15.2 Terms/rights attached to class of shares
The Company has only one class of share referred to as equity shares having a par value of Rs. 10 each. The holders of equity shares are entitled to one vote per share. In the event of liquidation of the Company, the equity shareholders will be entitled to receive remaining assets of the Company, after distribution of all preferential amounts. The distribution will be in proportion to the number of equity shares held by the shareholders.
15.5 Share based payments
a) Description of Share based payment arrangements
The Company operates multiple Employee Stock Option Schemes (ESOS) i.e., ESOS 2022, ESOS 2014, ESOS 2013, ESOS 2009 (Plan A & Plan B), ESOS 2008, ESOS 2004, ESOS 2003 and ESOP 2000. These schemes are designed to attract, retain and motivate employees and align employee interests with shareholders.
Equity-settled share-based payments are measured at fair value at grant date and expensed over the vesting period. Options granted will generally vest over one to three years period, except for ESOS 2008 which has a vesting period of one to four years. The fair value of options has been estimated using Black-Scholes-Merton model, the results of which are sensitive to key assumptions including expected volatility, expected life and share price. Management has assessed that reasonable changes in these inputs would result in corresponding changes in the fair value of the options, with expected volatility and share price being the most significant drivers.
The share application money pending allotment as at March 31,2026 represents receipt pursuant to the exercise of Options under the Employee Stock Option Scheme(s) ESOS 2013, ESOS 2014 and ESOS 2022 of the Company. Under the said scheme, one share of Rs. 10 each, at a nil premium for 5,736 shares and at a premium of Rs. 150 for 3,814 shares needs to be issued for each option exercised. The shares need to be allotted within 60 days of receipt of exercise application along with remittance of exercise money and were allotted on Apr 29, 2026. No such application money has been pending beyond the stipulated time for allotment.
Nature and purpose of reserves Securities premium
Represents excess of share application money received over par value of shares and includes employee stock compensation costs accrued, to the extent they are exercised.
Employee stock options outstanding
Represents the fair value on grant date of the outstanding options issued to employees under various employees stock option schemes of the Company.
Retained earnings
Represents that portion of the net income/(loss) of the Company.
Currency translation reserve
Exchange differences relating to the translation of the results and net assets of the Company’s foreign operations from their functional currencies to the Company’s presentation currency (i.e., Currency Units) are recognized directly in other comprehensive income and accumulated in the foreign currency translation reserve. Exchange differences previously accumulated in the foreign currency translation reserve will be reclassified to profit or loss on the disposal of the foreign operation.
Fair value gain/(loss) on equity instruments through OCI
The Company has opted to recognize the changes in the fair value of certain investments in equity instruments and remeasurement of defined benefit obligations in OCI. The Company transfers amounts from this reserve to retained earnings in case of actuarial loss/gain and in case of fair value recognition of equity instrument, the same will be transferred when the respective equity instruments are derecognized.
17. FINANCIAL LIABILITIES 17.1 BORROWINGS
The Company had utilized cash credit facility from Axis Bank Limited for a period of one day (previous year availed Working Capital Demand Loan from Axis Bank Limited and Kotak Mahindra Bank Limited), which were repaid during the year. The interest rate on the borrowings during the year was 9.10% p.a. (PY ranged from 795% p.a. to 9.65% p.a.).
The borrowings as at the end of current and previous year were Nil.
Loans from Banks, secured
a. Borrowing facilities from Axis Bank Limited, ICICI Bank Limited and Kotak Mahindra Bank Limited are secured by pari-passu first charge on the current assets of the Company, both present and future.
b. With respect to the borrowings from banks on the basis of security, the periodical returns/statements filed by the Company with banks are in agreement with the books of accounts.
Loans from Banks, unsecured
a. Borrowing facilities from HSBC Bank - unutilised during the year as well as previous year.
b. Borrowing facilities from HDFC Bank Limited- unutilised during the year as well as previous year and closed in January 2026.
17.2 LEASES
The Company has adopted Ind AS 116 “Leases” with the date of initial application being April 01, 2019, using the modified retrospective approach. The Company has lease contracts for various items of Building, Land and Office equipments used in its operations. There are several lease contracts that include extension and termination options and variable lease payments.
18.2 Compensated absences
The Company provides for expenses towards compensated absences (leave encashment) provided to its employees. The expenses are recognized in the statement of profit and loss account and the liabilities are recognized at the present value of the amount payable determined based on an independent external actuarial valuation made as at each Balance Sheet date, using Projected Unit Credit method.
