m. Provisions, contingent liabilities and contingent assets
Provisions are recognised when present obligations as a result of a past event will probably lead to
an outflow of economic resources and amounts can be estimated reliably. Timing or amount of the
outflow may still be uncertain. A present obligation arises when there is a presence of a legal or
constructive commitment that has resulted from past events, for example, legal disputes or
onerous contracts. Provisions are not recognised for future operating losses.
Provisions are measured at the estimated expenditure required to settle the present obligation,
based on the most reliable evidence available at the reporting date, including the risks and
uncertainties associated with the present obligation. Provisions are discounted to their present
values, where the time value of money is material.
Any reimbursement that the Company can be virtually certain to collect from a third party with
respect to the obligation is recognised as a separate asset. However, this asset may not exceed the
amount of the related provision.
All provisions are reviewed at each reporting date and adjusted to reflect the current best estimate.
In those cases where the outflow of economic resources as a result of present obligations is
considered improbable or remote, no liability is recognised.
Contingent liability is disclosed for:
• Possible obligations which will be confirmed only by future events not wholly within the
control of the Company or
• Present obligations arising from past events where it is not probable that an outflow of
resources will be required to settle the obligation or a reliable estimate of the amount of the
obligation cannot be made.
Contingent assets are not recognised. However, when inflow of economic benefits is probable,
related asset is disclosed.
n. Employee benefits
Expenses and liabilities in respect of employee benefits are recorded in accordance with
Indian Accounting Standard 19- Employee Benefits.
Defined benefit plans Gratuity
The Company operates one defined benefit plan for its employees, viz. gratuity. The cost of
providing benefits under this plan is determined on the basis of actuarial valuation at each year-
end using the projected unit credit method. Actuarial gain and loss for the defined benefit plan is
recognized in full in the period in which they occur in other comprehensive income.
Other long-term benefits
Accumulated leave expected to be carried forward beyond twelve months, is treated as long term
employee benefit. Such long term compensated absences are provided for based on the actuarial
valuation using the projected unit credit method at the year end. Accumulated leave, which is
expected to be utilised within the next 12 months, is treated as short term employee benefit.
Liability under continuity linked key resource and deferred salary schemes is provided for on
actuarial valuation basis, which is done as per the projected unit credit method at the end of each
financial period.
Defined contribution plans Provident Fund
The Company makes contribution to statutory provident fund in accordance with Employees
Provident Fund and Miscellaneous Provisions Act, 1952. The plan is a defined contribution plan and
contribution paid or payable is recognised as an expense in the period in which services are
rendered by the employee.
Short-term employee benefits
Expense in respect of other short-term benefits is recognised on the basis of the amount paid or
payable for the period during which services are rendered by the employee.
o. Earnings per share
Basic earnings per share is calculated by dividing the net profit or loss for the period attributable to
equity shareholders (after deducting attributable taxes) by the weighted average number of equity
shares outstanding during the period. The weighted average number of equity shares outstanding
during the period is adjusted for events including a bonus issue.
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 period are adjusted for the effects of all dilutive potential equity shares.
p. Segment reporting
Operating segments are reported in a manner consistent with the internal reporting done to the
chief operating decision maker. The chief operating decision maker is responsible for allocating
resources and assessing performance of the operating segments of the Company.
3. Significant accounting judgments, estimates and assumptions
When preparing the financial statements, management undertakes a number of judgments,
estimates and assumptions about recognition and measurement of assets, liabilities, income and
expenses.
The actual results are likely to differ from the judgments, estimates and assumptions made by
management, and will seldom equal the estimated results.
Information about significant judgments, estimates and assumptions that have the most significant
effect on recognition and measurement of assets, liabilities, income and expenses are discussed
below:
Significant judgments:
(i) Evaluation of indicators for impairment of non-financial assets
The evaluation of applicability of indicators of impairment of non-financial assets requires
assessment of several external and internal factors which could result in deterioration of
recoverable amount of the assets.
(ii) Recognition of deferred tax assets
The extent to which deferred tax assets can be recognised is based on an assessment of the
probability of the future taxable income against which the deferred tax assets can be utilised. The
recognition of deferred tax assets and reversal thereof is also dependent upon management
decision relating to timing of Availment of tax holiday benefits available under the Income Tax Act,
1961 which in turn is based on estimates of future taxable profits.
Sources of estimation uncertainty:
(i) Provisions
At each balance sheet date, basis the management judgment, changes in facts and legal aspects,
the Company assesses the requirement of provisions against the outstanding warranties and
guarantees. However, the actual future outcome may be different from management's estimates.
(ii) Fair valuation of financial instruments
Management applies valuation techniques to determine the fair value of financial instruments
(where active market quotes are not available). This involves developing estimates and
assumptions consistent with how market participants would price the instrument.
IV. Rights, preferences and restrictions attached to equity shares
The Company has one class of equity shares with paid up value of Rs.10 per share. Each holder of
equity shares is entitled to one vote per share on all resolutions submitted to shareholders. They
have right to participate in the profits of the company, if declared by the Board as interim dividend
and recommended by the Board and declared by the members as final dividend. They are also
entitled to bonus/right issue, as declared by Company from time to time. They have right to receive
annual report of the Company, beside other rights available under the Companies Act and Listing
Regulations.
