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Notes to Accounts of Bodal Chemicals Ltd.

Mar 31, 2023

1. Pursuant to the Scheme of Amalgamation u/s 230 to 233 and other applicable Provisions of the Companies Act, 2013, Pursuant to the Scheme of amalgamation of SPS Processors Pvt. Ltd. (Transferor Company) with Bodal Chemicals Ltd ("the Company"), with effect from 1st April 2021 (appointed date), as approved by the Hon''ble NCLT, Ahmedabad Bench vide its order dated 2nd November 2022; Authorised Share Capital of SPS Processors Pvt. Ltd. of '' 1,65,00,000/-has been added in the Authorised Share Capital of the Company.

2. Rights, preferences and restrictions attached to shares Equity shares

The Company has only one class of equity shares having a par value of '' 2/- per share. Each shareholder is eligible for one vote per share. 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 of their shareholding. The dividend proposed by the board of directors is subject to the approval of the shareholders in the ensuing annual general meeting, except in case of interim dividend.

preference shares

The Company has only one class of non-convertible, non-cumulative redeemable preference shares having a par value of '' 10/- per share. Each shareholder shall have a right to attend general meeting of the Company and vote on resolutions directly affecting their interest. In the event of liquidation, the preference shareholders shall be entitled to a preferential right of return of the amount paid up on the shares, but shall not have any further right or claim over the surplus asset of the Company. The holder of these shares shall be entitled to receive dividend at fixed rate i.e. @ 9% on paid up value of shares subject to declaration of dividend by the Company but do not have right to participate in surplus profit.

*During the financial year, holding of Promoter and promoter group of the Company remains same by number of shares but due to allotment of shares underESOP percentage of their shareholding is changed.

17.7 The Board of directors has recommended a final dividend of '' 0.10 (PY. : '' 0.80) per equity share for the financial year ended 31st March 2023. The proposal is subject to the approval of shareholders at the annual general meeting and hence is not recognised as a liability.

18.1 Nature and purpose of Reserves Capital Reserves

The Company recognised profit or loss on sale, issue, purchase or cancellation of the Company''s own equity instruments to capital reserve. Capital reserve may be used by the Company only for some specific purpose.

Capital Redemption Reserve

Capital redemption reserve created during redemption of Preference Shares and it is a non-distributable reserve. Securities Premium

Securities Premium has been created consequent to issue of shares at premium. These reserves can be utilised in accordance with Section 52 of the Companies Act, 2013.

Employee Stock Options Outstanding Account

The fair value of the equity-settled share based payment transactions is recognised in Statement of Profit and Loss with corresponding credit to Employee Stock Options Outstanding Account.

General Reserve

General reserve is created from time to time by way of transfer profits from retained earnings for appropriation purposes.

Retained Earnings

Retained earnings represents the amount of profits of the Company earned till date net of appropriation that can be distributed by the Company as dividends considering the requirements of the Companies Act, 2013.

19.1 nature of security and terms of repayment for non-current secured borrowings:

The HDFC term loan amounting to '' 1,375.99 million (P Y. : '' 1,064.00 million) carries an interest rate of 9.20% (P Y. 6.70%)

The EXIM term loan amounting to '' 946.29 million (P Y.: '' 946.04 million) carries an interest rate of 8.05% (PY. 6.75%)

The term loan payable to Union bank for Saykha Project amounting to '' 342.58 million (PY. : '' 127.32 million) carries an interest rate of 8.25% (PY. 7.25%)

The term loan payable to Union bank for SCC project amounting to '' 402.25 million (PY. : '' NIL) carries an interest rate of 8.65% (PY. NIL)

The term loan payable to Indian bank amounting to '' 1034.86 million (PY. NIL) carries an interest rate of 8.10% (PY. NIL)

The EXIM term loan amounting to '' 187.00 million (P Y. NIL) carries an interest rate of 8.60%

19.2 These facilities are secured by first paripassu mortgage /hypothecation and charge on all the Company''s movable and immovable properties created or acquired at

i) Unit VII - Block No. 804, Village - Dudhwada, Ta. Padra, Dist. Vadodara, Gujarat

ii) Unit VIII - Block No. 106, 108, Village: Ekalbara, Ta. Padra, Dist. Vadodara, Gujarat

iii) Unit X - Plot No. 525, Village: Dudhwada, Ta: Padra, Dist. Vadodara, Gujarat

iv) Saykha - Plant / Unit at Saykha project

v) Plant / Unit at SIEL Chemical complex

A second paripassu charge on all Company''s current assets and receivables, including book debts, operating cash flows, receivables, commissions, revenues of whatsoever nature and wherever arising, present and future

The loan is repayable in 23 quarterly instalments, the first instalment payable in June 2023 and the last instalment payable in December 2028.

19.3 Current Maturities of Long Term Borrowings (Refer Note 20) of '' 670.65 million (PY. : Nil)

20.1 Secured Loan : Working capital loans from banks are secured by hypothecation of inventories, book debts and bills drawn under letters of credit and confirmed contracts and collaterally secured by equitable mortgage of immovable property and hypothecation of Plant & Machinery of Unit-7, Unit-8 and Unit-10 of the Company.

Rate of interest is from 3.56% to 9.05% (PY. 0.38% to 7.60%)

20.2 Maximum amount outstanding towards Commercial Papers is '' NIL (PY. : 500 million)

20.3 There were no discrepancies between the quarterly returns/statements submitted to bank for current assets given as security and the books of account for the respective quarter.

The Company has disclosed financial instruments such as cash and cash equivalents, other bank balances, trade receivables, loans, other financial assets, borrowings, trade payables and other financial liabilities at carrying value because their carrying amounts are a reasonable approximation of the fair values due to their short term nature.

Level 1: Level 1 hierarchy includes financial instruments measured using quoted prices. This includes listed equity instruments and mutual funds that have quoted price. The fair value of all equity instruments (including bonds) which are traded in the stock exchanges is valued using the closing price as at the reporting period. The mutual funds are valued using the closing NAV.

Level 2 The fair value of financial instruments that are not traded in an active market (for example, traded bonds, over-the counter derivatives) is determined using valuation techniques which maximise the use of observable market data and rely as little as possible on entity-specific estimates. If all significant inputs required to fair value an instrument are observable, the instrument is included in level 2.

Level 3: The fair value of financial instruments that are measured on the basis of entity specific valuations using inputs that are not based on observable market data (unobservable inputs).

Valuation technique used to determine fair value:

Specific valuation techniques used to value financial instruments include:

S the use of quoted market prices or dealer quotes for similar instruments

S the fair value of forward foreign exchange contracts is determined using forward exchange rates at the balance sheet date

S The fair value of investments in Mutual Fund Units is based on Net Asset Value ("NAV") as stated by the issuers of these mutual fund units in the published statements as at the 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 investors.

34 FINANCIAL RISK MANAGEMENT

The Company''s activities expose it to market risk, liquidity risk and credit risk. In order to minimise any adverse effects on the financial performance of the Company, derivative financial instruments, such as foreign exchange forward contracts are entered to hedge certain foreign currency risk exposures. Derivatives are used exclusively for hedging purposes and not as trading or speculative instruments.

This note explains the sources of risk which the Company is exposed to and how the Company manages the risk and the impact of hedge accounting in the financial statements

(A) Credit Risk Management

Credit risk refers to risk that a counterparty will default on its contractual obligations resulting in financial loss to the Company. Credit risk arises primarily from financial assets such as trade receivables, investment in mutual funds, derivative financial instruments, other balances with banks, loans and other receivables.

Credit risk arising from investment in quoted equity shares, mutual funds, derivative financial instruments and other balances with banks is limited and there is no collateral held against these because the counterparties are banks and recognised financial institutions with high credit ratings assigned by the international credit rating agencies.

(B) Liquidity Risk

Prudent liquidity risk management implies maintaining sufficient cash and marketable securities and the availability of funding through an adequate amount of committed credit facilities to meet obligations when due and to close out market positions. Due to the dynamic nature of the underlying businesses,Company treasury maintains flexibility in funding by maintaining availability at all times.

The table below analyses financial liabilities of the Company into relevant maturity groupings based on the remaining period from the reporting date to the contractual maturity date. The amounts disclosed in the table are the contractual undiscounted cash flows.

i) Foreign Currency Risk

The Company operates internationally and is exposed to foreign exchange risk arising from foreign currency transactions,primarily with respect to the USD and EURO. Foreign exchange risk arises from future commercial transactions and recognised assets and liabilities denominated in a currency that is not the Company''s functional currency (''). The risk is measured through a forecast of highly probable foreign currency cash flows.

ii) Cash flow and fair value interest rate risk

The Company''s interest rate risk arises mainly from borrowings with variable rates,which expose the Company to cash flow interest rate risk. During 31st March 2023 and 31st March 2022, the Company''s borrowings at variable rate were mainly denominated in '' & USD.

The Company''s fixed rate borrowings are carried at amortised cost. They are therefore not subject to interest rate risk as defined in Ind AS 107, since neither the carrying amount nor the future cash flows will fluctuate because of a change in market interest rates.

iii) Security Price Risk

The Company''s exposure to securities price risk arises from investments held by the Company and classified in the balance sheet at fair value through profit or loss.

To manage its price risk arising from investments in equity securities, the Company diversifies its portfolio. Diversification of the portfolio is done in accordance with the limits set by the Company.

35 CAPITAL MANAGEMENT

The Company''s objectives when managing capital are to

S safeguard their ability to continue as a going concern, so that they can continue to provide returns for shareholders and benefits for other stakeholders, and

S Maintain an optimal capital structure to reduce the cost of capital.

Consistent with others in the industry, the Company monitors capital on the basis of the following gearing ratio: Net debt (total borrowings net of cash and cash equivalents) divided by Total ''equity'' (as shown in the balance sheet).

37 SEGMENT INFORMATION

The Company is engaged in Dyes, Dyes Intermediates and Basic Chemicals. Considering the nature of company''s business and operations as well as reviews of operating results by the Chief Operating Decision Makers to make decisions about resource allocation, performance allocation and performance measurement, the Company has identified Dyes, Dyes Intermediates and Basic Chemicals activities as only responsible segment in accordance with the requirements of Ind AS 108 operating segment.

The geographical segment has been considered for disclosure as secondary segment.

Two secondary segments have been identified based on the geographical locations of customers i.e. domestic and export. Information about geographical segments are as below.

Post Employment Benefits

Gratuity: The Company has a defined benefit gratuity plan. Every employee who has completed five years or more of service gets a gratuity on departure at 15 days salary (last drawn salary) for each completed year of service. The scheme is funded with Life Insurance Corporation of India in the form of qualifying insurance policy.

The following table sets out the funded status of the gratuity plan and the amounts recognised in the Company''s financial statements based on actuarial valuations being carried out As at 31st March 2023.

The estimates of future salary increases, considered in actuarial valuation have taken into account inflation, seniority, promotion and other relevant factors, such as supply and demand in the employment market.

