1. MATERIAL ACCOUNTING POLICIES
1.1 Statement of Compliance
These Standalone financial statements have been
prepared in accordance with the Indian Accounting
Standards (referred to as Ind AS) as prescribed under
section 133 of the Companies Act, 2013 read with
companies (Indian Accounting Standards) Rules as
amended from time to time.
These financial statements of the Company were
approved by the Board of Directors of the Company in
its meeting held on 8th May, 2025.
1.2 Basis of Preparation
The Standalone financial statements of the Company
are consistently prepared and presented under
historical cost convention on an accrual basis in
accordance with Ind AS except for certain financial
assets and liabilities that are measured at fair values.
The Company’s functional currency and presentation
currency is Indian National Rupees ('). All amounts
disclosed in the Standalone financial statements and
notes have been rounded off to the nearest Lakhs,
except otherwise indicated.
The Company presents its assets and liabilities in
the Balance Sheet based on current/non-current
classification.
An asset is treated as current when it is:
a) expected to be realized or intended to be sold or
consumed in normal operating cycle;
b) held primarily for the purpose of trading;
c) expected to be realized within twelve months
after the reporting period; or
d) cash or cash equivalent unless restricted from
being exchanged or used to settle a liability for at
least twelve months after the reporting period.
All other assets are classified as non-current.
A liability is treated as current when it is:
a) expected to be settled in normal operating cycle;
b) held primarily for the purpose of trading;
c) due to be settled within twelve months after the
reporting period; or
d) there is no unconditional right to defer the
settlement of the liability for at least twelve
months after the reporting period.
All other liabilities are classified as non-current.
Based on the nature of products and the time between
the acquisition of assets for processing and their
realization in cash and cash equivalents, the Company
has ascertained its operating cycle being a period
within twelve months for the purpose of current and
non-current classification of assets and liabilities. The
statement of cash flows has been prepared under
indirect method.
1.3 Use of judgments, estimates and assumptions
The preparation of the Company’s Standalone financial
statements required management to make judgments,
estimates and assumptions that affect the reported
amount of revenues, expenses, assets & liabilities and
the accompanying disclosures and the disclosures
of contingent liabilities. Uncertainty about these
assumptions and estimates could result in outcomes
that require a material adjustment in the future periods
in the carrying amount of assets or liabilities affected.
In accounting policies, management has made
judgments in respect of evaluation of recoverability
of deferred tax assets, which has the most significant
effect on the amounts recognized in the Standalone
financial statements.
The following are the key assumptions concerning the
future and other key sources of estimation uncertainty
at the end of the reporting period that may have a
significant risk of causing a material adjustment to the
carrying amounts of assets and liabilities within:
a) Useful life of property, plant & equipment and
intangible assets: The Company has estimated
useful life of the property, plant & equipment
as specified in Schedule II to the Companies
Act, 2013 or such other modified useful life as
disclosed in para 1.4. However the actual useful
life for individual equipments could turn out to
be different, there could be technology changes,
breakdown, and unexpected failure leading to
impairment or complete discard. Alternately,
the equipment may continue to provide useful
service well beyond the useful life assumed.
b) Lease: The Company evaluates if an arrangement
qualifies to be a lease as per the requirement
of Ind AS 116. Identification of a lease requires
significant judgment. The Company uses
significant judgment in assessing the lease
term (including anticipated renewals) and the
applicable discount rate.
The Company determines the lease term as the
non-cancelable period of lease, together with
both periods covered by an option to extend the
lease if the Company is reasonably certain to
exercise that option and periods covered by an
option to terminate the lease if the Company is
reasonably certain not to exercise that option. In
excersing whether the Company is reasonably
certain to excercise an option to extend a lease
or to exercise an option to terminate the lease, it
considers all relevant facts and circumstances
that create economic incentive for the Company
to exercise the option to extend the lease or to
exercise the option to terminate the lease. The
Company revises lease term, if there is change in
non-cancelable period of lease. The discount rate
used is generally based on incremental borrowing
rate.
