3.5 Provisions
A provisionis recognizedif, 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 benefits
will be required to settle the obligation. Provisions
are determined by discounting the expected
future cash flows (representing the best estimate
of the expenditure required to settle the present
obligation at the balance sheet date) at a pre-tax
rate that reflects current market assessments
of the time value of money and the risks specific
to the liability. The unwinding of the discount
is recognized as finance cost. Expected future
operating losses are not provided for.
A contract is considered to be onerous when the
expected economic benefits to be derived by the
Company from the contract are lower than the
unavoidable cost of meeting its obligations under
the contract. The provision for an onerous contract
is measured at the present value of the lower of the
expected cost of terminating the contract and the
expected net cost of continuing with the contract.
Before such a provision is made, the Company
recognizes any impairment loss on the assets
associated with that contract.
3.6 Revenue
i) Sale of products
Revenue on sale of vehicles, spare parts and
accessories is recognised when the control over
the goods or services is transferred to the customer
and is accounted net of goods and service tax
and discounts, if any. Revenues are recognised
when collectability of the resulting receivable is
reasonably assured.
The Company generates revenue from sale of
vehicles, services, spare parts and accessories
and other operating avenues. Under Ind AS 115,
revenue is recognised when a customer obtains
control of the goods or services. Invoices are due
as and when presented to the customer.
A contract liability is the obligation to transfer
goods or services to a customer for which the
Company has received consideration (or an amount
of consideration is due) from the customer. If a
customer pays consideration before the Company
transfers goods or services to the customer, a
contract liability is recognised when the payment is
made or the payment is due (whichever is earlier).
Contract liabilities are recognised as revenue when
the Company performs its obligation under the
contract.
ii) Rendering of services
Revenues from services including income from
driving school are recognised when services are
rendered and related costs are incurred.
iii) Commission, discount and incentive income
Commission income is recognised when services
are rendered and in accordance with the
commission agreements.
Discounts and incentive income is recognised
when the services are rendered and as per the
relevant scheme/ arrangement provided by the
manufacturer. In respect of other heads of income,
the Company follows the practice of recognising
income on an accrual basis.
iv) Other Income
In calculating the interest income, the effective
interest rate is applied to the gross carrying
amount of the assets (when the assets is not
credit impaired). Dividend income is recognized
in the standalone statement of profit and loss on
the date on which the right to receive payment is
established.
3.7 Inventories
Inventories are carried at lower of cost and net
realisable value. Cost comprises purchase price,
cost of refurbishment in case of used vehicles
and other costs incurred in bringing the inventory
to its present location and condition. The cost is
calculated on specific identification basis.
Net realizable value is the estimated selling price in
the ordinary course of business. The comparison of
cost and net realisable value of inventory is made
on an item by item basis.
The provision for inventory obsolescence is
assessed annually and is provided as considered
necessary.
3.8 Financial instruments
i) Recognition and initial measurement
n
j Trade receivables and debt securities issued are
initially recognized when they are originated. All
other financial assets and financial liabilities are
initially recognised when the Company becomes
a party to the contractual provisions of the
instrument. A trade receivable without a significant
financing component is initially measured at the
transaction price.
T3
3 A financial asset (unless it is a trade receivable
without a significant financing component) or
financial liability is initially measured at fair value
plus, for an item not at fair value through profit and
loss (FVTPL), transaction costs that are directly
attributable to its acquisition or issue.
i) Classification and subsequent measurement
Financial assets
On initial recognition, a financial asset is classified
as measured at either at amortized cost, FVTPL or
fair value in other comprehensive income (FVOCI).
Financial assets are not reclassified subsequent to
their initial recognition, except if and in the period
the Company changes its business model for
managing financial assets.
A financial asset is measured at amortized cost if
it meets both of the following conditions and is not
designated as at FVTPL:
- the asset is held within a business model
whose objective is to hold assets to collect
contractual cash flows; and
- the contractual terms of the financial asset
give rise on specified dates to cash flows that
are solely payments of principal and interest
on the principal amount outstanding.
