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Notes to Accounts of Gokaldas Exports Ltd.

Mar 31, 2016

(b) Terms / rights attached to equity shares

The Company has only one class of equity shares having a par value of Rs. 5 per share. Each holder of equity is entitled to one vote per share. The Company declares and pays dividend in Indian rupees. The dividend proposed by the Board of Directors is subject to the approval of the shareholders in ensuing Annual General Meeting.

In event of liquidation of the Company, the holders of equity shares would be entitled to receive remaining assets of the Company, after distribution of all preferential amounts. The distribution will be in proportion to the number of equity shares held by the shareholders.

As per records of the Company, including its register of shareholders / members and other declaration received from shareholders regarding beneficial interest, the above shareholding represent both legal and beneficial ownership of shares.

(e) Shares reserved for issue under options

For details of shares reserved for issue under the employee stock option (ESOP) plan of the Company, please refer note 38.

(a) Working capital loan from bank carries interest at 14.45% (2015: 14.95%) p.a. The loan is repayable in 35 monthly installments of Rs 184 lakhs each and a final installment of Rs 160 lakhs, after moratorium of 12 months from the date of loan. The loan is secured by certain land and buildings and fixed deposit of Rs 402 lakhs.

(e) The Company is also involved in certain litigations with third parties, the impact of which is not quantifiable. These cases are pending with various courts / forums and are scheduled for hearings. After considering the circumstances and legal evaluation thereon, the Company''s management believes that these cases will not have any adverse impact on the financial statements.

1. Gratuity

The Company has a defined benefit gratuity plan. Every employee who has completed five years or more of service gets a gratuity on retirement or termination 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 a qualifying insurance policy.

The following tables summaries the components of net benefit expense recognized in the statement of profit and loss and the funded status and amounts recognized in the balance sheet:

Notes:

2. The estimate of future salary increases considered in actuarial valuation takes into account inflation, seniority, promotion and other relevant factors such as supply & demand in the employment market.

3. The estimated rate of return on plan assets is determined based on the market prices prevailing on that date, applicable to the period over which the obligation is to be settled.

4. The Company expects to contribute Rs.706.38 lakhs to gratuity fund in 2016-17.

5. Segment information

a) Primary business segment

The Company is engaged in a single business segment of sale of garment, and hence, no additional disclosures are required, other than those already given in the financial statements.

6. Related party disclosures

A. Names of related parties and description of relationship:

Description of Relationship Names of related parties

a. Parties where control exists:

Immediate Holding Company Blackstone FP Capital Partners (Mauritius) V-B

Subsidiary Limited

Ultimate holding Company Blackstone FP Capital Partners (Mauritius)

V-B Limited

Wholly owned subsidiaries All Colour Garments Private Limited

Deejay Trading Private Limited Glamourwear Apparels Private Limited Madhin Trading Private Limited Magenta Trading Private Limited Rafter Trading Private Limited Rajdin Apparels Private Limited Reflexion Trading Private Limited Rishikesh Apparels Private Limited Seven Hills Clothing Private Limited SNS Clothing Private Limited Vignesh Apparels Private Limited

b. Key management personnel:

Director and Chief Executive Officer Gautam Chakravarti (resigned effective May 25, 2015) Vice Chairman & Managing Director Padala Ramababu (appointed effective May 25, 2015) Chief Financial Officer (CFO) Sumit Keshan (resigned effective Nov 15, 2015)

Chief Financial Officer (CFO) Sathyamurthy A

(appointed effective Nov 16, 2015)

Company Secretary Ramya Kannan

7. Leasing arrangements

The Company''s leasing arrangements in respect of its office, factory and residential premises are in the nature of operating leases. These leasing arrangements, which are usually cancellable at the option of the lessee, are for a total period ranging from eleven months to sixty six months and are renewable with mutual consent. All leases include a clause to enable upward revision of the rental charge on a periodic basis as specified under the rental agreement. The charge on account of lease rentals for the year is Rs. 2,123.20 lakhs (2015: Rs. 885.58 lakhs).