c) Fair value measurement of financial instruments:
When the fair value of financial assets and
financial liabilities cannot be measured based on
quoted process in active market, the fair value is
measured using valuation techniques including
book value and the Discounted Cash Flow (DCF)
model. The inputs to these models are taken
from observable markets where possible, but
where this is not possible, a degree of judgment
is required in establishing fair values.
d) Taxes: Taxes have been paid/ provided,
exemptions availed, allowances considered etc.
are based on the extant laws and the Company’s
interpretation of the same based on the legal
advice received wherever required. These
could differ in the view taken by the authorities,
clarifications issued subsequently by the
government and courts, amendments to statutes
by the government etc.
e) Defined benefit plans: The cost of defined
benefit plans and other post-employment benefit
plans and the present value of such obligations
are determined using actuarial valuations. An
actuarial valuation involves making various
assumptions that may differ from actual
developments in the future.
f) Provisions: The Company makes provisions
for leave encashment and gratuity based on
report received from the independent actuary.
These valuation reports use complex valuation
models using not only the inputs provided by
the Company but also various other economic
variables. Considerable judgment is involved in
the process.
g) Contingencies: A provision is recognized when
an enterprise has a present obligation as a result
of past event and it is probable that an outflow of
resources will be required to settle the obligation in
respect of which a reliable estimate can be made.
Provisions are measured at the present value of
management’s best estimate of the expenditure
required to settle the present obligations at the
end of the reporting period. However, the actual
liability could be considerably different.
1.4 Property, Plant and Equipment
Freehold land is carried at historical cost. All other
property, plant and equipment are stated at cost, net
of recoverable taxes, trade discounts and rebates less
accumulated depreciation and impairment loss, if any.
The cost of tangible assets comprises its purchase
price, borrowing cost, any costs directly attributable
to bringing the asset into the location and condition
necessary for it to be capable of operating in the
manner intended by management, initial estimation of
any decommissioning obligations and finance cost.
When significant parts of the property, plant and
equipment are required to be replaced at intervals,
the Company derecognizes the replaced part and
recognizes the new part with its own associated
useful life and depreciated accordingly. Likewise, when
a major inspection is performed, its cost is recognized
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 recognized in
the Statement of Profit and Loss as incurred.
Cost of software directly identified with hardware is
recognized along with the cost of hardware.
Stores and spares which meet the definition of
property, plant and equipment and satisfy recognition
criteria of Ind AS 16 are capitalized as property, plant
and equipment.
An item of property, plant and equipment and any
significant part initially recognized is derecognized
upon disposal or when no future economic benefits are
expected from its use. Any gain or loss arising on de¬
recognition of the asset is included in the Statement of
Profit and Loss when the asset is derecognized.
Capital work-in-progress includes cost of property,
plant and equipment which are not ready for their
intended use.
The residual values and useful lives of property, plant
and equipment are reviewed at each financial year end
and changes, if any, are accounted prospectively.
Depreciation on the property, plant and equipment is
provided over the useful life of assets as specified in
Schedule II to the Companies Act, 2013 using straight
line method. Property, plant and equipment which are
added/disposed of during the year, depreciation is
provided on pro rata basis with reference to the month
of addition/deletion.
1.5 Intangible Assets
Intangible assets are recognized only if they are
separately identifiable and the Company expects to
receive future economic benefits arising out of them.
Intangible assets are stated at cost of acquisition net
of recoverable taxes less accumulated amortization/
depletion and impairment loss, if any. The cost
comprises purchase price, borrowing costs and any
cost directly attributable to bringing the asset to its
working condition for the intended use.
Computer Software is amortized over a period of three
years.
Intangible assets with finite lives are amortized on
straight line basis over their useful economic life
and assessed for impairment whenever there is an
indication that the intangible asset may be impaired.
The amortization period and the amortization method
for an intangible asset with a finite useful life are
reviewed at each year end. The amortized expense
on intangible assets with infinite lives and impairment
loss is recognized in the Statement of Profit and Loss.
The useful lives of intangible assets are assessed as
either finite or indefinite.
Gains or losses arising from de-recognition of an
intangible asset are recognized in the Statement of
Profit and Loss when the asset is derecognized.
Intangible assets with indefinite useful lives are not
amortized but are tested for impairment annually.