On initial recognition of an equity investment
that is not held for trading, the Company may
irrevocably elect to present subsequent changes
in the investment's fair value in OCI (designated as
FVOCI - equity investment). This election is made
on an investment by investment basis.
All financial assets not classified as measured at
amortized cost or FVOCI as described above are
measured at FVTPL. This includes all derivative
financial assets. On initial recognition, the Company
may irrevocably designate a financial asset that
otherwise meets the requirements to be measured
at amortized cost or at FVOCI as at FVTPL if doing
so eliminates or significantly reduces an accounting
mismatch that would otherwise arise.
Financial assets: Business model assessment
The Company makes an assessment of the
objective of the business model in which a financial
asset is held at investment level because this
best reflects the way the business is managed
and information is provided to management. The
information considered includes:
- the stated policies and objectives for each of
such investments and the operation of those
policies in practice.
- the risks that affect the performance of the
business model (and the financial assets held
within that business model) and how those
risks are managed;
- the frequency, volume and timing of sales of
financial assets in prior periods, the reasons
for such sales and expectations about future
sales activity.
Transfers of financial assets to third parties in
transactions that do not qualify for derecognition
are not considered sales for this purpose, consistent
with the Company's continuing recognition of the
assets.
Financial assets that are held for trading or are
managed and whose performance is evaluated on
a fair value basis are measured at FVTPL.
Financial assets: Assessment whether contractual
cash flows are solely payments of principal and
interest
For the purposes of this assessment, 'principal'
is defined as the fair value of the financial asset
on initial recognition. 'Interest' is defined as
consideration for the time value of money and for
the credit risk associated with the principal amount
outstanding during a particular period of time and
for other basic lending risks and costs (e.g. liquidity
risk and administrative costs), as well as a profit
margin.
In assessing whether the contractual cash flows
are solely payments of principal and interest, the
Company considers the contractual terms of the
instrument. This includes assessing whether the
financial asset contains a contractual term that
could change the timing or amount of contractual
cash flows such that it would not meet this
condition. In making this assessment, the Company
considers:
- contingent events that would change the
amount or timing of cash flows;
- terms that may adjust the contractual coupon
rate, including variable interest rate features;
- prepayment and extension features; and
- terms that limit the Company's claim to
cash flows from specified assets (e.g. non¬
recourse features).
Financial assets: Subsequent measurement and
gains and losses
Financial liabilities: Classification, subsequent
measurement and gains and losses
Financial liabilities are classified as measured
at amortized cost or FVTPL. A financial liability
is classified as at FVTPL if it is classified as held
for trading, or it is a derivative or it is designated
as such on initial recognition. Financial liabilities
at FVTPL are measured at fair value and net
gains and losses, including any interest expense,
are recognized in profit or loss. Other financial
liabilities are subsequently measured at amortized
cost using the effective interest method. Interest
expense and foreign exchange gains and losses
are recognized in profit or loss. Any gain or loss on
de recognition is also recognized in profit or loss.
iii) De recognition
Financial assets
The Company derecognizes a financial asset when
the contractual rights to the cash flows from the
financial asset expire, or it transfers the rights to
receive the contractual cash flows in a transaction
in which substantially all of the risks and rewards
of ownership of the financial asset are transferred
or in which the Company neither transfers nor
retains substantially all of the risks and rewards
of ownership and does not retain control of the
financial asset.
If the Company enters into transactions whereby it
transfers assets recognized on its balance sheet,
but retains either all or substantially all of the
risks and rewards of the transferred assets, the
transferred assets are not derecognized.
Financial liabilities
The Company derecognizes a financial liability
when its contractual obligations are discharged or
cancelled, or expire.
The Company also derecognizes a financial
liability when its terms are modified and the cash
flows under the modified terms are substantially
different. In this case, a new financial liability based
on the modified terms is recognized at fair value.
