Note 15.2 : Terms/ Rights Attached to Shares Equity : The Company has only one class of Equity Shares having a par value of Rs. 10 per share. Each holder of Equity Shares is entitled to one vote per share and ranks pari passu. The Dividend proposed by the Board of Directors is subject to approval of the shareholders at the ensuing Annual General Meeting. In the event of liquidation, the equity shareholders are eligible 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 the Shareholders.
Note 15.3 : 1466250 Equity Shares out of issued subscribed and paid up share capital were allotted in pursuant to the Scheme of Arrangement as approved by the Hon'ble Allahabad High Court on 5th July 2011 without payment being received in cash.
Note 15.4 : 723125 12% Non Cumulative Compulsorily Redeemable Preference Shares, redeemable at par within a period of 10 years from the date of issue, with a call option available to the company for early redemption, have been issued without payment being received in cash to the share holders of Amalgamating Company in pursuance of Scheme of Arrangement as approved by Hon'ble Allahabad High Court on 5th July 2011.
Note 15.5 : In earlier years Company has redeemed 253093 & 196708 totalling 449801 12% Non Cumulative Compulsorily Redeemable Preference Shares of Rs. 100 each .The same is approved by Board of Directors in their meeting held at 29.05.2013 & 11.02.2014 respectively. In respect to above Capital Redemption Reserve of Rs. 449.80 Lakh has been created by debiting Rs. 44.98 Lakh from Preference Share Redemption Reserve and Rs. 404.82 Lakh from surplus in the Statement of Profit and Loss.
Note 15.6 : In earlier years Company has further redeemed balance 273324 12% Non Cumulative Compulsorily Redeemable Preference Shares of Rs. 100 each .The same is approved by Board of Directors in their meeting held at 14.11.2014 &12.02.2015 respectively. In respect to above Capital Redemption Reserve of Rs. 273.32 Lakh has been created by debiting Rs. 54.66 Lakh from Preference Share Redemption Reserve and Rs. 218.66 Lakh from surplus in the Statement of Profit and Loss.
#The aforesaid disclosure is based upon percentages computed separately for class of shares outstanding as at the balance sheet date. As per records of the company, including its register of shareholders/members and other declaration received from shareholders regarding beneficial interest, the above shareholding represents both legal & beneficial ownership of shares.
Nature and purpose of each reserve with in equity
1. Capital Reserve : This reserve has been transferred to the company in earlier years and can be utilized in accordance with the provisions of Companies Act, 2013
2. General Reserve : The reserve used to transfer profits from retained earnings for appropriation purposes. The amount is to be utilized in accordance with the provisions of Companies Act, 2013
3. Captal Redemption Reserve : Capital Redemption Reserve was created by transferring from retained earnings on account of redemption of non cumulative compulsorily redeemable preference shares. The amount is to be utilized in accordance with the provisions of Companies Act, 2013
4. Retained Earnings : These are the profits that company has earned till date less transfers to general reserve.
5. Other comprehensive Income (OCI) : This includes remeasurement loss/gain on defined benefit plans (net of taxes) that will not be reclassified to the statement of profit and loss.
Security
*First charge in favour of HDFC Bank by way of Hypothecation of the Company on the property. Hall no. H-1, First Floor, Padam Plaza, Plot No.5, Sector-16b, Sikandra, Avas Vikas Sikandra Yojna, Agra. 282007 and Hall No.H-2, First Floor, Padam Plaza, Plot No.5, Sector-16b, Sikandra, Avas Vikas Sikandra Yojna, Agra-282007.
** Primary Security: Extensionof 2nd Hypothecation charge entire present and future current assets of the company Collateral : Extension of 2nd Charge on existing security as Factory land & building situated at plot no.51-52 Malanpur Industrial Area , Distt. Bhind.(M.P.) measuring 31017.58 sft, Factory Land and Building at 7 km Stone Adalpur Dholpur, Rajasthan,measuring 52155.63 sqmt.
Note 21.1 : Nature of Security of Working Capital Loans & Term Loan :
Working capital loan from Axis Bank Ltd., are secured by way of hypothecation charge on entire current assets comprising of stocks of raw material, stores & spares, stock in process, Finished Goods lying in Unit's works, godowns, offices, and elsewhere in units posession including the goods in transit & cash credit balance in their accounts and further secured by all present and future book debts/receivables etc. It is further collaterally secured by way of equitable mortgage of Factory land & building situated at plot no.51-52 Malanpur Industrial Area , Distt. Bhind.(M.P.) measuring 31017.58 sft, Factory Land and Building at 7 km Stone Adalpur Dholpur, Rajasthan,measuring 52155.63 sqmt and hypothecation of entire plant & machinery movable and immovable (present & future) in the name of company located at various units and elsewhere. Further secured by personal guarantee of Shri Mayank Jain, Shri Ankur Jain & Shri Ankit Jain.
