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Notes to Accounts of Kothari Petrochemicals Ltd.

Mar 31, 2023

Fair value of Investment Property

The fair value of the Company''s total investment property as at 31st March 2023 is ''2,805.89 lakhs (''2,665.87 lakhs as at 31st March 2022). The valuation has been carried out by Mr.Khatib Ahmed, Chartered Engineer.The valuer is not registered under companies (Registered Valuers and valuation) Rules, 2017.

(e) Details of shares reserved for issue under options and contracts or commitments for the sale of shares or disinvestment, including the terms and amounts: Nil

(f) Equity Shares movement during 5 years immediately preceding the financial year ended 31st March 2023:

(i) Aggregate number of equity shares allotted as fully paid up pursuant to contract without payment being received in cash : Nil

(ii) Aggregate number of equity shares allotted as fully paid up by way of Bonus Shares: Nil

(iii) Aggregate number of equity shares bought back: Nil

(g) Details of Terms of any securities convertible into equity / preference shares issued along with the earliest date of conversion in descending order starting from the farthest such date: Nil

(h) Calls unpaid (showing aggregate value of calls unpaid by directors and officers): Nil

(i) Forfeited shares (amount originally paid-up): Partly paid shares forfeited for '' 34.04 lakhs.

1. Sanctioned amount ''250.00 lakhs disbursed during July 2020 for Covid emergency loan. 80% secured by stocks and book debts and 20% clean. Balance outstanding as on 31st March 2023 was ''16.99 Lakhs. Rate of interest linked to one year MCLR of Bank, with annual reset interest ranging between 7.50% to 7.55%. Principal repayable in 30 equal monthly instalments starting from February 2021.

2. Sanctioned ''2,707.00 lakhs during February 2022 as Capacity Enhancement Project Term Loan. Rate of interest rate is ranging at 7% to 9.50% with repo linked. Availed during the year ''1,415.69 Lakhs and balance outstanding as on 31st March 2023 was ''2,224.61 lakhs. The term loan is secured with exclusive charge on project assets created out of this loan. Monthly installment repayment of ''56.40 lakhs starting from January 2023.

(a) Liability to existing employees of the Company in respect of gratuity is covered under insurance policy (maintained with Reliance Nippon Life Insurance Company Limited) administered by a Trust maintained by Kothari Petrochemicals Limited (KPL).The actuarial valuation is done by an independent external valuer under the Projected Unit Credit Method to ascertain the liability enterprise wise. During the year2021-22, KPLhas created separate trust for KPLemployees and equitable interesttransferbasedonactuary valuation were carried out.Thefollowingtablesummarisesthecomponentsof defined benefit plan cost to be recognised in statement of profit and loss account, other comprehensive income, liability to be recognized in balance sheet and changes in fair value of planned assets.

(a) Contribution to Provident Fund is in the nature of defined contribution plan and are made to Employees Provident Fund Scheme, 1952. Under the Scheme the Company is required to contribute a specified percentage of payroll cost to the Scheme. The interest as declared by the Government from time to time accrues to the employees under the Scheme.

(b) Contribution to Superannuation Fund is in the nature of defined contribution plan and is remitted to Reliance Nippon Life Insurance Company Limited. Under the Scheme the Company is required to contribute a specified percentage of payroll cost to underwriters to enable them to make settlement to the qualifying employees.

(c) Contribution to Employees'' Group Gratuity-cum Life Assurance scheme is in the nature of Defined Benefit plan and is remitted to Reliance Nippon Life Insurance Company Ltd. The Scheme provides for lump sum payment to vested employees at retirement, death while in employment or on termination of employment.

(d) Liability for unavailed leave for employees is considered as short term benefit and provided accordingly in books.

Note - 32: Capital Management

The Company''s capital management is intended to maximise the return to shareholders of the Company through the optimization of debt and equity balance.

The Company determines the amount of capital required on the basis of annual and long-term operating plans. The funding requirements are met through equity and long term/short term borrowings. The Company monitors the capital structure on the basis of Net debt to equity ratio and maturity profile of the overall debt portfolio of the Company.

Note - 35: Nature and extent of risks arising from financial instruments and respective financial risk management objectives and policies

The Company has adequate internal processes to assess, monitor and manage financial risks. These risks include market risk (including currency risk, interest risk and equity price risk), credit risk, liquidity risk and cyber security risk.

The Company seeks to minimise the effect of these risks by using financial instruments such as foreign currency forward contracts and appropriate risk management policies. The Company does not enter into trade financial instruments, including derivative financial instruments for speculative purposes.

a) Foreign currency risk management

The Company is exposed to foreign exchange risk on account of exports. The Company has a forex policy in place whose objective is to reduce foreign exchange risk by deploying the appropriate hedging strategies (forward covers) and also by maintaining reasonable open exposures within the approved parameters depending on the future outlook on currencies.

The forward contracts have been entered into to hedge highly probable sale transactions and trade receivables. Forward cover has been taken for all the export trade receivables as at the above dates. Exposures to other currency is negligible and hence not considered above.

b) Interest rate risk management

The Company uses cash credit for working capital and term loan for capex. The interest rates on these borrowings are exposed to change in respective benchmark rates. The Company manages the interest rate risk by maintaining appropriate mix/portfolio of borrowings.

Interest rate sensitivity analysis

The sensitivity analysis below has been determined for borrowings assuming the amount of borrowings outstanding at the end of reporting was outstanding for the whole year. A 50 basis point increase or decrease in case of Rupee borrowing is used when reporting interest rate risk internally to key management personnel and represents management''s assessment of the reasonably possible change in interest rate.