The difference between the carrying amount of the
financial liability extinguished and the new financial
liability with modified terms is recognized in profit
or loss.
iv) Off setting
Financial assets and financial liabilities are offset
and the net amount presented in the balance sheet
when, and only when, the Company currently has
a legally enforceable right to set off the amounts
and it intends either to settle them on a net basis
or to realize the asset and settle the liability
simultaneously.
3.9 Impairment
i) Impairment of financial instruments
The Company recognizes loss allowances
for expected credit losses on financial assets
measured at amortized cost.
At each reporting date, the Company assesses
whether financial assets carried at amortized cost
are credit impaired. A financial asset is 'credit
impaired' when one or more events that have a
detrimental impact on the estimated future cash
flows of the financial asset have occurred.
oi
| Loss allowances for trade receivables are always
measured at an amount equal to lifetime expected
credit losses. Lifetime expected credit losses are
the expected credit losses that result from all
possible default events over the expected life of a
financial instrument.
c
fD
In all cases, the maximum period considered when
estimating expected credit losses is the maximum
contractual period over which the Company is
exposed to credit risk.
fD
^ Measurement of expected credit losses
o
=>- Expected credit losses are a probability weighted
estimate of credit losses. Credit losses are
measured as the present value of all cash shortfalls
(i.e. the difference between the cash flows due
to the Company in accordance with the contract
and the cash flows that the Company expects to
receive).
Presentation of allowance for expected credit
losses in the standalone balance sheet
Loss allowances for financial assets measured
at amortized cost are deducted from the gross
carrying amount of the assets.
Write-off
The gross carrying amount of a financial asset is
written off (either partially or in full) to the extent
that there is no realistic prospect of recovery.
This is generally the case when the Company
determines that the debtor does not have assets
or sources of income that could generate sufficient
cash flows to repay the amounts subject to the
write off.
i) Impairment of non- financial assets
The Company's non-financial assets, other than
inventories and deferred tax assets, are reviewed
at each reporting date to determine whether
there is any indication of impairment. If any such
indication exists, then the asset's recoverable
amount is estimated.
For impairment testing, assets that do not
generate independent cash inflows are grouped
together into cash-generating units (CGUs). Each
CGU represents the smallest group of assets that
generates cash inflows that are largely independent
of the cash inflows of other assets or CGUs.
The recoverable amount of a CGU (or an individual
asset) is the higher of its value in use and its fair
value less costs to sell. Value in use is based on the
estimated future cash flows, 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 CGU
(or the asset).
An impairment loss is recognized if the carrying
amount of an asset or CGU exceeds its estimated
recoverable amount. Impairment losses are
recognized in profit or loss.
In respect of assets for which impairment loss has
been recognized in prior periods, the Company
reviews at each reporting date whether there is
any indication that the loss has decreased or no
longer exists. An impairment loss is reversed if
there has been a change in the estimates used to
determine the recoverable amount. Such a reversal
is made only to the extent that the asset's carrying
amount does not exceed the carrying amount that
would have been determined, net of depreciation
or amortization, if no impairment loss had been
recognized.
3.10 Leases
i. Determining whether an arrangement contains a
lease
At inception of an arrangement, it is determined
whether the arrangement is or contains a lease. At
inception or on reassessment of the arrangement
that contains a lease, the payments and other
consideration required by such an arrangement
are separated into those for the lease and those
for other elements on the basis of their relative fair
values.
ii. Company as a lessee
The Company accounts for each lease component
within the contract as a lease separately from non¬
lease components of the contract and allocates
the consideration in the contract to each lease
component on the basis of the relative stand-alone
price of the lease component and the aggregate
stand-alone price of the non-lease components.
