities for wages and salaries, including non¬
monetary benefits that are expected to be settled
wholly within 12 months after the end of the
period in which the employees render the related
service are recognised in respect of employees'
services up to the end of the reporting period and
are measured at the amounts expected to be paid
when the liabilities are settled. The liabilities are
presented as current employee benefit obligations
in the balance sheet.

(xiii) Earnings per Share (EPS)

Basic earnings per share is computed by dividing net
profit or loss attributable to equity shareholders of the
Company (after deducting preference dividends and
attributable taxes) by the weighted average number of
equity shares outstanding during the period.

Partly paid equity shares are treated as a fraction of
an equity share to the extent that they are entitled to
participate in dividends relative to a fully paid equity
share during the reporting period. The weighted
average number of equity shares outstanding during
the period is adjusted for events such as bonus issue,
bonus element in a rights issue, share split, and reverse
share split (consolidation of shares) that have changed
the number of equity shares outstanding, without a
corresponding change in resources.

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

(xiv) Dividend

The Company recognises a liability to pay dividend
to equity holders when the distribution is authorised,
and the distribution is no longer at the discretion of
the Company. As per the corporate laws in India, a
distribution is authorised when it is approved by the
shareholders. A corresponding amount is recognised
directly in equity.

(xv) TaxesCurrent income tax

Current income tax assets and liabilities are measured
at the amount expected to be recovered from or paid
to the taxation authorities. The tax rates and tax laws
used to compute the amount are those that are enacted
or substantively enacted, at the reporting date.

Current income tax relating to items outside profit
or loss is recognised outside profit or loss (either in
other comprehensive income or in equity). Current tax
items are recognised in correlation to the underlying
transaction either in OCI or directly in equity.
Management periodically evaluates positions taken
in the tax returns with respect to situations in which
applicable tax regulations are subject to interpretation
and considers whether it is probable that a taxation
authority will accept an uncertain tax treatment. The
Company shall reflect the effect of uncertainty for each
uncertain tax treatment by using either most likely
method or expected value method, depending on which
method predicts better resolution of the treatment.

Deferred tax

Deferred tax is provided using the liability method on
temporary differences between the tax bases of assets
and liabilities and their carrying amounts for financial
reporting purposes at the reporting date. Deferred
tax liabilities are recognised for all taxable temporary
differences, except:

- when the deferred tax liability arises from the initial
recognition of goodwill or an asset or liability in
a transaction that is not a business combination
and, at the time of the transaction, affects neither
accounting nor taxable profit or loss.

Deferred tax assets are recognised for all deductible
temporary differences, the carry forward of unused
tax credits and any unused tax losses. Deferred tax
assets are recognised to the extent that it is probable
that taxable profit will be available against which
the deductible temporary differences and the carry
forward of unused tax credits and unused tax losses
can be utilised, except:

- When the deferred tax asset relating to the
deductible temporary difference arises from
the initial recognition of an asset or liability in a
transaction that is not a business combination
and, at the time of the transaction, affects neither
the accounting profit nor taxable profit or loss

The carrying amount of deferred tax assets is reviewed
at each reporting date and reduced to the extent that it
is no longer probable that sufficient taxable profit will
be available to allow all or part of the deferred income
tax asset to be utilised. Unrecognised deferred tax

assets are re-assessed at each reporting date and are
recognised to the extent that it has become probable
that future taxable profits will allow the deferred tax
asset to be recovered.

Deferred tax assets and liabilities are measured
using tax rates (and laws) that have been enacted or
substantively enacted tax rates expected to apply to
taxable income in the years in which the temporary
differences are expected to be received or settled.

Deferred tax relating to items recognised outside profit
or loss is recognised outside profit or loss (either in
other comprehensive income or in equity). Deferred tax
items are recognised in correlation to the underlying
transaction either in OCI or directly in equity.

Deferred tax assets and liabilities are offset when there
is a legally enforceable right to offset current tax assets
and liabilities and when the deferred tax balances relate
to the same taxation authority. Current tax assets and
tax liabilities are offset where the entity has a legally
enforceable right to offset and intends either to settle
on a net basis, or to realise the asset and settle the
liability simultaneously.

Goods and Services Tax (GST)/value added taxes paid
on acquisition of assets or on incurring expenses

Expenses and assets are recognised net of the amount
of GST/value added taxes paid, except:

- When the tax incurred on a purchase of assets
or services is not recoverable from the taxation
authority, in which case, the tax paid is recognised
as part of the cost of acquisition of the asset or as
part of the expense item, as applicable

- When receivables and payables are stated with
the amount of tax included

The net amount of tax recoverable from, or payable to,
the taxation authority is included as part of receivables
or payables in the balance sheet.