4. There are no proceedings initiated or pending against the Company for holding any benami property under the Prohibition of Benami Property Transactions Act, 1988
5. Capital Work-in-Progess includes borrowing cost of H 3.16 Crore capitalised as per Ind AS 23 "Borrowings Cost" on qualifying asset.
3. There are no loans or advances which are in the nature of loans that have been granted by the Company to promoters, directors, Key Managerial Personnels and the related parties (as defined under the Companies Act,2013),either severally or jointly with any other person that are repayable on demand or without specifying any terms or period of repayment.
4. Refer Note 40.5.15 on risk management objectives and policies for financial instruments.
5. Refer Note 40.5.11 on related party disclosures for details on loans granted to related parties.
1. The Company’s manufacturing facility at Kagal plant had been granted Mega Project status by Government of Maharashtra and hence was eligible for Industries Promotion Subsidy (IPS) under Package Scheme of Incentive (PSI) 2001. This scheme was for intensifying and accelerating the process of dispersal of industries to the less developed regions and promoting high-tech industries in the less developed areas of the state coupled with the object of generating employment opportunities. During the last quarter of FY 2018-19, the Government of Maharashtra had agreed for extension of the said scheme of incentive for further period of 2 years till 31 March 2019 and subsequently amended the original eligibility certificate. Accordingly the extension of the scheme consists of total period of 11 years from the date of commencement of commercial production i.e. from 1 April 2008 to 31 March 2019 along with the extension of original operative period by 2 years and compliances thereof. The eligible subsidy receivables computed on the basis of VAT, CST as well as SGST paid on sales made from Kagal plant for such extended period are fair valued as on 31 March 2024.
2. Other financial assets are measured at amortised cost.
3. Refer Note 40.5.15 on risk management objectives and policies for financial instruments.
5. Refer Note 40.5.15 on credit risk of trade receivables, which also explains how the Company manages and measures credit quality of trade receivables that are neither past due nor impaired.
6. The carrying amount of the trade receivables include receivables which are subject to the export sales bill discounting arrangement. However, where the Company has retained the credit risks, it continues to recognise these assets in entirety in its Balance sheet, while bills discounted without recourse have been derecognised. The amount repayable under this arrangement is presented as borrowings.
1. Loans are measured at amortised cost.
2. Loans due from private companies in which director of the Company, is a director or a member as at 31 March 2024 is H 10.72 Crores (31 March 2023 : H 21.85 Crores)
3. There are no loans or advances which are in the nature of loans that have been granted by the Company to promoters, directors, Key Managerial Personnels and the related parties (as defined under the Companies Act,2013),either severally or jointly with any other person that are repayable on demand or without specifying any terms or period of repayment.
4. Refer Note 40.5.15 on risk management objectives and policies for financial instruments.
5. Refer Note 40.5.11 on related party disclosures for details on loans granted to related parties.
1. Other financial assets, except derivative assets, are measured at amortised cost. Derivative instruments are carried at fair value through profit and loss.
2. Derivative assets reflect the positive change in fair value of those foreign exchange forward contracts that are not designated in hedge relationship, but are nevertheless, intended to reduce the level of foreign currency risk exposure.
3. Other receivables due from private companies in which director of the Company is , a director or a member as at 31 March 2024 H 5.12 Crores (31 March 2023 : H 2.77 Crores). Refer Note 40.5.11 for details.
4. Refer Note 40.5.13 for fair value disclosure of financial assets and financial liabilities and Note 40.5.14 for fair value hierarchy.
5. Refer Note 40.5.15 on risk management objectives and policies for financial instruments.
6. Also Refer Note 5 for additional details on Subsidy receivable under PSI scheme, 2001
Terms/Rights attached to the equity shares
The Company has only one class of equity shares having a par value of H 2 each. Each equity shareholder is entitled to one vote per share and has a right to receive dividend as recommended by Board of Directors subject to the necessary approval from the shareholders.
