Notes to Accounts of Kridhan Infra Ltd.

Mar 31, 2018

1 Corporate Information

Kridhan Infra Limited (‘Kridhan’ or ‘the Company’) is a public limited company domiciled and incorporated in India having its registered office at 203, Joshi Chambers, Ahmedabad Street, Carnac Bunder, Masjid. Mumbai- 400 009. The Company’s shares are listed and traded on Stock Exchanges in India. The Company is engaged in the business of trading in iron and steel and allied materials.

2. Application of new Indian Accounting Standards

2.1 All the Indian Accounting Standards issued under section 133 of the Companies Act, 2013 and notified by the Ministry of Corporate Affairs (MCA) under the Companies (Indian Accounting Standards) Rules, 2015 (as amended) till the financial statements are authorized have been considered in preparation of these Financial Statements.

2.2 Standards issued but not yet effective

The MCA has notified the Companies (Indian Accounting Standards/ Ind AS) Amendment Rules, 2018 on 28 March, 2018, whereby Ind AS-115 relating to “Revenue from Contracts with Customers” and Appendix B to Ind AS 21 relating to “Foreign Currency Transactions and advance considerations” has been made applicable from financial year 2018-19 (i.e. 1 April, 2018 onwards).

Ind AS-115 relating to Revenue from Contracts with Customers

The Standard replaces the existing Ind AS 18 “Revenue” and Ind AS 11 “Construction Contracts”. Ind AS 115 establishes the principles that an entity shall apply to report useful information to users of financial statements about the nature, amount, timing and uncertainty of revenue and cash flows arising from a contract with a customer.

Ind AS 21 - Appendix B - Foreign currency transactions and advance consideration

This Appendix applies to a foreign currency transaction (or part of it) when an entity recognises a non-monetary asset or nonmonetary liability arising from the payment or receipt of advance consideration before the entity recognises the related asset, expense or income (or part of it).

The Company has evaluated the requirements and based on its assessment it is of the view that there is no material impact on account of the same.

3. Critical Accounting Judgments, Assumptions and Key Sources of Estimation Uncertainty

Inherent in the application of many of the accounting policies used in preparing the Financial Statements is the need for Management to make judgments, estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities, and the reported amounts of revenues and expenses. Actual outcomes could differ from the estimates and assumptions used.

Estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimates are revised and future periods are affected.

Key source of judgments, assumptions and estimation uncertainty in the preparation of the Financial Statements which may cause a material adjustment to the carrying amounts of assets and liabilities within the next financial year, are in respect of impairment, useful lives of Property, Plant and Equipment, employee benefit obligations, impairment, provision for income tax, measurement of deferred tax assets and contingent assets and liabilities.

3.1 Critical judgments in applying accounting policies

The following are the critical judgements, apart from those involving estimations (Note 4.2), that the Management have made in the process of applying the Company’s accounting policies and that have the significant effect on the amounts recognized in the Financial Statements.

(a) Determination of functional currency

Currency of the primary economic environment in which the Company operates (“the functional currency”) is Indian Rupee (‘) in which the Company primarily generates and expends cash. Accordingly, the Management has assessed its functional currency to be Indian Rupee (‘).

(b) Classification of investment

Judgement is required in assessing the level of control obtained in a transaction to acquire an interest in another entity; depending upon the facts and circumstances in each case, the Company may obtain control, joint control or significant influence over the entity or arrangement. Transactions which give the Company control of a business are business combinations. If the Company obtains joint control of an arrangement, judgement is also required to assess whether the arrangement is a joint operation or a joint venture. If the Company has neither control nor joint control, it may be in a position to exercise significant influence over the entity, which is then classified as an associate.

3.2 Assumptions and key sources of estimation uncertainty

Information about estimates and assumptions that have the significant effect on recognition and measurement of assets, liabilities, income and expenses is provided below. Actual results may differ from these estimates.

Impairment of assets

Determination as to whether, and by how much, asset is impaired involves Management estimates on uncertain matters such as future prices, the effects of inflation on operating expenses, discount rate etc.

4.1: The Company has elected to continue with the carrying value of its investments in subsidiaries and associates, measured as per the Previous GAAP and used that carrying value on the transition date April 1, 2016 in terms of Para D15 (b) (ii) of Ind AS 101 ‘First -time Adoption of Indian Accounting Standards’.

