2 SUMMARY OF MATERIAL ACCOUNTING
POLICIES
This note provides a list of the Material accounting policies
adopted in the preparation of these standalone financial
statements. These policies have been consistently applied to
all the years presented, unless otherwise stated.
(a) Basis of preparation and presentation
(i) Compliance with Ind AS
The standalone financial statements for the year
ended March 31, 2025 have been prepared in
accordance with the Indian Accounting Standards
(referred to as "Ind AS”) notified under the
Companies (Indian Accounting Standards) Rules,
2015 (as amended from time to time) and other
relevant provisions of the Companies Act 2013 ("the
Act") (as amended from time to time).
All amounts disclosed in the financial statements
and notes have been rounded off to the nearest
H lakh except number of shares, face value of share,
earning per share or wherever otherwise indicated.
as per the requirement of Schedule III, unless
otherwise stated.
(ii) Historical cost convention
The standalone financial statements have been
prepared on a historical cost basis except for
certain assets and liabilities (including derivative
instruments) 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.
Fair value is the price that would be received to sell an
asset orpaid to transfer a liability in an orderly transaction
between market participants at the measurement date,
regardless of whether that price is directly observable
or estimated using another valuation technique. In
estimating the fair value of an asset or a liability, the
Company takes into account the characteristics of
the asset or liability if market participants would take
those characteristics into account when pricing the
asset or liability at the measurement date. Fair value
for measurement and/or disclosure purposes in these
standalone financial statements is determined on such
a basis, except for leasing transactions that are within
the scope of Ind AS 116 Leases, and measurements that
have some similarities to fair value but are not fair value,
such as net realisable value in Ind AS 2 Inventories or
value in use in Ind AS 36 Impairment of Assets.
(iii) The Company has prepared the standalone financial
statements on the basis that it will continue to
operate as going concern.
(b) Current versus non-current classification
The Company presents assets and liabilities in the balance
sheet based on current/ non-current classification. An
asset is treated as current when it is:
• Expected to be realised or intended to be sold or
consumed in normal operating cycle
• Held primarily for the purpose of trading
• Expected to be realised within twelve months after
the reporting period, or
• 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:
• It is expected to be settled in normal operating cycle
• It is held primarily for the purpose of trading
• It is due to be settled within twelve months after the
reporting period, or
• There is no unconditional right to defer the
settlement of the liability for at least twelve months
after the reporting period
The terms of the liability that could, at the option of
the counterparty, result in its settlement by the issue of
equity instruments do not affect its classification.
All other liabilities are classified as non-current.
Deferred tax assets and liabilities are classified as non¬
current assets and liabilities.
The operating cycle is the time between the acquisition
of assets for processing and their realisation in cash and
cash equivalents. The Company has identified twelve
months as its operating cycle.
(c) Foreign currencies
(i) Functional and presentation currency
The standalone financial statements are presented
in Indian rupee (H), which is Company's functional
and presentation currency unless stated otherwise.
(ii) Transactions and balances
Transactions in foreign currencies are initially
recorded by the Company's entities at their
respective functional currency spot rates at the
date the transaction first qualifies for recognition.
However, for practical reasons, the Company uses
average rate if the average approximates the actual
rate at the date of the transaction.
Monetary assets and liabilities denominated
in foreign currencies are translated at the
functional currency spot rates of exchange at the
reporting date.
(iii) Foreign exchange gains and losses are presented in
the statement of profit and loss on a net basis.
(d) Revenue recognition
Revenue from contracts with customers is recognised
when control of the goods are transferred to the
customer at an amount that reflects the consideration to
which the Company expects to be entitled in exchange for
those goods. The Company has generally concluded that
it is the principal in its revenue arrangements because
it typically controls the goods before transferring them
to the customer.
(i) Sale of goods
Revenue from the sale of products is recognised
when the control of the goods has been transferred
to the customer.The performance obligation in case
of sale of product is satisfied at a point in time i.e.,
when the material is shipped to the customer or
on delivery to the customer, as may be specified
in the contract.
