II. Material Accounting PoliciesA. STATEMENT OF COMPLIANCE & BASIS OF PREPARATION
The financial statements of the company have been prepared
in accordance with the Indian Accounting Standards (Ind AS)
notified under the Companies (Indian Accounting Standards)
Rules, 2015 as amended from time to time by the Ministry of
Corporate Affairs (MCA), the provisions of Companies Act, 2013,
and guidelines issued by the Securities and Exchange Board of
India (SEBI). Accounting policies have been consistently applied
except where a newly issued Indian Accounting Standard is
initially adopted or a revision to an existing Indian Accounting
Standard requires a change in the accounting policy hitherto in
use. Financial statements of the company are prepared under
the historical cost convention except for the certain financial
assets and liabilities measured at fair value as mentioned in
applicable accounting policies.
The financial statements are present in India Rupees (INR).
Amount has been rounded off to nearest lacs.
These standalone financials statements have been approved
for issue by the Board of Directors at its meeting held on May
30, 2026.
B. (I) USE OF ESTIMATES AND JUDGEMENTS
The preparation of the financial statements is in conformity with
Ind AS 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.
Accounting estimates could change from period to period.
Actual results could differ from those estimates. Appropriate
changes in estimates are made as management becomes
aware of changes in circumstances surrounding the estimates.
The estimates and underlying assumptions are reviewed on
going concern basis.
Revisions to accounting estimates are recognized in the period
in which the estimate is revised if the revision affects only that
period, in the period of the revision and future periods if the
revision affects both current and future.
(II) CRITICAL ACCOUNTING JUDGEMENTS AND KEY SOURCES
OF ESTIMATION UNCERTAINTY
In the application of the Company accounting policies, which
are described as above, the management of the Company are
required to make judgements, estimates and assumptions
about the carrying amounts of assets and liabilities that are
not readily apparent from other sources. The estimates and
associated assumptions are based on historical experience
and other factors that are considered to be relevant. Actual
results may differ from these estimates. The estimates
and underlying assumptions are reviewed on an ongoing
basis. Revisions to accounting estimates are recognised
prospectively.
The following are the areas of estimation uncertainty and
critical judgements that the management has made in the
process of applying the Company’s accounting policies and that
have the most significant effect on the amounts recognized in
the standalone financial statements:-
Useful lives of depreciable assets
Management reviews the useful lives of depreciable assets at
each reporting date. As at the current year end, management
assessed that the useful lives represent the expected utility
of the assets to the Company. Further, there is no significant
change in the useful lives as compared to previous year.
Defined benefit plans
The cost of the defined benefit plan and other post-employment
benefits and the present value of such obligation are determined
using actuarial valuations. An actuarial valuation involves
making various assumptions that may differ from actual
developments in the future. These include the determination
of the discount rate, future salary increases, mortality rates
and future pension increases. Due to the complexities involved
in the valuation and its long-term nature, a defined benefit
obligation is sensitive to changes in these assumptions. All
assumptions are reviewed at each reporting date.
PROVISION AND CONTINGENT LIABILITY
On an ongoing basis, Company reviews pending cases, claims
by third parties and other contingencies. For contingent losses
that are considered probable, an estimated loss is recorded
as an accrual in financial statements. Contingent losses that
are considered possible are not provided for but disclosed as
Contingent liabilities in the financial statements. Contingencies
the likelihood of which is remote are not disclosed in the
financial statements. Contingent gain are not recognized until
the contingency has been resolved and amounts are received
or receivable.
Impairment of financial and non-financial assets
The impairment provisions for Financial Assets are based on
assumptions about risk of default and expected cash loss rates.
The company uses judgement in making these assumptions
and selecting the inputs to the impairment calculation, based
on Company’s past history, existing market conditions as well as
forward-looking estimates at the end of each reporting period.
The Company assesses the investment in equity instrument of
subsidiary companies carried at cost for impairment testing, by
comparing carrying value with recoverable value, adopting DCF
model for arriving value in use etc.
Impairment of Non - Financial Assets exists when the
carrying value of an asset or cash generating unit exceeds its
recoverable amount, which is the higher of its fair value less
costs of disposal and its value in use. The fair value less costs
of disposal calculation is based on available data from binding
sales transactions, conducted at arm’s-length, for similar
assets or observable market prices less incremental costs for
disposing of the asset. The value in use calculation is based on
a DCF model.
