2.1 Statement of Compliance

These financial statements have been prepared in accordance with the Indian Accounting Standards (referred
to as "Ind AS”) as prescribed under Section 133 of the Companies Act, 2013 read with Companies (Indian
Accounting Standards) Rules as amended from time to time.

2.2 Basis of Preparation

The financial statements have been prepared on a historical cost basis except for the following assets and
liabilities which have been measured at fair value:

a. Plan assets under defined benefit plans.

b. Certain financial assets and liabilities.

Historical cost is generally based on 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 or paid to transfer a liability in an orderly
transaction between market participants at the measurement date.

The financial information is presented in Indian Rupees (INR) and all values are rounded to the nearest lakhs,
expect where otherwise indicated.

2.3 Use of estimates and judgments

The preparation of the Company's financial statements requires management to make judgments, estimates
and assumptions that affect the reported amounts of revenue, expenses, assets and liabilities, and the
accompanying disclosures, and the disclosure of contingent liabilities. Uncertainty about these assumptions and
estimates could result in outcomes that require a material adjustment to the carrying amount of the asset or
liability affected in future periods.

Judgments

In the process of applying the Company's accounting policies, management has made the following judgments,
which have the most significant effect on the amounts recognized in the financial statements.

Estimates and assumptions

The key assumptions concerning the future and other key sources of estimation uncertainty at the reporting
date, that have a significant risk of causing a material adjustment to the carrying amounts of assets and
liabilities within the next financial year, are described below. The Company based its assumptions and
estimates on parameters available when the financial statements were prepared. Existing circumstances and
assumptions about future developments, however, may change due to market changes or circumstances arising
beyond the control of the Company. Such changes are reflected in the assumptions when they occur.

a. Taxes

Uncertainties exist with respect to the interpretation of complex tax regulations, changes in tax laws,
and the amount and timing of future taxable income. Given the wide range of business relationships
and the long term nature and complexity of existing contractual agreements, differences arising

between the actual results and the assumptions made, or future changes to such assumptions, could
necessitate future adjustments to tax income and expense already recorded. The Company establishes
provisions, based on reasonable estimates. The amount of such provisions is based on various factors,
such as experience of previous tax audits and differing interpretations of tax regulations by the taxable
entity and the responsible tax authority. Such differences of interpretation may arise on a wide variety
of issues depending on the conditions prevailing in the respective domicile of the companies.

b. Defined benefit plans

The cost of defined benefit plans (i.e. Gratuity benefit) is determined using actuarial valuations. An
actuarial valuation involves making various assumptions which may differ from actual developments
in the future. These include the determination of the discount rate, future salary increases, mortality
rates and future pension increases. Due to the complexity of the valuation, the underlying assumptions
and its long-term nature, a defined benefit obligation is highly sensitive to changes in these
assumptions. All assumptions are reviewed at each reporting date. In determining the appropriate
discount rate, management considers the interest rates of long term government bonds with
extrapolated maturity corresponding to the expected duration of the defined benefit obligation. The
mortality rate is based on publicly available mortality tables for the specific countries. Future salary
increases and pension increases are based on expected future inflation rates.

c. Fair value measurement of financial instrument

When the fair value of financial assets and financial liabilities recorded in the balance sheet cannot be
measured based on quoted prices in active markets, their fair value is measured using valuation
techniques including the Discounted Cash Flow (DCF) model. The inputs to these models are taken
from observable markets where possible, but where this is not feasible, a degree of judgement is
required in establishing fair values. Judgements include considerations of inputs such as liquidity risk,
credit risk and volatility. Changes in assumptions about these factors could affect the reported fair
value of financial instruments.

d. Useful lives of PPE:

The Company reviews the useful life of PPE at the end of each reporting period. This reassessment may

result in change in depreciation expense in future periods.

2.4 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:

Ý Expected to be realized or intended to be sold or consumed in normal operating cycle;

Ý Held primarily for the purpose of trading;

Ý Expected to be realized within twelve months after the reporting period, or

Ý 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:

Ý It is expected to be settled in normal operating cycle;

Ý It is held primarily for the purpose of trading;

Ý It is due to be settled within twelve months after the reporting period, or

Ý 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.

The operating cycle is the time between the acquisition of assets for processing and their realization in cash and

cash equivalents. The company has identified twelve months as its operating cycle.

