1 SIGNIFICANT ACCOUNTING POLICIES
This note provides a list of the significant accounting
policies adopted in the preparation of these
standalone financial statements.
1.1 BASIS OF PREPARATION OF FINANCIAL
STATEMENTS
i) Compliance with Ind AS
These standalone financial statements of the
Company have been prepared to comply in
all material respects with Indian Accounting
Standards as prescribed under Section 133 of
the Companies Act, 2013 (the Act) read with
the Companies (Indian Accounting Standards)
Rules, 2015 (as amended) and other relevant
provisions of the Act. Accounting policies have
been consistently applied except where newly
issued accounting standard is initially adopted
or a revision to an existing accounting standard
requires a change in the accounting policy.
All assets and liabilities have been classified as
current or non current as per the Company's
normal operating cycle which is more than
12 months considering the average project
period in respect of its construction business
and 12 months in respect of its other business
and other criteria set out in the Schedule III of
the Act.
These Standalone Financial Statements were
approved and authorised for issue with the
resolution of the Board of Directors on 28th
May, 2026.
ii) Historical cost convention
These financial statements have been
prepared on the historical cost basis except
for following assets and liabilities which have
been measured at fair value amount:¬
- Certain Financial Assets and Liabilities
(including derivative instruments).
- Defined benefit plans - Plan Assets.
iii) Items reported in the financial statements
are measured using the currency of the
primary economic environment in which the
entity operates (the functional currency).
The financial statements of the Company are
presented in Indian Rupee (H) which is the
functional and presentation currency of the
Company.
1.2 SEGMENT REPORTING
The Company's operating segments are established
on the basis of those components of the Company
that are evaluated regularly by the 'Chief Operating
Decision Making Group' (CODMG) as defined in Ind
AS 108 - 'Operating Segments; in deciding how to
allocate resources and in assessing performance.
CODMG consists of the Executive Chairman
and the Whole-time Directors. These have been
identified taking into account nature of products
and services, the differing risks and returns and
the internal business reporting systems. CODMG
examines the Company's performance both from
business and geographical perspective and has
considered business segment as primary segment
for disclosure.
1.3 PROPERTY, PLANT AND EQUIPMENT
Freehold land is stated at cost. All other items of
property, plant and equipment are stated at cost,
net of recoverable taxes, trade discounts and rebate,
etc. less accumulated depreciation and impairment
losses, if any. Such cost includes purchase price,
borrowing cost and any cost directly attributable to
bringing the assets to its working condition for its
intended use.
Subsequent costs are included in the asset's
carrying amount or recognised as a separate asset,
as appropriate, when it is probable that future
economic benefits associated with the item will
flow to the Company and the cost of the item can
be measured reliably.
Property, Plant and Equipment which are significant
to the total cost of that item of Property, Plant and
Equipment and having different useful life are
accounted separately.
The carrying amount of any component accounted
for as a separate asset is de-recognised when
replaced. All other repairs and maintenance are
charged to profit and loss during the reporting
period in which they are incurred.
The items of property, plant and equipment which
are not yet ready for use are disclosed as Capital
work-in-progress and are carried at cost, net of
accumulated impairment loss, if any.
An item of property, plant and equipment and any
significant part initially recognised is derecognised
upon disposal or when no future economic benefits
are expected from its use or disposal. Gains and
losses on disposals are determined by comparing
proceeds with carrying amount. These are included
in statement of Profit and Loss within 'Other
Income/ Expense'.
Depreciation methods, estimated useful lives
and residual value
(a) Depreciation is calculated using the straight
line method to allocate their cost, net of their
residual values on the basis of useful lives
prescribed in Schedule II to the Act. In respect
of the following assets, useful lives different
from Schedule II have been considered on the
basis of technical assessment made by expert
and management estimate. The management
believes that these estimated useful lives
are realistic and reflect fair approximation of
the period over which the assets are likely to
be used.
(b) Leasehold Land and Buildings thereon are
amortised over the tenure of respective leases
using the straight line method.
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.
1.4 INTANGIBLE ASSETS
Intangible assets acquired separately are measured
on initial recognition at cost incurred till it is
necessary for bringing intangible assets to the
location and condition necessary for it to be
capable of operating in the manner intended by
management. Such cost includes purchase price
and any cost directly attributable to bringing the
asset to its working condition for the intended use.