The rate used to discount defined benefit obligation (both funded and unfunded) is determined by reference to market yield at the Balance Sheet date on high quality corporate bonds. In countries where there is no deep market in such bonds the market yields (at the Balance Sheet Date) on government bonds shall be used. The currency and term of the corporate bonds or government bonds shall be consistent with currency and estimated term of the post employment benefit obligations.

The estimated term of the Obligation is around 10.55 years (PY. 10.66 years). The yields on the government bonds as at the valuation date were 7.45% (PY. 7.15%). The expected contribution in the next year is '' 12.49 million.

41 CONTINGENT LIABILITIES AND COMMITMENTS ('' in million)
Particulars	FY 2022-23	FY 2021-22
1) Disputed matters in appeals/contested in respect of:
i. Income Tax	81.20	18.45
ii. Excise	45.61	25.53

Future cash outflows in respect of the above are determinable only on receipt of Judgments /decisions pending with various forums/authorities. Based on the decisions of the Appellate authorities and the interpretations of other relevant provisions, the Company has been legally advised that the additional demand raised is likely to be either deleted or substantially reduced and accordingly no provision is considered necessary.

('' in million)
particulars	FY 2022-23	FY 2021-22
2) Letter of Credit issued by bankers and outstanding	189.79	871.65
3) Guarantee given by the Company (Refer Note 42)	327.01	200.85
(b) Commitments
		('' in million)
particulars	FY 2022-23	FY 2021-22
i. Estimated amount of Contracts remaining to be executed on capital account	1,333.87	2,393.05
and not provided for, net of advances.

Disclosure of payable to vendors as defined under the "Micro, Small and Medium Enterprise Development Act, 2006" is based on the information available with the Company regarding the status of registration of such vendors under the said Act, as per the intimation received from them on requests made by the Company. There are no overdue principal amounts / interest payable amounts for delayed payments to such vendors at the Balance Sheet date. There are no delays in payment made to such suppliers during the year or for any earlier years and accordingly there is no interest paid or outstanding interest in this regard in respect of payment made during the year or on balance brought forward from previous year.

45 SHARE BASED PAYMENTS

a) The Company initiated the "ESOP 2017" for all eligible employees in pursuance of the special resolution approved by the Shareholders in the Annual General Meeting held on 23rd September 2017. The Scheme covers eligible employees (except promoters or those belonging to the promoters'' group, independent directors and directors who either by himself or through his relatives or through any body-corporate, directly or indirectly holds more than 10% of the outstanding Shares of the Company). Under the Scheme, the Nomination and Remuneration Committee of directors of the Company, administers the Scheme and grants stock options to eligible directors or employees of the Company. The Committee determines the employees eligible for receiving the options and the number of options to be granted subject to overall limit of 1,000,000 options.

46 A Scheme of Amalgamation of S P S Processors Pvt. Ltd. ("SPS") with the Company (the "Scheme") was approved by the Board of Directors of the Company at their meeting held on 29th October 2021, with effect from appointed date of 1st April 2021. SPS is engaged in the business of manufacture of dyes intermediates. The Scheme was approved by Hon''ble NCLT Ahmedabad Bench vide its order dated 2nd November 2022. The Scheme has accordingly been given effect in the financial statements of Bodal Chemicals Ltd. from the Appointed date. As the transaction took place between the entities which are under common control, the Company has followed pooling of interest method as per ''Appendix C of Ind AS 103 - Business Combination. The figures presented in the financial statements, including comparatives are after giving effect to the said Scheme.

The consideration was paid by way of issue of 29,70,700 Company''s equity shares of '' 2 each in exchange of 48,700 equity shares of '' 10 each of SPS. All assets and liabilities including reserves are recorded in the books of accounts of the Company at their carrying amount as appearing in the consolidated financial statements of the Company. This has resulted in negative capital reserve of '' 62,23,394 adjusted in balance of Capital Reserve as on the date of acquisition.

The following class of items are reclassified due to accounting of amalgamation scheme as per Appendix C of IND-AS 103.

(c) Current financial year was affected by recession, hence Net Profit Ratio was lower as compared to previous financial year.

(d) Current financial year was affected by recession, hence Return on Investments was lower as compared to previous financial year.

(e) Current financial year was affected by recession, hence Net Capital Turnover Ratio was lower as compared to previous financial year.

(f) Current financial year was affected by recession, hence Return on Capital employed was lower as compared to previous financial year.

(g) Previous financial year was affected by COVID-19, hence Return on Equity was lower as compared to current financial year.

50 OTHER STATUTORY INFORMATION :

(i) The Company has not advanced or loaned or invested funds to any other person(s) or entity(ies) other than as disclosed below, 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.

(iii) The Company do 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.

(iv) Title deeds of all the Immovable Property are held in name of the Company.

(v) The Company has complied with the Scheme of Arrangements as approved by the National Company Law Tribunal (NCLT) in terms of sections 230 to 237 of the Companies Act, 2013 as is accounted in the financial statements in accordance with accounting standards.

(vi) There are no proceedings which have been initiated or pending against the Company for holding any benami property under the Benami Transactions (Prohibition) Act, 1988 (45 of 1988) and the rules made thereunder.

(vii) The Company has not been declared a wilful defaulter by any bank or financial institution.

(viii) The Company has not identified any transaction with Companies struck off under section 248 of the Companies Act, 2013 or section 560 of the Companies Act, 1956 and has no balances outstanding from struck of Companies.

(ix) The Company has complied with the number of layers prescribed under clause (87) of section 2 of the Act read with Companies (Restriction on number of Layers) Rules, 2017.

(x) The Company has not traded or invested in Crypto currency or Virtual Currency during the financial year.

51 The Code on Social Security, 2020 and Code of wages, 2019 relating to employee benefits during employment and post-employment benefits received Presidential assent in September 2020. The Codes have been published in the Gazette of India. However,the date on which the Codes will come into effect has not been notified. The Company will assess the impact of the Codes when it comes into effect and will record any related impact in the period the Codes become effective.

Mar 31, 2018

1. Classification and measurement of financial assets

Ind AS 101 requires an entity to assess classification and measurement of financial assets (investment in debt instruments) on the basis of the facts and circumstances that exist at the date of transition to Ind AS.

Ind AS 101 allows first-time adopters certain exemptions from the retrospective application of certain requirements under Ind AS. The Company has applied the following exemptions:

2. Business combinations

Ind AS 103 Business Combinations has not been applied to acquisitions of subsidiaries, or of interests in associates and joint ventures and transactions which are considered businesses for Ind AS, that occurred before 1stApril, 2016. The carrying amounts of assets and liabilities in accordance with Previous GAAP are considered as their deemed cost at the date of acquisition. After the date of the acquisition, measurement is in accordance with Ind AS.

3. Deemed cost for property, plant and equipment and intangible assets

Ind AS 101 permits a first-time adopter to elect to continue with the carrying value for all of its property, plant and equipment as recognised in the financial statements as at the date of transition to Ind AS, measured as per the previous GAAP and use that as its deemed cost as at the date of transition after making necessary adjustments for decommissioning liabilities. This exemption can also be used for intangible assets covered by Ind AS 38 Intangible Asset.

Accordingly, the Company has elected to measure all of its property, plant and equipment and intangible assets at their previous GAAP carrying value.

4. Fair value measurement of financial assets or financial liabilities

First-time adopters may apply Ind AS 109 to day one gain or loss provisions prospectively to transactions occurring on or after the date of transition to Ind AS. Therefore, unless a first-time adopter elects to apply Ind AS 109 retrospectively to day one gain or loss transactions, transactions that occurred prior to the date of transition to Ind AS do not need to be retrospectively restated.

5. Investment in Subsidiaries, Associates & Joint Ventures

The carrying amounts of the Company''s investments in its subsidiary and associate companies as per the financial statements of the Company prepared under Previous GAAP, are considered as deemed cost for measuring such investments in the opening Ind AS Balance Sheet

Transition to Ind AS - Reconciliations

Ind AS 101 requires an entity to reconcile equity, total comprehensive income and cash flows for prior periods. The following tables represent the reconciliations from IGAAP to Ind AS.

The presentation requirements under IGAAP differs from Ind AS and hence the IGAAP information has been reclassified for ease of reconciliation with Ind AS. The reclassified IGAAP information is derived based on the audited financial statements of the Company for the year ended March 31, 2016 and March 31, 2017.

The following reconciliations provide the explanations and quantification of the differences arising from the transition from Previous GAAP to Ind AS in accordance with Ind AS 101:

I. Reconciliation of Equity as at 1st April, 2016 and as at 31st March, 2017

II. Reconciliation of Statement of Profit and Loss for the year ended 31st March, 2017

III. Adjustments to Statement of Cash Flows for the year ended 31st March, 2017

Previous GAAP figures have been reclassified/regrouped wherever necessary to conform with the financial statements prepared under Ind AS.

* As required under Paragraph (10C) of Ind AS 101, the Company has reclassified items that it recognised in accordance with previous GAAP as one type of asset, liability or component of equity, but are a different type of asset, liability or component of equity in accordance with Ind ASs.

III. Adjustments to Statement of Cash Flows for the year ended 31st March, 2017

There were no material differences between the Statement of Cash Flows presented under Ind AS and the Previous GAAP

Notes to the Reconciliations 1: Investments

In the financial statements prepared under Previous GAAP Non-current Investments of the Company were measured at cost less provision for diminution (other than temporary). Under Ind AS, the Company has recognised such investments as follows

- Quoted Equity Shares - At fair value through profit and loss (FVTPL)

- Quoted Mutual Fund - At fair value through profit and loss (FVTPL)

- Unquoted Equity Shares - At cost

- Equity shares of subsidiary and associate companies - At cost

- Preference shares of associate company - At cost

Ind AS requires the above investments to be recognised at fair value (except investments in equity shares of subsidiary and associate companies).

On the date of transition to Ind AS, the difference between the fair value of Investments as per Ind AS and their corresponding carrying amount as per financial statements prepared under Previous GAAP has resulted in a decrease in the carrying amount of these investments by Rs. 0.89 million which has been recognised directly in retained earnings (Equity).

As at 31st March, 2017, the difference between the fair value of Investments as per Ind AS and their corresponding carrying amount as per financial statements prepared under Previous GAAP has resulted in an increase in the carrying amount of these investments by Rs. 48.69 million. On such fair valuation, net gain amounting to 49.58 million has been recognised in other income in the Statement of Profit and Loss.

The above transition has resulted in decrease in equity by Rs. 0.89 million as at date of transition to Ind AS and increase by Rs. 48.69 million as at 31st March, 2017.

2 : Trade Receivables

On the date of transition to Ind AS, the provision for expected credit loss on trade receivables has resulted in a decrease in the carrying amount of these receivables by Rs. 2.85 million which has been recognised directly in retained earnings (Equity). Deferred Tax Liability of Rs.0.99 million has been recognized on such provision.

