We have audited the accompanying standalone financial statements
of Premier Explosives Limited ("the Company"), which comprise
the Balance Sheet as at March 31,2025, and the Statement of Profit
and Loss (including Other Comprehensive Income), the Statement of
Changes in Equity and the Statement of Cash Flows for the year then
ended, and a summary of significant accounting policies and other
explanatory information (hereafter referred to as the "standalone
financial statements").
In our opinion and to the best of our information and according
to the explanations given to us, the aforesaid standalone financial
statements give the information required by the Companies Act, 2013
(the "Act") in the manner so required and give a true and fair view in
conformity with the Indian Accounting Standards prescribed under
section 133 of the Act read with the Companies (Indian Accounting
Standards) Rules, 2015, as amended, ("Ind AS") and other accounting
principles generally accepted in India, of the state of affairs of the
Company as at March 31, 2025, and its profit, total comprehensive
income, the changes in equity and its cash flows for the year ended
on that date.
Basis for Opinion
We conducted our audit in accordance with the Standards on Auditing
(SAs) specified under section 143(10) of the Act. Our responsibilities
under those Standards are further described in the Auditor's
Responsibility for the Audit of the Standalone Financial Statements
section of our report. We are independent of the Company in
accordance with the Code of Ethics issued by the Institute of Chartered
Accountants of India (ICAI) together with the ethical requirements
that are relevant to our audit of the standalone financial statements
under the provisions of the Act and the Rules made thereunder and
we have fulfilled our other ethical responsibilities in accordance with
these requirements and the ICAI's Code of Ethics. We believe that the
audit evidence obtained by us is sufficient and appropriate to provide
a basis for our opinion on the standalone financial statements.
Key Audit Matters
Key audit matters are those matters that, in our professional judgment,
were of most significance in our audit of the standalone financial
statements of the current period. These matters were addressed in
the context of our audit of the standalone financial statements as a
whole, and in forming our opinion thereon, and we do not provide a
separate opinion on these matters. we have determined the matters
described below to be the key audit matters to be communicated in
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Sr. No. Key Audit Matter
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Auditor's Response
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1 Fair value assessment of trade receivables:
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Principal audit procedures performed:
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Trade receivables comprise a significant portion of the liquid
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• We have Performed Audit confirmation procedures and
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assets of the Company.
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due to non-response of the same, we performed alternative
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As indicated in Note no 11 to the standalone Ind AS financial
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procedures as below to assess the validity outstanding
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statements, 20.50% of the trade receivables are past due
more than 180 days. The most significant portion of the
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receivables.
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trade receivables over 180 days comprises of Public Sector
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• We verified payments received subsequent to year-end
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companies and Government organisations which are within
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against the outstanding amounts as on March 31,2025.
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their historic payment patterns.
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• Verified client source documentation to provide evidence for
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Company applies the simplified approach and recognises.
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the existence assertion of the receivables.
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Expected credit loss (ECL) for trade receivable balances (refer
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• Performed Analytical procedures for revenue recognised
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Note No 32(A)).
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to find out unusual patterns in sales to identify potentially
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Trade receivables have been assessed on a collective basis as
they possess shared credit risk characteristics, by grouping
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impaired balances.
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days past due of customers.
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• Enquiries with respective Marketing managers and with those
charged with governance about long outstanding customer
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Accordingly, the estimation of the Expected Credit Losses
allowances on trade receivables outstanding as at year end
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balances.
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is a significant judgement area, hence considered as a key
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• The assessment of the appropriateness of the ECL allowance
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audit matter.