8 Employee stock option Plans (Equity Settled)

In September 2010, the shareholders of the Company approved Stock Option Plan (ESOP 2010) in accordance with the guidelines issued by the Securities and Exchange Board of India (SEBI) for Employees Stock Options Plan. The plan covered all employees of the Company including employees of subsidiaries and directors and provided for the issue of 1,718,800 shares of Rs. 5 each. The Company follows intrinsic method of accounting for stock compensation cost pursuant to the Guidance Note on "Accounting for Employee Share - Based Payments" issued by the "Institute of Chartered Accountants of India".

Nil (2015: 85,000) options have been granted during the year and 408,339 (2015: 1,136,668) are outstanding as at March 31, 2016. The vesting period ranges from 1 to 7 years. Weighted average of remaining contractual life is 7.37 years (2015: 8.35 years). The weighted average exercise price of all the options is Rs. 42.34 (2015: Rs. 40.89). There is no compensation cost since the exercise price is equal to the intrinsic value as at the date of grant.

The weighted average fair value of options granted during the year was Rs. Nil (2015: Rs.55.86). The Black Scholes valuation model has been used for computing the weighted average fair value considering the following inputs:

* Not applicable since no ESOP''s were granted during the year.

The expected life of the stock is based on historical data and current expectations and is not necessarily indicative of exercise patterns that may occur. The expected volatility reflects the assumption that the historical volatility over a period similar to the life of the options is indicative of future trends, which may also not necessarily be the actual outcome.

9 During the year ended March 31, 2016, the Company has recognized deferred tax asset to the extent that there is virtual certainty supported by convincing evidence based on the future profitability and projections of the Company, backed by confirmed customer orders on hand as at the year end. The Management believes that there is sufficient assurance that future taxable income will be available against which the deferred tax assets can be realized.

10 The Company is in process of taking necessary steps to comply with the Transfer Pricing requirements relating to the preparation & maintenance of the Transfer Pricing documentation with respect to the specified domestic transactions entered into by the Company during financial year ended March 31, 2016. The Management is of the opinion that the specified domestic transactions are at arm''s length and hence the aforesaid legislation will not have any impact on the standalone financial statements, particularly on the amount of tax expense and that of provision for taxation.

11 The Company had filed petition with the Company Law Board for compounding of offence u/s. 297 of the erstwhile Companies Act, 1956 for the transactions entered with CMS Info Systems Private Limited between July 2009 to October 2011 and as at date, the petition is pending with the Company Law Board.

For periods subsequent to October 2011, the Company had filed an application with Central Government, Ministry of Corporate Affairs, seeking its approval u/s. 297(1) of the erstwhile Companies Act, 1956 for entering into contract with CMS Info Systems Private Limited which is pending approval.

12 Previous year comparatives

Previous year figures have been regrouped/re-arranged/reclassified, wherever necessary to confirm to the current year''s presentation.


Mar 31, 2015

1. During the year, the Company continued to incur substantial losses i.e. Rs. 919.73 lakhs before exceptional gain of Rs. 4,355.31 lakhs (2014 - loss of Rs. 721.42 lakhs) and has accumulated losses of Rs 12,777.25 lakhs (2014 - Rs. 16,099.37 lakhs) as at March 31, 2015. The management has taken several measures to cut costs and improve productivity and is reasonably confident of improved profitability in coming years. Based on the future business plan, the Company is confident of funding its operating and capital expenditure and continue business operations in the foreseeable future. Accordingly, these financial statements have been prepared on a going concern basis.

The Company has only one class of equity shares having a par value of Rs. 5 per share. Each holder of equity is entitled to one vote per share. The Company declares and pays dividend in Indian rupees. The dividend proposed by the Board of directors is subject to the approval of the shareholders in ensuing Annual General Meeting.

In event of liquidation of the Company, the holders of equity shares would be entitled to receive remaining assets of the Company, after distribution of all preferential amounts. The distribution will be in proportion to the number of equity shares held by the shareholders.