The Company recognises right-of-use asset
representing its right to use the underlying asset
for the lease term at the lease commencement
date. The cost of the right-of-use asset measured
at inception shall comprise of the amount of
the initial measurement of the lease liability
adjusted for any lease payments made at or
before the commencement date less any lease
incentives received, plus any initial direct costs
incurred and an estimate of costs to be incurred
by the lessee in dismantling and removing the
underlying asset or restoring the underlying
asset or site on which it is located. The right-of-
use assets is subsequently measured at cost
less any accumulated depreciation, accumulated
impairment losses, if any and adjusted for any
remeasurement of the lease liability. The right-of-
use assets is depreciated using the straight-line
method from the commencement date over the
shorter of lease term or useful life of right-of-use
asset. The estimated useful lives of right-of-use
assets are determined on the same basis as those
of property, plant and equipment. Right-of-use
assets are tested for impairment whenever there
is any indication that their carrying amounts may
not be recoverable. Impairment loss, if any, is
recognised in the standalone statement of profit
and loss.
The Company measures the lease liability at
the present value of the lease payments that
are not paid at the commencement date of the
lease. The lease payments are discounted using
the interest rate implicit in the lease, if that rate
can be readily determined. If that rate cannot be
readily determined, the Company uses incremental
borrowing rate. The lease payments shall include
fixed payments, variable lease payments, residual
value guarantees, exercise price of a purchase
option where the Company is reasonably certain to
exercise that option and payments of penalties for
terminating the lease, if the lease term reflects the
lessee exercising an option to terminate the lease.
The lease liability is subsequently remeasured by
increasing the carrying amount to reflect interest on
the lease liability, reducing the carrying amount to
reflect the lease payments made and remeasuring
the carrying amount to reflect any reassessment
or lease modifications or to reflect revised in¬
substance fixed lease payments. The Company
recognises the amount of the re-measurement of
lease liability due to modification as an adjustment
to the right-of-use asset and standalone statement
of profit and loss depending upon the nature of
modification. Where the carrying amount of the
right-of-use asset is reduced to zero and there is a
further reduction in the measurement of the lease
liability, the Company recognises any remaining
amount of the re-measurement in standalone
statement of profit and loss.
The Company has elected not to apply the
requirements of Ind AS 116 Leases to short-term
leases of all assets that have a lease term of 12
months or less. The lease payments associated
with these leases are recognized as an expense on
a straight-line basis over the lease term.
iii. Company as a lessor
At the inception of the lease the Company
classifies each of its leases as either an operating
lease or a finance lease. The Company recognises
lease payments received under operating leases
as income on a straight- line basis over the lease
term. In case of a finance lease, finance income is
recognised over the lease term based on a pattern
reflecting a constant periodic rate of return on
the lessor's net investment in the lease. When the
Company is an intermediate lessor it accounts for
its interests in the head lease and the sub-lease
separately. It assesses the lease classification of a
sub-lease with reference to the right-of-use asset
arising from the head lease, not with reference to
the underlying asset. If a head lease is a short term
lease to which the Company applies the exemption
described above, then it classifies the sub-lease as
an operating lease.
If an arrangement contains lease and non-lease
components, the Company applies Ind AS 115
Revenue from contracts with customers to allocate
the consideration in the contract.
3.11 Recognition of interest income or interest
expense
Interest income or expense is recognized using the
effective interest method.
The 'effective interest rate' is the rate that exactly
discounts estimated future cash payments or
receipts through the expected life of the financial
instrument to the gross carrying amount of the
financial asset or the amortized cost of the financial
liability.
In calculating interest income and expense, the
effective interest rate is applied to the gross
carrying amount of the asset (when the asset is
not credit-impaired) or to the amortized cost of the
liability.
3.12 Income tax
Income tax comprises current and deferred tax. It
is recognized in profit or loss except to the extent
that it relates an item 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 and any adjustment to the tax payable or
receivable in respect of previous years. The amount
of current tax reflects the best estimate of the tax
amount expected to be paid or recoverable from
tax authorities after considering the uncertainty, if
any, related to income taxes. It is measured using
tax rates (and tax laws) enacted or substantively
enacted by the reporting date.
