(2) Material Accounting Policies:

(i) Basis of preparation

The Financial Statements comply with Indian Accounting Standards (Ind AS) notified under the Companies (Indian
Accounting Standard) Rules, 2015 and Companies (Indian Accounting Standards) Amendment Rules, 2016.

Principles generally accepted in India as prescribed under Section 133 of the Act, read with Rule 7 of the Companies
(Accounts) Rule, 2014 (IGAAP), which was the previous GAAP

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.

(ii) Use of Estimates

Preparation of financial statements in conformity with Ind AS requires the management to make estimates and
assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent liabilities
on the date of the financial statements. Management believes that the estimates made in the preparation of the
financial statements are prudent and reasonable. Actual results could differ from those estimates. Any revision of
accounting estimates is recognized prospectively in current and future periods.

(iii) Current / Non-Current classification

The normal operating cycle of the Company is 12 months. Assets and Liabilities which are expected to be realizable
/ payable within 12 months are to be classified as current and rest will be classified as non-current.

(iv) Revenue Recognition

Revenue from sale of products is recognized on transfer of all significant risk and rewards of ownership to the
customers, which is generally on dispatch of goods and no significant uncertainty exists regarding the amount of
the consideration that will be derived from the sale of goods. Sales are stated exclusive of GST and net of trade
discount and quantity discount.

Dividend Income is recognized when the right to receive the dividend is established.

Interest Income is recognized on time proportion basis.

Export incentives / benefits are accounted for on accrual basis on value of exports affected during the year under
consideration.

(v) Income tax

Current income tax assets and liabilities are measured at the amount expected to be recovered from or paid to the
taxation authorities.

Current income tax relating to items recognised outside profit or loss is recognised outside profit or loss (either in
other comprehensive income or in equity).

Deferred tax is provided using the balance sheet approach on temporary differences at the reporting date between
the tax bases of assets and liabilities and their carrying amount for financial reporting purposes at their reporting
date.

Deferred tax assets and liabilities are measured at the tax rates that are expected to apply in the year when the
asset is realised 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 recognised outside profit or loss is recognised outside profit or loss (either in other
comprehensive income or in equity).

(vi) Property, plant and equipment

(a) Freehold land is carried at historical cost. All other property, plant and equipment are shown at cost (net of
adjustable taxes) less accumulated depreciation and accumulated impairment losses. The cost of an asset
comprises of its purchase price, non refundable / adjustable purchase taxes and any cost directly attributable
to bringing the asset into the location and condition necessary for it to be capable of operating in the manner
intended by the management, the initial estimate of any decommissioning obligation, if any and for assets that
necessarily take a substantial period of time to get ready for their intended use, finance costs. The purchase
price is the aggregate amount paid and the fair value of any other consideration given to acquire the asset.
The cost also includes trial run cost and other operating expenses such as freight, installation charges etc.
The projects under construction are carried at costs comprising of costs directly attributable to bringing the
asset to the location and condition necessary for it to be capable of operating in the manner intended by
management and attributable borrowing costs.

(b) Stores and spares which meet the definition of property, plant and equipment and satisfy the recognition
criteria of Ind AS 16 are capitalized as property, plant and equipment.

(c) 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.

(d) 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 or significant part) is included in the Statement of Profit and Loss when the asset is
derecognized.

(e) In line with the provisions of Schedule II to the Companies Act, 2013, the Company depreciates significant
components of the main asset (which have different useful lives as compared to the main asset) based on the
individual useful life of those components. Useful life for such components of property, plant and equipment
has been assessed based on the historical experience and internal technical inputs.

(f) Depreciation on property, plant and equipment is provided as per straight line method based on useful life
prescribed under Schedule II to the Companies Act, 2013. The Company has assessed the estimated useful
lives of its property, plant and equipment and has adopted the useful lives and residual value as prescribed in
Schedule II.

The property, plant and equipment acquired under finance lease are depreciated over the period of lease.
Depreciation on stores and spares specific to an item or property, plant and equipment is based on life of
the related property, plant and equipment. In other cases, the stores and spares are depreciated over their
estimated useful life based on the technical assessment.

(g) The residual values and useful lives of property, plant and equipment are reviewed at each financial year end,
and changes, if any, are accounted prospectively.

(h) Capital work-in-progress includes cost of property, plant and equipment under installation / under development
as at the balance sheet date. These are stated at cost to date relating to items or project in progress, incurred
during construction / preoperative period. Advances given towards acquisition or construction of PPE
outstanding at each reporting date are disclosed as Capital Advances under “Other non-current Assets”.

(vii) Intangible assets

Intangible assets are recognised when it is probable that the future economic benefits that are attributable to the

assets will flow to the Company and the cost of the asset can be measured reliably.

Intangible assets comprising of “Computer Software” are recorded at acquisition cost and are amortized over the

estimated useful life on straight line basis. Estimated useful life of software is assessed to be 10 years.

(viii) Inventories

Inventories comprise all cost of purchase, cost of conversion and other costs including manufacturing overheads

incurred in bringing the inventories to their present location and condition.

