N. Provisions
Provisions are recognised when the Company has 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 a reliable estimate can be made of the amount of the
obligation.
Where the effect of time value of money is material, provisions are measured at present value using a pre-tax discount rate that refects current
market assessment of the time value of money and risks specific to liability. The increase in the provision due to passage of time is recognised as
interest expense.
O. Contingent Liabilities and Assets
A contingent liability is a possible obligation that arises from past events whose existence will be confirmed by the occurrence or non-occurrence of
one or more uncertain future events beyond the control of the Company or a present obligation that is not recognised because it is not probable
that an outflow of resources will be required to settle the obligation. The Company does not recognise a contingent liability but discloses its existence
in the financial statements. Contingent assets are not recognised in the financial statements.
P Segment Reporting
Operating segments are reported in a manner consistent with the internal reporting provided to the chief operating decision maker.
Q. Events after Reporting date
Where events occurring after the Balance Sheet date provide evidence of conditions that existed at the end of the reporting period, the impact of such
events is adjusted within the financial statements. Otherwise, events after the Balance Sheet date of material size or nature are only disclosed.
R. Recent applicable Accounting 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. During the year ended March 31, 2025, MCA has notified Ind AS - 117 Insurance Contracts and
amendments to Ind AS 116 - Leases, relating to sale and leaseback transactions, applicable from April 1, 2024. The Company has assessed that
there is no significant impact in its financial statements.
On May 9, 2025, MCA notifies the amendments to Ind AS 21 - Effects of Changes in Foreign Exchange Rates. These amendments aim to provide
clearer guidance on assessing currency exchangeability and estimating exchange rates when currencies are not readily exchangeable. The
amendments are effective for annual periods beginning on or after April 1, 2025. The Company is currently assessing the probable impact of
these amendments on its financial statements.
4: Significant Accounting Judgements, Estimates and Assumptions
The preparation of the financial statements requires management to make judgements, 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.
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 refected in the assumptions when they occur.
( a) Defined Benefit Plans
The cost of the defined benefit gratuity plan and the present value of the gratuity 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 and mortality rates. 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.
The parameter most subject to change is the discount rate. In determining the appropriate discount rate for plans operated in India, the
management considers the interest rates of government bonds in currencies consistent with the currencies of the post-employment benefit
obligation.
(b) Estimates and Assumptions
When the fair values of financial assets and financial liabilities recorded in the balance sheet cannot be measured based on quoted prices in active
markets, their fair value is measured using valuation techniques including the DCF model. The inputs to these models are taken from observable
markets where possible, but where this is not feasible, a degree of judgement is required in establishing fair values. Judgements include
considerations of inputs such as liquidity risk, credit risk and volatility. Changes in assumptions about these factors could affect the reported fair
value of financial instruments.
(c) Depreciation/Amortisation and Useful Lives of Property, Plant and Equipment/IntangibleAssets
Property, plant and equipment / intangible assets are depreciated / amortised over their estimated useful lives, after taking into account estimated
residual value. Management reviews the estimated useful lives and residual values of the assets annually in order to determine the amount of
depreciation / amortisation to be recorded during any reporting period. The useful lives and residual values are based on the Company's historical
experience with similar assets and take into account anticipated technological changes. The depreciation / amortisation for future periods is
revised if there are significant changes from previous estimates.
(d) Impairment of Financial Assets
The Company reviews its carrying value of investments carried at amortized cost annually, or more frequently when there is indication of
impairment. If recoverable amount is less than its carrying amount, the impairment loss is accounted for.
(e) Impairment of Non Financial Assets
The Company assesses at each reporting date whether there is an indication that an asset may be impaired. If any indication exists, the Company
estimates the asset's recoverable amount. An asset's recoverable amount is the higher of an asset's or Cash Generating Units (CGU's) fair value
less costs of disposal and its value in use. Where the carrying amount of an asset or CGU exceeds its recoverable amount, the asset is considered
impaired and is written down to its recoverable amount.
