1.1 The Company overview:
JK Tyre & Industries Limited (JKTIL) is a public limited Company
incorporated and domiciled in India and its shares are publicly
traded on the National Stock Exchange ('NSE') and the Bombay
Stock Exchange ('BSE') in India. The registered office of the
Company is situated at Jaykaygram, PO - Tyre Factory, Kankroli -
313 342, Rajasthan, India.
JKTIL develops, manufactures, markets and distributes
automotive Tyres, Tubes, Flaps and Retreads. The Company
sells its Tyres to vehicle manufacturers for fitment in original
equipment and in replacement markets worldwide. The
Company has nine manufacturing plants located in Rajasthan,
Madhya Pradesh, Tamil Nadu, Karnataka and Uttarakhand.
These financial statements were approved and adopted by
board of directors of the Company in their meeting held on
26th May, 2026.
1.2 Basis of preparation and measurement of financial
statements:
The 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 Companies
(Indian Accounting Standards) Rules 2015, as amended from
time to time and other relevant provisions of the Companies Act,
2013. All accounting policies and applicable IND AS have been
applied consistently for all periods presented.
The functional currency of the Company is Indian rupee (').
The financial statements have been prepared under historical
cost convention on accrual basis, except for the items that have
been measured at fair value as required by relevant Ind AS. The
financial statements correspond to the classification provisions
contained in Ind AS-1 (Presentation of Financial Statements).
The preparation of these financial statements requires
management judgements, estimates and assumptions that
affect the application of accounting policies, the accounting
disclosures made and the reported amounts of assets,
liabilities, income, and expenses. Estimates and underlying
assumptions are reviewed on a periodic basis. Revisions to
accounting estimates are recognised in the period in which
the estimates are revised if the revision affects only that period
of revision and future periods also if the revisions affects both
current and future periods.
(i) Property, plant and equipment:
a) Property, plant and equipment are measured at
cost less accumulated depreciation and impairment
losses, if any. Cost includes expenses directly
attributable to bringing the asset to the location and
condition necessary for it to be capable of operating
in the manner intended by management.
Expenditure during construction/erection period
is included under capital work-in-progress, which
is allocated to the respective property, plant and
equipment on completion of construction/erection.
b) Depreciation on property, plant and equipment
(including Continuous Process Plants considered
on technical evaluation) has been provided using
Straight line method over their useful lives and in
the manner prescribed under Schedule II of the
Companies Act, 2013. However, in respect of certain
property, plant and equipment, depreciation is
provided as per their useful lives as assessed by the
management supported by technical advice ranging
from 15 to 35 years for plant and machinery and 15
to 70 years for buildings. Accelerated depreciation
in respect of a production accessory is provided
over 6 years.
The carrying amount is eliminated from the financial
statements, upon sale and disposition of the assets
and the resultant gains or losses are recognised in the
statement of profit and loss.
(ii) Lease:
a) The Company, as a lessee, at the inception of contract,
assesses whether the contract is a lease or not. If yes,
the contract conveys in favour of the Company, the
right to control the use of an identified asset for a
period of time in exchange for consideration.
The right-of-use assets are initially recognized at
cost, which comprises of the initial amount of the
lease liability adjusted for any lease payments
made at or prior to the commencement date of
the lease plus any initial direct costs less any lease
incentives. In the Balance Sheet, Right-of-use Assets
are presented under respective items of Property,
Plant and Equipment or Investment Property, as the
case may be. The lease liability is initially measured at
amortized cost at the present value of the future lease
payments. The lease payments are discounted using
the interest rate implicit in the lease or, if not readily
determinable, using the incremental borrowing
rates of the Lessee. In addition, the carrying amount
of lease liabilities and right-of-use assets are re¬
measured if there is a modification, a change in the
lease term, a change in the lease payments (e.g.,
changes to future payments resulting from a change
in an index or rate used to determine such lease
payments) or a change in the assessment of an option
to purchase the underlying asset.
b) Depreciation on Right-of-use Asset has been provided
using Straight line method over their useful lives or
lease period, whichever is lower. Interest Expense
on Lease Liabilities are provided using discount rate
used to determine Lease Liabilities. Depreciation and
Interest expenses are recognised in the Statement of
Profit and Loss.
c) For short-term leases and leases for which, the
underlying asset value is low, right-of-use assets
and lease liabilities are not recognised. The
lease payments associated with these leases are
recognised as expense over the lease term.
d) The Company, as a lessor, recognises lease payments
from operating leases as income on straight-line basis
over the lease term. The Company has recognised
costs, including depreciation, incurred in earning the
lease income as an expense.
