2.15 Provisions, Contingent Liabilities and Contingent Assets:
Provisions: Provisions are recognised when there is a present legal or constructive obligation as a result of a past event, it
is probable that an outflow of resources embodying economic benefits will be required to settle the obligation and there is a
reliable estimate of the amount of the obligation. Provisions are measured using the cash flows estimated to settle the present
obligation at the Balance sheet date.
Contingent Liabilities: Contingent liabilities are disclosed when there is a possible obligation arising from past events, the
existence of which will be confirmed only by the occurrence or non occurrence of one or more uncertain future events not wholly
within the control of the Company or a present obligation that arises from past events where it is either not probable that an
outflow of resources will be required to settle or a reliable estimate of the amount cannot be made.
Contingent Assets: Contingent assets are disclosed, where an inflow of economic benefits is probable.
2.16 Segment Reporting:
Operating segments are defined as components of an enterprise for which discrete financial information is available that is
evaluated regularly by the Chief Operating Decision Maker, in deciding how to allocate resources and assessing performance.
The reporting of segment information is the same as provided to the management for the purpose of the performance
assessment and resource allocation to the segments.
Segment revenue, segment expenses, segment assets and segment liabilities have been identified to segments on the basis
of their relationship to the operating activities of the segment. Inter segment revenue is accounted on the basis of transactions
which are primarily determined based on market/fair value factors. Revenue, expenses, assets and liabilities which relate to the
Company as a whole and are not allocable to segments on a reasonable basis have been included under “unallocated revenue/
expenses/assets/liabilities”.
2.17 Cash and cash equivalents:
Cash and Cash equivalents include cash, cheques on hand, cash at bank and short term deposits with banks having original
maturity of three months or less, which are subject to insignificant risk of changes in value.
2.18 Statement of Cash Flows:
Cash flows are reported using the indirect method whereby profit is adjusted for the effects of transactions of non-cash
nature and any deferrals or accruals of past or future cash receipts or payments. The cash flows from operating, investing and
financing activities of the Company are segregated based on the available information.
2.19 Dividend to equity shareholders:
Dividend to equity shareholders is recognised as a liability and deducted from shareholders’ equity, in the period in which the
dividends are approved by the equity shareholders in the general meeting.
2.20 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. The weighted average number of equity shares
outstanding during the period and all periods presented is adjusted for events such as bonus issue, bonus element in a
rights issue, share split, and reverse share split (consolidation of shares), etc that have changed the number of equity shares
outstanding, without a corresponding change in resources. For the purpose of calculating diluted earnings per share, the net
profit or loss for the period attributable to equity shareholders and weighted average number of shares outstanding during the
period is adjusted for the effects of all dilutive potential equity shares.
2.21 Government Grants:
Government grants including export incentives are not recognised until there is reasonable assurance that the Company will
comply with the conditions attaching to them and that the grants will be received. The Company accounts for its entitlement in
the Statement of Profit and Loss on accrual basis in the period in which the matching costs are incurred.
2.22 Recent Accounting Pronouncements:
The Ministry of Corporate Affairs (“MCA”) has notified amendments to the existing standards under Companies (Indian
Accounting Standards) Rules as issued from time to time. This notification has resulted into amendment in the following
existing accounting standard.
Ind AS 116 - Leases:
Application of the amendment in the above standard is not expected to have any significant impact on the Company’s financial
statements.
2B Critical accounting judgements and key sources of estimation uncertainty:
The preparation of financial statements in conformity with Ind AS requires that the management of the Company makes judgements,
estimates and assumptions that affect the reported amounts of income and expenses of the period, the reported balances of assets
and liabilities and the disclosures relating to contingent liabilities as of the date of the financial statements. The judgements, estimates
and underlying assumptions are reviewed on an ongoing basis. Revisions to significant accounting estimates include useful lives and
impairment of property, plant and equipment, allowance for doubtful debts/advances, deferred tax assets, future obligations in respect
of retirement benefit plans, expected cost of completion of contracts, allowances for inventories, etc. Difference, if any, between the
actual results and estimates is recognised in the period in which the results are known.
