1. CORPORATE INFORMATION
The Ruby Mills limited (‘RML’ or ‘the Company’) is a public limited company domiciled in India incorporated
on 9th January 1917. Registered office of the Company is located at Mumbai. The Company is listed on the
Bombay Stock Exchange Limited and the National Stock Exchange of India Limited. The Company is an
integrated textile mill.
The Company has two plants. The spinning and weaving plant is located at Dhamni and the process house at
Kharsundi both at Khopoli close to Bombay - Pune Highway.
The Company had entered into a Development Agreement ("the DA”) to develop part of its vacant mill land at
Dadar. In terms of the DA, any cost of construction incurred by the Company for the development of the above
is to be reimbursed by the Developer. The consideration for the Grant of the Development Rights is based on
the specified percentage of the revenue received by the Developer.
2. BASIS OF PREPARATION AND SIGNIFICANT ACCOUNTING POLICIES:
2.1. Basis for preparation and presentation:
The financial statements comply with Indian Accounting Standards (‘Ind AS’) notified under Section 133 of the
Companies Act, 2013 (‘Act’) read with Companies (Indian Accounting Standards) Rules, 2015, as amended and
other relevant provisions of the Act and Rules thereunder.
The financial statements have been prepared on accrual basis and in accordance with the historical cost
convention except for certain assets and liabilities measured at fair value.The accounting policies are applied
consistently to all the periods presented in the financial statements.
All assets and liabilities have been classified as current or non-current as per the Company’s normal operating
cycle, paragraph 66 and 69 of Ind AS 1 and other criteria as set out in the Division II of Schedule III to the Act.
Based on the nature of products and the time between acquisition of assets for processing and their realisation
in cash and cash equivalents, the Company has ascertained its operating cycle as 12 months for the purpose
of current or non-current classification of assets and liabilities. Deferred tax assets and liabilities are classified
as non-current assets and liabilities.
The financial statements are presented in Indian Rupee (INR), which is the functional currency of the Company.
All amounts disclosed in the Financial Statements and notes have been rounded off to the nearest lakhs ,
unless otherwise stated.
The Financial Statements of the Company for the year ended 31st March, 2025 were approved for issue in
accordance with a resolution of the Board of Directors in its meeting held on 26th May, 2025.
2.2. Use of Judgement and Estimates
The preparation of the financial statements require management to make judgments, estimates and assumptions
that affect the reported amounts of revenue, expenses, assets, liabilities and accompanying disclosures.
Uncertainty about these assumptions and estimates could result in outcomes that require material adjustments
to the carrying amount of assets or liabilities affected in future periods. The Company continually evaluates
these estimates and assumptions based on the most recently available information.
In particular, information about significant areas of estimates and judgements in applying accounting policies
that have the most significant effect on the amounts recognised in the financial statements are as below:
• Estimates of useful lives and residual value of Property, Plant and Equipment and intangible assets;
• Measurement of Defined Benefit Obligations;
• Measurement and likelihood of occurrence of Provisions and contingencies;
• Recognition of deferred tax assets;
• Measurement of recoverable amounts of cash-generating units;
• Measurement of Right of Use Assets and Lease liabilities;
• Valuation of Inventories;
• Provision for loss allowances;
• Fair value measurement of financial instruments.
Revisions to accounting estimates are recognised prospectively.
2.3. Property, plant and equipment
2.3.1. Property, plant and equipment are stated at cost net of accumulated depreciation and accumulated
impairment losses, if any;
2.3.2. The initial cost of an asset comprises its purchase price or construction cost (including import duties and
non-refundable taxes), any costs directly attributable to bringing the asset into the location and condition
necessary for it to be capable of operating in the manner intended by management, the initial estimate of
any decommissioning obligation, if any, and, borrowing cost for qualifying assets (i.e. assets that necessarily
take a substantial period of time to get ready for their intended use);
2.3.3. Subsequent expenditure is capitalised only if it probable that the future economic benefits associated with
the expenditure will flow to the Company;
2.3.4. Spare parts which meet the definition of Property, Plant and Equipment are capitalised as Property, Plant
and Equipment in case the unit value of the spare part is above the threshold limit. In other cases, the spare
part is inventorised on procurement and charged to Statement of Profit and Loss on consumption;
2.3.5. An item of property, plant and equipment and any significant part initially recognised separately as part
of property, plant and equipment is derecognised upon disposal; or when no future economic benefits are
expected from its use or disposal. Any gain or loss arising on de-recognition of the asset is included in the
Statement of Profit and Loss when the asset is derecognised;
2.3.6. The residual values and useful lives of property, plant and equipment are reviewed at each financial year end
and changes, if any, are accounted in the line with revisions to accounting estimates;
2.3.7. Property, plant and equipment which are not ready for intended use as on date of Balance Sheet are
disclosed as "Capital work - in - progress”;
2.3.8. Depreciation is provided on a pro-rata basis on the straight-line method for plant and machinery and for all
other assets on written down value method (after retaining the estimated residual value upto 5%) based on
estimated useful life prescribed under Schedule II to the Act;
2.3.9. Components of the main asset that are significant in value and have different useful lives as compared to
the main asset are depreciated over their estimated useful life. Useful life of such components has been
assessed based on historical experience and internal technical assessment;
2.3.10. Depreciation on spare parts specific to an item of property, plant and equipment is based on life of the
related property, plant and equipment. In other cases, the spare parts are depreciated over their estimated
useful life based on the technical assessment;
2.3.11. The Company has chosen the carrying value of property, Plant and Equipment existing as per previous
GAAP as on date of transition to Ind AS i.e IstApril, 2016 as deemed cost.