In the event of liquidation of the company, the holders of equity shares will be entitled to receive
remaining assets of the Company, beside other rights available under the Companies Act.
The distribution will be in proportion to the number of equity shares held by the shareholders.
V. Aggregate number and class of shares allotted as fully paid up pursuant to contract(s) without
payment being received in cash, by way of bonus shares and shares bought back for the period of 5
years immediately preceding the balance sheet date
Additional Disclosures:
i. Nature of Dilutive Instruments:
As on the reporting date, the Company had 35,00,000 outstanding share warrants, which are
considered potential equity shares. The impact of these warrants has been considered for the
purpose of diluted earnings per share using the Treasury Stock Method
ii. Compliance:
The calculation of EPS has been made in accordance with Paragraphs 10-49 of Ind AS 33, and the
presentation aligns with the requirements of Division II of Schedule III to the Companies Act, 2013 for
companies following Ind AS.
37. Related party disclosures
The nature of relationship and summary of transactions with related parties are summarised below:
a) Name of the related party and nature of their relationship
39. Lease related disclosures
The Company has lease for office building and factory lease hold land. With the exception of short-term
leases and leases of low-value underlying assets, each lease is reflected on the balance sheet as a right-
of-use asset and a lease liability as a borrowings. Variable lease payments which do not depend on an
index or a rate are excluded from the initial measurement of the lease liability and right of use assets.
The Company classifies its right-of-use assets in a consistent manner to its property, plant and
equipment.
For leases previously classified as finance leases the entity recognised the carrying amount of the lease
asset and lease liability immediately before transition as the carrying amount of the right of use asset
and the lease liability at the date of initial application. The measurement principles of Ind-AS 116 are only
applied after that date.
Each lease generally imposes a restriction that, unless there is a contractual right for the Company to
sublease the asset to another party, the right-of-use asset can only be used by the Company. Some
leases contain an option to extend the lease for a further term. The Company is prohibited from selling or
pledging the underlying leased assets as security. For leases over office building the Company must keep
those properties in a good state of repair and return the properties in their original condition at the end of
the lease.
Financial assets and financial liabilities measured at fair value in the statement of financial position
are classified into three Levels of a fair value hierarchy. The three levels are defined based on the
observability of significant inputs to the measurement, as follows:
• Level 1: Quoted prices (unadjusted) in active markets for financial instruments.
• Level 2: The fair value of financial instruments that are not traded in an active market is
determined using valuation techniques which maximise the use of observable market data rely
as little as possible on entity specific estimates.
• Level 3: If one or more of the significant inputs is not based on observable market data, the
instrument is included in level 3.
40. (B) Financial Risk Management
The Company's activities expose it to market risk, liquidity risk and credit risk. The Company's board
of directors has overall responsibility for the establishment and oversight of the Company's risk
management framework. This note explains the sources of risk which the entity is exposed to and
how the entity manages the risk and the related impact in the financial statements.
A. Credit risk:
'Credit risk is the risk that a counterparty fails to discharge an obligation to the company. The
company is exposed to this risk for various financial instruments, for example by granting loans
and receivables to customers, placing deposits, etc. The company's maximum exposure to credit
risk is limited to the carrying amount of following types of financial assets.
- cash and cash equivalents,
- trade receivables,
- loans & receivables carried at amortised cost, and
- deposits with banks
Credit risk management:
Credit risk rating -
The Company assesses and manages credit risk based on internal credit rating system,
continuously monitoring defaults of customers and other counterparties, identified either
individually or by the company, and incorporates this information into its credit risk controls.
Internal credit rating is performed for each class of financial instruments with different
characteristics. The Company assigns the following credit ratings to each class of financial assets
based on the assumptions, inputs and factors specific to the class of financial assets.
A: Low
B: Medium
C: High
Assets under credit risk -
Cash & cash equivalents and bank deposits
Credit risk related to cash and cash equivalents and bank deposits is managed by only accepting highly
rated banks and diversifying bank deposits and accounts in different banks.
Trade receivables:
Company's trade receivables are considered of high quality and accordingly no life time expected credit
losses are recognised on such receivables.
Other financial assets measured at amortised cost
Other financial assets measured at amortized cost includes advances to employees. Credit risk related to
these other financial assets is managed by monitoring the recoverability of such amounts continuously,
while at the same time internal control system in place ensure the amounts are within defined limits.
B. Liquidity Risk:
Prudent liquidity risk management implies maintaining sufficient cash and marketable securities
and the availability of funding through an adequate amount of committed credit facilities to meet
obligations when due. Due to the nature of the business, the Company maintains flexibility in
funding by maintaining availability under committed facilities.
Management monitors rolling forecasts of the Company's liquidity position and cash and cash
equivalents on the basis of expected cash flows. The Company takes into account the liquidity of
the market in which the entity operates. In addition, the Company's liquidity management policy
involves projecting cash flows in major currencies and considering the level of liquid assets
necessary to meet these, monitoring balance sheet liquidity ratios against internal and external
regulatory requirements and maintaining debt financing plans.
