g) Provisions
Provisions are recognised when the company has
a present obligation (legal or constructive) 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. When the Group expects some or all of
a provision to be reimbursed, for example, under
an insurance contract, the reimbursement is
recognised as a separate asset, but only when the
reimbursement is virtually certain. The expense
relating to a provision is presented in the statement
of profit and loss net of any reimbursement.
If the effect of the time value of money is material,
provisions are discounted using a current pre¬
tax rate that reflects, when appropriate, the risks
specific to the liability. When discounting is used,
the increase in the provision due to the passage of
time is recognised as a finance cost.
h) Employee benefits
Short term employee benefits and defined
contribution plans:
All employee benefits payable/available within
twelve months of rendering the service are
classified as short-term employee benefits.
Benefits such as salaries, wages and bonus etc.
are recognised in the statement of profit and loss
in the period in which the employee renders the
related service.
Employee benefit in the form of provident fund is
a defined contribution scheme. The Company has
no obligation, other than the contribution payable
to the provident fund. The Company recognizes
contribution payable to the provident fund scheme
as an expense, when an employee renders the
related service. If the contribution payable to the
scheme for service received before the balance
sheet date exceeds the contribution already paid,
the deficit payable to the scheme is recognized as
a liability after deducting the contribution already
paid. If the contribution already paid exceeds the
contribution due for services received before the
balance sheet date, then excess is recognized as
an asset to the extent that the pre-payment will
lead to, for example, a reduction in future payment
or a cash refund.
Gratuity
Gratuity is a defined benefit scheme. The defined
benefit obligation is Computed by actuaries using
the projected unit credit method.
Re-measurements, comprising of actuarial gains
and losses, are recognized immediately in the
balance sheet with a corresponding debit or credit
to retained earnings through OCI in the period
in which they occur. Re-measurements are not
reclassified to profit or loss in subsequent periods.
Past service costs are recognised in profit or loss
on the earlier of:
• The date of the plan amendment or
curtailment, and
• The date that the Company recognises
related restructuring cost
Interest is calculated by applying the discount rate
to the net defined benefit liability.
The Company recognises the following changes in
the net defined benefit obligation as an expense in
the Statement of profit and loss:
• Service costs comprising current service
costs, past-service costs, gains and
losses on curtailments and non-routine
settlements; and
• Interest expense
Termination benefits
Termination benefits are payable when
employment is terminated by the Company before
the normal retirement date. The Group recognises
termination benefits at the earlier of the following
dates: (a) when the group can no longer withdraw
the offer of those benefits; and (b) when the Group
recognises costs for a restructuring that is within
the scope of Ind AS 37 and involves the payment of
terminations benefits. Benefits falling due more
than 12 months after the end of the reporting
period are discounted to present value.
Compensated Absences
Accumulated leave, which is expected to be
utilized within the next 12 months, is treated
as short term employee benefit. The Company
measures the expected cost of such absences
as the additional amount that it expects to pay
as a result of the unused entitlement that has
accumulated at the reporting date.
The company treats leaves expected to be carried
forward for measurement purposes. Such
compensated absences are provided for based
on the actuarial valuation using the projected unit
credit method at the year-end. Actuarial gains/
losses are immediately taken to the statement of
profit and loss and are not deferred. The company
presents the entire leave as a current liability
in the balance sheet, since it does not have an
unconditional right to defer its settlement for 12
months after the reporting date. Where Company
has the unconditional legal and contractual
right to defer the settlement for a period beyond
12 months, the same is presented as non¬
current liability.
i) Impairment of non-financial assets
For assets with definite useful life, the Company
assesses, at each reporting date, whether
there is an indication that an asset may be
impaired. If any indication exists, or when annual
impairment testing for an asset is required, the
Company estimates the asset's recoverable
amount. An asset's recoverable amount is the
higher of an asset's or cash-generating unit's
(CGU) fair value less costs of disposal and its
value in use. Recoverable amount is determined
for an individual asset, unless the asset does
not generate cash inflows that are largely
independent of those from other assets or groups
of assets. When 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.
