(xviii) Provisions
Provision is recognised when an enterprise
has a present obligation (legal or
constructive) as a result of a past event and
it is probable that an outflow of resources
will be required to settle the obligation, in
respect of which a reliable estimate can be
made. Provisions are determined based on
management estimates required to settle
the obligation at the balance sheet date,
supplemented by experience of similar
transactions. These are reviewed at the
balance sheet date and adjusted to reflect
the current management estimates.
(xix) Contingent liabilities and assets
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, is termed
as a contingent liability. The existence of a
contingent liability is disclosed in the notes
to the financial statements.
Contingent assets: Contingent asset is
not recognised in standalone financial
statements since this may result in the
recognition of income that may never be
realised. However, when the realisation of
income is virtually certain, then the related
asset is not a contingent asset and is
recognised.
Provisions, contingent liabilities and
contingent assets are reviewed at each
balance sheet date.
(xx) Earnings per share
Basic earnings per share is 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 year.
Diluted earnings per share is computed
using the weighted average number of
equity shares and dilutive potential equity
shares outstanding during the year. 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 year are adjusted
for the effects of all dilutive potential equity
shares.
(xxi) Discontinued operations
A discontinued operation is a component
of the Company's business, the operations
and cash flows of which can be clearly
distinguished from the rest of the operations
of the Company and which :
- represents a major line of business or
geographic area of operations:
- is part of a single coordinated plan
to dispose off a separate major line
of business or geographic area of
operations.
Classification as discontinued operation
occurs at the earliest of disposal or when the
operation meets the criteria to be classified
as held-for-sale.
The comparative statement of profit and
loss has been seggregating the operation
as continued and discontinued for the entire
comparative period.
(xxii) Equity share capital
Incremental costs directly attributable to
the use of equity shares are recognised as a
deduction from equity. Income tax relating
to transaction costs of an equity transaction
is accounted for in accordance with Ind AS
12.
(xxiii) Recent accounting pronouncements
Recent pronouncements Ministry of
Corporate Affairs (“MCA”) notifies new
standards or amendments to the existing
standards under Companies (Indian
Accounting Standards) Rules as issued from
time to time. In May 2025, MCA notified
amendments to Ind AS 21 - The Effects
of Changes in Foreign Exchange Rates,
applicable w.e.f. April 1, 2025. The Company
has reviewed the amendment and based
on its evaluation has determined that it
does not have any significant impact in its
financial statements. In August 2025, MCA
notified the following amendments to:
1. Ind AS 1, Presentation of Financial
Statements, applicable w.e.f April 1, 2025
- The amendment relates to classification
of liabilities as current or non -current
and non-current liabilities with covenants.
In the context of classifying a liability as
current, it removes the requirement of
existence of a right to defer settlement for
at least 12 months after the reporting date,
and instead requires that the said right
should exist on the reporting date and have
substance. The amendment also introduces
guidance on classification of liabilities with
covenants. The Company has no impact
of these amendments in its classification
criteria of current and non-current liabilities.
2. Ind AS 7, Statement of Cash Flows and Ind
AS 107, Financial Instruments - Disclosures,
applicable w.e.f April 1, 2025 - The
amendment in Ind AS 7 requires to inform
users of financial statements of the existence
of supplier finance arrangements and explain
the nature of the arrangements, the carrying
amount of liabilities and the range of payment
due dates. Ind AS 107 has been amended
to add supplier finance arrangements as
a factor that may cause concentration of
liquidity risk. The Company has reviewed
the amendment and based on its evaluation
has determined that it does not have any
significant impact in its financial statements.
3. Ind AS 12, International Tax Reform - Pillar
Two Model Rules applicable immediately
- The amendments provide a temporary
mandatory relief from deferred tax
accounting for top-up tax and disclose that
they have applied the relief. This relief is
immediate and applies retrospectively.
Note:
During the previous year, the company has entered into a loan agreement to provide unsecured loans to its
fully owned subsidiary, M/s.Geojit Investments Ltd for an amount up to '80,000.00 lakhs. These loans shall be
used by M/s.Geojit Investments Ltd for purchase of MTF book, MTF lending purposes, settlement of purchase
consideration payable towards business transfer of securities business or for working capital purposes. These
loans carry an interest rate of 10%.