20.4 Ind AS 115 - revenue from contract with customers
The Company derives revenue from Software Solutions & Services. The accounting policies are mentioned in note no.6.a
1. Remaining performance obligations
The remaining performance obligation disclosure provides the aggregate amount of transaction price yet to be recognized as at the end of the reporting period and an explanation as to when the Company expects to recognize these amounts in revenue. Remaining performance obligation estimates are subject to change and are affected by various factors including termination, changes in scope of contracts, adjustments for revenue that are not materialized and adjustments for currency. Applying the practical expedient as given in Ind AS 115, the Company has not disclosed the following:
a) the remaining performance obligations for contracts where revenue recognized corresponds directly with the value to the customer of the entity’s performance completed to date including time and material, support service and subscription contracts and
b) the remaining performance obligations in respect of other contracts, since those performance obligations have an original expected duration of one year or less in most of the cases.
2. During the year ended March 31, the Company recognized revenue of Rs. 239.18 Mln. (PY Rs. 19772 Mln.) arising from opening unearned revenue of Rs. 296.62 Mln. (PY Rs. 264.78 Mln.) as at April 01.
3. During the year ended March 31, the Company recognized revenue of Rs. 100.91 Mln. (PY Rs. 11.01 Mln.) arising from advance from customers out of the opening advances of Rs. 112.73 Mln. (PY Rs. 21.52 Mln.) as at April 01.
4. Considering the form of engagement with customers and very strong inter despondencies between Parent and Subsidiaries, it is more appropriate for us to disclose the revenue from software services from fixed-price and time-and-material contracts at consolidated level. The percentage of revenue from software services from fixed-price contracts was 82% and 77% for each of the year ended March 31,2026 and March 31,2025, respectively, at a consolidated basis.
27 OTHER DISCLOSURES
No transactions to report against the following disclosure requirements as notified by MCA pursuant to amended Schedule III:
(a) Crypto currency or virtual currency.
(b) Benami property held under Prohibition of Benami Property Transactions Act, 1988 and rules made thereunder.
(c) Transactions with companies struck off under Section 248 of the Companies Act, 2013 or Section 560 of Companies Act, 1956 during the financial year.
(d) Relating to borrowed funds:
i. Wilful defaulter
ii. Discrepancy in utilization of borrowings
iii. Current maturity of long term borrowings
(e) Registration of charges or satisfaction with Registrar of Companies to be filed beyond the statutory period.
a) Details of undertaking given by the Company are given in the note no.32.
b) The above figures include Service Tax/VAT/CST/GST as applicable.
c) The transactions with related parties are at arm’s length basis. The outstanding balances are unsecured and interest free, except loan transactions. The Company has not recorded any impairment of receivables owed by related parties. Payment terms for related party transactions are generally less than 60 days, except in the case of overseas subsidiaries, from whom the receivables are realized within the prescribed period.
30. DISCLOSURE OF FAIR VALUE MEASUREMENTS
The fair values of financial assets and liabilities are determined at the amount at which the instrument could be exchanged in a current transaction between willing parties, other than in a forced or liquidation sale. Fair value of cash & cash equivalents, trade and other short term receivables, trade payables, borrowings and other financial instruments approximate their carrying amounts largely due to the short term maturities of these instruments.
Note: The Company is engaged in development of software products, which are marketed by the Company and its overseas subsidiaries. The intellectual property rights are held by the Company. There are in-built warranties for performance and support. Claims which may arise out of these are not quantifiable and hence not provided for.
The Company has undertaken to provide continued financial support to its subsidiaries, Ramco Systems Pte. Ltd., Singapore, Ramco Systems Australia Pty Ltd., Australia, Ramco Systems Sdn. Bhd., Malaysia, Ramco Software Japan Limited, Japan, Ramco Systems FZ-LLC, Dubai for their operations and have also undertaken to ensure the going concern status of above subsidiaries and also that of Ramco Systems Sdn. Bhd., Malaysia and Ramco Systems Australia Pty Ltd., Australia with respect to debt dues, if any, to Ramco Systems Ltd., Switzerland.
33. FINANCIAL RISK MANAGEMENT OBJECTIVES AND POLICIES
The Board of Directors has constituted a Risk Management committee, with responsibility including, formulation, monitoring and review of risk management policy, identification of risk mitigation measures and establishment of business continuity plan. The Company has already developed and implemented a risk management policy. The risk management systems are reviewed periodically. The Internal Audit reviews the risk management controls & procedures and reports to the Audit Committee.
The Company’s financial risks comprise of market risk, credit risk and liquidity risk.
A. Market risk
Market risk is the risk that the fair value of future cash flows of a financial instrument will fluctuate because of changes in market prices. Market risk comprises of two types of risk: interest rate risk and foreign currency risk.
A.1 Interest rate risk
The Company has borrowed debt at variable rates to finance its operations, which exposes it to interest rate risk. The Company's interest rate risk management planning includes achieving the lowest possible cost of debt financing, while managing volatility of interest rates, applying a prudent mix of fixed and floating debt. Interest rate risk exposure on the average borrowing for the year:
A.2 Foreign currency risk
Foreign currency risk is the risk that the fair value or future cash flows of an exposure will fluctuate because of changes in foreign exchange rates. The Company’s exposure to the risk of changes in foreign exchange rates relates primarily to the Company’s transactions denominated in a foreign currency including trade receivables and unbilled revenues, loans given to overseas subsidiaries, trade payables and bank balances.