(iii) Inventories:
Inventories are valued at lower of cost and net realisable
value. However, materials and other supplies held for use
in production of inventories are not written down below
cost, if the finished goods are expected to be sold at or
above cost. The cost is computed on weighted average
basis. Finished Goods, Traded Goods and Process Stock
include cost of purchase, cost of conversion and other
costs incurred in bringing the inventories to their present
location and condition. Slow-moving and obsolete items
based upon technical evaluation are provided for.
(iv) Employee benefit:
Employee benefits include wages & salaries, provident
fund, superannuation fund, employee state insurance
scheme, gratuity fund and compensated absences, etc.
(a) Defined-contribution plans
Contributions to the employees' regional provident
fund, superannuation fund, Employees' Pension
Scheme and Employees' State Insurance are
recognised as defined contribution plan and
charged as expenses during the period in which the
employees perform the services.
(b) Defined-benefit plans
Retirement benefits in the form of Gratuity and
Leave Encashment are considered as defined benefit
plan and determined on actuarial valuation using
the Projected Unit Credit Method at the balance
sheet date. Actuarial Gains or Losses through re¬
measurement of the net obligation of a defined
benefit liability or asset is recognised in Other
Comprehensive Income. Such re-measurements
are not reclassified to Statement of Profit and Loss in
subsequent periods.
The Provident Fund Contribution other than
contribution to Employees' Regional Provident Fund,
is made to trust administered by the trustees. The
interest rate to the members of the trust shall not be
lower than the statutory rate declared by the Central
Government under Employees' Provident Fund and
Miscellaneous Provision Act, 1952. The Employer shall
make good deficiency, if any.
(c) Short term employee benefits
Short term benefits are charged off at the
undiscounted amount in the year in which the related
service is rendered.
(v) Income tax:
Income tax is comprised of current and deferred tax.
Income tax expense is recognised in the Statement of Profit
and Loss, except to the extent it relates to items directly
recognised in equity or in other comprehensive income.
recognition, are held to collect contractual
cash flows of principal and interest on principal
amount outstanding on specified dates, as
well as held for selling. Therefore, they are
subsequently measured at each reporting
date at fair value, with all fair value movements
recognised in Other Comprehensive Income
(OCI). Interest income calculated using the
effective interest rate (EIR) method on time
proportionate basis, impairment loss or
gain and foreign exchange loss or gain are
recognised in the Statement of Profit and Loss.
On derecognition of the asset, cumulative
gain or loss previously recognised in Other
Comprehensive Income is reclassified from the
OCI to Statement of Profit and Loss.
• Financial assets at fair value through profit or
loss: At the date of initial recognition, financial
assets are held for trading, designated financial
assets to be valued through profit or loss or
which are measured neither at Amortised Cost
nor at Fair Value through OCI. Therefore, they
are subsequently measured at each reporting
date at fair value, with all fair value movements
recognised in the Statement of Profit and
Loss. Dividend income on equity shares is
recognised when the right to receive payment
is established, which becomes certain after
shareholders' approval. Interest and Dividend
Income as well as fair value changes are
disclosed separately in the Statement of Profit
& Loss.
I nvestment in Equity shares of subsidiaries and
associates are valued at cost.
The Company derecognises a financial asset when
the contractual rights to the cash flows from the
financial asset expires or it transfers the financial asset
and the transfer qualifies for derecognition under Ind
AS 109. Upon derecognition the difference between
the carrying amount of a financial asset derecognised
and the sum of the consideration received and
receivable and the cumulative gain or loss that had
been recognised in other comprehensive income
and accumulated in equity is recognised in the
Statement of Profit and Loss.
(a) Current tax: Current Tax is the amount of tax payable
on the estimated taxable income for the current year
as per the provisions of Income Tax Act, 1961.
(b) Deferred tax: Deferred tax liabilities are generally
recognised for all taxable temporary differences.
Deferred tax assets are generally recognised for
all deductible temporary differences, unabsorbed
losses and unabsorbed depreciation to the extent,
it is probable that taxable income will be available
against which the same can be realised. Deferred tax
assets are reviewed at the end of each subsequent
reporting period.
