2 Significant Accounting Policies
A Statement of compliance
The Company's financial statements have been prepared in accordance with the provisions of the
Companies Act, 2013 and the Indian Accounting Standards (Ind AS) notified under the Companies (Indian
Accounting Standards) Rules, 2015 and amendments thereto issued by the Ministry of Corporate Affairs
under section 133 of the Companies Act, 2013. In addition, the guidance notes/announcements issued by
the Institute of Chartered Accountants of India (ICAI) are also applied except where compliance with other
statutory promulgations require a different treatment. These financials statements have been approved for
issue by the Board of Directors at its meeting held on April 24, 2025
B Basis of Preparation and Presentation
The Financial Statements have been prepared accrual basis following historical cost convention except for
following assets and liabilities which have been measured at fair value amount in accordance with IND AS:
i) Certain Financial Assets and Liabilities (including derivative instruments),
ii) Defined Benefit Plans and Plan Assets
Fair value measurements are categorised as below based on the degree to which the inputs to the fair value
measurements are
observable and the significance of the inputs to the fair value measurement in its entirety:
(i) Level 1 inputs are quoted prices (unadjusted) in active markets for identical assets or liabilities that the
company can access at
measurement date;
(ii) Level 2 inputs are inputs, other than quoted prices included in level 1, that are observable for the assets or
liabilities, either directly or indirectly; and
(iii) Level 3 inputs are unobservable inputs for the valuation of assets or liabilities.
Above levels of fair value hierarchy are applied consistently and generally, there are no transfers between
the levels of the fair value hierarchy unless the circumstances change warranting such transfer.
The Balance Sheet, the Statement of Profit and Loss and the Statement of Changes in Equity are prepared
and presented in the format prescribed in the Schedule III to the Companies Act, 2013 (the Act). The
Statement of Cash Flows has been prepared and presented in accordance with Ind AS 7 "Statement of
Cash Flows". The disclosures with respect to items in the Balance Sheet and Statement of Profit and Loss, as
prescribed in the Schedule III to the Act, are presented by way of notes forming part of the financial
statements along with the other notes required to be disclosed under Ind AS and the SEBI (Listing Obligations
and Disclosure Requirements) Regulations, 2015 as amended.
Amounts in the financial statements are presented in Indian Rupees in lakhs [1 lakh = 0.1 million] rounded off
to two decimal places as permitted by Schedule III to the Act. Per share data are presented in Indian Rupees
to two decimal places.
C Current and 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 realized 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 Company classifies all other liabilities as non-current. Deferred tax assets and liabilities are classified as
non-current assets and liabilities.
D Property, plant & equipment
Property, plant and equipment are stated at cost, net of recoverable taxes,trade discounts and rebates less
accumulated depreciation and impairment losses,if any. Such costs comprises of purchase price,
borrowing cost and any initial directly attributable cost of bringing the asset to its working condition for its
intended use. Net charges on foreign exchange contracrs and adjustments arising from exchange rate
variations attributable to the assets.
Subsequent costs are included in the assets carrying amount or recognized as separate asset as
appropriate only when it is probable that future economic benefits associated with the item will flow to the
entity and cost can be measured reliably.
Depreciation is provided for property, plant and equipment on a Straight-Line Basis(SLM) so as to expense the
cost less residual value over their estimated useful lives based on a technical evaluation. The estimated
useful lives and residual values are reviewed at the end of each reporting period with the effect of any
change in estimated accounted for on a prospective basis.
Gains or losses arising from derecognition of a property, plant and equipment are measured as the
difference between net disposal proceeds and the carrying amount of the asset and are recognized in the
statement of profit & loss when the asset is derecognized.
Property, plant and equipment with finite life are evaluated for recoverability whenever there is any
indication that their carrying amounts may not be recoverable. If any such indication exists, the recoverable
amount (i.e., higher of the fair value less cost to sell and the value-in-use) is determined on an individual
asset basis unless the asset does not generate cash flows that are largely independent of those from other
assets. In such cases, the recoverable amount is determined for the cash generating unit (CGU) to which the
asset belongs. If the recoverable amount of an asset (or CGU) is estimated to be less than its carrying
amount, the carrying amount of the asset (or CGU) is reduced to its recoverable amount. An impairment loss
is recognised in the statement of profit and loss.
E Intangible Assets
Intangible assets purchased are measured at cost as at the date of acquisition, as applicable, less
accumulated amortisation and accumulated impairment, if any.
Intangible assets consist of Trademark and Patent and software licenses which are amortised over license
period which equates the economic useful life ranging between 5-10 years on a straight-line basis over the
period of its economic useful life.