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for trade receivables comprised of audit procedures including:
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(Trade receivables outstanding as at March 31, 2025 -
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1) We assessed management's ECL impairment model
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3807.81 lakhs - which is 26.34% of total financial assets)
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consistent with the requirements of IND AS 109;
2) We tested the mathematical accuracy of Management's
ECL impairment model;
3) We agreed the data utilised in Management's ECL
impairment model at March 31, 2025 to receivables
aging report, calculations and other audited information;
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Sr. No. Key Audit Matter
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Auditor's Response
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4) We challenged assumptions and judgements made by
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Management through discussion, comparison to data
and our knowledge of the operations as gained through
our audit in determining future expected loss rates
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2 Revenue Recognition (as described in note 2.5 of the
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Principal audit procedures performed:
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standalone financial statements)
Revenue from the sale of goods includes estimation of
variable consideration on account of powder factor which is
based on the agreement with the customer and, the volume
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• Evaluated the Company's accounting policies related to
revenue recognition and assessed their compliance with Ind
AS 115 (Revenue from Contracts with Customers).
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of output achieved at the site, which is measured at a later
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• Reviewing the relevant correspondence with customers
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date when the product is actually used by the customer.
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to validate the terms related to the powder factor for prior
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Accordingly, the deduction is made on current sales based
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periods.
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on estimates made from technical evaluation and historical
data associated with such services for the likely powder
factor. There is substantial time gap between the provision
made by the Company and the determination of the actual
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• Assessed the key management assumptions and judgments
related to various parameters used for measuring and
estimating the amount of powder factor provisions.
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of powder factor deduction by the customer.
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• Evaluated the historical trend against the actual powder factor
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This is considered a key audit matter because it involves
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deductions.
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significant judgment and estimation to determine the
percentage of blast output achieved. The settlement of this
percentage will occur in the future based on the terms of the
contract and mutual agreement.
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• Assessed and read the disclosures made by the Company in
the standalone financial statements.
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Information Other than the Financial Statements and Auditor's Report Thereon
• The Company's Board of Directors is responsible for the other
information. The other information comprises the information
included in the Management Discussion and Analysis, Board's
Report including Annexures to Board's Report, Corporate
Governance and Shareholder's Information, but does not
include the consolidated financial statements, standalone
financial statements and our auditor's report thereon. These
reports comprising other information are expected to be made
available to us after the date of this auditor's report.
• Our opinion on the standalone financial statements does not
cover the other information and will not express any form of
assurance conclusion thereon.
• In connection with our audit of the standalone financial
statements, our responsibility is to read the other information
and, in doing so, consider whether the other information is
materially inconsistent with the standalone financial statements
or our knowledge obtained during the course of our audit or
otherwise appears to be materially misstated.
• When we read the Management Discussion and Analysis, Board's
Report including Annexures to Board's Report, Corporate
Governance and Shareholder's Information, if we conclude that
there is a material misstatement therein, we are required to
communicate the matter to those charged with governance as
required under SA 720 'The Auditor's responsibilities Relating to
Other Information'.
Management's Responsibility for the Standalone Financial
Statements
The Company's Board of Directors is responsible for the matters
stated in section 134(5) of the Act with respect to the preparation
of these standalone financial statements that give a true and fair
view of the financial position, financial performance including
other comprehensive income, cash flows and changes in equity of
the Company in accordance with the Ind AS and other accounting
principles generally accepted in India. This responsibility also includes
maintenance of adequate accounting records in accordance with the
provisions of the Act for safeguarding the assets of the Company
and for preventing and detecting frauds and other irregularities;
selection and application of appropriate accounting policies;
making judgments and estimates that are reasonable and prudent;
and design, implementation and maintenance of adequate internal
financial controls, that were operating effectively for ensuring the
accuracy and completeness of the accounting records, relevant to the
preparation and presentation of the standalone financial statement
that give a true and fair view and are free from material misstatement,
whether due to fraud or error.
In preparing the standalone financial statements, Board of Directors is
responsible for assessing the Company's ability to continue as a going
concern, disclosing, as applicable, matters related to going concern
and using the going concern basis of accounting unless management
either intends to liquidate the Company or to cease operations, or has
no realistic alternative but to do so.
The Board of Directors are also responsible for overseeing the
Company's financial reporting process.