In the event of liquidation of the Company, the holders of equity shares will be entitled to receive remaining assets of the Company, after distribution of all preferential amounts. The distribution will be in proportion to the number of equity shares held by the shareholders.
Equity shares reserved for issue under employee stock option plan : 5,64,045 (31 March 2023: 7,72,768) equity shares.
The Company has share suspense account which represents equity shares of H 2 each to be issued and allotted to shareholders of erstwhile Shivaji Works Ltd. on amalgamation according to scheme sanctioned by Board of Industrial and Financial Reconstruction (BIFR) which are kept in abeyance as per the Scheme of Arrangement approved by Hon'ble High Court of Judicature at Bombay vide its order dated 31 July 2009 read with order dated 19 March 2010.
1. Share application money pending allotment, represents amount received from employees who have exercised Employee Stock Option Plan (ESOP) for which shares are pending allotment as on balance sheet date.
2. Capital redemption reserve is created out of General reserve being nominal value of shares bought back in terms of erstwhile section 77A of the Companies Act, 1956 for equity shares buy back in the year 2012-13.
3. Securities Premium represents the amount received in excess of face value of the equity shares. In case of equity-settled share based payment transactions, the difference between fair value on grant date and nominal value of share is accounted as securities premium. 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
4. General reserve is created by setting aside amount from the Retained Earnings of the Company for general purposes which is freely available for distribution.
5. Equity instruments through other comprehensive income represents the cumulative gains and losses arising on the valuation of equity instruments measured at fair value through other comprehensive income, under an irrevocable option, net of amounts reclassified to retained earnings when such assets are disposed off and is not available for distribution of dividend.
6. Employee stock option reserve is used to record the fair value of equity-settled share based payment transactions with employees. The amounts recorded in share options outstanding account are transferred to securities premium upon exercise of stock options and transferred to general reserve on account of vested stock options not exercised by employees. Refer Note No. 40.5.19 for disclosure on Employee stock option plan (ESOP) of the Company.
1. Borrowings are measured at amortised cost.
2. Term Loans from Banks
During the year, the Company has availed term loan of H107.21 crores for the purchase of immovable property. The loan is to be repaid in monthly installments of H 2.50 Crores each starting from December 2023 with rate of interest linked to repo rate plus applicable spread i.e effective 7.80% p.a. The term loan is secured by an exclusive charge on the immovable property purchased through the term loan facility and hypothecation of movable fixed assets acquired through the term loan facility. The carrying amount of the loan as at 31 March 2024 is H 97.21 crores. Refer Note 24- Current Borrowings for current maturities of this long term borrowings.
4. There has been no default in repayment of interest and principal amount for year ended 31 March 2024 and 31 March 2023.
5. For explanations on the Company's interest risk, foreign currency risk and liquidity risk management processes, refer to Note 40.5.15
2. The Company offsets tax assets and liabilities if and only if it has a legally enforceable right to set off current tax assets and current tax liabilities and the deferred tax assets and deferred tax liabilities relate to income taxes levied by the same tax authority.
1. Borrowings are measured at amortised cost.
2. Secured Borrowings- The Company's fund and non-fund based working capital facilities aggregating to H 385 Crores are secured by way of hypothecation (First Charge) on the whole of the current assets of the Company both present and future in favour of the consortium of banks (SBI Consortium) comprising of State Bank of India, Pune (Lead Bank), Bank of Maharashtra, ICICI Bank Limited, HDFC Bank Limited, and The Hongkong and Shanghai Banking Corporation Limited (HSBC). The Board of Directors of the Company had given their approval for reduction of H 410 Crores consortium limit to H 385 Crores and also to appoint 'Axis Trustee Services Private Limited' as a Security Trustee. The Company has appointed 'Axis Trustee Services Private Limited' as Security Trustee and is in process of execution of necessary agreements with Consortium Bankers to give effect to the reduction of working capital facilities and hypothecation charge from H 410 Crores to H 385 Crores . Accordingly, the necessary forms will be filed with the Ministry of Corporate Affairs/Registrar of Companies for modification of charge created to the extent of reduction in working capital facilities.
