2 Material accounting policies2.1 Basis of preparation and measurement

The standalone financial statements of the Company have been prepared in accordance with Indian Accounting
Standards ("Ind AS") notified under Section 133 of the Companies Act, 2013 read with Companies (Indian Accounting
Standards) Rules, 2015, as amended and presentation requirements of Division II of Schedule III to the Companies Act
2013 (IND AS compliant Schedule III) as applicable.

These standalone financial statements are presented in Indian Rupees ('), which is the Company's functional currency.
All amounts are presented in millions and are rounded off to three decimal places, as per the requirements of Schedule
III to the Act, unless otherwise stated.

The Company has prepared the standalone financial statements on the basis that it will continue to operate as a going
concern.

2.2 Summary of material accounting policiesa. Current versus non-current classification

The Company segregates assets and liabilities into current and non-current categories for presentation in the
balance sheet after considering its normal operating cycle and other criteria set out in Ind AS 1, "Presentation of
Financial Statements". For this purpose, current assets and liabilities include the current portion of non-current
assets and liabilities respectively. Deferred tax assets and liabilities are always classified as non-current.

The operating cycle is the time between the acquisition of assets for processing and their realization in cash and
cash equivalents. The Group has identified period up to twelve months as its operating cycle.

b. Foreign currencies

Functional and presentation currency

The Company's standalone financial statements are presented in Indian Rupees, which is also the functional
currency of the Company and the currency of the primary economic environment in which the Company operates.
Transaction and balances

On initial recognition, all foreign currency transactions are recorded by applying to the foreign currency amount
the exchange rate between the functional currency and the foreign currency at the date of the transaction. Gains/
Losses arising out of fluctuation in foreign exchange rate between the transaction date and settlement date are
recognised in the Statement of Profit and Loss.

All monetary assets and liabilities in foreign currencies are restated at the year end at the exchange rate prevailing
at the year end and the exchange differences are recognised in the Statement of Profit and Loss.

Non-monetary items that are measured in terms of historical cost in a foreign currency are translated using the
exchange rates at the dates of the initial transactions. Non-monetary items measured at fair value in a foreign
currency are translated using the exchange rates at the date when the fair value is determined. The gain or loss
arising on translation of non-monetary items measured at fair value is treated in line with the recognition of the
gain or loss on the change in fair value of the item i.e., translation differences on items whose fair value gain or
loss is recognised in Other comprehensive income ('OCI') or statement of profit and loss are also recognised in
OCI or statement of profit and loss, respectively.

c. Fair value measurement

The Company measures financial instruments such as investments in bonds/ debentures at fair value through
Other Comprehensive income and investments in mutual funds at fair value through Profit and loss at each
balance sheet date.

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, maximising the use of relevant observable inputs and minimising 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 summarises accounting policy for fair value. Other fair value related disclosures are given in the relevant
notes.

• Significant accounting judgements, estimates and assumptions (Refer note 2)

• Quantitative disclosures of fair value measurement hierarchy (Refer note 37)

• Financial instruments risk management objectives and policies (Refer note 38)

d. Revenue from Contract with customer:

Revenue from contracts with customers is recognised when control of the goods or services 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 or services. The Company collects goods and services tax on behalf of the government and,
therefore, it is not an economic benefit flowing to the Company. Hence, it is excluded from revenue.

The Company has following streams of revenue:

Revenue from Engineering, Procurement and Construction contracts (EPC): These contracts are specifically
negotiated for the construction of an asset which refers to any project for construction of plants and systems,
involving designing, engineering, fabrication, supply, erection (or supervision thereof) etc., execution of which
is spread over different accounting periods. The Company identifies distinct performance obligations in each
contract. For most of the project contracts basis the assessment, the entire contract is accounted for as one
performance obligation.

The Company first assesses whether the revenue can be recognised over a period of time if any of the following
criteria is met:

(a) The customer simultaneously consumes the benefits as the Company performs; or

(b) The customer controls the work-in-progress; or

(c) The Company's performance does not create an asset with alternative use to the Company and the has right
to payment for performance completed till date.

The Company recognises revenue over time for project contracts as above criteria is met.

The Company uses cost-based measure of progress (or input method) for contracts because it best depicts the
transfer of control to the customer which occurs as it incurs costs on contracts. Under the cost-based measure
of progress, the extent of progress towards completion is measured based on the ratio of costs incurred to date
to the total estimated costs at completion of the performance obligation. Revenues, including estimated profits,
are recorded proportionally as costs are incurred.

