g) Provisions, Contingent Liabilities and
Contingent Assets
A provision is recognised if, as a result of a
past event, the Company has a present legal or
constructive obligation that can be estimated
reliably and it is probable that an outflow of
economic resources will be required to settle
the obligation. If the effect of the time value of
money is material, provisions are determined
by discounting the expected future cash flows
at a pre-tax rate that reflects current market
assessments of the time value of money and the
risks specific to the liability. Where discounting
is used, the increase in the provision due to the
passage of time is recognised as a finance cost.
Contingent liability is not recognised but disclosed
in notes to the financial statements when there is
a possible obligation arising from past events, the
existence of which will be confirmed only by the
occurrence or non-occurrence of one or more
uncertain future events not wholly within the control
of the Company or a present obligation that arises
from past events where it is either not probable that
an outflow of resources will be required to settle
the obligation or a reliable estimate of the amount
cannot be made. Contingent Liability is disclosed
after careful evaluation of facts, uncertainties and
possibility of reimbursement, unless the possibility
of an outflow of resources embodying economic
benefits is remote.
A contingent asset is not recognised unless
it becomes virtually certain that an inflow of
economic benefits will arise. When an inflow
of economic benefits is probable, contingent
asset are disclosed in the standalone financial
statements.
h) Other Income
i) Interest Income
Interest income is accrued on a time basis, by
reference to the principal outstanding and at the
effective interest rate applicable, which is the
rate that exactly discounts estimated future cash
receipts through the expected life of the financial
asset to the asset's net carrying amount on initial
recognition.
Interest income is included in other income in the
statement of profit and loss.
ii) Dividend Income
Dividend income is recognised when the
Company’s right to receive dividend is established
and is included in other income in statement of
profit and loss.
i) Employee Benefits
i) Defined contribution plans
Employees benefits in the form of the Company’s
contribution to Provident Fund, Pension scheme,
Superannuation Fund and Employees State
Insurance are defined contribution schemes.
Under a defined contribution plan, the Company’s
sole obligation is to pay a fixed amount with no
obligation to pay further contributions if the fund
does not hold sufficient assets to pay all employee
benefits. The related actuarial and investment
risks are borne by the employee. The Company
recognises contribution payable to these schemes
as an expense, when employees provide services.
ii) Defined benefit plans
Retirement benefits in the form of gratuity are
considered as defined benefit plans. Under a
defined benefit plan, it is the Company’s obligation
to provide agreed benefits to the employees. The
related actuarial and investment risks are borne
by the Company. The Company's net obligation
in respect of defined benefit plans is calculated by
present value of the defined benefit obligation at
the end of the reporting period less the fair value
of plan assets.
The company provides for its gratuity liability
based on actuarial valuation of the gratuity liability
as at the Balance Sheet date, based on Projected
Unit Credit Method, carried out by an actuary. The
Company contributes to the gratuity fund, which
are recognised as plan assets. The defined benefit
obligation as reduced by fair value of plan assets
is recognised in the Balance Sheet.
The present value of the defined benefit obligation
is determined by discounting the estimated future
cash outflows by reference to market yields at the
end of the reporting period on government bonds
that have terms approximating to the terms of the
related obligation.
Re-measurement of the net defined benefit
liability, which comprise actuarial gains and losses,
the return on plan assets (excluding interest) and
the effect of the asset ceiling (if any, excluding
interest), are recognised in the period in which
they occur, directly in other comprehensive
income. Net interest expense (income) on the net
defined liability (assets) is computed by applying
the discount rate, used to measure the net defined
liability (asset), to the net defined liability (asset)
at the start of the financial year after taking into
account any changes as a result of contribution
and benefit payments during the year. Net interest
expense and other expenses related to defined
benefit plans are recognised in statement of profit
and loss under employee benefit expense.
When the benefits of a plan are changed or when
a plan is curtailed, the resulting change in benefit
that relates to past service or the gain or loss on
curtailment is recognised immediately in statement
of profit and loss. The Company recognises gains
and losses on the settlement of a defined benefit
plan when the settlement occurs.
iii) Compensated absence
The Company provides for accumulation of
compensated absences, employees can carry
forward a portion of the unutilised compensated
absences and utilise them in future periods or
receive cash in lieu thereof as per the Company’s
policy. The Company records a liability for
compensated absences in the period in which the
employee renders the services.
j) Share-based payment transaction
The grant date fair value of equity settled share-
based payment awards granted to employees
is recognised as an employee benefit expense,
with a corresponding increase in equity. The total
expense is recognised over the vesting period,
which is the period over which all of the specified
vesting conditions are to be satisfied and is
adjusted to reflect the actual number of share
options that vest.