Determination of the recoverable amount involves management estimates on highly uncertain matters, such as commodity prices and their impact
on markets and prices for upgraded products, development in demand, inflation, operating expenses and tax and legal systems. The Company uses
internal business plans, quoted market prices and the Company's best estimate of commodity prices, currency rates, discount rates and other
relevant information. A detailed forecast is developed for a period of three to five years with projections thereafter. The Company does not include a
general growth factor to volumes or cash flows for the purpose of impairment tests, however, cash flows are generally increased by expected
inflation and market recovery towards previously observed volumes is considered.
(f) Taxes
The Company calculates income tax expense based on reported income. Deferred income tax expense is calculated based on the differences
between the carrying value of assets and liabilities for financial reporting purposes and their respective tax basis that are considered temporary
in nature. Valuation of deferred tax assets is dependent on management's assessment of future recoverability of the deferred benefit.
Expected recoverability may result from expected taxable income in the future, planned transactions or planned tax optimizing measures. Economic
conditions may change and lead to a different conclusion regarding recoverability.
41: Financial Risk Management - Objectives and Policies
The company's principal financial liabilities comprise borrowings, trade payables, other financial liabilities and financial guarantee contracts. The main purpose
of these financial liabilities is to finance the Company's operations. The Company's financial assets include investments, trade receivables, cash and cash
equivalents, other bank balances, loans and other financial assets.
The Company is exposed to market risk, credit risk and liquidity risk. The Company has a Risk management policy and its management is supported by a
Risk management committee that advises on risks and the appropriate risk governance framework for the Company. The Risk management committee
provides assurance to the Company's management that the Company's risk activities are governed by appropriate policies and procedures and that risks are
identified, measured and managed in accordance with the Company's policies and risk objectives. The Board of Directors reviews and agrees policies for
managing each of these risks, which are summarised below.
( i) Market risk
Market risk is the risk that the fair value of future cash flows of a financial instrument will fluctuate because of changes in market prices. Market risk comprises
two types of risk: currency risk and other price risk, such as commodity price risk and equity price risk. Financial instruments affected by market risk include
FVTOCI investments, FVTPL investments, trade payables, trade receivables, etc.
(a) Foreign currency risk
Foreign currency risk is the risk that the fair value or future cash flows of a foreign currency exposure will fluctuate because of changes in foreign exchange rates.
The Company's exposure to the risk of changes in foreign exchange rates relates primarily to the Company's operating activities. The Company monitors the
foreign exchange fluctuations on continuous basis and advises the management of any material adverse effect on the Company and for taking risk mitigation
measures. The Company enters into forward exchange contracts against its foreign currency exposure relating to underlying liabilities and firm commitments.
The Company does not enter into any derivative instruments for trading or speculative purposes.
Foreign currency sensitivity
The following table demonstrates the sensitivity to a reasonably possible change in USD, Euro and JPY exchange rates, with all other variables held constant. The
impact on the Company's profit before tax is due to likely changes in the fair value of monetary assets and liabilities. The Company's exposure to foreign currency
changes for all other currencies is not material.
(Rs. in million)
(ii) Credit risk
Credit risk is the risk that counterparty will not meet its obligations under a financial instrument or customer contract, leading to a financial loss. The Company is
exposed to credit risk from its operating activities (primarily trade receivables).
Trade receivables
An impairment analysis is performed at each reporting date on an individual basis for all the customers. In addition, a large number of minor receivables are
grouped into homogenous groups and assessed for impairment collectively. The calculation is based on credit losses historical data. The maximum exposure to
credit risk at the reporting date is the carrying value of trade receivables disclosed as the Company does not hold collateral as security. The Company has
evaluated the concentration of risk with respect to trade receivables as low, as its customers are located in several jurisdictions and industries.