As per records of the Company, including its register of shareholders/ members and other declaration received from shareholders regarding beneficial interest, the above shareholding represent both legal and beneficial ownership of shares.

(e) Shares reserved for issue under options

For details of shares reserved for issue under the employee stock option (ESOP) plan of the Company, please refer note 38.

(a) Working capital loan from bank carries interest at 14.95% p.a. (2014: 14.7%) The loan is repayable in 35 monthly instalments of Rs 184 lakhs each and a final instalment of Rs 160 lakhs, after moratorium of 12 months from the date of loan. The loan is secured by certain land and buildings and fixed deposit of Rs 402 lakhs.

(b) Current maturities disclosed under the head current liabilities [Refer Note 9]

2. Contingent liabilities (to the extent not provided for)

March 31, 2015 March 31, 2014

(a) Claims against the Company not 336.49 308.48 acknowledged as debts

(b) Guarantees given by banks - 2.00

(c) Outstanding letters of credit 4,574.76 1,680.56

(d) Bills of exchange discounted 10,711.33 9,372.68 with banks

(e) The Company is also involved in certain litigations with third parties, the impact of which is not quantifiable. These cases are pending with various courts/forums and are scheduled for hearings. After considering the circumstances and legal evaluation thereon, the Company's management believes that these cases will not have any adverse impact on the financial statements.

3. Gratuity

The Company has a defined benefit gratuity plan. Every employee who has completed five years or more of service gets a gratuity on retirement or termination 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 a qualifying insurance policy.

The following tables summaries the components of net benefit expense recognised in the statement of profit and loss and the funded status and amounts recognised in the balance sheet:

Notes:

1. The estimate of future salary increases considered in actuarial valuation takes into account inflation, seniority, promotion and other relevant factors such as supply & demand in the employment market.

2. The estimated rate of return on plan assets is determined based on the market prices prevailing on that date, applicable to the period over which the obligation is to be settled.

3. The Company expects to contribute Rs.792.68 lakhs to gratuity in 2015-16.

4. Segment information

a) Primary business segment

The Company is engaged in a single business segment of sale of garment, and hence, no additional disclosures are required, other than those already given in the financial statements.

b) Secondary business segment (by geographical area based on location of customers):

The Company mainly operates in two geographical areas of the world, i.e., India and Rest of World, the details of which are as below:

5. Related party disclosures

A. Names of related parties and description of relationship:

Description of Relationship Names of related parties

a. Parties where control exists:

Immediate Holding Company Blackstone FP Capital Partners (Mauritius)

Subsidiary Limited

Ultimate holding Company Blackstone FP Capital Partners (Mauritius)

V-B Limited

Wholly owned subsidiaries All Colour Garments Private Limited

Deejay Trading Private Limited

Glamourwear Apparels Private Limited

Madhin Trading Private Limited

Magenta Trading Private Limited

Rafter Trading Private Limited

Rajdin Apparels Private Limited

Reflexion Trading Private Limited

Rishikesh Apparels Private Limited

Robot Systems Private Limited

Seven Hills Clothing Private Limited

SNS Clothing Private Limited

Vignesh Apparels Private Limited

b. Key management personnel:

Director and Chief Executiv Mr. Gautam Chakravarti Officer

Chief Financial Officer Mr. Sumit Keshan (CFO)

6. Leasing arrangements

The Company's leasing arrangements in respect of its office, factory and residential premises are in the nature of operating leases. These leasing arrangements, which are usually cancellable at the option of the lessee, are for a total period ranging from eleven months to six years and are renewable with mutual consent. All leases include a clause to enable upward revision of the rental charge on a periodic basis as specified under the rental agreement. The charge on account of lease rentals for the year is Rs. 885.58 lakhs (2014: Rs. 744.63 lakhs).