As at 31st March, 2017, the provision for expected credit loss on trade receivables has resulted in a decrease in the carrying amount of these receivables by Rs. 2.42 million. On such provision, net gain amounting to Rs. 0.43 million has been recognised in other income in the Statement of Profit and Loss. Deferred Tax Liability of Rs.0.15 lakhs has been recognized on such gain.

The above transition has resulted in decrease in equity by Rs. 1.86 million as at date of transition to Ind AS and increase by Rs. 0.28 million as at 31st March, 2017.

3 : Other Financial Assets / Liabilities

Under Ind AS, foreign exchange forward contracts are mark-to-market as at each Balance Sheet date and unrealised net gain or loss is recognised. Derivative assets and derivative liabilities are presented on gross basis. Under previous GAAP in case of forward contracts covered under AS 11, difference between forward rate and spot rate was recognised in profit or loss over the term of contract. This difference has resulted in decrease in equity under Ind AS Rs. 20.42 million as at March 31, 2017 and deferred tax of Rs. 7.07 million on such provision has been recognised (decrease of Rs. 7.34 million as at April 1, 2016 and Deferred Tax Liability of Rs. 2.54 million has been recognized on such provision) and decrease of profit by Rs. 13.08 million for the year ended March 31, 2017 and deferred tax of Rs. 0.45 million has been recognized on such gain.

4 : Remeasurements of Net Defined Benefit Plans

In the financial statements prepared under Previous GAAP remeasurement benefit of defined plans (gratuity), arising primarily due to change in actuarial assumptions was recognised as employee benefits expense in the Statement of Profit and Loss. Under Ind AS, such remeasurement benefits relating to defined benefit plans is recognised in OCI as per the requirements of Ind AS 19- Employee benefits. Consequently, the related tax effect of the same has also been recognised in OCI.

For the year ended 31st March, 2017, remeasurement of gratuity liability resulted in a net cost of Rs. 2.87 million which has now been removed from employee benefits expense in the Statement of Profit and Loss and recognised separately in OCI. This has resulted in decrease in employee benefits expense by Rs. 2.87 million and loss in OCI by Rs. 2.87 million for the year ended 31st March, 2017. Consequently, tax effect of the same amounting to Rs. 0.99 million is also recognized separately in OCI.

5: Deferred Tax

Under Previous GAAP, deferred taxes were recognised for the tax effect of timing differences between accounting profit and taxable profit for the year using the income statement approach. Under Ind AS, deferred taxes are recognised using the balance sheet for future tax consequences of temporary differences between the carrying value of assets and liabilities and their respective tax bases. The above difference, together with the consequential tax impact of the other Ind AS transitional adjustments lead to temporary differences. Deferred tax adjustments are recognised in correlation to the underlying transaction either in retained earnings or through other comprehensive income.

The above changes have resulted in creation of deferred tax liabilities (net) amounting to Rs. 3.52 million as at date of transition to Ind AS and Rs. 7.90 million as at 31st March, 2017. For the year ended 31st March, 2017, it has resulted in

an increase in deferred tax expense by Rs. 3.38 million in the Statement of Profit and Loss and recognition of deferred tax benefit by Rs. 0.99 million in OCI.

6: Other comprehensive income

Under IGAAP, actuarial gains and losses were recognised in profit or loss. Under Ind AS, the actuarial gains and losses form part of re-measurement of the net defined benefit liability / asset which is recognised in other comprehensive income. Consequently, the tax effect of the same has also been recognised in other comprehensive income under Ind AS instead of profit or loss. The actuarial losses for the year ended March 31, 2017 were Rs. 2.87 million and the tax effect thereon Rs. 0.99 million. This change does not affect total other equity, but there is a increase in profit before tax of Rs.

2.87 million, and in total profit of Rs. 1.87 million for the year ended March 31, 2017.

29.1 Revenue from operations for period up to 30th June, 2017 included Excise duty, which is discontinued from 1st July, 2017 on implementation of Goods and Service tax (GST) in India. In accordance with Ind AS 18 - Revenue, GST, is not included in revenue from operations. In view of the aforesaid restructuring of Indirect taxes, revenue from operations for the year ended on 31st March, 2018 is not comparable with previous year.

36.1 During the year, the Company has changed its method of providing depreciation on fixed assets from Written Down Value Method (WDV) to Straight Line Method (SLM) with effect from 1st April, 2017.

Due to the change in the method of depreciation, the amount of depreciation has been lower by Rs.149.27 million for the year ended on 31st March, 2018 and hence the said figures are not comparable with the figures of the corresponding year.

If the Company would have continued to provide depreciation on earlier method (WDV) on its assets, the profit after tax would have been Rs.1178.41 million instead of Rs.1275.44 million for the year ended 31st March, 2018.

Level 2: The fair value of financial instruments that are not traded in an active market (for example, traded bonds, over-the counter derivatives) is determined using valuation techniques which maximize the use of observable market data and rely as little as possible on entity-specific estimates. If all significant inputs required to fair value an instrument are observable, the instrument is included in level 2.

Valuation technique used to determine fair value:

Specific valuation techniques used to value financial instruments include:

- the use of quoted market prices or dealer quotes for similar instruments

- the fair value of forward foreign exchange contracts is determined using forward exchange rates at the balance sheet date

- The fair value of investments in Mutual Fund Units is based on Net Asset Value ("NAVâ) as stated by the issuers of these mutual fund units in the published statements as at the 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 investors.

7. Financial Risk Management

The Company''s activities expose it to market risk, liquidity risk and credit risk. In order to minimize any adverse effects on the financial performance of the Company, derivative financial instruments, such as foreign exchange forward contracts are entered to hedge certain foreign currency risk exposures. Derivatives are used exclusively for hedging purposes and not as trading or speculative instruments.

This note explains the sources of risk which the entity is exposed to and how the entity manages the risk and the impact of hedge accounting in the financial statements

(B) Liquidity Risk

Prudent liquidity risk management implies maintaining sufficient cash and marketable securities and the availability of funding through an adequate amount of committed credit facilities to meet obligations when due and to close out market positions. Due to the dynamic nature of the underlying businesses, Company treasury maintains flexibility in funding by maintaining availability at all times.

Management monitors rolling forecasts of the Company''s liquidity position 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.

(A) Credit Risk Management

Credit risk arising from investment in mutual funds, derivative financial instruments and other balances with banks is limited and there is no collateral held against these because the counterparties are banks and recognised financial institutions with high credit ratings assigned by the international credit rating agencies.

The Company is making provision on trade receivables based on Expected Credit Loss Model (ECL).

(C) Market Risk Management

i) Foreign Currency Risk

The Company operates internationally and is exposed to foreign exchange risk arising from foreign currency transactions, primarily with respect to the US$ and EUR. Foreign exchange risk arises from future commercial transactions and recognised assets and liabilities denominated in a currency that is not the Company''s functional currency (INR). The risk is measured through a forecast of highly probable foreign currency cash flows.

ii) Cash flow and fair value interest rate risk

The Company''s main interest rate risk arises from borrowings with variable rates, which expose the Company to cash flow interest rate risk. During 31 March 2018 and 31 March 2017, the Company''s borrowings at variable rate were mainly denominated in INR & USD.

iii) Security Price Risk

The Company''s exposure to securities price risk arises from investments held by the Company and classified in the balance sheet at fair value through profit or loss.

8. Capital Management

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, and

- Maintain an optimal capital structure to reduce the cost of capital.

Consistent with others in the industry, the Company monitors capital on the basis of the following gearing ratio:

Notes:-

(i) Bodal Agrotech Ltd is amalgamated with Bodal Chemicals Ltd w.e.f 1st, April, 2016 and in previous year loan was given for acquisition of assets and other business purposes and has been utilized for the same.

(ii) No amounts pertaining to related parties have been provided for as doubtful debts. Also no amounts have been written off or written back during the year.

Defined Benefits Plan

9. Brief Description of exceptional items:

During the previous year 2016-17, the Company had sold out Unit-5 located at Ankleswar- GIDC, Bharuch, Gujarat. The Company has gained Rs. 48.55 million out of sale of whole unit and the same is disclosed under "Exceptional itemsâ in the statement of Profit and loss.

48. Disclosure under the Micro, Small and Medium Enterprises Development Act, 2006 are provided as under for the year 2017-18, to the extent the Company has received intimation from the "Suppliersâ regarding their status under the Act.

10 Corporate Social Responsibility Expenses

A. Gross amount required to be spent by the Company during the year 2017-18 Rs. 31.07 million (Previous year - Rs. 21.50 million)

50. Share Based Payments

a) The Company initiated the "ESOP 2017â for all eligible employees in pursuance of the special resolution approved by the Shareholders in the Annual General Meeting held on 23rd September, 2017. The Scheme covers eligible employees (except promoters or those belonging to the promoters'' group, independent directors and directors who either by himself or through his relatives or through any body-corporate, directly or indirectly holds more than 10% of the outstanding Shares of the Company). Under the Scheme, the Nomination and Remuneration Committee of directors of the Company, administers the Scheme and grants stock options to eligible directors or employees of the Company. The Committee determines the employees eligible for receiving the options and the number of options to be granted subject to overall limit of 1,000,000 options.

c) Fair Value on the grant date

The fair value on the grant date is determined using "Black Scholes Modelâ, which takes into account exercise price, term of the option, share price at grant date and expected price volatility of the underlying shares, expected dividend yield and risk free interest rate for the term of the option.

The model inputs for options granted during the year ended 31st March, 2018 included as mentioned below.

a) Weighted average exercise price Rs. 50/-

b) Grant date: 13/01/2018

c) Vesting Period: 13/01/2018 to 12/01/2019

d) Share Price at grant date: Rs. 168.70

e) Expected price volatility of Company''s share: 31%

f) Expected dividend yield: 0.19%

g) Risk free interest rate: 7.45 %

The expected price volatility is based on the historic volatility (based on remaining life of the options).

11. The Ind AS financial Statements of the Company for the year ended 31st March, 2017, were audited by M/s. Mayank Shah & Associates, Chartered Accountants, the predecessor statutory auditors.

12. Previous year''s figures have been rearranged and reclassified wherever necessary to correspond with the current year.

Mar 31, 2017

Company Background

Bodal Chemicals Limited (the âCompanyâ) is a public limited Company incorporated under the Companies Act 1956. The Company is engaged in the business of manufacturing of Dyes, Dye Intermediates and Basic Chemicals.

1.1 Pursuant to the Scheme of Amalgamation u/s 391 to 394 of the Companies Act, 1956 and u/s 52 of the Companies Act, 2013 for amalgamation of Bodal Agrotech Ltd. (Transferor Company) with the Company, with effect from 1st April, 2016 (appointed date), as sanctioned by the Honâble High Court of Gujarat dated 11th November 2016, Authorised Share Capital of Bodal Agrotech Ltd. of RS.30 millions has been added in the Authoried Share Capital of the Company

1.2 Rights, preferences and restrictions attached to shares Equity shares

The Company has only one class of equity shares having a par value of RS.2/- per share. Each shareholder is eligible for one vote per share. 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 of their shareholding The dividend proposed by the Board of Directors is subject to the approval of the shareholders in the ensuing Annual General Meeting, except in case of interim dividend.