If the interest rate were to increase by 50 basis from 31st March 2023, in case of Rupee borrowings and all other variables were held constant,Impact of ''11.21 lakhs as additional annual interest expense on floating rate borrowing would arise as on 31st March 2023. (31st March 2022 ''5.49 lakhs).

c) Equity price risks

The Company''s listed equity securities are susceptible to market price risk arising from uncertainties about future values of the investment securities. The Company manages the equity price risk through diversification, by placing limits on equity instruments and party routing through portfolio management services. Reports on the equity portfolio are submitted to the Company''s senior management on a regular basis. The Company''s Board of Directors reviews and approves all equity investment decisions.

Increase or decrease in equity prices by 5% would the expose the listed equity securities at fair value of ''268 lakhs by ''13.41 lakhs as at 31st March 2023 (''10.21 lakhs - as on 31st March 2022).

d) Credit risk management

Credit risk refers to the risk that acounter party will default on its contractual obligations resulting in financial loss to the Company. The Company is exposed to credit risk from its operating activities (primarily trade receivables) and from its financing activities, including deposits with banks and financial institutions.

Customer credit risk is managed by each business unit subject to the Company''s established policy, procedures and controls relating to the customer credit risk management. The Company uses financial information and past experience to evaluate credit quality of majority of its customers and individual credit limits are defined in accordance with this assessment. Outstanding receivables and credit worthiness of its counter parties are periodically monitored and taken up on a case to case basis. The Company evaluates the concentration of risk with respect to trade receivables as low, as the major chunk of trade receivables is from oil PSUs with high credit rating. There is no material expected credit loss based on the past experience. The Company assesses the impairment of trade receivables on a case to case basis and creates loss allowances, if required.

e) Liquidity risk management

The Company manages liquidity risk by maintaining adequate reserves, banking facilities and reserve borrowing facilities, by continuously monitoring forecast and actual cash flows, and by matching the maturity profiles of financial assets and liabilities.

f) Cyber security Risk

This risks refers to the potential loss due to a breach or failure of an organizations''s information systems or technology infrastructure. It may results in financial losses, legal liabilities and damage to an organization''s reputation which can affect financial stability and performance.

It can manifest in various forms, such as hacking, phishing, malware, ransomware, and denial-of-service attacks. These threats can lead to theft of sensitive information, disruption of operations, or destruction of data, all of which can result in financial losses for the organization.

The company has put in place effective management of cyber security risk by adopting a comprehensive approach that includes implementing of security controls, conducting regular vulnerability assessments, training employees on cyber security best practices. By managing cyber security risk effectively, organizations can protect their financial assets and ensure their ongoing financial stability and success.

Note 36: Events after the reporting period

No adjusting or significant non-adjusting events have occurred between 31st March 2023, the reporting date and the date of approval of financial statements.The Board of Directors recommended a Final dividend of '' 0.75 per equity share in the meeting held on 26th May 2023.

note - 37: Contingent Liabilities and Commitments

('' in Lakhs)

As at

As at

particulars

31st March 2023

31st march 2022

(i) Contingent liabilities

(a) Claims against the Company not acknowledged as debt:

-

-

(b) Guarantees excluding financial guarantees:

1,692.37

1,161.50

(c) Other money for which company is contingently liable(LC)

-

-

(ii) Commitments

(a) Estimated amount of contracts remaining to be executed on capital

account and not provided for

999.95

1,023.54

(b) Uncalled liability on shares and other investments partly paid; and

-

-

(c) other commitments (specify nature).

-

-

Note - 39: Segment Reporting (Ind AS 108)

The Company is engaged in the business of Manufacture and sale of Petrochemical Products which constitutes single business segment. As per management''s perspective, the risks and returns from its sales do not materially vary geographically. Accordingly, there are no other business / geographical segments to be reported under Ind AS 108.

(ii) Disclosure on borrowings secured against current assets:

The company has working capital facilities from Indian bank. Quarterly returns or statements filed by the company against current assets with the bank and are in agreement with the books of accounts.

(iii) Registration of charges or satisfaction with Registrar of Companies (ROC):

The company has no charges or satisfaction yet to be registered with ROC beyond the statutory period.

Note - 41: Exceptional items

Last year, the company scrapped old equipment which have no further use, the carrying amount in books was derecognised and shown under exceptional loss. During the year, the company has realized proceeds from the disposals of the old equipments which was scrapped during March 2022. The resultant gain is shown under exceptional item.

Note - 42: Previous year figures

Previous year figures have been regrouped wherever necessary to correspond with current year''s classification/ disclosure.


Mar 31, 2021

Rights, preferences and restrictions

Equity shares - The Company has issued only one class of equity share having a par value of '' 10 per share.

Each holder of equity share is entitled to one vote per share. All equity share have equal rights to receive or participate in any dividend or other distribution in respect of such shares.

Bonus shares/Buy back/Shares for consideration other than cash issued during the period of five years immediately preceding the financial year ended 31st March 2021:

(i) Aggregate number of equity shares allotted as fully paid up pursuant to contract without payment being received in cash: Nil

(ii) Aggregate number of equity shares allotted as fully paid up by way of Bonus Shares: Nil

(iii) Aggregate number of equity shares bought back: Nil

* Term loan from Indian Bank, sanctioned amount '' 250.00 lakhs disbursed during July 20. 80% secured by stocks and book debts and 20% clean. Rate of interest linked to one year MCLR of Bank, with annual reset interest ranging at 7.50%. Principal repayable in 30 equal monthly instalments starting February 2021.

HDFC Term Loan and Car loan fully repaid during Sep 20.

** The facilities are secured by first charge on hypothecation of stocks and book debts.

(a) Liability to existing employees of the Company in respect of gratuity is covered under a common insurance policy (maintained with Reliance Nippon Life Insurance Company Limited) administered by a Trust maintained for participating enterprises viz. Kothari Sugars & Chemicals Limited (KSCL) and Kothari Petrochemicals Limited (KPL). The actuarial valuation is done by an independent external valuer under the Projected Unit Credit Method to ascertain the liability enterprise wise. The following table summarises the components of defined benefit plan cost to be recognised in statement of profit and loss account, other comprehensive income, liability to be recognised

(b) Contribution to Superannuation Fund is in the nature of defined contribution plan and is remitted to Reliance Nippon Life Insurance Company Limited. Under the Scheme the Company is required to contribute a specified percentage of payroll cost to underwriters to enable them to make settlement to the qualifying employees.