41. Balances of trade receivable, trade payable, loan/advances given and other financial and non financial assets and liabilities are subject to reconciliation and confirmation from respective parties. The balance of said trade payable, loan/advances given and other financial and non financial assets and liabilities are taken as shown by the books of accounts. the ultimate outcome of such reconciliation and confirmation cannot presently be determined, therefore, no provision for any liability that may result out of such reconciliation and confirmation has been made in the financial statement, the financial impact of which is unascertainable due to the reasons as above stated.
42. Defined Benefit Plan- Gratuity 1 Actuarial Assumptions
a) Economic Assumptions : The principal assumptions are the discount rate & salary growth rate. The discount rate is generally based upon the market yields available on Government bonds at the accounting date relevant to currency of benefit payments for a term that matches the liabilities. Salary growth rate is company’s long term best estimate as to salary increases & takes account of inflation, seniority, promotion, business plan, HR policy and other relevant factors on long term basis as provided in relevant accounting standard. These valuation assumptions are as follows :
3.5: Effect of plan on entity’s future cash flows 3.5 (a): Funding arrangements and funding policy
The company has purchased an insurance policy to provide for payment of gratuity to the employees. Every year, the insurance company carries out a funding valuation based on the latest employee data provided by the company. Any deficit in the assets arising as results of such valuation is funded by the company
Note. : The fair value of plan assets as at 31.03.2024 is more than the present value of obligation as at 31.03.2024, therefore no adjustment have been made in the Balance Sheet. Further the amount of premium of Rs. 8,67,259/- paid to LIC is debited to Statement of Profit and Loss.
Description of Risk Exposures : Valuations are based on certain assumptions, which are dynamic in nature and vary over time. As such company is exposed to various risks as follow-
A) Salary Increases - Actual salary increases will increase the Plan’s liability. Increase in salary increase rate assumption in future valuations will also increase the liability.
B) Investment Risk - If Plan is funded then assets liabilities mismatch & actual investment return on assets lower than the discount rate assumed at the last valuation date can impact the liability.
C) Discount Rate - Reduction in discount rate in subsequent valuations can increase the plan’s liability.
D) Mortality & disability - Actual deaths & disability cases proving lower or higher than assumed in the valuation can impact the liabilities.
E) Withdrawals - Actual withdrawals proving higher or lower than assumed withdrawals and change of withdrawal rates at subsequent valuations can impact Plan’s liability
Leave encashment ( Unfunded) : The valuation of Leave Encashment has been done on the basis of actuarial valuation on Projected Unit Credit ( PUC) method and is provided in the financial statement and does not require disclosure as mentioned in Para 158 of IND AS 19. Provision of leave encashment as per actuarial is less than the liability provided in books of accounts, hence the management has made the provision for leave encashment on accrual basis.
Defined Contribution Plan :
Provident Fund - The company contributes Provident Fund ( Employer as well as Employee Share) to Provident Fund Commissioner Aga ( U.P) and Employers Contribution to such fund is charged to Statement of Profit and Loss. The Provident fund contribution charged to Statement of Profit and Loss for the the year ended 31.03.2024 amounted to Rs 42.59 Lacs
43. Fair value measurement
Financial instruments : Accounting classification and fair value measurements
This section explains the judgements and estimates made in determining the fair values of the financial instruments that are (a) recognised and measured at fair value and (b) measured at amortised cost and for which fair values are disclosed in the financial statements. To provide an indication about the reliability of the inputs used in determining fair value, the Company has classified its financial instruments into the three levels prescribed under the Accounting Standard. An explanation of each level follows underneath the table.
44. Financial Risk Management : The company activities exposes it to variety at financial risk i.e. Credit Risk , Liquidity Risk , Capital Risk , Interest Rate Risk. These risks are managed by senior management of the company and is supervised by Board of Directors of the company , to minimise potential adverse effects on the financial performance of the company.
The Board of Directors of the company provides guiding principles for overall risk management, as well as policies covering specific areas i.e. credit risk & Investment of Surplus liquidity..
The company's risk management is carried out by finance department, accordingly, this department identifies, evaluates and hedges financial risk..
A) Price Risk : The main Raw materials for manufacturing of Soap, Cake & Powder are Rice Brand Oil, Palm Fatty Oil, Acid Oil etc. The prices of Raw materials are mainly dependent on the price of Crude Oil. The majority of Raw materials are being procured indigenously. In case of fluctuation in price of Raw Materials, the Company makes appropriate changes in the prices of Finished Products, after due discussions with the dealers. The prices of Finished Goods are generally reviewed every year and appropriate changes in prices are made to offset the increase in cost.
B) Credit Risk : Credit risk arises from cash and cash equivalents, financial assets measured at amortised cost and trade receivables.