1.3 The Board of Directors at its meeting held on 3rd August, 2016 declared an interim dividend of H0.30 (Paise thirty only) per equity share of RS.2/- each. The total dividend appropriation for the year ended 31st March, 2017 amounted to RS.39.40 millions including corporate dividend tax of RS.6.67 millions.

1.4 The Board of Directors at its meeting held on 25th May, 2017 has recommended a final dividend of H0.50 (Paise fifty only) per equity share for the financial year ended March 31, 2017. The proposal is subject to the approval of shareholders at the Annual General Meeting and if approved would result in a cash outflow of RS.65.66 millions including corporate dividend tax of RS.11.11 millions.

2.1 Working Capital Loans from Banks are secured by Hyp. Of Inventories, Book Debts and bills drawn under letter of credit and confirmed contracts and collaterally secured by equitable mortgage of Immovable property and Hyp. Of P&M of the company and personal guarantees of the Chairman and Managing Director and Executive directors.

2.2 Unsecured Working Capital Loan from Bank is personally guaranteed by Chairman and Managing Director and Executive directors.

3.1 Trade Payables include RS.66.71 millions (PY RS.8.38 millions) to related parties (refer note 33)

4.1 There is no amount due and outstanding to be transferred to the Investor Education and Protection Fund as on 31st March 2017

4.2 Other Current Liabilities includes Deferred Premium, Interest payable, expenses payable etc.

4.3 Statutory liabilities represent amounts payable towards VAT, CST, Excise duty and TDS etc.

5.1 Provision for Employee Benefits include RS.1.18 millions (PY 15.31 millions) to related parties (refer note 33)

6.1 1 (One) Equity Share of Bhageria Industries Ltd. of RS.10/- each is sub-divided into 2 (Two) Equity Shares of RS.5/- each fully paid-up with effect from October 27, 2016.

7.1 Balance with Statutory Authorities includes balances with Excise, Service Tax, Sales Tax, Customs Dept. etc.

8.1 Trade Receivables include RS.22.73 millions (PY RS.9.13 millions) to related parties. (refer note 33)

9.1 Details of Specified Bank Notes (SBN) held and transacted during demonetisation period from 08-11-2016 to 30-12-2016

10.1 Advances to supplier of goods include RS.41.64 millions (PY RS.15.56 millions) to related parties. (refer note 33)

10.2 Balance with Statutory Authorities includes balances with Excise, Service Tax, Sales Tax, etc.

10.3 Others include Tour Advances, Gratuity Planned Assets (Net), and Income Receivables.

11 Derivative Instruments and Un-hedged Foreign Currency Exposure

The company enters into forward exchange contracts to hedge against its foreign currency exposures relating to the underlying transactions and firm commitments. The company does not enter into any derivative instruments for trading or speculative purposes.

12 Employeesâ Benefits

a) Defined Benefit Plan Gratuity

The Company has a defined benefit gratuity plan. Every employee who has completed five years or more of service gets a gratuity on departure at 15 days salary (last drawn salary) for each completed year of service. The scheme is funded with Life Insurance Corporation of India and Star Union Dai-ichi Life insurance company in the form of qualifying insurance policy.

The following table sets out the funded status of the gratuity plan and the amounts recognised in the companyâs financial statements based on actuarial valuations being carried out as at 31st March 2017.

b) Defined Contribution Plan

The company has recognized the following amount in statement of profit and loss which is included under contribution to funds.

13 Information on related party transactions as required by Accounting Standard (AS-18) on Related Party Disclosures for the year ended 31st March, 2017.

a) Names of related parties and nature of relationship I. Key Management Personnel (KMP)

1. Shri Suresh J. Patel Chairman& Managing Director

2. Shri Bhavin S. Patel Executive Director

3. Shri Ankit S. Patel Executive Director

4. Shri Mayur B. Padhya Chief Financial Officer

5. Shri Ashutosh B. Bhatt Company Secretary

II. Enterprise under significant influence of key management personnel (Enterprise)

(i) Shanti Inorgo Chem (Guj.) Pvt. Ltd.

(ii) Rudraksh Caterers Pvt. Ltd.

III. Associate Concern (AC)

(i) Trion Chemicals Pvt. Ltd. (W.e.f 16th March,2017)

IV. Subsidiary Company (SC)

(i) SPS Processors Pvt. Ltd. (W.e.f 21st March,2017)

V. Wholly-owned Subsidiary Company (WOS)

(i) Bodal Agrotech Ltd. (Up to 31st March, 2016)

Notes:-

(ii) No amounts pertaining to related parties have been provided for as doubtful debts. Also no amounts have been written off or written back during the year.

14 Segment Reporting:

The Companyâs primary segment is identified as business segment based on nature of products, risks, returns and the internal business reporting system and secondary segment is identified based on the geographical location of the customers as per Accounting Standard 17. The Company is principally engaged in a single business segment viz., âDyes, Dyes Intermediates and Basic Chemicalsâ.

The geographical segment has been considered for disclosure as secondary segment.

Two secondary segments have been identified based on the geographical locations of customers i.e. domestic and export. Information about geographical segments are as below.

a) Revenue from external operations comprises of income from sale of products, and other operating revenues.

b) Carrying amount of segment assets comprises of non-current assets and current assets identified to the respective segments. However Segments assets in India also includes certain common assets used to generate revenue in both segments but not feasible of allocation.

c) Capital expenditure during the year represents net additions to Tangible and Intangible assets and movement in Capital work in progress.

15 Disclosure under the Micro, Small and Medium Enterprises Development Act, 2006 are provided as under for the year 2016-17, to the extent the Company has received intimation from the âSuppliersâ regarding their status under the Act.

16 Corporate Social Responsibility Expenses

A. Gross amount required to be spent by the Company during the year 2016-17 - RS.21.47 millions (Previous year - RS.10.64 millions)

B. Amount spent during the year on :

17 Exceptional items

During the Year, the Company has sold out Unit-5 located at Ankleswar- GIDC, Bharuch, Gujarat. The company has gained RS.48.54 millions out of sale of whole unit and the same is disclosed under âExceptional itemsâ in the statement of Profit and loss.

Further, the revenue of Unit- V of the Company during the last financial year was nominal and the company has also not calculated capacity of Unit V in total production of capacity disclosed by the company

18 Amalgamation of Wholly Owned Subsidiary with the Company

Pursuant to the Scheme of Amalgamation u/s 391 to 394 of the Companies Act, 1956 for amalgamation of the erstwhile wholly owned subsidiary Bodal Agrotech Ltd. (Transferor Company) whose business of manufacturing as well as trading of the chemicals products merged with the Company, with effect from 1s, April, 2016 (appointed date), as sanctioned by the Honâble High Court of Gujarat. The effect of the merger has been given in the accounts as per the scheme sanctioned.

The amalgamation has been accounted for under the âPooling of Interests methodâ as prescribed by Accounting Standard 14 (AS-14) notified by the Government of India. Accordingly, the assets, liabilities and reserves of the erstwhile Bodal Agrotech Ltd. as on the appointed date have been merged with the Company at their book values. The net impact of the merger on assets, liabilities and reserves as on the appointed date is as below:

* On amalgamation RS.17 millions carrying value of investment in equity of the transferor company eliminated in books of Transferee Company against Equity Share Capital of the Transferor Company

The scheme was given effect to in the financial statement from 1st April, 2016 and accordingly all the assets, liabilities, reserves and surplus of Transferor Company were recorded in the books of the transferee Company at their carrying amounts.

The figures for the previous year do not include figures for the erstwhile Bodal Agrotech Ltd. and accordingly the current yearâs figures are not comparable to those of the previous year.

19 During the year, the Company has acquired 70% of the equity shares in SPS Processors Pvt. Ltd. As a result of this acquisition, SPS Processors Pvt Ltd. has become a subsidiary of the Company with effect from 21st March, 2017.

20 During the year, the Company has acquired 41.51% of the equity shares and 100% of the preference shares in Trion Chemicals Pvt. Ltd. As a result of this acquisition, Trion Chemicals Pvt. Ltd. has become an Associate concern of the Company with effect from 16th March, 2017.

21 Previous yearâs figures have been rearranged and reclassified wherever necessary to correspond with the current year.

Mar 31, 2016

1. Term loan from banks balance outstanding amounting to Rs. Nil (P.Y.: Rs. 1200.00 lacs) is secured by 1 st charge on immovable properties of the company situated at Plot No. 252,253,254 GIDC, Vatva and Plot No. 804 of Padra Unit and Hyp. of entire P&M and other equipment of the company. Loan id fully paid in August 2015. Rate of interest 12.75% (P.Y. 12.75%) p.a.

2. Term loan from banks balance outstanding amounting to Rs. Nil (P.Y.: Rs. 3704.00 lacs) is secured by 1 st charge on immovable properties of the company situated at Plot No. 804 & Block No. 800,803/1, 797, 796, 795, 532, 555, 556, 560, 561/1 and 525, Village Dudhavada,Taluka Padra, Vadodara and Hyp. of entire P&M and other equipment of the company. Loan is fully paid in March 2016. Rate of interest 12.40% (P.Y. 12.75%) p.a.

3. Term loan from banks balance outstanding amounting to Rs.Nil (P.Y.:Rs.2300.00 lacs) is secured by 1 st charge on immovable properties of the company situated at Plot No. 804 & Block No. 800,803/1, 797, 796, 795, 532, 555, 556, 560, 561/1 and 525, Village Dudhavada,Taluka Padra, Vadodara and Hyp. of entire P&M and other equipment of the company. Loan is fully paid in June 2015. Rate of interest 15.45% (P.Y. 15.25%) p.a.

4 Working Capital Term loan from banks balance outstanding amounting to Rs. Nil (P.Y.: Rs. 1349.50 lacs) is secured by 1 st pari pasu charge on entire current assets of the company. Loan is fully paid in August 2015. Rate of interest 12.75% (P.Y. 12.75%) p.a.

5. Vehicle loan, balance outstanding amounting to Rs. Nil (P.Y.: Rs. 8.05 lacs) is secured by Hire Purchase agreement for vehicles and repayable in monthly installments. Interest rate from 9%to 10%.

6 The Company has not defaulted in the repayment of loans and interest in current and previous year.

7. Working Capital Loans from Banks are secured by Hyp. Of Inventories, Book Debts and bills drawn under letter of credit and collaterally secured by equitable mortgage on Immovable property and Hyp. Of P&M of the company and personal guarantees of the Chairman and Managing Director and Executive directors. It is further secured by pledge of equity shares of the company held by the promoters and promoter group(excluding 3 NRIs and 1 resident Indians from promoter groups).

