3.21 Provisions and contingencies
A provision is recognised in the financial statements
where there exists a present obligation as a result
of a past event, the amount of which can be reliably
estimated, and it is probable that an outflow of
resources would be necessitated in order to settle the
obligation. If the effect of the time value of money is
material, provisions are discounted using a current
pre-tax rate that reflects, when appropriate, the risks
specific to the liability. When discounting is used, the
increase in the provision due to the passage of time is
recognised as a finance cost. Provisions are reviewed
at each balance sheet date and adjusted to reflect
the current best estimates. Contingent liabilities
are not recognised but are disclosed in the notes
unless the outflow of resources is considered to be
remote. Contingent assets are neither recognised nor
disclosed in the financial statements.
3.22 Equity, reserves and dividend payments
Equity shares are classified as equity. Incremental
costs directly attributable to the issue of new shares/
buyback of shares are shown in equity as a deduction,
net of tax, from the proceeds.
Retained earnings include current and prior period
retained profits. All transactions with owners of the
Company are recorded separately within equity.
Dividend payable to equity shareholders are included
in other current financial liabilities when the dividends
have been approved in a general meeting prior to the
reporting date.
3.23 Earnings per share
Basic earnings or loss 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. The weighted average number of equity
shares outstanding during the period is adjusted
for events such as bonus issue, bonus element in a
rights issue, buyback, share split, and reverse share
split (consolidation of shares) that have changed
the number of equity shares outstanding, without a
corresponding change in resources.
For the purpose of calculating diluted earnings or
loss 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.
3.24 Fair value measurement
The Company measures financial instruments such
as investments in mutual funds, investment in
certain equity shares etc. at fair value at each balance
sheet date.
Fair value is the price that would be received to sell an
asset or paid to transfer a liability at the measurement
date.
All assets and liabilities for which fair value is measured
or disclosed in the financial statements are categorised
within the fair value hierarchy, described as follows,
based on the lowest level input that is significant to the
fair value measurement as a whole:
• Level 1 — Quoted (unadjusted) market prices in active
markets for identical assets or liabilities
• Level 2 — Valuation techniques for which the
lowest level input that is significant to the fair value
measurement is directly or indirectly observable
• Level 3 — Valuation techniques for which the
lowest level input that is significant to the fair value
measurement is unobservable.
For the purpose of fair value disclosures, the Company
has determined classes of assets and liabilities on the
basis of the nature, characteristics and risks of the
asset or liability and the level of the fair value hierarchy
as explained above.
3.25 Financial instruments
I. Financial assets
a. Initial recognition and measurement
All financial assets are recognised initially at fair
value plus, in case of financial assets not recorded
at fair value through profit or loss, transaction
costs that are attributable to the acquisition of
the financial asset, which are not at fair value
through profit and loss, are added to fair value on
initial recognition. Transaction costs of financial
assets carried at fair value through profit or loss
are expensed in statement of profit and loss.
However, trade receivables that do not contain a
significant financing component are measured at
transaction price.
b. Subsequent measurement
(i) Financial assets carried at amortised cost
A financial asset is subsequently measured at
amortised 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 (FVTOCI)
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.
(iii) Financial assets at fair value through profit or
loss (FVTPL)
A financial asset which is not classified in any of
the above categories are subsequently fair valued
through statement of profit and loss.
c. Impairment of financial assets
(i) The Company assesses on a forward looking
basis the expected credit losses (ECL) associated
with its assets measured at amortised cost
and assets measured at fair value through
other comprehensive income. The impairment
methodology applied depends on whether there
has been a significant increase in credit risk. Note
45 details how the Company determines whether
there has been a significant increase in credit risk.
(ii) Investments in subsidiaries, associates and
joint ventures are carried at cost/deemed cost
applied on transition to Ind AS, less accumulated
impairment losses, if any. Where an indication
of impairment exists, the carrying amount of
investment is assessed and an impairment
provision is recognised, if required immediately to
its recoverable amount, being the higher of value
in use or fair value less costs to sell. On disposal
of such investments, difference between the
net disposal proceeds and carrying amount is
recognised in the statement of profit and loss.
d. De-recognition of financial assets
A financial asset is derecognised when:
- The Company has transferred the right to
receive cash flows from the financial assets
or
- Retains the contractual rights to receive
the cash flows of the financial assets, but
assumes a contractual obligation to pay the
cash flows to one or more recipients.