In assessing value in use, the estimated future
cash flows are discounted to their present value
using a pre-tax discount rate that reflects current
market assessments of the time value of money
and the risks specific to the asset. In determining
fair value less costs of disposal, recent market
transactions are taken into account. If no such
transactions can be identified, an appropriate
valuation model is used. These calculations are
corroborated by valuation multiples, quoted share
prices for publicly traded Company's or other
available fair value indicators.
The Company bases its impairment calculation on
detailed budgets and forecast calculations, which
are prepared separately for each of the Company's
CGUs to which the individual assets are allocated.
These budgets and forecast calculations generally
cover a period of five years. For longer periods, a
long-term growth rate is calculated and applied
to project future cash flows after the fifth year.
To estimate cash flow projections beyond periods
covered by the most recent budgets/forecasts, the
Company extrapolates cash flow projections in
the budget using a steady or declining growth rate
for subsequent years, unless an increasing rate
can be justified. In any case, this growth rate does
not exceed the long-term average growth rate for
the products, industries, or country or countries
in which the entity operates, or for the market in
which the asset is used.
Impairment losses of continuing operations,
including impairment on inventories, are
recognised in the statement of profit and loss.
An assessment is made at each reporting date
to determine whether there is an indication that
previously recognised impairment losses no
longer exist or have decreased. If such indication
exists, the Company estimates the asset's
or CGU's recoverable amount. A previously
recognised impairment toss is reversed only if
there has been a change in the assumptions used
to determine the asset's recoverable amount
since the last impairment loss was recognised.
The reversal is limited so that the carrying amount
of the asset does not exceed its recoverable
amount, nor exceed the carrying amount that
would have been determined, net of depreciation,
had no impairment loss been recognised for the
asset in prior years. Such reversal is recognised
in the statement of profit or loss unless the asset
is carried at a revalued amount, in which case, the
reversal is treated as a revaluation increase.
Intangible assets with indefinite useful lives are
tested for impairment annually at the CGU level,
as appropriate, and when circumstances indicate
that the carrying value may be impaired.
j) Financial Instruments
A financial instrument is any contract that gives
rise to a financial asset of one entity and a financial
liability or equity instrument of another entity.
Financial assets
Initial recognition and measurement
All financial assets (other than trade receivables
which is recognized at transaction price as per
IND AS 115) are recognized initially at fair value
plus, in the case of financial assets not recorded
at fair value through profit or loss, transaction
costs that are attributable to the acquisition of the
financial asset.
Subsequent measurement
For purposes of subsequent measurement, Debt
instruments are measured at amortized cost.
Debt instruments at amortised cost
A debt instrument' is measured at the amortized
cost if both the following conditions are met:
• The asset is held within a business model
whose objective is to hold assets for
collecting contractual cash flows, and
• Contractual terms of the asset give rise on
specified dates to cash flows that are solely
payments of principal and interest (SPPI) on
the principal amount outstanding.
After initial measurement, such financial assets
are subsequently measured at amortized using
the effective interest rate (EIR) method. Amortized
cost is calculated by taking into account any
discount or premium on acquisition and fees or
costs that are an integral part of the EIR. The EIR
amortisation is included in finance income in the
profit or loss. The losses arising from impairment
are recognised in the profit or loss. This category
generally applies to trade and other receivables.
Equity investments
All equity investments in scope of Ind-AS 109 are
measured at fair value. Equity instruments which
are held for trading and contingent consideration
recognised by an acquirer in a business
combination to which Ind-AS 103 applies are
Ind-AS classified as at FVTPL. For all other equity
instruments, the Group may make an irrevocable
election to present in other comprehensive
income subsequent changes in the fair value. The
Group makes such election on an instrument-by¬
instrument basis. The classification is made on
initial recognition and is irrevocable.
If the group decides to classify an equity
instrument as at FVTOCI, then all fair value
changes on the instrument, excluding dividends,
are recognized in the OCI. There is no recycling
of the amounts from OCI to P&L, even on sale of
investment. However, the Group may transfer the
cumulative gain or loss within equity.
Equity instruments included within the FVTPL
category are measured at fair value with all
changes recognized in the P&L.
