a) Brief description of the Company
TVS Holdings Limited ('the Company') is a public limited company incorporated in India whose shares are publicly traded. The
registered office is located at "Chaitanya", No.12, Khader Nawaz Khan Road, Nungambakkam, Chennai - 600006, Tamil Nadu,
India.
Post the composite scheme of demerger during Financial year 2023-24, the Company was into trading business of automotive
components and investing activities. As per the conditions stipulated by RBI while according CIC Approval, the Company has
wound up the Trading business of automotive components during FY 2024-25.
The Company received the Certificate of Registration (No. N-07-00904) dated 14 March, 2024 from the Reserve Bank of India (RBI)
and commenced Non-Banking Financial activity thereon. The Company is a Systemically Important Non-Deposit taking Non¬
Banking Finance Company, as defined under Section 45-IA of the Reserve Bank of India (RBI) Act, 1934. The Company is
categorised as "NBFC - Core Investment Company (NBFC-CIC)" vide RBI circular DNBR (PD) CC.No.097/03.10.001/2018-19
dated 22 February 2019. Effective 01 October 2022, the Company has been categorised as NBFC-Middle Layer under the RBI
Scale Based Regulation dated 22 October 2021.
b) Basis of preparation
The financial statements comply in all material aspects with Indian Accounting Standards (Ind AS) notified under Section 133 of
the Companies Act, 2013 (the Act) read with Companies (Indian Accounting Standards) Rules, 2015 and other relevant provisions
of the Act.
The financial statements have been prepared in accordance with Division III of Schedule III of the Companies Act 2013 notified
by Ministry of Corporate Affairs on October 11, 2018. Further, the Company follows application guidance, clarifications, circulars,
and directions issued by the Reserve Bank of India (RBI) for Non-Banking Financial Companies (NBFC) or other regulators, as
and when they are issued and applicable.
The financial statement has been prepared on the historical cost convention under accrual basis of accounting except for certain
assets and liabilities (as per the accounting policy below), which have been measured at fair value.
These financial statements for the year ended 31st March 2026 have been approved and authorised for issue by the Board of
Directors at its meeting held on 13th May 2026.
c) Going Concern
The Company's financial statements have been prepared on a going concern basis.
d) Use of estimates
The preparation of financial statements requires management to make certain estimates and assumptions that affect the amounts
reported in the financial statements and notes thereto. The management believes that these estimates and assumptions are reasonable
and prudent. However, actual results could differ from these estimates. Any revision to accounting estimates is recognised prospectively
in the current and future period. The estimates and the underlying assumptions are reviewed on an ongoing basis.
This note provides an overview of the areas that involve a higher degree of judgment or complexity. It also provides an overview of
items which are more likely to be materially adjusted due to estimates and assumptions turning out to be different than those originally
assessed. Detailed information about each of these estimates and judgments is included in the relevant notes together with information
about the basis of calculation for each affected line item in the financial statements.
e) Cost Recognition
Costs and expenses are recognised when incurred and are classified according to their nature. Expenditures are capitalised where
appropriate.
f) Significant Estimates and judgments
The areas involving significant estimates or judgements are:
i) Estimation of defined benefit obligation
ii) Estimation of useful life of Property, Plant and Equipment
iii) Estimation of Provisions
iv) Estimation and evaluation of Provisions and Contingencies relating to tax litigations.
g) Revenue recognition
Revenue towards satisfaction of a performance obligation is measured at the amount of transaction price (net of variable consideration)
allocated to that performance obligation. The transaction price of goods sold and services rendered is net of variable consideration
on account of various discounts and schemes offered by the Company as part of the contract.
i) Sale of products:
Revenue is recognised when the performance obligations are satisfied and the control of the goods is transferred, being when
the goods are delivered as per the relevant terms of the contract at which point in time the Company has a right to payment
for the goods, customer has possession and legal title to the goods, customer bears significant risk and rewards of ownership
and the customer has accepted the goods or the Company has objective evidence that all criteria for acceptance have been
satisfied.
ii) Revenue from Services:
Revenue from Services is recognised in the accounting period in which the performance obligation is fulfilled.
The Company earns revenue from services in the form of Royalty fee, Management Fee rendered to group companies
including strategic, operational, administrative and other support functions, as well as from granting rights to use intellectual
property as per terms agreed with the parties involved.