C. REVENUESRevenues from sale of goods and processing
Revenue from the sale of goods and processing of material (Job
Work) in the course of ordinary activities is measured at the
value of the consideration received or receivable, net of returns,
trade discounts, rate differences and volume rebates. Revenue
is recognized at point of time which generally coincides with
the delivery of products, representing transfer of control to the
buyer, recovery of the consideration is probable, the associated
costs and possible return of goods can be estimated reliably,
there is no continuing effective control over the goods and the
amount of revenue can be measured reliably. The timing of
transfer of control normally happens upon shipment. Export
sales are recognised on the date of shipping bill as per terms of
sale and are recorded at the relevant exchange rates prevailing
on the date of the transaction. However, in case of consignment
sales to agents revenues are recognized when the materials are
sold to ultimate customers.
Further, revenues are recognized at gross value of consideration
of goods & processing of goods excluding Goods and Service
Tax (GST).
Revenue from Services
Revenue from the service contract is recognized when the
related services are performed and revenue from the services
at the end of the reporting period is recognized based on stage
of completion method. When there is uncertainty as to the
ultimate collection of the revenue, recognition is postponed
until such uncertainty is resolved. Revenues from service
contracts are measured based on the services performed to
date as a percentage of total services to be performed. In case
where the services are performed by an indeterminate number
of acts over a specified period of time, revenue is recognized on
a straight line basis over the specified period. After the initial
recognition, in respect of uncollectible amount, provisions
are made in the period in which amount is identified as
uncollectible.
Interest Income
Interest income is recognized on time apportionment basis.
Effective interest method is used to compute the interest
income on long terms loans and advances.
Dividend Income
Dividend income is recognized when the right to receive is
established, which is generally when shareholders approve the
dividend.
Dividend Income on cumulative redeemable preference shares
is recognized on accrual basis.
D. PROPERTY, PLANT AND EQUIPMENT (PPE)Recognition and measurement:
Property, plant and equipment are initially recognized at cost
after deducting refundable purchase taxes and including the
cost directly attributable to bring the asset to the location
and conditions necessary for it to be capable of operating in
the manner intended by the management, borrowing cost
in accordance with the established accounting policy, cost
of restoring and dismantling, if any, initially estimated by
the management. After the initial recognition the property,
plant and equipment are carried at cost less accumulated
depreciation and impairment losses, if any.
Cost of Self-constructed assets is determined using the
same principles as for acquired assets after eliminating the
component of internal profits.
Any gain or loss on disposal of an item of property, plant and
equipment is recognized in the Statement of Profit & Loss.
Depreciation on all property, plant & equipment are provided
for, from the date of put to use for commercial production on
straight line method at the useful lives prescribed in Schedule-II
to the Companies Act, 2013, except for the following, where the
management believes that technical useful lives are different
from those prescribed in Schedule II of the Companies Act, 2013
based on technical evaluation:
Cost of leasehold land (including classified as investment
property) are written off over the primary lease period of the
land except for the leasehold land, held by the company on the
date of transition, which is amortized over the remaining useful
lives of the assets. Freehold land is not depreciated.
The estimated useful lives, residual values and depreciation
method are reviewed at each financial year end and the effect
of any change is accounted for on prospective basis.
The carrying amount of all the property, plant and equipment
are derecognized on its disposal or when no future economic
benefits are expected from its use or disposal and the gain or
loss on de-recognition is recognized in the statement of profit
& loss.
Reclassification to investment property:
When the use of a property changes from owner-occupied to
investment property, the property is reclassified as investment
property at its carrying amount on the date of reclassification.
E. INTANGIBLE ASSETS
Acquired Intangible assets are initially recognized at cost
after deducting refundable purchase taxes and including the
transaction cost, if any. After initial recognition, intangibles are
carried at cost less accumulated amortization and impairment
losses, if any.
Intangible assets in respect of Product development is created
when the technical and commercial feasibility of the project
is demonstrated, future economic benefits are probable, the
company has an intention and ability to complete and use or sell
the product / technology and the cost is reliably measurable.
Revenue expenditures pertaining to Research is charged to the
statement of profit & loss. Development costs of products are
charged to the statement of profit & loss unless a product’s
technological and commercial feasibility has been established
in which case such expenditure is capitalized. Subsequent
to initial recognition, internally generated intangible assets
are reported at cost less accumulated amortization and
accumulated impairment loss, if any.
Intangibles assets are amortized over their respective individual
estimated useful lives on a straight line basis, from the date
they are available for use, as per period prescribed in respective
license/ agreement or five years.
Estimated Useful Life of Intangible assets in respect of acquired
customer contract is 10 years, which represents the period over
which the economic benefits are expected to be derived from
such asset.
