D SUMMARY OF MATERIAL ACCOUNTING POLICY

INFORMATION

(i) Functional and presentation currency

Items included in the standalone financial
statements of the Company are measured using
the currency of the primary economic environment
in which the Company operates (i.e., the “functional
currency”). The standalone financial statements
are presented in INR, which is the functional and
presentation currency of the Company.

(ii) Foreign currency transactions and translations
Foreign currency transactions of the Company
are accounted at the exchange rates prevailing on
the date of the transaction. Monetary assets and
liabilities are translated at the rate prevailing on
the balance sheet date whereas non-monetary

assets and liabilities are translated at the rate
prevailing on the date of the transaction. Gains
and losses resulting from the settlement of foreign
currency monetary items and from the translation
of monetary assets and liabilities denominated in
foreign currencies are recognised in the standalone
statement of profit and loss.

(iii) Financial instruments

a. Initial recognition and measurement

The Company recognises financial assets
and liabilities when it becomes a party to
the contractual provisions of the instrument.
Financial assets (except trade receivables
and contract assets) and financial liabilities
are recognised at fair value on initial
recognition. Transaction costs that are
directly attributable to the acquisition or
issue of financial assets and liabilities that
are not at fair value through profit or loss are
added to the fair value on initial recognition.
Regular purchase and sale of financial assets
are recognised on the trade date. Further,
trade receivables and contract assets are
measured at transaction price on initial
recognition.

b. Subsequent measurement

Non derivative financial instruments

(a) Financial assets carried at
amortised cost

A financial asset is subsequently
measured at amortised cost if it is
held within a business model whose
objective is to hold the asset in order
to collect contractual cash flows and
the contractual terms of the financial
asset give rise on specified dates to
cash flows that are solely payments of
principal and interest on the principal
amount outstanding.

(b) Financial assets at fair value
through other comprehensive
income (‘FVOCI’)

A financial asset is subsequently
measured at FVOCI if it is held within
a business model whose objective
is achieved by both collecting
contractual cash flows and selling
financial assets and the contractual
terms of the financial asset give rise

on specified dates to cash flows
that are solely payments of principal
and interest on the principal amount
outstanding.

(c) Financial assets at fair value
through profit or loss (‘FVTPL’)

A financial asset which is not classified
in any of the above categories are
subsequently fair valued through profit
or loss.

(d) Financial liabilities

Financial liabilities are subsequently
carried at amortised cost using the
effective interest method. For trade
and other payables maturing within
one year from the balance sheet date,
the carrying amounts approximate fair
value due to the short maturity of these
instruments.

The Company’s policy is to recognise
transfers into and transfers out of fair
value hierarchy levels as at the end of
the reporting period.

Derivative instruments
The Company holds derivative financial
instruments i.e., foreign exchange forward
contracts, to mitigate the risk of changes
in exchange rates on foreign currency
exposures. The counterparty for these
contracts is generally a bank. No hedge
accounting is applied to these instruments,
which are carried at fair value with changes
being recognised in the standalone statement
of profit and loss.

Compound financial instruments

Preference shares, which are non-convertible
and redeemable on a specific date, are
classifiedascompoundfinancialinstruments.
The fair value of the asset portion is
determined using a market interest rate.
This amount is recorded as a asset on an
amortised cost basis until extinguished on
redemption of the preference shares. The
remainder of the proceeds is attributable
to the equity component of the compound
instrument. This is recognised and included
in deemed equity investment, net of income
tax effects, and not subsequently measured.

c. De-recognition of financial instruments

The Company derecognises a financial asset
when the contractual right to receive the
cash flows from the financial asset expire
or it transfers the financial asset. A financial
liability is derecognised when the obligation
under the liability is discharged, cancelled or
expires.

d. Offsetting financial instruments

Financial assets and liabilities are offset and
the net amount is reported in the balance
sheet where there is a legally enforceable
right to offset the recognised amounts and
there is an intention to settle on a net basis
or realise the asset and settle the liability
simultaneously. The legally enforceable right
must not be contingent on future events and
must be enforceable in the normal course
of business and in the event of default,
insolvency or bankruptcy of the group or the
counterparty.