8. Trade Payables include Rs. 236.98 lacs (P.Y. 668.17 lacs) to related parties (refer note 35)

9. There is no amount due and outstanding to be transferred to the Investor Education and Protection Fund as on 31st March 2016.

10. Other Current Liabilities includes Deferred Premium, Interest payable, expenses payable etc.

11. Statutory liabilities represent amounts payable towards VAT, CST, Excise duty and TDS etc.

12 Balance with Statutory Authorities includes balances with Excise, Service Tax, Sales Tax, Customs Dept. etc.

* Held as lien by bank against bank guarantees and letters of credit.

18.1 Advances to supplier of goods include Rs. 246.86 lacs (P.Y. 171.94 lacs) to related parties, (refer note 35)

13 Balance with Statutory Authorities includes balances with Excise, Service Tax, Sales Tax, etc.

14 Others include Tour Advances, Gratuity Planned Assets (Net), and Income Receivables.

15 Excess provision written back includes provision of Interest recompense on exit from Corporate Debt Restructuring (CDR) amounting Rs. 350.78 lacs and liabilities not required to be paid by the company amounting Rs. 439.11 lacs.

The forward exchange contract outstanding as at 31 st March, 2016 are as under,

16. During the year there was fire at the Company''s unit situated at Vatva, Ahmadabad and due to fire part of inventories, plant and machinery, electronic components, building structure and others has been damaged. The above items are fully insured and the company has received insurance claim of Rs. 156.13 lacs from insurance company against insurance claim of Rs. 160.21 lacs resulting i n loss due to fi re of Rs. 4.08 lacs.

a) Defined Benefit Plan Gratuity

The following table sets out the funded status of the gratuity plan and the amounts recognized in the company''s financial statements based on actuarial valuations being carried out as at 31 st March 2016.

i) Loan to subsidiary has been given for acquisition of assets and other business purposes.

ii) The loaned does not have any investment in the shares of the Company.

iii) There are no guarantees issued by the Company in accordance with section 186 of the Companies Act, 2013 read with rules issued hereunder.

a) Names of related parties and nature of relationship

I. Key Management Personnel (KMP)

1. Shri Suresh J. Patel Chairman& Managing Director

2. Shri Bhavin S. Patel Executive Director

3. Shri Ankit S. Patel Executive Director

4. Shri Mayur B. Padhya Chief Financial Officer

5. Shri Ashutosh B. Bhatt Company Secretary

II. Enterprise under significant influence of key management personnel(Enterprise)

(i) Shanti Inorgo Chem (Guj.) Pvt. Ltd.

(ii) Rudraksh Caterers Pvt. Ltd.

III. Wholly-owned Subsidiary Company (WOS)

(I) Bodal Agrotech Ltd.

The Company''s primary segment is identified as business segment based on nature of products, risks, returns and the internal business reporting system and secondary segment is identified based on the geographical location of the customers as per Accounting Standard 17. The Company is principally engaged in a single business segment viz.,"Dyes, Dyes Intermediates and Basic Chemicals".

a) Revenue from external operations comprises of income from sale of products, and other operating revenues.

c) Capital expenditure during the year represents net additions to Tangible and Intangible assets and movement in Capital work in progress.

* Represents actual outflow during the year.

At their respective meeting held on 10th march, 2016, the Board of the Company and of its subsidiary, Bodal Agrotech Ltd. have approved a scheme of amalgamation of Bodal Agrotech Ltd. with the company. The appointed date for the proposed scheme is 1 st April,2016.

The scheme of amalgamation is subject to the final order of the Hon''ble High Court of Gujarat and other legal compliances as per the provision of the Companies Act 1956 and other applicable provisions of the Companies Act, 2013. The effect of the amalgamation will be given in the books of the Company only after Final Order is passed in the matter by the Hon''ble High Court of Gujarat.

17 : Previous year''s figures have been rearranged and reclassified wherever necessary to correspond with the current year.

Mar 31, 2015

1.1 Rights, preferences and restrictions attached to shares Equity shares

The Company has only one class of equity shares having a par value of Rs. 2/- per share. Each shareholder is eligible for one vote per share. 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 of their shareholding.

Preference shares

The Company has only one class of non-convertible, non-cumulative redeemable preference shares having a par value of Rs. 10/- per share. Each shareholder shall have a right to attend general meeting of the company and vote on resolutions directly affecting their interest. In the event of liquidation, the preference shareholders shall be entitled to a preferential right of return of the amount paid up on the shares, but shall not have any further right or claim over the surplus asset of the company. The holder of these shares shall be entitled to receive dividend at fixed rate i.e. @ 9% on paid up value of shares subject to declaration of dividend by the company but do not have right to participate in surplus profit.

*Amount disclosed under other current liabilities (Refer Note 9)

2.1 Nature of Security and terms of repayment for Long Term secured borrowings

2.1.1 Term loan from banks balance outstanding amounting to Rs.1200.00 lacs (P.Y.:Rs.1455.00 lacs) is secured by 1st charge on immovable properties of the company situated at Plot No. 252,253,254 GIDC, Vatva and Plot No. 804 of Padra Unit and Hyp. of entire P&M and other equipment acquired through the term loan and repayable in 40 quarterly installments starting from April 2012. Last installment is due in March, 2022. Rate of interest 12.75%. (P.Y.16.50%) p.a. at year end.

2.1.2 Term loan from banks balance outstanding amounting to Rs.3704.00 lacs (P.Y.:Rs.4491.10 lacs) is secured by 1st charge on immovable properties of the company situated at Plot No. 804 & Block No. 800, 803/1, 797, 796, 795, 532, 555, 556, 560, 561/1 and 525, Village Dudhavada, Taluka Padra, Vadodara and Hyp. of entire P&M and other equipment acquired through the term loan and repayable in 40 quarterly installments starting from April, 2012. Last installment is due in March, 2022. Rate of interest 12.75 % (P.Y. 15.50%) p.a. at year end.

2.1.3. Term loan from banks balance outstanding amounting to Rs.2300.00 lacs (P.Y.:Rs.4243.75 lacs) is secured by 1st charge on immovable properties of the company situated at Plot No. 804 & Block No. 800, 803/1, 797, 796, 795, 532, 555, 556, 560, 561/1 and 525, Village Dudhavada, Taluka Padra, Vadodara and Hyp. of entire P&M and other equipment acquired through the term loan and repayable in 40 quarterly installments starting from April, 2012. Last installment is due in March, 2022. Rate of interest 15.25%. (P.Y. 15.00 %) p.a. at year end.

2.1.4 Working Capital Term loan from banks balance outstanding amounting to Rs.NIL (P.Y.:Rs.374.42 lacs) is secured by 1st pari pasu charge on entire current assets of the company. Loan is fully paid in August 2014. Rate of interest 15.75% (P.Y. 15.75%) p.a.

2.1.5. Working Capital Term loan from banks balance outstanding amounting to Rs.1349.50 lacs (P.Y.:Rs.2037.00 lacs) is secured by 1st pari pasu charge on entire current assets of the company and repayable in 120 monthly installments starting from April, 2012. Last installment is due in March, 2022. Rate of interest 12.75% (P.Y. 16.00%) p.a. at year end.

2.1.6 Working Capital Term loan from banks balance outstanding amounting to Rs.NIL (P.Y.:Rs.3488.00 lacs) is secured by 1st pari pasu charge on entire current assets of the company. loan is fully paid in July 2014. Rate of interest 10.25% (P.Y.: 10.25% )p.a.

2.1.7 Working Capital Term loan from banks balance outstanding amounting to Rs.NIL (P.Y.:Rs.5735.61 lacs) is secured by 1st pari pasu charge on entire current assets of the company. Loan is fully paid in July 2014. Rate of interest 10.25% (P.Y.: 10.25%) p.a.

2.1.8 Funded Interest Term loan from banks balance outstanding amounting to Rs.NIL (P.Y.:Rs.1000.47 lacs) is secured by 1st pari pasu charge on entire current assets of the company. Loan is fully paid in June 2014. Rate of interest 10.25% (P.Y.: 10.25% ) p.a.

2.1.9 Funded Interest Term loan from banks balance outstanding amounting to Rs.NIL (P.Y.:Rs.1476.90 lacs) is secured by 1st pari pasu charge on entire current assets of the company. Loan is fully paid in June 2014. Rate of interest 10.25% (P.Y.: 10.25%) p.a.

2.1.10 Vehicle loan ,balance outstanding amounting to Rs.8.05 lacs (P.Y.:Rs.27.53 lacs) is secured by Hire Purchase agreement for Vehicles and repayable in monthly installments. Interest rate from 9% to 10%.

3.1 Term Loans are collaterally further secured by equitable mortgage on Immovable property and Hyp. Of P&M of the company. It is further secured by personal guarantees of the Chairman and Managing Director and Executive directors.

It is further secured by pledge of equity shares of the company held by the promoters and promoter group(excluding 3 NRIs and 2 resident indians from promoter groups).

4.1 Working Capital Loans from Banks are secured by Hyp. Of Inventories, Book Debts and bills drawn under letter of credit and collaterally secured by equitable mortgage on Immovable property and Hyp. Of P&M of the company and personal guarantees of the Chairman and Managing Director and Executive directors. It is further secured by pledge of equity shares of the company held by the promoters and promoter group(excluding 3 NRIs and 2 resident indians from promoter groups).

5.1 The Company has not received any intimation from suppliers regarding their status under the Micro, Small and Medium Enterprises Development Act, 2006 and hence disclosures relating to amount unpaid as at year end together with interest paid payable under this Act have not been given.

5.2 Trade Payables include Rs. 0.93 lacs (P.Y. Nil) to related parties (refer note 35)

6.1 There are no amounts due for payment to the Investor Education and Protection Fund Under Section 205C of the Companies Act, 1956 as at the year end. Section 125 of the Companies Act, 2013 which corresponds to Section 205C of the Companies Act, 1956 has not yet been enforced.

6.2 Statutory liabilities represent amounts payable towards VAT, CST, Excise duty and TDS etc.

6.3 Expenditure related to Corporate Social Responsibility as per Section 135 of the Companies Act, 2013 read with Schedule VII thereof : Rs.31.29 lakhs included in other administrative & general expenses.

7 Contingent Liabilities and Commitments (to the extent not provided for) (Rs. in Lacs)

As at As at 31st March, 2015 31st March, 2014

(a) Contingent Liabilities

1) Disputed matters in appeals/contested in respectof:

i. Income Tax 268.31 405.06

ii. Excise 193.45 183.75

iii. Service Tax 3.86 3.86

iv. Customs Department 11.71 11.71

Future cash outflows in respect of the above are determinable only on receipt of Judgments /decisions pending with various forums/ authorities. Based on the decisions of the Appellate authorities and the interpretations of other relevant provisions, the Company has been legally advised that the additional demand raised is likely to be either deleted or substantially reduced and accordingly no provision is considered necessary.