Auditor's Responsibility for the Audit of the Standalone Financial
Statements
Our objectives are to obtain reasonable assurance about whether
the standalone financial statements as a whole are free from material
misstatement, whether due to fraud or error, and to issue an auditor's
report that includes our opinion. Reasonable assurance is a high
level of assurance, but is not a guarantee that an audit conducted
in accordance with SAs will always detect a material misstatement
when it exists. Misstatements can arise from fraud or error and are
considered material if, individually or in the aggregate, they could
reasonably be expected to influence the economic decisions of users
taken on the basis of these standalone financial statements.
As part of an audit in accordance with SAs, we exercise professional
judgment and maintain professional skepticism throughout the
audit. We also:
• Identify and assess the risks of material misstatement of the
standalone financial statements, whether due to fraud or error,
design and perform audit procedures responsive to those risks,
and obtain audit evidence that is sufficient and appropriate
to provide a basis for our opinion. The risk of not detecting a
material misstatement resulting from fraud is higher than for
one resulting from error, as fraud may involve collusion, forgery,
intentional omissions, misrepresentations, or the override of
internal control.
• Obtain an understanding of internal financial control relevant
to the audit in order to design audit procedures that are
appropriate in the circumstances. Under section 143(3)(i) of
the Act, we are also responsible for expressing our opinion on
whether the Company has adequate internal financial controls
system in place and the operating effectiveness of such controls.
• Evaluate the appropriateness of accounting policies used
and the reasonableness of accounting estimates and related
disclosures made by the management.
• Conclude on the appropriateness of management's use of the
going concern basis of accounting and, based on the audit
evidence obtained, whether a material uncertainty exists
related to events or conditions that may cast significant doubt
on the Company's ability to continue as a going concern. If we
conclude that a material uncertainty exists, we are required to
draw attention in our auditor's report to the related disclosures
in the standalone financial statements or, if such disclosures are
inadequate, to modify our opinion. Our conclusions are based
on the audit evidence obtained up to the date of our auditor's
report. However, future events or conditions may cause the
Company to cease to continue as a going concern.
• Evaluate the overall presentation, structure and content of the
standalone financial statements, including the disclosures, and
whether the standalone financial statements represent the
underlying transactions and events in a manner that achieves
fair presentation.
We communicate with those charged with governance regarding,
among other matters, the planned scope and timing of the audit and
significant audit findings, including any significant deficiencies in
internal control that we identify during our audit.
We also provide those charged with governance with a statement
that we have complied with relevant ethical requirements regarding
independence, and to communicate with them all relationships
and other matters that may reasonably be thought to bear on our
independence, and where applicable, related safeguards.
From the matters communicated with those charged with governance,
we determine those matters that were of most significance in the
audit of the standalone financial statements of the current period and
are therefore the key audit matters. We describe these matters in our
auditor's report unless law or regulation precludes public disclosure
about the matter or when, in extremely rare circumstances, we
determine that a matter should not be communicated in our report
because the adverse consequences of doing so would reasonably
be expected to outweigh the public interest benefits of such
communication.
Report on Other Legal and Regulatory Requirements
1. As required by Section 143(3) of the Act, based on our audit we
report that:
a) We have sought and obtained all the information and
explanations which to the best of our knowledge and
belief were necessary for the purposes of our audit.
b) In our opinion, proper books of account as required by law
have been kept by the Company so far as it appears from
our examination of those books.
c) The Balance Sheet, the Statement of Profit and Loss
including Other Comprehensive Income, Statement of
Changes in Equity and the Statement of Cash Flows dealt
with by this Report are in agreement with the books of
account.
d) In our opinion, the aforesaid standalone financial
statements comply with the Ind AS specified under Section
133 of the Act.
e) On the basis of the written representations received from
the directors as on March 31,2025 taken on record by the
Board of Directors, none of the directors is disqualified as
on March 31, 2025, from being appointed as a director in
terms of Section 164 (2) of the Act.