(iv) Current versus non-current classification

(i) An asset is considered as current when it is:

a. Expected to be realised or intended
to be sold or consumed in the normal
operating cycle, or

b. Held primarily for the purpose of
trading, or

c. Expected to be realised within twelve
months after the reporting period, or

d. Cash or cash equivalents unless
restricted from being exchanged or
used to settle a liability for at least
twelve months after the reporting
period.

(ii) AH other assets are classified as non-current.

(iii) Liability is considered as current when it is:

a. Expected to be settled in the normal
operating cycle, or

b. Held primarily for the purpose of
trading, or

c. Due to be settled within twelve months
after the reporting period, or

d. There is no unconditional right to defer
the settlement of the liability for at
least twelve months after the reporting
period.

(iv) AH other liabilities are classified as non¬
current.

(v) Deferred tax assets and liabilities are
classified as non-current assets and
liabilities.

(vi) All assets and liabilities have been classified
as current or non-current as per the
Company’s operating cycle and other criteria
set out in Schedule III to the Act. Based on
the nature of products and services and
the time between the acquisition of assets
for processing and their realisation in cash
and cash equivalents, the Company has
ascertained its operating cycle as twelve
months for the purpose of current and non¬
current classification of assets and liabilities.

(v) Property, plant and equipment (‘PPE’)

The cost of PPE as at the Company’s date
of transition to Ind AS, was determined with
reference to its carrying value recognised as
per the previous GAAP (deemed cost).

PPE (other than freehold land) are stated
at historical cost, less accumulated
depreciation and impairment losses, if
any. Historical costs include expenditure
directly attributable to acquisition which
are capitalised until the PPE are ready for
use, as intended by management, including
non refundable taxes. Any trade discount
and rebates are deducted in arriving at the
purchase price.

An item of PPE initially recognised is de¬
recognised upon disposal or when no future
economic benefits are expected from its
use or disposal. Gains or losses arising
from disposals of assets are measured as
the difference between the net disposal
proceeds and the carrying value of the asset
on the date of disposal and are recognised in
the standalone statement of profit and loss,
in the period of disposal.

The cost of an item of PPE shall be recognised
as an asset if, and only if:

(a) it is probable that future economic benefits
associated with the item will flow to the
Company; and

(b) the cost of the item can be measured reliably.
Items such as spare parts are recognised as
PPE when they meet the definition of PPE.
Otherwise, such items are classified as
inventory.

rata from the month of such addition or up to
the month of such disposal as the case may
be. The residual values are not more than 5%
of the original cost of the asset.

Capital work-in-progress includes PPE under
construction and not ready for intended use
as on the balance sheet date.

Capital Work-in-progress includes
expenditure incurred till the assets are put
into intended use.

Capital Work-in-Progress are measured at
cost less accumulated impairment losses, if
any.

(vi) Investment properties

Property that is held for long-term rental yields
or for capital appreciation or both, and that is
not occupied by the Company, is classified as
investment properties. Investment property is
measured initially at its cost, including related
transaction costs and borrowing costs where
applicable. Subsequent expenditure is
capitalised to the asset’s carrying amount
only when it is probable that future economic
benefits associated with the expenditure will
flow to the Company and the cost of the item
can be measured reliably.

Transfers to (or from) investment property
are made only when there is a change in
use. Transfers between investment property,
owner-occupied property and inventories
do not change the carrying amount of the
property transferred and they do not change
the cost of that property for measurement or
disclosure purposes.

The cost of investment properties as at the
Company’s date of transition to Ind AS, was
determined with reference to its carrying
value recognised as per the previous GAAP
(deemed cost).