During the year, the Company has provided loan amounting to '50,871.50 lakhs which is repayable on demand
(out of which loan amounting to '16,800.00 lakhs is repayable on demand after one year. This loan is fully
outstanding as on 31 March 2026.)
C Investment property comprises of the following:
The Company's corporate building located at 34/659-P, Civil Line Road, Padivattom, Kochi - 682024, is
partly used for own purpose and partly let out to subsidiary companies for earning rental income.
D Measurement of fair value
(i) Fair valuation hierarchy
The fair value of investment property has been determined by a registered valuer as defined under
rule 2 of Companies (Registered Valuers and Valuation) Rules, 2017.
The fair value measurement of the investment property has been categorised as Level 3 fair value
based on inputs to the fair value technique used.
(ii) Valuation techniques used and key inputs to valuation on investment property
For the purpose of valuation, the primary valuation methodology used is the replacement cost
model adjusted for depreciation.
The Company has also availed credit facilities secured by trade receivables, land and buildings, which has not
been utilised as at the year end.
Borrowings from banks / financial institutions carries interest rates from 6.92% to 8.82% per annum
(31 March 2025: 7.24% to 8.82% per annum) and is repayable on demand.
The Company has utilised the loans for the purpose for which it was availed.
During the current year, the Company is not required to comply with the requirement of filing of quarterly
returns or statements with the bank or financial institutions. The Company has complied with the requirement
of filing of quarterly returns or statements of trade receivables with the bank or financial institutions, wherever
applicable, and these returns were in agreement with the books of accounts for the quarters during the year
ended 31 March 2025.
During the previous year, as part of business transfer agreement, the Company has transferred its borrowings
related to transferred business to its wholly owned subsidiary, Geojit Investments Limited amounting to
'14,500.00 lakhs. Prior to such transfer, the Company has repaid balance borrowings amounting to '11,600.00
lakhs. The company has repaid '15,164.00 lakhs of borrowings out of rights issue proceeds during the previous
year. Also refer movement below.
(d) Rights, preferences and restrictions in respect of equity shares issued by the Company
The Company has only one class of equity shares having a par value of '1/- each. The equity shares of the
company having par value of '1/- rank pari-passu in all respects including voting rights and entitlement
to dividend. The dividend proposed if any, 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 holders of the equity shares will be entitled to receive the
remaining assets of the Company, after settling the dues of preferential and other creditors as per priority.
The distribution will be in proportion to the number of equity shares held by the shareholders.
(e) As at 31 March 2026, 9,531,500 equity shares (31 March 2025: 1,304,167 equity shares) of '1/- each are
reserved towards outstanding employee stock options granted. (Refer note 37)
(f) There are no shares allotted as fully paid-up by way of bonus shares or allotted as fully paid-up pursuant
to contract without payment being received in cash, or bought back during the period of five years
immediately preceding the reporting date.
(g) Rights issue
(a) On 13 July 2024, the Board of Directors of the Company approved issue of equity shares of the
Company by way of a Rights issue to the eligible shareholders of the Company as on the record date
for an amount not exceeding '20,000.00 lakhs. On 19 September 2024, the Rights Issue Committee
of the Company approved the Rights issue price of '50 per equity share including a premium of '49
per equity share over face value of '1 per equity share and Rights entitlement ratio of one equity share
for every six equity shares held by eligible equity shareholders of the Company as on the record date.
i.e., ratio of 1:6. On 30 September 2024, the Rights Issue Committee of the Company approved the
Record date as 7 October 2024 and the issue open date as 15 October 2024 and issue closing date
as 23 October 2024. Subsequent to this, 39,857,413 shares have been allotted on 30 October 2024.
