(h) Provisions, Contingent Liabilities and Contingent Assets
(As per AS 29 - “Provisions, Contingent Liabilities, and Contingent Assets ", under Companies
(Accounting Standards) Rules, 2021)
Provisions are recognized when:
The Company has a present obligation (legal or constructive) as a result of a past event.
It is probable that an outflow of resources will be required to settle the obligation.
A reliable estimate can be made of the amount of the obligation.
Provisions are reviewed at each balance sheet date and adjusted to reflect the best estimate. If
it is no longer probable that an outflow of resources will be required to settle the obligation,
the provision is reversed.
Contingent Liabilities are disclosed, unless the possibility of an outflow of resources is
remote:
A contingent liability is a possible obligation that arises from past events, whose existence
will be confirmed only by the occurrence or non-occurrence of one or more uncertain future
events.
Contingent liabilities are not recognized in the financial statements but are disclosed in the
notes to accounts if material.
Contingent Assets are not recognized in the financial statements:
Contingent assets are disclosed where an inflow of economic benefits is probable, but they
are not recognized as assets until realization is virtually certain.
If the realization of income is virtually certain, the related asset is recognized in the period in
which the change occurs.
(i) Cash and Cash Equivalents
(As per AS 3 - “Cash Flow Statements" under Companies (Accounting Standards) Rules, 2021)
Cash comprises cash on hand and demand deposits with banks.
Cash equivalents are short-term, highly liquid investments that are:
Readily convertible into known amounts of cash, and
Subject to an insignificant risk of changes in value.
Cash equivalents are held primarily for the purpose of meeting short-term cash
commitments, rather than for investment or other long-term purposes. Typically,
investments with original maturities of three months or less from the date of acquisition
qualify as cash equivalents.
(j) Cash Flow Statement
(As per AS 3 - “Cash Flow Statements”, under Companies (Accounting Standards) Rules,
2021)
The Company prepares its cash flow statement in accordance with AS 3 - Cash Flow
Statements using the direct method, whereby major classes of gross cash receipts and
gross cash payments are disclosed.
Cash flows are classified into the following categories:
Operating Activities: These are the principal revenue-generating activities of the
Company and include all other activities that are not classified as investing or financing
activities.
Investing Activities: These include the acquisition and disposal of long-term assets
(such as property, plant and equipment) and other investments not included in cash
equivalents.
Financing Activities: These include activities that result in changes in the size and
composition of the equity capital and borrowings of the Company.
Cash and cash equivalents include cash on hand, balances with banks in current
accounts, and other short-term, highly liquid investments with original maturities of three
months or less that are readily convertible into known amounts of cash and are subject to
an insignificant risk of changes in value.
(k) Earninas Per Share
(As per AS 20 - “Earnings per Share", under Companies (Accounting Standards) Rules, 2021)
Basic earnings per share (EPS) is calculated by dividing the net profit or loss attributable to
equity shareholders by the weighted average number of equity shares outstanding during
the reporting period. The weighted average number of equity shares outstanding is adjusted
retrospectively for any changes in the number of shares outstanding arising from bonus
issues, share splits, or similar events, that do not correspond to a change in the Company's
resources. Diluted earnings per share is calculated by adjusting the net profit or loss for the
period and the weighted average number of equity shares for the effects of all dilutive
potential equity shares, such as convertible instruments or stock options, if any.
In the current year, EPS has been restated for the 1:1 bonus issue of equity shares allotted on
29th January 2025, in accordance with the requirements of AS 20.
Bonus Issue of Equity Shares
During the year ended 31st March 2025, the Company allotted 54,00,000 (Fifty-Four Lakh) fully paid-up equity
shares of face value Rs. 10/- each as bonus shares to the existing shareholders in the ratio of 1 (One) equity share for
every 1 (One) equity share held as on the record date.
The bonus shares rank pari passu in all respects with the existing equity shares, including entitlement to dividends
declared, if any, after the date of allotment.
Impact of the Bonus Issue:
The Company's issued, subscribed, and paid-up equity share capital increased from Rs. 5.40 crore to Rs. 10.80 crore.
There was no cash outflow involved in the issuance of these bonus shares.
Earnings Per Share (EPS) for all periods presented in the financial statements have been restated to give effect to the
bonus issue, in accordance with the requirements of Ind AS 33 - Earnings per Share.
Accounting Ratios in which denominators are relating to Equity/ Capital Employed/ Investments, the ratios have
become unfavourable due to significant increase in the share capital of the company by way of Initial Public Offering
in the month of Novemeber 2022.
However the results of such additional capital is yet to be reaped by the company ( increase in sales/PBIT
significantly), as the additional machinery for which the capital is raised is yet to be delivered, and is expected to be
delivered in the next FY.
As per our report of even date For and on behalf of the Board of Directors
KARIA & ASSOCIATES
Chartered Accountants
FRN No.: 136752W
Kalpeshkumar Ishwarlal Pandya
Chief Financial Officer
DIN : 08196642
BRIJESH H. KARIA
Proprietor - -
Chetankumar I. Pandya Deepali Malpani fdhcpm9814el
Mem.No.: 149107 3 v v v v >
UDIN: 25149107BMIRZF3765 Managing Director Secretary
MORBI, May 29, 2025 DIN : 08196693 DIN : NA
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