Intangible assets with finite life are evaluated for recoverability whenever there is any indication that their
carrying amounts may not be recoverable. If any such indication exists, the recoverable amount (i.e., higher
of the fair value less cost to sell and the value-in-use) is determined on an individual asset basis unless the
asset does not generate cash flows that are largely independent of those from other assets. In such cases,
the recoverable amount is determined for the cash generating unit (CGU) to which the asset belongs. If the
recoverable amount of an asset (or CGU) is estimated to be less than its carrying amount, the carrying
amount of the asset (or CGU) is reduced to its recoverable amount. An impairment loss is recognised in the
statement of profit and loss.
Gains or losses arising from de recognition of an intangible asset are measured as the difference between
the net disposal proceeds and the carrying amount of the asset and are recognized in the Statement of
Profit and Loss when the asset is derecognized.
F 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 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 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 impairment losses, 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."
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,
based on a pattern reflecting a constant periodic rate of return on company's net investment in the lease. 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. "
G Research and Development Expenditure
Revenue expenditure pertaining to research is charged to the Statement of Profit and Loss as and when
incurred. Development costs are capitalized as an intangible asset if it can be demonstrated that the
project is expected to generate future economic benefits, it is probable that those future economic benefits
will flow to the entity and the costs of the asset can be measured reliably, else it is charged to the Statement
of Profit and Loss.
H Cash and Cash Equivalent
Cash and bank balances include fixed deposits, margin money deposits, earmarked balances with banks
and other bank balances which have restrictions on repatriation. Short term and liquid investments being
subject to more than insignificant risk of change in value, are not included as part of cash and bank
balances.
I Inventories
"(I) Raw materials, components, construction materials, stores, spares and loose tools at lower of weighted
average cost or net realisable value. However, these items are considered to be realisable at cost if the
finished products in which they will be used, are expected to be sold at or above cost.
(ii) Manufacturing work-in-progress at lower of weighted average cost including related overheads or net
realisable value. In some cases, manufacturing work-in-progress are valued at lower of specifically
identifiable cost or net realisable value. In the case of qualifying assets, cost also includes applicable
borrowing costs vide policy relating to borrowing costs.
(iii) Finished goods and stock-in-trade (in respect of goods acquired for trading) at lower of weighted
average cost or net realisable value. Cost includes costs of purchases, costs of conversion and other costs
incurred in bringing the inventories to their present location. Taxes which are subsequently recoverable from
taxation authorities are not included in the cost.
(iv) Completed property/work-in-progress (including land) in respect of property development activity at
lower of specifically identifiable cost or net realisable value."
"Assessment of net realisable value is made at each reporting period end and when the circumstances that
previously caused inventories to be written-down below cost no longer exist or when there is clear evidence
of an increase in net realisable value because of changed economic circumstances, the write-down, if
any, in the past period is reversed to the extent of the original amount written-down so that the resultant
carrying amount is the lower of the cost and the revised net realisable value.
J Finance Cost
Borrowing costs include exchange differences arising from foreign currency borrowings to the extent they
are regarded as an adjustment to the interest cost. Borrowing costs that are directly attributable to the
acquisition or construction of qualifying assets are capitalised as part of the cost of such assets. A qualifying
asset is one that necessarily takes substantial period of time to get ready for its intended use. Interest
income earned on the temporary investment of specific borrowings pending their expenditure on qualifying
assets is deducted from the borrowing costs eligible for capitalisation. All other borrowing costs are charged
to the Statement of Profit and Loss for the period for which they are incurred.
K Impairment of Non-Financial Assets - Property, Plant and Equipment and Intangible Assets
The Company assesses at each reporting date as to whether there is any indication that any Property, Plant
and Equipment and Intangible Assets or group of Assets, called Cash Generating Units (CGU) may be
impaired. If any such indication exists, the recoverable amount of an asset or CGU is estimated to determine
the extent of impairment, if any. When it is not possible to estimate the recoverable amount of an individual
asset, the Company estimates the recoverable amount of the CGU to which the asset belongs. An
impairment loss is recognised in the Statement of Profit and Loss to the extent, asset's carrying amount
exceeds its recoverable amount.
The recoverable amount is higher of an asset's fair value less cost of disposal and value in use. Value in use is
based on the estimated future cash flows, discounted to their present value using pre-tax discount rate that
reflects current market assessments of the time value of money and risk specific to the assets. The
impairment loss recognised in prior accounting period is reversed if there has been a change in the
estimate of recoverable amount.
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