(i) Useful lives and Impairment of property, plant and equipment and intangible asset
The Company reviews the useful life of property, plant and equipment at the end of each reporting period. This re-assessment
may result in change in depreciation expense in future periods.
The Company assesses at each reporting date whether there is an indication that an asset may be impaired. If any such
indication exists, or when annual impairment testing for an asset is required, the Company makes an estimate of the asset’s
recoverable amount. An asset’s recoverable amount is the higher of its fair value less costs to sell and its value in use and is
determined for an individual asset, unless the asset does not generate cash inflows that are largely independent of those from
other assets or groups of assets and the asset’s value in use cannot be estimated to be close to its fair value. In such cases
the asset is tested for impairment as part of the cash-generating unit to which it belongs. When the carrying amount of an
asset or cash-generating unit exceeds its recoverable amount, the asset or cash-generating unit is considered impaired and
is written down to its recoverable amount. In assessing value in use, the estimated future cash flows are discounted to their
present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks
specific to the asset. Impairment losses relating to continuing operations are recognised in those expense categories consistent
with the function of the impaired asset.
(ii) Allowance for expected credit losses
When determining the lifetime expected credit losses for trade receivables, the Company considers reasonable and supportable
information that is relevant and available without undue cost or effort. This includes both quantitative and qualitative information
and analysis, based on the Company’s historical experience and credit assessment and including forward-looking information.
Refer Note No. 9(ii).
(iii) Employee Benefit Obligations
Employee benefit obligations 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 and mortality rates. Due to the complexities involved in the valuation and its long-term nature, employee
benefit obligation is highly sensitive to changes in these assumptions. All assumptions are reviewed at each reporting date.
(iv) Expected Cost of Completion of Contracts
The Company’s revenue recognition policy, set out in Note No. 2.03, explains how the Company values the work it has carried
out in each financial year.
Estimates are also required with respect to the below mentioned aspects of the contract.
1) Determination of stage of completion;
2) Estimation of project completion date; and
3) Estimated total revenues and estimated total costs to completion, including claims and variations.
(v) Allowance for Inventories
An inventory provision is recognised for cases where the realisable value is estimated to be lower than the inventory carrying
value. The inventory provision is estimated taking into account various factors, including prevailing sales prices of inventory
item and losses associated with obsolete / non-moving inventory items.
32. Disclosure pursuant to Indian Accounting Standard (Ind AS) - 19: Employee Benefits
1) Defined contribution plans:
The Company participates in defined contribution plans on behalf of relevant personnel. Any expense recognised in relation to
these schemes represents the value of contributions payable during the period by the Company at rates specified by the rules of
those plans. The only amounts included in the balance sheet are those relating to the prior months contributions that were not
due to be paid until after the end of the reporting period.
The defined contribution plans are as below:
a) Provident fund
In accordance with the Employee’s Provident Fund and Miscellaneous Provisions Act, 1952 eligible employees of the
Company are entitled to receive benefits in respect of provident fund, a defined contribution plan, in which both employees
and the Company make monthly contributions at a specified percentage of the covered employees’ salary. The contributions,
as specified under the law, are made to the provident fund administered and managed by Government of India (GOI).
The Company has no further obligations under the fund managed by the GOI beyond its monthly contributions which are
charged to the Statement of Profit and Loss in the period they are incurred. The benefits are paid to employees on their
retirement or resignation from the Company.
b) Superannuation fund
The Company holds a policy with an Insurance company, to which it contributes a fixed amount relating to superannuation
and the pension annuity is met by the Insurer as required, taking into consideration the contributions made. The Company
has no further obligations under the Scheme beyond its monthly contributions which are charged to the Statement of Profit
and Loss in the period they are incurred.
2) Defined Benefit Plans:
The Defined Benefit Plan is as below:
Gratuity (Funded)
The Company has an obligation towards gratuity, a funded defined benefit retirement plan covering eligible employees. The
plan provides for lump sum payment to vested employees at retirement, on death while in employment or on termination of the
employment in terms of the provisions of the Payment of Gratuity Act, 1972 or as per the Company’s Scheme, as applicable.