(vi) Financial Instruments:
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.
(a) Financial assets
Financial assets include cash and cash equivalents,
trade and other receivables, investments in securities
and other eligible current and non-current assets.
At initial recognition, all financial assets are measured
at fair value. However, trade receivables that do
not contain a significant financing component are
measured at transaction price. The fi nancia l assets a re
subsequently classified under one of the following
three categories according to the purpose for which
they are held. The classification is reviewed at the end
of each reporting period.
• Financial assets at amortised cost: At the
date of initial recognition, are held to collect
contractual cash flows of principal and interest
on principal amount outstanding on specified
dates. These financial assets are intended to
be held until maturity. Therefore, they are
subsequently measured at amortised cost
by applying the Effective Interest Rate (EIR)
method to the gross carrying amount of the
financial asset. The EIR amortisation is included
as interest income in the profit or loss on time
proportionate basis. The losses arising from
impairment are recognised in the profit or loss.
• Financial assets at fair value through other
comprehensive income: At the date of initial
The Company assesses impairment based on the
expected credit losses (ECL) model to all its financial
assets measured at amortised cost. 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 entity expects to receive
(i.e. all cash shortfalls) discounted at original effective
interest rate. Impairment loss allowance (or reversal)
for the period is recognised in the Statement of Profit
and Loss.
(b) Financial liabilities
Financial liabilities include long-term and short-term
loans and borrowings, trade and other payables and
other eligible current and non-current liabilities.
All financial liabilities are recognised initially at
fair value and, in the case of loans and borrowings
and other payables, net of directly attributable
transaction costs. After initial recognition, financial
liabilities are classified under one of the following
two categories:
• Financial liabilities at amortised cost: After
initial recognition, such financial liabilities
are subsequently measured at amortised
cost by applying the Effective Interest Rate
(EIR) method to the gross carrying amount of
the financial liability. The EIR amortisation is
included in finance expense in the Statement
of Profit or Loss.
• Financial liabilities at fair value through profit
or loss: which are designated as such on initial
recognition, or which are held for trading. Fair
value gains/ losses attributable to changes
in own credit risk is recognised in OCI. These
gains/losses are not subsequently transferred
to Statement of Profit and Loss. All other
changes in fair value of such liabilities are
recognised in the Statement of Profit and Loss.
The Company derecognises a financial liability when
the obligation specified in the contract is discharged,
cancelled or expired. The difference between the
carrying amount of a financial liability derecognised
and the sum of consideration paid and payable is
recognised in Statement of Profit and Loss as other
income or finance costs/ other expenses.
(vii) Derivative financial instruments:
Derivative instruments such as forward currency contracts,
interest rate swaps and option contracts are used to
hedge foreign currency risks and interest rate risk. Such
derivatives are initially recognised at their fair values on the
date on which a derivative contract is entered into and are
subsequently re-measured at fair value on each reporting
date. Any gains or losses arising from changes in the fair
value of derivatives are taken directly to 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.
(viii) Compulsorily Convertible Debentures - Compound
Financial Instruments:
Compulsorily Convertible Debentures (CCDs) are treated as
compound financial instruments and these are separated
into liability and equity components based on the terms
of the contract. At the inception of the CCDs, the following
two elements are separated: (a) a liability component
arising from the interest payments, if any; and (b) an equity
component representing the delivery of fixed number of
equity shares in future. On issuance of the CCDs, the fair
value of the liability portion is determined using a market
interest rate for an equivalent non-convertible debt. This
amount is recorded as a liability on an amortised cost
basis, till its conversion into equity or payment, whichever
is earlier. The remainder of the proceeds is attributable to
the equity portion of the compound instrument and is not
subsequently remeasured. In addition, the component
classified as equity shall remain in equity till its conversion.
Transaction costs are apportioned between the liability and
equity components of the CCDs based on the allocation of
proceeds to the liability and equity components when the
instruments are initially recognised.
(ix) Revenue:
Revenue is recognised upon transfer of control of
promised goods or services to customers at transaction
price (net of taxes and duties), arrived at by determining
the consideration received or receivable after adjusting
returns, allowances, trade discounts, volume discounts etc.
in exchange of goods or services.