2.5.1 Property, Plant & Equipment (PPE):

Property, Plant and Equipment including capital work in progress are initially measured at cost. The Company
has chosen to adopt cost model for subsequent measurement after initial recognition i.e. cost less accumulated
depreciation and accumulated impairment losses, if any. The cost comprises of purchase price, taxes, duties,
freight and other incidental expenses directly attributable and related to acquisition and installation of the
concerned assets and are further adjusted by the amount of GST credit availed wherever applicable. Cost
includes borrowing cost for long term construction projects if recognition criteria are met. When significant
parts of plant and equipment are required to be replaced at intervals, the Company depreciates them separately
based on their respective useful lives. Likewise, when a major inspection is performed, its cost is recognized in
the carrying amount of the plant and equipment as a replacement if the recognition criteria are satisfied. All
other repair and maintenance costs are recognized in profit or loss as incurred.

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.

Item such as spare parts, stand-by equipment and servicing equipment are recognized. When they meet the
definition of property, plant and equipment. Otherwise, such items are classified as inventory.

Capital work- in- progress includes cost of property, plant and equipment under installation / under
development as at the balance sheet date.

The residual values, useful lives and methods of depreciation of property, plant and equipment are reviewed at
each financial year end and adjusted prospectively, if appropriate.

In respect of others assets, depreciation is calculated on a straight-line basis using the rates arrived at based on
the useful lives estimated by the management and in the manner prescribed in Schedule II of the Companies Act
2013. The useful life is as follows:

An item of property, plant and equipment and any significant part initially recognized is derecognized upon
disposal or when no future economic benefits are expected from its use or disposal. Any gain or loss arising on
derecognition of the asset (calculated as the difference between the net disposal proceeds and the carrying
amount of the asset) is included in the income statement when the asset is derecognized.

2.5.2 Non-current assets held for sale

Recognized Non-current assets (or disposal groups) are classified as held for sale if their carrying amounts will
be recovered principally through a sale transaction rather than through continuing use.

Non-current assets (or disposal groups) classified as held for sale are measured at the lower of carrying amount
and fair value less cost to sell. Any impairment loss on initial classification and subsequent measurement is
recognized as an expense. Any subsequent increase in fair value less costs to sell (not exceeding the
accumulated impairment loss that has been previously recognized) is recognized in profit or loss.

Non-current assets classified as held for sale are presented separately from other assets in the balance sheet.
The non-current assets after being classified as held for sale are not depreciated or amortized.

Non-current assets (or disposal groups) that ceases to be classified as held for sale are measured at the lower of
its carrying amount before the asset (or disposal group) was classified as held for sale adjusted for any

depreciation, amortization or revaluations that would have been recognized had the asset (or disposal group)
not been classified as held for sale and its recoverable amount at the date of subsequent decision not to sell. Any
adjustment to the carrying amount of the non-current asset that ceases to be classified as held for sale is
charged to Statement of Profit or loss in the year in which there is a change in plan to sell the asset.

2.5.3 Investment Properties

Investment Properties is a property (land or a building- or a part of a building- or both) held (by the owner or
by the lessee as a right-of-use asset) to earn rentals or for capital appreciation or both, rather than for:

a) Use in the production or supply of goods or services or for administrative purposes, or

b) sale in the ordinary course of business.

Investment properties are measured initially at cost, including transaction costs. Subsequent to initial
recognition, investment properties are stated at cost less accumulated depreciation and accumulated
impairment loss, if any. The Company transfers a property to, or from, investment property when, and only
when, there is a change in use and the property meets or ceases to meets the definition of investment property
and there is an evidence of the change in use.

Investment properties are derecognized either when they have been disposed of or when they are permanently
withdrawn from use and no future economic benefit is expected from their disposal. The difference between
the net disposal proceeds and the carrying amount of the asset is recognized in profit or loss in the period of
derecognition.

2.5.4 Taxes:

2.5.4.1 Current Income Tax:

Current income tax assets and liabilities are measured at the amount expected to be recovered from or paid to
the taxation authorities in accordance with the Income Tax Act, 1961 (as amended) and Income Computation
and Disclosure Standards (ICDS) enacted in India by using the tax rates and tax laws that are enacted or
substantively enacted, at the reporting date in India where the Company operates and generates taxable
income.

Current income tax relating to items recognized outside profit or loss is recognized outside profit or loss (either
in other comprehensive income or in equity). Current tax items are recognized in correlation to the underlying
transaction relating to OCI & Equity either in OCI (Other Comprehensive Income) 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 establishes provisions where appropriate.