Vesting occurs upon completion of five years of service. The Company makes annual contributions to gratuity fund established
with the Insurance Company. The Company accounts for the liability for gratuity benefits payable based on an actuarial valuation.
The plan typically exposes the Company to actuarial risks such as: investment risk, interest rate risk, longevity risk and salary risk.
Investment risk
The Probability or likelihood of occurrence of losses relative to the expected return on any particular investment.
Interest risk
If the Discount Rate i.e the yield on the Government Bonds decrease in future, the Actuarial Liability will increase and vice versa.
The quantum of increase in valuation liability corresponding to specific decrease in the Discount Rate and vice versa, has been
shown in the annexure containing the sensitivity Analysis of Key Actuarial Assumption.
32. Disclosure pursuant to Indian Accounting Standard (Ind AS) - 19: Employee Benefits (Contd.)
Longevity risk
If the Mortality rate experienced by the staff of a particular Company is higher than what is assumed in mortality Table used in the
valuation, the valuation liability will increase.
However, it will be very cumbersome to measure the quantum of change in valuation liability for assumed change in Mortality rates
as can be done in case of changes in salary Growth Rate and Interest Rate.
Salary risk
If the salary Growth Rate over the future years of services is increased, the Actuarial Liability will increase and vice versa.
The quantum of increase in the valuation liability corresponding to specific increase in the salary growth rate and vice versa has
been shown in the annexure containing Sensitivity Analysis of key Actuarial Assumption.
The most recent actuarial valuation of the present value of the defined benefit obligation was carried out at 31st March, 2025 by
an independent actuary. The present value of the defined benefit obligation, the related current service cost and past service cost
were measured using the projected unit credit method.
All Non-current assets are located in India.
No customer in Power Systems segment contributed to more than 10% to the Company’s revenue for the year ended 31st March, 2025
(Previous year - No customer). There is no trend in such composition revenue by customer and considering the nature of the Company’s
business, the customer composition may change year on year.
OTHER DISCLOSURES:
(i) Segments have been identified in line with Ind AS 108 on the basis of production and distribution process and regulatory
environment.
(ii) The Chief Operating Decision Maker (“CODM”) evaluates the Company’s performance and allocates resources based on an
analysis of various performance indicators by operating segments. The CODM reviews revenue and profit from operations as
the performance indicator for all of the operating segments.
(iii) While presenting the segment results, common expenses, common assets and liabilities to the extent not directly identifiable
with any one segment have been grouped as unallocable.
(iv) Finance income and costs, and fair value gains and losses on financial assets are not allocated to individual segments as the
underlying instruments are managed on a group basis.
(v) Current taxes, deferred taxes and certain financial assets and liabilities are not allocated to those segments as they are also
managed for the Company as a whole.
(vi) Capital expenditure consists of additions of property, plant and equipment and intangible assets.
SEGMENT INFORMATION:
(i) Composition of Business Segments:
a. Power Systems
This segment comprises of the design, commissioning and marketing of power transformers, EPC projects for electrical
substations including delivery, rectification, commissioning and servicing of transformers and marketing of maintenance
products.
b. Industrial Systems
This segment comprises of the development, marketing and manufacture of a wide range of standard and customized
electric motors; magnet technology machines and the engineering and supply of Drives and Automation systems.
(ii) Segment Revenue, Result, Assets and Liabilities include respective amounts directly attributable to each segment and other
relevant amounts allocated on reasonable basis.
B. Interest rate risk management
The Company does not have interest rate risk exposure on its outstanding loans as at the year end as these loans are short¬
term loans on fixed interest rate basis.
C. Other price risks
The Company is exposed to price risks arising from its investments in mutual funds and equity.
Equity price risk is related to change in market reference price of investments in equity shares held by the Company. The fair
value of quoted investments held by the Company exposes it to equity price risks. In general, these investments are not held
for trading purposes.