For applying above principle, the Company adopts five
step model, which are: a) Identify the contract(s) with
customer(s); b) Identify the performance obligations
under the contract(s); c) Determine the transaction price;
d) Allocate the transaction price to the performance
obligations in the contract(s); e) recognise revenue, when
or as the entity satisfies a performance obligation.
Contract Liabilities are recognised when there is an entity's
obligation to transfer goods or services to a customer for
which, the entity has received consideration from the
customer. Revenue in excess of invoicing are classified as
contract assets.
Sale of Goods:
Revenue from the sale of goods is recognised at the point
in time, when control is transferred to the customer.
Interest Income:
Interest income is recognized on time proportion basis
using the effective interest method.
Dividend income:
Dividend income is recognized when the right to receive
payment is established, which becomes certain after
shareholders' approval.
(x) Business Combination
Business combinations involving entities or businesses
under common control are accounted for using the
"pooling of interests method". Assets, liabilities and
reserves of the transferor entity are recognised at their
carrying amounts as appearing in the books of the
transferor. The difference between the consideration
paid and the net assets acquired is recognised in equity as
Capital Reserve.
Business Combinations which are other than under
common control, are accounted for using the acquisition
method. The cost of acquisition is measured at the
aggregate of the fair values at the date of exchange of
assets given, liabilities incurred or assumed and equity
instruments issued by the Company in exchange for control
of the acquiree. The acquiree's identifiable assets, liabilities
and contingent liabilities that meet the recognition criteria
are stated at their fair values at the acquisition date except
certain assets and liabilities required to be measured as per
the applicable standard.
The interest of non-controlling shareholders in the
acquiree is initially measured at the non-controlling
shareholders' proportionate share of the acquiree's
identifiable net assets.
Transaction costs related to such combinations are
recognised in the Statement of Profit and Loss as incurred.
(xi) Grants:
Grants and subsidies from the Government are recognised
when there is reasonable assurance that the grant/
subsidy will be received and all attaching conditions
will be complied with. Revenue Grants are recognised in
the Statement of Profit and Loss. Capital Grants relating
to specific assets are recognised in the Balance Sheet by
deducting the grant from carrying amount of the asset and
depreciation is charged on reduced carrying value of asset.
Export incentives are recognised in the Statement of Profit
and Loss.
(xii) Impairment:
The carrying amounts of Property, plant and equipment,
Intangible assets, Investment property and Investments
are reviewed at each Balance Sheet date to assess
impairment if any, based on internal/external factors. An
asset is treated as impaired, when the carrying cost of asset
exceeds its recoverable value, being higher of value in use
and net selling price. An impairment loss is recognised as
an expense in the Statement of Profit and Loss in the year
in which an asset is identified as impaired. The impairment
loss recognised in prior accounting period is reversed, if
there has been an improvement in recoverable amount.
(i) Rupee Term Loan of '231.06 crores and '10.97 crores from Banks and Foreign Currency Loan of '59.91 crores (including '27.05 crores due
to forex reinstatement) from a Financial Institution aggregating to '301.94 crores, secured by a first pari passu charge on movable and
immovable assets at a Company's Plant in Tamil Nadu, both present and future and also secured by way of hypothecation on the specified
movable assets at Company's Plants in Madhya Pradesh and Karnataka are repayable in 30, 6 and 8 equal quarterly instalments respectively.
(ii) Rupee Term Loan of '178.00 crores from a Bank, secured by a first pari passu charge on movable and immovable assets at a Company's
Plant in Tamil Nadu, both present and future is repayable in 30 quarterly instalments.
(iii) Rupee Term Loan of '174.88 crores (out of which '95.93 crores temporarily converted into Foreign Currency Loan) from Banks and '106.20
crores from Financial Institution respectively aggregating to '281.08 crores, secured by a first pari passu charge created on movable and
immovable assets at a Company's Plant in Madhya Pradesh, both present and future is repayable in 36 equal quarterly instalments.
(iv) Foreign Currency Loan of ' 203.66 crores (including '10.12 crores due to forex reinstatement) and '149.88 crores (including '6.90 crores
due to forex reinstatement) from Global Financial Institutions aggregating to ' 353.54 crores, secured by a first pari passu charge on
movable and immovable assets at a Company's Plant in Madhya Pradesh (excluding those specifically charged to other banks), both
present and future are repayable in 19 bi-annual equal instalments commencing from March, 2028 and 18 bi-annual unequal instalments
commencing from May, 2028 respectively.