When the final outcome of a contract cannot be reliably estimated, contract revenue is recognised only to the
extent of costs incurred that are expected to be recoverable. Determination of revenues under the percentage
of completion method necessarily involves making estimates by the Company, some of which are of a technical
nature, concerning, where relevant, the percentage of completion, costs to completion, the expected revenues
from the project / activity and the foreseeable losses to completion.

Execution of contracts generally extends beyond accounting periods, the revision in costs and revenues estimated
during the course of the contract are reflected in the accounting period in which the facts requiring the revision
become known.

For contracts where the aggregate of contract cost incurred to date plus recognised profits (or minus recognised
losses as the case may be) exceeds the progress billing, the surplus is shown as contract assets.

For contracts where progress billing exceeds the aggregate of contract costs incurred to-date plus recognised
profits (or minus recognised losses, as the case may be), the surplus is shown as contract liability and termed as
"Dues to customers relating to contracts in progress".

The Company estimates variable consideration including variation and claim (liquidated damages if any) and
includes it in the transaction price to the extent it is highly probable that a significant reversal of cumulative
revenue recognised will not occur and when the uncertainty associated with it is subsequently resolved. Variable
consideration is estimated using the expected value method or most likely amount as appropriate in a given
circumstance. Payment terms agreed with a customer are as per business practice and generally do not include
significant financing component.

Costs to obtain a contract which are incurred regardless of whether the contract was obtained are charged-off
in profit or loss immediately in the period in which such costs are incurred. Incremental costs of obtaining a
contract, if any, and costs incurred to fulfil a contract are amortised over the period of execution of the contract in
proportion to the progress measured in terms of a proportion of actual cost incurred to-date, to the total estimated
cost attributable to the performance obligation.

Contract modification, when approved by both the parties to the contract, are considered as modification, if it
creates new or changes the existing enforceable rights and obligations. The effect of a contract modification is
recognised as an adjustment to revenue on a cumulative catch-up basis.

When it becomes probable that the total contract costs will exceed the total contract revenue, the Company
recognises the expected losses from onerous contract as an expense immediately. Penalties for any delay or
improper execution of a contract if any are recognised as a deduction from revenue. In the balance sheet, such
provisions are presented on net basis of the contract receivables.

Revenue from sale of goods: In case of traded goods and certain products wherein revenue recognition criteria of
over a period of time is not met, Company recognises revenue at a point-in-time. The point-in-time is determined
when the control of the goods or services is transferred which is determined based on when the significant
risks and rewards of ownership are transferred to the customer. Apart from this, the Company also considers its
present right to payment, the legal title to the goods, the physical possession and the customer acceptance in
determining the point in time where control has been transferred.

Revenue from sale of services: Revenue in respect of design and engineering service contracts , awarded on
a standalone basis are identified as a separate performance obligation and revenue is recognised on a time
proportion basis as per the terms of the contract.

Significant estimates, assumptions and judgements

• Determining the revenue to be recognised in case of performance obligation satisfied over a period of
time : A significant portion of the Company's business relates to EPC contracts which is accounted using
cost-based input method, recognising revenue as the performance on the contract progresses. This
requires management to make judgement with respect to identifying contracts for which revenue need to
be recognised over a period of time, depending upon when the customer consumes the benefit, when the
control is passed to customer, whether the asset created has an alternative use and whether the Company
has right to payment for performance completed till date, either contractually or legally. At each reporting
date, the Company is required to estimate costs to complete the contracts. Estimating costs to complete on
such contracts requires the Company to make estimates of future costs to be incurred, based on work to be
performed beyond the reporting date. This estimate will impact revenues, cost of sales, work-in-progress,
billings in excess of costs, estimated earnings and accrued contract expenses;

• Determining the expected losses, which are recognised in the period in which such losses become probable
based on the expected total contract cost as at the reporting date.

• Determining the method to be applied to arrive at the variable consideration including variations and
claims(including liquidated damages) requiring an adjustment to the transaction price. Variable consideration
is recognised when the recovery of such consideration is highly probable. This requires an estimate of the
amount if any under a claim which involves a number of management judgements and assumptions.

e. Other Income:• Interest income

Interest income from debt instruments is recognized using effective interest rate method (EIR). EIR is the
rate that discounts the estimated future cash receipts over the life of the financial instrument or a shorter
period, where appropriate, to the carrying amount of the financial asset.