The assessment of indefinite life is reviewed annually
to determine whether the indefinite life continues to
be supportable. If not, the change in useful life from
indefinite to finite is made on a prospective basis. The
impairment loss on intangible assets with indefinite
life is recognized in the Statement of Profit and Loss.
1.6 Impairment of non-financial assets
At each Balance Sheet date, the Company assesses
whether there is an indication that an asset may
be impaired and also whether there is an indication
of reversal of impairment loss recognized in the
previous periods. If any indication exists or when
annual impairment testing for an asset is required,
the Company determines the recoverable amount
and impairment loss is recognized when the carrying
amount of an asset exceeds its recoverable amount.
An asset’s recoverable amount is the higher of an
asset or Cash-Generating Unit’s (CGU) fair value less
costs of disposal and its value in use. 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.
When 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.
I n assessing the 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.
1.7 Investment in Subsidiaries, Associates and joint
Ventures
Investment in subsidiaries, associates and joint
ventures are carried at cost less impairment losses,
if any. When an indication of impairment exists, the
carrying amount of the investment is assessed and
written down to its recoverable amount. On disposal of
investment in subsidiary, associates and joint ventures,
the difference between net disposal proceeds and the
carrying amount are recognized in statement of Profit
& loss.
Investment in Equity Instruments
All investment in equity instrument classified under
financial assets are initially measured at fair value. The
Company may on initial application irrevocably elect to
measure the same either at FVOCI or FVTPL.
The Company makes such election on an instrument
by instrument basis. Fair value change on an equity
instrument is recognized as 'other income’ in statement
of profit & Loss unless the Company has elected to
measure such instrument at FVOCI. Fair value changes
excluding dividend on an equity instrument measured
at FVOCI are recognized in OCI. Amount recognized
in OCI are not subsequently reclassified to statement
of Profit & loss. Dividend income on investment in
equity instrument are recognized as 'Other Income’ in
statement of Profit & Loss.
1.8 Non-current Assets held for Sale
Non-current assets classified as held for sale are
measured at the lower of carrying amount and fair
value less costs to sell.
Non-current assets are classified as held for sale if
their carrying amounts will be recovered through a
sale transaction rather than through continuing use.
This condition is regarded as met only when the
sale is highly probable and the asset is available for
immediate sale in its present condition subject only to
terms that are usual and customary for sales of such
assets.
Property, plant and equipment and intangible assets
are not depreciated or amortized once classified as
held for sale.
1.9 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
(i) Classification:
The Company classifies financial assets as
subsequently measured at amortized cost, fair
value through other comprehensive income, or
fair value through profit and loss on the basis of its
business model for managing the financial asset
and the contractual cash flow characteristics of
the financial asset.
(ii) Initial recognition and measurement:
All financial assets are recognized initially at fair
value plus, in the case of financial assets not
recognized at fair value through profit and loss,
transaction costs that are attributable to the
acquisition of the financial asset.
(iii) Financial assets measured at amortized cost:
Financial assets are subsequently measured at
amortized cost using Effective Interest Rate (EIR)
method, if these financial assets are held within a
business whose objective is to hold these assets
in order to collect contractual cash flows and
the contractual terms of the financial asset give
rise on specified dates to cash flows that are
solely payments of principal and interest on the
principal outstanding. The losses arising from
the impairment are recognized in the Statement
of Profit and Loss.
(iv) Financial assets at fair value through other
comprehensive income:
Financial assets are measured at fair value
through other comprehensive income if these
financial assets are held within a business
whose objective is achieved by both collecting
contractual cash flows and selling financial
assets and the contractual terms give rise to
cash flows that are solely payments of principal
and interest on the principal outstanding.
(v) Financial assets measured at fair value through
profit and loss:
Financial assets under this category are measured
initially as well as at each reporting date at fair
value. Fair value movements are recognized in
profit and loss.
(vi) De-recognition of financial assets:
A financial asset is primarily derecognized when
the rights to receive cash flows from the asset
have expired or the Company has transferred its
rights to receive cash flows from the asset.
AA. 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.