The total amount to be expensed is determined by
reference to the fair value of the options granted
including any market performance conditions
and the impact of any non-vesting conditions
and excluding the impact of any service and non¬
market performance vesting conditions.
k) Income tax
Income tax expense comprises current and
deferred tax. It is recognised in statement of
profit and loss except to the extent that it relates
to items recognised directly in equity or in other
comprehensive income.
i) Current tax
Current tax comprises the expected tax payable or
receivable on the taxable income or loss for the year
after taking credit of the benefits available under
the Income Tax Act, 1961 and any adjustment to
the tax payable or receivable in respect of previous
years. It is measured using tax rates enacted or
substantively enacted at the reporting date.
ii) Deferred tax
Deferred tax is recognised in respect of temporary
differences between the carrying amounts of assets
and liabilities for financial reporting purposes and
the corresponding tax bases used for taxation
purposes.
For operations carried out in tax free units, deferred
tax assets or liabilities, if any, have been recognised
for the tax consequences of those temporary
differences between the carrying values of assets
and liabilities and their respective tax bases that
reverse after the tax holiday ends.
Deferred tax assets include Minimum Alternative
Tax (MAT) paid in accordance with the tax laws,
which gives rise to future economic benefits in the
form of adjustment of future income tax liability, is
considered as an asset if there is probable evidence
that the Company will pay normal income tax in
future. Accordingly, MAT is recognised as deferred
tax asset in the Balance Sheet when the asset can
be measured reliably and it is probable that the
future economic benefit associated with the asset
will be realised.
Company also considers decisions of appropriate
authorities and legal advice for recognising taxes.
l) Segment Reporting
An operating segment is defined as a component
of the entity that represents business activities
from which it earns revenues and incurs expenses
and for which discrete financial information is
available. The operating segments are based on
the Company’s internal reporting structure and the
manner in which operating results are reviewed by
the Chief Operating Decision Maker (CODM).
The Management Advisory Committee of the
Company has been identified as the CODM by the
Company. Refer Note 34 for Segment disclosure.
m) Earnings per share
Basic earnings per share is calculated by dividing
the net profit or loss for the period attributable
to Equity Shareholders by the weighted average
number of equity shares outstanding during the
period.
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.
n) Dividends
Final dividends on shares are recorded as a liability
on the date of approval by the shareholders and
interim dividends are recorded as a liability on the
date of declaration by the Company’s Board of
Directors.
o) Exceptional items
The Company recognises exceptional item when
items of income and expenses within Statement
of Profit and Loss from ordinary activities are
of such size, nature or incidence that their
disclosure is relevant to explain the performance
of the enterprise for the year.Refer note 26A to the
standalone financial statements
a. The difference between the issued and subscribed capital is on account of less number of shares allotted in
right issue in earlier years.
b. Terms/ rights attached to Equity Shares
The Company has only one class of Equity Shares having a par value of ?! per share (March 31, 2025'1 per
share). Each holder of Equity Shares is entitled to one vote per share. The dividend proposed by the Board of
Directors is subject to the approval of the shareholders in the ensuing Annual General Meeting except interim
dividend. In the event of liquidation, the Equity shareholders are eligible to receive the remaining assets of the
Company after distribution of all preferential amounts, in proportion to their shareholding.
c. Issue of Shares under employee stock option (ESOP) Scheme
During the year ended March 31, 2026, the Company has issued Nil equity shares (March 31, 2025 Nil), as
per exercise price to PII ESOP Trust, set up to administer Employee Stock Option Plan. Out of total equity
shares issued to the Trust in previous years, 2,909 equity shares of face value of ' 1 each (March 31, 2025
10,775 equity shares of face value of ' 1 each) have been allocated by the Trust to respective employees upon
exercise of Stock Option. As on March 31, 2026, 61,326 equity shares of face value of ' 1 per share (March
31, 2025 : 14,885 of face value of ' 1 each) are pending to be allocated to employees upon exercise of Stock
Option. (Refer Note 31)
S upplier Financing Arrangements for Trade Payables
The Company has arranged a supply chain facility from various banks to facilitate suppliers who are willing
to get their bills (duly accepted by PI Industries Limited) discounted. These arrangements provide the entity
with no extended payment terms, or the entity’s suppliers with early payment terms, compared to the related
invoice payment due date.
No security or guarantees are provided under these arrangements and there is no obligation of the Company
towards interest or discounting charges.
(i) Compensated absences
The compensated absences cover the Company’s liability for earned leave which are classified as
other long-term benefits.