2) Letter of Credit 669.19 812.58

3) Bank Guarantee 471.78 432.29

(b) Commitments

i. Estimated amount of Contracts remaining to be executed on 82.85 683.51 capital account and not provided for, net of advances

8 Derivative Instruments and Unhedged Foreign Currency Exposure

The company enters into forward exchange contracts to hedge against its foreign currency exposures relating to the underlying transactions and firm commitments. The company does not enter into any derivative instruments for trading or speculative purposes.

9 Grant from World Bank

Government grants related to depreciable fixed assets was treated as deferred income which was recognised in the statement of profit and loss over the useful life of the asset. During the year the Company has changed the method of recognizing the government grant. Grants related to specific fixed assets are presented in balance sheet by showing the opening balance of deferred grant as a deduction from the gross value of the assets concerned in arriving at their book value. Thus grant is recognised in the statement of profit and loss over the useful life of a depreciable asset by way of a reduced depreciation charge. This change results in more appropriate preparation and presentation of financial statements of the Company.

10 Employees' Benefits Defined Benefit Plan Gratuity

The Company has a defined benefit gratuity plan. Every employee who has completed five years or more of service gets a gratuity on departure at 15 days salary (last drawn salary) for each completed year of service. The scheme is funded with Life Insurance Corporation of India and Star Union Dai-ichi Life insurance company in the form of qualifying insurance policy.

The following table sets out the funded status of the gratuity plan and the amounts recognised in the company's financial statements based on actuarial valuations being carried out as at 31st March 2015.

11 Related Party Disclosure

a) Names of related parties and nature of relationship

I. Key Management Personnel (KMP)

1. Shri Suresh J. Patel Chairman& Managing Director

2. Shri Bhavin S. Patel Executive Director

3. Shri Ankit S. Patel Executive Director

4. Shri Mayur B. Padhya Chief Financial Officer

5. Shri Ashutosh B. Bhatt Company Secretary

II. Enterprise under significant influence of key management personnel (Enterprise)

(i) Shanti Inorgo Chem (Guj.) Pvt. Ltd.

(ii) Siskaa Chemicals Ltd.(Associate concern till 01/ 04 /2013)

(iii) Rudraksh Caterers Pvt. Ltd.

III. Wholly-owned Subsidiary Company (WOS)

(i) Bodal Agrotech Ltd.

IV. Associates

(i) Sun Agrigenetics Pvt. Ltd.

(Associate Concern Till 24/02/2015 and Fellow Subsidiary Company (FS) till 07/03/2014)

Notes:-

(i) Loan to subsidiary has been given for acquisition of assets and other business purposes and has been utilized for the same.

(ii) No amounts pertaining to related parties have been provided for as doubtful debts. Also no amounts have been written off or written back during the year.

12 Segment Reporting:

The Company's primary segment is identified as business segment based on nature of products, risks, returns and the internal business reporting system and secondary segment is identified based on the geographical location of the customers as per Accounting Standard 17. The Company is principally engaged in a single business segment viz., "Dyes, Dyes Intermediates and Basic Chemicals".

The geographical segment has been considered for disclosure as secondary segment.

Two secondary segments have been identified based on the geographical locations of customers i.e. domestic and export.

a) Revenue from external operations comprises of income from sale of products, and other operating revenues.

b) Carrying amount of segment assets comprises of non-current assets and current assets identified to the respective segments. However Segments assets in India also includes certain common assets used to generate revenue in both segments but not feasible of allocation.

c) Capital expenditure during the year represents net additions to Tangible and Intangible assets and movement in Capital work in progress.

13 Previous year's figures have been rearranged and reclassified wherever necessary to correspond with the current year.

Mar 31, 2014

1 Contingent Liabilities and Commitments (to the extent not provided for) (Rs. in Lacs)

As at As at 31st March 31st March 2014 2013

(a) Contingent Liabilities

Disputed matters in appeals/ contested in respectof:

i. Income Tax 405.06 248.05

ii. Excise 183.75 112.47

iii. Service Tax 3.86 1.35

iv. Customs Department 11.71 11.71

(b) Commitments

i. Letter of credit 812.58 780.94

ii. Bank Guarantee 432.29 367.01

iii. Estimated amount of Contracts remaining to be executed on Capital account and not 683.51 0.41 provided for, net of advances

(c) During the year the company has received Income Tax Assessment orders u/s 143(3) r.w.s. 153A dated 21.03.2014 for the F.Y. 2005-06 to F.Y. 2010-11 and Income Tax Assessment order u/s 143(3) r.w.s. 153B (1)(b) for the F.Y. 2011-12 dated 21.03.2014.The disputed demand including interest for all seven Assessment Years is Rs. 405.06 lacs. Based on the decisions of the Appellate authorities and the interpretations of other relevant provisions, the Company has been legally advised that the demand is likely to be either deleted or substantially reduced and accordingly no provision is considered necessary.

2 Derivative Instruments and Unhedged Foreign Currency Exposure

The company enters into forward exchange contracts to hedge against its foreign currency exposures relating to the underlying transactions and firm commitments. The company does not enter into any derivative instruments for trading or speculative purposes.

3 Grant from World Bank

Grant from World Bank has been treated as deferred income which is recognized in the Statement of Profit & Loss for the period in the proportions in which depreciation on related assets is charged. During the year the company had retrospectively changed its method of providing deprecation on its tangible fixed assets as discussed in Note No.1.1(d)and accordingly income of Rs.13.63 lacs related to earlier years is transferred to prior period income accounts and income of Rs.1.34 lacs recognised during the current year.

4 EmployeesÂ Benefits

Defined Benefit Plan

Gratuity

The Company has a defined benefit gratuity plan. Every employee who has completed five years or more of service gets a gratuity on departure at 15 days salary (last drawn salary) for each completed year of service. The scheme is funded with LIC and Star Union Dai-ichi in the form of qualifying insurance policy.

The following table sets out the funded status of the gratuity plan and the amounts recognised in the companyÂs financial statements based on actuarial valuations being carried out as at 31st March 2014.

The estimated future salary increases take account of inflation, seniority, promotion and other retirement factors such as supply and demand in the employment markets.

The expected contributions for Defined Benefit Plan for the next financial year will be in line with F.Y. 2013-14

Defined Contribution Plan

The company has recognized the following amount in statement of profit and loss which is included under contribution to funds.

5 Related Party Disclosure

a) Names of related parties and nature of relationship

I. Key Management Personnel (KMP)

1. Shri Suresh J. Patel Chairman& Managing Director

2. Shri Bhavin S. Patel Executive Director

3. Shri Ankit S. Patel Executive Director

4. Shri Ramesh P. Patel Key Managerial Personnel - Executive Director (till 01/10/2012)

II. Enterprise under significant influence of key management personnel (Enterprise)

(i) Shanti Inorgo Chem (Guj.) Pvt. Ltd.

(ii) Siskaa Chemicals Ltd.(Associate concern till 01/ 04 /2013)

III. Wholly-owned Subsidiary Company (WOS)

(i) Bodal Agrotech Ltd.

IV. Associates

(i) Sun Agrigenetics Pvt. Ltd. (Fellow Subsidiary Company (FS) till 07/03/2014)

Notes:-

(i) No amounts pertaining to related parties have been provided for as doubtful debts. Also no amounts have been written off or written back during the year.

6 Segment Reporting:

a) Primary Segment

The company primarily deals in only one business segment i.e., ÂDyes, Dyes Intermediates and Basic ChemicalsÂ.

b) Secondary Segment (By Geographical segment)

Two secondary segments have been identified based on the geographical locations of customers : domestic and export. Information about geographical segments are as below.

Mar 31, 2013

1 Company Information:

Bodal Chemicals Limited (the ''Company'') is a public limited company listed on the Bombay Stock Exchange (BSE) and the National Stock Exchange (NSE). The company is engaged in manufacturing of Dyes, Dyes Intermediates and Basic Chemicals.

The Company has a wholly owned subsidiary Bodal Agrotech Ltd., which is in the business of trading of vegetables, fruits and food grains.

2. Contingent Liabilities not provided in respect of:

(Rs. In lacs)

Nature of Liabilities 2012-13 2011-12

a. Disputed matters in appeals/contested in respect of:

I) Income Tax 248.05 248.05

II) Excise 17.38 20.21

III) Service Tax 96.44 96.67

IV) Customs Department 11.71 10.11

b. Letter of credit 780.94 264.15

c. Estimated amount of Contracts, remaining to be executed 0.41 3.54 on capital account (net of advances)

d. Bank Guarantee 367.01 423.63

3 The Company has exercised the option of implementing the Provisions of Paragraph 46 of Accounting Standard 11 " Accounting for the Effects of changes in Foreign Exchange RatesÂ prescribed by Companies (Accounting Standards) Amendment Rules , 2009 in the F.Y. 2008-09 and accordingly the company has capitalized foreign exchange loss of Rs. 81.08 lacs in the current year in respect of foreign currency loans, consequently, loss for the year is lower by the equivalent amount. Company had capitalised the foreign exchange loss of Rs. 1488.03 lacs in respect of foreign currency loans in the fixed assets upto the previous year.

4. Grant from World Bank

Grant from World Bank has been treated as deferred income which is recognized in Profit & Loss Account for the period in the proportions in which depreciation on related assets is charged.

5. Related Party Disclosure

a) Names of related parties and nature of relationship

I. Key Management Personnel (KMP)

1. Shri Suresh J. Patel Chairman & Managing Director

2. Shri Bhavin S. Patel Executive Director

3. Shri Ankit S. Patel Executive Director

4. Shri Ramesh P. Patel Executive Director(till 01/10/2012)

II. Enterprise under significant influence of key management personnel (Enterprise)

(i) Shanti Inorgo Chem (Guj.) Pvt. Ltd. (ii) Siskaa Chemicals Ltd.

III. Wholly-owned Subsidiary Company (WOS)

(i) Bodal Agrotech Ltd.

IV. Fellow Subsidiary Company (FS)

(i) Sun Agri genetics Pvt. Ltd.

6. Employees'' Benefits

a) Defined Benefit Plan

Gratuity:

The Company has a defined benefit gratuity plan. Every employee who has completed five years or more of service gets a gratuity on departure at 15 days salary (last drawn salary) for each completed year of service. The scheme is funded with LIC and Star Union Dai-ichi in the form of qualifying insurance policy.

The following table summaries the components of net benefit expenses recognized in the profit and loss account and the funded status and amounts recognized in the balance sheet for the gratuity benefit.

7. Earnings per Equity Share

Basic and Diluted Earnings per equity share are recorded in accordance with Accounting Standard -20 "Earnings per ShareÂ. Earnings per Share is calculated by dividing the (loss) / profit attributable to the Equity shareholders (after adjustment for deferred taxes) by the average number of equity shares outstanding during the period. The numbers used in calculating basic earnings per Equity Shares are stated below.