(v) Rupee Term Loan of ' 39.58 crores from a Bank, secured by a first pari passu charge on movable fixed assets at a Company's Plant in Madhya
Pradesh (excluding those specifically charged to other banks), both present and future is repayable in 10 equal quarterly instalments.
(vi) Rupee Term Loan of ' 66.67 crores from a Bank, secured by a first pari passu charge on movable fixed assets at a Company's Plant in
Karnataka (excluding those specifically charged to other banks), both present and future is repayable in 16 equal quarterly instalments.
(vii) Rupee Term Loan of ' 30.94 crores from a Financial Institution, secured by specific charge over the moveable fixed assets at a Company's
Plant in Karnataka, both present and future is repayable in 40 equal quarterly instalments commencing from September, 2028.
(viii) Rupee Term Loan of '30.00 crores from a Bank, secured by a first pari passu charge over the moveable fixed assets at a Company's Plant
in Rajasthan, both present and future and is repayable in 24 equal quarterly instalments commencing from December, 2026.
(ix) Rupee Term Loans aggregating to ' 816.61 crores from Banks and Foreign Currency Loans of '438.65 crores (including '35.89 crores due
to forex reinstatement) from a Global Financial Institution aggregating to '1255.26 crores are secured with first pari passu charge on
movable and immovable assets at Company's plants in Uttrakhand, both present & future;
Foreign Currency Term Loans from Global Financial Institution aggregating to '438.65 crores are repayable in 19 un-equal bi-annual
instalments commencing from March, 2028 and Rupee Term Loans from Banks aggregating to '796.40 crores are repayable in 18 to 35
unequal quarterly instalments; Rupee term loan amounting to '20.21 crores from a bank is repayable in 30 equal quarterly instalments.
(x) Rupee Term Loan of '6.25 crores from banks are secured by subservient charge created on current assets and movable fixed assets at
Company's plants in Uttrakhand, both present and future. Further, the term loan will be fully repaid by July, 2026.
(xi) Above Term Loans from (i) to (x) carrying first pari passu charge on the movable and immovable assets, are subject to prior charge of banks
on stocks and book debts for working capital borrowings.
(xii) Fixed Deposits of '20.98 crores, '15.69 crores and '7.98 crores (aggregating '44.65 crores) are due for repayment in 2026-27, 2027-28 and
2028-29 respectively.
Note - 32
Estimated amounts of contracts remaining to be executed on capital account '771.35 crores (Previous year: '719.85 crores).
Note - 33
The Company imported certain equipment under Export Promotion Capital Goods (EPCG) Scheme at a concessional custom duty resulting in
cumulative savings of '108.24 crores (Previous year: '99.26 crores), against which export obligation fulfilled till 31st March, 2026 '35.26 crores
(Previous year: '23.45 crores). Balance obligation yet to be fulfilled is '72.98 crores (Previous year: '75.81 crores).
Note - 34
Contingent liabilities in respect of claims not accepted and not provided for '309.94 crores (Previous year: '384.75 crores) pertaining to matters
in appeal for Excise, Customs duty & GST '161.32 crores, Service tax '4.93 crore, Income tax matters '27.45 crores & others matters '116.24 crores
(Previous year: '237.32 crores, '4.93 crores, '27.45 crores & '115.05 crores respectively).
Note - 35
The Competition Commission of India ("CCI") on 2nd February, 2022 had released an Order dated 31st August, 2018 for alleged contravention
of provisions of the Competition Act, 2002 against the Company, certain other Tyre manufacturers and Automotive Tyre Manufacturers
Association. CCI had imposed a penalty of ' 309.95 crores on the Company. The Company had filed an Appeal before the Hon'ble National
Company Law Appellate Tribunal (NCLAT) against the said CCI Order. The NCLAT, through an order dated 1st December, 2022, has disposed of
the aforementioned appeal, after taking note of the multiple errors in the said CCI Order dated 31st August, 2018, and remanded the matter
back to the CCI, to re-examine the matter on merits and also to consider reviewing the penalty (if violation is established) in accordance with
the provisions of the Competition Act. CCI has since filed an appeal before Hon'ble Supreme Court of India against NCLAT order dated 1st
December 2022. Based on legal advice, the Company continues to believe that it has a strong case, and accordingly, no provision has been
made in the accounts. The Company strongly reiterates that there has been no wrongdoing on the part of the Company and reassures all
the stakeholders that the Company has never indulged in or was part of any cartel or undertook any anti-competitive practices.