The entire amount of provision of ' 300 (March 31,2025: ' 244) is presented as current, since the
Company does not have the right at the end of the reporting period to defer settlement for any of these
obligations for atleast 12 months after the reporting period. However, based on past experience, the
Company does not expect all employees to avail the full amount of accrued leave or require payment for
such leave within next 12 months.
(ii) Information about provisions for legal claims
(a) Government of Rajasthan issued a notification resulting into an excise liability of ' 4 (March 31, 2025:
' 4 ). The Company has filed writ against the notification and has furnished fixed deposit against the
said liability. The case is pending before Honorable Rajasthan High Court.
(b) An objection was raised by the custom department on classification of one of the product on which
MEIS has been claimed. The Company is in process of filing the appeal against the order. As on March
31, 2026 provision for custom duty of ' 10 (March 31, 2025 : ' 10).
Critical judgements in recognising revenue :
The Company has recognised Provision for discounts and sales returns amounting to ' 1,022 from sale
of products to various customers as at March 31, 2026 (March 31, 2025: ' 923). The provision has been
determined by the management based on the current and expected operating environment, Sales returns
variability, expected achievement of targets against various ongoing schemes floated.
For disaggregation of revenue from contract from customer in terms of geographical area, major products,
timing of revenue recognition refer note - 34 and for contract assets and contract liabilities refer note - 7(h)
and 17 respectively.
a) As at March 31, 2026, investments in equity shares of PI Health Science Limited (PIHS) amounted to
' 4,410. In view of business losses of PIHS, the management has reassessed the carrying value of the
said investment and based on an independent valuer’s report, recognised a provision of ' 1,100, which
has been disclosed as “Exceptional Item” in these financial statements. The management is confident
of the future prospect of PIHS and believes the aforesaid adjustment does not reflect any change in the
long-term value. Key assumptions underlying the value in use calculation are those regarding expected
revenues, a post-tax discount rate of 14% per annum (March 31, 2025: 13%). Sales growth projections
consider managements’ expectation of market development, current industry trends and post-tax discount
rate based on the relevant risks. 5% growth rate has been used in the terminal year.
b) Pursuant to the notification issued by the Ministry of Labour and Employment, multiple existing labour
legislations have been consolidated into a unified framework comprising four Labour Codes, collectively
referred to as the ‘New Labour Codes’ which became effective from November 21, 2025. The company
has reassessed its employee benefit obligations in accordance with the revised definition of “Wages”.
Considering that this impact is driven by a regulatory change and is non-recurring in nature, accordingly,
an incremental liability has been recognised as an Exceptional Item for the year ended March 31, 2026.
The Ministry is in the process of notifying related rules to the New Labour Codes and impact of those will
be evaluated and accounted for in the period in which they are notified.
30 Employee Benefit
The Company participates in defined contribution and benefit schemes, the assets of which are held (where
funded) in separately administered funds. For defined contribution schemes the amount charged to the
statement of profit and loss is the total contribution payable in the year.
Provident Fund
In accordance with the Employees’ Provident Fund and Miscellaneous Provisions Act, 1952 (EPF and MP Act),
employees are entitled to receive benefits under the Provident Fund. Employers and employees both contribute
@12% of wages in contribution accounts. Further, the employers also contribute towards administration of the
benefits under the EPF and MP Act. All employees have an option to make additional voluntary contributions
as permissible under the EPF and MP Act. These contributions are made to the fund administered and
managed by the Employee Provident Fund organization. The Company has no further obligations under
the fund managed by the Employee Provident Fund Organization (EPFO) beyond its monthly contributions
which are charged to the statement of profit and loss in the period they are incurred. The benefits are paid to
employees on their retirement or resignation from the EPFO. Also, refer note 33.
Gratuity Plan
In accordance with the Payment of Gratuity Act, 1972 the Company has established a defined benefit plan (the
“Gratuity Plan”). The Gratuity Plan provides a lump sum payment to the employees at the time of retirement
or resignation (after 5 years of continued services of employment), being an amount based on the respective
employee’s last drawn salary and the number of years of employment with the Company. Based on actuarial
valuations conducted at year end, a provision is recognised in full for the benefit obligation over and above
the funds held in the Gratuity Plan. Remeasurements as a result of experience adjustments and changes in
actuarial assumptions are recognised in other comprehensive income.
Compensated absences
The liabilities for compensated absence namely earned and contingency leave are not expected to be
settled wholly within 12 months after the end of the period in which the employees render the related service.
They are therefore measured as the present value of expected future payments to be made in respect of
services provided by employees up to the end of the reporting period using the projected unit credit method.
Remeasurements as a result of experience adjustments and changes in actuarial assumptions are recognised
in statement of profit and loss.