Where the entity transfers the financial asset, it
evaluates the extent to which it retains the risk and
rewards of the ownership of the financial assets.
If the entity transfers substantially all the risks and
rewards of ownership of the financial asset, the
entity shall derecognise the financial asset and
recognise separately as assets or liabilities any
rights and obligations created or retained in the
transfer. If the entity retains substantially all the
risks and rewards of ownership of the financial
asset, the entity shall continue to recognise the
financial asset.
Where the entity has neither transferred a
financial asset nor retains substantially all risks
and rewards of the ownership of the financial
asset, the financial asset is derecognised if the
Company has not retained control of the financial
assets. Where the Company retains control
of the financial assets, the asset is continued
to be recognised to the extent of continuing
involvement in the financial asset.
II. Financial liabilities
a. Initial recognition and subsequent measurement
All financial liabilities are recognized initially at fair
value and in case of borrowings and payables, net
of directly attributable cost.
Financial liabilities are subsequently carried
at amortized cost using the effective interest
method. 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. Changes
in the amortised value of liability are recorded as
finance cost.
III. Fair value of financial instruments
In determining the fair value of its financial
instruments, the Company uses a variety of
methods and assumptions that are based
on market conditions and risks existing at
each reporting date. The methods used to
determine fair value include discounted cash
flow analysis, available quoted market prices. All
methods of assessing fair value result in general
approximation of value, and such value may vary
from actual realization on future date.
IV. Offsetting of financial instruments
Financial assets and financial liabilities are offset
and the net amount is reported in the balance
sheet if there is a currently enforceable legal right
to offset the recognised amounts and there is an
intention to settle on a net basis, to realise the
assets and settle the liabilities simultaneously.
3.26 Derivative financial instruments
The Company enters into a variety of derivative
financial instruments to manage its exposure to
interest rate and foreign exchange rate risks, including
foreign exchange forward contracts, interest rate
swaps and cross currency swaps. Further details
of derivative financial instruments are disclosed in
note 45.
Derivatives are initially recognised at fair value at the
date the derivative contracts are entered into and
are subsequently re-measured to their fair value at
the end of each reporting period. The resulting gain
or loss is recognised in statement of profit and loss
immediately unless the derivative is designated and
effective as a hedging instrument, in which event the
timing of the recognition in the statement of profit and
loss depends on the nature of the hedging relationship
and the nature of the hedged item.
3.27 Segment reporting
Operating segments are reported in a manner
consistent with the internal reporting provided to
the chief operating decision maker. The Company
has mainly two operating/reportable segments:
Packaging Products segment and Investment Property
segment. In identifying these operating segments,
management generally follows the company's service
lines representing its main products and services. Each
of these operating segments is managed separately
as each requires different technologies, marketing
approaches and other resources.
All inter-segment transfers are carried out at arm's
length prices based on prices charged to unrelated
customers in standalone sales of identical goods or
services.
For management purposes, the Company uses the
same measurement policies as those used in its
financial statements. In addition, unallocated assets
which are not directly attributable to the business
activities of any operating segment are not allocated
to a segment.
3.28 Significant accounting judgements, estimates
and assumptions
The preparation of the Company's financial
statements requires management to make
judgments, estimates and assumptions that affect
the reported amounts of revenues, expenses, assets
and liabilities, and the accompanying disclosures, and
the disclosure of contingent liabilities. Uncertainty
about these assumptions and estimates could result
in outcomes that require a material adjustment to
the carrying amount of assets or liabilities affected in
future periods.
3.29 Non-Current Assets Held for Sale and
Discontinued operations:
Non-current assets or disposal groups comprising
of assets and liabilities are classified as 'held for sale'
when all the following criteria are met:
(i) Decision has been made to sell,
(ii) The assets are available for immediate sale in its
present condition,
(iii) The assets are being actively marketed and
(iv) Sale has been agreed or is expected to be
concluded within 12 months of the balance sheet
date.
Subsequently, such non-current assets and disposal
groups classified as 'held for sale' are measured at
the lower of its carrying value and fair value less costs
to sell.
Non-current assets held for sale are not depreciated
or amortised.
Discontinued operation is a component of the
Company that has been disposed of or classified as
held for sale.
3.30 Estimates and assumptions
The key assumptions concerning the future and other
key sources of estimation uncertainty at the reporting
date, that have a significant risk of causing a material
adjustment to the carrying amounts of assets and
liabilities within the next financial year, are described
below. The Company based its assumptions and
estimates on parameters available when the financial
statements were prepared. Existing circumstances and
assumptions about future developments, however,
may change due to market changes or circumstances
arising that are beyond the control of the Company.