3. The quarterly returns or statements of current assets filed by the Company with banks are in agreement with the books of account.
4. There has been no default in repayment of interest and principal amount for year ended 31 March 2024 and 31 March 2023
5. For explanations on the Company's Interest risk, foreign currency risk and liquidity risk management processes, refer to Note 40.5.15
1. Employee benefits obligations
a. Gratuity
The Company provides gratuity for employees as per the Gratuity Act, 1972 and the Company's internal Gratuity Scheme. Employees who are in continuous service for a period of five years are eligible for gratuity. The amount of gratuity is payable on retirement or termination whichever is earlier. The level of benefits provided depends on the member’s length of service and salary at retirement age. The gratuity plan is funded plan.
b. Pension and other retirement benefits
The Company provides certain post-employment medical scheme and long term award benefits to employees (unfunded). For long-term award scheme, the Company has defined certain eligibility criteria and grade-wise benefit available to employees and is payable only at time of separation. Pension and medical benefits are payable to specified category of employees for 15 years after retirement.
c. Compensated absences
The leave obligation cover the Company's liability for earned leaves.
Also refer Note 40.5.9 for detailed disclosure.
2. Others
a. Warranty is provided to customers at the time of sale of products. Warranty cost includes expenses in connection with repairs, free replacement of parts / engines and after sales services during warranty period which varies from 1 year to 4 years.
Provision is made for estimated warranty claims in respect of products sold which are still under warranty at the end of reporting period. It is expected that majority of these costs will be incurred in the next financial year and balance will be incurred in following years. Management estimates the provision based on historical warranty claim information and any recent trends that may suggest future claims could differ from historical amounts.
b. The Company has preferred an Appeal bearing No. 125 of 2016 before the Chief Controlling Revenue Authority (CCRA) against the Stamp Duty Adjudication Order dated 2 May 2016 bearing ADJ/188/2015 passed by Collector of Stamps, Enforcement - II, Mumbai levying a total stamp duty amount of H 14.94 Crores on the Company for amalgamation of KBIL with the Company. For securing a Stay Order against the said Stamp duty Adjudication being ADJ/188/2015 dated 2 May 2016, the Company has deposited 50% of the stamp duty amount of H 7.47 Crores on protest on 30 June 2016. Considering the payment of 50% of stamp duty amount, through its Order dated 22 September 2016, CCRA has passed an Order granting stay on the effect and operation of said Stamp Duty Adjudication Order bearing ADJ/188/2015 dated 2 May 2016. The Company’s Appeal bearing No. 125 of 2016 is still pending and listing for final hearing is awaited. Accordingly, provision for stamp duty of H 14.94 Crores has been made.
c. Provision for liquidated damages pertains to provision arising due to delay in actual delivery of goods/services as against the contractual delivery date.
d. Provision for onerous contracts pertains to the provision for the unavoidable costs of meeting the obligations under the contract which exceeds the economic benefits expected to be received under it. The unavoidable costs under a contract reflect the least net cost of exiting from the contract, which is the lower of the cost of fulfilling it and any compensation or penalties arising from failure to fulfil it.
c. Information about performance obligation
i The Company is mainly in the business of manufacturing and trading of engines, gensets and related spares. The Company also provides after sales services such as annual maintenance contract, extended warranty etc.
ii The Company generally recognises revenue in case of goods, when the performance obligation is satisfied at a point in time when the control is transferred i.e. either on shipment or upon delivery as per the terms of contracts in domestic and in case of export on the date of bill of lading.
In case of services, where performance obligation is satisfied at a point in time, revenue is generally recognised upon completion of services and on obtaining work completion certificates from the customers. In contracts under which performance obligation satisfied over a period of time, Revenue is generally recognised either according to stage of completion or on straight line basis depending upon the type of services provided. The stage of completion is determined based on the contractual terms.
When the Company’s efforts or inputs are expended evenly throughout the performance period revenue is recognised straight-line basis.