Pursuant to the allotment, the paid up equity share capital of the company has increased to '2,790.25
lakhs. The object of the Rights issue is to enlarge the capital base of the Company. The net proceeds
to be utilised for Repayment or prepayment, in full or in part, of certain borrowings availed by the
Company and for other General corporate purposes. The Company has raised '19,928.70 lakhs on
application. The total expense on Rights Issue aggregating to '434.49 lakhs has been adjusted against
securities premium. During the year ended 31 March 2025, the Company has utilised '15,000.00 lakhs
for repayment of borrowings and balance amount was utilised for general corporate purpose.
(b) There has been no deviation in the use of proceeds of the Rights Issue, from the objects stated in the
Offer document.
(h) Capital management:
The Company's objective for capital management is to maximise shareholder value, safeguard business
continuity and support the growth of the Company. The Company determines the capital requirement based
on annual operating plans and long-term and other strategic investment plans. The funding requirements
are met through equity, operating cash flows generated and short term debt. The Company is not subject
to any externally imposed capital requirements.
For the purpose of Company's capital management, capital includes subscribed equity share capital,
securities premium, all other equity reserves attributable to the owners of the Company and debt from the
financial institutions.
Description of the nature and purpose of other equity :
i) Share application money pending allotment
The share application money was received pursuant to the exercise of options granted to employees
under the employee stock option plans. The Company has sufficient authorised share capital to cover the
allotment of these shares. Pending allotment of shares, the amounts are maintained in a designated bank
account and are not available for use by the Company.
ii) Securities premium
Securities premium reserve is used to record the premium on issue of shares. The reserve can be utilised
only for limited purposes such as issuance of bonus shares in accordance with the provisions of the
Companies Act, 2013.
iii) Share options outstanding account
The employee stock options outstanding represents amount of reserve created by recognition of
compensation cost at grant date fair value on stock options vested but not exercised by employees and
unvested stock options in the Statement of profit and loss in respect of equity-settled share options
granted to the eligible employees of the Company and its subsidiaries in pursuance of the Employee Stock
Option Plan.
iv) General reserve
General reserve is created through annual transfer of profits at a specified percentage in accordance
with applicable regulations under the erstwhile Companies Act, 1956. The purpose of these transfers was
to ensure that if a dividend distribution in a given year is more than 10% of the paid up capital of the
Company for that year, then the total dividend distribution is less than the total distributable profits for
that year. Consequent to introduction of the Companies Act, 2013, the requirement to mandatorily transfer
specified percentage of net profits to General reserve has been withdrawn. However, the amount previously
transferred to the General reserve can be utilised only in accordance with the specific requirements of the
Companies Act, 2013.
v) Retained earnings
Retained earnings or accumulated surplus represents total of all profits retained since the Company's
inception. Retained earnings are credited with current year profits, reduced by losses, if any, dividend pay¬
outs, transfers to General reserve or any such other appropriations to specific reserves.
vi) Other reserves
Other reserves comprises capital reserve.
vii) Other comprehensive income
Other comprehensive income (OCI) comprises of actuarial gains and losses that are recognised in other
comprehensive income.
Details of dividends proposed/ paid
The Board of Directors at its meeting held on 29 April 2026 has recommended a final dividend of '1.50/-
per equity share of face value '1/- each for the financial year ended 31 March 2026 (31 March 2025: '1.50/-
per equity share). The payment is subject to the approval of the shareholders in the ensuing Annual General
Meeting of the Company.
The Company has also paid final dividend declared for the year ended 31 March 2025 amounting to '4,185.38
lakhs (31 March 2024: '3,587.16 lakhs) in the current year.
33 EXCEPTIONAL ITEMS
On November 21, 2025, the Government of India notified the four 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 changes in
regulations. The Company has planned to restructure the compensation of its employees in the first quarter of
the financial year 2026-27, and assessed the impact of the changes, consistent with the Labour Codes, draft
rules, FAQs and legal opinion. Considering the materiality and regulatory-driven, non-recurring nature of this
impact, The Company has presented such incremental impact as “Statutory impact of new Labour Codes” under
“Exceptional items” in the consolidated statement of profit and loss for the year ended 31 March 2026. The
Company continues to monitor the finalisation of Central / State Rules and clarifications from the Government
on other aspects of the Labour Code and would provide appropriate accounting effect on the basis of such
developments as needed.