Such changes are reflected in the assumptions when
they occur.
(i) Estimation of defined benefit obligation
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 attrition rate. Due
to the complexities involved in the valuation and
its long-term nature, a defined benefit obligation is
highly sensitive to changes in these assumptions.
All assumptions are reviewed at each reporting
date.
(ii) Estimation of current tax and deferred tax
Management judgment is required for the
calculation of provision for income - taxes and
deferred tax assets and liabilities. The Company
reviews at each balance sheet date the carrying
amount of deferred tax assets. The factors used
in estimates may differ from actual outcome
which could lead to adjustment to the amounts
reported in the financial statements.
(iii) Useful lives of depreciable assets
Management reviews its estimate of the useful
lives of depreciable assets at each reporting
date, based on the expected utility of the
assets. Uncertainties in these estimates relate to
technological obsolescence that may change the
utility of certain property, plant and equipment.
(iv) Impairment of trade receivables
Trade receivables do not carry any interest
and are stated at their normal value as reduced
by appropriate allowances for estimated
irrecoverable amounts. Individual trade
receivables are written off when management
deems them not to be collectible. Impairment is
recognised based on the expected credit losses,
which are the present value of the cash shortfall
over the expected life of the financial assets.
(v) Fair value measurement
Management uses valuation techniques to
determine the fair value of financial instruments
(where active market quotes are not available)
and non-financial assets. This involves developing
estimates and assumptions consistent with how
market participants would price the instrument.
Management bases its assumptions on
observable data as far as possible but this is not
always available. In that case management uses
the best information available. Estimated fair
values may vary from the actual prices that would
be achieved in an arm's length transaction at the
reporting date (refer note 46).
(vi) Impairment of Goodwill
Goodwill is tested for impairment on an annual
basis and whenever there is an indication that
the recoverable amount of a cash generating
unit is less than its carrying amount based on a
number of factors including operating results,
business plans, future cash flows and economic
conditions. The recoverable amount of cash
generating units is determined based on higher
of value-in-use and fair value less cost to sell.
The goodwill impairment test is performed at
the level of the cash-generating unit or groups
of cash-generating units which are benefitting
from the synergies of the acquisition and which
represents the lowest level at which goodwill is
monitored for internal management purposes.
Market related information and estimates are
used to determine the recoverable amount. Key
assumptions on which management has based
its determination of recoverable amount include
estimated long term growth rates, weighted
average cost of capital and estimated operating
margins. Cash flow projections take into account
past experience and represent management's
best estimate about future developments.
(c) Terms and rights attached to equity shares
The Company has issued only one class of equity shares having par value of H 2 per share. Each holder of equity share
is entitled to one vote per share. The Company declares and pays dividend in Indian Rupees. The dividend proposed
by the board of directors is subject to the approval of the shareholders in the ensuing Annual General Meeting. In the
event of liquidation of the Company, the holder of equity shares will be entitled to receive remaining assets of the
Company, after settling of all liabilities. The distribution will be in proportion to the number of equity shares held by
the shareholders.
(e) The Company has not issued any equity shares as bonus or for consideration other than cash during the period of five
years immediately preceding 31 March 2026.
(f) The above figure of subscribed and paid up capital includes application and allotment money received on forfeited
shares amounting to H 0.04 lakh (Previous year H 0.04 lakh).
(g) During the year 2020-21, pursuant to the buyback offer dated 21st September 2020, the Company, has bought back
75,99,014 equity shares. As a result, the paid-up capital of the Company stands reduced from H 1,445.93 lakh to
H 1,293.95 lakh and from securities premium account H 151.98 lakh was transferred to capital redemption reserve on
buyback and cancellation of equity shares. The premium on buy back, buyback expenses and tax on distributable
profit (as per section 115 QA of the income tax act, 1961) of H 7,688.00 lakh was utilised from securities premium
account.
Notes:
1. Loans are secured by way of hypothecation of first pari-passu charge on movable fixed assets (both present and
future) pertaining to the glass plants of the Company situated at Sanathnagar and Bhongir in Telangana. Further,
this is secured by first pari-passu charge by way of mortgage of deposit of title deeds of immovable properties
(both present and future) of glass plants of the Company situated at Sanathnagar and Bhongir in Telangana.