Variable Consideration
The Company recognizes revenue from the sale
of goods measured at the standalone selling price
of the consideration received or receivable, net of
returns and allowances, trade discounts and volume
rebates. If the consideration in a contract includes
a variable amount, the Company estimates the
amount of consideration to which it will be entitled
in exchange for transferring the goods to the
customer. The variable consideration is estimated at
contract inception and constrained until it is highly
probable that a significant revenue reversal in the
amount of cumulative revenue recognized will not
occur when the associated uncertainty with the
variable consideration is subsequently resolved.
(ii) Sale of services
Revenue from services represents the job work
services and repairing of moulds performed by the
Company for its customers, Revenue from services
is recognized as per the terms of the contract with
the customer over the period of time when the
control of services is transferred to the customers.
(iii) Contract balance
A contract asset is the right to consideration in
exchange for goods or services transferred to the
customer. Contract assets are in the nature of unbilled
receivables, which arises when Company satisfies
a performance obligation but does not have an
unconditional rights to consideration. A receivables
represents the Company's right to an amount of
consideration that is unconditional. Contract assets
are subject to impairment assessment. Refer to
accounting policies on impairment of financial assets
in section (Financial instruments - initial recognition
and subsequent measurement).
A contract liability is the obligation to transfer goods
or services to a customer for which the Company has
received consideration (or an amount of consideration
is due) from the customer. If a customer pays
consideration before the Company transfers goods
or services to the customer, a contract liability is
recognized when the payment is made or the payment
is due (whichever is earlier). Contract liabilities are
recognized as revenue when the Company performs
under the contract (i.e., transfers control of the related
goods or services to the customer).
A trade receivable is recognized if an amount of
consideration that is unconditional (i.e., only the
passage of time is required before payment of the
consideration is due). Refer to accounting policies
of financial assets in section (Financial instruments
- initial recognition and subsequent measurement).
(iv) Other Income
Other income comprise interest income, rental
income, liabilities no longer required written back,
refund of electricity duty, and others.
Interest income is accrued on a timely basis, by
reference to the principal outstanding and recorded
using the effective interest rate (EIR). EIR is the
rate that exactly discounts estimated future cash
receipts through the expected life of the financial
asset to the gross carrying amount of the financial
asset. When calculating the EIR, the Company
estimates the expected cash flows by considering
all the contractual terms of the financial instrument
but does not consider the expected credit losses.
Rental income arising from operating lease is
accounted on a straight line basis over the lease term.
In respect of others, Company recognized income
when the right to receive is established.
(e) Government grants
Grants from the government are recognised where
there is a reasonable assurance that the grant will be
received and the Company will comply with all attached
conditions. When the grant relates to an expense item,
it is recognised as income on a systematic basis over the
periods that the related costs, for which it is intended to
compensate, are expensed.
When the Company receives grants of non-monetary assets,
the asset and the grant are recorded at fair value amounts and
released to statement of profit and loss over the expected
useful life in a pattern of consumption of the benefit of the
underlying asset i.e. by equal annual instalments.
When loans or similar assistance are provided by
governments or related institutions, with an interest
rate below the current applicable market rate, the effect
of this favourable interest is regarded as a government
grant. The loan or assistance is initially recognised and
measured at fair value and the government grant is
measured as the difference between the initial carrying
value of the loan and the proceeds received. The loan
is subsequently measured as per the accounting policy
applicable to financial liabilities.
(f) Income tax
The income tax expense or credit for the period is the
tax payable on the current period's taxable income
based on the applicable income tax rate adjusted by
changes in deferred tax assets and liabilities attributable
to temporary differences and to unused tax losses.
Income Tax expense for the year comprises of current tax
and deferred tax.
(i) Current tax
Current income tax assets and liabilities are
measured at the amount expected to be recovered
from or paid to the taxation authorities. The tax
rates and tax laws used to compute the amount are
those that are enacted or substantively enacted, at
the reporting date where the Company operates
and generates taxable income.
Current income tax relating to items recognised
outside the statement of profit and loss is
recognised outside statement of profit and loss
(either in other comprehensive income or in equity).