Following initial recognition, intangible assets are
carried at cost less any accumulated amortisation
and accumulated impairment losses, if any.
Computer Software for internal use which is
primarily acquired is capitalised. Subsequent costs
associated with maintaining such software are
recognised as expense as incurred. Cost of Software
includes licenses fees and cost of implementation,
system integration services etc. where applicable.
Amortisation method and period
The Company amortises intangible assets
(Computer Software) with a finite useful life using
the straight line method over a period of 3 years.
The amortisation period and the amortisation
method for Intangible Assets with a finite useful life
are reviewed at each reporting date and adjusted
prospectively, if appropriate.
1.5 IMPAIRMENT OF NON-FINANCIAL ASSETS
(INCLUDING PROPERTY, PLANT AND
EQUIPMENT AND INTANGIBLE ASSETS)
The Company assesses at each reporting date as
to whether there is any indication that any non¬
financial asset or group of Assets, identified as
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.
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.
Intangible assets are tested annually for
impairment, or more frequently if events or
changes in circumstances indicate that they might
be impaired.
The impairment loss recognised in prior accounting
period is reversed if there has been a change in the
estimate of recoverable amount.
1.6 INVENTORIES
Raw material, stores, work-in-progress and traded
goods are stated at the lower of cost and net
realisable value. Cost of inventories comprise all
cost of purchase and other cost incurred in bringing
them to their present location and condition. Cost is
determined on first in, first out basis.
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.
Contract cost incurred related to future activity of
the contract are recognised as an asset provided it
is probable that they will be recovered during the
contract period. Such costs represent the amount
due from customer and are often classified as
contract work-in-progress.
1.7 FINANCIAL INSTRUMENTS
(i) Financial Assets
A. Initial Recognition and Measurement
Financial assets are recognised when
the Company becomes a party to the
contractual provisions of the instrument.
On initial recognition, a financial asset
is recognised at fair value. Transaction
costs that are directly attributable to the
acquisition of Financial Assets, which are
not at Fair Value through Profit or Loss,
are adjusted to the fair value on initial
recognition.
B. Subsequent Measurement
Financial assets are subsequently
classified as measured at
Amortised Cost- A Financial Asset is
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.
• Fair Value through Other
Comprehensive Income (FVOCI)- A
Financial Asset is 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.
• Fair Value through Profit or Loss
(FVPL)- A Financial Asset which is
not classified in any of the above
categories are measured at FVPL.
C. Investments in Subsidiaries, Joint
Ventures and Associates
Investments in subsidiaries, joint ventures
and associates are 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
investments in subsidiaries, joint ventures
and associates, the difference between
net disposal proceeds and the carrying
amounts are recognised in the Statement
of Profit and Loss.
D. Other Equity Instruments
Equity instruments which are held for
trading are required to measure at
FVPL. All other equity instruments are
initially measured at fair value, with value
changes recognised in Statement of
Profit and Loss, except for those equity
investments for which the Company has
elected to present the value changes in
'Other Comprehensive Income'.
For investments in quoted equity
instruments, the Company has made
an irrevocable election at the time of
initial recognition to account for equity
instruments at FVOCI. The Company
makes such election on an instrument-
by-instrument basis. Fair value changes
excluding dividends, on an equity
instrument measured at FVOCI are
recognised in OCI. Amounts recognised
in OCI are not subsequently reclassified to
the statement of profit and loss. Dividend
income on the investments in equity
instruments are recognised as 'Other
Income' in the Statement of Profit and Loss.
E. Impairment of financial assets and
contract assets
In accordance with Ind AS 109, the
Company uses 'Expected Credit Loss'
(ECL) model, for evaluating impairment
of Financial Assets other than those
measured at FVPL and contract assets.
Expected credit losses are measured
through a loss allowance at an amount
equal to:
• The 12-months expected credit
losses (expected credit losses that
result from those default events on
the financial instrument that are
possible within 12 months after the
reporting date); or
Full lifetime expected credit losses
(expected credit losses that result
from all possible default events over
the life of the financial instrument),
as applicable.
The Company assesses on a forward
looking basis the expected credit losses
associated with its financial assets and
contract assets considered for ECL.