- Term Loans aggregating to Nil (previous year H 6,161.86 lakh) has been fully repaid/voluntary prepaid during the
current year.
- Term Loans aggregating to H 3,800.00 lakh (previous year H 5,300.00 lakh) are repayable in total 8 quarterly
instalments from June 2026 to March 2028.
- Term Loans aggregating to H 7,099.56 lakh (previous year H 14,499.73 lakh) are repayable in total 8 quarterly
instalments from June 2026 to March 2028.
- Term Loans aggregating to H 1,875.00 lakh (previous year H 9,250.00 lakh) are repayable in total 4 quarterly
instalments from June 2026 to March 2027.
- Term Loans aggregating to H 3,000.00 lakh (previous year H 9,000.00 lakh) are repayable in total 4 half yearly
instalments from September 2026 to March 2028.
- Term Loans aggregating to H 4,744.00 lakh (previous year Nil) are repayable in total 28 quarterly instalments from
March 2029 to December 2035.
2. Loan is secured by first pari-passu charge on fixed assets of the Company located at Sitarampur, Isnapur, PO Medak
District, Hyderabad, Telangana.
- Term Loans aggregating to Nil (previous year H 4,000.00 lakh) has been fully repaid/voluntary prepaid during the
current year.
3. Deferred payment liabilities from Telanagan State Government (unsecured) is in respect of value added tax and
central sales tax liabilities pertaining to the years 1999-2000 to 2012-2013 and are repayable by the end of financial
year 31 March 2030.
- Deferred payment liabilities aggregating to H 1,468.32 lakh (previous year H 1,790.58 lakh) are repayable in yearly
instalments from June 2026 to March 2030.
Details of security and term of repayment of each type of borrowing:
Secured borrowings
a) Cash credit facilities:
Cash credit facilities from banks is repayable on demand and is secured by hypothecation of all current assets including
stocks and book debts, present and future, and further secured by second pari-passu charge on all the movable fixed
assets (both present and future) of the Company situated at Sanathnagar plant and Bhongir plant.
b) Working capital loan facilities:
Working capital demand loan from banks repayable within 30 days from disbursement and is secured by hypothecation
of all current assets including stocks and book debts including advance to suppliers present and future, and further
secured by second pari-passu charge on all the movable fixed assets excluding vehicles (both present and future) of
the Company situated at Sanathnagar plant and Bhongir plant including speciality division.
c) The Company has been sanctioned a working capital limit in excess of H 5 crore, in aggregate, at points of time during
the year, from bank on the basis of security of current assets. The Company has filed quarterly returns or statements
with the banks in lieu of the sanctioned working capital facilities, which are in agreement with the books of account
other than those as set out below.
NOTE 45 FINANCIAL INSTRUMENTS AND RISK REVIEW
Capital management
The Company manages its capital to be able to continue as a going concern while maximising the returns to shareholders
through optimisation of the debt and equity balance. The capital structure consists of debt which includes the borrowings
as disclosed in note 22 and 28 and net cash and cash equivalents as disclosed in note 15 and equity attributable to
equityholders of the Company, comprising issued share capital, reserves and retained earnings as disclosed in the
Statement of changes in equity. For the purpose of calculating gearing ratio, debt is defined as non current and current
borrowings (excluding derivatives). Equity includes all capital and reserves of the Company attributable to equity holders
of the Company. The Company is not subject to externally imposed capital requirements. The Board reviews the capital
structure and cost of capital on an annual basis but has not set specific targets for gearing ratios. The risks associated
with each class of capital are also considered as part of the risk reviews presented to the Audit Committee and the
Board of Directors.
Financial risk management objective
The Company is exposed to various risks in relation to financial instruments. The main types of risks are market risk, credit
risk and liquidity risk. The Company is not engaged in speculative treasury activities but seeks to manage risk and optimise
interest and commodity pricing through proven financial instruments.
The use of any derivative is approved by the management, which provide guidelines on the acceptable levels of interest
rate risk, credit risk, foreign exchange risk and liquidity risk and the range of hedging requirement against these risks.
Credit risk:
Credit risk is the risk that a counter party will not meet its obligations under a financial instrument or customer contract,
leading to financial loss. The Company is exposed to credit risk for receivables, cash and cash equivalents, short term
investments, financial guarantee and derivative financial instruments.