Current tax items are recognised in correlation to
the underlying transaction either in OCI or directly
in equity. Management periodically evaluates
positions taken in the tax returns with respect to
situations in which applicable tax regulations are
subject to interpretation and considers whether
it is probable that a taxation authority will accept
an uncertain tax treatment. The Company shall
reflect the effect of uncertainty for each uncertain
tax treatment by using either most likely method
or expected value method, depending on which
method predicts better resolution of the treatment,
(ii) Deferred tax
Deferred tax is recognised on temporary differences
between the carrying amounts of assets and liabilities
in the standalone financial statements and the
corresponding tax bases used in the computation of
taxable profit. Deferred tax liabilities are generally
recognised for all taxable temporary differences.
Deferred tax assets are generally recognised for all
deductible temporary differences, the carry forward
of unused tax credits and unused tax losses to the
extent that it is probable that taxable profits will be
available against which those deductible temporary
differences, the carry forward of unused tax
credits and unused tax losses can be utilised. Such
deferred tax assets and liabilities are not recognised
if the temporary difference arises from the initial
recognition (other than in a business combination)
of assets and liabilities in a transaction that affects
neither the taxable profit nor the accounting profit.
The carrying amount of deferred tax assets is
reviewed at the end of each reporting period 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 asset to be recovered.
Deferred tax liabilities and assets are measured at
the tax rates that are expected to apply in the year
in which the liability is settled or the asset realised,
based on tax rates (and tax laws) that have been
enacted or substantively enacted by the end of the
reporting period.
Deferred tax relating to items recognized outside
the statement of profit and loss is recognized outside
the statement of profit and loss (either in other
comprehensive income or in equity). Deferred tax
items are recognized in correlation to the underlying
transaction either in OCI or direct in equity.
The measurement of deferred tax liabilities and
assets reflects the tax consequences that would
follow from the manner in which the Company
expects, at the end of the reporting period, to
recover or settle the carrying amount of its assets
and liabilities.
The Company offsets deferred tax assets and
deferred tax liabilities if and only if it has a legally
enforceable right to set off current tax assets and
current tax liabilities and the deferred tax assets
and deferred tax liabilities relate to income taxes
levied by the same taxation authority on either the
same taxable entity or different taxable entities
which intend either to settle current tax liabilities
and assets on a net basis, or to realise the assets
and settle the liabilities simultaneously, in each
future period in which significant amounts of
deferred tax liabilities or assets are expected to be
settled or recovered.
(g) Leases
The Company assesses at contract inception whether a
contract is, or contains, a lease. That is, if the contract
conveys the right to control the use of an identified asset
for a period of time in exchange for consideration.
To assess whether a contract conveys the right to
control the use of an identified asset, the Company
assesses whether: (i) the contract involves the use of an
identified asset (ii) the Company has substantially all of
the economic benefits from use of the asset through the
period of the lease and (iii) the Company has the right to
direct the use of the asset.
Company as a lessee
The Company's lease asset classes primarily consist of
leases for land and buildings. The Company applies a
single recognition and measurement approach for all
leases, except for short-term leases and leases of lowvalue
assets. The Company recognises lease liabilities to make
lease payments and right-of-use assets representing the
right to use the underlying assets.
(i) Right-of-Use assets (ROU)
The Company recognises right-of-use assets at the
commencement date of the lease (i.e., the date the
underlying asset is available for use). Right-of-use
assets are measured at cost, less any accumulated
depreciation and impairment losses, and adjusted
for any remeasurement of lease liabilities. The
cost of right-of-use assets includes the amount
of lease liabilities recognized, initial direct costs
incurred, and lease payments made at or before
the commencement date less any lease incentives
received. Right-of-use assets are depreciated on a
straight-line basis over the lease term.
The Company classifies ROU assets as part of
Property, plant and equipment in Balance Sheet and
lease liability in " financial liability”.
(ii) Lease liabilities
At the commencement date of the lease, the
Company recognises lease liabilities measured at
the present value of lease payments to be made
over the lease term. The lease payments include
fixed payments (including in substance fixed
payments) less any lease incentives receivable,
variable lease payments that depend on an index
or a rate, and amounts expected to be paid under
residual value guarantees. The lease payments
also include the exercise price of a purchase option
reasonably certain to be exercised by the Company
and payments of penalties for terminating the lease,
if the lease term reflects the Company exercising the
option to terminate. Variable lease payments that
do not depend on an index or a rate are recognized
as expenses (unless they are incurred to produce
inventories) in the period in which the event or
condition that triggers the payment occurs.