(c) Contribution Employees'' Group Gratuity-cum Life Assurance scheme is in the nature of Defined Benefit plan and is remitted to Reliance Nippon Life Insurance Company Limited. The Scheme provides for lump sum payment to vested employees at retirement, death while in employment or on termination of employment.

Note - 32: Capital Management

The Company''s capital management is intended to maximise the return to shareholders of the Company through the optimization of debt and equity balance.

The Company determines the amount of capital required on the basis of annual and long-term operating plans. The funding requirements are met through equity and long term/short term borrowings. The Company monitors the capital structure on the basis of Net debt to equity ratio and maturity profile of the overall debt portfolio of the Company.

Fair value of investments in Mutual Funds is based on Net asset value (NAV) declared by mutual fund houses at the reporting date.

There are no reclassification between different levels during the year.

Note - 35: Nature and extent of risks arising from financial instruments and respective financial risk management objectives and policies

The Company has adequate internal processes to assess, monitor and manage financial risks. These risks include market risk (including currency risk, interest risk and other price risk), credit risk and liquidity risk.

The Company seeks to minimise the effect of these risks by using financial instruments such as foreign currency forward contracts and appropriate risk management policies. The Company does not enter into trade financial instruments, including derivative financial instruments for speculative purposes.

a) Foreign currency risk management

The Company is exposed to foreign exchange risk on account of exports. The Company has a forex policy in place whose objective is to reduce foreign exchange risk by deploying the appropriate hedging strategies (forward covers) and also by maintaining reasonable open exposures within the approved parameters depending on the future outlook on currencies.

b) Interest rate risk management

The Company uses cash credit for working capital and term loan for capex. The interest rates on these borrowings are exposed to change in respective benchmark rates. The Company manages the interest rate risk by maintaining appropriate mix/portfolio of borrowings.

Interest rate sensitivity analysis

The sensitivity analysis below has been determined for borrowings assuming the amount of borrowings outstanding at the end of reporting was outstanding for the whole year. A 50 basis point increase or decrease in case of Rupee borrowing is used when reporting interest rate risk internally to key management personnel and represents management''s assessment of the reasonably possible change in interest rate.

If the interest rate were to increase by 50 basis from 31st March 2021, in case of Rupee borrowings and all other variables were held constant, no additional annual interest expense on floating rate borrowing would arise as there is no loan outstanding as on 31st March 2021. (31st March 2020''12 lakhs).

c) Other price risks

The Company does not have any investments in equity shares and hence is not exposed to any equity price risks.

d) Credit risk management

Credit risk refers to the risk that a counter party will default on its contractual obligations resulting in financial loss to the Company. The Company is exposed to credit risk from its operating activities (primarily trade receivables) and from its financing activities, including deposits with banks and financial institutions.

Customer credit risk is managed by each business unit subject to the Company''s established policy, procedures and controls relating to the customer credit risk management. The Company uses financial information and past experience to evaluate credit quality of majority of its customers and individual credit limits are defined in accordance with this assessment. Outstanding receivables and credit worthiness of its counter parties are periodically monitored and taken up on a case to case basis. The Company evaluates the concentration of risk with respect to trade receivables as low, as the major chunk of trade receivables is from oil PSUs with high credit rating. There is no material expected credit loss based on the past experience. The Company assesses the impairment of trade receivables on a case to case basis and creates loss allowances, if required.

e) Liquidity risk management

The Company manages liquidity risk by maintaining adequate reserves, banking facilities and reserve borrowing facilities, by continuously monitoring forecast and actual cash flows, and by matching the maturity profiles of financial assets and liabilities.

Note - 39: Segment Reporting (Ind AS 108)

The Company is engaged in the business of Manufacture and sale of Petrochemical Products which constitues single business segment. As per management''s perspective, the risks and returns from its sales do not materially vary geographically. Accordingly, there are no other business / geographical segments to be reported under Ind AS 108.

Note - 40: Previous year figures

Previous year figures have been regrouped/reclassified wherever necessary to correspond with current year''s classification/disclosure.


Mar 31, 2018

Note - 1 CORPORATE OVERVIEW

Kothari Petrochemicals Limited (referred to as “KPL” or the “Company”) are the Manufacturers of Poly Iso Butylene. The registered office of the Company is situated at “Kothari Buildings”, No.115, Mahatma Gandhi Salai, Nungambakkam, Chennai - 600 034.

The functional and presentation currency of the Company is Indian Rupee, which is currency of the primary economic environment in which the Company operates.

The financial statements for the year ended 31 March, 2018 were approved for issue by the Board of Directors of the Company on 25 May, 2018 and are subject to adoption by the shareholders in the ensuing Annual General Meeting.

Notes :

(a) Experience adjustment has been provided only to the extent of details available.

(b) Estimates of future salary increase take into account of inflation, seniority, promotion and other relevant factors.

(c) The discount rate is based on the prevailing market yields of Government of India Bonds as at the Balance Sheet date for the estimated term of the obligation.

(d) The Company’s gratuity funds are managed by the M/s. Reliance Nippon Life Insurance Company Limited and therefore the composition of the fund assets is not presently ascertained.

(e) The Company’s best estimate of the contribution expected to be paid to the plan during the next year is Rs.19.13 lakh (as on 31 March, 2017 Rs.29.51 lacs).