Investment properties are depreciated using
the WDV method over their estimated useful
lives. Useful life considered for calculation of
depreciation for investment properties is as
follows:

(vii) Intangible assets

Intangible assets acquired separately are
initially recognised at cost of acquisition
which includes purchase price including
import duties and non-refundable taxes, if any

and further includes directly attributable cost
of preparing the asset for its intended use.
Identifiable intangible assets are recognised
when it is probable that future economic
benefits attributed to the asset will flow to
the Company and the cost of the asset can
be reliably measured. Computer software is
amortised on a SLM basis over the estimated
useful economic life which is expected as 3
years. Following initial recognition, intangible
assets are carried at cost less accumulated
amortisation and impairment losses, if any.
The amortisation of an intangible asset with
a finite useful life reflects the manner in
which the economic benefit is expected to
be generated. The estimated useful life of
amortisable intangibles are reviewed and
where appropriate are adjusted, annually.

An item of intangible asset initially recognised
is de-recognised upon disposal or when no
future economic benefits are expected from
its use or disposal. Gains or losses arising
from derecognition of an intangible asset
are measured as the difference between
the net disposal proceeds and the carrying
amount of the asset on the date of disposal
and are recognised in the standalone
statement of profit and loss when the asset is
derecognised.

Amortisation on addition to intangible
assets or on disposal of intangible assets is
calculated pro-rata from the month of such
addition or up to the month of such disposal
as the case may be.

Intangible assets under development are
initially measured at cost. Such intangible
assets are subsequently measured at
cost less accumulated amortisation and
impairment losses, if any.

(viii) Leases

The determination of whether an
arrangement is (or contains) a lease is based
on the substance of the arrangement at the
inception of the lease. The arrangement
is, or contains, a lease if fulfilment of the
arrangement is dependent on the use of a
specific asset or assets and the arrangement
conveys a right to use the asset or assets,
even if that right is not explicitly specified in
an arrangement.

Company as a lessee

The Company’s lease asset class consists
of leases for land and buildings (retail stores
and warehouses). The Company assesses
whether a contract contains a lease, at
inception of a contract. A contract is, or
contains, a lease 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.

At the date of commencement of the lease,
the Company recognises a right of use
(‘ROU’) asset and a corresponding lease
liability for all lease arrangements in which
it is a lessee, except for leases with a term
of twelve months or less (short-term leases)
and leases of low value assets. For these
short-term and leases of low value assets,
the Company recognises the lease payments
as an operating expense on a straight-line
basis over the term of the lease.

Lease arrangements may include the options
to extend or terminate the lease before
the end of the lease term. ROU assets and
lease liabilities includes these options
when it is reasonably certain that they will
be exercised. The ROU assets are initially
recognised at cost, which comprises the
initial amount of the lease liability adjusted
for any lease payments made at or prior to the
commencement date of the lease plus any
initial direct costs less any lease incentives.
They are subsequently measured at cost less
accumulated depreciation and impairment
losses, if any.

ROU assets are depreciated from the
commencement date on a straight-line basis
over the shorter of the lease term and useful
life of the underlying asset. ROU assets
are evaluated for recoverability whenever

events or changes in circumstances indicate
that their carrying amounts may not be
recoverable. For the purpose of impairment
testing, the recoverable amount (i.e., the
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.

The lease liability is initially measured at
amortised cost at the present value of the
future lease payments. The lease payments
are discounted using the interest rate implicit
in the lease or, if not readily determinable,
using the incremental borrowing rates in the
country of domicile of these leases.

Lease liabilities are remeasured with a
corresponding adjustment to the related ROU
asset if the Company changes its assessment
on whether it will exercise an extension or
a termination option. Lease liabilities and
ROU assets have been separately presented
in the standalone balance sheet and lease
payments have been classified as financing
cash flows.

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 ROU asset arising from
the head lease. For operating leases, rental
income is recognised on a straight-line
basis over the term of the relevant lease.
For operating leases, rental income is
recognised on a straight-line basis over the
term of the relevant lease. Contingent rents
are recognised as revenue in the period in
which they are earned.

(ix) Impairment of assets

(a) Non-financial assets

Intangible assets, ROU assets and PPE
are evaluated for recoverability whenever
events or changes in circumstances indicate
that their carrying amounts may not be
recoverable. For the purpose of impairment
testing, the recoverable amount (i.e., the
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 CGU to which the asset
belongs.