Current tax assets and current tax liabilities are
offset only if there is a legally enforceable right to
set off the recognised amounts, and it is intended
to realise the asset and settle the liability on a net
basis or simultaneously.
ii. Deferred tax
Deferred income tax assets and liabilities are
recognised in respect of temporary differences
between the carrying amounts of assets and
liabilities for financial reporting purposes and the
corresponding amounts used for taxation purposes.
Deferred tax is also recognised in respect of carried
forward tax losses and tax credits.
Deferred tax assets are recognised to the extent
it is probable that future taxable profits will be
available against which they can be used. The
existence of unused tax losses is strong evidence
that future taxable profit may not be available.
Therefore, in case of a history of recent losses, the
Company recognises a deferred tax asset only to
the extent that it has sufficient taxable temporary
differences or there is convincing other evidence
that sufficient taxable profit will be available
against which such deferred tax asset can be
realised. Deferred tax assets - unrecognised or
recognised, are reviewed at each reporting date
and are recognised/ reduced to the extent that it is
probable/ no longer probable respectively that the
related tax benefit will be realised.
Deferred tax is measured at the tax rates that are
expected to apply to the period when the asset is
realised or the liability is settled, based on the laws
that have been enacted or substantively enacted
by the reporting date.
The measurement of deferred tax assets and
liabilities reflects the tax consequences that would
follow from the manner in which the Company
expects, at the reporting date, to recover or settle
the carrying amount of its assets and liabilities.
Deferred tax assets and liabilities are offset if there
is a legally enforceable right to offset current tax
liabilities and assets, and they relate to income
taxes levied by the same tax authority on the same
taxable entity, or on different tax entities, but they
intend to settle current tax liabilities and assets on
a net basis or their tax assets and liabilities will be
realised simultaneously.
3.13 Borrowing cost
Borrowing costs are interest and other costs
(including exchange differences relating to foreign
currency borrowings to the extent that they are
regarded as an adjustment to interest costs)
incurred in connection with the borrowing of funds.
Borrowing costs directly attributable to acquisition
or construction of an asset which necessarily take
a substantial period of time to get ready for their
intended use are capitalized as part of the cost of
that asset. Other borrowing costs are recognized
as an expense in the period in which they are
incurred.
3.14 Earnings per share
The basic earnings per share is computed by
dividing the net profit after tax for the year
attributable to equity shareholders by the weighted
average number of equity shares outstanding
during the year.
The number of shares used in computing diluted
earnings per share comprises the weighted
average number of shares considered for deriving
basic earnings per share and also the weighted
average number of equity shares that could have
been issued on the conversion of all dilutive
potential equity shares. Dilutive potential equity
shares are deemed converted as of the beginning
of the period unless issued at a later date. In
computing dilutive earning per share, only potential
equity shares that are dilutive i.e. which reduces
earnings per share or increases loss per share are
included.
3.15 Cash-flow statement
Cash flows are reported using the indirect method,
whereby net profit before tax is adjusted for the
effects of transactions of a non-cash nature and
any deferrals or accruals of past or future cash
receipts or payments. The cash flows from regular
revenue generating, investing and financing
activities of the Company are segregated.
3.16 Cash and cash equivalents
Cash and cash equivalents comprise cash at bank
and on hand and short-term deposits with an
original maturity of three months or less which are
subject to insignificant risk of changes in value.
3.17 Contingent liabilities and assets
Contingent liabilities are disclosed 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 but is not recognized because
it is not probable that an outflow of resources
embodying economic benefits will be required to
settle the obligation or the amount of the obligation
cannot be measured with sufficient reliability. The
existence of a contingent liability is disclosed in the
notes to the standalone financial statements.
Contingent assets are neither recognised nor
disclosed.