Cash and cash equivalents and short term investments
The Company considers factors such as track record, size of institution, market reputation and service standard to select
the banks with which deposits are maintained. Generally the balances are maintained with the institutions with which the
Company has also availed borrowings. The Company does not maintain significant deposit balances other than those
required for its day to day operations.
Trade receivables
The Company extends credits to customer in normal course of the business. The Company considers the factors such as
credit track record in the market of each customer and past dealings for extension of credit to the customer. The Company
monitors the payment track record of each customer and outstanding customer receivables are regularly monitored.
The Company evaluates the concentration of risk with respect to trade receivables as low, as its customers are located
at several jurisdiction and industries and operate in large independent markets. The Company also takes advances and
security deposits from customers which mitigate the credit risk to an extent.
The average credit period taken on sales of goods is 30 to 90 days. Generally, no interest has been charged on the
receivables. Allowances against doubtful debts are recognised against trade receivables based on estimated irrecoverable
amounts determined by reference to past default experience of the counterparty and an analysis of the counterparty's
current financial position.
Before accepting any new customer, the Company uses an internal credit system to assess the potential customer's credit
quality and defines credit limits by customer. Limits attributed to customers are reviewed periodically. There are two
customers who represent more than 10 per cent of total net revenue from operations during the year.
The Company does not hold any collateral or other credit enhancements over any of its trade receivables nor does it have
a legal right of offset against any amounts owed by the Company to the counterparty.
Expected credit loss:
The Company has used a practical expedient by computing the expected credit loss allowance for trade receivables based
on a provision matrix. The provision matrix takes into account historical credit loss experience and adjusted for forward¬
looking information. The expected credit loss allowance is based on the ageing of the days the receivables are due and the
rates as given in the provision matrix. The provision matrix at the end of the reporting period is as follows:
Financial guarantee
The Company has not given any financial guarantee.
Liquidity risk:
Liquidity risk reflects the risk that the Company will have insufficient resources to meet its financial liabilities as they fall
due.
The Company's objective is to maintain optimum levels of liquidity to meet its cash and collateral requirements. The
Company relies on a mix of borrowings, capital infusion and excess operating cash flows to meet its needs for funds.
The current committed lines of credit are sufficient to meet its short to medium term expansion needs. The Company
monitors rolling forecasts of its liquidity requirements to ensure that it has sufficient cash to meet operational needs
while maintaining sufficient headroom on its undrawn committed borrowing facilities so that it does not breach
borrowing limits.
The table below provides undiscounted cash flows towards non-derivative financial liabilities into relevant maturity based
on the remaining period at the balance sheet date to the contractual maturity date and, where applicable, their effective
interest rates.
Market risk:
The Company's activities expose it primarily to the financial risks of changes in foreign currency exchange rates and
interest rates. The Company enters into a variety of derivative financial instruments to manage its exposure to foreign
currency risk, including:
Forward foreign exchange contract to hedge the exchange rate risk arising on the export and imports of its products.
Currency risk:
The Company undertakes various transactions denominated in foreign currencies, consequently, exposure to exchange
rate fluctuations arise. Exchange rate exposures are managed within approved policy parameters utilising forward foreign
exchange contracts.
The Company transacts business primarily in Indian Rupee, USD, EUR, GBP and AED. The Company has obtained foreign
currency loans and has foreign currency payables and receivables and is therefore, exposed to foreign exchange risk.
Certain transactions of the Company act as a natural hedge as a portion of both assets and liabilities are denominated in
similar foreign currencies. For the remaining exposure to foreign exchange risk, the Company adopted a policy of selective
hedging based on risk perception of the management. Foreign exchange hedging contracts are carried at fair value.
The carrying amounts of the Company's foreign currency denominated monetary assets and monetary liabilities at the
end of the reporting period are as follows:
This is mainly attributable to the exposure outstanding on foreign currency receivables and payables in the Company at
the end of each reporting period.
Interest rate risk:
The Company's exposure to the risk of changes in market interest rates relates primarily to long term debts. Its objective
in managing its interest rate risk is to ensure that it always maintain sufficient head room to cover interest payment from
anticipated cash flows which is regularly reviewed by the board/nominated committee as well.
The following table demonstrates the sensitivity in the interest rate with all other variables held constant. The impact on
the Company's profit before tax and other comprehensive income due to changes in the interest rates is given below:
Commodity risk:
The Company is exposed to the movement in the price of key raw material and other traded goods in the domestic and
international markets. The Company has in place policies to manage exposure to fluctuation in the prices of key raw
materials used in operations. The Company enter into contracts for procurement of raw material and traded goods, most
of the transactions are short term fixed price contract and a few transactions are long term fixed price contracts.