IX Major Categories of plan assets
T he plan assets are managed by the Gratuity Trust formed by the Company. The management of 100%
of the funds is entrusted with the Life Insurance Corporation of India, HDFC Life Insurance Company Ltd.,
Kotak Mahindra Old Mutual Life Insurance Ltd. and Kotak Mahindra Life Insurance Ltd. Refer Below for
major categories of plan assets invested where available.
a) Life Insurance Corporation of India (LIC):- The details of investments maintained by LIC are
not available and have therefore not been disclosed.
b) HDFC Standard Life Insurance Company Ltd.:- 24.99% (March 31, 2025 25.61%) of the funds
are in Defensive Manager Fund, 54.58% (March 31, 2025 54.67 %) of the funds are in Secure
Managed Fund and 20.43% (March 31, 2025 19.73%) of the funds are in Stable Managed Fund.
c) Kotak Mahindra Old Mutual Life Insurance Ltd.: - 2.25% (March 31, 2025 60.86 %) of the
funds are in Kotak Group Bond Fund, 1.40% (March 31, 2025 39.14%) of the funds are in Kotak
Group Balance Fund, 96.35% (March 31, 2025 Nil) of the funds are in Kotak Group Prudent Fund.
d) Kotak Mahindra Life Insurance Ltd.:- 38.67% (March 31, 2025 100%) of the funds are in Kotak
Secure Return Employee Benefit Plan and Kotak assured Return Employee Benefit Plan:- 61.33%
(March 31, 2025 Nil).
X Description of Risk Exposures
Taluations are based on certain assumptions, which are dynamic in nature and vary over time. As such the
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 the mismatch between assets and liabilities and actual
return on assets being 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.
C) Compensated absences
The provision for compensated absences covers the Company’s liability for earned and Contingencies leave,
the amount of provision recognized is ' 300 (March 31, 2025'210).
31 Share Based PaymenT
Employee Stock Option Plan
The Company provides share-based payment schemes to its employees. The relevant details of the scheme
are as follows:
In December 2010, the Board of Directors approved the PII ESOP 2010 Scheme in order to reward the
employees for their past association and performance as well as to motivate them to contribute to the growth
and profitability of the Company (including subsidiary companies) with an intent to attract and retain talent in
the organization. The aforesaid scheme was duly approved by shareholders in its EGM held on January 21,
2011 and is administered through independent trust. The Compensation Committee of the Board has granted
following options under PII ESOP 2010 Scheme to certain category of employees as per criteria laid down by
Compensation Committee of the Board.
b. Lessee
The Company leases various offices, warehouses, godown, IT equipment and vehicles. Rental contracts
are typically made for fixed periods of 6 months to 9 years. The leases have varying terms, escalation
clauses and renewal rights. The Company has recognised Right of Use Assets refer note 4 (d) for these
leases except for short term and low value lease.
# Represents amounts as stated in Demand Order excluding interest.
* Pending resolution of the respective proceedings, it is not practicable for the Company to estimate the
timings of the cash outflows, if any, in respect of the above as it is determinable only on receipt of the
judgements/ decisions pending with various forums / authorities.
The Company has reviewed all its pending litigations and proceedings and has adequately provided for where
provisions are required and disclosed as contingent liabilities where applicable, in its financial statements.
The Company does not expect the outcome of these proceedings to have a materially adverse effect on its
financial position.
In Company’s assessment the impact of the recent Supreme Court Judgment in case of “Vivekananda
Vidyamandir And Others Vs The Regional Provident Fund Commissioner (II) West Bengal” and the related
circular (Circular No. C-I/l(33)2019/ Vivekananda Vidya Mandir/284) dated March 20, 2019 and circular No.
C-I/l(33)2019/Vivekanand Vidyamandir/717 dated August 28, 2019 issued by the Employees’ Provident Fund
Organisation in relation to non-exclusion of certain allowances from the definition of “basic wages” of the
relevant employees for the purposes of determining contribution to provident fund under the Employees’
Provident Funds & Miscellaneous Provisions Act, 1952 and computation of liability to be done as per provision
of Para 2(f) of EPF Scheme, 1952, the aforesaid matter is not likely to have a significant impact and accordingly,
no provision has been made in these standalone Financial Statements.
34 Operating Segment
An operating segment is defined as a component of the entity that represents business activities from which
it earns revenues and incurs expenses and for which discrete financial information is available. The operating
segments are based on the Company’s internal reporting structure and the manner in which operating
results are reviewed by the Chief Operating Decision Maker (CODM).