The impairment methodology applied
depends on whether there has been a
significant increase in credit risk.
For trade receivables and contract assets
only, the Company applies the simplified
approach permitted by Ind AS 109
Financial Instruments, which requires
expected lifetime losses to be recognised
from initial recognition of the receivables.
ECL allowance (or reversal) recognized
during the period is recognized as
expense / income in the Statement of
Profit and Loss.
(ii) Financial Liabilities
A. Initial Recognition and Measurement
All Financial Liabilities are recognized
at fair value and in case of borrowings,
net of directly attributable cost. Fees of
recurring nature are directly recognised
in the Statement of Profit and Loss as
finance cost.
B. Subsequent Measurement
Financial Liabilities are carried at
amortized cost using the effective interest
method.
For trade and other financial liabilities
maturing within one year from the
balance sheet date, the carrying amounts
approximate fair value due to the short
maturity of these instruments.
(iii) Derecognition of Financial Instruments
The Company derecognises 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 Ind AS 109. A Financial
liability (or a part of a Financial liability) is
derecognised from the Company's Balance
Sheet when the obligation specified in the
contract is discharged or cancelled or expires.
(iv) Offsetting
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. It
must be enforceable in the normal course
of business and in the event of default,
insolvency or bankruptcy of the Company or
the counterparty.
1.8 DERIVATIVES
The Company enters into certain derivative
contracts to hedge risks which are not designated
as hedges. Such contracts are accounted for at fair
value through profit and loss and are included in
'Other Income/Expense'.
1.9 CASH AND CASH EQUIVALENTS
For the purpose of presentation in the statement
of cash flows, cash and cash equivalents includes
cash on hand, deposits held at call with financial
institutions, other short term highly liquid
investments with original maturities of less than
three months or less that are readily convertible to
cash and which are subject to an insignificant risk of
changes in value.
1.10 EMPLOYEE BENEFITS
i) Short term Employee Benefits:
The undiscounted amount of short term
employee benefits expected to be settled
in exchange for the services rendered by
employees are recognised as expense during
the period when the employee renders
the service.
ii) Post Employment Benefit Plans
Contributions under Defined Contribution
Plans payable in keeping with the related
schemes are recognised as expenses for the
period, in which the employee has rendered
the service. The Company has no further
payment obligations once the contributions
have been paid. If the contribution payable
for service received before the balance sheet
date exceeds the contribution already paid,
the deficit payable is recognized as a liability
after deducting the contribution already
paid. If the contribution already paid exceeds
the contribution due for services received
before the balance sheet date, then excess
is recognized as an asset to the extent that
the pre-payment will lead to, for example, a
reduction in future payment.
For Defined Benefit Plans, the liability in respect
of gratuity is calculated using the Projected
Unit Credit Method, and spread over the
period during which the benefit is expected
to be derived from employees' services with
actuarial valuations being carried out at each
balance sheet date.
Re-measurement of Defined Benefit Plans in
respect of post-employment are recognised in
the Other Comprehensive Income. Past service
costs due to changes in present value of the
defined benefit obligation resulting from plan
amendments or curtailments are recognised
immediately in profit and loss. The retirement
benefit obligation recognised in the balance
sheet represents the present value of the
defined benefit obligation as reduced by the
fair value of scheme assets. Any asset resulting
from this calculation is limited to the present
value of any economic benefit available in the
form of reductions in future contributions to
the plan.
iii) Other Long term Employee Benefits
(unfunded):
The cost of providing other long term
employee benefits is calculated using the
Projected Unit Credit Method, and spread
over the period during which the benefit
is expected to be derived from employees'
services. Re-measurement actuarial gains and
losses and past service cost are recognised
immediately in the statement of profit and loss
for the period in which they occur. Other long
term employee benefit obligation recognised
in the balance sheet represents the present
value of related obligation.
1.11 LEASES
Leases are accounted as per Ind AS 116. At inception
of a contract, the Company assess whether the
contract is, or contains, a lease. 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.
The Company as a lessee, applies the short-term
lease recognition exemption to its short-term leases
(i.e. leases that has a lease term of 12 months or less
from the commencement date and do not contain a
purchase option) for offices, warehouses, employee
accommodations, equipments, etc. Lease payments
on short-term leases are recognised as expense on
a straight-line basis over the lease term.
|