Derecognition
A financial asset (or, where applicable, a part of
a financial asset or part of a Company of similar
financial assets) is primarily derecognized (i.e.
removed from the Company's consolidated
balance sheet) when:
• The rights to receive cash flows from the
asset have expired, or
• The Company has transferred its rights to
receive cash flows from the asset or has
assumed an obligation to pay the received
cash flows in full without material delay
to a third party under a pass-through'
arrangements and either (a) the Company
has transferred substantially all the
risks and rewards of the asset, or (b) the
Company has neither transferred nor
retained substantially all the risks and
rewards of the asset, but has transferred
control of the asset.
When the Company has transferred its rights to
receive cash flows from an asset or has entered
into a pass-through arrangement, it evaluates
if and to what extent it has retained the risks
and rewards of ownership. When it has neither
transferred nor retained substantially all of the
risks and rewards of the asset, nor transferred
control of the asset, the Company continues to
recognize the transferred asset to the extent
of the Company's continuing involvement. In
that case, the Company also recognizes an
associated liability. The transferred asset and
the associated liability are measured on a basis
that reflects the rights and obligations that the
Company has retained.
Continuing involvement that takes the form of a
guarantee over the transferred asset is measured
at the lower of the original carrying amount of the
asset and the maximum amount of consideration
that the Company could be required to repay.
Impairment of financial assets
In accordance with Ind-AS 109, the Company
applies expected credit loss (ECL) model for
measurement and recognition of impairment
loss on the following financial assets and
credit risk exposure:
a) Financial assets that are debt instruments,
and are measured at amortized cost e.g.,
loans, debt securities, deposits, trade
receivables and bank balance
b) Trade receivables or any contractual right
to receive cash or another financial asset
that result from transactions that are within
the scope of Ind-AS 115 (referred to as
contractual revenue receivables' in these
financial statements)
The Company follows simplified approach' for
recognition of impairment loss allowance on
trade receivables or contract revenue receivables
or unbilled receivables.
The application of simplified approach does
not require the Company 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.
For recognition of impairment loss on other
financial assets and risk exposure, the Company
determines that whether there has been a
significant increase in the credit risk since initial
recognition. If credit risk has not increased
significantly, 12-month ECL is used to provide
for impairment loss. However, if credit risk has
increased significantly, lifetime ECL is used. If, in a
subsequent period, credit quality of the instrument
improves such that there is no longer a significant
increase in credit risk since initial recognition,
then the entity reverts to recognising impairment
loss allowance based on 12-month ECL.
Lifetime ECL are the expected credit losses
resulting from all possible default events over
the expected life of a financial instrument. The
12-month ECL is a portion of the lifetime ECL
which results from default events that are possible
within 12 months after the reporting date.
As a practical expedient, the Company uses a
provision matrix to determine impairment loss
allowance on portfolio of its trade receivables.
The provision matrix is based on its historically
observed default rates over the expected life
of the trade receivables and is adjusted for
forward-looking estimates. At every reporting
date, the historical observed default rates are
updated and changes in the forward-looking
estimates are analysed.
ECL impairment loss allowance (or reversal)
recognized during the period is recognized as
income/ expense in the Statement of Profit and
Loss. This amount is reflected under the head
other expenses' in the Statement of Profit and
Loss. The balance sheet presentation for various
financial instruments is described below:
• Financial assets measured as at amortized
cost, contractual revenue receivables and
lease receivables: ECL is presented as
an allowance, i.e., as an integral part of
the measurement of those assets in the
balance sheet. The allowance reduces
the net carrying amount. Until the asset
meets write-off criteria, the Company does
not reduce impairment allowance from
the gross carrying amount. For assessing
increase in credit risk and impairment
loss. The Company combines financial
instruments on the basis of shared credit
risk characteristics with the objective of
facilitating an analysis that is designed to
enable significant increases in credit risk to
be identified on a timely basis.
The Company does not have any purchased or
originated credit-impaired (POCI) financial assets,
i.e., financial assets which are credit impaired on
purchase/ origination.
Financial liabilities
Initial recognition and measurement
Financial liabilities are classified, at initial
recognition, as financial liabilities at fair value
through profit or loss, loans and borrowings,
payables, or as derivatives designated as hedging
instruments in an effective hedge, as appropriate.
All financial liabilities are recognised initially at
fair value and, in the case of loans and borrowings
and payables, net of directly attributable
transaction cos
The Company's financial liabilities include trade
and other payables, loans and borrowings.