Where services are rendered or rights are provided continuously over a period, and the customer simultaneously receives and
consumes the benefits, revenue is recognised over time, typically on a straight-line basis, when this best reflects the pattern
of performance.
In cases where the consideration is variable and linked to the customer's turnover or usage, revenue is recognised only when
the underlying sales or usage occurs, in line with the guidance on variable consideration under Ind AS 115.
iii) Dividend income:
Dividends are recognised in the Statement of Profit and Loss only when the right to receive payment is established and it is
probable that the economic benefits associated with the dividend will flow to the Company, and the amount of dividend can
be reliably measured.
iv) Interest Income:
Interest income is recognised using the Effective Interest Rate (EIR) method for all financial assets measured at amortised
cost. The EIR is the rate that exactly discounts estimated future cash receipts through the expected life of the financial asset,
to its gross carrying amount. The calculation of the effective interest rate includes transaction costs and transaction income
that is directly attributable to the acquisition of a financial asset.
h) Property, Plant and Equipment and Intangible assets
Freehold Land is stated at historical cost. All other items of Property, Plant and Equipment are stated at cost of acquisition/
construction less accumulated depreciation / amortisation and impairment, if any. Cost includes:
(i) purchase price,
(ii) taxes and duties,
(iii) labour cost,
(iv) directly attributable overheads incurred upto the date the asset is ready for its intended use, and
(v) Government grants that are directly attributable to the assets acquired.
However, cost excludes excise duty, value added tax and Goods and Services tax, and to the extent credit of the duty or tax is
availed of.
Subsequent costs are included in the asset's carrying amount or recognised as a separate asset, as appropriate, only 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. The carrying amount of any component accounted for as separate asset is derecognised when replaced. All other repairs
and maintenance are charged to the Statement of Profit and Loss during the reporting period in which they are incurred.
Government grants relating to the purchase of property, plant and equipment are adjusted against the cost of Property, Plant and
equipment.
Gains or losses on disposals are determined by comparing proceeds with the carrying amount. These are included in the Statement
of Profit and Loss within Other income.
Intangible Assets
Intangible assets with Finite useful lives that are acquired separately and the estimated useful life is more than one year, is
capitalised and carried at cost less accumulated amortisation and accumulated impairment losses.
i) Depreciation and Amortisation
i) Depreciation on Property, Plant and Equipment is charged over the estimated useful life of the asset or part of the asset as
evaluated by a Chartered Engineer and in accordance with Ind AS 16, taking into consideration both usage, useful life and
legal limitations on the use of assets, on straight line method, in accordance with Part A of Schedule II to the Companies Act,
2013. Depreciation is adjusted for the proportionate usage with reference to the asset's expected capacity or physical output
during the reporting period.
ii) The estimated useful life of the Property, Plant and Equipment as assessed by the Chartered Engineer and followed by the
Company is furnished below:
iii) The residual value for all the above assets is retained at 5% of the cost except for Mobile phones for which nil residual value
is considered. Residual values and useful lives are reviewed, and adjusted, if appropriate, for each reporting period.
iv) On Property, Plant and equipment added / disposed off during the year, depreciation is charged on pro-rata basis for the period
for which the asset was purchased and used.
v) Depreciation in respect of Property, Plant and equipment costing individually less than $ 5,000/- is provided at 100%.
vi) The Intangible assets are amortised on straight line basis over its useful life, viz., 2-3 years in case of software. The useful life
of the Intangible Assets are reviewed annually with respect to estimates and changes if any are, being accounted for on a
prospective basis.
An intangible asset is derecognised on disposal, or when no future economic benefits are expected from use or disposal.
Gains or losses arising from derecognition of an Intangible asset, measured as the difference between the net disposal proceeds
and the carrying amount of the assets, and is recognised as Profit or loss within Other Income / Expenses.
j) Impairment
Assets are tested for impairment whenever events or changes in circumstances indicate that the carrying amount may not be
recoverable. An impairment loss is recognised for the amount by which the asset's carrying amount exceeds its recoverable
amount. The recoverable amount is the higher of an asset's fair value less costs of disposal and value in use. For the purposes
of assessing impairment, assets are grouped at the lowest levels for which there are separately identifiable cash inflows which are
largely independent of the cash inflows from other assets or group of assets (cash-generating units). Non-financial assets other
than goodwill that suffered impairment are reviewed for possible reversal of the impairment at the end of each reporting period.
k) Foreign currency translation
(i) Functional and presentation currency
Items included in the financial statements are measured using the currency of the primary economic environment in which the
Company operates ('the functional currency'). i.e in Indian rupees (INR) and all values are rounded off to nearest crores except
where otherwise indicated.