5.1: The average credit period on sales is 60 - 90 days. No interest is charged during this credit period. Thereafter, interest on delayed payments is charged at SBI Base rate plus 4%-6% per annum compounded each quarter on the outstanding balance.

5.2: There is no single party concentration of the receivables.

5.3: Further, based on assessement made by the management, depending on the past history, management does not expect any material loss on realisation of these receivables.

a) Shares alloted during the year includes shares allotted for consideration other wise than in cash for Rs. 153.59 Lakhs consequent to the share purchase agreement entered into with the shareholders of the Associate company for acquiring their share(s)

b) Details of amount received on allotment of shares on Qualified Institutional Placement :

During the year the company has made placement of 130,07,778 equity shares (Face Value of Rs. 2) on QIP basis at a premium of Rs. 97 per share for an aggregate of 12877.70 Lakhs. The funds raised have been utilised for the purpose as stated in the Objects of the Issue clause of the Placement Document filed with respective regulatory authorities.

Note 6.1 Terms / rights attached to equity shares

The Company has only one class of equity shares having a par value of Rs. 2 per share. Each holder of equity shares is entitled to one vote per share. The dividend proposed by the Board of Directors shall be subject to the approval of the shareholders in the ensuing Annual General Meeting.

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

Security Details

i) The Term Loan facility from Banks along with interest are secured (incl additional security) by EM of Factory, Land and Building of the plant of the company at Khopoli.

ii) Further secured by Personal Guarantee of Anil Agrawal .

iii) Vehicle Loan are secured against the respective vehicles.

Terms of Repayment details

The term loan represents vehicle loan which is repayable in 63 EMI upto 2023.

Note 7 Liquidity risk

Liquidity risk is the risk that the Company will not be able to meet its financial obligations as they become due. The Company manages its liquidity risk by ensuring, as far as possible, that it will always have sufficient liquidity to meet its liabilities when due, under both normal and stressed conditions, without incurring unacceptable losses or risk to the Company’s reputation.

The Company has obtained term loans and working capital facilities from banks.

As of March 31, 2018, the Company had working capital (Total current assets - Total current liabilities) of Rs. 14,615.31 Lakhs including cash and cash equivalents of Rs. 87.59 Lakhs. As of March 31, 2017, the Company had working capital (Total current assets - Total current liabilities) of ‘4,025 Lakhs including cash and cash equivalents of Rs. 38.89 Lakhs

Exposure to liquidity risk

The table below analyses the Company’s financial liabilities into relevant maturity groupings based on their contractual maturities for all non derivative financial liabilities

Note 8 Capital management

For the purpose of the Company’s capital management, capital includes issued equity capital, share premium and all other equity reserves attributable to the equity holders of the parent. The primary objective of the Company’s capital management is to maximise the shareholder value.

The Company manages its capital structure and makes adjustments in light of changes in economic conditions and the requirements of the financial covenants. To maintain or adjust the capital structure, the Company may adjust the dividend payment to shareholders, return capital to shareholders or issue new shares. The Company monitors capital using a gearing ratio, which is net debt divided by total capital plus net debt. The Company’s policy is to keep optimum gearing ratio. The Company includes within net debt, interest bearing loans and borrowings, trade and other payables, less cash and cash equivalents, excluding discontinued operation.

Note 9 Details of dues to micro and small enterprises as per MSMED Act, 2006

There are no Micro and Small Enterprises as defined in the Micro and Small Enterprises Development Act, 2006 to whom the company owes dues on account of principal amount together with interest and accordingly no additional disclosures have been made. The above information regarding Micro and Small Enterprises has been determined to the extent such parties have been identified on the basis of information available with the company.

Note 10 Fair Values

The carrying values of financials instruments of the Company are reasonable and approximations of fair values.

The management assessed that cash and cash equivalents, trade receivables, trade payables, bank overdrafts and other current liabilities approximate their carrying amounts largely due to the short-term maturities of these instruments.