Subsequent measurement
Loans and borrowings
After initial recognition, interest-bearing loans
and borrowings are subsequently measured at
amortized cost using the ElR method. Gains and
losses are recognised in profit and loss when the
liabilities are derecognised as well as through the
EIR amortisation process.
Amortized cost is calculated by taking into account
any discount or premium on acquisition and fees
or costs that are an integral part of the EIR. The
ElR amortization is included as finance costs in
the Statement of Profit and Loss. This category
generally applies to borrowings.
De-recognition
A financial liability is derecognised when the
obligation under the liability is discharged or
cancelled or expires. When an existing financial
liability is replaced by another from the same
lender on substantially different terms, or the
terms of an existing liability are substantially
modified, such an exchange or modification is
treated as the de-recognition of the original
liability and the recognition of a new liability. The
difference in the respective carrying amounts is
recognised in the Statement of Profit and Loss.
Financial guarantee contracts
Financial guarantee contracts are recognised
as a financial liability at the time the guarantee
is issued. The liability is initially measured at
fair value and subsequently at the higher of
(i) the amount determined in accordance with
the expected credit loss model as per Ind AS
109 and (ii) the amount initially recognised
less, where appropriate, cumulative amount
of income recognised in accordance with the
principles of Ind AS 115.
The fair value of financial guarantees is
determined based on the present value of the
difference in cash flows between the contractual
payments required under the debt instrument
and the payments that would be required without
the guarantee, or the estimated amount that
would be payable to a third party for assuming
the obligations.
Where guarantees in relation to loans or other
payables of subsidiaries are provided for no
compensation, the fair values are accounted for
as contributions and recognised as part of the
cost of the investment.
Offsetting of financial instruments
Financial assets and financial liabilities are offset
and the net amount is reported in the balance
sheet if there is a currently enforceable legal right
to offset the recognised amounts and there is an
intention to settle on a net basis, to realise the
assets and settle the liabilities simultaneously.
k) Cash and cash equivalents
Cash and cash equivalent in the balance sheet
comprise cash at banks and on hand and short¬
term deposits with an original maturity of
three months or less, which are subject to an
insignificant risk of changes in value.
For the purpose of the statement of cash flows,
cash and cash equivalent consists of cash
and short-term deposits, as defined above,
net of outstanding bank overdrafts as they are
considered an integral part of the Company's
cash management. Cash flows from operating
activities are being prepared as per the Indirect
method mentioned in Ind AS 7.
l) 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 financial statements. Contingent
assets are only disclosed when it is probable that
the economic benefits will flow to the entity.
m) Measurement of EBITDA
The Company has elected to present earnings
before finance cost, tax, depreciation and
amortization (EBITDA) as a separate line item
on the face of the statement of profit and loss.
The Company measures EBITDA on the face of
profit/ (loss) from continuing operations. In the
measurement, the Company does not include
depreciation and amortization expense, finance
costs and tax expense.
n) Investment in subsidiary
An investor, regardless of the nature of its
involvement with an entity (the investee), shall
determine whether it is a parent by assessing
whether it controls the investee.
An investor controls an investee when it is
exposed, or has rights, to variable returns from
its involvement with the investee and has the
ability to affect those returns through its power
over the investee.
Thus, an investor controls an investee if and only if
the investor has all the following:
(a) power over the investee;
(b) exposure, or rights, to variable returns from
its involvement with the investee and
(c) the ability to use its power over the investee
to affect the amount of the investor's returns.
The Company has elected to recognize its
investments in subsidiary companies at cost
in accordance with the option available in
Ind-AS 27, Separate Financial Statements'.
Except where investments accounted for at cost
shall be accounted for in accordance with Ind-
AS 105, Non-current Assets Held for Sale and
Discontinued Operations, when they are classified
as held for sale.
Investment carried at cost will be tested for
impairment as per Ind-AS 36.
o) Investment in Associate
An associate is an entity over which the Company
has significant influence. Significant influence
is the power to participate in the financial and
operating policy decisions of the investee but is
not control or joint control over those policies.
The Company has elected to recognize its
investments in associate at cost in accordance
with the option available in Ind-AS 27, Separate
Financial Statements'. Except where investments
accounted for at cost shall be accounted for in
accordance with Ind-AS 105, Non-current Assets
Held for Sale and Discontinued Operations, when
they are classified as held for sale.