7. Employee stock option Plans (Equity Settled)

In September 2010, the shareholders of the Company approved Stock Option Plan (ESOP 2010) in accordance with the guidelines issued by the Securities and Exchange Board of India (SEBI) for Employees Stock Options Plan. The plan covered all employees of the Company including employees of subsidiaries and directors and provided for the issue of 1,718,800 shares of Rs. 5 each. The Company follows intrinsic method of accounting for stock compensation cost pursuant to the Guidance Note on "Accounting for Employee Share - Based Payments" issued by the Institute of Chartered Accountants of India".

85,000 (2014: 1,290,000) options have been granted during the year and 1,136,668 (2014: 1,290,000) are outstanding as at March 31,2015. The vesting period ranges from 1 to 7 years. Weighted average of remaining contractual life is 8.35 years (2014: 9.25 years). The weighted average exercise price of all the options is Rs. 40.89 (2014: Rs. 36.70). There is no compensation cost since the exercise price is equal to the intrinsic value as at the date of grant.

The weighted average fair value of options granted during the year was Rs. 55.86 (2014: Rs. 26.56). The Black Scholes valuation model has been used for computing the weighted average fair value considering the following inputs:

The expected life of the stock is based on historical data and current expectations and is not necessarily indicative of exercise patterns that may occur. The expected volatility reflects the assumption that the historical volatility over a period similar to the life of the options is indicative of future trends, which may also not necessarily be the actual outcome.

8. The Company is in process of taking necessary steps to comply with the Transfer Pricing requirements relating to the preparation & maintenance of the Transfer Pricing documentation with respect to the specified domestic transactions entered into by the Company during financial year ended March 31, 2015. Management is of the opinion that the specified domestic transactions are at arm's length and hence the aforesaid legislation will not have any impact on the financial statements, particularly on the amount of tax expense and that of provision for taxation.

9. The Company had filed petition with the Company Law Board for compounding of offence u/s. 297 of the erstwhile Companies Act, 1956 for the transactions entered with CMS Info Systems Private Limited between July 2009 to October 2011 and as at date, the petition is pending with the Company Law Board.

For periods subsequent to October 2011, the Company had filed an application with Central Government, Ministry of Corporate Affairs, seeking its approval u/s. 297(1) of the erstwhile Companies Act, 1956 for entering into contract with CMS Info Systems Private Limited which is pending approval.

10. Depreciation on tangible fixed assets

Pursuant to the requirements of Schedule II of the Companies Act, 2013 ("the Act1), management has reassessed and changed, wherever necessary the useful lives to compute depreciation. Accordingly, the carrying amount as at April 1,2014 is being depreciated over the revised remaining useful life of the asset. The carrying value of Rs. 113.46 lakhs, in case of assets with nil revised remaining useful life as at April 1,2014, is reduced from the retained earnings as at such date. Further, had the Company continued with the previously assessed useful lives, charge for depreciation for the year would have been lower by Rs. 929.73 lakhs with consequential impact in the profits for the year.

11. Previous year comparatives

Previous year figures have been regrouped/re-arranged/reclassified, wherever necessary to conform to the current year's presentation.


Mar 31, 2013

1. Corporate Information

Gokaldas Exports Limited (''the Company'') was incorporated on March 1, 2004 by converting the erstwhile partnership firm Gokaldas India under Part IX of the Companies Act, 1956. Pursuant to the order of the Hon''ble High Court of Karnataka dated November 20, 2004, Gokaldas Exports Private Limited and The Unique Creations (Bangalore) Private Limited have been amalgamated with the Company, with April 1, 2004 being the appointed date. The Company currently operates a 100% Export Oriented Unit, a Domestic Tariff Area Unit and a Special Economic Zone Unit.

The Company is a public company domiciled in India and its shares are listed on two stock exchanges in India. The Company is engaged in the business of design, manufacture, and sale of a wide range of garments for men, women, and children and caters to the needs of several leading international fashion brands and retailers. The principal source of revenue for the Company is from export of garments and related products.

