1. GENERAL INFORMATION
Neelamalai Agro Industries Limited was incorporated on 21st April 1943 under the Indian Companies Act 1913. The Company is in Tea Plantation Business of cultivating Tea, its manufacturing and sale, both domestic and export. Its Registered Office is at 60, Rukmani Lakshmipathi Salai, Egmore, Chennai, Tamil Nadu 600 008.
The Company is listed on the Bombay Stock Exchange.
The standalone financial statements for the year ended March 31, 2026 were approved by the Board of Directors and authorised for issue on May 29, 2026.
2. BASIS OF PREPARATION
The financial statements of the Company have been prepared in accordance with Indian Accounting Standards (“Ind AS”) issued under Section 133 of the Companies Act, 2013 and notified by the Ministry of Corporate Affairs under the Companies (Indian Accounting Standards) Rules, 2015 (as amended) and guidelines issued by the Securities and Exchange Board of India (SEBI), under the historical cost convention on the accrual basis except for certain items which are measured at fair values.
The accounting policies as set out below have been applied consistently except where a newly issued accounting standard is initially adopted or a revision to an existing accounting standard requires a change in the accounting policy hitherto in use.
All assets and liabilities have been classified as current or non-current as per the company’s normal operating cycle and other criteria set out in Division II of the Schedule III to the Companies Act 2013. Based on the nature of products and services and the time between the acquisition of assets for processing and their realization in cash and cash equivalent, the Company has ascertained its operating cycle as 12 months for the purpose of current and non-current classification of assets and liabilities.
2.1 STATEMENT OF COMPLIANCE WITH IND AS
The Financial Statements comprising Balance Sheet, Statement of Profit and Loss, Statement of Changes in Equity, Statement of Cash Flow together with notes for the year ended March 31, 2026, have been prepared in accordance with Ind AS as notified above.
The Company has applied the following amendments to Indian Accounting Standards for the year ended 31 March 2026:
i. Ind AS 1 - Implementation ofAmendments to Ind AS 1 — Classification of Liabilities
The Company has adopted amendments to Ind AS 1 relating to classification of liabilities as current or non-current. Classification is based on the existence of a substantive right to defer settlement for at least twelve months as at the reporting date.
Only covenants required to be complied with on or before the reporting date affect classification; covenants applicable after the reporting date require disclosure only. A liability may continue to be classified as non-current where a waiver for breach of covenant is obtained after the reporting date but before approval of the financial statements, subject to the conditions of the amendment.
Conversion options are considered only where they are not classified as equity in accordance with Ind AS 32
ii. Ind AS 12 — Income Taxes (International Tax Reform — Pillar Two)
The Company has applied the mandatory temporary exception from recognition and disclosure of deferred tax assets and liabilities arising from the Pillar Two model rules introduced through amendments to Ind AS 12. The Company has assessed its exposure to Pillar Two income taxes and does not expect a material impact on its financial statements. The Company has complied with the disclosure requirements, to the extent applicable.
iii. Ind AS 7 — Supplier Finance Arrangements
The amendments require disclosures to enhance transparency of supplier finance arrangements and their effects on an entity’s liabilities, cash flows and exposure to liquidity risk. The Company does not have any supplier finance arrangements during the year.
iv. Ind AS 21 - Lack of Exchangeability
The amendments provide guidance on assessing when a currency is exchangeable into another currency and on determining the exchange rate when exchangeability is lacking. The Company has evaluated the impact of these amendments and concluded that they do not have a material impact on its financial statements.
Overall impact:
The adoption of the above amendments did not have a material impact on the Company’s financial statements for the current or prior periods.
New standards/amendments notified but not yet effective:
The Ministry of Corporate Affairs (MCA), vide notification dated 13 August 2025, has issued amendments to Ind AS 1 — Presentation ofFinancial Statements, relating to the classification ofliabilities as current or non-current. The amendments clarify that classification is based on rights that exist at the end of the reporting period, and that only covenants required to be complied with on or before the reporting date affect such classification.
These amendments are applicable for annual reporting periods beginning on or after 1 April 2026.
The Company has performed a preliminary assessment of its loan arrangements and does not expect these amendments to have a material impact on the classification of its financial liabilities.