The Inventories [Raw Materials, Traded Goods, Packaging Material, Stock in transit (RM) and Stock with Third
Parties (RM)] are valued at lower of cost and net realizable value on First-In-First-Out basis (FIFO).

The Work-in-process and finished goods valued at the batch cost which comprises of cost of raw material,
manufacturing expenses, labour charges and other direct expenses.

Stores and Spares are charged to the statement of profit and loss in the year of purchase.

(ix) Foreign currency Transactions

(a) Initial Recognition

Foreign currency transactions are recorded in the reporting currency, by applying to the foreign currency
amount the exchange rate between the reporting currency and the foreign currency at the date of the
transaction.

(b) Conversion

Foreign currency monetary items are retranslated using the exchange rate prevailing at the reporting date.
Non-monetary items, which are measured in terms of historical cost denominated in a foreign currency, are
reported using the exchange rate at the date of the transaction. Non-monetary items, which are measured at
fair value or other similar valuation denominated in a foreign currency, are translated using the exchange rate
at the date when such value was determined.

(c) Exchange Differences

Exchange differences arising on the settlement of monetary items or on reporting such monetary items of
Company at rates different from those at which they were initially recorded during the year, or reported in
financial statements, are recognized as income or as expenses in the year in which they arise.

(d) Forward Contracts

The premium or discount arising at the inception of forward exchange contracts is booked as expense or
income immediately. Exchange differences on such contracts are recognized in the Statement of Profit and
Loss in the year in which the exchange rates changes. Any profit or loss arising on cancellation or renewal of
forward exchange contract is recognized as income or as expense for the year.

(x) Employee benefits

All employee benefits payable wholly within 12 months of rendering services are classified as short term employee
benefits. Benefits such as salaries, wages, short-term compensated absences, performance incentives etc., and
the expected cost of bonus, ex-gratia are recognised during the period in which the employee renders related
service.

Retirement benefits in the form of Provident Fund, Employee State Insurance and Superannuation Fund is a
defined contribution scheme and the contributions are charged to the Statement of Profit and Loss of the year when
the contributions to the respective funds are due. There are no other obligations other than the contribution payable
to the respective funds.

Defined Contribution plan:

Retirement benefits in the form of Provident Fund are a defined contribution scheme and the contributions are
charged to the profit and loss account of the year when the contributions to the respective fund are due. There are
no other obligations other than the contribution payable to the respective fund.

Defined Benefit Plans:

The Company contributes to a gratuity fund which has taken a group policy with Life Insurance Corporation of India
for future payments of gratuity to retiring employees. The premium has been so adjusted as to cover the liability
under the scheme in respect of all employees at the end of their future anticipated services with the company.

(xi) Leases

The Company assesses at contract inception whether a contract is, or contains, a lease. A contract is, or contains, a
lease if it conveys the right to control the use of an identified asset for a period of time in exchange for consideration.

Company as Lessee

The Company's lease asset classes primarily consist of leases for land and buildings. The Company assesses
whether a contract contains a lease, at inception of a contract. 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. To
assess whether a contract conveys the right to control the use of an identified asset, the Company assesses
whether: (i) the contract involves the use of an identified asset (ii) the Company has substantially all of the economic
benefits from use of the asset through the period of the lease and (iii) the Company has the right to direct the use
of the asset

At the date of commencement of the lease, the Company recognizes a right-of-use asset (“ROU”) and a
corresponding lease liability for all lease arrangements in which it is a lessee, except for leases with a term of twelve
months or less (short-term leases) and low value leases. For these short-term and low value leases, the Company
recognizes the lease payments as an operating expense on a straight-line basis over the term of the lease.

Certain lease arrangements includes the options to extend or terminate the lease before the end of the lease term.
ROU assets and lease liabilities includes these options when it is reasonably certain that they will be exercised.

The right-of-use assets are initially recognized at cost, which comprises the initial amount of the lease liability
adjusted for any lease payments made at or prior to the commencement date of the lease plus any initial direct
costs less any lease incentives. They are subsequently measured at cost less accumulated depreciation and
impairment losses.

Right-of-use assets are depreciated from the commencement date on a straight-line basis over the shorter of the
lease term and useful life of the underlying asset. Right of use assets 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 Cash Generating Unit
(CGU) to which the asset belongs.

The lease liability is initially measured at amortized cost at the present value of the future lease payments. The
lease payments are discounted using the interest rate implicit in the lease or, if not readily determinable, using
the incremental borrowing rates in the country of domicile of these leases. Lease liabilities are remeasured with a
corresponding adjustment to the related right of use asset if the Company changes its assessment if whether it will
exercise an extension or a termination option.

Lease liability and ROU asset have been separately presented in the Balance Sheet and lease payments have
been classified as financing cash flows.

(xii) Earnings per share

Basic earnings per share are calculated by dividing the net profit or loss for the period attributable to equity
shareholders by the weighted average number of equity shares outstanding during the period. For the purpose of
calculating diluted earnings per share, the net profit or loss for the period attributable to equity shareholders and the
weighted average number of shares outstanding during the period are adjusted for the effects of all dilutive potential
equity shares.