1.15 PROVISIONS AND CONTINGENCIES
A provision is recognised when there is a present legal or constructive obligation as a result of past event; it is
probable that an outflow of resources will be required to settle the obligation, and in respect of which a reliable
estimate can be made. These are reviewed at each balance sheet date and adjusted to reflect the current best
estimates.
Provisions for onerous contracts are recognized when the expected benefits to be derived by the Company from
a contract are lower than the unavoidable costs of meeting the future obligations under the contract.
A disclosure for contingent liabilities is made where there is a possible obligation or a present obligation that
may probably not require an outflow of resources or an obligation for which the future outcome cannot be
ascertained with reasonable certainty. When there is a possible or a present obligation where the likelihood of
outflow of resources is remote, no provision or disclosure is made.
Provisions for onerous contracts are recognized when the expected benefits to be derived by the Company from
a contract are lower than the unavoidable costs of meeting the future obligations under the contract.
If the effect of the time value of money is material, provisions are discounted using a current pre-tax rate that
reflects, when appropriate, the risks specific to the liability. When discounting is used, the increase in the
provision due to the passage of time is recognised as a finance cost.
1.16 CASH AND CASH EQUIVALENTS
Cash and Cash equivalents include cash and Cheque in hand, bank balances, demand deposits with banks and
other short-term highly liquid investments that are readily convertible to known amounts of cash & which are
subject to an insignificant risk of changes in value where original maturity is three months or less.
1.17 CASH FLOW STATEMENT
Cash flows are reported using the indirect method where by the profit before tax is adjusted for the effect of the
transactions of a non-cash nature, any deferrals or accruals of past and future operating cash receipts or
payments and items of income or expenses associated with investing or financing cash flows. The cash flows
from operating, investing and financing activities of the company are segregated.
1.18 BORROWING COST
General and specific borrowing costs that are directly attributable to the acquisition, construction or
production of qualifying assets are capitalized as a part of Cost of that assets, during the period till all the
activities necessary to prepare the Qualifying assets for its intended use or sale are complete during the period
of time that is required to complete and prepare the assets for its intended use or sale. Qualifying assets are
assets that necessarily take a substantial period of time to get ready for their intended use or sale.
Other borrowing costs are recognized as an expense in the period in which they are incurred.
1.19 EARNINGS PER SHARE
Basic EPS is arrived at based on net profit after tax available to equity shareholders to the weighted average
number of equity shares outstanding during the year.
The diluted EPS is calculated on the same basis as basic EPS, after adjusting for the effects of potential dilutive
equity shares unless impact is anti-dilutive.
1.20 SEGMENT REPORTING
Operating segments are reported in a manner consistent with the internal reporting provided to Chief
Operating Decision Maker (CODM). The Company has identified its Managing Director as CODM which assesses
the operational performance and position of the Company and makes strategic decisions.
1.21 RECENT ACCOUNTING PRONOUNCEMENTS
The 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. For the year ended March
31, 2025, MCA has notified Ind AS - 117 Insurance Contracts and amendments to Ind AS 116 - Leases, relating
to sale and leaseback transactions, applicable to the Company w.e.f. April 1, 2024. The Company has reviewed
the new pronouncements and based on its evaluation has determined that it does not have any significant
impact in its financial statements.
KEY SOURCES OF ESTIMATION UNCERTAINITY AND CRITICAL ACCOUNTING JUDGEMENTS:
In the course of applying the policies outlined in all notes under note 1, the Company is required to make
judgements, estimates and assumptions about the carrying amount of assets and liabilities that are not readily
apparent from other sources. The estimates and associated assumptions are based on historical experience and
other factors that are considered to be relevant. Actual results may differ from these estimates.
The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates
are recognized in the period in which the estimate is revised if the revision affects only that period, or in the
period of the revision and future period, if the revision affects current and future periods.
(A) Key sources of estimation uncertainty:
(i) Useful lives of property, plant and equipment:
The useful lives of property, plant and equipment are reviewed at least once a year. Such lives are
dependent upon an assessment of both the technical lives of the assets, and also their likely economic lives
based on various internal and external factors including relative efficiency, the operating conditions of the
asset, anticipated technological changes, historical trend of plant load factor, historical planned and
scheduled maintenance. It is possible that the estimates made based on existing experience are different
from the actual outcomes and could cause a material adjustment to the carrying amount of property, plant
and equipment.