Note:i) Direct tax matters
The Company has ongoing disputes with Income Tax authorities in India. The disputes relate to tax
treatment of certain expenses claimed as deductions, computation or eligibility of tax incentives or
allowances, and characterisation of fees for services received. As at 31 March 2026, the Company
has contingent liability of '524.95 lakhs (31 March 2025: '102.05 lakhs) in respect of tax demands for
assessment years between 2003-04 to 2018-19 which are being contested by the Company based on
the management evaluation and advice of tax consultants.
The Company periodically receives notices and inquiries from income tax authorities related to the
Company's operations in the jurisdictions it operates in. Management has evaluated these notices and
inquiries and has concluded that the position taken by it on the above matters is tenable and hence no
adjustments have been made in the financial statements.
ii) Indirect tax matters
The Company has ongoing disputes with Indirect tax authorities mainly relating to treatment of
characterisation and classification of certain items. As at 31 March 2026, the Company has demands and
show cause notices amounting to '654.86 lakhs (31 March 2025: '709.95 lakhs) from various indirect
tax authorities which are being contested by the Company based on the management evaluation and
advice of tax consultants.
iii) Guarantees given by the company
The guarantees given by the Company include
i) Corporate guarantees given to various banks in respect of the credit facilities granted to the
subsidiaries Geojit Investments Limited ['34,500.00 lakhs as on 31 March 2026 (31 March 2025:
'64,500.00 lakhs)] and Geojit Credits Private Limited ['2,000.00 lakhs (31 March 2025: 'Nil)]. The
borrowings against such credit facilities is '1,898.99 lakhs (31 March 2025: '8,009.91 lakhs)
ii) Counter guarantees given against personal guarantee given by the employees in litigation
proceedings - '15.68 lakhs (31 March 2025: '15.68 lakhs)
37 EMPLOYEE STOCK OPTION PLANS (CONTD..)(B) Accounting of employee share based compensation cost:
The Company has adopted 'fair value method' for accounting employee share based compensation cost.
Under the fair value method, fair value of options are expensed on straight-line basis over the vesting
period as employee share based compensation cost. The expected forfeiture rate per annum is 10% for all
ESOP schemes (31 March 2024: 10%).
Annualised volatility is computed using the high and low market price of the Company's share over the one
year period prior to the date of grant. It is assumed that employees would exercise the options immediately
on vesting. The historical volatility of the Company's share price is higher than the volatility considered
above. However, the Company expects the volatility of its share price to reduce as it matures.
ESOP granted to Key managerial personnel during the year - 750,000 options under ESOP 2025 (31 March
2025: Nil)
38 EMPLOYEE BENEFITS
General description of defined benefit plans
(i) Defined contribution plan - Provident Fund
The Company makes Provident Fund contribution for qualifying employees. Under the plan, the
Company is required to contribute a specified percentage of the payroll costs to fund the benefits.
The Company has recognised '862.37 lakhs (31 March 2025: '718.88 lakhs) towards provident fund
contribution in the statement of profit and loss. The contribution payable to the plan by the Company
are at the rates specified in the rules of the scheme.
(ii) Defined benefit plan - Gratuity
The Company provides gratuity benefit to its employees (included as part of 'Contribution to
provident and other funds' in Note 30 Employee benefits expense), which is funded with Life Insurance
Corporation of India.
39 LEASES
As a lessee
The Company's lease asset classes primarily consist of leases for office premises. The Company assesses
whether a contract contains a lease, at inception of a contract. 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 recognises 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). For these short-term leases, the Company recognises lease payments
as an operating expense.
The right-of-use assets are initially recognised at cost, which comprises the initial amount of the lease liability.
They are subsequently measured at cost less accumulated depreciation. Right-of-use assets are depreciated
from the commencement date on a straight-line basis over the lease term.
The lease liability is initially measured at amortised cost at the present value of the future lease payments. The
lease payments are discounted using the incremental borrowing rate of the company.