Sensitivity Analysis

Significant actuarial assumptions for the determination of the defined benefit obligation are discount rate, expected salary increase and attrition rate. The sensitivity analysis below has been determined based on reasonable possible changes of the assumptions occurring at the end of the reporting period., while holding all other assumptions constant. The results of sensitivity analysis are given below:

*Trade payables are non interest bearing and are normally settled between 0 and 90 days.

*The Company has requested its suppliers to confirm the status as to whether they are covered under the Micro, Small and Medium Enterprises Development Act 2006. In the absence of confirmation from the suppliers, disclosures, if any, relating to unpaid amounts as at the year end together with interest paid/payable as required under the Act has not been given.

(a) Contribution to Provident Fund is in the nature of defined contribution plan and are made to Employees Provident Fund Scheme, 1952. Under the Scheme the Company is required to contribute a specified percentage of payroll cost to the Scheme. The interest as declared by the Government from time to time accrues to the employees under the Scheme.

(b) Contribution to Superannuation Fund is in the nature of defined contribution plan and is remitted to Reliance Nippon Life Insurance Company Limited. Under the Scheme the Company is required to contribute a specified percentage of payroll cost to underwriters to enable them to make settlement to the qualifying employees.

(c) Contribution Employees’ Group Gratuity-cum Life Assurance scheme is in the nature of Defined Benefit plan and is remitted to Reliance Nippon Life Insurance Company Limited. The Scheme provides for lump sum payment to vested employees at retirement, death while in employment or on termination of employment.

(d) Liability for unavailed leave for employees is considered as short term benefit and provided accordingly in books.

Note - 2 Capital Management

The Company’s capital management is intended to maximise the return to shareholders of the Company through the optimization of debt and equity balance.

The Company determines the amount of capital required on the basis of annual and long-term operating plans. The funding requirements are met through equity and long term/short term borrowings. The Company monitors the capital structure on the basis of Net debt to equity ratio and maturity profile of the overall debt portfolio of the Company.

Note - 3 Fair value of financial assets and liabilities

The Company considers that the carrying amount of financial assets and financial liabilities recognised at amortised cost in the balance sheet approximates their fair value. Fair value hierarchy of these financial assets and liabilities are categorized as Level 3.

Level 1 - Quoted price in an active market.

Level 2 - Discounted cash low. Future cash lows are estimated based on forward exchange rates and contract rates, discounted at a rate that refects the credit risk of various counterparties.

Level 3 - Discounted cash low method is used to capture the present value of the expected future economic benefit that will low to the company.

Note - 4 Nature and extent of risks arising from financial instruments and respective financial risk management objectives and policies

The Company has adequate internal processes to assess, monitor and manage financial risks. These risks include market risk (including currency risk, interest risk and other price risk), credit risk and liquidity risk.

The Company seeks to minimise the effect of these risks by using financial instruments such as foreign currency forward contracts and appropriate risk management policies. The Company does not enter into trade financial instruments, including derivative financial instruments for speculative purposes.

a) Foreign currency risk management

The Company is exposed to foreign exchange risk on account of exports. The Company has a forex policy in place whose objective is to reduce foreign exchange risk by deploying the appropriate hedging strategies (forward covers) and also by maintaining reasonable open exposures within the approved parameters depending on the future outlook on currencies.

The forward contracts have been entered into to hedge highly probable sale transactions and trade receivables. Forward cover has been taken for all the export trade receivables as at the above dates.

b) Interest rate risk management

The Company uses cash credit for working capital and term loan for capex. The interest rates on these borrowings are exposed to change in respective benchmark rates. The Company manages the interest rate risk by maintaining appropriate mix/portfolio of borrowings.

Interest rate sensitivity analysis

The sensitivity analysis below has been determined for borrowings assuming the amount of borrowings outstanding at the end of reporting was outstanding for the whole year. A 50 basis point increase or decrease in case of Rupee borrowing is used when reporting interest rate risk internally to key management personnel and represents management’s assessment of the reasonably possible change in interest rate.

If the interest rate were to increase by 50 basis from March 31,2018, in case of Rupee borrowings and all other variables were held constant, additional annual interest expense on floating rate borrowing would amount to approximately Rs.16 lacs (31 March 2017 Rs.12 lacs).

c) Other price risks

The Company does not have any investments in equity shares and hence is not exposed to any equity price risks.

d) Credit risk management

Credit risk refers to the risk that a counter party will default on its contractual obligations resulting in financial loss to the Company. The Company is exposed to credit risk from its operating activities (primarily trade receivables) and from its financing activities, including deposits with banks and financial institutions.

Customer credit risk is managed by each business unit subject to the Company’s established policy, procedures and controls relating to the customer credit risk management. The Company uses financial information and past experience to evaluate credit quality of majority of its customers and individual credit limits are defined in accordance with this assessment. Outstanding receivables and credit worthiness of its counter parties are periodically monitored and taken up on a case to case basis. The Company evaluates the concentration of risk with respect to trade receivables as low, as the major chunk of trade receivables is from oil PSUs with high credit rating. There is no material expected credit loss based on the past experience. The Company assesses the impairment of trade receivables on a case to case basis and creates loss allowances if required.

e) Liquidity risk management

The Company manages liquidity risk by maintaining adequate reserves, banking facilities and reserve borrowing facilities, by continuously monitoring forecast and actual cash flows, and by matching the maturity profiles of financial assets and liabilities.

The table below summarises the maturity profile of the Company’s financial liabilities based on contractual undiscounted payments as at 31st March 2018.

Note - 5 Events after the reporting period

No adjusting or significant non-adjusting events have occurred between 31st March 2018, the reporting date and the date of authorisation except non-adjusting event of proposal of dividend of Re.0.75 per share on face value of Rs.10 each on the paid up Equity Share Capital of the Company subject to the approval of shareholders at the ensuing Annual General Meeting.