• Dividends

Dividends are recognised in the statement of profit and loss only when the right to receive the payment is
established, it is probable that the economic benefits associated with the dividend will flow to the Company,
and when the amount can be measured reliably.

• Insurance claims

Income for insurance claims is recognised as and when claims are approved by the insurance authorities.

• Export benefits

Government grant in form of Export benefits are recognised as 'Other Operating revenue' on receipt basis.

f. Taxes :

Income tax expense comprises current and deferred tax. It is recognised in the statement of profit and loss except
to the extent that it relates to a business combination, or items recognised directly in equity or in OCI.

• Current tax

Current tax comprises the expected tax payable or receivable on the taxable income or loss for the year and
any adjustment to the tax payable or receivable in respect of previous years.

Current 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 were enacted at
the reporting date in India under the Income Tax Act, 1961. Current tax assets and liabilities are offset only
if certain criteria are met, and such offsetting is legally enforceable.

• Deferred tax

Deferred tax is provided using the balance sheet method on temporary differences between the carrying
amounts of assets and liabilities in the Financial Statements and the corresponding tax bases used in the
computation of taxable profit under Income tax Act, 1961.

Deferred tax is recognized on all deductible and taxable temporary differences between the accounting
income and the taxable income for the year. The tax effect is calculated on the accumulated deductible
temporary differences at the end of the accounting period based on prevailing enacted or subsequently
enacted regulations.

Deferred tax liabilities are recognized for all taxable temporary differences. Deferred tax assets are recognized
for deductible temporary differences only to the extent there is reasonable certainty that sufficient future
taxable income will be available against which such deferred tax assets can be realized.

The carrying amount of deferred tax assets is reviewed at each reporting date and reduced to the extent
that it is no longer probable that sufficient taxable profit will be available to allow all or part of the deferred
tax asset to be utilized. Unrecognized deferred tax assets are re-assessed at each reporting date and are
recognised to the extent that it has become probable that future taxable profits will allow the deferred tax
asset to be recovered.

Deferred tax assets and liabilities are measured at the tax rates that are expected to apply in the year when
the asset is realised or the liability is settled, based on tax rates (and tax laws) that have been enacted or
substantively enacted at the reporting date.

Deferred tax assets and deferred tax liabilities are offset if a legally enforceable right exists to set off current tax
assets against current tax liabilities and the deferred taxes relate to the same taxable entity and the same taxation
authority.

g. Property, Plant and Equipment (PPE):

Recognition and measurement

PPE is recognised 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.

PPE that qualifies as an asset is measured at cost of acquisition or construction less accumulated depreciation
and/or accumulated impairment loss, if any. The Company identifies and determines cost of each component/
part of the asset separately, if the component/part has a cost which is significant to the total cost of the asset
and has useful life that is materially different from that of the remaining asset.

The cost of an item of PPE comprises of its purchase price net of discounts, if any including import duties and
other non-refundable taxes or levies and directly attributable cost of bringing the asset to its working condition
for its intended use. Borrowing costs directly attributable to the construction of a qualifying asset are capitalised
as part of the cost. 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.

PPE under construction is disclosed as capital work-in-progress.

Advances paid towards the acquisition of PPE outstanding at each reporting date are disclosed under 'Other
assets'.

Subsequent costs

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. The carrying amount of any component accounted for as a separate
asset is derecognised when replaced. The costs of the day-to-day servicing of PPE are recognised in the statement
of profit and loss as incurred.

Disposal

An item of PPE is derecognised upon disposal or when no future benefits are expected from its use or disposal.
Net gains and losses on disposal of an item of PPE are determined by comparing the proceeds from disposal
with the carrying amount of PPE, and are recognised within other income/ expenses in the statement of profit and
loss.

Depreciation

Depreciation is calculated over the depreciable amount, which is the cost of an asset, or other amount substituted
for cost, less its residual value. Depreciation is recognised in the statement of profit and loss on a straight-line
basis over the estimated useful lives of each part of an item of PPE as prescribed in Schedule II of the Companies
Act, 2013, or as assessed by the management of the Company based on technical evaluation. Freehold land
is not depreciated. The identified components are depreciated separately over their useful lives; the remaining
components are depreciated over the life of the principal asset.

PPE acquired under leases is depreciated over the shorter of the lease term and their useful lives unless it is
reasonably certain that the Company will obtain ownership by the end of the lease term.

h. Intangible assets

Recognition and measurement

Intangible assets are recognised when the asset is identifiable, is within the control of the Company, it is probable
that the future economic benefits that are attributable to the asset will flow to the Company and cost of the asset
can be reliably measured.