If such assets are considered to be
impaired, the impairment to be recognised
in the standalone statement of profit and
loss is measured by the amount by which
the carrying value of the assets exceeds
the estimated recoverable amount of the
asset. An impairment loss is reversed in the
standalone statement of profit and loss if
there has been a change in the estimates
used to determine the recoverable amount.
The carrying amount of the asset is increased
to its revised recoverable amount, provided
that this amount does not exceed the carrying
amount that would have been determined
(net of any accumulated amortisation or
depreciation) had no impairment loss been
recognised for the asset in prior years. For
impairment of inventory, refer accounting
policy of “Inventories”.

(b) Financial assets

The Company assesses at each date of
balance sheet whether a financial asset or
a group of financial assets is impaired. Ind
AS 109 “Financial Instruments” requires
expected credit losses to be measured
through a loss allowance. The Company
recognises lifetime expected losses for all
trade receivables and contract assets that
do not constitute a financing component.
In determining the loss allowances for
trade receivables and contract assets, the
Company has used a practical expedient
by computing the expected credit loss
allowance for trade receivables and contract

assets based on a provision matrix. The
provision matrix takes into account historical
credit loss experience and is adjusted for
forward-looking information. The expected
loss allowance is based on the ageing of the
receivables that are due and allowance rates
used in the provision matrix. For all other
financial assets, expected loss allowance
are measured at an amount equal to the
12-months expected credit losses or at an
amount equal to the lifetime credit losses
if the credit risk on the financial asset
has increased significantly since initial
recognition.

When determining whether the credit risk of
a financial asset has increased significantly
since initial recognition, the Company
considers reasonable and supportable
information that is relevant and available
without undue cost or effort. This includes
both quantitative and qualitative information
and analysis, based on the Company’s
historical experience and informed credit
assessment, that includes forward looking
information.

The Company assumes that the credit risk on
a financial asset has increased significantly
if it is more than 60 days past due (inclusive
of additional 30 days over and above 30 days
rebuttable presumption, where the delay
could be due to administrative oversight
which is considered normal in the industry
and/ or geographies where Company is
operating).

For impairment of investment in
subsidiaries, associates and joint ventures,
refer accounting policy of “Investment in
subsidiary, associate and joint venture”.

(x) Investment in subsidiary, associate and
joint venture

Investment in subsidiary, associate and joint
venture is carried at cost less accumulated
impairment losses, if any. Where an indication
of impairment exists, the carrying amount of
the investment is assessed and written down
immediately to its recoverable amount. On
disposal of investment in subsidiary, the
difference between net disposal proceeds
and the carrying amounts are recognised in
the standalone statement of profit and loss.

(xi) Employee benefits

a. Long-term employee benefits

Defined contribution plan

The Company has defined contribution
plan for post employment benefits in the
form of provident fund, employees’ state
insurance and labour welfare fund. Under
the defined contribution plan, the Company
has no further obligation beyond making
the contributions. Such contributions are
charged to the standalone statement of profit
and loss as incurred.

Defined benefit plan
Gratuity and pension
The Company has defined benefit plan
for post employment benefits in the form
of gratuity and pension for its employees
in India. Liability for defined benefit plan
is provided on the basis of actuarial
valuations, as at the balance sheet date,
carried out by an independent actuary.
The actuarial valuation method used by
independent actuary for measuring the
liability is the projected unit credit method.
Actuarial gains or losses are recognised
in Other Comprehensive Income (‘OCI’).
Further, the profit or loss does not include an
expected return on plan assets. Instead net
interest recognised in standalone statement
of profit and loss is calculated by applying the
discount rate used to measure the defined
benefit obligation to the net defined benefit
liability or asset. The actual return on the plan
assets above or below the discount rate is
recognised as part of remeasurement of net
defined benefit liability or asset through OCI.
Remeasurement comprising of actuarial
gains or losses and return on plan assets
(excluding amounts included in net interest
on the net defined benefit liability or asset)
are not reclassified to standalone statement
of profit and loss in subsequent periods.
Provident fund