The Company has evaluated the applicability of segment reporting and has concluded that since the
Company is operating in the field of Agro Chemicals both in the domestic and export markets and the
CODM reviews the overall performance of the agro chemicals business, accordingly the Company has one
reportable business segment viz. Agro Chemicals.
I. Revenue
A. Information about product revenues:
The Company is in the business of manufacturing and distribution of Agro Chemicals. The amount of its
revenue from external customers broken down by products is shown in the table below:
C) Terms and conditions of transactions with related parties
The sales and purchases / services rendered to and from related parties are made on terms equivalent to those
that prevail in arm’s length transactions. Outstanding balances at the year-end are unsecured and interest free
(except the Optionally fully convertible debentures) and settlement occurs in cash and cash equivalent. There
have been no guarantees provided or received for any related party receivables or payables. For the year
ended March 31, 2026, the Company has not recorded any impairment of receivables relating to amounts
owed by related parties (March 31, 2025: ' Nil). This assessment is undertaken each financial year through
examining the financial position of the related party and the market in which the related party operates.
* Excluding Investment in subsidiaries measured at cost in accordance with Ind AS 27
** Excluding lease liabilities measured in accordance with Ind AS 116
# The fair value of investments in Optionally fully convertible debentures is determined based on the
higher of the values of the redemption option and the conversion option. The redemption option is valued
using discounted cash flow analysis of contractual interest and redemption cash flows, including an
estimated redemption premium of 7.04% as at March 31, 2026. The conversion option is valued based on
the equity value derived using the discounted cash flow method. Key assumptions underlying the equity
valuation are the same as disclosed in Note 26A(a) of these standalone financial statements.
B. Fair value hierarchy
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.
The fair value of cash and cash equivalents, bank balances other than cash and cash equivalents, deposits
with financial institution, trade receivables, loans and advances, contract assets, current financial assets,
trade payables, current financial liabilities and borrowings approximate their carrying amount, largely due
to the short-term nature of these instruments. Fair value for non-current assets and liabilities is equivalent
to the amortised cost, interest rate on them is equivalent to the market rate of interest.
Fair value hierarchy
The table shown above analyses financial instruments carried at fair value, by valuation method. The
different levels have been defined below:
Level 1 - This includes financial instruments measured using quoted prices. The mutual funds are valued
using closing net assets value (NAV).
Level 2 - Inputs other than quoted prices included within Level 1 that are observable for the asset or
liability, either directly (i.e. as prices) or indirectly (i.e. derived from prices).
Level 3 - If one or more of the significant inputs is not based on observable market data, the instrument
is included in level 3.
There are no transfers between level 1, level 2 and level 3 during the year and the previous year.
Valuation technique used to determine fair value:
The fair values of the financial assets and liabilities are defined as the price that would be received on
sale of an asset or paid to transfer a liability in an orderly transaction between market participants at the
measurement date. Methods and assumptions used to estimate the fair values are consistent with those
used for the year ended March 31, 2025.
Specific valuation techniques used to value financial instruments include:
- the fair value of investment in mutual fund is determined using quoted market prices
- the fair value of forward foreign exchange contracts is determined using forward exchange rates at the
balance sheet date
- the fair value of the remaining financial instruments is determined using discounted cash flow analysis.
38 Financial Risk Management
Risk management framework
The Company is exposed to credit risk, liquidity risk and market risk. The Company’s board of directors
has the overall responsibility for the management of these risks and is supported by Management Advisory
Committee that advises on the appropriate financial risk governance framework. The Company has risk
management policies and systems in place which are reviewed regularly to reflect changes in market
conditions and price risk along with the Company’s activities. The Company’s audit committee oversees
how management monitors compliance with the financial risk management policies and procedures and
reviews the adequacy of risk management framework in relation to the risks faced by the Company.
This note explains the sources of risk which the entity is exposed to and how the entity manages the risk
and impact of hedge accounting in the financial statements.
i. Credit risk
Credit risk is the risk of financial loss to the Company if a customer or counterparty to a financial
instrument fails to meet its contractual obligation and arises from the operating activities primarily (trade
receivables) and from its financing activities including cash and cash equivalents, deposits with banks,
derivatives and other financial instruments. The carrying amount of financial assets represents the
maximum credit exposure and is as follows:
Trade and other receivables
The Company’s exposure to credit risk is influenced mainly by the individual characteristics of each
customer. However, management also considers the factors that may influence the credit risk of its
customer base, including the default risk of the industry and country in which customers operate
including the past trends on recoverability, expected credit losses (ECL) Provision is considered based
on the matrix defined below.