3.18 Non-current assets classified as held for sale
Assets are classified as held for disposal and
stated at the lower of carrying amount and fair
value less costs to sell. To classify any Asset as
"Asset classified as held for sale" the asset must
be available for immediate sale and its sale must
be highly probable. Such assets or group of assets
are presented separately in the Balance Sheet, in
the line "Assets classified as held for sale". Once
classified as held for sale, intangible assets and
Property Plant Equipment are no longer amortised
or depreciated.
3.19 Recent accounting pronouncements
'Ministry of Corporate Affairs ("MCA") notifies
new standards or amendments to the existing
standards under Companies (Indian Accounting
Standards) Rules as issued from time to time.
There are no new standards or amendments to the
existing standards that are notified impacting the
standalone financial statements of the Company.
Details of claims against the Company
a) Pending resolution of the respective proceedings, it is not practicable for the Company to estimate the timing of
cash flows, if any, in respect of the above as it is determinable only on receipt of judgement/ decision pending
with various forums/ authorities. The Company has received all its pending litigations and proceedings and has
adequately provided for when provision is required and disclosed as contingent liabilities where applicable, in
the standalone financial statements. The Company does not expect the outcome of these proceedings to have
a materially adverse effect on its financial position.
b) There are certain claims raised by various customers, pending before various consumer forums. The management
does not expect the outcome of the action to have a material effect on its financial position.
c) On 28 February 2019, the Hon'ble Supreme Court of India has delivered a judgment clarifying the principles
that need to be applied in determining the components of salaries and wages on which Provident Fund (PF)
contributions need to be made by establishments. Basis this judgment, the Company has re-computed its
liability towards PF for the month of March 2019. In respect of the earlier periods/years, the Company has
been legally advised that there are numerous interpretative challenges on the application of the judgment
retrospectively. Based on such legal advice, the management believes that it is impracticable at this stage to
reliably measure the provision required, if any, and accordingly, no provision has been made towards the same.
Necessary adjustments, if any, will be made to the books as more clarity emerges on this subject.
29 Earnings per share
A. Basic earnings per share
The calculation of profit attributable to equity share holders and weighted average number of equity shares
outstanding for the purpose of basic earnings per share calculations are as follows:
31 Segment reporting
The Company has a single reportable business segment which is reviewed by Chief operating decision maker
('CODM'). The Company is engaged in the business of purchase and sale of vehicles and related services.
The entire operations are organised and managed as one organisational unit with the same set of risks and
returns, hence the same has been considered as representing a single primary segment. The Company renders
its services in India only and does not have any operations in economic environments with different risks and
returns; hence it is considered operating in a single geographic segment.The Company has no significant
customer whose carrying value exceeds 10% of the revenue from operations; hence no separate disclosure is
made on the same.
Accordingly, no segment disclosure has been made in these standalone financial statements.
32 Employee benefits
A Defined contribution plan
The Company makes contributions, determined as a specified percentage of employee salaries, in respect
of qualifying employees towards provident fund and other funds which are defined contribution plans. The
Company has no obligations other than to make the specified contributions. The contributions are charged to
the standalone statement of profit and loss as they accrue.
B Defined benefit plan
The Company operates certain post-employment defined benefit plan which is provided for based on actuarial
valuation carried out by an independent actuary using the projected unit credit method. The Company accrues
gratuity as per the provisions of the Payment of Gratuity Act, 1972 ('Gratuity Act').
The Gratuity Plan entitles an employee, who has rendered atleast five years of continuous service, to receive
one-half month's salary for each year of completed service (service of six months or above is rounded off to one
year) at the time of retirement/ exit, restricted to a sum of INR 2.00 million.
Based on an actuarial valuation obtained in this respect, the following table sets out the status of the benefit
plan and the amounts recognised in the Company's standalone financial statements as at balance sheet date:
Note 1:The Company has not disclosed the fair values for financial instruments such as cash and cash equivalents,
trade receivables, trade payables etc., because their carrying amounts are a reasonable approximation of fair value.