(iii) Liquidity risk
Liquidity risk is the risk that Company will encounter difficulty in raising funds to meet commitments associated with financial instruments that are settled
by delivering cash or another financial asset. Liquidity risk may result from an inability to sell a financial asset quickly at close to its fair value.
The Company has an established liquidity risk management framework for managing its short term, medium term and long term funding and liquidity
management requirements. The Company's exposure to liquidity risk arises primarily from mismatches of the maturities of financial asset and liabilities.
The Company manages the liquidity risk by maintaining adequate funds in cash and cash equivalents. The Company also has adequate credit facilities agreed
with banks to ensure that there is sufficient cash to meet all its normal operating commitments in a timely and cost-effective manner.
The table below analyse the financial liabilities of the Company into relevant maturity groupings based on the remaining period from the reporting date to the
contractual maturity date. The amount disclosed in the table are the contractual undiscounted cash flow.
42: Capital Management
The Company being in a capital intensive industry, its objective is to maintain a strong credit rating, healthy capital ratios and establish a capital structure that
would maximise the return to stakeholders through optimum mix of debt and equity.
The Company's capital requirement is mainly to fund its capacity expansion, repayment of principal and interest on its borrowings and strategic acquisitions.
The principal source of funding of the Company has been, and is expected to continue to be, cash generated from its operations supplemented by funding from
bank borrowings and the capital markets. The Company is not subject to any externally imposed capital requirements.
The Company regularly considers other financing and refinancing opportunities to diversify its debt profile, reduce interest cost and elongate the maturity of
its debt portfolio, and closely monitors its judicious allocation amongst competing capital expansion projects and strategic acquisitions, to capture market
opportunities at minimum risk.
The Company monitors its capital using gearing ratio, which is net debt, divided to total equity. Net debt includes, interest bearing loans and borrowings less cash
and cash equivalents.
(Rs. in million)
47. None of the Loans or Advances in the nature of loans as at 31st March, 2025 and as at 31st March, 2024 are granted to promoters, directors, KMPs and
the 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.
48 . The company has used the borrowings from banks and financial institutions for the specific purpose for which it was taken at the balance sheet date.
49. No proceedings have been initiated or pending against the company for holding any benami property under the Benami Transactions (Prohibition) Act,
1988 (45 of 1988) and the rules made there under.
50. All the Registration of Charges or Satisfaction of Charges with the Registrar of Companies are completed within the statutory period.
51. The company has complied with the number of layers prescribed under clause (87) of section 2 of the Companies Act read with Companies (Restriction
on number of Layers) Rules, 2017.
52 . The Company has not advanced or loaned or invested funds (either borrowed funds or share premium or any other sources or kind of funds) to any other
person(s) or entity(ies), including foreign entities (Intermediaries) with the understanding (whether recorded in writing or otherwise) that the
Intermediary shall (i) 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 (ii) provide any guarantee, security or the like to or on behalf of the Ultimate Beneficiaries.
53. 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 (i) 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 (ii) provide any guarantee, security or the like on behalf of the Ultimate
Beneficiaries.
54. The Company does not have any transaction which is not recorded in the books of accounts that has been surrendered or disclosed as income during the
year ended 31st March, 2025 and 31st March, 2024 in the tax assessments under the Income Tax Act, 1961.
55. The Company has not traded or invested in Crypto currency or Virtual Currency during the financial year.
56. The company has not been declared wilful defaulter by any bank or financial Institution or other lender.
Signature to Note 1 to 56
Asperourreportofevendateannexed For and on behalf of the Board
For SINGHI & CO.
Chartered Accountants
Firm Registration No. 302049E SIDHARTH K. BIRLA R. V. KANORIA
RAHUL BOTHRA Director Managing Director
Partner (DIN:00004213) (DIN:00003792)
Membership No. 067330
P N. K. NOLKHA PRATIBHA JAISWAL
Place: New Delhi Group Chief Financial Officer Company Secretary
Date: 21st May, 2025 (ACS: 33981)
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