2. Basis of preparation of financial statements

The financial statements of the Company have been prepared in accordance with the generally accepted accounting principles in India (Indian GAAP) and complies in all material respects with the notified accounting standards under Companies (Accounting Standards) Rules (as amended), 2006 and the relevant provisions of the Companies Act, 1956. The financial statements have been prepared under the historical cost convention on an accrual basis except in case of assets for which provision for impairment is made and revaluation is carried out and derivative financial instruments which have been measured at fair value. The accounting policies have been consistently applied by the Company and are consistent with those used in the previous year.

3. Contingent liabilities (to the extent not provided for)

2013 2012

Claims against the Company not acknowledged as debts 278.43 240.23

Guarantees given by banks 19.81 15.10

Outstanding letters of credit 963.79 1,098.00

Bills discounted with banks 10,232.48 8,647.81

4. Gratuity

The Company has a defined benefit gratuity plan. Every employee who has completed five years or more of service gets a gratuity on retirement or termination 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 a qualifying insurance policy.

The following tables summaries the components of net benefit expense recognised in the statement of profit and loss and the funded status and amounts recognised in the balance sheet:

5. Leasing Arrangements:

The Company''s leasing arrangements in respect of its office, factory and residential premises are in the nature of operating leases. These leasing arrangements, which are usually cancellable at the option of the lessee, are for a total period ranging from eleven months to six years and are renewable with mutual consent. All leases include a clause to enable upward revision of the rental charge on a periodic basis as specified under the rental agreement. The charge on account of lease rentals for the year is Rs. 675.67 lakhs (2012: Rs.843.52 lakhs).

Future obligations of lease rentals for non-cancellable period under respective lease agreements aggregate to Rs. 166.81 lakhs (2012: Rs. 194.01 lakhs)

6. The Company is in process of taking necessary steps to comply with the Transfer Pricing requirements relating to the preparation & maintenance of the Transfer Pricing documentation with respect to the specified domestic transactions entered into by the Company during financial year ended March 31, 2013. The Management is of the opinion that the specified domestic transactions are at arm''s length and hence the aforesaid legislation will not have any impact on the financial statements, particularly on the amount of tax expense and that of provision for taxation.

7. The Company has filed petition with the Company Law Board for compounding of offence u/s. 297 of the Companies Act, 1956 for the transactions entered with CMS Info Systems Private Limited between July 2009 to October 2011 and as at date, the petition is pending with the Company Law Board.

For periods subsequent to October 2011, the Company has filed an application with Central Government, Ministry of Corporate Affairs, seeking its approval u/s. 297(1) of the Companies Act, 1956 for entering into contract with CMS Info Systems Private Limited which is pending approval.

8. Previous year comparatives

Previous year figures have been regrouped/re-arranged/reclassified, wherever necessary to conform to the current year''s presentation.


Mar 31, 2012

1. Corporate Information

Gokaldas Exports Limited ('the Company') was incorporated on March 1, 2004 by converting the erstwhile partnership firm Gokaldas India under Part IX of the Companies Act, 1956. Pursuant to the order of the Hon'ble High Court of Karnataka dated November 20, 2004, Gokaldas Exports Private Limited and The Unique Creations (Bangalore) Private Limited have been amalgamated with the Company, with April 1, 2004 being the appointed date. The Company currently operates a 100% Export Oriented Unit, a Domestic Tariff Area Unit and a Special Economic Zone Unit.

The Company is a public company domiciled in India and its shares are listed on two stock exchanges in India. The Company is engaged in the business of design, manufacture, and sale of a wide range of garments for men, women, and children and caters to the needs of several leading international fashion brands and retailers. The principal source of revenue for the Company is from export of garments and related products.

2. Basis of preparation of financial statements

The financial statements of the Company have been prepared in accordance with the generally accepted accounting principles in India (Indian GAAP) and complies in all material respects with the notified accounting standards under Companies (Accounting Standards) Rules (as amended), 2006 and the relevant provisions of the Companies Act, 1956. The financial statements have been prepared under the historical cost convention on an accrual basis except in case of assets for which provision for impairment is made and revaluation is carried out. The accounting policies have been consistently applied by the Company and are consistent with those used in the previous year.