* Excludes investments in subsidiaries measured at cost.
Measurement of fair values
The fair value of the financial instruments is determined using discounted cash flow analysis. The discount rates used
is based on management estimates.
Level 1 fair values
Investment in equity shares that has a quoted price and which are actively traded on the stock exchanges. It is been
valued using the closing price as at the reporting period on the stock exchanges.
Level 2 fair values
Investment in mutual funds- is unquoted price and are observable for the asset or liability, either directly (i.e., as
prices) or indirectly (i.e.,derived from prices)
Level 3 fair values
If one or more of the significant inputs is not based on observable data, the instrument is included in level 3.
The quantitative sensitivity analysis of level 3 fair value of financial instrument as at 31 March 2025 and 31 March
2024 has not been disclosed as it is not material to the Company.
B Measurement of fair values
The following methods and assumptions were used to estimate the fair values:
The fair values of investments in mutual fund units is based on the net asset value ('NAV') as stated by the
issuers of these mutual fund units in the published statements as at balance sheet date. NAV represents the
price at which the issuer will issue further units of mutual fund and the price at which issuers will redeem such
units from the investors
C Financial risk management
The Company's activities expose it to a variety of financial risks: credit risk, liquidity risk and market risk.
i) Risk management framework
ii) 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 obligations, and arises principally from Company's receivables from customers, loans
and investment in mutual funds.
The Company is exposed to credit risk as a result of the risk of counterparties defaulting on their obligations.
The Company's exposure to credit risk primarily relates to investments, accounts receivable and cash and cash
equivalents. The Company monitors and limits its exposure to credit risk on a continuous basis. To manage
this the Company periodically reviews the financial reliability of its customers, taking into account the financial
condition, current economic trends and analysis of historical bad debts and ageing of accounts receivables. The
carrying amount of financial assets represents maximum credit risk exposure.
The Company establishes an allowance for credit loss that represents its estimate of expected losses in respect
of trade and other receivables based on the past and the recent collection trend. The maximum exposure to
the credit risk at the reporting date is primarily from trade receivables amounting to ? 694.27 million (31 March
2024: ? 894.40 million).
The Company has no significant customer whose carrying value exceeds 10% of the revenue from operations.
There is no significant concentration of credit risk.
The movement in allowance for credit loss in respect of financial assets during the year was as follows:
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 always have sufficient liquidity to meet its liabilities
when due, under both normal and stressed conditions, without incurring unacceptable losses or risking damage
to the Company's reputation.
The Company believes that the working capital is sufficient to meet its current requirements. Accordingly, no
liquidity risk is perceived.
The table below provides details regarding the undiscounted contractual maturities of significant financial
liabilities as of 31 March 2025:
iv) 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, such as foreign exchange rates, interest rates and equity prices.
Foreign currency risk
The Company is exposed to currency risk to the extent that there is a mismatch between the currencies in
which transactions are denominated and the functional currency of the Company. The functional currency of
the Company is INR and the Company does not have any material foreign currency transactions during the
years ended 31 March 2025 and 31 March 2024.
Cash flow and fair value interest rate risk
The Company's main interest rate risk arises from long-term borrowings with variable rates, which expose the
Company to cash flow interest rate risk. The interest rate on the Company's financial instruments is based on
market rates. The Company monitors the movement in interest rates on an ongoing basis.
(a) Interest rate risk exposure
The Company does not have any variable rate long term borrowings including current maturities as at current
year and previous year, and therefore no exposure of the Company's borrowing to interest rate changes at the
end of the year is expected.
The Company is obligated under cancellable operating leases for its certain office premises which are renewable
at the option of both the lessor and lessee. Total rental expenses under such leases amounted to ? 131.16 million
(31 March 2024: ? 123.68 million). These arrangements do not qualify as a lease as per the requirements of Ind
AS 116.