Intangible assets are stated at original cost net of tax/duty credits availed, if any, less accumulated amortisation
and cumulative impairment. All directly attributable costs and other administrative and other general overhead
expenses that are specifically attributable to acquisition of intangible assets are allocated and capitalised as a
part of the cost of the intangible assets.

Internally generated intangible asset

- Research costs are charged to the statement of profit and loss in the year in which they are incurred.

- Development costs incurred on new products including pilot plants are recognised as intangible assets,
when:

a. feasibility has been established,

b. the Company has committed technical, financial and other resources to complete the development, and

c. it is probable that the asset will generate future economic benefits.

- Development expenditure that does not meet the above criteria is expensed in the period in which it is
incurred.

- Intangible assets not ready for the intended use on the date of the Balance Sheet are disclosed as "Intangible
assets under development" and amortisation is not charged on until development is complete.

- The cost of an internally generated intangible asset is the sum of directly attributable expenditure incurred
from the date when the intangible asset first meets the recognition criteria to the completion of its
development.

- Interest costs incurred on qualifying assets are capitalized until the date the asset is ready for its intended
use. If the borrowings are specifically for financing the asset, interest on these borrowings is capitalized. If
the borrowings are general, the cost computed on the weighted average rate is capitalized.

- Internally generated intangible asset is measured at cost less accumulated amortisation and impairment, if
any.

- Amortisation is not recorded on product engineering in progress until development is complete.
Subsequent measurement

Subsequent expenditure is capitalised only when it increases the future economic benefits embodied in the
specific asset to which it relates.

Amortisation

Intangible Assets with finite lives are amortised on a Straight-Line basis over the estimated useful economic life.
Amortisation is calculated on the cost of the asset, or other amount substituted for cost, less its residual value.
The amortisation expense on intangible assets with finite lives is recognised in the Statement of Profit and Loss.
The estimated useful life of intangible assets is mentioned below:

Intangible assets with indefinite useful lives are not amortised, but are tested for impairment annually, either
individually or at the cash-generating unit level.

i. Non-current asset held for sale

Non-current assets are classified as held for sale if their carrying amount is intended to be recovered principally
through a sale (rather than through continuing use) when the asset is available for immediate sale in its present
condition subject only to terms that are usual and customary for sale of such asset and the sale is highly probable
and is expected to qualify for recognition as a completed sale within one year from the date of classification.

Non-current assets classified as held for sale are measured at lower of their carrying amount and fair value less
costs to sell.

j. Leases

Assets taken on lease are accounted as right-of-use assets and the corresponding lease liability is recognised at
the lease commencement date.

Initially the right-of-use asset is measured at cost which comprises the initial amount of the lease liability adjusted
for any lease payments made at or before the commencement date, plus any initial direct costs incurred and an
estimate of costs to dismantle and remove the underlying asset or to restore the underlying asset or the site on
which it is located, as reduced by any lease incentives received.

The lease liability is initially measured at the present value of the lease payments, discounted using the Company's
incremental borrowing rate. It is remeasured when there is a change in future lease payments arising from a
change in an index or a rate, or a change in the estimate of the guaranteed residual value, or a change in the
assessment of purchase, extension or termination option. When the lease liability is remeasured in this way, a
corresponding adjustment is made to the carrying amount of the right-of-use asset or is recorded in the statement
of profit or loss if the carrying amount of the right-of-use asset has been reduced to zero

The right-of-use asset is measured by applying cost model i.e. right-of-use asset at cost less accumulated
depreciation and cumulative impairment, if any. The right-of-use asset is depreciated using the straight-line
method from the commencement date to the end of the lease term or useful life of the underlying asset whichever
is earlier. Carrying amount of lease liability is increased by interest on lease liability and reduced by lease payments
made.

Lease payments associated with following leases are recognised as expense on straight-line basis:

(i) Low value leases; and

(ii) Leases which are short-term.

Assets given on lease are classified either as operating lease or as finance lease. A lease is classified as a finance
lease if it transfers substantially all the risks and rewards incidental to ownership of an underlying asset. Asset
held under finance lease is initially recognised in balance sheet and presented as a receivable at an amount
equal to the net investment in the lease. Finance income is recognised over the lease term. A lease which is not

classified as a finance lease is an operating lease. The Company recognises lease payments in case of assets
given on operating leases as income on a straight-line basis. The Company presents underlying assets subject to
operating lease in its balance sheet under the respective class of asset.

k. Inventories

Inventories are valued after providing for obsolescence, as under:

Raw materials, components, stores and spares, work-in-progress and finished goods are valued at 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.