Deferred Tax:

Deferred tax is provided using the liability method on temporary differences between the tax basis of assets
and liabilities and their carrying amounts for financial reporting purposes at the reporting date.

Deferred tax liabilities are recognized for all taxable temporary differences, except:

Ý When the deferred tax liability arises from the initial recognition of goodwill or an asset or liability in a
transaction that is not a business combination and, at the time of the transaction, affects neither the
accounting profit nor taxable profit or loss;

Deferred tax assets are recognized for all deductible temporary differences, the carry forward of
unused tax credits and any unused tax losses. Deferred tax assets are recognized 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 utilized, except:

Ý When the deferred tax asset relating to the deductible temporary difference arises from the initial
recognition of an asset or liability in a transaction that is not a business combination and, at the time of
the transaction, affects neither the accounting profit nor taxable profit or loss

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 assets

to be utilized. Unrecognized deferred tax assets are re-assessed at each reporting date and are recognized 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 realized 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 relating to items recognized outside profit or loss is recognized outside profit or loss (either in
other comprehensive income or in equity). Deferred tax items are recognized in correlation to the underlying
transaction related to OCI & Equity either in OCI or directly in equity.

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.

Goods & Service Tax (GST) on acquisition of assets or on incurring expenses:

Expenses and assets are recognized net of the amount of GST paid, except:

Ý When the tax incurred on a purchase of assets or services is not recoverable from the taxation
authority, in which case, the tax paid is recognized as part of the cost of acquisition of the asset or as
part of the expense item, as applicable

Ý When receivables and payables are stated with the amount of tax included

The net amount of tax recoverable from, or payable to, the taxation authority is included as part of
other current assets or other current liabilities in the balance sheet.

2.5.5 Inventories

Inventories (other than by-products) are valued at the lower of cost and net realisable value.

Costs incurred in bringing each product to its present location and conditions are accounted for as follows:

Ý Raw materials/ Stores & Spares: 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.

Ý 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.

Ý By-products and scraps are valued at net realizable value.

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.

2.5.6 Investments in Associates

The Company's investments in its associates are accounted for using the equity method. Under the equity
method, the investment in associates is initially recognized at cost. The carrying amount of the investment is
adjusted to recognise changes in the Company's share of net assets of the associate since the acquisition date. If
the Company's share of the net fair value of the investee's identifiable assets and liabilities exceeds the cost of
the investment, any excess is recognized directly in Equity as capital reserve in the period in which the
investment is acquired. Goodwill, if any, relating to the associate is included in the carrying amount of the
investment and is not tested for impairment.

2.5.7 Intangible assets

a. Purchased Intangible assets are measured at cost as at the date of acquisition, less accumulated
amortization and impairment losses if any.

For this purpose, cost includes deemed cost on the date of transition and acquisition price, license fees,
non-refundable taxes and costs of implementation/ system integration services and any directly
attributable expenses, wherever applicable for bringing the asset to its working condition for the
intended use.

b. Amortization methods, estimated useful lives and residual value

Intangible assets are amortized on a straight-line basis (without keeping any residual value) over its
estimated useful lives of five years from the date they are available for use.

The estimated useful lives, residual values and amortization method are reviewed at the end of each
financial year and are given effect to, wherever appropriate.

c. The cost and related accumulated amortization are eliminated from the financial statements upon sale
or retirement of the asset and the resultant gains or losses are recognized in the statement of profit and
loss

2.5.8 Financial Instruments:

A financial instrument is any contract that gives rise to a financial asset of one entity and a financial liability or
equity instrument of another entity.

a. Financial Assets:

The Company classified its financial assets in the following measurement categories:

Ý Those to be measured subsequently at fair value (either through other comprehensive income or
through profit & loss)

Ý Those measured at amortized cost
Initial recognition and measurement:

All financial assets are recognized initially at fair value plus, in the case of financial assets not recorded at fair
value through profit or loss, transaction costs that are attributable to the acquisition of the financial asset.
Purchases or sales of financial assets that require delivery of assets within a time frame established by
regulation or convention in the market place (regular way trades) are recognized on the trade date, i.e., the date
that the Company commits to purchase or sell the asset.

Subsequent measurement:

For purposes of subsequent measurement, financial assets are classified in following categories:

Ý Debt instruments at amortized cost

A 'debt instrument' is measured at the amortized cost if both the following conditions are met:

a. Business model test: The asset is held within a business model whose objective is to hold assets for
collecting contractual cash flows (rather than to sell the instrument prior to its contractual maturity to
realise its fair value changes), and

b. Cash flow characteristics test: Contractual terms of the asset give rise on specified dates to cash flows
that are solely payments of principal and interest (SPPI) on the principal amount outstanding.