(ii) Transactions and balances
Transactions in foreign currencies are recorded at the exchange rates prevailing on the date of transaction.
• Foreign currency monetary assets and liabilities such as cash, receivables, payables, etc., are translated at year end
exchange rates.
• Non-monetary items denominated in foreign currency such as investments, fixed assets, etc., are valued at the exchange
rate prevailing on the date of transaction.
l) Inventories
Inventories are valued at the lower of cost and net realisable value.
i) Cost of raw materials, components, stores, spares, work-in-process and finished goods are determined on a moving average
basis.
ii) Cost of finished goods and work-in-process comprises of Direct materials, Direct labour and an applicable proportion of
Variable and Fixed overhead expenditure, Fixed Overhead Expenditure absorbed on the basis of normal operating capacity.
iii) Costs are assigned to individual items of inventory on the basis of weighted average costs. Costs of purchased inventory are
determined after deducting rebates and discounts. Net realisable 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.
iv) Materials and supplies held for use in production of inventories are not written down if the finished products in which they
will be used are expected to be sold at or above cost. Slow and non-moving material, obsolescence, defective inventories
are duly provided for.
m) Employee benefits
i) Short term obligations:
Short-term obligations are those that are expected to be settled fully within 12 months after the end of the reporting period.
They are recognised upto the end of the reporting period at the amounts expected to be paid at the time of settlement.
ii) Other long term obligations:
The liabilities for earned leave are not expected to be settled wholly within 12 months after the end of the period in which
the employees render the related service. They are, therefore, recognised and provided for at the present value of the
expected future payments to be made in respect of services provided by employee upto the end of reporting period using the
projected unit credit method. The benefits are discounted using the market yields at the end of the reporting period that have
terms approximating to the terms of the related obligation.
Remeasurements as a result of experience adjustments and changes in actuarial assumptions are charged to Profit and Loss
account.
The obligations are presented as current liabilities in the balance sheet if the entity does not have an unconditional right to
defer settlement for at least twelve months after the reporting period, regardless of when the actual settlement is expected
to occur.
iii) Post-employment obligation:
The Company operates the following post-employment schemes:
a) Defined Benefit plans such as gratuity for its eligible employees, pension plan for eligible senior managers; and
b) Defined Contribution plan such as provident fund.
a) Pension and gratuity obligation:
The liability or asset recognised in the balance sheet in respect of defined benefit pension and gratuity plan is the present
value of the defined benefit obligation at the end of the reporting period less the fair value of plan assets. The defined
benefit obligation is calculated annually by actuaries using the projected unit credit method.
The present value of the defined benefit obligation denominated in Indian Rupees is determined by discounting the
estimated future cash outflows by reference to market yields at the end of the reporting period on the government bonds
that have terms approximating to the terms of the related obligation.
The net interest cost is calculated by applying the discount rate to the net balance of the defined benefit obligation and
the fair value of plan assets. This cost is included in employee benefit expense in the Statement of Profit and Loss.
Remeasurement gains and losses arising from experience adjustments and changes in actuarial assumptions are
recognised in the period in which they occur, directly in other comprehensive income (net of deferred tax). They are
included in retained earnings in the statement of changes in equity and in the balance sheet.
Changes in the present value of the defined benefit obligation resulting from plan amendments or curtailments are
recognised immediately in the Statement of Profit or Loss as past service cost.
b) Provident fund:
The eligible employees of the Company are entitled to receive benefits in respect of provident fund, a defined contribution
plan, in which both employees and the Company makes monthly contributions at a specified percentage of the covered
employees' salary. The provident fund contributions are made to an irrevocable trust set up by the Company. The
Company is generally liable for annual contributions and any shortfall in the fund assets based on the Government
specified minimum rates of return and recognises such contributions and shortfall, if any, as an expense in the year in
which it is incurred.
iv) Bonus plans:
The Company recognises a liability and an expense for bonus. The Company recognises a provision where contractually
obliged or where there is a past practice that has created a constructive obligation.
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