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 recognizes impairment loss
allowance based on lifetime ECLs at each reporting
date, right from its initial recognition.
B. Financial Liabilities
(i) Classification:
The Company classifies all financial liabilities as
subsequently measured at amortized cost, except
for financial liabilities at fair value through profit
and loss. Such liabilities, including derivatives that
are liabilities, shall be subsequently measured at
fair value.
(ii) Initial recognition and measurement:
All financial liabilities are recognized initially at
fair value, in the case of loans, borrowings and
payables, net of directly attributable transaction
costs. Financial liabilities include trade and other
payables, loans and borrowings including bank
overdrafts and derivative financial instruments.
(iii) Subsequent measurement:
All financial liabilities are re-measured at fair
value through statement of profit and loss include
financial liabilities held for trading and financial
liabilities designated upon initial recognition
as at fair value through 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.
(iv) Loans and borrowings:
Interest bearing loans and borrowings are
subsequently measured at amortized cost using
effective interest rate (EIR) method. Gains and
losses are recognized in Statement of Profit and
Loss when the liabilities are derecognized as well
as through EIR amortization process. The EIR
amortization is included as finance cost in the
Statement of Profit and Loss.
(v) De-recognition of financial liabilities:
A financial liability is derecognized when the
obligation under the liability is discharged or
canceled or expires. When an existing financial
liability is replaced by another from the same
lender on substantially different terms, or the
terms of an existing liability are substantially
modified, such an exchange or modification
is treated as the de-recognition of the original
liability and the recognition of a new liability. The
difference in the respective carrying amounts is
recognized in the Statement of Profit and Loss.
(vi) Derivative financial instruments:
The Company uses derivative financial
instruments such as forward currency contracts
and options to hedge its foreign currency risks.
Such derivative financial instruments are initially
recognized at fair value on the date on which
a derivative contract is entered into and are
subsequently re-measured at fair value. The gain
or loss in the fair values is taken to Statement of
Profit and Loss at the end of every period. Profit
or loss on cancellations/renewals of forward
contracts and options are recognized as income
or expense during the period.
C. Offsetting of financial instruments
Financial assets and financial liabilities are offset
and the net amount is reported in the Balance Sheet
if there is a currently enforceable legal right to offset
the recognized amounts and there is an intention to
settle on a net basis to realize the assets and settle the
liabilities simultaneously.
1.10 Fair value measurement
The Company measures certain financial assets and
financial liabilities including derivatives and defined
benefit plans at fair value.
Fair value is the price that would be received to sell
an asset or paid to transfer a liability in an orderly
transaction between market participants at the
measurement date. The fair value measurement is
based on the presumption that the transaction to sell
the asset or transfer the liability takes place either:
a) In the principal market for the asset or liability; or
b) In the absence of a principal market, in the most
advantageous market for the asset or liability
The fair value of an asset or a liability is measured
using the assumptions that market participants would
use when pricing the asset or liability, assuming that
market participants act in their best economic interest.
All assets and liabilities for which fair value is measured
or disclosed in the Standalone financial statements are
categorized within the fair value hierarchy, described
as follows, based on the lowest level input that is
significant to the fair value measurement as a whole:
Level 1- Quoted (unadjusted) market prices in active
markets for identical assets or liabilities.
Level 2- Valuation techniques for which the lowest level
input that is significant to the fair value measurement
is directly or indirectly observable.
Level 3- Valuation techniques for which the lowest level
input that is significant to the fair value measurement
is unobservable.
For assets and liabilities that are recognized in the
standalone financial statements on a recurring
basis, the Company determines whether transfers
have occurred between levels in the hierarchy by re¬
assessing categorization (based on the lowest level
input that is significant to the fair value measurement
as a whole) at the end of each reporting period.
l.H Borrowing cost
Borrowing costs directly attributable to the acquisition,
construction or production of an asset are capitalized
as part of the cost of the asset. All other borrowing
costs are expensed in the period in which they occur.
Borrowing costs consist of interest and other costs
that an entity incurs in connection with the borrowing
of funds. Borrowing cost also includes exchange
differences to the extent regarded as an adjustment to
the borrowing costs.
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