In calculating the present value of lease payments,
the Company uses its incremental borrowing rate at
the lease commencement date because the interest
rate implicit in the lease is not readily determinable.
After the commencement date, the amount of lease
liabilities is increased to reflect the accretion of
interest and reduced for the lease payments made.
In addition, the carrying amount of lease liabilities
is remeasured 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.
Lease payments are allocated between principal
and finance cost. The finance cost is charged to
profit or loss over the lease period so as to produce
a constant periodic rate of interest on the remaining
balance of the liability for each period. Variable
lease payments that depend on sales are recognized
in profit or loss in the period in which the condition
that triggers those payments occurs.
(iii) Short term leases and leases of low-value of assets
The Company applies the short-term lease
recognition exemption to its short-term leases (i.e.,
those leases that have a lease term of 12 months
or less from the commencement date and do not
contain a purchase option). It also applies the lease
of low-value assets recognition exemption to leases
that are considered to be low value.
Lease payments on short-term leases and leases
of low-value assets are recognized as expense on a
straight-line basis over the lease term.
Company as a lessor
Leases for which the Company is a lessor is classified
as a finance or operating lease. Whenever the terms
of the lease transfer substantially all the risks and
rewards of ownership to the lessee, the contract
is classified as a finance lease. All other leases are
classified as operating leases.
When the Company is an intermediate lessor, it
accounts for its interests in the head lease and the
sublease separately. The sublease is classified as a
finance or operating lease by reference to the right-
of-use asset arising from the head lease.
For operating leases, rental income is recognized
on a straight line basis over the term of the
relevant lease.
(h) Borrowing Costs
Borrowing costs directly attributable to the acquisition,
construction or production of an asset that necessarily
takes a substantial period of time to get ready for its
intended use or sale are capitalised 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.
(i) Earnings Per Share (EPS)
Basic earnings per share are calculated by dividing
the net profit or loss for the period attributable
to equity shareholders by the weighted average
number of equity shares outstanding during the
period. The weighted average number of equity
shares outstanding during the period is adjusted
for events such as bonus issue, bonus element in
a rights issue, share split, and reverse share split
(consolidation of shares) if any that have changed
the number of equity shares outstanding, without a
corresponding change in resources.
For the purpose of calculating diluted earnings
per share, the net profit or loss for the period
attributable to equity shareholders and the
weighted average number of shares outstanding
during the period are adjusted for the effect of all
potentially dilutive equity shares.
(j) Property, plant and equipment
Property, plant and equipment are tangible items that
are held for use in the production or supply for goods and
services, rental to others or for administrative purposes
and are expected to be used during more than one period.
The cost of an item of property, plant and equipment
shall be recognised as an asset if and only if it is probable
that future economic benefits associated with the item
will flow to the Company and the cost of the item can be
measured reliably.
The items of property, plant and equipment are stated
at cost less accumulated depreciation and accumulated
impairment losses. Cost includes expenditure that is
directly attributable to the acquisition of the items and
are net of recoverable taxes /duty. Subsequent costs are
included in the asset's carrying amount or recognised as
a separate asset, as appropriate, only when it is probable
that future economic benefits associated with the item
will flow to the Company and the cost of the item can
be measured reliably.All other repair and maintenance
costs are recognised in statement of profit and loss as
incurred. The present value of the expected cost for the
decommissioning of an asset after its use is included in
the cost of the respective asset if the recognition criteria
for a provision are met.
Each part of item of property, plant and equipment,
if significant in relation to the total cost of the item,
is depreciated separately. Further, parts of plant and
equipment that are technically advised to be replaced at
prescribed intervals/period of operation are depreciated
separately based on their specific useful life provided
these are of significant amounts commensurate with
the size of the Company and scale of its operations. The
carrying amount of any equipment accounted for as
separate asset is derecognised when replaced.
Capital work- in- progress includes cost of property, plant
and equipment under installation / under development
as at the balance sheet date. Capital work in progress is
stated at cost, net of accumulated impairment loss, if any.