Investment carried at cost will be tested for
impairment as per Ind-AS 36.
p) Earnings per share
Basic earnings per share
Basic earnings per share are calculated by dividing:
- the profit attributable to owners
of the Company
- by the weighted average number of equity
shares outstanding during the financial
year, adjusted for bonus elements in equity
shares issued during the year and excluding
treasury shares.
Diluted earnings per share
Diluted earnings per share adjust the figures used
in the determination of basic earnings per share
to take into account:
- the after income tax effect of interest and
other financing costs associated with dilutive
potential equity shares, and
- the weighted average number of additional
equity shares that would have been
outstanding assuming the conversion of all
dilutive potential equity shares.
q) Investments in subsidiary and associate
An investor, regardless of the nature of its
involvement with an entity (the investee), shall
determine whether it is a parent by assessing
whether it controls the investee.
An investor controls an investee when it is
exposed, or has rights, to variable returns from
its involvement with the investee and has the
ability to affect those returns through its power
over the investee.
Thus, an investor controls an investee if and only if
the investor has all the following:
(a) power over the investee;
(b) exposure, or rights, to variable returns from
its involvement with the investee and
(c) the ability to use its power over the investee
to affect the amount of the investor's returns.
An associate is an entity over which the Company
has significant influence. Significant influence
is the power to participate in the financial and
operating policy decisions of the investee, but is
not control or joint control over those policies.
The considerations made in determining
significant influence are similar to those
necessary to determine control over subsidiaries.
The Company has elected to recognize its
investments in subsidiary and associate
companies at cost in accordance with the option
available in Ind-AS 27, Separate Financial
Statements'. Except where investments accounted
for at cost shall be accounted for in accordance
with Ind-AS 105, Non-current Assets Held for
Sale and Discontinued Operations, when they are
classified as held for sale.
Investment carried at cost wild be tested for
impairment as per Ind-AS 36.
r) Exceptional items
Items of income or expense which are nonrecurring
or outside of the ordinary course of business and
are of such size, nature or incidence that their
separate disclosure is considered necessary to
explain the performance of the Company are
disclosed as exceptional items in the Statement
of Profit and Loss.
1.1.3 Significant accounting judgements, estimates and
assumptions
The preparation of the Company's 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 areas involving critical estimates are as below:
Defined benefit plans
The cost of the defined benefit gratuity plan and other
post-employment medical benefits 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.
The mortality rate is based on publicly available
mortality tables for the specific countries. Those
mortality tables tend to change only at interval in
response to demographic changes. Future salary
increases and gratuity increases are based on expected
future inflation rates for the respective countries.
Further details about gratuity obligations are
given in Note 23.
Impairment of financial assets
The impairment provisions for financial assets are
based on assumptions about risk of default and
expected loss rates. The Company uses judgement in
making these assumptions and selecting the inputs to
the impairment calculation, based on Company's past
history, existing market conditions as well as forward
looking estimates at the end of each reporting period.
The areas involving critical judgement are as below:
Taxes
Uncertainties exist with respect to the interpretation of
complex tax regulations, changes in tax laws, and the
amount and timing of future taxable income. Given the
wide range of business relationships and the long-term
nature and complexity of existing contractual agreements,
differences arising between the actual results and
the assumptions made, or future changes to such
assumptions, could necessitate future adjustments to
tax income and expense already recorded. The Company
establishes provisions, based on reasonable estimates.
The amount of such provisions is based on various
factors, such as experience of previous tax assessments
and differing interpretations of tax regulations by the
taxable entity and the responsible tax authority. Such
differences of interpretation may arise on a wide variety
of issues depending on the conditions prevailing in the
respective domicile of the Companies.
Deferred tax assets are recognised for unused tax
losses only to the extent that the entity has sufficient
taxable temporary differences against which the unused
tax losses can be utilised. Significant management
judgement is required to determine the amount of
deferred tax assets that can be recognised, based upon
the likely timing and the level of future taxable profits
together with future tax planning strategies.
Further details on taxes are disclosed in Note 25.