During the year ended March 31, 2012, the revised Schedule VI notified under the Companies Act, 1956 has become applicable to the Company, for the preparation and presentation of financial statements. The adoption of revised Schedule VI does not impact the recognition and measurement principles followed for the preparation of the financial statements. However, it has significant impact on the presentation and disclosure of the financial statements. The Company has reclassified previous year figures in accordance with the requirements applicable in current year.

(a) Terms/ rights attached to equity shares

The Company has only one class of equity shares having a par value of Rs. 5 per share. Each holder of equity is entitled to one vote per share. The Company declares and pays dividend in Indian rupees. The dividend proposed by the Board of Directors is subject to the approval of the shareholders in ensuing Annual General Meeting.

In event of liquidation of the Company, the holders of equity shares would be entitled to receive remaining assets of the Company, after distribution of all preferential amounts. The distribution will be in proportion to the number of equity shares held by the shareholders.

As per records of the Company, including its register of shareholders/ members and other declarations received from shareholders regarding beneficial interest, the above shareholding represents both legal and beneficial ownership of shares.

Note :

(a) Term Loan from banks was taken under Technology Upgradation Fund (TUF) scheme and carries interest @ 14.25% (March 2011 : 11.25%). The loan is repayable in 52 monthly installments of Rs. 72 lakhs each commencing from September 2009. The loan is secured by hypothecation of plant and machinery acquired out of this TUF loan.

(b) Current maturities are disclosed under the head current liabilities [Refer Note 8]

3. Contingent liabilities (to the extent not provided for)

2012 2011

Claims against the Company not acknowledged as debts 240.23 239.02

Guarantees given by banks 15.10 305.60

Outstanding letters of credit 1,098.00 1,049.44

Bills discounted with banks 8,647.81 14,153.84

4. Gratuity

The Company has a defined benefit gratuity plan. Every employee who has completed five years or more of service gets a gratuity on retirement or termination 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 a qualifying insurance policy.

The following tables summaries the components of net benefit expense recognised in the statement of profit and loss and the funded status and amounts recognised in the balance sheet:

Notes:

1. The estimate of future salary increases considered in actuarial valuation takes into account inflation, seniority, promotion and other relevant factors such as supply & demand in the employment market.

2. The estimated rate of return on plan assets is determined based on the market prices prevailing on that date, applicable to the period over which the obligation is to be settled,

3. The Company expects to contribute Rs.85 lakhs (Rs. 248.72 lakhs in 2011-12) to gratuity in 2012-13.

5. Segment information

a) Primary business segment

The Company is engaged in a single business segment of sale of garment, and hence, no additional disclosures are required, other than those already given in the financial statements.

6. Leasing Arrangements:

The Company's leasing arrangements in respect of its office, factory and residential premises are in the nature of operating leases. These leasing arrangements, which are usually cancellable at the option of the lessee, are for a total period ranging from eleven months to six years and are renewable with mutual consent. All leases include a clause to enable upward revision of the rental charge on a periodic basis as specified under the rental agreement. The charge on account of lease rentals for the year is Rs. 843.52 lakhs (2011: Rs.899.17 lakhs).

Future obligations of lease rentals for non cancellable period under respective lease agreements aggregate to Rs. 194.01 lakhs (2011 : Rs. 341.75 lakhs)

7. In previous year, there was a fire in the raw material warehouse of the Company in Bangalore and materials valued at Rs. 3,766.49 lakhs were fully destroyed. The Insurance claim was settled at Rs. 3,235.33 lakhs and the difference Rs. 531.16 lakhs was shown as extraordinary item.

8. Previous year comparatives

Previous year figures have been regrouped/re-arranged/reclassified, wherever necessary to conform to the current year's presentation.


