o) Provisions
A provision is recognized when the company has a present obligation as a result of 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. Provisions are not discounted to their present value and are determined based on the best estimate required to settle the obligation at the
reporting date. These estimates are reviewed at each reporting date and adjusted to reflect the current best estimates.
Where the company expects some or all of a provision to be reimbursed, for example under an insurance contract, the reimbursement is recognized as a separate asset but only when the reimbursement is virtually certain. The expense relating to any provision is presented in the statement of profit and loss net of any reimbursement.
p) Contingent liabilities
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 recognized because it is not probable that an outflow of resources will be required to settle the obligation. A contingent liability also arises in extremely rare cases where there is a liability that cannot be recognized because it cannot be measured reliably. The Company does not recognize a contingent liability but discloses its existence in the standalone financial statements.
q) Cash and Cash equivalents
Cash and cash equivalents for the purpose of Cash flow statement comprise of cash at bank and in hand and short-term investments with an original maturity of three months or less.
r) Research and Development
Revenue expenditure on research is expensed under respective heads of account in the period in which it is incurred. Capital expenditure is shown as addition to fixed assets.
s) Cash Flow Statement
The Cash Flow Statement is prepared by the indirect method set out in Accounting Standard 3 on Cash Flow Statements and presents the cash flows by operating, investing and financing activities of the Company. Cash and cash equivalents presented in the Cash Flow Statement consist of cash on hand and demand deposits with banks.
2.4 Pursuant to the approval of the shareholders in FY 22-23, the company has made an Initial Public Offer (IPO) of 64,00,000 Equity Shares each of Rs. 75/- having face value of Rs. 10/- per share and share premium of Rs. 65/- per share aggregating to Rs. 4,800 Lakhs. The allotment for the said IPO was made on 04th May, 2022 ranking pari-pasu with the existing shares. The shares of the company were listed on NSE Emerge (SME Platform of National Stock Exchange of India Limited (NSE)) on 09th May, 2022.
2.5 The Board of Directors at its meeting held on 25th May, 2024 had recommended the dividend @ 2% amounting to Rs. 0.20/- per equity share of Rs. 10/- each for the FY 2023-24.
4.1 Unsecured Loans consists of Loan from Related Party as disclosed in Related Party Disclosure.
4.2 Jaguar Car Loan is Loan taken from HDFC Bank secured against Car and Repayable in 60 monthly instalments of Rs. 1.43 Lakhs each (including interest) commencing from Aug 2021 and last instalment due in Jul 2026. The Rate of Interest is 7.20 % p.a.
4.3 Jeep Car Loan is Loan taken from Kotak Mahindra Prime Ltd secured against Car and Repayable in 60 monthly instalments of Rs. 0.56 Lakhs each (including interest) commencing from Oct 2021 and last Instalment due in Sept 2026. The Rate of Interest is 7.43 % p.a.
4.4 Tata Harrier Car Loan A is Loan taken from Kotak Mahindra Prime Ltd secured against Car and Repayable in 60 monthly instalments of Rs. 0.46 Lakhs each (including interest) commencing from Nov 2021 and last Instalment due in Oct 2026. The Rate of Interest is 7.93 % p.a.
4.5 Tata Harrier Car Loan B is Loan taken from HDFC Bank secured against Car and Repayable in 84 monthly instalments of Rs. 0.35 Lakhs each (including interest) commencing from Sept 2020 and last Instalment due in Aug 2027. The Rate of Interest is 8.00 % p.a.
6.1 Working Capital facility from Shinhan Bank is primarily secured against paripasu charge by way of Hypothecation on the entire inventory, receivables, bills and other chargeable current assets of the company (both present and future) to the extent of 23.16% of share and the collateral security as Equitable Mortgage by deposit of title deeds on premises of the Company situated in B1104D, Boomerang Building, Mumbai, Two Residential Flats in name of Directors situated in Powai, liquid collateral in form of Fixed Deposits of Rs. 2.25 Crs and the personal guarantee of Mr. Abhishek Lath, Mrs Sweta Lath, Mr. Umashankar Lath and Mrs Asha Devi Lath. The Rate of Interest chargeable by the Bank is 9 % p.a. (less Interest Equalization scheme benefit)"
6.2 Working Capital facility from ICICI Bank is primarily secured against paripasu charge by way of Hypothecation on the entire stock of Raw Material, Semi finished and finished goods, consumable stores and spares and such other movables including book debts, bills whether documentary or clean, outstanding monies, receivables both present and future in a form or manner satisfactory to bank to the extent of 25.04% of share and the collateral security as Equitable Mortgage on four properties in name of Directors and one property in name of company, consisting of Residential Property in Burhanpur, Vacant Land in Burhanpur, Commercial Property in Mumbai, and the unconditional personal guarantee of Mr. Abhishek Lath, Mr. Umashankar Lath and Mrs Asha Devi Lath. The Rate of Interest chargeable by the Bank is Repo Rate 2.75% p.a. (less Interest Equalization scheme benefits)."