The payment is due from the date of invoice and payment terms are generally in the range of 0 days to 90 days depending on product/market segment and market channel excluding some exceptions.
iii The Company provides to its customers warranties in the forms of repairs or replacement warranty under its standard terms and recognises it as warranty provision as per Ind AS 37 “Provisions, Contingent Liabilities and Contingent Assets
d. Unsatisfied performance obligations as at the end of reporting period:
As on 31 March 2024, the Company has unsatisfied performance obligation of H 91.61 Crores (31 March 2023 : H 80.09 Crores). The Company expects that H 60.32 Crores will be recognised as revenue in financial year 2024-25 and remaining in subsequent years based on contractual terms.
e. Asset recognised for cost incurred to obtain a contract and cost incurred to fulfil Contract
The Company has recognised an asset as on 31 March 2024 of H 4.40 Crores (31 March 2023 : H 5.57 Crores) from cost incurred to obtain and fulfill a contract. Asset is included in Note 15 Other current asset : Prepaid expenses.
5.9: Disclosure pursuant to Employee benefits
A. Defined contribution plans:
Amount of H14.07 Crores (March 31 2023: H 12.14 Crores) is recognised as expenses and included in Note No. 35 "Employee benefit expense"
B. Defined benefit plans:
The Company has following post employment benefits which are in the nature of defined benefit plans:
(a) Gratuity
(b) Pension, Post retirement medical scheme and Long-term award scheme
Risk Exposure
Through its defined benefit plan, the Company is exposed to a number of risks, the most significant of which are detailed below:
a. Discount rate risk: Variations in the discount rate used to compute the present value of the liabilities may see small, but in practise can have a significant impact on the defined benefit liabilities.
b. Future salary escalation and inflation risk: Since price inflation and salary growth are linked economically, they are combined for disclosure purposes. Rising salaries will often result in higher future defined benefit payments resulting in a higher present value of liabilities especially unexpected salary increases provided at management's discretion may lead to uncertainities in estimating this increasing risk.
c. Asset risks: Plan assets are maintained in a self-managed trust fund mainly managed by investments in leading Mutual Fund companies, special deposits and a small part of fund is managed by a public sector insurer viz; LIC of India.
LIC has a sovereign guarantee and has been providing consistent and competitive returns over the years. The Company has opted for a traditional fund wherein all assets are invested primarily in risk averse markets. The Company has no control over the management of funds but this option provides a high level of safety for the total corpus. Also interest rate and inflation risk are taken care of.
The Company has opted for Mutual Funds which is market linked with options to invest in equity funds. The Company has the option to structure the portfolio based on its risk appetite providing an opportunity to earn market linked returns. But there is an investment risk here which is borne by the Company.
A single account is maintained for both investment and claim settlement and hence 100% liquidity is ensured.
d. Asset-Liability mismatch risk: Risk which arises if there is a mismatch in the duration of the assets relative to the liabilities. By matching duration with the defined benefit liabilities, the Company is successfully able to neutralize valuation swings caused by interest rate movements.
e. Unfunded Plan Risk - This represents unmanaged risk and a growing liability. There is an inherent risk here that the Company may default on paying the benefits in adverse circumstances. Funding the plan removes volatility from the balance sheet and better manages defined benefit risk through increased returns.
Funding policy:
There is no compulsion on the part of the Company to fully prefund the liability of the Gratuity Plan. The Company’s philosophy is to fund these benefits based on its own liquidity and the level of underfunding of the plan.
Transactions with related parties are inclusive of indirect taxes, wherever applicable.
The above figures do not include provision for leave encashment and gratuity, as actuarial valuation of such provision for the Key Management Personnel is included in the total provision for Leave encashment and gratuity.