The Company has established a credit policy under which each customer is analysed individually for
creditworthiness before the Company’s credit terms are offered. Credit risk is managed through credit
approvals, establishing credit limits and continuously monitoring the creditworthiness of customers to
which the Company grants credit terms in the normal course of business. Credit limits are established for
each customer and reviewed periodically. Any sales order exceeding those limits require approval from
the appropriate authority.
There is one customer having revenue of ' 25,561 (March 31, 2025'35,401) including an amount of '
23,360, ' 2,179 and ' 22 (March 31, 2025'7,426, ' 27,975 and ' Nil) arising from shipments to United
States of America, Japan and Thailand respectively.
The concentration of credit risk is limited in domestic market due to the fact that the customer base
is large and unrelated. The Company’s exports are mainly carried out in countries which have stable
economic conditions, where the concentration is relatively higher, however the credit risk is low as the
customers have good credit ratings.
TheCompanycomputesanallowanceforimpairmentoftradereceivablesbasedonasimplifiedapproach,that
represents its expected credit losses. The Company uses an allowance matrix to measure the expected credit
loss of trade receivables. Loss rates are based on actual credit loss experienced over the past 3 years. These
loss rates are adjusted by considering the available, reasonable and supportive forward looking information.
The following table provides information about the exposure to credit risk and expected credit loss at
the end of the year for both trade receivables and interest & other charges recoverable from customers
under the simplified approach:
The exposure to credit risk and expected credit loss on contract assets as at March 31, 2026 and March
31, 2025 is insignificant and hence no loss allowance has been made.
Cash and cash equivalents, deposits with banks, mutual funds and other financial instruments
Credit risk from balances with banks and other financial instruments (including derivative financial
instruments) is managed by Company in accordance with its policy. Investments of surplus funds are made
only with approved counterparties and within credit limits assigned to each counterparty. Counterparty
credit limits are reviewed by the management and may be updated throughout the year. Company also
invests in mutual funds based on the credit ratings, these are reviewed for safety, liquidity and yield on
regular basis.
Accordingly, based on the assessment there is no material allowance in the above financial assets.
Exposure to credit risk:
The gross carrying amount of financial assets and contract assets, net of impairment losses recognised
represent the maximum credit exposure.
Liquidity risk is the risk that the Company will encounter difficulty in meeting the obligations associated with
its financial liabilities that are settled by delivering cash or another financial asset. The Company’s approach
to managing liquidity is to ensure, as far as possible, that it will have sufficient liquidity to meet its liabilities
when they are due, under both normal and stressed conditions, without incurring unacceptable losses or
risking damage to the Company’s reputation. Due to the dynamic nature of underlying businesses, the
Company maintains flexibility in funding by maintaining availability under committed credit lines.
Management monitors rolling forecast of the Company’s liquidity position (comprising the undrawn
borrowing facilities below) and cash and cash equivalents on the basis of expected cash flows. 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.
As disclosed in note 14(a), the Company has entered into a supplier financing arrangement. This has
improved the Company’s working capital. The Company has no significant concentration of liquidity risk
with any individual finance provider.
Market risk is the risk that changes in market prices - such as foreign exchange rates, interest rates and
equity prices - will affect the Company’s income or the value of its holdings of financial instruments. The
objective of market risk management is to manage and control market risk exposures within acceptable
parameters while optimising the return.
The Company is exposed to market risk primarily related to foreign exchange rate risk (currency risk),
interest rate risk and market value of its investments.
Foreign Currency risk
The company is exposed to foreign currency risk arising from foreign currency transactions, primarily
with respect to the US$ and Euro. Foreign currency risk arises from future commercial transactions
and recognised assets and liabilities denominated in a currency that is not the Company’s functional
currency (' ). The Company uses forward exchange contracts to hedge its currency risk and are used
exclusively for hedging purposes and not for trading and speculative purposes. These forward exchange
contracts, carried at fair value, may have varied maturities depending upon the primary host contract
requirement and risk management strategy of the Company. The objective of the hedges is to minimise
the volatility of the Indian rupee cash flows of highly probable forecast transactions.
The company’s risk management policy is to hedge around 50% to 100% of the net exposure with
forward exchange contracts. The remaining exposure is kept to an acceptable level by buying or selling
foreign currencies at spot rates when necessary to address short term requirements. Hedging decisions
are based on rolling forex cash flow statement prepared and reviewed on a monthly basis. Such contracts
are designated as cash flow hedges.
The foreign exchange forward contracts are denominated in the same currency as the highly probable
future sales transaction, therefore the hedge ratio is 1:1. The Company’s hedge policy allows for effective
hedge relationships to be established. Hedge effectiveness is determined at the inception of the hedge
relationship and through periodic prospective assessments to ensure that an economic relationship exists
between the hedged item and the hedging instrument. The Company enters into hedging instruments
where the critical terms of hedging instrument are aligned with terms of the hedged item.
