1.3 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

a. Key accounting estimates and judgments

The preparation and presentation of financial statements in conformity with Ind AS requires management to
make judgments, estimates and assumptions that affect the reported amounts of assets and liabilities, the
disclosure of contingent liabilities on the date of the financial statements and reported amounts of revenues
and expenses during the period.

Although these estimates are based on the management's best knowledge of current events and actions,
uncertainty about these assumptions and estimates could result in the outcomes requiring a material
adjustment to the carrying amounts of assets or liabilities in future periods. Accounting estimates could
change from period to period. Any revision to accounting estimates is recognized prospectively in the current
and future periods, and if material, their effects are disclosed in the financial statements. Actual results could
differ from the estimates. Any difference between the actual results and estimates are recognized in the period
in which the results are known/materialize.

Information about critical judgments in applying accounting policies, as well as estimates and assumptions
that have the most significant effect to the carrying amounts of assets and liabilities within the next financial
year, are included in the following notes:

I. Measurement of defined benefit obligations

II. Measurement and likelihood of occurrence of contingencies

III. Recognition of deferred tax assets

b. Inventories

Inventories are valued at lower of cost and net realizable value (except as otherwise stated) on an item- by¬
item basis, as under:

Raw materials, packing materials, stores and spares: Cost of inventory comprises all costs of purchase,
duties and taxes (other than those subsequently recoverable from tax authorities) and all other costs incurred
in bringing the inventories to their present location and condition. Raw materials and other items held for use in
the production of inventories are not written down below cost if the finished products in which they will be
incorporated are expected to be sold at or above cost. Cost is determined on a first-in first-out formula.

Work-in-progress and finished goods: Cost includes direct materials and costs of conversion in the form of
labour and a systematic allocation of fixed and variable production overheads. It also includes other costs
which are incurred in bringing the inventories to their present location and condition. The allocation of fixed
production overheads is based on normal capacity of production. Cost is determined on first-in first-out
formula. Realizable value of pre-determined normal rate of scrap is deducted from the cost of inventories.
However, cost of inventories neither includes abnormal amounts of wasted material nor any scrap realizations
there from.

By products and scrap are recognized at their net realizable value.

Stock-in-trade: Cost includes cost of purchases, duties and taxes (other than those subsequently
recoverable from authorities) and other costs which are incurred in bringing the inventories to their present
location and condition. Cost is determined on a first-in first-out formula.

Parent Birds are are sold as cull birds after loosing its fertility and Commercial Birds are sold after they are
grown up and ready for Consumption.

Net realizable value is the estimated selling price in the ordinary course of business less the estimated costs
of completion and the estimated costs necessary to make the sale.

Cost of agricultural produce is deemed to be the fair value on the date of rise.

Cost of finished goods and work-in-progress include cost of conversion and other costs incurred in
bringing the inventories to their present location and condition.

c. Taxes

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. The tax rates and tax laws used to compute the amount are those that are enacted or
substantively enacted at the reporting date.

Current income tax relating to items recognized directly in equity is recognized in equity and not in the
statement of profit and loss. 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 bases 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 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 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 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 asset 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. Deferred tax
items are recognized in correlation to the underlying transaction 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 taxation authority.

Deferred tax assets include Minimum Alternate Tax (MAT) paid in accordance with the tax laws in India; to the
extent it would be available for set off against future current income tax liability. Accordingly, MAT is recognized
as deferred tax asset in the balance sheet when the asset can be measured reliably and it is probable that the
future economic benefit associated with the asset will be realized.

d. Property, Plant and Equipment

Property, plant and equipment are stated at historical cost less accumulated depreciation and impairment
losses, if any. Cost comprises of purchase price net of trade discounts and rebates, non- refundable duties and
taxes, any directly attributable cost of bringing the asset to its working condition for its intended use. Cost also
includes borrowing cost directly attributable to acquisition/ construction of a qualifying asset up to the date the
asset is ready for its intended use. Subsequent expenditure on fixed assets is capitalized only if such
expenditure results into an increase in the future benefits from such asset beyond its previously assessed
standard of performance.

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.