(Refer Note 42 for details of amalgamation of LGM and OPEPL. The appointed date for amalgamation is w.e.f 1 April 2023. The amounts for previous year relating to OPEPL have been regrouped and included in LGM accordingly)
Terms and conditions of transactions with related parties
Transactions entered into with related party are made in ordinary course of business and on terms equivalent to those that prevail in arm’s length transactions. Outstanding balances at the year end are unsecured and interest free and settlement occurs in cash and cash equivalents. There have been no guarantees provided or received for any related party receivables or payables. For the year ended 31 March 2024, the Company has not recorded any impairment of receivables relating to amounts owed by related parties (31 March 2023: H Nil). This assessment is undertaken each financial year through examining the financial position of the related party and the market in which the related party operates.
Commitments with related parties
The Company has provided capital commitment of HNil to the related parties as at 31 March 2024 (31 March 2023: HNil)
The amounts disclosed in the table are the amounts recognised as an expense during the reporting period related to Key Management Personnel.
The above figures do not include provision for leave encashment and gratuity, as actuarial valuation of such provision for the Key Managerial Personnel is included in the total provision for Leave encashment and gratuity.
The amounts disclosed in the table are the amounts recognised as an expense during the reporting period related to Key Management Personnel.
Earnings per share are calculated in accordance with Accounting Standard (Ind AS 33) “Earnings Per Share”.
5.13 Fair value disclosures for financial assets and financial liabilities
The management believes that the fair values of non-current financial assets (e.g., Investments at FVTPL, loans and others), current financial assets (e.g., cash and cash equivalents, trade and other receivables, loans), non-current financial liabilities and current financial liabilities (e.g., Trade payables and other payables and others) approximate their carrying amounts.
The Company has performed a fair valuation of its material investment in unquoted ordinary shares other than subsidiary, which are classified as FVOCI (refer Note 3). For non-material investments, the Company believes that impact of change, if any, on account of fair value is insignificant.
Fair value of unquoted investment in Mutual fund is determined by reference to Net Asset Value ('NAV') available from respective Assets Management Companies ('AMC').
b Significant unobservable inputs used in level 3 fair value measurements and sensitivity of the fair value measurement to changes in unobservable inputs:
i Description of significant unobservable inputs used for financial instruments (Level 3) :
Investment in Equity shares of Kirloskar Management Sevices Private Limited (KMSPL) was valued using the Discounted Cash Flow (Risk adjusted discount rate) valuation method.
ii Relationship of unobservable inputs to level 3 fair values :
Equity investments - Unquoted
A 50 bps increase/decrease in the Perpetuity growth rate used while keeping all other variables constant, the carrying value of the shares would increase by H 0.05 (31 March 2023 : H Nil ) or decrease by H 0.05 Crores (31 March 2023 : H 0.05 Crores ) and a 50 bps increase/decrease in discounting factor used while keeping all other variables constant, the carrying value of the shares would decrease by H 0.05 Crores (31 March 2023 : H 0.10 Crores) or increase by H 0.05 Crores (31 March 2023 : H 0.05 Crores).
5.15 Financial instruments risk management objectives and policies
The Company’s principal financial liabilities, other than derivatives, comprise borrowings, trade and other payables and other financial liabilities. The main purpose of these financial liabilities is to finance and support the Company’s operations. The Company’s principal financial assets include Investments, loans, trade and other receivables, cash and short-term deposits and other financial assets that have been derived directly from its operations. The Company also enters into derivative transactions.
The Company is exposed to market risk, credit risk and liquidity risk. The Company’s senior management oversees the management of these risks. The Audit Committee and Board review financial risks and the appropriate risk governance framework for the Company’s financial risks are identified, measured and managed in accordance with the Company’s policies and risk objectives. It is the Company’s policy that no trading in derivatives for speculative purposes may be undertaken. The Board of Directors reviews and agrees policies for managing each of these risks, which are summarised below
a 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 three types of risk: interest rate risk, currency risk and other price risk, such as equity price risk and commodity risk. Financial instruments affected by market risk include borrowings, deposits, Investments, trade and other receivables, trade and other payables and derivative financial instruments.
The sensitivity analysis in the following sections relate to the position as at 31 March 2024 and 31 March 2023
The analysis exclude the impact of movements in market variables on: the carrying values of gratuity, pension and other post-retirement obligations and provisions.