8 On February 9 & 10, 2012 the Company, along with promoters and other related parties, were subject to Search, Survey and seizure operation by the income Tax department under section 132/133 of Income Tax Act 1961 ("the ActÂ) The Company had during the year received notice u/s153A for filing return of income for six financial years preceding to financial year 2011-12 the year of search. The company had already filed return of income for the respective 6 years in response to notice u/s 153A.

The company has till date made disclosure of Rs.1081.23 lacs under section 132(4) of the Act of which Rs. 505 Lacs has been accepted by the company and said income were shown as "Exceptional ItemsÂ in statement of profit and loss for year ended 31-03-2012. Balance Rs. 576.23 lacs though covered under disclosure have not been accepted by the company. However the same has been shown as additional income in return of income filed for respective years to buy peace & to avoid litigation. There hasn''t been any monetary tax implication of such income due to availability of additional unabsorbed deprecation arising out of order giving appeal effect of "Income Tax Appellate TribunalÂ in favour of erstwhile amalgamated company "Milestone Organic LimitedÂ.

Due to above, necessary adjustments have also been made in the calculation of deferred tax. The deferred tax calculation has been made as on 31-03-2013 keeping in view the additional income offered by the company & additional unabsorbed deprecation available as mentioned above.

9 Previous year''s figures have been rearranged and reclassified wherever necessary.

Mar 31, 2012

1. Company Information:

Bodal Chemicals Limited (the 'Company') is a public limited company listed on the Bombay Stock Exchange (BSE) and the National Stock Exchange (NSE). The company is a market leader in the Dyes, Dyes Intermediates and Basic Chemicals.

The Company has a wholly owned subsidiary Bodal Agrotech Ltd., which is in the business of trading of vegetables, fruits and food grains.

2.1 Equity shares of Rs. 10 each have been sub-divided into five equity shares of Rs. 2 each pursuant to the resolution passed by the shareholders at the Extra Ordinary Meeting on 28/04/2010

2.2 Out of total shares outstanding 3,38,060 Equity shares had been alloted as fully paid on amalgamation of Milestone Organics Ltd. with the company as per High Court Order.

2.3 The Company has only one class of equity shares having a par value of Rs. 2/- per share. Each shareholder is eligible for one vote per share. 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 of their shareholding.

3.1 Term Loans are collateraly further secured by equitable mortgage on Immovable property and Hyp. Of P&M of the company. It is further secured by personal guarantees of the Chairman and Managing Director and Executive directors. It is further secured by pledge of equity shares of the company held by the directors.

3.2 Installments falling due in respect of all the above Loans upto 31/03/2013 have been grouped under "Current maturities of long-term debt".

3.4 Company had moved proposal, for restructuring of its various bank loans, to Corporate Debt Restructure Cell through Union Bank of India, the Monitoring Institution (MI). The same has been admitted by the Cell in their meeting dtd. 25/ 06/2012 with cut off date as 01/04/2012. The MI need to submit final restructure report by 22/09/2012. On approval of the same by CDR Cell, various bank limits will get restructured including repayment schedule for the same. That proposed changes have not been considered while preparing this accounts.

3.5 Cash Credit Facility and Packing Credit Facility are primarily secured by Hyp. Of Stock of Raw material, Work in Process, Finished Goods and Book Debts of the company.

3.6 Bills discounting facility is primarily secured by hyp. of bills drawn under letter of credit.

3.7 Buyers' Credit facility is primarily secured by hyp. Of stocks received under letter of credit.

4.1 Cash Credit, Packing Credit, Bill Discounting and Buyers Credit facility are collateraly further secured by equitable mortgage on Immovable property and Hyp. Of P&M of the company and personal guarantees of the Chairman and Managing Director and Executive directors. It is further secured by pledge of equity shares of the company held by the directors.

5.1 Other Trade payables represents amount payable to various parties for packing material, consumables and expenses.

5.2 The Company has not received any intimation from suppliers regarding their status under the Micro, Small and Medium Enterprises Development Act, 2006 and hence disclosures relating to amount unpaid as at year end together with interest paid payable under this Act have not been given.

* There are no amounts due for payment to the Investor Education and Protection Fund Under Section 205C of the Companies Act, 1956 as at the year end.

# Statutory liabilities represent amounts payable towards VAT, CST, Excise duty and TDS etc.

6. Contingent Liabilities not provided in respect of:

(Rs. In lacs)

Nature of Liabilities 2011-12 2010-11

a.Disputed matters in appeals/ contested in respect of:

I) Income Tax 248.05 92.84

II) Excise 20.21 1.18

III) Service Tax 96.67 96.08

IV) Customs Department 10.11 10.11

b. Letter of credit 264.15 690.85

c. Estimated amount of Contracts, remaining to be executed on 3.54 42.89 capital account (net of advances)

d. Bank Guarantee 423.63 260.74

7. The Company has exercised the option of implementing the Provisions of Paragraph 46 of Accounting Standard 11 " Accounting for the Effects of changes in Foreign Exchange Rates" prescribed by Companies (Accounting Standards) Amendment Rules , 2009 in the F.Y. 2008-09 and accordingly the company has capitalized foreign exchange loss of Rs. 392.66 lacs in the current year in respect of foreign currency loans, consequently, loss for the year is lower by the equivalent amount. Company had capitalised the foreign exchange loss of Rs. 1095.37 lacs in respect of foreign currency loans in the fixed assets upto the previous year.

8. Grant from World Bank

Grant from World Bank has been treated as deferred income which is recognized in Profit & Loss Account for the period in the proportions in which depreciation on related assets is charged.

Notes:-

(i) No amounts pertaining to related parties have been provided for as doubtful debts. Also no amounts have been written off or written back during the year.

8. On February 9 & 10, 2012 the Company, along with promoters and other related parties, were subjected to Search, Survey and seizure operation by the Income Tax department under section 132 / 133 of the Income Tax Act, 1961 ("the Act"). The company has till date made disclosure of Rs. 1081.23 lacs under Section 132 (4) of the Act of which Rs. 505 lacs has been accepted by the company and the said income has been shown as "Exceptional Items". Utilisation thereof of Rs. 500 lacs towards land development cost and Rs. 5 lacs for reversal of business development expenses have been duly accounted for. Balance Rs. 576.23 lacs though covered under disclosure have not been accepted by the company. The above disclosure has been considered for calculation of the tax expenses.

9. Employees' Benefits

a) Defined Benefit Plan

Gratuity:

The Company has a defined benefit gratuity plan. Every employee who has completed five years or more of service gets a gratuity on departure at 15 days salary (last drawn salary) for each completed year of service. The scheme is funded with an insurance Company in the form of qualifying insurance policy.

The following table summaries the components of net benefit expenses recognized in the profit and loss account and the funded status and amounts recognized in the balance sheet for the gratuity benefit.

10. Earnings per Equity Share

Basic and Diluted Earnings per equity share are recorded in accordance with Accounting Standard -20 "Earnings per Share". Earnings per Share is calculated by dividing the (loss) / profit attributable to the Equity shareholders (after adjustment for deferred taxes) by the average number of equity shares outstanding during the period. The numbers used in calculating basic and diluted earnings per Equity Shares are stated below.

Mar 31, 2011

1) Contingent Liabilities not provided in respect of: (Rs. In Lacs)

Nature of Liabilities 2010-11 2009-10

a. Disputed matters in appeals/contested in respect of:

I) Income Tax 92.84 63.18

II) Excise Department 97.26 22.94

III) Custom Department 10.11 10.11

b. Bonds/Undertakings given by the Company under Concessional duty/ Nil 0.63 exemption to Customs/Excise Authorities (Net of redemption applied for)

c. Letter of credit 690.85 550.18

d. Estimated amount of Contracts, remaining to be executed on capital account 42.89 851.91 (net of advances)

e. Bank Guarantee 260.74 Nil

2) A) In terms of approval of shareholders of the Company at the Extra Ordinary General Meeting held on April 28, 2010 and as per the applicable provisions of Securities and Exchange Board of India (ICDR) Regulations, 2009, the company has allotted 67,50,000 warrants on preferential basis on May 11, 2010, to promotersÃ group and non- promoters at Rs. 63/- each to be converted into equal number of equity shares of Rs. 10/- each at a premium of Rs. 53/- per share on exercise of the option of conversion by the warrant holders within 18 months from the date of the allotment of warrants i.e. May 11, 2010. As per terms and conditions of said issue, the company has received Rs. 15.75 per warrant i.e. 25% of Rs. 63/-, aggregating Rs.1063.13 lacs for allotment of warrants from allottees.

During the year, on 11-06-2010, the company has sub divided (stock split) one equity share of Rs. 10/- each into 5 equity shares of Rs.2/- each. Hence, after considering subdivision/split, each warrant of Rs. 63 will be converted into 5 equity shares of face value of Rs. 2/- each on or before 10th November, 2011. At the time of conversion, issue price of equity shares will be adjusted accordingly.

3) The Company has exercised the option of implementing the Provisions of Paragraph 46 of Accounting Standard 11 Ã Accounting for the Effects of changes in Foreign Exchange RatesÃ prescribed by Companies (Accounting Standards) Amendment Rules , 2009 in the F.Y. 2008-09 and accordingly Company has capitalized foreign exchange loss of Rs 407.60 lacs in the current year in respect of foreign currency loans, consequently, profit for the year is higher by the equivalent amount. Company had deducted the foreign exchange gain of Rs. 73.15 lacs in respect of foreign currency loans from the Fixed Assets during the previous year.

4) Grant from World Bank

Grant from World Bank have been treated as Deferred Income which is recognized in Profit & Loss Account for the period and in the proportions in which depreciation on related assets is charged.

5) Micro, Small, Medium Enterprises Development Act, 2006

There are no Micro, Small and Medium Enterprises to whom the company owes dues, which are outstanding for more than 45 days as at 31st March, 2011. This information as required to be disclosed under the Micro, Small and Medium Enterprises Development Act, 2006 has been determined to the extent such parties have been identified on the basis of information available with the company.

6) Sundry debtors include Rs. 64.35 lacs, the recovery of which is doubtful. However, in the opinion of the management considering the recovery procedures the same are receivable and hence not considered doubtful and accordingly no provided for.

7) Related Party Disclosure

a. Names of related parties and nature of relationship

I. Key Management Personnel

1. Shri Suresh J. Patel Chairman & Managing Director

2. Shri Bhavin S. Patel Executive Director

3. Shri Ankit S. Patel Executive Director

4. Shri Ramesh P. Patel Executive Director

II. Enterprise under significant influence of key management personnel

(i) Shanti Inorgo Chem (Guj.) Pvt. Ltd.

(ii) Siskaa Chemicals Ltd. (formerly known as Siskaa Chemicals Pvt. Ltd.)

III. Wholly-owned Subsidiary Company

(i) Bodal Agrotech Ltd.

IV. Fellow Subsidiary Company

(i) Sun Agrigenetics Pvt. Ltd.

8) Segment Reporting:

a) Primary Segment

The company has only one segment i.e., ÃDyes, Dyes Intermediates and Basic ChemicalsÃ.