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, or when annual impairment testing for
an asset is required, the Company estimates the asset's
recoverable amount. An asset's recoverable amount is
the higher of an asset's or CGU's fair value less costs
of disposal and its value in use. It is determined for an
individual asset, unless the asset does not generate cash
inflows that are largely independent of those from other
assets or group of assets. 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. In assessing value in use,
the estimated future cash flows are discounted to their
present value using a pretax discount rate that reflects
current market assessments of the time value of money
and the risks specific to the asset. In determining fair
value less costs of disposal, recent markets transactions
are taken into account. If no such transactions can be
identified, an appropriate valuation model is used. These
calculations are corroborated by valuation multiples,
quoted share prices for publicly traded subsidiaries or
other available fair value indicators.
1.1.4. Changes in accounting policies and disclosures
New and amended standards
The Company applied for the first-time certain
standards and amendments, which are effective for
annual periods beginning on or after 1 April 2024.
The Company has not early adopted any standard,
interpretation or amendment that has been issued but
is not yet effective.
(i) Ind AS 117 Insurance Contracts
The Ministry of corporate Affairs (MCA) notified the
Ind AS 117, Insurance Contracts, vide notification
dated 12 August 2024, under the Companies
(Indian Accounting Standards) Amendment Rules,
2024, which is effective from annual reporting
periods beginning on or after 1 April 2024.
Ind AS 117 Insurance Contracts is a comprehensive
new accounting standard for insurance contracts
covering recognition and measurement,
presentation and disclosure. Ind AS 117 replaces
Ind AS 104 Insurance Contracts. Ind AS 117 applies
to all types of insurance contracts, regardless of
the type of entities that issue them as well as to
certain guarantees and financial instruments with
discretionary participation features; a few scope
exceptions will apply. Ind AS 117 is based on a
general model, supplemented by:
• A specific adaptation for contracts
with direct participation features (the
variable fee approach)
• A simplified approach (the premium
allocation approach) mainly for short-
duration contracts
The application of Ind AS 117 had no impact on
the Company's standalone financial statements
as the Company has not entered any contracts
in the nature of insurance contracts covered
under Ind AS 117.
(ii) Amendment to Ind AS 116 Leases - Lease
Liability in a Sale and Leaseback
The MCA notified the Companies (Indian
Accounting Standards) Second Amendment
Rules, 2024, which amend Ind AS 116, Leases, with
respect to Lease Liability in a Sale and Leaseback.
The amendment specifies the requirements that a
seller-lessee uses in measuring the lease liability
arising in a sale and leaseback transaction, to
ensure the seller-lessee does not recognise any
amount of the gain or loss that relates to the right
of use it retains.
The amendment is effective for annual reporting
periods beginning on or after 1 April 2024 and
must be applied retrospectively to sale and
leaseback transactions entered into after the date
of initial application of Ind AS 116.
The amendment does not have any impact on the
Company's financial statements.
b Terms of equity shares
The Company has only one class of equity shares having par value of INR 10 per share. Each holder of equity shares is entitled
to one vote per share. The Company declares and pays dividends in Indian Rupees. The dividend proposed, if any by the Board
of Directors is subject to the approval of the shareholders in the ensuing Annual General Meeting, except for Interim Dividend.
In the event of liquidation, the holders of the equity shares will be entitled to receive the 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 shareholders.
18 Earning/lloss) per share
Basic earning/(loss) per share amounts are calculated by dividing the earning/(loss) for the year attributable to equity
holders by the weighted average number of equity shares outstanding during the year.
Diluted earning/(loss) per share amounts are calculated by dividing the earning/(loss) attributable to equity holders by
the weighted average number of equity shares outstanding during the year plus the weighted average number of equity
shares that would be issued on conversion of all the dilutive potential equity shares into equity shares.
The following reflects the income and share data used in the basic and diluted earnings per share computations:
19 Segment reporting
The Company through its subsidiary Next Radio Limited till February 7, 2025 (refer note 2B) is engaged mainly into
the business of radio broadcast and entertainment and there are no other reportable segments as per Ind AS 108 on
Operating Segments.
20 Commitments and contingencies
(i) Contingent liabilities
a. In respect of income tax demand under dispute INR 57 lacs (previous year INR 57 Lacs) against the same the
Company has paid tax under protest of INR Nil Lacs (previous year INR Nil Lacs).