Note - 40
Debts/Advances include '84.04 crores (Previous year '79.90 crores) for which legal and other necessary action has been taken.
Note - 41
In respect of certain disallowances and additions made by the Income Tax Authorities, appeals are pending before the Appellate Authorities
and adjustment, if any, will be made after the same are finally determined.
Note - 42
The details of amounts outstanding under the Micro, Small and Medium Enterprises Development Act, 2006 to the extent of information
available with the Company are as under:
Principal & Interest amount due and remaining unpaid as at 31.03.2026: Nil (Previous year: Nil), (ii) Payment made beyond the appointed day
during the year: Nil (Previous year: Nil) and (iii) Interest Accrued and unpaid as at 31.03.2026: Nil (Previous year: Nil).
Note - 43
The Company has borrowings from Banks and Financial Institutions on the basis of securities of Current Assets. It has also filed the quarterly
statements of current assets with all consortium banks and Financial Institutions during the year and these statements agree with the salient
relevant items of books of account of the Company.
Note - 44
a) The Company has utilised the borrowings received from banks and financial institutions for the purpose for which it was taken during
the year.
b) I n the FY 2024, the Company had raised '491.60 crores (net of share issue expenses) through Qualified Institutional Placement of
1,44,92,749 equity shares of '2 each at a premium of '343 per share. The same have been fully utilised for the purpose it was intended for.
Note - 48 Business Combination
The Board of Directors at its meeting held on 16th September, 2024, approved the Scheme of Amalgamation of Cavendish Industries Ltd. ("CIL"),
a subsidiary, with the Company. The Appointed Date of the Scheme was 1st April 2025. The Scheme was approved by the Hon'ble National
Company Law Tribunal, Jaipur ("the Tribunal") vide its Order dated 20th November, 2025, the certified copy of which was received on 24th
November, 2025. The Scheme became effective on 22nd December, 2025 upon filing of the said Order of the Tribunal with the Registrar of
Companies, Rajasthan.
Pursuant to the Scheme, the Company has accounted for the amalgamation in accordance with Appendix C of Ind AS 103 - Business
Combinations of Entities under Common Control, applying the pooling of interest method retrospectively from the earliest period presented.
The difference between the Net Identifiable Assets acquired and the consideration paid has been recognised as Capital Reserve in the restated
financial statements. Consequently, the previous year figures for the year ended 31st March, 2025 are presented in these financial statements
after being restated to include the impact of the Scheme of amalgamation.
The Company allotted 1,42,69,484 equity shares of face value ?2/- each to the eligible shareholders of erstwhile CIL, in the swap ratio of 92
equity shares of ?2/- each for every 100 equity shares of ?10/- each held in CIL. Accordingly, the issued and paid-up equity share capital of the
Company has increased from '54.80 crores to '57.66 crores. The equity shares issued pursuant to the Scheme have been considered for the
purpose of computing basic and diluted earnings per share for all periods presented.
Note - 47 Exceptional Items include:
a) Unfavorable foreign exchange fluctuation of ' 49.38 crores (Previous Year: '13.63 crores) and VRS expense '30.16 crores (Previous Year:
'3.29 crores).
b) Stamp duty expense of ' 32.50 crores pursuant to the Scheme of Amalgamation of Cavendish Industries Ltd.
c) The Government of India notified the four Labour Codes (New Labour Codes) effective from 21st November, 2025. On the basis of draft
Central Rules and FAQs issued by the Ministry of Labour & Employment (MoLE), the Company has assessed the incremental impact
towards retiral obligations at ' 56.75 crores and disclosed the same as Exceptional Item in line with the guidance provided by the
Institute of Chartered Accountants of India. The Company will continue to monitor developments relating to the New Labour Codes
and would provide appropriate accounting effect, as needed.