Intangible asset is derecognized on disposal or when no
future economic benefits are expected from continuing use or
disposal.
The estimated useful lives, residual values and amortization
method are reviewed at each financial year end and the effect
of any change is accounted for on prospective basis.
F. INVESTMENT PROPERTIES
Investment properties are initially recognized at cost after
deducting refundable purchase taxes and including the
transaction cost, if any. After initial recognition the investment
properties are carried at cost less accumulated depreciation
and impairment losses, if any.
Transfer to and from the investment properties are made when
and only when, there is change in the use of the investment
property as evidenced by the conditions laid down under
the Indian accounting standard. The carrying amount of the
property as on the date of classification is considered as
carrying value of the investment property and vice-versa.
Depreciation on investment properties are provided for from
the date of put to use on straight line method at the useful lives
prescribed in Schedule-II to the Companies Act, 2013.
The carrying amount of the investment properties are
derecognized on its disposal or when no future economic
benefits are expected from its use or disposal and the gain or
loss on de-recognition is recognized in the statement of profit
& loss.
The estimated useful lives, residual values and depreciation
method are reviewed at each financial year end and the effect
of any change is accounted for on prospective basis.
The fair value of the investment properties are disclosed in the
notes.
G. INVENTORIES
Inventories of finished goods and work in progress are valued
at lower of cost, based on weighted average method, (except
in case of machine manufacturing where specific identification
method is used) arrived after including depreciation/
amortization on plant & machinery, electrical installation,
right of use assets and factory building, repair & maintenance
on factory building, and specific manufacturing expenses
including specific payments & benefits to employees or net
realizable value.
Raw Materials and other materials including packaging, stores
and fuels are valued at lower of cost, based on first-in-first-
out method arrived at after including freight inward and other
expenditure directly attributable to acquisition or net realizable
value.
Net realizable value is the estimated selling price in the ordinary
course of business, less the estimated costs of completion and
sales.
H. FINANCIAL INSTRUMENTS
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/
payables and where cost of generation of fair value exceeds
benefits, which are initially measured at transaction price.
Transaction costs directly related to the acquisition or issue of
the financial assets and financial liabilities (other than financial
assets and financial liabilities through statement of profit &
loss) are added to or deducted from the cost of financial assets
or financial liabilities. Transaction cost directly attributed to the
acquisition of financial assets or financial liabilities at fair value
through statement of profit & loss are recognized immediately
in the statement of profit & loss.
Subsequent Recognition: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
(all being not held for trading), to present the subsequent
changes in fair value in other comprehensive income based
on its business model.
Fair value of the listed equity instruments are measured
using the rate quoted in the stock exchange wherein the
securities are actively traded as on the last working day
of the period of reporting. In respect of unlisted equity
instruments, fair value is determined based on the latest
audited financial statements and considering the open
market information available, failing which it shall be
measured at cost.
(iii) Financial assets at fair value through profit or loss: A
financial asset which is not classified in any of the above
categories (including investment in units of mutual funds)
is subsequently fair valued through profit or loss.
(iv) Financial liabilities: Financial liabilities are initially
recognized at the fair value of consideration received less
directly attributable transaction cost.
Financial liabilities are subsequently carried at amortized
cost using the effective interest method, the difference in
the initial carrying amount of the financial liabilities and
their redemption value is recognized in the statement of
profit & loss over the contractual term using the effective
interest rate 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.
Financial liabilities are further classified as current and
non-current depending whether they are payable within 12
months from the balance sheet date or beyond.
Financial liabilities are derecognized when the company is
discharged from its obligation; they expire, are cancelled or
replaced by a new liability with substantial modified terms.
(v) Investment in Subsidiaries/Joint ventures / Associates:
Investment in subsidiaries / Joint Ventures / Associates
are carried at cost less impairment, if any, in the separate
financial statements. Any gain or losses on disposal of
these investments are recognized in the statement of profit
& loss.
Derivative financial instruments
The Group holds derivative financial instruments to hedge its
interest rate risk exposures. Derivatives are initially measured
at fair value. Subsequent to initial recognition, derivatives are
measured at fair value, and changes therein are recognised
through profit or loss.
I. EARNING PER SHARE
Basic Earnings Per Share is computed by dividing the net profit
attributable to the equity shareholders of the company to the
weighted average number of Shares outstanding during the
period & Diluted earnings per share is computed by dividing
the net profit attributable to the equity shareholders of the
company after adjusting the effect of all dilutive potential
equity shares that were outstanding during the period. The
weighted average number of shares outstanding during
the period includes the weighted average number of equity
shares that could have issued upon conversion of all dilutive
potential.