The Company has the following strategy to mitigate the risk of changes in exchange rates on foreign currency exposures:
a. Availment of packing credit in foreign currency (PCFC), including entering into cross currency forward contracts in equivalent USD where the exposures are in other currencies. The exposure is Nil for both March 31,2026 and March 31, 2025
A. 3 Other price risk
The Company is exposed to equity price risks arising from equity investments. Company's equity investments are primarily in its subsidiaries which are held for strategic rather than trading purposes.
B. Credit risk
Credit risk is the risk of financial loss to the Company, if the customer or counter party to the financial instruments or supplier fail to meet its contractual obligations and arises principally from the Company’s receivables and treasury operations. Customer credit risk is managed by Company’s established policy, procedures and control relating to customer credit risk management.
Outstanding customer receivables and unbilled revenues are regularly monitored and the Company creates a provision based on expected credit loss model.
B.1 Trade receivables, unbilled revenues and advance to suppliers and service providers
(i) Trade receivables
Trade receivables of the Company include a) dues from its overseas subsidiaries amounting to 73% as at March 31,2026 (52% as at March 31, 2025), of total trade receivables which are risk free and b) dues from others which are exposed to credit risk. The number of external customers (excluding subsidiaries) and the percentage they owed exceeding Rs. 5.00 Mln. individually, out of the outstanding as at March 31,2026, were 8 and 58% respectively (10 and 62% as at March 31, 2025). External customers who accounted for more than 10% of the trade receivable from them, are two as at March 31,2026 (two as at March 31,2025).
The Company evaluates credit worthiness of each customer.
The Company tracks changes in credit risk of trade receivable using simplified approach as per Ind AS 109. The Company calculates the expected credit losses on trade receivables using a provision matrix on the basis of its historical credit loss experience.
Trade receivables are written off when there is no reasonable expectation of recovery, such as a debtor declaring bankruptcy or failing to engage in a repayment plan with the Company.
Where trade receivables have been written off, the Company continues to engage in enforcement activity to attempt to recover the receivable due. Where recoveries are made, these are recognized in profit and loss account.
(ii) Unbilled revenues
Unbilled revenues (Unbilled licenses revenue grouped under financial asset and unbilled services revenue grouped under non-financial assets i.e., other assets) of the Company are also exposed to risk in the event of the inability to bill the customer. Number of external customers constituting more than 10% of the unbilled revenues in respect of them, is two as at March 31, 2026 (eight as at March 31,2025).
The Company calculates the expected credit losses using simplified approach as per Ind AS 109, on the basis of its historical credit loss experience.
(iii) Advance to suppliers and service providers
Advance to suppliers and service providers are also exposed to risk in the event of inability to adjust such advances from their billing or otherwise recover the same.
B.2 Financial instruments and cash deposits
Investments of surplus funds are made only with approved counterparties. The Company is exposed to counter party risk relating to deposits with banks and investments in mutual funds. The Company places its cash equivalents based on the creditworthiness of the financial institutions.
During the year there were investments in mutual funds and fixed deposits. While there were balances in fixed deposits at the end of the year, the balance in mutual funds was nil (There were fixed deposits and investment in mutual fund as at the end of previous year).
C. Liquidity risk
Liquidity risks are those risks that the Company will not be able to settle or meet its obligations on time or at reasonable price. In the management of liquidity risk, the Company monitors and maintains a level of cash and cash equivalents deemed adequate by the management to finance the Company’s operations and to mitigate the effects of fluctuations in cash flows. Due to the dynamic nature of the underlying business, the Company aims at maintaining flexibility in funding by keeping the credit lines available.
The Company has on February 01, 2023 allotted to Mr. P R Venketrama Raja 1,459,854 warrants at a price of Rs. 274 (including premium of Rs. 264) each, entitling him for subscription of equivalent number of equity shares of Rs. 10 each under Regulation 28(1) of the SEBI (LODR), Regulations, 2015, upon receipt of Rs. 100 Mln. being 25% of the total price of the warrants. The warrants shall be convertible into Equity Shares, in one or more tranches, within a period of 18 months from the date of allotment, failing which the amount paid shall be forfeited and all the rights attached to the said warrants shall lapse automatically. The warrant holder had exercised the option to convert the warrants into equity shares by paying the balance consideration of Rs. 300.00 Mln. and the equity shares were alloted on July 24, 2024.
36. OTHER NOTES
a. The Company’s shares are listed on BSE Limited and The National Stock Exchange of India Limited. In line with the provisions of the listing agreement with the stock exchanges, the listing fee for the FY 2025-26 have been paid to the BSE Limited and The National Stock Exchange of India Limited.
b. Figures for the previous year have been regrouped/restated wherever necessary to make them comparable with the figures for the current year.
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