Note - 54 Other statutory Information
a. The Company does not have any Benami property, where any proceeding has been initiated or pending against the Company for
holding any Benami property.
b. The Company has not been declared wilful defaulter by any Banks or any other Financial Institution at any time during the financial year.
c. The Company has not revalued its Property, Plant and Equipment (including Right of use assets) or intangible assets during the year.
d. The Company did not have any material transactions with companies struck-off under section 248 of the companies Act, 2013 or
section 560 of the companies Act, 1956 during the financial year.
e. The Company has not traded or invested in Crypto Currency or Virtual Currency during the year.
f. The Company does not have any charges or satisfaction, which is yet to be registered with Registrar of Companies (ROC) beyond the
statutory period.
g. During the year, the Company has not advanced or loaned or invested funds to any other person(s) or entity(ies), including foreign
entities (Intermediaries) with the understanding that the Intermediary shall:
i. directly or indirectly lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the Company
(Ultimate Beneficiaries) or
ii. provide any guarantee, security or the like to or on behalf of the Ultimate Beneficiaries.
h. The Company has not received any fund from any person(s) or entity(ies), including foreign entities (Funding Party) with the
understanding (whether recorded in writing or otherwise) that the Company shall:
i. directly or indirectly lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the Funding
Party (Ultimate Beneficiaries) or
ii. provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries
i. The Company has no such transactions which is not recorded in the books of accounts that has been surrendered or disclosed as
income during the year in tax assessments under Income Tax Act, 1961.
j. The Company has not made any Loans or Advances to any promoters, directors, KMPs and the related parties (as defined under the
Companies Act, 2013), either severally or jointly with any other person, that are:
i. repayable on demand; or
ii. without specifying any terms or period of repayment.
Note - 55 Recent Accounting Pronouncements
Ministry of Corporate Affairs ("MCA") has notified following amendments to the existing Ind-AS effective from FY2025-26:
a. Ind AS 21 - The Effects of Changes in Foreign Exchange Rates. The Company has reviewed the amendment and based on its evaluation
has determined that it does not have any impact in its financial statements.
b. Ind AS 1- Presentation of Financial Statements, relating to classification of liabilities as current or non-current and non-current liabilities
with covenants. The Company has reviewed the amendment and based on its evaluation has determined that it does not have any
significant impact in its financial statements.
c. Ind AS 7- Statement of Cash Flows and Ind AS 107- Financial Instruments, require detailed disclosure for Supplier Finance Arrangements
and effect of such arrangements on cash flows. For the current year, this disclosure is not applicable.
d. Ind AS 12- Income Taxes, related to mandatory disclosure of Impact of OECD Pillar Two Model Rules and temporary exemption from
Deferred tax recognition on the same - The Company has reviewed the amendment related to application of Pillar two rules and
determined that the same is not expected to have material financial impact on the Company.
Note - 56 Dividends
The following dividends were declared and paid by the Company during the year:
1. Cash and short-term deposits, trade receivables, loans, trade payables, and other current financial assets and liabilities approximate
their carrying amounts largely due to the short-term maturities of these instruments.
2. Other non-current receivables are evaluated by the Company, based on parameters such as interest rates, individual creditworthiness
of the counterparty etc. Based on this evaluation, allowances are considered to account for the expected losses of these receivables. As
at end of each reporting year, the carrying amounts of such receivables, net of allowances (if any), are not materially different from their
calculated fair values.
3. Fair value of Investments in quoted mutual funds and equity shares are based on quoted market price at the reporting date. The fair
value of unquoted Investments in preference shares are estimated by discounting future cash flows using rates currently available for
debt on similar terms, credit risk and remaining maturities. The fair value of unquoted Investments in equity shares are estimated on
net assets basis.
4. Fair value of borrowings from banks and other non-current financial liabilities, are estimated by discounting future cash flows using
rates currently available for debt on similar terms and remaining maturities.
5. The fair values of derivatives are calculated using the RBI reference rate as on the reporting date as well as other variable parameters.
Fair Value Hierarchy:
All financial assets and liabilities for which fair value is measured in the financial statements are categorised within the fair value
hierarchy, described as follows: -
There has been no transfer among levels 1, 2 and 3 during the year ended 31st March, 2026.
Note - 59
The fair value of Investment property as per registered valuer report as at 31st March, 2026 is '13.75 crores (Previous year: '13.75 crores) after
considering the rental income from current leases and other assumptions that market participants would use while pricing investment
property under current market conditions.