9) EmployeesÃ Benefits

a) Defined Benefit Plan

Gratuity:

The Company has a defined benefit gratuity plan. Every employee who has completed five years or more of service gets a gratuity on departure at 15 days salary (last drawn salary) for each completed year of service. The scheme is funded with an Insurance Company in the form of qualifying insurance policy.

10) The Board of Directors in its meeting held on April 3, 2010 has approved sub-division (share split) of existing equity shares of Rs. 10 each into 5 equity shares of Rs. 2 each, which was duly approved by the shareholders in Extra Ordinary General Meeting held on April 28, 2010.

11) Debenture

The Company has exercised early redemption of 10% Non Convertible Debentures of Rs. 512.55 lacs on 06/05/2010, which were due for redemption on or before 29/09/2011. As per written consent by the Debenture holder, he has agreed not to claim any interest up to 06/05/2010. Hence, no provision for interest on Debenture has been made for the year 2010 Ã 2011.

12) Previous year figures have been rearranged and reclassified wherever necessary.

Mar 31, 2010

1) Contingent Liabilities not provided in respect of: (Rs.In Lacs)

Nature of Liabilities 2009-10 2008-09

a. Disputed matters in appeals/conte sted in respect of:

I) Income Tax 63.18 19.28

II) Excise Department 22.94 9.07

III) Custom Department 10.11 10.11

b. Bonds/Undertakings given by the Com pany under Concessional duty/

exemption to Customs/Excise Authorities (Net of redemption applied for) 0.63 12.60

c. Letter of credit 550.18 622.12

d. Estimated amount of Contracts, rema ining to be executed on capital account (net of advances) 851.91 1950.30

2) The Company has exercised the option of implementing the F rovisions of Paragraph 46 of Accounting Standard 11 Ã Accounting for the Effects of changes in Foreign Exchange R^sÃ prescribed by Companies (Accounting Standards) Amendment Rules , 2009 in the F.Y. 2008-09 and accordingly Company has deducted the foreign exchange gain of Rs. 73.15 lacs in respect of foreign currency loans from the Fixed Assets during the current Financial Year, consequently profit for the year is lower by the equivalent amount. Company had capitalized Exchange Difference Loss of Rs. 761.38 lacs in the previous year in respect of foreign currency loans.

3) Grant from World Bank

Grant from World Bank of Rs. 1 Crore received earlier has been, in the current year considered as grant related to depreciable assets and accordingly have been treated as Deferred Income which is recognized in Profit & Loss Account for the period and in the proportions in which depreciation on related assets is charged. Accordingly Rs. 5.28 lacs have been recognized in the current yearÃs Profit & Loss Account and Rs. 56.51 lacs which pertains to prior year deferred income in the proportion in which depreciation on related assets had been charged in the prior years have been considered as prior period income. y

4) Micro, Small, Medium Enterprises Development Act, 2006

There are no Micro, Small and Medium Enterprises to whom the company owes dues, which are outstanding for more than 45 days as at 31st March, 2010. This information as required to be disclosed under the Micro, Small and Medium Enterprises Development Act, 2006 has been determined to the extent such parties have been identified on the basis of information available with the company.

5) Sundry debtors include Rs. 64.35 lacs the recovery of which is doubtful. However, in the opinion of the management considering the recovery procedures the same are receivable and hence not considered doubtful and accordingly not provided for.

6) Remuneration to Directors

a) Remuneration to Managing Director / Executive Directors

b) Computation of net profit in accordance with Section 349 of the Companies Act, 1956

7) Auditors Remuneration

8) Related Party Disclosure

a) Names of related parties and nature of relationship Management Personnel

II. Enterprise under significant influence of key management personnel

(i) Inorgo Chem (Guj) Pvt. Ltd. b) Transactions with related parties

Notes:-

(i) No amounts pertaining to related parties have been provided for as doubtful debts. Also no amounts have been written off or written back during the year.

8) Segment Reporting:

a) Primary Segment

The company has only one segment i.e., "Dyes and Dyes Intermediates"

b) Secondary Segment (By Geographical segment) Sales and Operating Income:-

9) Deferred Taxation

The significant component and classification of deferred tax assets and liabilities on account of timing differences are:

10) Employees Benefits

a) Defined Benefit Plan Gratuity:/

The Company has a defined benefit gratuity plan. Every employee who has completed five years or more of service gets a gratuity on departure at 15 days salary (last drawn salary) for each completed year of service. The scheme is funded with an Insurance Company in the form of qualifying insurance policy. The following table summaries the components of net benefit expenses recognized in the profit and loss account and the funded status and amounts recognized in the balance sheet for the gratuity benefit.

3 Table showing changes in the fair value of plan assets

4 Table showing fair value of plan assets

5 Actuarial Gain/Loss recognized

6 The amounts to be recognized in the balance sheet and statements of profit and loss

7 Expenses Recognised in statement of Profit & loss

b) Defined Contribution Plan

The company has recognized the following amount in profit and loss account which is included under contribution to funds.

Note:

(1) The estimated future salary increases take account of inflation, seniority, promotion and other retirement factors such as supply and demand in the employment markets.

11) Earnings per Equity Share

Basic and Diluted Earnings per equity share are recorded in accordance with Accounting Standard -20 Earning per Share". Earning per Share is calculated by dividing the profit attributable to the Equity shareholders (after adjustment for deferred taxes) by the average number of equity shares outstanding during the period. The numbers used in calculating basic and diluted earnings per Equity Shares are stated below.

12) Foreign Currency Exposure

The company has entered in following forward exchange contracts that are outstanding as at 31st March, 2010 to hedge the foreign currency risks of firm commitments.

All Derivative and Financial instruments acquired by the company are for Hedging purpose only. Details of unhedged foreign currency exposure as on 31-03-2010.

13) Debenture

10% Non Convertible Debentures of Rs. 512.55 lacs will be due for redemption on 29/09/2011. However, the same has been redeemed on 06/05/2010 which is before the date of signing of the Balance Sheet.

14) Additional information pursuant to the Provisions of para 3, 4C and 4D of Part II of Schedule VI to the Companies Act, 1956:

[A] (I) RAW MATERIAL CONSUMPTION :

(II) PACKING MATERIAL : [B] COMPOSITION OF RAW MATERIALS CONSUMPTION

[C] TURNOVER : (Figures for Previous year given in brackets) (I) DETAILS OF MANUFACTURING TURNOVER

(II) DETAILS OF FINISHED GOODS TRADED

(III) DETAILS OF RAW MATERIAL TRADED

[D] DETAILS OF JOB WORK CHARGES RECEIVED (Figures for Previous year given in brackets)

[E] LICENCED and INSTALLED CAPACITY

[F] VALUE OF IMPORTS ON CIF BASIS (in Lacs)

[G] EARNING IN FOREIGN CURRENCY (in Lacs)

[H] EXPENDITURE IN FOREIGN CURRENCY (in Lacs)

15) Previous year figures have been rearranged and reclassified wherever necessary.

16) Balance sheet Abstract and CompanyÃs General Business Profile : I. Registration Details

II. Capital Raised During the year (Amount Rs in Thousands)

III. Position of Mobilisation and Deployment of Funds

IV. Performance of the Company(Amount Rs in Thousands)

Mar 31, 2009

1) Contingent Liabilities not provided in respect of:

(Rs. In Lacs)

Nature of Liabilities 2008-09 2007-08

a. Disputed matters in appeals/ contested in respect of:

I) Income Tax 19.28 6.24

II) Excise Department 9.07 10.91

III) Custom Department 10.11 10.07

b. Bonds/Undertakings given by the Company under Concessional duty/ exemption to Customs/Excise Authorities(Net of redemption applied for) 12.60 53.60

c. Letter of credit 622.12 562.27

d. Estimated amount of Contracts, remaining to be executed on capital account 1950.30 165.79

2) In the opinion of the Board of Directors, Current assets, loans and advances have a value on realisation in the ordinary course of business equal to the amount at which they are stated in the Balance Sheet.

3) The company, in terms of Notification issued by Ministry of Corporate Affairs on 31st March, 2009, has exercised the option of implementing the provisions of newly inserted Paragraph 46 of Accounting Standard 11, Accounting for the Effects of Changes in Foreign Exchange Rates, prescribed by Companies (Accounting Standards) Amendment Rules, 2009. The company has outstanding long term foreign currency loans which are categorized as Long Term Foreign Currency Monetary Item as referred in the said notification. Accordingly company has adjusted the exchange difference gain of Rs.40.17 lacs pertaining to prior years through general reserves and corresponding deduction in Fixed Assets and capitalized Exchange Difference Loss of Rs. 761.38 lacs pertaining to current financial year in respect of Foreign Currency Loans, consequently profit for the year is higher by equivalent amount.

4) Rights Issue and Detachable Warrants to the equity shareholders of the Company.

During the year Company completed Rights Issue of 52,01,352 Equity Shares along with Detachable Warrants at a price of Rs. 20/- each (Face Value of Rs.10/- and Premium of Rs. 10/- per share) aggregating to Rs. 1040.27 lacs. Detachable Warrants holder can exercise their right to apply for the Equity Shares at the Exercise Price of Rs.20/- per share at any time during the Warrant Exercise Period i.e. 1st to 28th February, 2009. Consequently on exercise of the right 42,30,634 shares were allotted at the price of Rs.20/- each (Rs.10A Face Value and Rs.10/- Premium per share). Consequently the share capital of the Company increased from Rs.10.40 Crores to Rs.19.83 Crores on allotment of 94,31,986 Equity Shares.

5) Micro, Small, Medium Enterprises Development Act, 2006

There are no Micro, Small and Medium Enterprises, as defined in the Micro, Small and Medium Enterprises Development Act, 2006 to whom the Company owes dues on account of principal amount together with interest and accordingly no additional disclosures have been made.

The above information regarding Micro, Small and Medium Enterprises has been determined to the extent such parties have been identified on the basis of information available with the Company. This has been relied upon by the auditors.

6) Sundry debtors include Rs. 64.35 lacs. The recovery of wherein are doubtful. However, in the opinion of the management considering the recovery procedures the same are receivable and hence not considered doubtful and accordingly not provided for.

7) Balance of Unsecured Joans, debtors and creditors, ioans and advances are subject to confirmation.

8) Debenture

As per written consent by the unsecured Debenture holder, it has been agreed not to claim any interest upto 31/03/ 2009. Hence, no provision has been made for interest for the year 2008-09.

9) Employees Retirement Benefits

a) Defined Benefit Plan

Gratuity:

The Company has a defined benefit gratuity plan. Every employee who has completed five years or more of service gets a gratuity on departure at 15 days salary (last drawn salary) for each completed year of service. The scheme is funded with an issuance company in the form of qualifying insurance policy.

The following table summaries the components of net benefit expenses recognized in the profit and loss account and the funded status and amounts recognized in the balance sheet for the gratuity benefit.

10) Previous year figures have been rearranged and reclassified wherever necessary.

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