40 OPERATING SEGMENTS
The Company's Chief Operating Decision Maker (CODM) examines the performance both from a service
perspective and geography perspective and has identified the reportable segments and the Company's
Managing Director is the CODM. There is no separate reportable segment as per Ind AS 108 on 'Operating
Segments' in respect of the Company. The Company's operations predominantly relate to one segment,
viz., wealth management services. The entire operations are organised and managed as one organisational
unit with same set of risks and returns. Hence, the same is considered as a single primary segment. Besides,
the Company's operations are located only in India and hence, separate secondary geographical segment
information is not disclosed.
The Company is not reliant on revenues from transactions with any single external customer and does not
receive 10% or more of the Company's total revenue from transactions with any single external customer for
the year ended 31 March 2026 and 31 March 2025.
Further, the Company has provided the required disclosures relating to the segment in its consolidated financial
statements.
B. Measurement of fair value
Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly
transaction in the principal (or most advantageous) market at the measurement date under current market
conditions (i.e. an exit price), regardless of whether that price is directly observable or estimated using a
valuation technique.
The investments included in Level 1 of fair value hierarchy have been valued using quoted prices for
instruments in an active market. The investments included in Level 2 of fair value hierarchy have been
valued using valuation techniques based on observable market data. The investment included in Level 3 of
fair value hierarchy have been valued using the income approach and break-up value to arrive at their fair
value. There is no movement from between Level 1, Level 2 and Level 3. There is no change in inputs used
for measuring Level 3 fair value.
Valuation technique used to determine fair value
Specific value techniques used to value financial instruments include:
- the use of quoted market prices for listed instruments
- the fair value of forward foreign exchange contracts is determined using forward exchange rates at the
balance sheet date.
- the fair value of remaining financial instruments is determined using market comparables, discounted
cash flow analysis.
The following table summarises financial instruments measured at fair value on recurring basis:
c. Financial risk management
The Company has exposure to the following risk arising from financial instruments:
a) Credit risk
b) Liquidity risk
c) Market risk
Risk management framework
The Company has established a comprehensive system for risk management and internal controls for all
its businesses to manage the risks that it is exposed to. The objective of its risk management framework
is to ensure that various risks are identified, measured and mitigated and also that policies, procedures
and standards are established to address these risks and ensure a systematic response in the case of
crystallisation of such risks.
The Company has established various policies with respect to such risks which set forth limits, mitigation
strategies and internal controls to be implemented by the three lines of defence approach provided below.
The Board oversees the Company's risk management and has constituted a Risk Management Committee,
which frames and reviews risk management processes and controls.
The risk management system features a “three lines of defence” approach:
1. The first line of defence comprises its operational departments, which assume primary responsibility
for their own risks and operate within the limits stipulated in various policies approved by the Board
or by committees constituted by the Board.
2. The second line of defence comprises specialised departments such as risk management, Internal
Permanent Control and compliance. They employ specialised methods to identify and assess risks
faced by the operational departments and provide them with specialised risk management tools and
methods, facilitate and monitor the implementation of effective risk management practices, develop
monitoring tools for risk management, internal control and compliance, report risk related information
and promote the adoption of appropriate risk prevention measures.
3. The third line of defence comprises the internal audit department and external audit functions. They
monitor and conduct periodic evaluations of the risk management, internal control and compliance
activities to ensure the adequacy of risk controls and appropriate risk governance, and provide the Board
with comprehensive feedback.
4. General Risk Assessment : The Company, to the extent possible, has considered the risks that may result
from the uncertainty relating to ongoing geopolitical uncertainties and its impact on the overall financial
performance of the Company. Based on the Company's analysis of the current indicators of the future
economic condition on its business and the estimates used in its financial statements, the Company does
not foresee any material impact in the recoverability of the carrying value of the assets and its financial
performance. The risk assessment is a continuous process and the Company will continue to monitor the
impact of the changes in future economic conditions on its business.
a) Credit risk:
It is risk of financial loss that the Company will incur a loss because its customer and counterparty to
financial instruments fails to meet its contractual obligation.
The Company's financial assets comprise of Cash and bank balance, Trade receivables, Loans,
Investments and Other financial assets which comprise mainly of deposits.