2.2 CRITICAL JUDGEMENTS & ESTIMATES IN APPLYING ACCOUNTING POLICIES
The preparation of financial statements in conformity with Ind AS requires management to make judgments, estimates and assumptions that affect the application of accounting policies and the reported amounts of assets, liabilities, the disclosures of contingent assets and contingent liabilities at the date of financial statements, income and expenses during the period. Actual results may differ from these estimates. Estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognized in the period in which the estimates are revised and in future periods which are affected. Application of accounting policies that require critical accounting estimates and assumptions having the most significant effect on the amounts recognized in financial statements are as follows:
• Taxation:
Significant judgement is involved in determining the tax liability for the company which includes interpretation of tax legislation, developments in case law and the potential outcomes of tax audits and appeals which may be subject to significant uncertainty. Also, there are many transactions and calculation during the ordinary course of business for which the ultimate tax determination is uncertain. Therefore, the actual results may vary from expectations resulting in adjustments to provisions, the valuation of deferred tax assets, cash tax settlements and therefore the tax charge in the statement of profit or loss. Further judgement is involved in determining the deferred tax position on the balance sheet date.
• Defined benefit plans:
The cost of the defined benefit plans and the present value of the defined benefit obligation are based on actuarial valuation using the projected unit credit method. An actuarial valuation involves making various assumptions that may differ from actual developments in the future. These include the determination of the discount rate, future salary increases and mortality rates. Due to the complexities involved in the valuation and its long term nature, a defined benefit obligation is highly sensitive to changes in these assumptions. All assumptions are reviewed at each Balance Sheet date.
• Fair Value of financial instruments and biological assets:
The fair value of financial instruments that are unlisted and not traded in active market and biological assets (including agricultural produce) is determined at value assessed based on recent transaction entered into with third party or based on the valuation done by the external appraisers. Where it is not possible to determine a reliable estimate of fair value, the carrying value is determined based on acquisition cost.
2.3 Functional and Presentation Currency
Items included in financial statements of the Company are measured using the currency ofthe primary economic environment in which the Company operates (“the functional currency”). Indian rupee is the functional currency of the Company.
The Financial Statements are presented in Indian Rupees which is company’s presentation currency. All financial information presented in Indian Rupees has been rounded to the nearest Lakhs with two decimals except where otherwise indicated.
3 Summary of material accounting policies
3.1 PROPERTY, PLANT AND EQUIPMENT:
a. Recognition and Measurement
Property, plant and equipment are stated at cost less accumulated depreciation and accumulated impairment loss based on cost model. Cost comprises the purchase price and any attributable cost of bringing the asset to its working condition for its intended use. 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. Cost also includes taxes and duties for which credit is not available, freight and other direct or allocated expenses during construction period, net of any income earned.
Bearer Plants are recognised under property, plant & equipment on the fulfilment of the following conditions:
- It is used in the production or supply of the agricultural produce.
- Is expected to bear produce for more than one period; and has a remote likelihood of being sold as agricultural produce, except for incidental scrap sales.
Bearer plants are recognised at historical costs less depreciation. Cost oftea bushes includes expenditure incurred for planting and maintenance of the tea bushes, till the tea bushes reach commercial tea leaves bearing ability and the cost of the tea bushes/ seeds replanted. Based on the recommendation of the experts the non-bearing period of the tea bushes has been determined at 5 — 7 years from the year of planation of the tea bushes.
Replanted tea bushes are considered ready for their intended use from the beginning of the fifth - seventh financial year following the financial year in which the planting was undertaken. Depreciation of these assets, on the same basis as other property assets, commences when the assets are ready for their intended use. Costs of rejuvenation pruning are recognised in the statement of profit and loss in the period in which the costs are incurred.
Subsequent costs
Subsequent expenditure related to an item of property, plant and equipment is added to its book value only if it increases the future benefits from the existing asset beyond its previously assessed standard of performance. 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. All other repair and maintenance costs are recognised in statement of profit or loss as incurred.
An item of property, plant and equipment is derecognized upon disposal or when no future economic benefits are expected to arise from the continued use of the asset.
Advances paid towards the acquisition of property, plant and equipment outstanding at each Balance Sheet date is classified as capital advances under other non-current assets and the cost of assets not ready to use before such date are disclosed under ‘Capital work-in-progress’. The cost and related accumulated depreciation are eliminated from the financial statements upon sale / retirement or designation as assets held for sale, of the asset and the resultant gains or losses are recognized in the Statement of Profit and Loss.
b. Depreciation:
Tangible property, plant & equipment are depreciated on written down method adopting the useful life & residual value as specified in Schedule II of the Companies Act 2013, except in respect of Tea Bushes and Farm Field Equipment for which useful life has been determined based on technical evaluation by the management. In respect ofadditions to /deletions from the property, plant and equipment, depreciation is provided on pro-rata basis with reference to the month of addition/deletion of the Assets.