2.4. Biological Assets
2.4.1. Biological assets i.e. living animals or plants (other than bearer plants which are included in property, plant
and equipment) are measured at fair value less cost to sell, with any change therein recognised in profit or
loss.
2.5. Intangible Assets
2.5.1. Intangible assets are recognised only if it is probable that the future economic benefits that are attributable
to the assets will flow to the enterprise and the cost of the assets can be measured reliably;
2.5.2. Intangible assets are carried at cost net of accumulated amortization and accumulated impairment losses,
if any;
2.5.3. An intangible asset is derecognised on disposal, or when no future economic benefits are expected from
use or disposal. Gains or losses on derecognition are determined by comparing proceeds with carrying
amount. These are included in profit or loss within other gains/(losses);
2.5.4. The estimated useful life is reviewed at each financial year end and changes, if any, are accounted in the line
with revisions to accounting estimates;
2.5.5. Intangible assets are not ready for intended use as on date of Balance Sheet are disclosed as "Intangible
assets under development”;
2.5.6. The intangible assets with a finite useful life are amortised using Written Down Value Method over their
estimated useful lives except in the case ERP software which is amortised over the period of its useful
life on straight line method basis(SLM). The Management’s estimate of the useful lives for various class of
intangibles are given below:
2.6. Investment Property
2.6.1. Investment property is property (land or a building — or part of a building — or both) held either to earn
rental income or for capital appreciation or for both, but not for sale in the ordinary course of business,
use in production or supply of goods or services or for administrative purposes. Investment properties are
stated at cost net of accumulated depreciation and accumulated impairment losses, if any;
2.6.2. Any gain or loss on disposal of investment property calculated as the difference between the net proceeds
from disposal and the carrying amount of the Investment Property is recognised in Statement of Profit and
Loss;
2.6.3. Depreciation on building is provided over its useful life using written down value method. These useful lives
determined are in line with the useful lives as prescribed in the Schedule II of the Act.
2.7. Leases
The Company assesses whether a contract is or contains a lease, at the 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:
a) . the contract involves the use of an identified asset;
b) . the Company has substantially all of the economic benefits from use of the asset through the period of the
lease and
c) . the Company has the right to direct the use of the asset.
2.7.1. As a Lessee
The right-of-use asset is a lessee’s right to use an asset over the life of a lease. At the date of commencement
of the lease, the Company recognises a right-of-use asset and a corresponding lease liability for all lease
arrangements in which it is a lessee, except for short-term leases and leases of low value assets. For these, the
Company recognises the lease payments as an operating expense.
The right-of-use 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. Right-of-use 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.
The lease liability is initially measured 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. The lease liability is subsequently remeasured by increasing the carrying amount to reflect
interest on the lease liability and reducing the carrying amount to reflect the lease payments made.
A lease liability is remeasured upon the occurrence of certain events such as a change in the lease term or a
change in an index or rate used to determine lease payments. The remeasurement normally also adjusts the
leased assets.
2.7.2. As a Lessor
A lessor shall classify each of its leases as either an operating lease or a finance lease.
Finance leases
A lease is classified as a finance lease if it transfers substantially all the risks and rewards incidental to ownership
of an underlying asset. Company shall recognise assets held under a finance lease in its balance sheet and
present them as a receivable at an amount equal to the net investment in the lease.
Operating leases
A lease is classified as an operating lease if it does not transfer substantially all the risks and rewards incidental
to ownership of an underlying asset. Company shall recognise lease payments from operating leases as income
on straight line basis over the term of relevant lessee.
2.8. Impairment of Non-financial Assets
2.8.1. Non-financial assets other than inventories, deferred tax assets and non-current assets classified as held for
sale are reviewed at each Balance Sheet date to determine whether there is any indication of impairment. If
any such indication exists or when annual impairment testing for an asset is required, the Company estimates
the asset’s recoverable amount. The recoverable amount is the higher of the asset’s or Cash Generating
Unit’s (CGU) fair value less costs of disposal and its value in use. Recoverable amount is determined for an
individual asset, unless the asset does not generate cash inflows that are largely independent of those from
other assets or group of assets;
2.8.2. When 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.
2.9. Inventories
2.9.1. Inventories are valued at lower of cost and net realisable value. The cost of inventories is based on weighted
average basis;
During the Previous year, Company has changed its inventory valuation policy from FIFO to weighted
average method for raw materials with specific identifications.
2.9.2. Cost of raw materials and stores and spares includes cost of purchase and other costs incurred in bringing
the inventories to their present location and condition. The aforesaid items are valued at net realisable value
if the finished products in which they are to be incorporated are expected to be sold at a loss;
2.9.3. Cost of finished goods and work-in-progress include all costs of purchases, conversion costs and other
costs incurred in bringing the inventories to their present location and condition. The net realisable value
is the estimated selling price in the ordinary course of business less the estimated costs of completion and
estimated costs necessary to make the sale.
|