The maximum exposure to credit risk at the reporting date is primarily from the Company's trade
receivable and loans.
Trade receivables, loans and other financial assets:
The Company has followed simplified approach for measurement of expected credit loss in case of
receivables and loans. At each reporting date, the Company assesses whether financial assets carried
at amortised cost are credit impaired. A financial asset is 'credit impaired' when one or more events
that have a detrimental impact on the estimated future cash flows of the financial asset have occurred.
Loss allowances for trade receivables are always measured at an amount equal to lifetime expected
credit losses. Lifetime expected credit losses are the expected credit losses that result from all possible
default events over the expected life of a financial instrument. The maximum period considered when
estimating expected credit losses is the maximum contractual period over which the Company is
exposed to credit risk. Based on the industry practices and business environment in which the entity
operates, management considers that the trade receivables and loans are in default based on the due
dates of the respective financial assets.
Movement in the allowances for impairment in respect of trade receivables, loans and other financial
assets are as follows:
The Company applies the Ind AS 109 simplified approach to measure expected credit losses which
uses a lifetime expected loss allowance (ECL) for all trade receivables. The application of simplified
approach does not require the Group to track changes in credit risk. Rather, it recognises impairment
loss allowance based on lifetime ECLs at each reporting date, right from its initial recognition.
To measure the expected credit losses, trade receivables have been grouped based on shared credit
risk characteristics as follows:
- Portfolio management services and distribution related receivables
Portfolio management services and distribution related receivables
The Company has computed expected credit loss where there is significant delay in collection by
grouping under various aging categories and based on historical data of probability of default is
applied to arrive at ECL.
Other financial assets considered to have a low credit risk:
Credit risk on cash and cash equivalents is limited as we generally invest in deposits with banks with
high credit ratings assigned by international and domestic credit rating agencies. Other financial assets
include deposits for assets acquired on lease and with qualified clearing counterparties and exchanges
as per the prescribed statutory limits.
Investments comprise of equity investments in subsidiaries, joint venture and associate, debt mutual
funds which are market tradeable. Further, for the loan given to wholly owned subsidiary amounting
to '52,754.50 lakhs(31 March 2025 : 37,610.00 lakhs) credit risk is considered to be low.
b) Liquidity risk
Liquidity represents the ability of the Company to generate sufficient cash flow to meet its financial
obligations on time, both in normal and in stressed conditions, without having to liquidate assets or
raise funds at unfavourable terms thus compromising its earnings and capital.
Liquidity risk is the risk that the Company may not be able to generate sufficient cash flow at reasonable
cost to meet expected and/or unexpected claims. It arises in the funding of lending, trading and
investment activities and in the management of trading positions.
The Company aims to maintain the level of its cash and cash equivalents and other highly marketable
investments at an amount in excess of expected cash outflow on financial liabilities.
Funds required for short period is taken care by borrowings utilising overdraft facility from bank.
The table below summarises the maturity profile of the undiscounted cash flows of the Company's
financial assets and liabilities as at 31 March 2026
c) Market risk
Market risk arises when movements in market factors (foreign exchange rates, interest rates credit spreads and
equity prices) impact the Company's income or the market value of its portfolios. The Company, in its course of
business is exposed to market risk due to change in equity prices, interest rates and foreign exchange rates. The
objective of market risk management is to maintain an acceptable level of market risk exposure while aiming to
maximise returns. The Company classifies exposures to market risk into either trading or non-trading portfolios.
Both the portfolios are managed using the following sensitivity analysis:
i) Equity price risk
ii) Interest rate risk
iii) Currency risk
i) Equity price risk
The Company does not have proprietory trading positions in equity. In respect of the client positions, the risk
is managed through risk based margin requirements and hence the Company do not envisage a substantial
equity price risk.
ii) Interest rate risk
The Company's exposure to interest rate risks arises primarily due to the short term investments in debt
mutual funds.
An increase of 5 percent in net assets value (NAV) would increase profit and loss by approximately '398.18
lakhs (31 March 2025 : 'Nil). A similar percentage decrease would have resulted in equivalent opposite impact.