(ii) Provisions and Contingencies:
In the normal course of business, contingent liabilities may arise from litigation and other claims against
the Company. Potential liabilities that are possible but not probable of crystallising or are very difficult to
quantify reliably are treated as contingent liabilities. Such liabilities are disclosed in the notes but are not
recognised.
(iii) Fair value measurements:
Some of the company’s assets and liabilities are measured at fair value for financial reporting purposes.
The management determines the appropriate valuation techniques and inputs for fair value
measurements. In estimating the fair value of an asset or a liability, the company uses market-observable
data to the extent it is available. Where Level 1 inputs are not available, the company engages third party
qualified valuers to perform the valuation. The management works closely with the qualified external
valuers to establish the appropriate valuation techniques and inputs to the model.
(iv) Income Taxes:
Significant judgements are involved in determining the provision for income taxes, including amount
expected to be paid/ recovered for uncertain tax positions. In assessing the realizability of deferred tax
assets arising from unused tax credits, the management considers convincing evidence about availability
of sufficient taxable income against which such unused tax credits can be utilized. The amount of the
deferred income tax assets considered realizable, however, could change if estimates of future taxable
income changes in the future.
(v) Defined benefit plans:
The present value of defined benefit obligations are determined using actuarial valuations. An actuarial
valuation involves making various assumptions that may differ from actual development in the future.
These include the determination of the discount rate, future salary escalations and mortality rates etc. Due
to the complexities involved in the valuation and its long term nature, a defined benefit obligation is highly
sensitive to changes in these assumptions. All assumptions are reviewed at each reporting date.
(vi) Expected credit loss:
The measurement of expected credit loss on financial assets is based on the evaluation of collectability and
the management's judgement considering external and internal sources of information. A considerable
amount of judgement is required in assessing the ultimate realization of the loans having regard to, the
past collection history of each party and ongoing dealings with these parties, and assessment of their
ability to pay the debt on designated dates.
(B) Critical judgements in applying accounting policies:
The management has reviewed all the transactions and not found any material changes in preparation of
financial statements in accordance with Ind AS as notified.
Security Clause:
a) Cash Credit Loan from a Bank is secured by a charge on the current assets of the Company, hypothecation of existing
plant and machinery and equitable mortgage of Land & Building of the Company. Further, the Cash Credit Loan is
personally guaranted by Managing Director.
b) There were no material differences between the books of account and the stock statements submitted by the Company
to the bank in relation to the aforesaid working capital limits.
The Company uses the following hierarchy for determining and disclosing the fair value of financial instruments by valuation technique:
Level 1: Quoted (unadjusted) prices in active markets for identical assets or liabilities.
Level 2: Other techniques for which all inputs which have a significant effect on the recorded fair value are observable, either directly or indirectly.
Level 3: Techniques which use inputs that have a significant effect on the recorded fair value that are not based on observable market data.
Financial risk management objectives and policies
The Company's financial risk management is an integral part of how to plan and execute its business strategies. The Company's activity expose it to market risk, liquidity risk, commodity risk and credit risk.
In order to minimise any adverse effects on the financial performance of the Company, the Company evaluates various options. The Company's financial risk management policy is set by the Managing
Director and governed by overall direction of Board of Directors of the Company.
Market risk is the risk of loss of future earnings, fair values or future cash flows that may result from a change in the price of a financial instrument. The value of a financial instrument may change as a result
of changes in the interest rates, foreign currency exchange rates, equity prices and other market changes that affect market risk sensitive instruments. Market risk is attributable to all market risk sensitive
financial instruments including investments and deposits , foreign currency receivables, payables and loans and borrowings.
A. CREDIT RISK
Credit risk arises from the possibility that the counter party may not be able to settle their obligations as agreed. To manage this, the Company periodically assess financial reliability of customers, taking into
account the financial condition, current economic trends, and analysis of historical bad debts and ageing of accounts receivable. Individual risk limits are set accordingly.
The Company considers the probability of default upon initial recognition of asset and whether there has been a significant increase in credit risk on an ongoing basis through each reporting period. To
assess whether there is a significant increase in credit risk the Company compares the risk of default occurring on asset as at the reporting date with the risk of default as at the date of initial recognition. It
considers reasonable and supportive forwarding-looking information such as:
i) Actual or expected significant adverse changes in business
ii) Actual or expected significant changes in the operating results of the counterparty
iii) Financial or economic conditions that are expected to cause a significant change to the counterparty's ability to meet its obligations
iv) Significant increase in credit risk on other financial instruments of the same counterparty
(a) Principal Raw Material for Company's products is variety of plastic polymers which are primarily derivatives of Crude Oil. Company sources its raw material requirement from across the globe. Domestic
market prices are also generally remain in sync with international market price scenario.