Note – 6A Notes to reconciliation

Footnotes to the reconciliation

a) Investment property

Under the previous GAAP, investment properties were presented as part of Property, Plant and Equipment. However under the Ind AS, Investment properties are required to be presented separately on the face of the balance sheet. There is no impact on the total equity or profit as a result of this presentation.

b) Deferred Taxes

Under the previous GAAP, deferred taxes were to be accounted on timing differences arising between the accounting profit and tax profit. However, such method has been replaced with balance sheet approach in Ind AS, wherein deferred taxes are to be accounted for the differences arising between accounting balance sheet and tax balance sheet. Accordingly deferred taxes has been accounted for such temporary differences.

c) Borrowings

Under the previous GAAP, transaction cost incurred in connection with borrowings were amortised upfront and charged to statement of profit and loss for the period. Under Ind AS, transaction costs are included in the initial recognition amount of financial liability and charged to the statement of profit and loss using the effective interest method.

d) Derivatives

Under the previous GAAP the fair value of forward contracts were not recognised in the books of accounts. However these are fair valued under Ind AS and the gains or losses arising due to fair valuation are recognised in the retained earnings on the date of transition and subsequently in the statement of profit and loss. The impact of MTM valuation on total equity as at March 31, 2017 is a reduction of Rs.4.66 lakhs. The net impact of profit before tax is a reduction of Rs.2.96 lakhs.

e) Actuarial gains and losses

Under the previous GAAP, actuarial gains and losses were recognised in profit or loss statement. Under Ind AS, the actuarial gains and losses form part of remeasurement of the net defined benefit liability / asset and are 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 gain for the year ended March 31, 2017 were Rs. 0.18 lakhs and the tax effect thereon Rs. 0.06 lakhs. This change does not affect total equity,but there reduction in profit before tax by Rs. 0.18 lakhs.

f) Other comprehensive income

Under the previous GAAP, there was no concept of other comprehensive income. Under Ind AS, specified items of income, expense, gains or losses are required to be presented in other comprehensive income.

g) Interest-free rental advances / deposits

Under the previous GAAP, interest-free rental advances paid and deposits received were not required to be fair valued. Under Ind As, interest-free rental deposit received in respect of the investment property and interest-free rental advance paid for properties taken on lease are required to be fair valued.

Note - 7 Consolidation of Foreign Subsidiaries

The Company’s foreign subsidiaries, Kothari Petrochemicals Pte Ltd, Singapore and Kothari Petrochemicals HK Ltd, Hong Kong had closed down their operations during the financial year 2016-17. As there was no Holding-Subsidiary relationship at any time during the financial year 2017-18, consolidation of their financial statements is not applicable.

Note - 8 Previous year figures

Previous year figures have been regrouped/reclassified wherever necessary to correspond with current year’s classification /disclosure.


Mar 31, 2016

Note 1: Excise Duty

Excise Duty on sales for the year has been ''disclosed as reduction'' from the Turnover. Excise Duty relating to the difference between the closing stock and opening stock has been included in “Changes in Inventories of Finished goods Note-21” for current year.

Note 2: Commitments

Estimated amount of Contracts remaining to be executed on capital account for Rs.225.71 Lakhs (Previous year Rs.6.19 Lakhs)

Note 3 : Contigent Liability

Excise Duty demands against which the company has filed appeals and for which no provision is considered, as outcome of appeals is not ascertainable at this stage is Rs.154.72 Lakhs. (Previous year Rs.154.72 Lakhs).

Note 4: Employee Benefits

Liability to existing employees of the company in respect of gratuity is covered under a common insurance policy administered by a Trust maintained for the participating enterprises Viz. Kothari Sugars & Chemicals Limited (KSCL) and Kothari Petrochemicals Limited (KPL).The actuarial valuation is done by an independent external valuer under the projected unit credit method to ascertain the liability enterprise wise. The net defined benefit is recognized in the financial statement as a cost equal to their contribution payable estimated.

The company has recognized Rs.2.26 Lakhs (previous year Rs.3.69 Lakhs) in the Statement of Profit & Loss for the year ended 31st March 2016.

Note 5: Micro, Small and Medium Enterprises Development Act, 2006

The company has not received information from vendors regarding their status under Micro, Small and Medium Enterprises Act, 2006, the disclosure relating to amounts unpaid as at the yearend together with interest payable / paid under this Act have not been given.

Note 6: Operating Lease

A sum of Rs.137.07 Lakhs (previous Year Rs.137.09 Lakhs) has been debited to rent account, being the rent paid on premises which has been taken on operating lease.

Note 7: Acknowledgement of Balances

Balances in Trade Receivables, Loans and Advances and Deposits include items which are in the process of confirmation and have, in the opinion of the management a value on realization in the ordinary course of business at least equal to the amount at which they are stated. Trade Payables are stated at a value they are liable to be paid.

Note 8: Urban Land Tax

No provision is considered necessary towards Urban Land Tax for the Land in which Manali factory is situated pending disposal of a court case filed by the erstwhile owners and completion of process for registration of Land.

Note 9: Previous year Figures

Previous year figures have been regrouped/reclassified wherever necessary to correspond with current year''s classification /disclosure.


Mar 31, 2015

Note 1:

A. CORPORATE INFORMATION:

Kothari Petrochemicals Limited (Company) was incorporated on 28th April, 1989. The Corporate Identification Number (CIN) is L11101TN1989PLC017347. The company is into manufacture of chemicals since its inception in 1989 and at present the company is one of the largest producers of Poly Iso Butene (PIB) in India.

Note 2: Excise Duty

Excise Duty on sales for the year has been 'disclosed as reduction' from the Turnover. Excise Duty relating to the difference between the closing stock and opening stock has been included in "other operating revenue under Note 18" for the current year.