The following assumption has been made in calculating the sensitivity analysis:
The sensitivity of the relevant Statement of Profit and Loss item is the effect of the assumed changes in respective market risks. This is based on the financial assets and financial liabilities held at 31 March 2024 and 31 March 2023 including the effect of hedge accounting.
Commodity price risk
The Company is affected by the price volatility of certain commodities. Its operating activities require the on-going purchase and manufacture of engines and therefore require a continuous supply of copper and steel. However, Company being the indirect user of these commodities, volatility in price of such commodity does not have direct or immediate impact on the profitability of the Company. Hence, the Company does not foresee any direct or immediate risk with respect to such commodity price fluctuation.
Other Price Risk
The Company’s portfolio of investments mainly consists of debt mutual fund with short term maturity. Hence management believes that this portfolio is not significantly susceptible to market risk.
b 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) and from its financing activities, including deposits with banks, foreign exchange transactions and other financial instruments.
Trade receivables
Receivables are reviewed, managed and controlled for each class of customers separately. Credit exposure risk is mainly influenced by class /type of customers, depending upon their characteristics. Credit risk is managed through credit approval process by establishing credit limits along with continuous monitoring of credit worthiness of customers to whom credit terms are granted. Wherever required, credit risk of receivables is further covered through letter of credit, bank guarantee, business deposits and such other forms of credit assurance schemes.
An impairment analysis is performed at each reporting date on an individual basis for major clients. In addition, a large number of minor receivables are combined into homogenous category and assessed for impairment collectively. The calculation is based on actual incurred historical data. The Company does not hold collateral as security. The Company evaluates the concentration of risk with respect to trade receivables as low, as its customers are spread over vast spectrum.
The Company consistently recognizes provision for any significantly delayed receivables, for accounting of expected credit losses. Provision for doubtful debts and advances as at 31 March 2024 includes a fully provided receivable of H 41.47 crore (31 March 2023 : H 28.09 crore) in respect of receivables against sales of Gensets to a customer made in previous years. The aforesaid provision is net of reversal of H 4.98 crore arising on account of receipt of payment from the customer during the current year. While the Company is in active discussions with the customer for the remaining payment, the aforesaid provision has been continued as per the consistent policy of the Company for accounting of expected credit losses.
Financial instruments and cash deposits
Credit risk from balances with banks and financial institutions is managed by the Company’s treasury department in accordance with the Company’s policy. Investments of surplus funds are made as per the approved investment policy. Investment limits are set to minimise the concentration of risks and therefore mitigate financial loss if any.
c Liquidity risk
The Company monitors its risk of a shortage of funds using a liquidity planning tool.
The Company’s objective is to maintain a balance between continuity of funding and flexibility through the use of bank overdrafts, bank loans. The Company has access to a sufficient variety of sources of funding and debt maturing within 12 months can be rolled over with existing lenders.
Excessive risk concentration
Concentrations arise when a number of counterparties are engaged in similar business activities, or activities in the same geographical region, or have economic features that would cause their ability to meet contractual obligations to be similarly affected by changes in economic, political or other conditions. Concentrations indicate the relative sensitivity of the Company's performance to developments affecting a particular industry.
In order to avoid excessive concentrations of risk, the Company’s policies and procedures include specific guidelines to focus on the maintenance of a diversified portfolio. Identified concentrations of credit risks are controlled and managed accordingly. Selective hedging is used within the Company to manage risk concentrations at both the relationship and industry levels.
5.16 Capital management
For the purpose of the Company’s capital management, capital includes issued equity capital and all other equity reserves attributable to the equity holders of the Company. The primary objective of the Company’s capital management is to ensure that it maintains a strong credit rating and healthy capital ratios in order to support its business and maximise shareholder value.
The Company manages its capital structure and makes adjustments to it in light of changes in economic conditions and the requirements of the financial covenants. To maintain or adjust the capital structure, the Company may adjust the dividend payment to shareholders, return capital to shareholders or issue new shares.