Other financial instruments
The carrying amount of the financial assets and liabilities carried at amortised cost is considered a reasonable approximation
of fair value.
NOTE 47 SEGMENT REPORTING
Segment reporting, as required under Ind AS 108 "Operating Segment", has been provided in the consolidated financial
statements of the Company and therefore, no separate disclosure on segment reporting is given in the standalone
financial statements.
NOTE 48 EMPLOYEE BENEFITS
A. Defined contribution plan
The Company operates defined contribution retirement benefit plans for all eligible employees. The assets
of the plans are held separately from those of the Company's in funds under the control of trustees of
Somany Provident Fund Institution (PF Trust). During the FY 2023-24, the PF Trust had surrendered the
recognition granted to it. Accordingly, the entire corpus in respect of all the active and inactive employees
had been transferred to the office of Regional Provident Fund Commissioner (RPFC) Kukatpally, Hyderabad.
Where employees leave the plans prior to full vesting of the contributions, the contributions payable by the Company
are reduced by the amount of forfeited contributions.
The Company's contribution to Provident Fund and Superannuation Fund aggregating to H 739.32 lakh (net of amount
capitalised and reimbursement received from government) (previous year H 828.16 lakh) has been recognised in the
Statement of Profit and Loss under the head Employee Benefits Expense.
B. Defined benefit plans
Gratuity
The Company operates a gratuity plan covering qualifying employees. The benefit payable is the greater of the
amount calculated as per The Code on Social Security, 2020 or the Company Scheme applicable to the employee.
The benefit vests upon completion of five years of continuous service and once vested it is payable to employees on
retirement or on termination of employment. In case of death while in service, the gratuity is payable irrespective of
vesting. The Company makes annual contribution to the group gratuity Scheme administered by the Birla Sun Life
Insurance Company Limited.
The Company recorded the lease liability at the present value of the future lease payments discounted at the incremental
borrowing rate and the right of use asset.
Leases for which the Company is a lessor is classified as a finance or operating lease. Whenever the terms of the lease
transfer substantially all the risks and rewards of ownership to the lessee, the contract is classified as a finance lease. All
other leases are classified as operating leases. For operating leases, rental income is recognized on a straight line basis
over the term of the relevant lease.
In accordance with the provisions of section 135 of the Act, the Board of Directors of the Company had constituted a
Corporate Social Responsibility (CSR) Committee. In terms, with the provisions of the said Act, the Company was to spend
a sum of H 707.19 lakh (previous year H 561.61 lakh) towards CSR activities during the year ended 31 March 2026. The
CSR Committee has been examining and evaluating suitable proposals for deployment of funds towards CSR initiatives,
however, the committee expects finalization of such proposals in due course. During the year ended 31 March 2026, the
Company has contributed the following sums towards CSR initiatives.
NOTE 57 DISCLOSURE OF STRUCK OFF COMPANIES
The following table depicts the details of balances outstanding in respect of transactions undertaken with a company
struck-off under section 248 of the Companies Act, 2013:
The Board of Directors of the Company in their meeting held on 15 January 2022, had approved for sale/disposal of one of
the Company's faucet manufacturing plant, situated at Plot No. G-470-471, RIICO Industrial Area, Bhiwadi, in the State of
Rajasthan ("Bhiwadi Plant"), which had been shut down since the year 2014 and is presently not operational. Accordingly,
the same has been shown under "Non-current Assets held for sale" in accordance with IND AS 105 - "Non current assets
held for sale and discontinued operations".
The annual return of GST for FY 2025-26 is under process of filing with statutory authorities. The management believes
that there will not be any material impact over financial statements after financial submission/filing. The date of filing of
GST returns are 31 December 2026.
NOTE 64 DIVIDEND
The Board of Directors have recommended a dividend of 350% i.e. H 7/- (previous year H 7/-) on equity share of H 2/- each
for the year ended 31 March 2026 subject to approval of shareholders in the ensuing Annual General Meeting.
The Company has incorporated a wholly owned subsidiary under the name of "AGI Retail Private Limited" on 27 August
2024, The Company has subscribed for 1,00,000 equity shares of H 10 each of AGI Retail Private Limited.