Ineffectiveness is recognised on a cash flow hedge where the cumulative change in the value of the
hedging instruments exceeds on an absolute basis the change in the value of the hedged item attributable
to the hedged risk. Hedge ineffectiveness may arise due to the following:
- the critical terms of the hedging instrument and the hedged item differ (i.e. nominal amounts, timing
of the forecast transaction, interest resets changes from what was originally estimated), or
- differences arise between the credit risk inherent within the hedged item and the hedging instrument.
Sensitivity analysis
A reasonably possible strengthening (weakening) of foreign currency against the Indian rupee at March
31 would have affected the measurement of financial instruments denominated in foreign currencies
and affected equity and profit or loss by the amounts shown below. This analysis assumes that all other
variables, interest rates, remain constant and ignores any impact of forecast sales and purchases. Impact
of hedging, if any has not been considered here. A 5% increase or decrease is used when reporting
foreign currency risk internally to key management personnel and represents management’s assessment
of the reasonably possible change in foreign currency rate.
Interest rate risk
The Company’s main interest rate risk arises from investments that are primarily in fixed deposits which
are short term in nature and do not expose it to interest rate risk. The Company regularly evaluates the
interest rate hedging requirement to align with interest rate views and defined risk appetite, in order to
ensure most cost effective interest rate risk management.
Exposure to interest rate risk
The interest rate profile of the Company’s interest-bearing financial instruments as reported to the
management of the Company is as follows.
Fair value sensitivity analysis for fixed-rate instruments
The Company does not account for any fixed-rate financial assets or financial liabilities at fair value through
profit or loss. Therefore, a change in interest rates at the reporting date would not affect profit or loss.
Cash flow sensitivity analysis for variable-rate instruments
There are no variable rate instruments so no cash flow sensitivity analysis has been done.
iv) Price risk
The Company is exposed to price risk arising from its investments in mutual funds, which are classified
as Fair Value Through Profit and Loss (FVTPL) in the Balance Sheet. These investments are subject to
market price fluctuations, primarily driven by changes in interest rates, market yields and overall market
conditions, which may affect both the returns and the fair value of the investments. Company reviews
these mutual fund investments based on safety, liquidity and yield on regular basis.
(d) Sensitivity analysis
A reasonably possible strengthening (weakening) of foreign currency against the Indian Rupee at March
31 would have affected the measurement of foreign forward exchange contract designated as cash flow
hedges and affected equity and profit or loss by the amounts shown below. This analysis assumes that
all other variables, in particular interest rates, remain constant and ignores any impact of forecast sales
and purchases. A 5% increase or decrease is used when reporting foreign currency risk internally to key
management personnel and represents management’s assessment of the reasonably possible change
in foreign currency rate.
39 Capital Management
The Company policy is to maintain a strong capital base so as to maintain investor, creditor and market
confidence and to sustain future development of the business. The primary objective of the Group’s Capital
management is to maximise shareholder’s value. The Group manages its capital and makes adjustment to it
in light of the changes in economic and market conditions.
The Company manages capital using gearing ratio, which is total debt divided by total equity. The gearing
ratio at the end of the reporting period was as follows:
(ii) Details of Benami property:
No proceedings have been initiated or are pending against the Company for holding any Benami property
under the Benami Transactions (Prohibition) Act, 1988 (45 of 1988) and the rules made thereunder.
(iii) Utilisation of borrowed funds and share premium:
The Company has advanced or loaned or invested funds to following entities 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
Relevant provisions of the Foreign Exchange Management Act, 1999 (42 of 1999) and Companies Act
has been complied with for such transactions and the transactions are not violative of the Prevention of
Money-Laundering Act, 2002 (15 of 2003)
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:
(a) Directly or indirectly lend or invest in other persons or entities identified in any manner whatsoever by
or on behalf of the funding part (Ultimate beneficiaries) or
(b) Provide any guarantee, security or the like to or on behalf of the ultimate beneficiaries
(iv) Compliance with number of layers of companies: The Company has complied with the number
of layers prescribed under the Companies Act, 2013.
(v) Compliance with approved scheme(s) of arrangements: The Company has not entered into a
scheme of arrangement during the year
(vi) Undisclosed income: There is no income surrendered or disclosed as income during the current or
previous year in the tax assessments under the Income Tax Act, 1961, that has not been recorded in the
books of account.
(vii ) Details of crypto currency or virtual currency: The Company has not traded or invested in crypto
currency or virtual currency during the current or previous year.