Capital work-in-progress comprises the cost of property, plant and equipment that are yet not ready for their
intended use at the balance sheet date. The depreciable amount of a depreciable fixed asset is allocated on a
systematic basis to each accounting period over the useful life of the asset. Management's estimate of useful
life, which is duly supported by technical evidence, is as stipulated in Schedule II to the Companies Act,
2013.The useful life is for the whole of the asset, except where cost of a part of the asset is significant to total
cost of the asset and useful life of that part is different from the useful life of the remaining asset, useful life of
that significant part ("component”) is determined separately and the depreciable amount of the said
component is depreciated is allocated on a systematic basis to each accounting period during the useful life of
the asset.

In arriving at the depreciable amount, residual value in case of certain assets are considered to be more than
5% of the original cost, this estimate of residual value is duly supported by technical advice. Depreciation on
assets acquired during the year is calculated on a pro-rata basis from the date of addition. Similarly,
depreciation on assets sold, discarded, demolished or destroyed during the year is also calculated on a pro
rata basis up to the date on which such asset has been sold, discarded, demolished or destroyed. Depreciable
assets costing up to Rupees 5,000/- are depreciated fully in the year of acquisition. 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.

e. Leases

IND-AS 116 "Leases” is mandatory for the accounting period commencing on and from 1st April 2019, and has
replaced the existing IND-AS 17 relating to leases. We have applied the modified retrospective approach, for
which no significant adjustments were required to be made to the retained earnings as at 1st April 2019.
However, no material lease has been recognized for the year ending March 31,2025.

f. Employee Benefits

Short term employee benefits

All employee benefits which fall due wholly within twelve months after the end of the period in which employee
renders the related service are classified as short-term employee benefits. Undiscounted value of short term
benefits such as salaries, wages, bonus and ex-gratia are recognized in the period in which the employee
renders the related service.

Defined Contribution Plans:

The Company's Employee's Provident Fund scheme, Employee's State Insurance Scheme and Employee's
Superannuation Scheme are defined contribution plans. The Company's contribution payable under the
schemes is recognized as an expense in the statement of profit and loss during the period in which the
employee renders the related service.

Defined benefit plan Gratuity

The Company operates a defined benefit gratuity plan, which requires contributions to be made to a
separately administered fund. The defined benefit plan surplus or deficit on the balance sheet comprises the
total for each of the fair value of plan assets less the present value of the defined liabilities. The cost of
providing benefits under the defined benefit plan is determined based on independent actuarial valuation
using the projected unit credit method. The gratuity liability is measured at the present value of the estimated
future cash flows. The discount rates used for determining the present value of the obligation under defined
benefit plan, is based on the market yield on government securities as at the balance sheet date.

Re-measurements, comprising of actuarial gains and losses, the effect of the asset ceiling, excluding amounts
included in net interest on the net defined benefit liability and the return on plan assets (excluding amounts
included in net interest on the net defined benefit liability), are recognized immediately in the balance sheet
with a corresponding debit or credit to retained earnings through OCI in the period in which they occur. Re¬
measurements are not reclassified to profit or loss in subsequent periods

Past service costs are recognized in profit or loss on the earlier of

The date of the plan amendment or curtailment, and

The date that the Group recognizes related restructuring cost

Net interest is calculated by applying the discount rate to the net defined benefit liability or asset.

The Company recognizes the following changes in the net defined benefit obligation as an expense in the
statement of profit and loss

Service costs comprising current service costs, past-service costs, gains and losses on curtailments and non¬
routine settlements, and Net interest expense or income.

Other Long term employee benefit

Entitlement to annual leave is recognized when they accrue to employees. Annual leave can either be availed
or en-cashed subject to a restriction on the maximum number of leaves. The liability is determined and
provided during the year.

g. Earnings Per Share

Earnings per share (EPS) is calculated by dividing the net profit for the year attributable to the equity
shareholders by weighted average number of equity shares outstanding during the year. For the purpose of
calculating diluted earnings per share, the net profit for the period attributable to equity shareholders and
weighted average number of shares outstanding during the period is adjusted for the effects of all diluted

potential equity shares.

h. Impairment of Non-Financial Assets

The Company assesses, at each reporting date, whether there is an indication that an asset maybe impaired.
If any indication exists, or when annual impairment testing for an asset is required, the Company estimates the
asset's recoverable amount. An asset's recoverable amount is the higher of an asset's or cash-generating
units (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 groups of assets. 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.

In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax
discount rate that reflects current market assessments of the time value of money and the risks specific to the
asset. In determining fair value less costs of disposal, recent market transactions are considered. If no such
transactions can be identified, an appropriate evaluation model is used. These calculations are corroborated
by valuation multiples or other available fair value indicators.