J. TAXATION
Current Tax
Current tax is expected tax payable on the taxable income for
the year, using the tax rate enacted at the reporting date.
Current tax assets and liabilities are offset where the company
has legal enforceable right to offset and intends either to settle
on net basis, or to realize the assets and settle the liability
simultaneously.
Deferred Tax Assets and Liabilities
Deferred tax is recognized for all taxable temporary differences
and is calculated based on the carrying amounts of assets and
liabilities for financial reporting purposes and the amounts
used for taxation purposes.
Deferred tax is measured at the tax rates that are expected to
be applied when the asset is realized or the liability is settled,
based on the laws that have been enacted or substantively
enacted at the reporting date.
Deferred tax assets are recognized only to the extent that it is
probable that future taxable profits will be available against
which the assets can be utilized. 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 tax assets and liabilities are offset when there is a
legally enforceable right to offset.
Current and Deferred Tax for the Year
Current and deferred tax are recognized in the statement
of profit & loss, except when they relates to items that are
recognized in other comprehensive income or directly in equity,
in which case, the current tax and deferred tax is recognized
directly in other comprehensive income or equity as the case
may be.
K. EMPLOYEE BENEFITS
The company provides for the various benefits plans to the
employees. These are categorized into Defined Benefits
Plans and Defined Contributions Plans. Defined contribution
plans includes the amount paid by the company towards
the liability for Provident fund to the employees provident
fund organization, National Pension Scheme and Employee
State Insurance fund in respect of ESI and defined benefits
plans includes the retirement benefits, such as gratuity and
paid absences (leave benefits) both accumulated and non-
accumulated.
a. In respect of Defined Contribution Plans, contribution
made to the specified fund based on the services rendered
by the employees are charged to Statement of Profit & Loss
in the year in which services are rendered by the employee.
b. Liability in respect of Defined Long Term benefit plan
is determined at the present value of the amounts
payable determined using actuarial valuation techniques
performed by an independent actuarial at each balance
sheet date using the projected unit credit methods. Re¬
measurement, comprising actuarial gain and losses, the
effects of assets ceiling (if applicable) and the return on
plan assets (excluding interest), are reflected immediately
in the statement of Financial Position with a charge or
credit recognized in other comprehensive income in the
period in which they occur. Past Service cost is recognized
in the statement of profit & loss in the period of plan
amendment.
c. Liabilities for accumulating paid absences is determined
at the present value of the amounts payable determined
using the actuarial valuation techniques performed by an
independent actuarial at each balance sheet date using
the projected unit credit method. Actuarial gain or losses
in respect of accumulating paid absences are charged to
statement of profit & loss account.
d. Liabilities for short term employee benefits are measured
at undiscounted amount of the benefits expected to be
paid and charged to Statement of Profit & Loss in the year
in which the related service is rendered.
L. GOVERNMENT GRANTS
Government grants are recognized when there is reasonable
assurance that the entity will comply with the conditions
attaching to them and the grants will be received.
Grants received as part of package of financial aids to which
the number of conditions are attached, the grant is initially
recognized as liability and proportionately transferred to the
reserves on fulfillment of the conditions attached to it.
Grants received as part of investment in the specific fixed asset
is reduced from the cost of that asset at the time of receipt of
the Grant.
Revenue Grants are recognized in the statement of Profit & Loss.
M. IMPAIRMENT
Financial assets
The company recognizes the impairment on financial assets
based on the expected credit loss model for the financial
assets which are not fair value through statement of profit and
loss. Loss allowance on trade receivables, with no significant
financing component is measured at an amount equal to
lifetime expected credit loss. 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
recognized is recognized as an impairment gain or loss in the
statement of profit and loss for the period.
Intangible assets, investment property and property, plant and
equipment
Intangible assets, investment property and property plant &
equipment are evaluated for recoverability wherever events or
changes in circumstances indicate that their carrying amount
may not be recoverable.
For impairment testing, assets that do not generate independent
cash flows are grouped together into cash generating units
(CGUs).
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 asset is 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 & loss if
there have been changes in the estimates used to determine
the recoverable amount. The carrying amount is increased
to its revised recoverable amount, provided that this amount
does not exceeds the carrying amount that would have
been determined (net of any accumulated amortization or
depreciation) had no impairment loss has been recognized for
the asset in prior years.
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