(i) Credit Risk : Credit risk from cash and cash equivalents and bank deposits is considered immaterial in view of the creditworthiness of the banks the company works with. Credit risk is the risk i.e a customer or the counter party fails to pay to the company causing financial loss. The credit risk primarily arises from outstanding receivables from customer. The company has specific policies for managing customer credit risk on an ongoing basis; These policies factor in the customer financial position, past experience and other customer specific factor.
Financial assets are written off when there is no reasonable expectation of recovery, such as a debtor failing to engage in a repayment plan with the company. The Company makes provision for doubtful debt or write off when a debtor fails to make contractual payments greater than two years past due. When loans or receivables have either been provided for or written off, the company continues to engage in enforcement activity to attempt to recover the receivable due. When recoveries are made, these are recognised in the Statement of Profit and Loss. The company has low credit risk in respect to cash and cash equivalent, other bank balances, other financial assets, trade receivables and security deposits paid.
(ii) Liquidity Risk : Liquidity risk is defined as the risk that the Company will not be able to settle or meet its obligations on time or at reasonable price. The Company’s objective is to at all times maintain optimum levels of liquidity to meet its cash and liquidity requirements. The Company closely monitors its liquidity position and maintains adequate source of financing through the use of short-term bank deposits, demand loans and cash credit facility. Processes and policies related to such risks are overseen by senior management. The company have adequate liquidity and considers liquidity risk as low risk.
(iii) Capital Risk Management: The company capital risk management objective is to ensure that all times its remains a going concern and safeguards the interest of the shareholders and other stakeholders. The company monitors capital on the basis of carrying amount of equity plus its subordinated loan, less cash and other cash equivalents as presented on the face of the statement of financial position and cash flow hedges recognised in other comprehensive income.
The company manages its capital structure and makes adjustments to it in the light of changes in economic conditions and the risk characteristics of the underlying assets. In order to maintain or adjust the capital structure, the Company may adjust the amount of dividends paid to the shareholders, return capital to shareholders or issue new shares. The amount managed as capital by the Company are summarised as follows :
The above chart depicts that the company have low interest risk
(v) Market Risk : Market risk is the risk that the fair value of future cash flows of the business of manufacture of laundry soap, detergent powder and detergent cake (being essential items). The Company sales and collection has being increased. The Company has assessed the carrying amount of receivables, inventories, investments and other current assets and liabilities. The company will continue to monitor developments to identify significant uncertanities in future periods, if any. The Company has low market risk.
(vi) Foreign Currency Risk : The company do not normally deal in foreign currency transactions. The company do not have any foreign currency risk.
45. Leases : The principal portion of the lease payments and interest have been disclosed under cash flow from financing activities. The weighted average incremental borrowing rate of 8% has been applied to lease liability recognised in balance sheet at the date of initial application.'On application of IndAs 116, the nature of expense has changed from lease rent in previous periods to depreciation cost for right to use asset and finance cost for interest accured on lease liability.
49. Events occuring after Balance Sheet : On 28th May, 2024 the board of directors recommended a final dividend of Rs 5.00 per equity share (Face Value of Rs.10/- each) be paid to the shareholders for financial year 2023-24, which is subject to approval by the shareholders at the Annual General Meeting. If approved the dividend would result in a cash outflow of Rs 132.30 lakhs.
50. OTHER STATUTORY INFORMATION
(i) The Company do not have any Benami property, where any proceeding has been initiated or pending against the Company for holding any Benami property.
(ii) The Company do not have any transactions with companies struck off.
(iii) The Company do not have any charges or satisfaction which is yet to be registered with ROC beyond the statutory period,
(iv) The Company have not traded or invested in Crypto currency or Virtual Currency during the financial year.
(v) The Company have not advanced or loaned or invested funds to any other person(s) or entity(ies), including foreign entities (Intermediaries) with the understanding that the Intermediary shall: (a) directly or indirectly lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the company (Ultimate Beneficiaries) or (b) provide any guarantee, security or the like to or on behalf of the Ultimate Beneficiaries
(vi) The Company have 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: (a) 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 (b) provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries.
(vii) The Company have not any such transaction which is not recorded in the books of account 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.
(viii) The Company has not been declared a wilful defaulter by any bank or financial institution or government authroties during the year
(ix) During the year there is no scheme or arrangement approved by the competent authority in terms of section 230 to 237 of Companies Act, 2013.
51 Audit Trail : The company has used an accounting software for maintaining its books of accounts for the financial year ended 31.03.2024, which has a feature of recording audit trail (Edit log) facility and the same has been operating for all relevant transactions recorded in the software except for payroll. Although the accounting software has inherent limitations, there were no instances of the audit trail feature being tempered.
52. Previous years figures have been regrouped, rearranged or reclassified, whereever necessary to confirm the current year's classification.
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