Note 3: Commitments

Estimated amount of Contracts remaining to be executed on capital account for Rs.6.19 Lacs (Previous year Rs. 19.92 Lacs) Note 28 : Contigent Liability

Excise Duty demands against which the company has filed appeals and for which no provision is considered, as out come of appeals is not ascertainable at this stage is Rs.154.72 lacs. (Previous year Rs.154.72 lacs).

Note 4: Value of Raw Materials,Chemicals and Stores and Spares consumed

Note 5: Related Part Transactions:

Refer separate working on Related Party Transactions in Annexure - I at Page Nos. 67 - 68 Note 33: Earnings in Foreign Currency Realised During the year

Note 6: Employee Benefits:

Liability to existing employees of the company in respect of gratuity is covered under a common insurance policy administered by a Trust maintained for the participating enterprises viz. Kothari Sugars & Chemicals Limited (KSCL) and Kothari Petrochemicals Limited (KPL). The actuarial valuation is done by an independent external valuer under the projected unit credit method to ascertain the liability enterprise wise.The net defined benefit is recognised in the financial statement as a cost equal to their contribution payable estimated.

The company has recognised Rs.3.69 Lacs (previous year Rs.Nil) in the Statement of Profit & Loss for the year ended 31st March 2015.

Note 7: Segment reporting Segment Information :

a) The company has only one primary business segment that of Manufacturing Poly Iso Butene.

b) Secondary Reporting Segment (by Geographical Segment)

Note 8: Micro,Small and Medium Enterprises Development Act, 2006:

The company has not received information from vendors regarding their status under Micro, Small and Medium Enterprises Act, 2006, the disclosure relating to amounts unpaid as at the year end together with interest payable / paid under this Act have not been given.

Note 9: Operating Lease

A sum of Rs.137.09 Lacs (previous Year Rs.113.63 Lacs) has been debited to Rent account, being the rent paid on premises which has been taken on operating lease.

Note 10: Acknowledgement of Balances

Balances in Trade Receivables, Loans and Advances and Deposits include items which are in the process of confirmation and have, in the opinion of the management a value on realisation in the ordinary course of business at least equal to the amount at which they are stated. Trade Payables are stated at a value they are liable to be paid.

Note 11: Urban Land Tax

No provision is considered necessary towards Urban Land Tax for the Land in which Manali factory is situated pending disposal of a court case filed by the erstwhile owners and completion of process for registration of Land.

Note 12: Depreciation

The Company has changed the method of providing Depreciation from 1st April 2014 as required by Companies Act, 2013. Depreciation is hence provided in accordance with Schedule II for the current year as against the rates specified Schedule XIV to the companies Act,1956 adopted in the previous year. As a result Depreciation in the current year higher by Rs.24.50 lacs.

Further in respect of asets whose remaining useful life as prescribed in Schedule II to Companies Act 2013 is Nil, their carrying amounts as on 01st April 2014 after retaining the residual value aggregating to Rs.127.92 (excluding Deferred Tax Rs.43.48 lacs) has been taken to Reserves and Surplus.

Note 13: Previous Year Figures

Previous year figures have been regrouped / reclassified whereever necessary to correspond with current year's classifications / disclosure.

Related party disclosures - As identified by the Management and relied upon by the Auditors

(i) Parties with Significant influence (Direct and Indirect)

Promoter Company Kothari Sugars & Chemicals Ltd.

Holding Company BHK Trading Pvt. Ltd.

Company in Joint Control Kothari International Trading Ltd.

Company in Joint Control Santoor Commercials Pvt. Ltd.

Company in Joint Control Kothari Biotech Ltd.

Company in Joint Control Kothari Safe Deposits Ltd.

Company in Joint Control Century Foods Pvt. Ltd.

Company in Joint Control Parvathi Trading & Finance Co. Pvt. Ltd.

Company in Joint Control HCK NAPC Mines and Ores Pvt. Ltd.

Company in Joint Control Parasakthi Trading Co. Pvt. Ltd.

Affiliated Trust HCK Education and Development Trust

Wholly owned Subsidiary Kothari Petrochemicals Pte. Ltd., Singapore

Step down Subsidiary Kothari Petochemicals HK Ltd., Hong Kong

(ii) Key Management Personnel

Chairman Mr. B H Kothari (till 22nd February 2015)


Mar 31, 2014

Note 1: Excise Duty

Excise Duty on Sales for the year has been ''disclosed as reduction'' from the Turnover. Excise Duty relating to the difference between the closing stock and opening stock has been included in " other operating revenue under Note -19" for the current Year.

Note 2:

A. CORPORATE INFORMATION:

Kothari Petrochemcials Limited ( Company) was incorporated on 28th April, 1989. The Corporate Identification Number (CIN) is L11101TN1989PLC017347. The company is into manufacture of chemicals since its inception in 1989 and at present the company is one of the largest producers of premium quality Poly Isobutene in India.

Note 3: Commitments

Estimated amount of Contracts remaining to be executed on capital account for Rs. 19.92 Lacs (Previous year Rs. Nil)

Note 4: Contingent Liabilities

a. Bank guarantees Rs. 395.88 (Previous year. Rs. 383.58 Lacs)

b. Sales-tax and Excise Duty demands against which the Company has filed appeals and for which no provision is considered, as the outcome of the appeals is not ascertainable at this stage is Rs.154.72 lacs (Previous Year Rs. 157.88 lacs)

Note 5: Employee Beneits:

Liability to existing employees of the company in respect of gratuity is covered under a common insurance policy administered by a Trust maintained for the participating enterprises viz. Kothari Sugars & Chemicals Limited (KSCL) and Kothari Petrochemicals Limited (KPL). The actuarial valuation is done by an independent external valuer under the Projected Unit Credit method to ascertain the liability enterprise wise. The net defined benefit is recognized in the financial statement as a cost equal to their contribution payable estimated

The Company has recognized Rs. Nil amount (Previous Year Rs.6.94 Lacs) in the Statement of Profit & Loss for the Year ended 31st March, 2014.