No changes were made in the objectives, policies or processes for managing capital during the years ended 31 March 2024 and 31 March 2023
b. Lessor accounting
The Company is a lessor in the operating lease . The subject of these transactions is primarily aircraft leasing and, to a small extent plant and machinery. There is definitive binding agreement between lessor and lessee defining rights and obligation with respect to underlying assets which in substance mitigates the company's risk.
b. No transaction have taken place during the year related to CSR expenditure with the trust/society/section 8 company which is controlled by related party of the company as defined in Ind AS 24 "Related Party Disclosure".
c. The Company has undertaken CSR activities relating to Promoting Education, Rural Development, Livelihood enhancement, Ensuring environmental sustainability, and maintaining quality of water, promoting rural sports, Preventive health care, sanitation and making available safe drinking water.
The company provides share based employee benefits to its employees and the employees of its subsidiaries. The relevant details of the schemes and the grant are as below :
Description of share based payment arrangements
As at 31 March 2024, the Company has the following share based payment arrangements -KOEL ESOP 2019 - Share option plans (equity settled)
According to the Scheme, the employee selected by the Nomination and Remuneration Committee from time to time will be entitled to options, subject to satisfaction of the prescribed vesting conditions. The Option may be exercised within a specified period.
The Employees Stock Option Plan 2019 - (KOEL ESOP 2019) was approved by the shareholders of the Company in AGM conducted on 9 August 2019 for issue of maximum 14,00,000 options representing 14,00,000 Equity shares of H 2 each. Pursuant to the said approvals and authority delegated by the Board and Shareholders of the Company, the Nomination and Remuneration Committee of the Board of Directors of the Company in its meeting held on 5 March 2021 had approved the grant of 9,40,000 employee stock options ("Options") to eligible employees of the Company. Each option shall carry the right to be issued one fully paid up equity share of H2/- each.
The Members of the Company at the Annual General Meeting of Kirloskar Oil Engines Limited held on 12 August 2021, passed a resolution amending the Kirloskar Oil Engines Limited - Employee Stock Option Plan 2019 in terms of coverage of the KOEL ESOP 2019 to the eligible employees of its subsidiary company, in or out of India except such subsidiary company(ies) which are formed and engaged in financial service business.
During the earlier years, the Nomination and Remuneration Committee of the Board of Directors of the Company in its meeting held on 27 October 2021 and 18 May 2022 had approved the grant of 50,000 employee stock options and 275,000 employee stock options to the eligible employees of subsidiary viz. La-Gajjar Machineries Private Limited and to the eligible employees of the Company respectively in terms of 'Kirloskar Oil Engines Limited - Employee Stock Option Plan 2019 - Amended ("KOEL ESOP 2019") and the special resolutions passed by the Members of the Company at the Annual General Meeting held on 9 August 2019 and 12 August 2021.Each option shall carry the right to be issued one fully paid up equity share of H2/- each.
During the year, the Nomination and Remuneration Committee of the Board of Directors of the Company in its meeting held on 10th August 2023 has approved the grant of 1,35,000 employee stock options (“Options”) to the eligible employees of the Company in terms of ‘Kirloskar Oil Engines Limited - Employee Stock Option Plan 2019 (“KOEL ESOP 2019”) and the special resolutions passed by the Members of the Company at the Annual General Meeting held on 9 August 2019 and 12 August 2021.
5.20 Research and Development ("R&D") expenditure eligible for deduction under section 35(2AB) of Income Tax Act, 1961
The Company has adopted a new tax ordinance under section 115BAA during financial year 2019-20. Since provisions of section 115BAA of the Income Tax Act, 1961 are applicable , the Company is not entitled to avail weighted deduction u/s 35(2AB) of the Income Tax Act, 1961 , for Financial Year 2023-24. Thus the Company will not avail weighted deduction benefit on in-house R&D expenditure for financial year 2023-24 . However, the Company will continue to maintain a separate set of books for in-house R & D activities.