This category is the most relevant to the Company. After initial measurement, such financial assets are
subsequently measured at amortized cost using the effective interest rate (EIR) method. Amortized cost is
calculated by taking into account any discount or premium on acquisition and fees or costs that are an integral
part of the EIR. EIR is the rate that exactly discounts the estimated future cash receipts over the expected life of

the financial instrument or a shorter period, where appropriate to the gross carrying amount of financial assets.
When calculating the effective interest rate the Company estimates the expected cash flow by considering all
contractual terms of the financial instruments. The EIR amortization is included in finance income in the profit
or loss. The losses arising from impairment are recognized in the profit or loss. This category generally applies
to trade and other receivables.

Ý Debt instruments, derivatives and equity instruments at fair value through profit or loss (FVTPL)

FVTPL is a residual category for financial instruments. Any financial instrument, which does not meet the
criteria for amortized cost or FVTOCI (Fair value through Other Comprehensive Income), is classified as at
FVTPL. A gain or loss on a Debt instrument that is subsequently measured at FVTPL and is not a part of a
hedging relationship is recognized in statement of profit or loss and presented net in the statement of profit and
loss within other gains or losses in the period in which it arises. Interest income from these Debt instruments is
included in other income.

Derecognition:

A financial asset (or, where applicable, a part of a financial asset or part of a Company of similar financial
assets) is primarily derecognized (i.e., removed from the Company's statement of financial position) when:

a. the rights to receive cash flows from the asset have expired, or

b. 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;

I. the Company has transferred the rights to receive cash flows from the financial assets or

II. the Company has retained the contractual right to receive the cash flows of the financial asset, but
assumes a contractual obligation to pay the cash flows to one or more recipients.

Where the Company has transferred an asset, the Company evaluates whether it has transferred substantially
all the risks and rewards of the ownership of the financial assets. In such cases, the financial asset is
derecognized. Where the entity has not transferred substantially all the risks and rewards of the ownership of
the financial assets, the financial asset is not derecognized.

Where the Company has neither transferred a financial asset nor retains substantially all risks and rewards of
ownership of the financial asset, the financial asset is derecognized if the Company has not retained control of
the financial asset. Where the Company retains control of the financial asset, the asset is continued to be
recognized to the extent of continuing involvement in the financial asset.

Impairment of financial assets:

In accordance with Ind AS 109, the Company applies expected credit losses (ECL) model for measurement and
recognition of impairment loss on the following financial asset and credit risk exposure

Financial assets measured at amortised cost e.g. Loans, security deposits, trade receivable, bank balance.

The Company follows "simplified approach” for recognition of impairment loss allowance on trade receivables.
Under the simplified approach, the Company does not track changes in credit risk. Rather, it recognizes
impairment loss allowance based on lifetime ECLs at each reporting date, right from its initial recognition. The
Company uses a provision matrix to determine impairment loss allowance on the portfolio of trade receivables.
The provision matrix is based on its historically observed default rates over the expected life of trade receivable
and is adjusted for forward looking estimates. At every reporting date, the historical observed default rates are
updated and changes in the forward looking estimates are analyzed.

For recognition of impairment loss on other financial assets and risk exposure, the Company determines
whether there has been a significant increase in the credit risk since initial recognition. If credit risk has not
increased significantly, 12-month ECL is used to provide for impairment loss. However, if credit risk has
increased significantly, lifetime ECL is used. If, in subsequent period, credit quality of the instrument improves
such that there is no longer a significant increase in credit risk since initial recognition, then the Company
reverts to recognizing impairment loss allowance based on 12- months ECL.

As a practical expedient, the Company uses a provision matrix to determine impairment loss allowance on
portfolio of trade receivables. The provision matrix is based on its historically observed default rates over the
expected life of the trade receivables and is adjusted for forward-looking estimates. At every reporting date, the
historical observed default rates are updated and changes in the forward-looking estimates are analysed.