Mar 31, 2011

(All amounts in Rs. Lakhs except otherwise stated)

A. Background

Gokaldas Exports Limited ('the Company') was incorporated on March 1, 2004 by converting the erstwhile partnership firm Gokaldas India under Part IX of the Companies Act, 1956. Pursuant to the order of the Hon'ble High Court of Karnataka dated November 20, 2004, Gokaldas Exports Private Limited and The Unique Creations (Bangalore) Private Limited have been amalgamated with the Company, with April 1, 2004 being the appointed date. The Company currently operates a 100% Export Oriented Unit, a Domestic Tariff Area Unit and a Special Economic Zone Unit.

The Company is engaged in the business of design, manufacture and sale of a wide range of garments for men, women and children and caters to the needs of several leading international fashion brands and retailers. The principal source of revenue for the Company is from export of garments and related products.

1. Contingent liabilities Amount in Rs Lakhs

2011 2010

Claims against the Company not acknowledged as debts 239.02 349.60

Guarantees given by banks 305.60 315.10

Outstanding letters of credit 1,049.44 364.37

Export Bills discounted with banks 14,153.84 13,849.46

Estimated amount of contracts remaining to be executed on capital accounts and not provided for (net of advances) 320.71 470.66

2. Export Promotion Capital Goods Scheme

The Company has imported capital goods without payment of duty under Export Promotion Capital Goods ('EPCG') Scheme upto March 31, 2010. Under the EPCG scheme, the Company has export obligations of Rs. 1,483.59 lakhs (2010 : Rs. 840.41 lakhs) to be fulfilled before November 05, 2017.

3. Gratuity

The Company has a defined benefit gratuity plan. Every employee who has completed five years or more of service gets a gratuity on retirement or termination 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 a qualifying insurance policy.

The following tables summarise the components of net benefit expense recognised in the profit and loss account and the funded status and amounts recognised in the balance sheet:

4. Segment information

a) Primary business segment

The Company is engaged in a single business segment of sale of garment, and hence, no additional disclosures are required, other than those already given in the financial statements.

b) Secondary business segment (by geographical area based on location of customers):

Notes:

1. All fixed assets are located in India.

2. Figures in brackets relate to previous year.

5. Related party disclosures

A. Names of related parties and description of relationship:

Description of Relationship Names of related parties

a. Parties where control exists:

Immediate Holding Company Blackstone FP Capital Partners (Mauritius) V-B Subsidiary Limited

Ultimate Holding Company Blackstone FP Capital Partners (Mauritius) V-B Limited

Wholly Owned Subsidiaries All Colour Garments Private Limited

Deejay Trading Private Limited

Glamourwear Apparels Private Limited

Madhin Trading Private Limited

Magenta Trading Private Limited

Rafter Trading Private Limited

Rajdin Apparels Private Limited

Reflexion Trading Private Limited

Rishikesh Apparels Private Limited

Robot Systems Private Limited

Seven Hills Clothing Private Limited

SNS Clothing Private Limited

Vignesh Apparels Private Limited

b. Key management personnel:

Chairman Mr. Madanlal J Hinduja (upto January 15, 2011)

Managing Director Mr. Rajendra J Hinduja (upto March 31, 2011)

Executive Director Mr. Dinesh J Hinduja (upto March 31, 2011)

Chief Operating Officer - Production Mr. Ashwin R Hinduja

Chief Operating Officer - Marketing Mr. Vivek M Hinduja (upto September 30, 2010)

Chief Operating Mr. Gaurav D Hinduja (upto Officer - Marketing May 31, 2010)

c. Enterprises over which key management personnel and their relatives exercise significant influence with whom transactions have taken place during the year

Partnership Firm Hinduja Trading Company

DMR Enterprises Universal Garments

Private Limited Companies VAG Exports Private Limited

5. Leasing Arrangements:

The Company's leasing arrangements in respect of its office, factory and residential premises are in the nature of operating leases. These leasing arrangements, which are usually cancellable at the option of the lessee, are for a total period ranging from eleven months to six years and are renewable with mutual consent. The charge on account of lease rentals for the year is Rs. 899.17 lakhs (2010 : Rs. 675.57 lakhs).