Note 6: Micro, Small and Medium Enterprises Development Act, 2006:

The company has not received information from vendors regarding their status under Micro Small and Medium Enterprises Act 2006, the disclosures relating to amounts unpaid as at the year end together with interest payable / paid under this Act have not been given.

Note 7: Operating Lease

A sum of Rs. 113.63 lacs (Previous Year Rs.36.90 lacs) has been debited to Rent account, being the rent paid on premises which has been taken on operating lease.

Note 8: Earning Per Share

Net Profit after Tax for the year has been used as the numerator and number of Shares has been used as denominator for calculating the basic and diluted earning per Share.

Note 9: Acknowledgement of Balances

Balances in Trade Receivables, Loans and Advances and Deposits include items which are in the process of confirmation and have, in the opinion of the management a value on realisation in the ordinary course of business at least equal to the amount at which they are stated. Sundry Creditors are started at a value they are liable to be paid.

Note 10: urban Land Tax

No provision is considered necessary towards urban land tax for the land in which Manali factory is situated pending disposal of a court case filed by the erstwhile owners and completion of the Process for registration of land.

Note 11:

Previous Year''s figures have been regrouped / reclassified wherever necessary to correspond with current year''s classification / disclosure


Mar 31, 2013

A. CORPORATE INFORMATION:

Kothari Petrochemicals Limited (Company) was incorporated on 28*April, 1989. The Corporate Identification Number (CIN) is L11101TN1989PLC017347. The company is into manufacture of Chemicals since its inception in 1989, the company has been enjoying a strong market position in India with a rapidly growing brand across the globe that represents quality, customer responsiveness, dependability and a commitment to the environment and at present the company is one of the largest producers of premium quality Poly Iso butene in India.

Note 1: Excise Duty

Excise Duty on Sales for the year has been ''disclosed as reduction''from the Turnover. Excise Duty relating to the difference between the closing stock and opening stock has been included in Note-26 "Other Expenses" for the current year and in Note-19 "Other Operating Revenue" for the previous year.

Note 2: Commitments

Estimated amount of Contracts remaining to be executed on capital account for Rs.Nii (Previous Year Rs.Nil) Note 29: Contingent Liabilities

a. Bank guarantees Rs.383.58 Lacs (Previous year.Rs.328.44 Lacs)

b. Sales-tax and Excise Duty demands against which the Company has filed appeals and for which no provision is considered, as the outcome of the appeals is not ascertainable at this stage is Rs.157.88 Lacs (Previous Year Rs.157.88 Lacs)

Note 3: Value of Raw Materials, Chemicals and Stores and Spares consumed:

Note 4: Employee Benefits:

Liability to existing employees of the company in respect of gratuity is covered under a common insurance policy administered by a Trust maintained for the participating enterprises viz. Kothari Sugars & Chemicals Limited (KSCL) and Kothari Petrochemicals Limited (KPL). The Actuarially valued liabilityunderthe Projected Unit Credit method for the employees of the participating enterprise of the Trust is calculated enterprise wise. The net defined benefit is recognized in the financial statement as a cost equal to their contribution payable estimated.

Note 5: Segment Reporting Segment Information

a) Primary segment reporting (by Business Segments)

(i) The Company has considered business segment as the primary segment for disclosure these are:

(i) Poly Iso Butene (PIB)

(ii) Power Generation (Wind Mill)

Note 6: Micro, Small and Medium Enterprises Development Act, 2006:

The company has not received information from vendors regarding their status under Micro Small and Medium Enterprises Act 2006, the disclosures relating to amounts unpaid as at the year end together with interest payable / paid under this Act have not been given.

Note 7 Rental Income

Asum of Rs. 123.02 lacs (PreviousYear Rs.55.81 lacs) has been considered as rental Income from property pending finalization of Lease agreement.

Note 8: Operating Lease

A sum of Rs.36.90 lacs ( Previous Year Rs.32.80 lacs ) has been debited to Rent account, being the rent paid on premises which has been taken on operating lease.

Note 9: Earning Per Share

Net Profit after Tax for the year has been used as the numerator and number of Shares has been used as denominator for calculating the basic and diluted earning per Share.

Note 10: Discontinuing Operations

During the year, the power generation operations have been discontinued and Windmill was sold on 21st February, 2013 for Rs.915.50 lacs.

Note 11: Acknowledgement of Balances

Balances in Trade Receivables, Loans and Advances and Deposits includes items which are in the process of confirmation and have, in the opinion of the management a value on realisation in the ordinary course of business at least equal to the amount at which they are stated. Sundry Creditors are started at a value they are liable to be paid.

Note 12: Urban Land Tax

No provision is considered necessary towards Urban Land Tax for the land in which Manali factory is situated pending disposal of a court case filed by the erstwhile owners and completion of the process for registration of land.

Note 13: Previous Year''s figures have been regrouped / reclassified wherever necessary to correspond with current year''s classification / disclosure.


Mar 31, 2012

Note - 1 - Excise Duty

Excise Duty on Sales for the year has been 'disclosed as reduction' from the Turnover. Excise Duty relating to the difference between the closing stock and opening stock has been included in Note-20 "Other income" for the Current Year and in Note-26 "Other Expenses" for the previous year.