Cost of raw materials, components, stores and spares comprises cost of purchases.

Cost of work-in-progress and finished goods comprises direct materials, direct labour and an appropriate
proportion of variable and fixed overhead expenditure, the latter being allocated based on normal operating
capacity. Cost of inventories also includes all other costs incurred in bringing the inventories to their present
location and condition. Costs are assigned to individual items of inventory based on weighted average basis.

Net realisable value is the estimated selling price in the ordinary course of business, less estimated costs of
completion and the estimated costs necessary to make the sale.

Provision is made for obsolete and slow-moving items based on management's assessment of their usability,
technological relevance, and recoverability, considering project-specific requirements.

l. Impairment of non-financial assets

The Company assesses at each balance sheet date whether there is any indication that an asset or cash generating
unit (CGU) may be impaired. If any such indication exists, the Company estimates the recoverable amount of the
asset. The recoverable amount is the higher of an assets or CGU's fair value less costs of disposal or its value
in use. Where 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.

In assessing 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 considered.

Impairment losses are recognised in the statement of profit and loss. They are allocated first to reduce the
carrying amount of any goodwill allocated to the CGU, and then to reduce the carrying amounts of other assets in
the CGU on a pro rata basis.

An impairment loss in respect of goodwill is not reversed. For other assets, an impairment loss is reversed
only to the extent that the asset's carrying amount does not exceed the carrying amount that would have been
determined, net of depreciation or amortisation, if no impairment loss had been recognised.

m. Employee benefits

• Short-term employee benefits

Employee benefits payable wholly within twelve months of rendering the service are classified as short-term
employee benefits and are recognised in the period in which the employee renders the related service.

• Post-employment benefits
Defined contribution plans

Contributions to the provident fund, pension scheme, employee state insurance scheme and superannuation
fund, which are defined contribution schemes, are recognised as an employee benefit expense in the
statement of profit and loss in the period in which the contribution is due.

Defined benefit plans

The employees' gratuity scheme is a defined benefit plan. The present value of the obligation under such
defined benefit plans is determined based on actuarial valuation using the projected unit credit method.

The obligation is measured at the present value of the estimated future cash flows. The discount rates used
for determining the present value of the obligation under defined benefit plans, is based on the market yields
on government securities as at the reporting date, having maturity periods approximating to the terms of
related obligations.

Re-measurement, comprising actuarial gains and losses, the return on plan assets (excluding amounts
included in net interest on the net defined benefit liability or asset) and any change in the effect of asset
ceiling (if applicable) is recognised in other comprehensive income and is reflected in retained earnings and
the same is not eligible to be reclassified to the statement of profit or loss.

Defined benefit costs comprising current service cost, past service cost and gains or losses on settlements
are recognised in the Statement of Profit and Loss as employee benefits expense. Interest cost implicit in
defined benefit employee cost is recognised in the Statement of Profit and Loss under finance costs. Gains
or losses on settlement of any defined benefit plan are recognised when the settlement occurs. Past service
cost is recognised as expense at the earlier of the plan amendment or curtailment and when the Company
recognises related restructuring costs or termination benefits.

I n case of funded plans, the fair value of the plan assets is reduced from the gross obligation under the
defined benefit plans, to recognise the obligation on net basis.

Other long-term employee benefits

The liabilities for earned leave are not expected to be settled wholly within twelve months after the end of the
reporting period in which the employees render the related service. They are therefore measured at present
value of estimated future cash flows expected to be made by the Company and is recognised in a similar
manner as in the case of defined benefit plans above.

Long-term employee benefit costs comprising current service cost and gains or losses on curtailments
and settlements, re-measurements including actuarial gains and losses are recognised in the Statement of
Profit and Loss as employee benefits expenses. Interest cost implicit in long-term employee benefit cost is
recognised in the Statement of Profit and Loss under finance costs.

Termination benefits

Termination benefits are expensed at the earlier of when the Company can no longer withdraw the offer of
those benefits and when the Company recognises costs for a restructuring. If benefits are not expected to
be settled wholly within 12 months of the reporting date, then they are stated at their present fair value.