The Company manages the surplus funds also through investments in debt based mutual fund schemes. The price of
investment in these mutual fund Net Asset Value (NAV) is declared by the Asset Management Company on daily basis. The
Company is exposed to price risk on such investment schemes by the movement in the NAV of invested schemes.
Mutual fund investments are susceptible to market price risk, mainly arising from changes in the interest rates or market yields
which may impact the return and value of such investments.
C.1 Equity price sensitivity analysis
The sensitivity analysis below has been determined based on the exposure to equity price risks at the end of the
reporting period.
I f equity prices had been 5% higher/lower, the other comprehensive income for the year ended 31st March, 2025
would have increased/decreased by ' /- 65.24 crores (2023-2024: increase/decrease by ' /- 64.54 crores) as a
result of the changes in fair value of equity investments measured at FVTOCI.
C.2 Mutual fund price sensitivity analysis
The sensitivity analysis below has been determined based on Mutual Fund Investment at the end of the reporting
period. If NAV had been 1% higher / lower, the profit for year ended 31st March, 2025 would have increased/
decreased by ' /- 0.36 crores (2023-2024: increase/decrease by ' /- 0.34 crores) as a result of the changes in fair
value of mutual funds.
40.3.2 Credit risk management
Credit risk arises from the possibility that a counter party’s inability to settle its obligations as agreed in full and in
time. The maximum exposure to credit risk in respect of the financial assets at the reporting date is the carrying value
of such assets recorded in the financial statements net of any allowance for losses.
A. Trade Receivables
The Company’s trade receivables consists of a large and diverse base of customers including State owned
Companies, Large Private Corporates and Public sector enterprises. Hence, the Company is not exposed to
concentration and credit risk.
The ageing analysis of trade receivables as of the reporting date is as follows:
40.3.3 Liquidity risk management
The objective of liquidity risk management is to maintain sufficient liquidity to meet financial obligations of the Company
as they become due. The Treasury Risk Management Policy includes an appropriate liquidity risk management framework
for the management of the short-term, medium-term and long term funding and cash management requirements. The
Company manages the liquidity risk by maintaining adequate cash reserves, banking facilities and reserve borrowing
facilities by continuously monitoring forecast and actual cash flows and by matching the maturity profiles of financial
assets and liabilities.
The Company has access to various fund / non-fund based bank financing facilities. The amount of unused
borrowing facilities (fund and non-fund based) available for future operating activities and to settle commitments as at
31st March, 2025 is ' 646.56 crores (as at 31st March, 2024: ' 551.46 crores).
40.3.3.1 Liquidity risk table
The following table details the Company’s remaining contractual maturity for its non-derivative financial liabilities
with agreed repayment periods. The table has been drawn up based on the undiscounted cash flows of financial
liabilities based on the earliest date on which the Company can be required to pay. The table includes principal
cash flows along with interest.
42. Other Statutory Information
(i) The Company does not have any Benami property, where any proceeding has been initiated or pending against the Company for holding
any Benami property.
(ii) The Company has not traded or invested in Crypto currency or Virtual Currency during the financial year.
(iii) 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.
(iv) 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 on behalf of the Ultimate Beneficiaries.
d) Nature of CSR activities - The Company’s CSR initiatives primarily focus on education, vocational training, and skill development
for adolescents and youth from under-served communities in Mumbai and Navi Mumbai, aiming to enhance their livelihood
opportunities.
For and on behalf of the Board of Directors
As per our report of even date.
For Deloitte Haskins & Sells LLP Nikhil J. Danani
Chartered Accountants, DIN 00056514
Firm Registration No. 117366W/W-100018 Vice Chairmen &
Managing Directors
Pallavi Sharma Durgesh N. Nagarkar Nakul P. Mehta
Partner Company Secretary & Senior General Manager : Legal DIN 00056561
Membership No. 113861
Yogendra S. Agarwal Shome N. Danani } Director
Mumbai, 16th May, 2025 Mumbai, 16th May, 2025
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