2. Material Significant Policies
2.1 Statement of Compliance
These financial statements are Standalone Financial Statement of the Company that have been
prepared in accordance with Indian Accounting Standards (Ind AS) notified under the
Companies (Indian Accounting Standards) Rules,2015 (as amended) together with the
comparative period data as at and for the year ended March 31, 2025 and the relevant provisions
of Divisions II of Schedule III to the Companies Act,2013 (“the Act”) and guidelines issued by
the Securities and Exchange Board of India (SEBI), as applicable.
2.2 Basis of Preparation and Presentation
The standalone financial statements have been prepared on the historical cost convention and on
an accrual basis, except for:
(i) certain financial instruments that are measured at fair values at the end of each reporting
period;
(ii) Defined benefit plans - plan assets that are measured at fair values at the end of each
reporting period, as explained in the accounting policies below:
Historical cost is generally based on the fair value of the consideration given in exchange for
goods and services
The standalone financial statements are presented in Indian Rupees (?) and all values are rounded
to the nearest Lakhs (? 00,000) upto Two decimal, except when otherwise indicated.
All the Assets & Liabilities have been classified as current or non-current as per the Company’s
normal operating cycle and other criteria as set out in Ind AS and Schedule III to the said Act.
a. Classification of Current and Non-current
An asset is treated as current when it is:
i) Expected to be realized or intended to be sold or consumed in normal operating cycle and
company has identified twelve months as its normal operating cycle based on the time between
the acquisition of assets for processing and their realization in cash and cash equivalents.
ii) Held primarily for the purpose of trading,
iii) Expected to be realized within twelve months after the reporting period, or
iv) 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 current when:
i) It is expected to be settled in normal operating cycle,
ii) It is held primarily for the purpose of trading,
iii) It is due to be settled within twelve months after the reporting period, or
iv) There is no unconditional right to determine the settlement of the liability for at least twelve
months after the reporting period.
The Company classifies all other liabilities as non - current.
b. Foreign Currency Transactions
On initial recognition, transactions in currencies other than the Company's functional
currency(INR) are translated at exchange rates on the date of the transactions. Monetary assets
and liabilities denominated in foreign currencies at the reporting date are translated into the
functional currency at the exchange rate on that date. Exchange differences arising on the
settlement of monetary items or on translating monetary items at rates different from those at
which they were translated on initial recognition during the year or in previous period are
recognized in profit or loss in the period in which they arise.
c. Segment reporting
The Company operates in a Single segment of manufacturing of broad range of finished
pharmaceutical formulations in a dosage form viz. Tablets, Capsules, Syrup, Dry Syrup,
Injections etc. The product has the same risks and returns, which are predominantly governed by
market conditions, namely demand and supply position. Thus, in the context of Ind AS 108
“Operating Segment”, issued by the Institute of Chartered Accountants of India, there is only
one identified reportable segment.
d. Property, Plant and Equipment
Property, plant and equipment are stated at cost of acquisition or construction less accumulated
depreciation/amortization and impairment losses, if any. The cost comprises of the purchase
price (net of GST credit wherever applicable) and any attributable cost of bringing the property,
plant and equipment to its working condition for its intended use.
Subsequent expenditures related to an item of property, plant, and equipment are added to its
gross book value only if it increases the future benefits from the existing asset beyond its
previously assessed standard of performance.
The Company identifies and determines separate useful life for each major component of
property, plant and equipment, if they have useful life that is materially different from that of the
remaining asset.
Items such as Laboratory items is recognized in accordance with Ind AS 16 “Property, Plant and
Equipment” when they meet the definition of property, plant and equipment. Otherwise, such
items are classified as Consumable expense or Inventories as per the nature of item.
Property, plant and equipment not ready for the intended use on the date of Balance Sheet are
disclosed as “Capital work-in-progress”. Advances given towards acquisition of property, plant
and equipment’s outstanding at each Balance Sheet date are disclosed as Capital Advances under
“Other Non-Current Assets”.
Losses arising from the retirement of, and gains and losses arising from disposal of property,
plant and equipment are measured as the difference between the net disposal proceeds and the
carrying amount of the property, plant and equipment and are recognized in the statement of
profit and loss when the property, plant and equipment is derecognized.
The residual values, useful lives and methods of depreciation of property, plant and equipment
are reviewed at each financial year end and adjusted prospectively, if appropriate.
e. Intangible asset:
Intangible assets are identifiable non-monetary assets without physical substance, such as
software, licenses, trademarks, and similar rights. An intangible asset is recognised only when it
is identifiable, the Company has control over the asset, it is probable that future economic
benefits will flow to the Company, and the cost of the asset can be measured reliably.
Intangible assets are initially measured at cost, which includes the purchase price and any directly
attributable costs necessary to make the asset ready for its intended use. After initial recognition,
intangible assets with finite useful lives are amortised on a straight-line basis over their estimated
useful life. The Company generally assumes a nil residual value unless otherwise assessed. The
amortisation method and the useful life are reviewed annually, and any changes are accounted
for prospectively.
f. Depreciation &Amortization on Fixed asset:
Depreciation on fixed assets is calculated on written down value basis using the rates arrived at
based on the useful life of the assets prescribed under Schedule II of the Companies Act, 2013
for the year ended on March 31, 2025.
The useful life of Property, Plant and Equipment as estimated by the Management on the basis
of expert advice and past experience are as under:
During the year ended March 31, 2025, the Company acquired an Intangible asset Technical know
how. The asset is being amortised over an estimated useful life of 10 years on a straight-line
basis, starting from the date it was available for use
g. Investment in nature of equity in subsidiaries
The Company has elected to recognize its investments in equity instruments in subsidiaries at a
cost in the standalone financial statements.
The Company records the Investment in equity instrument of Subsidiary at cost less accumulated
impairment losses, if any. Where an indication of impairment exists, the carrying amount of the
investment is assessed and written down immediately to its recoverable amount. On disposal of
investment in the subsidiary, the difference between net disposal proceeds and the carrying
amounts are recognized in the standalone statement of profit and loss.
h. Inventories
Inventories are stated at cost or net realizable value whichever is lower. Cost include purchase
price, non-refundable taxes and delivery and handling cost and all costs incurred in bringing the
inventory to its present location and condition. Cost of raw materials, process chemicals, stores
and spares, packing material, and another inventory is determined on weighted average basis.
Finished goods stock is valued at cost or net realizable value whichever is lower. Cost of finished
goods comprises direct materials, direct labour and an appropriate proportion of variable and
fixed overhead expenditure, the latter being allocated on the basis of normal operating capacity.
Net realizable value is the estimated selling price in the ordinary course of business, less the
estimated costs of completion and costs necessary to make the sale.
The factors that the Company considers in determining the allowance for slow-moving, obsolete,
and other non-saleable inventory include estimated shelf life, planned product discontinuances,
price changes, ageing of inventory, and introduction of competitive new products, to the extent
each of these factors impacts the Company’s business and markets. The Company considers all
these factors and adjusts the inventory provision to reflect its actual experience periodically.
i. Statement of Cash Flows
Standalone Statement of Cash flows are reported using the indirect method, whereby profit
before tax is adjusted for the effects of transactions of a non-cash nature, any deferrals or accruals
of past or future operating cash receipts or payments and item of income or expenses associated
with investing or financing cash flows. The cash flows are segregated into operating, investing
and financing activities.
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