6.3 Working Capital facility from UCO Bank is primarily secured against paripasu charge by way of Hypothecation on the entire stock of inventory, receivables, semi-finished and finished goods, consumable stores and spares and such other movables including book debts, bills and other current
asset of the company created through Bank finance both present and future to the extent of 25.90% of share and the collateral security as 50% liquid collateral security in form of FDR of Rs 7.50 Cr. duly charged in favour of Bank and the unconditional personal guarantee of Mr. Abhishek Lath, Mr. Umashankar Lath and Mrs Asha Devi Lath. The Rate of Interest chargeable by the Bank is Pre Shipment: MCLR 6 Months (1.00% to 1.25%) Post Shipment: Overnight MCLR (1.05% to 1.45%) depending on the tenure.
6.4 Working Capital facility from HDFC is primarily secured against paripasu charge by way of Hypothecation on the entire stock of inventory, receivables, semi-finished and finished goods, consumable stores and spares and such other movables including book debts, bills and other current asset of the company created through Bank finance both present and future to the extent of 25.90% of share and the collateral security as FDR of Rs. 4.50 Crs duly charged in favour of Bank and the unconditional personal guarantee of Mr. Abhishek Lath, Mr. Umashankar Lath, Mrs. Sweta Lath and Mrs. Asha Devi Lath. The Rate of Interest chargeable by the Bank is 3 M T bill Spread 1.83% - Constant."
Note 32.1: CSR obligation for the Financial Year 2023-24 was Rs. 30,43,402/- out of which Rs. 3,48,000/- was fulfilled during the year the balance of Rs. 26,95,402/- is to be fulfilled on ongoing projects in next three years as the remaining amount was transferred to Unspent CSR Account with ICICI Bank on 29-04-2024 in Compliance with Section 135(7) of the Companies Act, 2013.
Note 32.2: CSR obligation for the Financial Year 2022-23 was Rs. 27,76,910/- out of which Rs. 10,49,000/-was fulfilled during the year plus Rs.9,430/- Surplus of FY 2021-22 and the balance of Rs. 17,18,480/- is to be fulfilled on ongoing projects in next three years as the remaining amount was transferred to Unspent CSR Account with UCO Bank on 28-04-2023 in Compliance with Section 135(7) of the Companies Act, 2013. and out of this 17,18,480/- Rs. 12,34,800/- has been fulfilled during the year and the balance of Rs. 4,83,680/-shall be fulfilled in coming years (within 3 years).
The Company has been sanctioned working capital limits from Shinhan Bank, ICICI Bank, HDFC Bank and UCO Bank on the basis of security of current assets and Monthly statements to be filled, There are no variances in Security of current assets as per Books of Accounts and the Monthly Statements filled to the Bank.
Note 35: Employee Benefits
As required under Accounting Standard 15 (Revised 2005), Actuarial Gains and Losses is recognized immediately in the Statement of Profit and Loss.
Note 36: Un-hedged Foreign Currency Exposure
Particulars of Un-hedged Foreign Currency Exposure as at Balance sheet date is Rs. 8.50 Crs as on 31st March, 2024 and Rs. 5.00 Crs as on 31st March, 2023 as per management.
Note 37: Micro and Small Enterprises
Under the Micro, Small and Medium Enterprises Development Act, 2006 (MSMED) certain disclosures are required to be made relating to Micro, Small and Medium Enterprises. The Company has not received any information from the "suppliers" regarding their status under the Micro Small and Medium Enterprises Development Act, 2006.
The Company is primarily in the business of manufacturing, purchase and sale of textiles. The Management of the Company evaluates the Company's performance, allocate resources based on the analysis of the various performance indicator of the Company as a single unit.
Therefore, there is only one reportable segment for the Company ie. Textile Business
Note 42: Other Regulatory Disclosures
a) The Company has not traded in crypto currency or virtual currency during the year.
b) The Company is not declared a willful defaulter by any bank or financial institution or other lenders.
c) The Company has no transactions with the struck off Companies under Section 248 or 560 of the Act.
d) No proceedings were initiated or pending against the Company for holding any benami property under the Benami Transactions (Prohibition) Act, 1988.
e) There are no ultimate beneficiaries to whom the Company has lent/invested nor received any fund during the year within the meaning of Foreign Exchange Management Act 1999 and Prevention of money Laundering Act 2002.
f) The Company has complied related to number of layers prescribed under clause (87) of section 2 of the Companies Act read with the Companies (Restriction on number of Layers) Rules, 2017.
g) There we no transaction in the Company 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.
h) The Company does not have any charges or satisfaction, which is yet to be registered with Registrar of Companies beyond the statutory period.
i) 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 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 (Ultimate Beneficiaries) or provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries.
j) The details pursuant to provisions of schedule III to the Companies Act, 2013 have been given to the extent applicable to the company
Note 43: Previous year's figures have been regrouped/ reclassified, wherever necessary to conform to this years' classification
As per our report of even date For and on behalf of Board of Directors
of Le Merite Exports Limited
For Nagori Nuwal & Co
Chartered Accountant
(FRN 08185C)
Abhishek Lath Umashankar Lath
MD & CFO Chairman & MD
(DIN - 00331675) (DIN - 05135035)
CA Shankar Lal Laddha
Partner
(Membership No 76554) Sandeep Poddar
UDIN: 24076554BKLBBV4771 Company Secretary
Place: Mumbai (M. No.: A69365)
Date: 25th May, 2024
|