Note - 60
The Company holds more than 20% shareholding in certain companies, namely - Vaayu Renewable Energy (Godavari) Pvt. Ltd., Truere
Galaxy Pvt. Ltd., Solarithic Power SPV Pvt. Ltd., Truere UP 2 Pvt. Ltd., and STTY RE Limited. These investments have been made to qualify only
as a captive user of renewable power facilities operated by these companies and the Company has no role & responsibility in day-to-day
management and operations of the said companies. Accordingly, these entities have not been classified as Associates as per Ind AS 28, as the
Company does not exercise significant influence over their management or operational decision-making processes.
Note - 61 Financial Risk Management Objectives and Policies
The Company's activities are exposed to a variety of financial risks from its operations. The key financial risks include market risk (including
foreign currency risk, interest rate risk and commodity price risk), credit risk and liquidity risk.
• Market Risk: Market risk is the risk that the fair value of future cash flows of a financial instrument will fluctuate because of changes in
market prices. Market risk comprises mainly three types of risk: interest rate risk, currency risk and other price risk such as commodity
price risk.
- Foreign Currency Risk: Foreign Currency risk is the risk that the fair value or future cash flows of an exposure will fluctuate because
of changes in foreign exchange rates. The Company has obtained foreign currency borrowings and has foreign currency trade
payables and receivables and is therefore, exposed to foreign exchange risk.
After taking cognizance of the natural hedge, the Company takes appropriate hedges to mitigate its risk resulting from fluctuations in
foreign currency exchange rate(s).
Foreign Currency Sensitivity: The following table demonstrates the sensitivity to a reasonably possible change in USD with all other
variables held constant. The impact on Company's profit before tax is due to changes in the foreign exchange rate is as follows:
The assumed movement in basis points for the interest rate sensitivity analysis is based on the currently observable market environment.
- Commodity Price Risk: The Company is affected by the price volatility of certain commodities. Its operating activities require the
purchase of raw material and manufacturing of tyres, and therefore, requires a continuous supply of certain raw materials such as
natural rubber, synthetic rubber, carbon black, fabric, crude oil, bead wire rubber chemicals etc. To mitigate the commodity price
risk, the Company has an approved supplier base to get best competitive prices for the commodities and to assess the market to
manage the cost without any compromise on quality.
• Credit Risk: Credit risk is the risk that counterparty might not honor its obligations under a financial instrument or customer contract,
leading to a financial loss. The Company is exposed to credit risk from its operating activities (primarily trade receivables).
- Trade Receivables: Customer credit risk is managed based on Company's established policy, procedures and controls. The Company
assesses the credit quality of the counterparties taking into account their financial position, past experience and other factors.
Credit risk is reduced by receiving deposits, pre-payments and export letter of credit to the extent possible. The Company has a
well-defined sales policy to minimize its risk of credit defaults. Outstanding customer receivables are regularly monitored and assessed.
Impairment analysis is performed based on historical data at each reporting date on an individual basis. However, a large number of
minor receivables are grouped into homogenous groups and assessed for impairment collectively.
Credit Risk Exposure: The allowance for expected credit loss on customer balances for the year ended 31st March, 2026 and
31st March, 2025:
Forward Contracts for hedging Payables: '96.38 crores- US$ 10.18 Million (Previous year: '709.58 crores - US $ 82.91 Million) are
outstanding as at 31.03.2026. Option Contracts for hedging Payables: Nil (Previous year: '266.59 crores - US $ 31.15 Million).
Currency Swap for Long-term rupee loans: '47.16 crores - US $ 4.98 Million & '35.15 crores - EUR 3.22 Million (Previous year: '59.69 Crores
- US $ 6.98 Million & '37.22 Crores - EUR 4.03 Million).
Foreign currency exposure unhedged net payable is '951.29 crores - US $100.51 Million (Previous year: '328.63 crores - US $38.39
Million) as at 31.03.2026.
- Interest Rate Risk: Interest rate risk is the risk that the fair value of future cash flows of a financial instrument will fluctuate because
of changes in market interest rates. Any changes in the interest rates environment may impact future rates of borrowing. The
Company mitigates this risk by regularly assessing the market scenario, finding appropriate financial instruments, interest rate
negotiations with the lenders for ensuring the cost-effective method of financing.
Interest Rate Sensitivity: The following table demonstrates the sensitivity to a reasonably possible change in interest rates on financial
assets affected. With all other variables held constant, the Company's profit before tax is affected through the impact on finance cost
with respect to our borrowing, as follows:
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