Based on management assessment and current status of the above matter, the management is confident that
no provision is required in the financial statements as on March 31, 2025.
(ii) Commitments
Estimated amount of contracts remaining to be executed on capital account is Nil (Previous year-Nil).
(iii) Guarantees issued- Nil (Previous Year- Nil)
23 Employee Benefits
The Company has classified the various benefits provided to the employees as under.
Defined Contribution Plans
Provident fund
The Company has recognised INR 1 lac (previous year INR 1 lac) in Statement of Profit and Loss towards employer's
contribution to provident fund.
Define Benefit Plan: Gratuity
The Company has a defined benefit gratuity plan. The gratuity plan is governed by the Payment of Gratuity Act, 1972. Every
employee who has completed five years or more of services gets a gratuity on separation at 15 days salary (last drawn
salary) for each completed year of service. The provision is made based on actuarial valuation done by independent valuer.
26 Disclosure required under section 186(4) of the Companies Act, 2013
- Details of investment made are given under Note 2.
27 Financial risk management objectives and policies
The Company's principal financial liabilities, comprise loans and borrowings, trade and other payables. The main purpose
of these financial liabilities is to finance the Company's operations and to support its operations. The Company's principal
financial assets include cash and cash equivalents that derive directly from its operations.
The Company is exposed to credit risk, liquidity risk, foreign currency risk and interest rate risk. The Company's senior
management oversees the mitigation of these risks. The Company's financial risk activities are governed by appropriate
policies and procedures and that financial risks are identified, measured and managed in accordance with the Company's
policies and risk objectives. The policies for managing each of these risks, which are summarized below:-
1 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: interest rate risk and currency risk. Financial
instruments affected by market risk include loans and borrowings, deposits and derivative financial instruments.
a Interest rate risk
Interest rate risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate
because of changes in market interest rates. The companies exposure to the risk of changes in market interest
rates relates primarily to long-term Borrowings with floating interest rates (refer note 10).
b Foreign currency risk
Foreign currency risk arises due to the fluctuations in foreign currency exchange rates. The company has no
exposure against foreign currency risk as at March 31, 2025 and as at March 31, 2024
2 Credit risk
Credit risk refers to the risk of default on its obligation by the counterparty resulting in a financial loss. The Company
is exposed to credit risk from financial investments.
Financial investments
Investments of surplus funds are made as per guidelines and within limits approved by Board of Directors. Board
of Directors/ Management reviews and update guidelines, time to time as per requirement. The guidelines are set
to minimize the concentration of risks and therefore mitigate financial loss through counterparty's potential failure
to make payments.The maximum exposure to credit risk at the reporting date is the carrying value of investment as
disclosed in Note 2B.The Company does not hold any collateral as security.
3 Liquidity Risk
Liquidity risk is defined as a risk that the Company will not be able to settle or meet its obligations on time. The
Group's treasury department is responsible for liquidity, funding as well as settlement management. In addition,
processes and policies related to such risks are overseen by the Senior Management.
Maturities of financial liabilities
The table below summarizes the maturity profile of the Company's financial liabilities based on contractual
undiscounted payments:
28 Capital management
For the purpose of the Company's capital management, capital includes issued equity capital, share premium and all
other equity reserves. The primary objective of the Company's capital management is to maximize the shareholder value.
The Company manages its capital structure and makes adjustments 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. The Company monitors capital using a
gearing ratio, which is net debt divided by total capital and net debt. The Company includes within net debt, interest
bearing loans and borrowings and interest accrued on borrowings.
The following methods and assumptions were used to estimate the fair value:
The fair values of the investment in unquoted equity shares have been estimated using Income Approach. The valuation
requires management to make certain assumptions about the model inputs, including forecast cash flows, discount rate,
credit risk and volatility. The probabilities of the various estimates within the range can be reasonably assessed and are
used in management's estimate of fair value for these unquoted investment.
The significant unobservable inputs used in the fair value measurement categorized within Level 3 of the fair value
hierarchy together with a quantitative sensitivity analysis as at 31 March 2025 are as shown below:
30 Standards issued but not yet effective
Ministry of Corporate Affairs ("MCA") notifies new standard or amendments to the existing standards. There is no such
notification which would have been applicable from April 1, 2025.