Maturities of financial liabilities
The amounts disclosed in the table are the contractual undiscounted cash flows. Balances due within 12
months equal their carrying balances as the impact of discounting is not significant.
C. Market Risk:a. Interest rate risk
The Company's exposure to the risk of changes in market interest rates relates primarily to long term
debt. Total Borrowings are floating rate of interest and hence, interest risk sensitivity has been
prepared in regard to these borrowings with all other variables held constant, the following table
demonstrates the sensitivity to a reasonably possible change in interest rates on floating rate portion of
loans and borrowings after considering the impact of interest rate swaps. The below sensitivity analysis
is based on movement in interest rates by 50 basis points.
Weighted average cost of borrowing is 7.67% for the year ended 31st March, 2026 (8.53% for the year
ended 31st March, 2025) excluding borrowings which are assigned/negotiated with banks with no
interest liability.
b. Price risk
Exposure:
The Company's exposure to price risk arises from investments held and classified as FVTPL. To manage
the price risk arising from investments in mutual funds and equity investment, the Company diversifies
its portfolio of assets.
Sensitivity:
Below is the sensitivity of profit or loss and equity to changes in fair value of investments, assuming no
change in other variables:
c. Foreign exchange risk and sensitivity
The Company transacts business primarily in Indian Rupee. However, the Company has transactions in
USD. The Company has foreign currency trade payables.
The following table demonstrates the sensitivity in the USD to the Indian Rupee with all other variables
held constant. The impact on the Company's profit before tax and other comprehensive income due to
changes in the fair value of monetary assets and liabilities is given below.
The assumed movement in exchange rate sensitivity analysis is based on the currently observable
market environment.
41. Segment Information:
The Company's primary business segment is reflected based on principal business activities carried
on by the Company i.e. Caustic soda and other chemicals, which as per Ind AS 108 on “Segment
Reporting” as specified under Section 133 of Companies Act, 2013, read with Rule 7 of the Companies
(Accounts) Rules, 2014 (as amended) is considered to be the only operating segment. The Company is
primarily operating in India which is considered as a single geographical segment.
42. Details of assets pledged/ hypothecated as security:
The carrying amounts of assets pledged/ hypothecated as security for current and non-current
borrowings are:
Note: 1. Pending resolution of the respective proceeding, it is not practicable for the Company to estimate
the timings of cash outflows, if any, in respect of the above as it is determinable only on receipt of judgement/
decisions pending with various forums/ authorities.
B. Commitments (net of advance):
Estimated amount of contracts remaining to be executed on capital account Rs. 4474.92 Lakh, (Previous
year: 31 March 2025: Rs. 912.69 Lakh).
44. Unclaimed amount in respect of debentures and excess share application money refundable Rs. 11.64
lakhs, (Previous year: 31 March 2025: 11.64 lakhs) is required to be transferred to the “Investor education
and protection fund” in terms of section 125 of the companies act, 2013. the company is taking steps to
reconcile the above accounts and deposit the amount with the appropriate authorities.
45. Authorisation of financial statements
These financial statements for the year ended 31 March 2026 were approved by the Board of Directors on
28th May 2026.
46. The figures have been rounded off to the nearest Rs. lakhs up to two decimals.
47. Derivative instruments and unhedged foreign currency exposure
The Company has no outstanding derivative instrument at the year-end. The amount of foreign currency
exposure that are not hedged by derivative instruments or otherwise are as under:
49. Additional Regulatory Information:
i. Company has no freehold immovable property during the year.
ii. The Company has not revalued its Property, Plant and Equipments during the year.
iii. The company has not made any loan or advances in the nature of loans to promoters, directors,
KMPs, and the related parties.
iv. The company do not own or hold any Benami Property under the Benami Transactions
(Prohibition) Act, 1988(45of 1988) and the rules made there under.
v. The statements of current assets filed by the company with banks are in agreement with the
books of accounts.
vi. The company is not declared a Willful Defaulter by any bank or financial institutions.
vii. The company do not have any transactions with companies stuck off under section 248 of the
companies Act, 2013 or section 560 of companies Act,1956.
viii. All Registration of charges or satisfaction are registered with Registrar of Companies (ROC).
ix. No Scheme(s) of Arrangements has been approved by the competent authority in terms of
section 230 to 237 of the companies Act, 2013.
x. The company has utilised long term borrowed fund for long term purpose only and short term
fund for short term purpose only.
xi. During the year no income was surrendered or disclosed as income in the Tax Assessments
xii. The company has not dealt in Crypto Currency during the year.
xiii. The company is not having downstream companies or layers of companies prescribed under
clause (87) of section 2 of the Act read with companies (Restriction on number of layers) Rules,
2017.
xiv. The Company has not advanced or loaned or invested funds to any other person or entities with
an understanding that the intermediary will invest or provide any guarantee, security or the like
to or on behalf of ultimate beneficiaries.
xv. The Company has not received any fund from any person (s) or entity(s), including foreign
entities( Funding party) with the understanding that the company shall directly or indirectly invest
or provide any guarantee, security or the like to or on behalf of funding party.
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