Note - 2 - Commitments

Estimated amount of Contracts remaining to be executed on Capital account and not provided for Rs. NIL (Rs.925 lacs)

Note - 3 - Contingent Liabilities

a. Bank guarantees Rs.328.44 Lacs (Previous year.Rs.318 Lacs)

b. Sales-Tax and Excise Duty demands against which the Company has filed appeals and for which no provision is considered, as the outcome of the appeals is not ascertainable at this stage Rs.157.88 lacs (Previous Year Rs.110.38 lacs)

Note - 4 Related Party Transactions:

Related party disclosures - As identified by the Management and relied upon by the auditors

(i) Parties with Significant influence (Direct and Indirect) (a) Promoter Company Kothari Sugars & Chemicals Limited

(b) Associate Company Kothari International Trading Limited

(c) Associate Company Kothari Safe Deposits Limited (d) Associate Company Century Foods Pvt. Limited

(e) Associate Company Parvathi Trading & Finance Co. Pvt. Limited

(ii) Key Management Personnel (a) Chairman & Managing Mr. B.H.Kothari Director

Note - 5 - Employee Benefits:

Liability to existing employees of the company in respect of gratuity is covered under a common insurance policy administered by a Trust maintained for the participating enterprises viz. Kothari Sugars & Chemicals Limited (KSCL) and Kothari Petrochemicals Limited (KPL). The Actuarially valued liability under the Projected Unit Credit method for the employees of the participating enterprise of the Trust is calculated enterprise wise. The net defined benefit is recognized in the financial statement as a cost equal to their contribution payable estimated. The Company has recognized Rs.3.73 lakhs (Previous Year Rs.6.66 lakhs) in the Statement of Profit & Loss for the Year ended 31st March, 2012. Accrued Liability towards Gratuity ascertained as per actuarial valuation is Rs.37.19 lacs which is covered by a common Insurance Policy reffered above.

Note - 6 - Micro, Small and Medium Enterprises Development Act, 2006:

The company has not received information from vendors regarding their status under Micro, Small and Medium Enterprises Act, 2006. The disclosures relating to amounts unpaid as at the year end together with interest payable/paid under this Act have not been given.

Note - 7 - Operating Lease

A sum of Rs.55.81 lacs (Previous Year Nil) has been recognized as rental Income from commercial property situated at Bengaluru pending finalization of Lease agreement.

Note - 8 - Acknowledgement of Balances

The Company has obtained confirmation of balances from all the banks and has sent confirmation of balances to Debtors and Creditors and responses have been received in a few cases.

Note - 9 - Urban Land Tax

No provision is considered necessary towards Urban Land Tax for the land in which Manali factory is situated pending disposal of a court case filed by the erstwhile owners and completion of the Process for registration of land.

Note - 10

The Revised Schedule VI has become effective from 1 April, 2011 for the preparation of financial statements. This has significantly impacted the disclosure and presentation made in the financial statements. Previous Year's figures have been regrouped/reclassified wherever necessary to correspond with current year's classification/ disclosure.


Mar 31, 2010

1. Acknowledgement of balances

The Company has obtained confirmation of balances from all the banks and has sent letter of request for confirmation of balances to Debtors and Creditors and replies have been received in a few cases.

2. Contingent Liabilities

a. Estimated amount of Contracts remaining to be executed on Capital account & not provided for amount to Rs. Nil (Rs.Nil )

b. Bank guarantees Rs. 318 lacs (Previous year.Rs.100 lacs)

c. Excise demand under appeal Rs.82.08 lacs.

3. The company has not received information from vendors regarding their status under Micro Small and Medium Enterprises Act 2006, the disclosures relating to amounts unpaid as at the year end together with interest payable/paid under this Act have not been given.

4. CIF Value of Imports : Nil

5. The Goodwill of Rs.753 lakhs arising out of the merger effective from 1st April 2006 of PTPL with the company is being amortized over a period of five years with effect from 1st April 2006 in equal install- ments. During the Year Rs.150.60 lakhs amortized being fourth Year.

6. No provision is considered necessary towards urban land tax for the land in which Manali factory is situated pending disposal of a court case filed by the erstwhile owners and completion of the process for registration of land.

7. Employee benefits

Liability to existing employees of the company in respect of gratuity is covered under a common insur- ance policy in favour of Kothari Sugars & Chemicals Gratuity Trust. The cumulative liability of the employees is actuarially valued by the trust under projected unit credit method. Investments available for policy and contribution being effected are adequate to cover the liability of the employees.

8. Previous year figures have been regrouped and rearranged wherever necessary to Confirm to the classification for the year.


Mar 31, 2000

1. Estimated value of contracts remaining to be executed on capital account and not provided for Rs.5,21,904/-(Rs.11,76,104)

2. Contingent liability on account of Bank Guarantee Rs.53.70 Lacs (Rs.53.10 Lacs)

3. Outstanding letters of credit for import of spares Rs.9.85 Lacs (Rs. 1.21. Lacs)

4. Future lease rental commitments Rs.91,77,862/- (Rs.1,43,81,996/-)

5. The balances in debtors, advances and sundry creditors have been circularised and replies are awaited. Loans and Advances include Rs.14,43,750/-covered by court cases. In the opinion of the Board the current assets, loans & advances will realise at least the values stated in the accounts.

6. Due by Manager- Rs.NIL (Rs.32,627)

Maximum amount outstanding at any time during the year Rs.32,627/- (Rs.75,827)

7. Sundry Creditors include Rs.10,03,502/-due to Small Scale and ancillary undertakings to the extent such parties have been identified by the management and relied upon by Auditors. The Company has normally made payments to SSI units in due time and also there being no claim from the parties, interest if any on overdue payments is unascertainable and thus not provided for. The names of SSI units to whom amounts of Rs.1 Lakh and above are due for more than 30 days are given below:

Ellak Chem Industries

Prem Chemical Industries

Shiva Alkaline Chemicals

8. Expenditure in foreign currency during the year on account of foreign travel was Rs.1,03,1167- (Rs.2,17,630)

9. The post of the Secretary which fell vacant on 30.04.2000 has not yet been filled up under Section 383 A of the Companies Act 1956.

10. Figures in brackets relate to previous year.

11. Previous years figures have been regrouped wherever necessary to conform to the classification for the year.

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