Note 11 Financial instruments - Fair values and risk management Risk management framework

The Company’s activities expose it to a variety of financial risks, including revenue risk,market risk, credit risk and liquidity risk. The Company’s primary risk management focus is to minimize potential adverse effects of revenue risk. The Company’s risk management assessment and policies and processes are established to identify and analyze the risks faced by the Company, to set appropriate risk limits and controls, and to monitor such risks and compliance with the same. Risk assessment and management policies and processes are reviewed regularly to reflect changes in market conditions and the Company’s activities. The Board of Directors and the Audit Committee is responsible for overseeing the Company’s risk assessment and management policies and processes.

Credit risk

Credit risk is the risk of financial loss to the Company if a customer or counter party to a financial instrument fails to meet its contractual obligations, and arises principally from the Company’s receivables from customers. The company’s primary business is dealing in Iron and Steel products which is on credit to parties and are subjected to assessment of creditworthiness. The creditworthiness is periodically reviewed for any high credit risk receivable. Based on such assessment the management is of the view that there is a moderate credit risk in respect of its trade receivables.

Trade and other receivables

The company’s primary business is trading and providing services. There are certain receivables arising from the same for which required assessment of credit worthiness is being carried out by the company on a recurring basis based on which the company is of the view that there are no significant expected losses on account of its trade receivables. The age-wise breakup of the receivables is as under:

Summary of the Company’s exposure to credit risk by age of the outstanding from its customers is as follows:

Expected credit loss assessment for customers as at 1st April, 2016, 31st March, 2017 and 31st March, 2018

Exposures to customers outstanding at the end of each reporting period are reviewed by the Company to determine incurred and expected credit losses. Historical trends of impairment of trade receivables do not reflect any significant credit losses. Given that the macro economic indicators affecting customers of the Company have not undergone any substantial change, the Company expects the historical trend of minimal credit losses to continue. Further, management believes that the unimpaired amounts that are past due by more than 30 days are still collectible in full, based on historical payment behaviour and extensive analysis of customer credit risk. Hence, the company has not recognized any provision for expected credit loss till date.

Cash and cash equivalents: Out of total Cash and Cash equivalent of Rs. 87.59 Lakhs; 38.89 Lakhs and Rs. 40.07 Lakhs as at March 31, 2018, March 31, 2017 and April 1, 2016 respectively, the Company held cash and cash equivalents with credit worthy banks and financial institutions of Rs. 78.81 Lakhs, Rs. 23.17 Lakhs and Rs. 17.55 Lakhs 31st March 2018, 31st March 2017 and April 1, 2016 respectively. The credit worthiness of such banks and financial institutions is evaluated by the management on an ongoing basis and is considered to be good.

Guarantees

The Company has provided the following financial guarantees:

Corporate guarantees have been given to assist subsidiaries in availing banking facilities.

Bank guarantees are performance bank guarantees given to customers.

Security deposits given to lessors

The Company has not taken any premises on lease basis hence, the said disclosure is not applicable.

Loans, investments in group companies

The Company has given unsecured loans to its subsidiary / associates companies and their Directors / KMP (including step down subsidiaries) of Rs. 9434.17 Lakhs; Rs. 1284.83 Lakhs and Rs. 92.89 Lakhs as at 31 March 2018, 31 March 2017 and April 1, 2016 respectively. The Company does not perceive any credit risk pertaining to loans provided to its subsidiaries /associate companies.

Other than trade and other receivables, the Company has no other financial assets that are past due but not impaired. Note 37 Financial risk management objectives and policies

The Company’s risk management policies are established to identify and analyse the risks faced by the Company, to set appropriate risk limits and controls, and to monitor risks and adherence to limits. Risk management policies and systems are reviewed regularly to reflect changes in market conditions and the Company’s activities.

The Board of Directors has overall responsibility for the establishment and oversight of the Company’s risk management framework.

In performing its operating, investing and financing activities, the Company is exposed to the Credit risk, Liquidity risk and Currency risk.

Market Risk

Market risk is the risk that the fair value of future cash flows of a financial instrument will fluctuate because of changes in market prices. Market risk comprises three types of risk: interest rate risk, currency risk and other price risk, such as equity price risk and commodity risk. Financial instruments affected by market risk include loans and borrowings, deposits, FVTOCI investments and derivative financial instruments.

The following table summaries the carrying amount of financial assets and liabilities recorded at the end of the period by categories:

The sensitivity analyses in the following sections relate to the position as at March 31, 2018, March 31, 2017 and April 01, 2016.