An item of property, plant and equipment is derecognised
upon disposal or when no future economic benefits are
expected to arise from the continued use of the asset.
Any gain or loss arising on the disposal or retirement of
an item of property, plant and equipment is determined
as the difference between the sales proceeds and
the carrying amount of the asset and is recognised in
statement of profit or loss.
Depreciation methods, estimated useful lives
and residual value
Depreciation commences when the assets are ready for
their intended use. Depreciation is calculated using the
straight-line method to allocate their cost, net of their
residual values, over their estimated useful lives.
Depreciation on Property, Plant & Equipment has been
provided on Straight Line Method (SLM) based on the
useful life of the assets prescribed in Schedule II of the
Companies Act, 2013 except in respect of major plant &
machinery, where useful life has been taken as 25 years,
as technically assessed.
The estimated useful lives, residual values and
depreciation method are reviewed at the end of each
reporting period, with the effect of any changes in
estimate accounted for on a prospective basis.
Depreciation is not recorded on capital work in progress
until construction and installation are complete and the
assets is ready for its intended use.
(k) Intangible assets
Intangible assets acquired separately are measured on
initial recognition at cost. Following initial recognition,
intangible assets are carried at cost less any accumulated
amortisation and accumulated impairment losses.
Internally generated intangibles, excluding capitalised
development costs, are not capitalised and the related
expenditure is reflected in profit or loss in the period in
which the expenditure is incurred.
Amortisation is recognised on a straight-line basis over
their estimated useful lives. The estimated useful life
and amortisation method are reviewed at the end of
each reporting period, with the effect of any changes in
estimate being accounted for on a prospective basis.
Estimated useful lives of the intangible assets are
as follows:
An intangible asset is derecognised on disposal, or when
no future economic benefits are expected from use or
disposal. Gains or losses arising from derecognition of
an intangible asset, measured as the difference between
the net disposal proceeds and the carrying amount of the
asset, are recognised in statement of profit or loss when
the asset is derecognised.
Research and development costs
Research costs are expensed as incurred. Development
expenditures on an individual project are recognised as
an intangible asset when the Company can demonstrate:
(i) the technical feasibility of completing the intangible
asset so that the asset will be available for use or sale;
(ii) its intention to complete and its ability and intention
to use or sell the asset;
(iii) how the asset will generate probable future
economic benefits;
(iv) the availability of adequate technical, financial and
other resources to complete the development and
to use or sell the asset; and
(v) the ability to measure reliably the expenditure
attributable to asset during its development.
The amount initially recognised for intangible assets is the
sum of the expenditure incurred from the date when the
intangible asset first meets the recognition criteria listed
above. Where no intangible assets can be recognised,
development expenditure is recognised in statement
of profit or loss in the period in which it is incurred.
Subsequent to initial recognition, such intangible assets
are reported at cost less accumulated amortisation and
accumulated impairment losses, on the same basis as of
acquired intangible assets.
(l) Inventories
Inventories are valued at the lower of cost and net
realisable value. However, materials and other items held
for use in the production of inventories are not written
down below cost if the finished products in which they
will be incorporated are expected to be sold at or above
cost. The comparison of cost and net realizable value is
made on an item-by-item basis
(i) Inventories of raw materials, components, stores
and spares are valued at lower of cost ( net of
recoverable taxes ) and net realizable value. Cost
for the purpose of valuation of such inventories
is determined using the first-in, first-out (FIFO)
method. Net realizable value is the estimated
selling price in the ordinary course of business less
the estimated cost of completion and the estimated
cost necessary to make the sale.
(ii) Finished goods and work-in-progress are valued at
lower of cost and net realizable value. The cost of
finished goods and work-in-progress includes raw
material costs (net of recoverable taxes), direct
cost of conversion and proportionate allocation of
indirect costs incurred in bringing the inventories to
their present location and condition.
(iii) Traded goods: cost includes cost of purchase and
other costs incurred in bringing the inventories
to their present location and condition. Cost is
determined on weighted average basis.
(iv) The provision for inventory obsolescence is assessed
regularly based on estimated usage and shelf
life of inventory.
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