Reclassification of financial assets:

The Company determines classification of financial assets and liabilities on initial recognition. After initial
recognition, no reclassification is made for financial assets which are equity instruments and financial liabilities.
For financial assets which are debt instruments, a reclassification is made only if there is a change in the
business model for managing those assets. Changes to the business model are expected to be infrequent. The
Company's senior management determines change in the business model as a result of external or internal
changes which are significant to the Company's operations. Such changes are evident to external parties. A
change in the business model occurs when the Company either begins or ceases to perform an activity that is
significant to its operations. If the Company reclassifies financial assets, it applies the reclassification
prospectively from the reclassification date which is the first day of the immediately next reporting period
following the change in business model. The Company does not restate any previously recognized gains, losses
(including impairment gains or losses) or interest.

b. Financial Liabilities:

Initial recognition and measurement:

Financial liabilities are classified at initial recognition as financial liabilities at fair value through profit
or loss, loans and borrowings, and payables, net of directly attributable transaction costs. The Company
financial liabilities include loans and borrowings including bank overdraft, trade payable, trade
deposits and other payables.

Subsequent measurement:

The measurement of financial liabilities depends on their classification, as described below:

Trade Payables:

These amounts represent liabilities for goods and services provided to the Company prior to the end of
financial year which are unpaid. The amounts are unsecured and are usually paid within 0-180 days of
recognition. Trade and other payables are presented as current liabilities unless payment is not due within 12
months after the reporting period. They are recognized initially at fair value and subsequently measured at
amortised cost using EIR method.

Financial Liabilities at fair value through profit & loss:

Financial liabilities at fair value through profit or loss include financial liabilities held for trading and financial
liabilities designated upon initial recognition as at fair value through profit or loss. Financial liabilities are
classified as held for trading if they are incurred for the purpose of repurchasing in the near term. Gains or
losses on liabilities held for trading are recognized in the statement of profit and loss. Financial liabilities
designated upon initial recognition at fair value through profit or loss are designated as such at the initial date
of recognition, and only if the criteria in IND AS 109 are satisfied. For liabilities designated as FVTPL, fair value
gains/ losses attributable to changes in own credit risk is recognized in OCI. These gains/ losses are not
subsequently transferred to profit and loss. However, the Company may transfer the cumulative gain or loss
within equity. All other changes in fair value of such liability are recognized in the statement of profit or loss.

Loans & Borrowings:

Borrowings are initially recognized at fair value, net of transaction cost incurred. After initial recognition,
interest-bearing loans and borrowings are subsequently measured at amortised cost using the EIR (Effective
Interest Rate) method. Gains and losses are recognized in profit or loss when the liabilities are derecognized as
well as through the EIR amortization process. Amortised cost is calculated by taking into account any discount
or premium on acquisition and fees or costs that are an integral part of the EIR. The EIR amortization is
included as finance costs in the statement of profit and loss.

Derecognition:

A financial liability is derecognized when the obligation under the liability is discharged or cancelled or expires.
When an existing financial liability is replaced by another from the same lender on substantially different
terms, or the terms of an existing liability are substantially modified, such an exchange or modification is
treated as the derecognition of the original liability and the recognition of a new liability. The difference in the
respective carrying amounts is recognized in the statement of profit and loss.

Offsetting of financial instruments:

Financial assets and financial liabilities are offset and the net amount is reported in the balance sheet if there is
a currently enforceable legal right to offset the recognized amounts and there is an intention to settle on a net
basis, to realize the assets and settle the liabilities simultaneously.

2.5.9 Cash & Cash Equivalents:

Cash and cash equivalents in the balance sheet comprise cash at banks; cash in hand, other short term deposits
with original maturities of three months or less which are subject to an insignificant risk of changes in value.

2.5.10 Mandatorily Redeemable Preference Shares:

A mandatorily redeemable preference shares with dividends paid at the issuer's discretion, which effectively
comprises: a financial liability (the issuer's obligation to redeem the shares in cash); and an equity instrument
(the holder's right to receive dividends if declared). Such preference shares are separated into liability and
equity components based on the terms of the contract.

On issuance of the mandatorily redeemable preference shares with dividends declared at the issuer's
discretion, the present value of the redeemable amount is calculated using a market rate for an equivalent non¬
convertible instrument. This amount is classified as a financial liability measured at amortized cost (net of
transaction costs) until it is extinguished on redemption. The unwinding of the discount on this component is
recognized in profit or loss and classified as interest expense.

The remainder of the proceeds is recognized and included in equity as per Ind AS 32. Transaction costs are
deducted from equity, net of associated income tax. The carrying amount of the equity component is not
remeasured in subsequent years.

Transaction costs are apportioned between the liability and equity components of such preference shares
based on the allocation of proceeds to the liability and equity components when the instruments are initially
recognized.