The Board of directors in their meeting held on 29th July 2024 had approved the incorporation of a wholly owned subsidiary
under the name of "Sun Reach Pack (FZE)" in United Arab Emirates with the objective to promote exports and the same
has been incorporated on 28 October 2024. During the current year, the Company invested AED 6,00,000 (equivalent to
H 146.09 lakh) to acquire 4 equity shares of AED 1,50,000 each.
NOTE 66 GOVERNMENT GRANT
As per the investment promotion policy of the Telangana State Government for mega projects, the Company is eligible for
different subsidies linked to its investments made over the years. Other Income for the year ended 31 March 2026 includes
H 4,845.96 lakh (previous year H 2,103.76 lakh) subsidy as received by the Company.
NOTE 67 EXCEPTIONAL ITEMS
On 21 November 2025, the Government of India notified the four Labour Codes (labour codes) - The Code on Wages,
2019, The Industrial Relations Code, 2020, The Code on Social Security, 2020, and The Occupational Safety, Health and
Working Conditions Code, 2020, consolidating 29 existing labour laws. The Ministry of Labour & Employment published
draft Central Rules and FAQs to enable assessment of the financial impact due to above Stated changes. The Company has
assessed and disclosed the incremental impact of these changes on the basis of the best information available, consistent
with the guidance provided by the Institute of Chartered Accountants of India. Considering the materiality and regulatory-
driven, non-recurring nature of this impact, the Company has presented such incremental impact as "Exceptional item" in
the standalone financial statements for the year ended 31 March 2026. The incremental impact consisting of gratuity and
compensated absences is amounting to H509.33 lakh (net of amount capitalised during the year H1.25 lakh). The Company
continues to monitor the finalisation of Central/State Rules and clarifications from the Government on other aspects of
labour codes and will consider appropriate additional accounting impact, as needed, in the future.
The company has a widely used ERP as its accounting software for maintaining its books of accounts during the year ended
31 March 2026, which has a feature of recording audit trail (edit logs) facility and the same has been operated throughout
the year in the said application except (a) the audit trail has not been enabled at database level, (b) at application level, audit
trail is not enabled for relevant financial tables and (c) privileged access to audit trail settings is not restricted to authorized
users. Further, during the year, the audit trial feature has not been tempered with and the audit trail has been preserved by
the Company as per the statutory requirments for record retention.
The Company has enabled the audit trail (edit logs) functionality in its accounting software. However, the audit trail at
application level is not enabled for all relevant financial transactions and direct changes made at the underlying database
level, due to the direct impact of increase space utilization and the associated costs.
NOTE 69 OTHER DISCLOSURES
(a) The Company does not have any charges or satisfaction which is yet to be registered with Registrar of Companies
beyond the statutory period.
(b) The Company does not have any benami property held in its name. No proceedings have been initiated on or are
pending against the Company for holding benami property under the Benami Transactions (Prohibition) Act, 1988
(45 of 1988) and Rules made thereunder.
(c) The Company have not traded or invested in crypto currency or virtual currency during the financial year.
(d) There are no loans or advances in the nature of loans granted to Promoters, Directors, KMPs and their related parties
(as defined under Companies Act, 2013), either severally or jointly with any other person, that are: (a) repayable on
demand; or (b) without specifying any terms or period of repayment
(e) The Company has complied with the requirements of the number of layers prescribed under clause (87) of section 2
of the Companies Act, 2013 read with Companies (Restriction on number of Layers) Rules, 2017
(f) The Company has not been declared wilful defaulter by any bank or financial institution or other lender or government
or any government authority
(g) Utilisation of borrowed funds and share premium
(i) The Company has not advanced or loaned or invested funds to any other person(s) or entity(ies), including
foreign entities (Intermediaries) with the understanding that the Intermediary shall:
(a) 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
(b) Provide any guarantee, security or the like to or on behalf of the ultimate beneficiaries
(ii) The Company has not received any fund from any person(s) or entity(ies), including foreign entities
(Funding Party) with the understanding (whether recorded in writing or otherwise) that the Company shall:
(a) 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
(b) Provide any guarantee, security or the like to or on behalf of the ultimate beneficiaries
(h) There is no income surrendered or disclosed as income during the year in tax assessments under the Income Tax Act,
1961 (such as search or survey), that has not been recorded in the books of account
Previous period figures have been regrouped/re-arranged wherever considered necessary to confirm to the
current year's classification.
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