In accordance with the Employees’ Provident
Fund and Miscellaneous Provision Act,
1952, for certain eligible employees of the
Company are entitled to receive benefits
under the provident fund plan in which both

the employee and employer (at a determined
rate) contribute monthly to “Raymond
Limited Employee’s Provident Fund Trust”, a
Trust set up by the Company to manage the
investments and distribute the amounts to
employees at the time of separation from the
Company or retirement, whichever is earlier.
This plan is a defined obligation plan as the
Company is obligated to provide its members
a rate of return which should, at a minimum,
meet the interest rate declared by government
administered provident fund. A part of the
Company’s contribution is transferred to
government-administered pension fund. The
contributions made by the Company and the
shortfall of interest, if any, are recognised as
an expense in the statement of profit and loss
under “Employee benefits expense”.

Other long-term employee benefits
The employees of the Company are also
entitled to other long-term employee benefits
in the form of compensated absences as per
the policy of the Company. Accumulated
leave, which is expected to be utilised
within the next twelve months, is treated as
short-term employee benefit. The Company
measures the expected cost of such absences
as the additional amount that it expects to
pay as a result of the unused entitlement
that has accumulated at the reporting date.
The Company treats accumulated leave
expected to be carried forward beyond
twelve months, as long term employee
benefit for measurement purposes. In case
of compensated absences, the Company
does not have an unconditional right to defer
settlement for any of these obligations. Thus,
compensated absences are provided for
based on the actuarial valuation using the
projected unit credit method at the year end.
Actuarial gains and loss are recognised in
the standalone statement of profit and loss
during the period in which they arise.

b. Short-term employee benefits

The undiscounted amount of short-term
employee benefits expected to be paid
in exchange for the services rendered
by employees is recognised in the year
during which the employee rendered the
services. These benefits include salary and
performance incentives etc.

c. Termination benefits

Termination benefits are payable when
employment is terminated by the Company
before the normal retirement date, or when
an employee accepts voluntary redundancy
in exchange for these benefits. The Company
recognises termination benefits at the
earlier of the following dates: (a) when the
Company can no longer withdraw the offer
of those benefits; and (b) when the Company
recognises costs for a restructuring that is
within the scope of Ind AS 37 “Provision,
Contingent Liabilities and Contingent Assets”
and involves the payment of terminations
benefits. In the case of an offer made to
encourage voluntary redundancy, the
termination benefits are measured based on
the number of employees expected to accept
the offer. Benefits falling due more than 12
months after the end of the reporting period
are discounted to present value.

(xii) Share based payments

Share-based compensation benefits are
provided to employees via “Raymond
Employee Stock Option Plan 2023” (ESOP
scheme). The fair value of options granted
under the ESOP scheme is recognised
as an employee benefits expense with a
corresponding increase in equity. The total
amount to be expensed is determined by
reference to the fair value of the options
granted:

• including any market performance
conditions (e.g., the entity’s share
price)

• excluding the impact of any service
and non-market performance vesting
conditions (e.g., profitability, sales
growth targets and remaining an
employee of the entity over a specified
time period), and

• including the impact of any non-vesting
conditions (e.g., the requirement for
employees to serve or hold shares for
a specific period of time).

The total expense is recognised over the
vesting period, which is the period over which
all of the specified vesting conditions are to
be satisfied.

The Company has created a Raymond
Limited ESOP Trust for implementation of the
said ESOP scheme. The Company treats the
ESOP trust as its extension and shares held
by ESOP Trust are treated as treasury shares.
The Company determines the compensation
cost based on the fair value method using
Black-Scholes-Merton formula and Monte
Carlo Simulation model, in accordance with
Ind AS 102 “Share-based Payment”. The
Company grants options to its employees
which will be vested in a graded manner
and are to be exercised within a specified
period. The compensation cost is amortised
on graded basis over the vesting period. The
share based payment expense is determined
based on the Company’s estimate of equity
instrument that will eventually vest.

The amounts recognised in “Share options
outstanding account” are transferred to
share capital and securities premium upon
exercise of stock options by employees.
Where employee stock options lapse
after vesting, an amount equivalent to the
cumulative cost for the lapsed option is
transferred from “Share options outstanding
account” to “General reserve”.