II. Significant Accounting Policies

(a) Basis of preparation :

These financial statements are prepared in accordance with Indian Accounting Standards (Ind AS) under
the historical cost convention on the accrual basis except for certain financial instruments which are measured
at fair values, the provisions of the Companies Act , 2013 ('Act') (to the extent notified) and guidelines issued by
the Securities and Exchange Board of India (SEBI). The Ind AS are prescribed under Section 133 of the Act read
with Rule 3 of the Companies (Indian Accounting Standards) Rules, 2015 and Companies (Indian Accounting
Standards) Amendment Rules, 2016.

Accounting policies have been consistently applied except where a newly issued accounting standard is
initially adopted or a revision to an existing accounting standard requires a change in the accounting policy
hitherto in use.

(b) Use of estimate :

The preparation of the financial statements in conformity with IndAS requires management to make estimates,
judgments and assumptions. These estimates, judgments and assumptions affect the application of accounting
policies and the reported amounts of assets and liabilities, the disclosures of contingent assets and liabilities at
the date of the financial statements and reported amounts of revenues and expenses during the period.

(c) Revenue Recognition

Revenue is recognized to the extent that it is probable that the economic benefits will flow to the company
and revenue can be reliably measured

a. In respect of Sales : When the significant risks and rewards of ownership of goods have been passed on
to the buyer, which generally coincides with delivery/shipment of goods to customers.

b. In respect of Interest Income : On time proportion basis taking into account the amount outstanding and
the rate applicable.

c. In respect of Service Income : When the services are performed as per contract.

d. In respect of Dividend Income : When right to receive payment is established.

Under IndAS 18, Excise duty will not be netted from revenue and shown as a part of expenses. Revenue from
product sales is recognized exclusive of Excise Duty, GST, Sales Tax/Value added Tax (VAT) and net of returns,
Sales Discount etc. Sales Returns are accounted for when goods are returned.

(d) Property, plant and Equipment’s

Capital Work in Progress, Plant and Equipment is stated at cost, net of accumulated depreciation and
accumulated impairment losses, if any. Such Cost includes the cost of replacing part of the plant and equipment
and borrowing costs for long term construction projects if the 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 specific 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 is satisfied. All other
repair and maintenance costs are recognized in profit or loss as incurred. No decommissioning liabilities are
expected to be incurred on the assets of plant and equipment.

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 carrying amount
of the asset) is included in the income statement when the asset is derecognized

(e) Inventories

Inventories are valued as under:

a. Raw Materials: At Cost or Net Realizable Value whichever is lower

b. Scrap are valued at estimated realizable value.

Cost includes all direct cost and applicable manufacturing and administrative overheads. Inventories are
valued on FIFO basis. Variation, if any, between books and physical stocks detected on physical verification,
obsolete & slow moving stocks are adjusted in accounts as found appropriate.

(f) Financial instruments

1. Initial recognition :

The Company recognizes financial assets and financial liabilities when it becomes a party to the contractual
provisions of the instrument. All financial assets and liabilities are recognized at fair value on initial recognition,
except for trade receivables which are initially measured at transaction price. Transaction costs that are directly
attributable to the acquisition or issue of financial assets and financial liabilities that are not at fair value through
profit or loss are added to the fair value on initial recognition. Regular way purchase and sale of financial assets
are accounted for at trade date

2.Subsequent measurement :

(a) Non-derivative financial instruments

(i) Financial assets carried at amortized cost :

A financial asset is subsequently measured at amortized 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.

(ii) Financial assets at fair value through other comprehensive income :

A financial asset is subsequently measured at fair value through other comprehensive income 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. The Company has made an irrevocable
election for its investments which are classified as equity instruments to present the subsequent changes in fair
value in other comprehensive income based on its business model. Further, in cases where the Company has
made an irrevocable election based on its business model, for its investments which are classified as equity
instruments, the subsequent changes in fair value are recognized in other comprehensive income

(iii) Financial assets at fair value through profit or loss :

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

(iv) Financial liabilities :

Financial liabilities are subsequently carried at amortized cost using the effective interest method, except
for contingent consideration recognized in a business combination which is subsequently measured at fair value
through profit and loss. 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.

3. Derecognition of financial instruments :

The company derecognizes a financial asset when the contractual rights to the cash flows from the financial
asset expire or it transfers the financial asset and the transfer qualifies for derecognition under IndAS 109. A
financial liability (or a part of a financial liability) is derecognized from the Company's Balance Sheet when the
obligation specified in the contract is discharged or cancelled or expires.