The non-traded financial assets and liabilities are fixed rate instruments and are valued at amortised cost.
Any shifts in yield curve will not impact their carrying amount and will therefore not have any impact on the
Company's statement of profit and loss.
44 TRANSFER OF BROKING AND DEPOSITORY BUSINESS AND DISCONTINUED OPERATIONS
The Board of Directors of the Company, in its meeting held on 28 July 2023, approved the proposed transfer
of the Company's securities broking business and its related activities ('the business') as a 'going concern'
on 'slump sale' basis to Geojit Investments Limited ('GIL'), a wholly owned subsidiary of the Company, to
comply fully with the applicable regulations. The transfer was subsequently approved by the shareholders of
the Company in the extraordinary general meeting held on 4 October 2023.
The Board of Directors of the Company, in its meeting held on 28 July 2023, approved the proposed transfer of
the Company's securities broking business and its related activities ('the business') as a 'going concern' on 'slump
sale' basis to Geojit Investments Limited ('GIL'), a wholly owned subsidiary of the Company, to comply fully with
the applicable regulations. The transfer was subsequently approved by the shareholders of the Company in the
extraordinary general meeting held on 4 October 2023. On receipt of approvals, pursuant to a Business Transfer
Agreement dated 13 December 2024 , the Company has transferred net assets amounting to '48,561.18 lakhs to
GIL for a total consideration of '48,561.18 lakhs on 21 March 2025, settled by cash. Accordingly, the comparative
standalone statement of profit and loss has been disclosed with discontinued operation seperately fom the
continuing operations.
45 DETAILS OF RECOVERY FOR SHARED SERVICES AND MANAGEMENT SUPPORT FEE
The Company has transferred its broking and depository business to its wholly owned subsidiary, Geojit
Investments Limited. Refer note 44 for further details. The Company has cross charged expenses allocable to
business of the Company, summary of which is provided below. The Company has carried out these allocation
considering i) expenses directly related to the business of the Company and ii) allocated common cost which
are not directly identifiable on the basis of certain criteria like revenue, number of employees. Further, the
Company has charged mark up on such cost allocation as management and support fees wef date of business
transfer i.e. 21 March 2025.
46 AUDIT TRAIL AND DAILY BACK UP
As per the Ministry of Corporate Affairs (MCA) notification, proviso to Rule 3(1) of the Companies (Accounts)
Rules, 2014, for the financial years commencing from April 1, 2023, every company which uses accounting software
for maintaining its books of account, shall use only such accounting software which has a feature of recording
audit trail of each and every transaction, creating an edit log of each change made in the books of account along
with the date when such changes were made and ensuring that the audit trail cannot be disabled.
The Company has used an accounting software for maintaining its books of account which has a feature of
recording audit trail (edit log) facility that has operated throughout the financial year for all relevant transactions
except:
1 For Accounting software used to maintain general ledger, which is operated by a third-party software service
provider, the service provider auditor has not reported controls w.r.t audit trail in the Independent auditor's
report.
2 For Accounting software used to maintain PMS revenue and its client balances, the audit trail feature has not
been enabled till 15 September 2025. With effect from 16 September 2025, the Company has moved from its
legacy software to a new software, managed by a third party service provider for which the service provider
auditor has not issued the Independent auditor's report for the relevant period.
Except for the matters reported above, the audit trail was not tampered with during the year.
Further, except in respect of periods in previous years where the audit trail (edit log) facility was not enabled or
retained, and except for the matter discussed above, the Company has preserved the audit trail in accordance
with the statutory requirements for record retention.
In respect of the new software used for maintaining PMS revenue and its client balances, which is managed by a
third-party service provider, the independent auditor's report for the current year was not available.
47 REVENUE FROM CONTRACTS WITH CUSTOMERS
The Company is engaged in the business of retail and institutional broking and distribution of financial products.