f) With respect to the adequacy of the internal financial
controls over financial reporting of the Company and
the operating effectiveness of such controls, refer to our
separate Report in "Annexure A". Our report expresses
Unmodified opinion on the operating effectiveness of
the Company's internal financial controls over financial
reporting.
g) With respect to the other matters to be included in the
Auditor's Report in accordance with the requirements of
section 197(16) of the Act, as amended,
In our opinion and to the best of our information and
according to the explanations given to us, the remuneration
paid by the Company to its directors during the year is in
accordance with the provisions of section 197 of the Act.
h) With respect to the other matters to be included in
the Auditor's Report in accordance with Rule 11 of the
Companies (Audit and Auditors) Rules, 2014, as amended
in our opinion and to the best of our information and
according to the explanations given to us:
i. The company has disclosed the impact of pending
litigation on its financial position as stated in note no
34 to the Standalone Ind AS Financial Statements.
ii. The Company has made provision, as required
under the applicable law or accounting standards,
for material foreseeable losses, if any, on long-term
contracts, the company doesn't have derivative
contracts;
iii. There has been no delay in transferring amounts,
required to be transferred, to the Investor Education
and Protection Fund by the Company.
iv. (a) The Management has represented that, to
the best of its knowledge and belief, no funds
(which are material either individually or in the
aggregate) have been advanced or loaned or
invested (either from borrowed funds or share
premium or any other sources or kind of funds)
by the Company to or in any other person or
entity, including foreign entity ("Intermediaries"),
with the understanding, whether recorded in
writing or otherwise, that the Intermediary
shall, whether, directly or indirectly lend or
invest in other persons or entities identified in
any manner whatsoever by or on behalf of the
Company ("Ultimate Beneficiaries") or provide
any guarantee, security or the like on behalf of
the Ultimate Beneficiaries;
(b) The Management has represented, that, to
the best of its knowledge and belief, no funds
(which are material either individually or in
the aggregate) have been received by the
Company from any person or entity, including
foreign entity ("Funding Parties"), with the
understanding, whether recorded in writing
or otherwise, that the Company shall, whether,
directly or indirectly, lend or invest in other
persons or entities identified in any manner
whatsoever by or on behalf of the Funding
Party ("Ultimate Beneficiaries") or provide any
guarantee, security or the like on behalf of the
Ultimate Beneficiaries;
(c) Based on the audit procedures that have been
considered reasonable and appropriate in
the circumstances, nothing has come to our
notice that has caused us to believe that the
representations under sub-clause (i) and (ii) of
Rule 11(e), as provided under (a) and (b) above,
contain any material misstatement.
v. As stated in Note 45 to the standalone Ind AS financial
statements
a) The dividend declared and paid during the year
by the Company is in compliance with Section
123 of the Act.
b) The company has not issued any interim
dividend during the year.
c) The Board of Directors of the Company have
proposed final dividend for the year which is
subject to the approval of the members at the
ensuing Annual General Meeting. The amount
of dividend proposed is in accordance with
section 123 of the Act, as applicable.
vi. Based on our examination, which included test
checks, the Company has used accounting software
for maintaining its books of account for the financial
year ended March 31, 2025 which has the feature of
recording audit trail (edit log) facility and the same
has operated throughout the year for all relevant
transactions recorded in the software. Further, during
the course of our audit we did not come across any
instance of the audit trail feature being tampered
with.
2. As required by the Companies (Auditor's Report) Order, 2020
("the Order") issued by the Central Government in terms of
Section 143(11) of the Act, we give in "Annexure B" a statement
on the matters specified in paragraphs 3 and 4 of the Order.
For MAJETI & CO
Chartered Accountants
Firm's Registration No: 015975S
Kiran Kumar Majeti
Partner
Membership No:220354
UDIN: 25220354BMOFXY4089
Place: Hyderabad
Date: May 22, 2025
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