(b) Operating lease as a lessor
The Company has leased out building under operating lease. There is escalation and renewal clause in the lease
agreements and sub-letting is not permitted. The lease is cancellable and the total lease income recognised
during the year was ? 4.15 million (31 March 2024: ? 3.36 million).
35 Capital Management
The Company's policy is to maintain a stable capital base so as to maintain investor, creditor and market
confidence and to sustain future development of the business. Management monitors capital on the basis of
return on capital employed as well as the debt to total equity ratio. For the purpose of debt to total equity ratio,
debt considered is long-term and short-term borrowings. Total equity comprise of issued share capital and all
other equity reserves.
The Company evaluates events and transactions that occur subsequent to the balance sheet date but prior to
the approval of the standalone financial statements to determine the necessity for recognition and/or reporting
of subsequent events and transactions in the standalone financial statements. As of 29 May 2025 there are no
subsequent events and transactions to be recognised or reported that are not already disclosed.
39 Utilisation of IPO proceeds
During the year ended 31 March 2024, the Company had completed initial public offering (IPO) of ? 6,015.54
million (including fresh issue of ? 2,500 million) comprising of :
(i) 8,453,803 equity shares of ? 2 each at an issue price of ? 295 per share (including a share premium of ? 293
per share) towards fresh issue of equity shares
(ii) 11,917,075 equity shares of ? 2 each at an issue price of ? 295 per share (including a share premium of ? 293 per
share) towards offer for sale and ;
(iii) 22,950 equity shares of ? 2 each at an issue price of ? 267 per share (including a share premium of ? 265 per
share) for employee quota towards fresh issue.
The equity shares of the Company were listed on National Stock Exchange (NSE) and Bombay Stock Exchange (BSE)
on 19 March 2024.
The Company has estimated ? 421.06 million (including provision) (excluding taxes) as IPO related expenses
and allocated such expenses between the Company ? 178.01 million and selling shareholders ? 243.05 million in
proportion to the equity shares alloted to the public as fresh issue by the Company and under offer for sale by selling
shareholders respectively. The amount attributable to the Company amounting to ? 178.01 million has been adjusted
to securities premium for the year ended 31 March 2024, and further ? 2.45 million have been adjusted to securities
premium during the year ended 31 March 2025.
40 a) No funds 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,
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 provide any guarantee, security or the like on behalf of the
Ultimate Beneficiaries.
40 b) No funds 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, directly or
42 Additional regulatory information pursuant to the requirement in Division II of Schedule III to the Companies Act,
2013
i) The Company does not have any Benami property, where any proceeding has been initiated or pending against
the Company for holding any Benami property.
ii) The Company does not have any transactions with companies struck off.
iii) The Company has not revalued its property, plant and equipment ,right-of-use assets or intangible assets or
both during the current or previous year.
iv) The Company has not traded or invested in Crypto currency or Virtual Currency during the financial year.
v) The Company does not have any such transaction which is not recorded in the books of accounts that has been
surrendered or disclosed as income during the year in the tax assessments under the Income Tax Act, 1961.
vi) The Company has not been declared wilful defaulter by any bank or financial institution or government or any
government authority.
vii) The Company has complied with the number of layers prescribed under the Companies Act, 2013.
viii) The Company has not entered into any scheme of arrangement which has an accounting impact on current or
previous financial year.
(ix) The Company does not have any charges or satisfaction which is yet to be registered with ROC beyond the
statutory period.
As per our report of even date attached
for B S R & Associates LLP for and on behalf of the Board of Directors of
Chartered Accountants Popular Vehicles and Services Limited
Firm registration number: 116231W/ W-100024 CIN: U50102KL1983PLC003741
Vipin Lodha Naveen Philip Francis K Paul Raj Narayan
Partner Managing Director Whole Time Director Chief Executive Officer
Membership No.: 076806 DIN: 00018827 DIN: 00018825
Kochi John Verghese Varun T V
29 May 2025 Chief Financial Officer Company Secretary
Membership no. A22044
Kochi
29 May 2025
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