Useful life adopted based on technical evaluation are as under:
Class of property, plant and equipment Useful life
Tea Bushes 50 years
Farm Field Equipments 5 years
Depreciation methods, useful lives and residual values are reviewed periodically, including at each financial year end.
3.2 INTANGIBLE ASSET
Intangible assets that are acquired by the company, which have finite useful lives are measured at cost less accumulated amortization and accumulated impairment losses. Cost includes expenditure that is directly attributable to the acquisition of the intangible asset.
Research costs are expensed as incurred. Development expenditures on an individual project are recognised as an intangible asset when the Company can demonstrate.
• The technical feasibility of completing the intangible asset so that the asset will be available for use or sale.
• Its intention to complete and its ability and intention to use or sell the asset.
• How the asset will generate future economic benefits
• The availability of resources to complete the asset
• The ability to measure reliably the expenditure during development Subsequent expenditure
Subsequent expenditure is capitalized only when it increases the future economic benefits embodied in the specific asset to which it relates. All other expenditure, including expenditure on internally generated goodwill and brands, are recognized in the statement of profit and loss.
Amortization of intangible asset with finite useful lives
Amortization is recognized in the statement of profit and loss on a straight line basis over the estimated useful lives of intangible assets from the date that they are available to use based on the estimates made by the management w.r.t the useful life and residual value.
Estimated useful life:
a) Software is amortised over 8 years
Amortization methods, useful lives and residual values are reviewed at each reporting date and adjusted prospectively, if appropriate.
3.3 INVENTORIES
Inventories are valued as under:
a. Raw materials, Packing materials, Stores & Spares:
Valued at lower of cost or net realizable value and for this purpose cost is determined on weighted average basis .The aforesaid items are valued below cost if the finished products in which they are to be incorporated are expected to be sold at a loss.
b. Finished Goods
Valued at lower of cost or net realizable value and for this purpose cost is determined on weighted average basis.
Cost includes direct material cost, direct labour cost, taxes and duties for which credit is not available, freight, other direct expenses and an appropriate proportion of variable and fixed overhead expenditure.
Finished goods comprising agricultural produce that the Company has harvested from its biological assets are measured on initial recognition at their fair value less costs to sell at the point of harvest.
Net realisable value is the estimated selling price in the ordinary course of business less the estimated costs of completion and the estimated costs necessary to make the sale.
Cost of the purchased inventory are determined after deducting rebates and discounts. Provision is made for obsolete, non-moving & defective stocks, wherever necessary.
3.4 Employee benefits - Retirement benefit costs and termination benefits
i. Defined Contribution Plans
Payment to defined contribution retirement benefit plans i.e. Provident Fund & Superannuation Schemes are recognised as an expense in the statement of profit and loss when employees have rendered service entitling them to the contributions. The Superannuation scheme are funded with an insurance Company in the form of a qualifying insurance policy.
ii. Defined Benefit Plans
The Company has a defined benefit gratuity plan. Every employee who has completed five years or more of service gets a gratuity on post-employment at 15 days salary (last drawn salary) for each completed year of service as per the rules of the Company. The aforesaid liability is provided for on the basis of an actuarial valuation on projected unit credit method made at the end of the financial year. The scheme is funded with an insurance Company in the form of a qualifying insurance policy.
Remeasurement, comprising actuarial gains and losses and the return on plan assets (excluding net interest), is reflected immediately in the balance sheet with a charge or credit recognised in other comprehensive income in the period in which they occur. Remeasurement recognised in other comprehensive income is reflected immediately in retained earnings and is not reclassified to profit or loss. Past service cost is recognised in profit or loss in the period of a plan amendment. Net interest is calculated by applying the discount rate at the beginning of the period to the net defined benefit liability or asset. Defined benefit cost are categorised as follows:
Ý Service cost (including current service cost, as well as gains and losses on curtailments and settlement)
Ý Net interest expense or income
Ý Remeasurement
The company presents the first two components of defined benefit cost in profit or loss in the line item ‘employee benefit expense’. Curtailment gains or losses are accounted for as past service cost.
The retirement benefit obligation recognised in the balance sheet represents the actual deficit or surplus in the company’s defined benefit plans. Any surplus resulting from this calculation is limited to the present value of any economic benefits available in the form of refunds from the plans or reductions in future contributions to the plans.
iii. Compensated Absences
The Company has a scheme for compensated absences for employees which is a long-term employee benefit, the liability for which is determined on the basis of an independent actuarial valuation using the projected unit credit method, carried out at the Balance Sheet date.
iv. Short term benefits
The costs of all short-term employee 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 during the period in which the employee renders the related services. The accruals for employee entitlements of benefits such as salaries, bonuses and annual leave represent the amount which the Company has a present obligation to pay as a result of the employees’ services and the obligation can be measured reliably. The accruals have been calculated at undiscounted amounts based on current salary levels at the Balance Sheet date.