5.21 During the previous year 2022-23, the Board of Directors of the Company had given consent to grant unsecured loan to La-Gajjar Machineries Private Limited ("LGM") (a wholly owned subsidiary) and erstwhile Optiqua Pipes and Electricals Private Limited ("OPEPL") (amalgamated with LGM during the current year) of upto H 25 Crores and H 5 crores respectively for a period not exceeding 3 years and 5 years respectively from the date when agreement had been executed at a interest rate of 8.725% p.a. and 10.25% p.a respectively and repayable on mutually agreed upon terms. Accordingly, the total amount of H 21.85 Crores and H 8 Crores loan was disbursed to LGM and OPEPL at interest rate of 8.725% p.a. and 10.25% p.a. respectively. The total loan amount outstanding as at 31 March 2024 is H 10.72 crores (31 March 2023 : H 29.85 crores). Also refer Note 42 for details of amalgamation of LGM and OPEPL.
*KAC includes Engines LPG, LLC dba Wildcat Power Gen (Subsidiary of KAC) w.e.f. 29 November 2023 i.e. on a consolidated basis.
**La-Gajjar Machineries Private Limited, a wholly-owned subsidiary of the Company and Optiqua Pipes and Electricals Private Limited, a step-down subsidiary of the Company has been amalgamated w.e.f. 26 March 2024, pursuant to the Scheme of Amalgamation between Optiqua Pipes and Electricals Private Limited (OPEPL/ Transferor Company) and La-Gajjar Machineries Private Limited, (LGM/ Transferee Company) and their respective shareholders and creditors under Section 233 of the Companies Act 2013 read with Rule 25 of the Companies (Compromises, Arrangements and Amalgamations) Rules, 2016, including amendments thereunder. Accordingly, OPEPL ceased to be a step down subsidiary of the Company. Further ESVA Pumps India Private Limited (ESVA) was the ‘Associate Company' of OPEPL with effect from 4 October 2021 pursuant to Section 2(6) of the Companies Act, 2013 and rules made thereunder, on account of a Joint Venture Arrangement between OPEPL and ESVA. OPEPL was holding 49% stake in ESVA. Pursuant to the aforesaid Scheme, the 49% stake of ESVA is transferred from OPEPL to LGM with effect from 26 March 2024. Accordingly, ESVA is the Associate Company of LGM with effect from 26 March 2024. LGM includes share of profit of ESVA (joint venture of LGM) i.e. on a consolidated basis.
***AFHPL includes "Arka Investment Advisory Services Private Limited" (AIASPL) (wholly owned subsidiary of the AFHPL) and "Arka Fincap Limited" (subsidiary of AFHPL) w.e.f. 4 March 2022 i.e. on a consolidated basis.
43 Disclosure required as per SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 is as follows:
Subsidiary Company
a Kirloskar Americas Corporation (including its subsidiary Engines LPG, LLC dba Wildcat Power Gen)
There are no loans and advances in the nature of loans granted/ advanced by the subsidiary company to firms/companies in which Directors are interested except to the extent disclosed in Note 45 of the Financial Statements.
There are no loans and advances in the nature of loans granted/advanced by the Company to the subsidiary.
b La-Gajjar Machineries Private Limited (including its subsidiary i.e OPEPL upto 25 March 2024 and ESVA joint venture of OPEPL upto 25 March 2024 and of LGM w.e.f. 26 March 2024)
There are no loans and advances in the nature of loans granted/ advanced by the subsidiary company to firms/companies in which Directors are interested.
There are no loans and advances in the nature of loans granted/advanced by the Company to the subsidiary except to the extent disclosed in the Note No. 4 and Note No. 12 of the Financial Statements.
c Arka Financial Holdings Private Limited (including its subsidiary AFL and AIASPL )
There are no loans and advances in the nature of loans granted/ advanced by the subsidiary company to firms/companies in which Directors are interested.
There are no loans and advances in the nature of loans granted/advanced by the Company to the subsidiary.
47 Previous year’s figures have been regrouped wherever considered necessary to make them comparable with those of the current year.
|