31 The Company has incurred losses (before exceptional items) in the current and previous year, also the net worth of the
Company is eroded as at March 31, 2025. Further, the Company's current liabilities exceed current assets as at March 31,
2025. The Company has received a letter of support from its Holding Company where in the Holding company has agreed
to provide financial support to the Company. There are no external borrowings due to banks / financial institutions as at
March 31, 2025. In view of the above, use of going concern assumption has been considered appropriate in preparation of
these standalone financial statements.
32 On the basis of the last audited Financial Statements for the year ended 31 March 2024, the Company meets the Core
Investment Company (CIC) Criteria for classification as CIC in terms of the Master Direction - Core Investment Companies
(Reserve Bank) Directions, 2016, as amended (Regulations') issued by the Reserve Bank of India (RBI') but is exempted
from registration with RBI being not a Systemically Important Core Investment Company (SI-CIC).
33 Statutory Information:
(i) No proceeding has been initiated or pending against the company for holding any benami property under the Benami
Transactions (Prohibition) Act, 1988 (45 of 1988) and rules made thereunder.
(ii) The Company has not been declared as wilful defaulter by any bank or financial Institution or other lender
(iii) The Company has not entered into any transactions with companies struck off under section 248 of the Companies
Act, 2013 or section 560 of Companies Act, 1956.
(iv) There are no transaction which has been surrendered or disclosed as income during the year in the tax assessments
under the Income Tax Act, 1961.
(v) There are no charges or satisfaction yet to be registered with ROC beyond the statutory period.
(vi) There are no funds which 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:
a) directly or indirectly lend or invest in other persons or entities identified in any manner whatsoever ("Ultimate
Beneficiaries") by or on behalf of the Company or
b) provide any guarantee, security or the like to or on behalf of the Ultimate Beneficiaries.
(vii) There are no funds which 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:
a) directly or indirectly, lend or invest in other persons or entities identified in any manner whatsoever ("Ultimate
Beneficiaries") by or on behalf of the Funding Party or
b) provide any guarantee, security or the like from or on behalf of the Ultimate Beneficiaries.
(viii) The Group (as per the provisions of the Core Investment Companies (Reserve Bank) Directions, 2016) does not have
more than one CIC (which is not required to be registered with RBI as not being Systemically Important CIC ).
Note I:
For year ended March 31, 2025:
Reversal of impairment of investments in Next Radio Limited (NRL) amounting to INR 882 lacs has been made during the
current year on account of recoverable amount higher than the carrying amount. The recoverable amount is based on the
value in use (Equity Value) which was determined to be INR 882 lacs using discount rates of 14.85%. The same is being
presented as part of Exceptional item.
For year ended March 31, 2024:
Impairment of investments in subsidiary Next Radio Limited (NRL) amounting to INR 777 lacs has been recorded during
the year ended March 31, 2024 on account of recoverable amount lower than the carrying amount. The recoverable
amount of INR Nil lacs for the investment is determined as a weighted average of value in use using the discount rate of
14.40% and fair value less cost of disposal. The same is being presented as part of Exceptional item.
35 The Company has used accounting software - SAP for maintaining its books of account which has a feature of recording
audit trail (edit log) facility and the same has operated throughout the year for all relevant transactions recorded in
the software, except that audit trail feature was enabled at the database level from June 1, 2024. Further, there are no
instance of audit trail feature being tampered with. Additionally the audit trail of prior year has been preserved as per the
statutory requirements for record retention to the extent it was enabled and recorded in the prior year.
See accompanying notes to the standalone financial statements.
In terms of our report of even date attached
For S.R. BATLIBOI & ASSOCIATES LLP For and on behalf of the Board of Directors of
Chartered Accountants Next Mediaworks Limited
(Firm Registration Number: 101049W/E300004)
Nikhil Aggarwal Priyatn Agrawal Rohit Kalra
Partner Chief Financial Officer Chief Executive Officer
Membership No. 504274
Sonali Manchanda Samudra Bhattacharya Sameer Singh
Company Secretary Director Director
(M.No: F7283) (DIN:02797819) (DIN: 08138465)
Place: New Delhi Place: New Delhi
Date: May 1 5, 2025 Date: May 15, 2025
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