3.5 Financial Instruments I. Financial Assets
a) Initial Recognition and Measurement
All financial assets are initially recognized at fair value except trade receivables which do not contain a significant financing component are measured at transaction price according to Ind AS 115. Transaction costs that are directly attributable to the acquisition or issue of financial assets, which are at fair value are adjusted through profit or loss. Purchase and sale of financial assets are recognised using trade date accounting.
b) Subsequent Measurement
i) Financial assets carried at amortised cost (AC)
A financial asset is measured at amortised cost if it is held within a business model whose objective is to hold the asset 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 amount outstanding.
ii) Financial assets at fair value through other comprehensive income (FVTOCI)
For equity investments which are not held for trading purposes and where the company has exercised the option to classify the investment as FVTOCI, all fair value changes on the investment are recognized in OCI. The accumulated gains or losses on such investments are not recycled to the Statement of Profit and Loss even on sale ofsuch investment.
iii) Financial assets at fair value through profit or loss (FVTPL)
A financial asset which is not classified in any of the above categories are measured at FVTPL.
iv) Investments in associates and joint venture
Investment in associate companies and joint venture is carried at cost in the separate financial statements.
c) Impairment offinancial assets
The Company assesses at each balance sheet date whether there is objective evidence that a financial asset or a group of financial assets is impaired. A financial asset or a group offinancial assets is impaired and impairment losses are incurred only ifthere is objective evidence of impairment as a result of one or more events that occurred after the initial recognition ofthe asset (a ‘loss event’) and that loss event (or events) has an impact on the estimated future cash flows of the financial asset or group of financial assets that can be reliably estimated.
In accordance with Ind-AS 109, the Company follows ‘simplified approach’ for recognition ofimpairment loss allowance on trade receivables which do not contain a significant financing component.
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 Balance Sheet date, right from its initial recognition.
d) Derecognition 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:
- 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 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.
e) Equity instruments
An equity instrument is any contract that evidences a residual interest in the assets of an entity after deducting all of its liabilities. Equity instruments issued by the Company are recognized at the proceeds received, net of direct issue costs. Repurchase of the Company’s own equity instruments is recognized and deducted directly in equity. No gain or loss is recognized in Statement of Profit and Loss on the purchase, sale, issue or cancellation of the Company’s own equity instruments.
3.6 Foreign currency Initial Recognition
On initial recognition, all foreign currency transactions are recorded by applying to the foreign currency amount the exchange rate between the reporting currency and the foreign currency at the date of the transaction.
Subsequent Recognition
As at the reporting date, non-monetary items which are carried at historical cost and denominated in a foreign currency are reported using the exchange rate at the date of the transaction. All non-monetary items which are carried at fair value or other similar valuation denominated in a foreign currency are reported using the exchange rates that existed when the values were fair value measured.
Monetary items denominated in foreign currency and outstanding at the Balance Sheet date are converted at the year-end exchange rates and the resultant loss or gain, is recognised as income or expense in the statement of the profit and loss.
3.7 Fair value measurement
The Company measures financial instruments, such as, investments or derivatives at fair value at each balance sheet date on a portfolio basis.
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:
- In the principal market for the asset or liability, or
- In the absence of a principal market, in the most advantageous market for the asset or liability The principal or the most advantageous market must be accessible by the Company.
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 economic best interest.
A fair value measurement of a non-financial asset takes into account a market participant’s ability to generate economic benefits by using the asset in its highest and best use or by selling it to another market participant that would use the asset in its highest and best use.
The Company uses valuation techniques that are appropriate in the circumstances and for which sufficient data are available to measure fair value, maximizing the use of relevant observable inputs and minimizing the use of unobservable inputs.
All assets and liabilities for which fair value is measured or disclosed in the standalone financial statements are categorised 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 recognised in the standalone financial statements on a recurring basis, the Company determines whether transfers have occurred between levels in the hierarchy by re-assessing categorisation (based on the lowest level input that is significant to the fair value measurement as a whole) at the end of each reporting period.
For the purpose of fair value disclosures, the Company has determined classes of assets and liabilities on the basis of the nature, characteristics and risks of the asset or liability and the level of the fair value hierarchy as explained above.