(viii) Valuation of PP&E, intangible asset and investment property: The Company has not revalued
its property, plant and equipment (including right-of-use assets) or intangible assets or both during the
current or previous year.
(ix) As at March 31, 2026 , the Company has not granted any loans or advances in the nature of Loans to
the promoters, directors, KMPs and the related parties (as defined under Companies Act, 2013), either
severally or jointly with any other person which are repayable on demand or without specifying any terms
or period of repayment (March 31, 2025: Nil).
(x) The Company has not been declared as a Wilful Defaulter by any bank or financial institution or government
or any government authority.
(xi) Details of loans given, investment made and guarantee given covered under section 186(4) of the
Companies Act, 2013:
a) Details of investments and loans are given in Note 7 (a) and 7 (c) respectively.
b) The purpose of above loans and investment is for Acquisition of entities, Capital assets, Working capital
or any other purpose.
(xii) Title deeds of immovable properties held in name of the Company: The title deeds of all the
immovable properties (other than properties where the Company is the lessee and the lease agreements
are duly executed in favour of the lessee) are held in the name of the Company. Refer note 4.
(xiii) Registration of charges or satisfaction with Registrar of Companies: There are no charges
or satisfaction which are yet to be registered with the Registrar of Companies beyond the statutory period.
42 The Company raised ' 20,000 Mn during the quarter ended September 30, 2020 through Qualified
Institutional Placement (QIP) of equity shares. Out of the funds received of ' 19,750 Mn (net of expense of
250 Mn), the Company invested 18,419 Mn in its subsidiaries and ' 1,331 Mn towards capital expenditure,
thereby the entire QIP funds have been utilised during the year.
43 The goodwill on Isagro is tested for impairment annually. The recoverable amount of Goodwill has
been determined from a value in use calculation which require the use of assumptions. The value in use
calculation uses cash flow forecasts based on the most recently approved financial budgets and business
projections by the management, which cover a period of five years. Key assumptions underlying the value
in use calculation are those regarding expected revenues, a post-tax discount rate of 16% per annum. Sales
growth projections considers managements’ expectation of market development, current industry trends
and post-tax discount rate based on the relevant risks. 4% growth rate has been used to extrapolate the
cash flow projections beyond the five-year period of the approved financial budgets. The management
believes that any reasonably possible change in the key assumptions would not cause the carrying amount
to exceed the recoverable amount of the cash generating unit.
44 As at March 31, 2026, investments in equity shares of PI Management Consultancies LLC, amounting to
' 5,579 and consolidated accumulated losses as at March 31, 2026 amounting to ' 1,314. Management
periodically assesses whether there is any indication that such investment may be impaired. For investments
where impairment indicators exist, management compares the carrying amount with the recoverable
amount. The recoverable amount is determined as the value in use of the investment, computed based
on discounted projected profitability of the underlying business. The value in use of PI Management
Consultancies LLC is primarily driven by its investment in PI AgSciences Limited, for which an independent
valuation has been obtained. As at the reporting date, the recoverable amount so determined exceeds
the carrying amount and accordingly, no adjustment to the carrying amount is required in the books
of account. For PI AgSciences Limited, key assumptions underlying the value in use calculation include
expected revenues and a post-tax discount rate of 14.5% per annum. Sales growth projections consider
management’s expectations of market development and current industry trends and the discount rate
reflects the relevant risks associated with the business. A terminal growth rate of 2.5% has been applied.
Management believes that any reasonably possible change in these key assumptions would not cause the
carrying amount to exceed the recoverable amount of the cash generating unit.
45 Intangible Assets under Development are tested for impairment annually. The recoverable amount is
determined from value in use computed based upon discounted projected profitability approved by the
management. As on the reporting date the recoverable amount, determined by independent valuer is more
than the carrying amount and accordingly no adjustments to the carrying amount is required in the books of
accounts. Key assumptions underlying the value in use calculation are those regarding expected revenues,
a post-tax discount rate of 15% to 17% per annum (March 31, 2025: 15% to 17%). The management believes
that any reasonably possible change in the key assumptions would not cause the carrying amount to
exceed the recoverable amount.
46 The Company has used accounting software for maintaining its books of account wherein the audit log
at the application level, will not get generated in case of modification, if any performed by the users with
certain specific privileged access. For such instances, we have disabled the specific privileged access for all
users, thereby the situation of users performing modifications at application level with no audit trail getting
generated, will not arise.
47 EVENTS AFTER REPORTING DATE
The Board of Directors in the meeting held on May 19, 2026 have recommended a final dividend of
' 10 per share for the year ended March 31, 2026 which is subject to the approval of shareholders in the
ensuing annual general meeting.
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