(g) Impairment of Assets :

(a) Financial assets :

The Company recognizes loss allowances using the expected credit loss (ECL) model for the financial
assets which are not fair valued through profit or loss. Loss allowance for trade receivables with no significant
financing component is measured at an amount equal to lifetime ECL. For all other financial assets, expected
credit losses are measured at an amount equal to the 12-month ECL, unless there has been a significant
increase in credit risk from initial recognition in which case those are measured at lifetime ECL. The amount of
expected credit losses (or reversal) that is required to adjust the loss allowance at the reporting date to the
amount that is required to be recognised is recognized as an impairment gain or loss in profit or loss.

(b) Non-financial assets

(i) Property, plant and equipment : Property, plant and equipment 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 recognized in the 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 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 amortization or depreciation) had no impairment loss been
recognized for the asset in prior years

(h) Income Taxes :

Income tax expense comprises current and deferred income tax. Income tax expense is recognized in net
profit in the statement of profit and loss except to the extent that it relates to items recognized directly in equity,
in which case it is recognized in other comprehensive income.

Current income tax for current and prior periods is recognized at the amount expected to be paid to or
recovered from the tax authorities, using the tax rates and tax laws that have been enacted or substantively
enacted by the balance sheet date. Deferred income tax assets and liabilities are recognized for all temporary
differences arising between the tax bases of assets and liabilities and their carrying amounts in the financial
statements. Deferred tax assets are reviewed at each reporting date and are reduced to the extent that it is no
longer probable that the related tax benefit will be realized.

Deferred income tax assets and liabilities are measured using tax rates and tax laws that have been enacted
or substantively enacted by the balance sheet date and are expected to apply to taxable income in the years in
which those temporary differences are expected to be recovered or settled. The effect of changes in tax rates on
deferred income tax assets and liabilities is recognized as income or expense in the period that includes the
enactment or the substantive enactment date. A deferred income tax asset is recognized to the extent that it is
probable that future taxable profit will be available against which the deductible temporary differences and tax
losses can be utilized. Deferred income taxes are not provided on the undistributed earnings of subsidiaries and
branches where it is expected that the earnings of the subsidiary or branch will not be distributed in the foreseeable
future. The company offsets current tax assets and current tax liabilities, where it has a legally enforceable right

to set off the recognized amounts and where it intends either to settle on a net basis, or to realize the asset and
settle the liability simultaneously. The income tax provision for the interim period is made based on the best
estimate of the annual average tax rate expected to be applicable for the full financial year. Tax benefits of
deductions earned on exercise of employee share options in excess of compensation charged to income are
credited to share premium.

(i) Earnings per equity share :

The basic earnings per share ("EPS”) is computed by dividing the net profit after tax for the Year by the
weighted average number of equity shares outstanding during the Year. For the purpose of calculating diluted
earnings per share, net profit after tax for the Year and the weighted average number of shares outstanding
during the Year are adjusted with the effects of all dilutive potential equity shares. The dilutive potential equity
shares are deemed converted as of the beginning of the Year, unless they have been issued at a later date.

(j) Cash & cash Equivalents :

Cash and cash equivalents in the Balance sheet comprise cash on hand, cheques on hand, balance with
banks on current accounts and short term, highly liquid investments with an original maturity of three months or
less and which carry insignificant risk of changes in value.

(k) Cash Flow Statements :

Cash flows are reported using the indirect method, whereby profit for the period is adjusted for the effects
of transactions of a non-cash nature, any deferrals or accruals of past or future operating cash receipts or
payments and item of income or expenses associated with investing or financing cash flows. The cash flows
from operating, investing and financing activities of the Company are segregated.

(l) Employee benefits :

(a) Short Term &Post-Employment Benefits :

Employee benefits of short-term nature are recognized as expense as and when those accrue. Post
employments benefits are recognized as expenses based on actuarial valuation at Year end which takes into
account actuarial gains and losses.

The Company recognizes compensation expense relating to share-based payments in net profit using fair-
value in accordance with Ind AS 102, Share-Based Payment. The estimated fair value of awards is charged to
income on a straight-line basis over the requisite service period for each separately vesting portion of the award
as if the award was in-substance, multiple awards with a corresponding increase to share options outstanding
account.