In accordance with Ind AS 115, Revenue from Contracts with Customers, the revenue is accounted in the following
manner for each head:
a) Distribution of financial products:
The Company distributes various financial products and other services to the customers on behalf of third
party i.e. the Company acts as an intermediary for distribution of financial products and services. The
Company executes contracts with the Principal, viz AMC's, Mutual Funds, Bank, Insurance Company etc. to
procure customers for its products. As a consideration, the Company earns commission income from the
third parties for the distribution of their financial products. The commission is accounted net of claw back if
any, due to non-fulfilment of contract by the customer with the principal. The customer obtains control of the
47 REVENUE FROM CONTRACTS WITH CUSTOMERS (CONTD..)
service on the date when customer enters into a contract with principal and hence subscription or contract
date is considered as the point in time when the performance obligation has been satisfied.
b) Interest income
Interest income is recognised using the effective interest rate method.
In case of annual maintenance charges (AMC) of depository, the customer has the option of paying in
advance. In such cases, contract liability relates to payments received in advance of performance under the
contract. Contract liabilities are recognised as revenue on completing the performance obligation.
c) Depository and portfolio management services
Income from depository services, penal charges and portfolio management services are recognised on
the basis of agreements entered into with clients and when the right to receive the income is established.
It is recognised at the point in time for transaction charges and performance based PMS fee and others
are recognised over the period of service as applicable. Depository business has been transferred by the
Company to its wholly owned subsidiary Geojit Investments Limited. Also refer Note 44 (Transfer of broking
and depository business and discontinued operations)
d) Brokerage income:
The Company provides trade execution and settlement services to the customers in retail and institutional
segment. There is only one performance obligation of execution of the trade and settlement of the transaction
which is satisfied at a point in time. The brokerage charged is the transaction price and is recognised as
revenue on trade date basis. Related receivables are generally recovered in a period of 1 day as per the
settlement cycle. This business has been transferred by the Company to its wholly owned subsidiary Geojit
Investments Limited. Also refer Note 44 (Transfer of broking and depository business and discontinued
operations)
48 The Company will be adopting Division II of Schedule III from Financial Year ending 31 March 2027, post
surrender of Stock Broking License. Accordingly, Proforma Balance Sheet, Statement of Profit and Loss and
ratios (As per Division II of Schedule III) are provided as voluntary additional disclosures as below.
Note
1 The Company has repaid its debt during the year.
2 Since there is no borrowing cost and outstanding debt, hence this ratio is not applicable
3 The return on equity has increased due to increase in profit on account of increase in business operations.
4 Trade receivable turnover ratio has imporved on account of better collection
5 Since the company is into financial services, it doesn't have any purchase and hence this ratio is not
applicable.
6 The ratio has improved on account of increase in operations.
7 The net profit has improved due to mark up on cost allocation to a subsidiary and increase in business
operations.
8 Return on capital employed has increased due to increase in profit on account of increase in business
operations.
49 Additional regulatory information pursuant to the requirement in Division III of Schedule III to the Companies
Act, 2013
i) The Company does not have any Benami property, nor any proceeding has been initiated or pending
against the Company for holding any Benami property.
ii) The Company does not have any transactions with struck off companies.
iii) The Company has not revalued its property, plant and equipment (including right-of-use assets) or
intangible assets or both during the current or previous year.
iv) The Company has not traded or invested in cryptocurrency or virtual currency during the financial year.
v) The Company has not any such transaction which is not recorded in the books of accounts that has been
surrendered or disclosed as income during the year in the tax assessments under the Income Tax Act, 1961
(such as, search or survey or any other relevant provisions of the Income Tax Act, 1961)
vi) None of the entities in the Company have been declared wilful defaulter by any bank or financial institution
or government or any government authority.
vii) The Company has complied with the number of layers prescribed under the Companies Act, 2013.
viii) The Company has not entered into any scheme of arrangement, other than disclosed under Note 44 which
has an accounting impact on current or previous financial year.
ix) The Company has not obtained any term loans during the year.
50 a) No funds 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 persons or entities, including
foreign entities (“Intermediaries”), with the understanding, whether recorded in writing or otherwise,
that the Intermediary shall, 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) No funds have been received by the Company from any persons or entities, including foreign entities
(“Funding Parties”), with the understanding, whether recorded in writing or otherwise, that the
Company shall, 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.
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