6. On April 16, 2010, there was a fire in one of the raw material warehouses of the Company in Bangalore and materials valued at Rs. 3,766.49 lakhs were fully destroyed. The Insurance claim has been settled during the year and the Company has received Rs. 3,235.33 lakhs in full settlement of the claim. The difference between the amount claimed and settled, being Rs. 531.16 lakhs has been charged off as extraordinary item in the profit and loss account in the current year.

7. Previous year's figures have been regrouped / rearranged / reclassified, wherever necessary to conform to the current year's presentation.


Mar 31, 2010

A. Background

Gokaldas Exports Limited (the Company) was incorporated on March 1, 2004 by converting the erstwhile partnership firm Gokaldas India under Part IX of the Companies Act, 1956. Pursuant to the order of the Honble High Court of Karnataka dated November 20, 2004, Gokaldas Exports Private Limited and The Unique Creations (Bangalore) Private Limited have been amalgamated with the Company, with April 1, 2004 being the appointed date. The Company currently operates a 100% Export Oriented Unit, a Domestic Tariff Area Unit and a Special Economic Zone Unit.

The Company is engaged in the business of design, manufacture and sale of a wide range of garments for men, women and children and caters to the needs of several leading international fashion brands and retailers. The principal source of revenue for the Company is from export of garments and related products.

1. Contingent liabilities Amount in Rs. Lakhs

Particulars 2010 2009

Claims against the Company not acknowledged as debts 349.60 67.60

Guarantees given by banks 315.10 23.55

Outstanding letters of credit 364.37 1,221.90

Export Bills discounted with banks 13,849.46 17,220.14

Estimated amount of contracts remaining to be executed on

capital accounts and not provided for (net of advances) 470.66 90.40

Note: Certain industrial/ labour disputes are pending before various judicial authorities for which amounts are not ascertainable.

2. Export Promotion Capital Goods Scheme

The Company has imported capital goods without payment of duty under the Export Promotion Capital Goods Scheme. Under the scheme, the Company has export obligations of Rs. 840.41 lakhs (2009: Rs. 1205.59 lakhs ) to be fulfilled before November 05, 2017.

3. Gratuity

The Company has a defined benefit gratuity plan. Every employee who has completed five years or more of service gets a gratuity on retirement or termination 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 a qualifying insurance policy.

The following tables summarise the components of net benefit expense recognised in the profit and loss account and the funded status and amounts recognised in the balance sheet:

Notes:

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

2. The Company expects to contribute Rs. 190 Lakhs to gratuity in 2010-11.

4. Segment information

a) Primary business segment

The Company is engaged in a single business segment of sale of garment, and hence, no additional disclosures are required, other than those already given in the financial statements.

b) Secondary business segment (by geographical area based on location of customers):

Notes:

1. All fixed assets are located in India.

2. Figures in brackets relate to previous year.

6. Leasing Arrangements:

The Companys leasing arrangements in respect of its office, factory and residential premises are in the nature of operating leases. These leasing arrangements, which are usually cancellable at the option of the lessee, are for a total period ranging from eleven months to six years and are renewable with mutual consent.

Note: The above figures do not include provisions for encashable leave and gratuity as actuarial valuation is done for Company as a whole.

Note: Installed capacity cannot be quantified on account of a large variety of products that can be manufactured with varying specifications.

Notes:

i. The above consumption figures are shown after adjusting excesses and shortages ascertained on physical count, unserviceable items, etc.

ii. Quantitative information for accessories/ others is not provided as this comprises numerous items.

5. Post balance sheet event

On April 16, 2010, there was a fire in the raw material warehouse of the Company in Bangalore and materials valued at Rs. 3766.49 lakhs were fully destroyed. The Company has filed claim with the insurance company and management does not foresee any loss arising out of such event.

6. Previous years figures have been regrouped/rearranged/reclassified, wherever necessary to conform to the current years presentation.

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