This note summaries accounting policy for fair value. Other fair value related disclosures are given in the relevant notes.
- Quantitative disclosures of fair value measurement hierarchy
- Financial instruments (including those carried at amortised cost)
3.8 Revenue recognition:
Revenue is recognised on their accrual and when no significant uncertainty on measurability or collectability exists. Expenditure is accounted for on their accrual.
Sale of Goods:
Revenue from the sale of goods is recognised when the performance obligations towards customers have been met at an amount that reflects the consideration to which the company believes it is entitled to in exchange for the transfer of goods to customers i.e. Transaction price, net ofany sales returns and GST. Performance obligations are deemed to have been met when the control of goods has been transferred to the customer, depending on the individual terms of the contract of sale. Considering the general terms of sales of goods, there is no significant financing element included in the sales consideration.
3.9 Finance Income and expense
Finance income comprises of interest income on funds invested, dividend income and fair value gains on financial assets at fair value through profit or loss. Interest income is recognized using effective interest method. Dividend income is recognized in statement of profit and loss on date when the company’s right to receive payment is established, which in the case of quoted securities is the ex-dividend date.
Finance expense comprises of interest expense on loans and borrowings recognised using effective interest method, unwinding of discount on provision and fair value losses on financial asset through FVTPL that are recognized in the statement of profit and loss.
3.10 Taxation
Income tax expense comprises current tax expense and the net change in the deferred tax asset or liability during the year. Current and deferred tax are recognised in profit or loss, except when they relate to items that are recognised in other comprehensive income or directly in equity, in which case, the current and deferred tax are also recognised in other comprehensive income or directly in equity, respectively.
(i) Current tax:
Current Tax expenses are accounted in the same period to which the revenue and expenses relate. Provision for current income tax is made for the tax liability payable on taxable income after considering tax allowances, deductions and exemptions determined in accordance with the applicable tax rates and the prevailing tax laws.
Current tax assets and current tax liabilities are offset when there is a legally enforceable right to set off the recognised amounts and there is an intention to settle the asset and the liability on a net basis.
(ii) Deferred tax:
Deferred income tax is recognised using the balance sheet approach. Deferred income tax assets and liabilities are recognised for deductible and taxable temporary differences arising between the tax base of assets and liabilities and their carrying amount in financial statements, except when the deferred Income tax arises from the initial recognition of goodwill, an asset or liability in a transaction that is not a business combination and affects neither accounting nor taxable profits or loss at the time of the transaction.
Deferred income 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. Deferred tax liabilities are generally recognized for all taxable temporary differences.
The carrying amount of deferred tax assets is reviewed at each Balance Sheet date and reduced to the extent that it is no longer probable that sufficient taxable profits will be available to allow all or part of the deferred income tax asset to be utilised.
Deferred tax liabilities and assets are measured at the tax rates that are expected to apply in the period in which the liability is settled or the asset realized, based on tax rates (and tax laws) that have been enacted or substantively enacted by the Balance Sheet date.
Deferred tax assets and liabilities are offset when there is a legally enforceable right to set off current tax assets against current tax liabilities and when they relate to income taxes levied by the same taxation authority and the Company intends to settle its current tax assets and liabilities on a net basis.
Minimum Alternative Tax
Minimum Alternative Tax (“MAT”) credit is recognized as an asset only when and to the extent there is reasonable certainty that the Company will pay normal income tax during the specified period in which such credit can be set off under the income tax law. Such asset is reviewed at each Balance Sheet date and the carrying amount of the MAT credit asset is written down to the extent there is no longer a reasonable certainty to the effect that the Company will pay normal income tax during the specified period.
3.11 Cash flow statement:
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 ofpast 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.
3.12 Dividends:
Final Dividends on shares are recorded as a liability on the date of approval by the shareholders and interim dividends are recorded as liability on the date of declaration by the Company’s Board of Directors.
3.13 Segment Reporting:
The Company identifies operating segments based on the internal reporting provided to the chiefoperating decision-maker. The chief operating decision-maker, who is responsible for allocating resources and assessing performance of the operating segments, has been identified as the Board of Directors that makes strategic decisions.
The accounting policies adopted for segment reporting are in line with the accounting policies of the Company. Segment revenue, segment expenses, segment assets and segment liabilities have been identified to segments on the basis of their relationship to the operating activities of the segment. The Company operates in a single Business segment namely Cultivation, Manufacturing and Marketing of Tea. Accordingly, this is the only business segment to be reported and geographically segment is considered as India and rest of the world.
|