(b) Volatility in Crude Oil prices, Currency fluctuation of Rupee vis-a-vis other prominent currencies coupled with demand-supply scenario in the world market affect the effective price and availability of
polymers for the Company. Company effectively manages deals with availability of material as well as price volatility through:
1. Widening its sourcing base
2. Appropriate contracts and commitments
3. Well planned procurement & inventory strategy and
4. Prudent hedging policy on foreign currency exposure
Risk committee of the Company comprising members from Board of Directors and operations has developed and enacted a risk management strategy regarding commodity Price risk and its mitigation.
29 Capital risk management
A The Company's objectives when managing capital are to
♦ safeguard their ability to continue as a going concern, so that they can continue to provide returns for shareholders and benefits for other stakeholders
♦ maintain an optimal capital structure to reduce the cost of capital
33 DISCLOSURE ON RELATED PARTY TRANSACTIONS
Names of related parties with whom the Company has entered into transactions during the year and description of relationship:
(i) Enterprises having Common Key Managerial Personnel ('KMP')
M/s. Chetanya Securities Private Limited (A Company in which Mr. Prem Chand Kankaria is a Director)
M/s. Highline Finance and Investmenrts Private Limited (A Company in which Ms. Neepa Kankaria is a Director )
(ii) Key Managerial Personnel:
Prem Chand Kankaria, Managing Director
Neepa Kankaria, Whole Time Director
M. Narsimha, Chief Financial Officer
Khushboo Joshi, Company Secretary ( upto 14th February, 2025)
K Swarupa Rani, Company Secretary ( with effect from 1st March, 2025)
a) No amounts in respect of related parties have been written off/ written back during the year or has not made any provision been made for
doubtful debts / receivable.
b) Figures in brackets relate to Previous Year
c) Terms and Conditions for sales and purchases: All sale and purchase transactions with the related parties are in the ordinary course of
business based on normal commercial terms, conditions and market rates with the related parties. For the year ended 31st March, 2025, the
Company has not recorded any loss allowances for the transaction between the related parties.
d) All the material transactions stated above with related parties are on arms length basis.
34 Based on the "Management Approach" as defined in Ind AS 108 - Operating Segments, the Company operates in Plastic Films and has its
production facilities and all other assets located in India and as such has only a Single Reportable Business Segment. The Company does not
have any sales outside India.
35 The title in respect of self-constructed buildings and title deeds of all other immovable properties, disclosed in the financial statements included
under Property, Plant and Equipment are held in the name of the Company as at the balance sheet date.
36 The Company has not provided any loans or advances to above specified persons.
37 The Company does not hold any Benami property. No proceedings have been initiated or pending against the Company for holding any
Benami property.
38 The Company has not been declared a wilful defaulter (as defined by RBI Circular) by any bank or financial Institution or other lender.
39 The Company did not have any transactions with companies struck off under Section 248 of the Companies Act, 2013 or Section 560 of Companies Act, 1956,
during the year.
40 The Company does not have any charges or satisfaction which is yet to be registered with ROC beyond the statutory period.
41 The Company does not have any subsidiary. Hence, the provisions of clause (87) of Section 2 of the Act read with the Companies (Restriction on number of
Layers) Rules, 2017 are not applicable to the Company
42 The Company has not entered into any scheme of arrangement during the year and the previous year.
43 Utilisation of Borrowed funds and share premium:
(i) The Company has 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
(ii) 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 Party (Ultimate
Beneficiaries) or
(b) provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries.
45 The Company does not have any undisclosed income that has been surrendered or disclosed as income during the year (previous 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.
46 The provisions specified under Section 135 of the Act are not applicable to the Company for the current financial year.
47 The Company has not traded or invested in Crypto currency or Virtual Currency during the financial year.
48 Previous year's figures have been re-grouped/re-classified wherever required to conform to current year's classification. All figures of financials has
been rounded to nearest lacs of rupees.
Signatures to Note 1 to 48
For and on behalf of the Board
Prem Chand Kankaria Neepa Kankaria
Managing Director Director
DIN: 00062584 DIN: 06637083
M. Narsimha K Swarupa Rani
Chief Financial Company Secetary
Officer M. No. A73047
Place: Hyderabad
Date: 24.05.2025
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