The sensitivity analyses have been prepared on the basis that the amount of net debt, the ratio of fixed to floating interest rates of the debt and derivatives and the proportion of financial instruments in foreign currencies are all constant and in place at March 31, 2018.

The following assumptions have been made in calculating the sensitivity analyses:

The sensitivity of the relevant profit or loss item is the effect of the assumed changes in respective market risks. This is based on the financial assets and financial liabilities held at March 31,2018, March 31, 2017 and as at April 01, 2016.

Credit risk on Financial Assets

The company is engaged in the business of trading in Iron and Steel. Payments by it are typically not secured by any form of credit support such as letters of credit, performance guarantees or escrow arrangements. Credit risk is the risk that counterparty will not meet its obligations under a financial instrument, leading to a financial loss. The Company is exposed to credit risk from its operating activities and from its financing activities, including deposits with banks, foreign exchange transactions and other financial instruments.

Financial assets that are potentially subject to concentrations of credit risk and failures by counter-parties to discharge their obligations in full or in a timely manner consist principally of Trade Receivables, Loans and Advances and other assets. Credit risk on cash balances with Bank are limited because the counterparties are entities with acceptable credit ratings. The exposure to credit risk for trade receivable is low as it mainly consists of customers who are assessed by the management and the collection is received on timely basis within the credit period which is about 60 to 90 days.

Ageing analysis of the age of trade receivable amounts that are past due as at the end of reporting year but not impaired:

The liquidity risk is managed on the basis of expected maturity dates of the financial liabilities.

The average credit period taken to settle trade payables is about 30 to 90 days. The other payables are with short-term durations. The carrying amounts are assumed to be a reasonable approximation of fair value.

Financial instruments and cash deposits

Credit risk from balances with banks and financial institutions is managed by the Company’s top management in accordance with the Company’s policy. Investments of surplus funds are made only with approved counterparties and within credit limits assigned to each counterparty. Counterparty credit limits are reviewed by the top management on an annual basis, and may be updated throughout the year subject to approval of the Company’s Board of Directors. The limits are set to minimise the concentration of risks and therefore mitigate financial loss through counterparty’s potential failure to make payments.

The Company’s maximum exposure to credit risk for the components of the Balance Sheet at March 31, 2018, March 31, 2017 and as at April 01, 2016 is the carrying amounts as illustrated in Note 12 & 14. The Group’s maximum exposure relating to financial guarantees and financial derivative instruments is noted in notes and the liquidity table below.

Interest Rate

The company does not operate in an industry that requires intense capital and hence the expsoure to interest rate risk is reasonably moderate. The major component of the interest charge for the company is denominated in variable risk instruments which are basically in the form of loan from banks and FI’s. The details of the borrowings of the company is given in the respective notes on borrowings.

The interest rate risk exposure is mainly from changes in fixed and floating interest rates. The interest rates are disclosed in the respective notes to the financial statement of the Company. The following table analyse the breakdown of the financial assets and liabilities by type of interest rate:

Interest rate sensitivity

The following table demonstrates the sensitivity to a reasonably possible change in interest rates on that portion of loans and borrowings affected, after excluding the credit exposure for which interest rate swap has been taken and hence the interest rate is fixed. With all other variables held constant, the Company’s profit before tax is affected through the impact on floating rate borrowings, as follows:

Liquidity risk

Liquidity risk is the risk that the Company may not be able to meet its present and future cash and collateral obligations without incurring unacceptable losses. The Company’s objective is to, at all times maintain optimum levels of liquidity to meet its cash and collateral requirements. The Company closely monitors its liquidity position and deploys a robust cash management system. It maintains adequate sources of financing including debt and overdraft from banks at an optimised cost.

The Company’s maximum exposure to credit risk for the components of the balance sheet at March 31,2018, March 31, 2017 and as at April 01, 2016 is the carrying amounts as illustrated in Note 18. The Company’s maximum exposure relating to financial guarantees are noted in the liquidity table below .

Note 12

During the year the company has received the amounts for allotment of share warrants, to be converted into shares of the company on 05-Jun-2019. The company has received the 25% value of such warrants aggregating to Rs. 506.25 Lakhs

Note 13

The company has one subsidiary each in Singapore namely Readymade Steel Singapore Pte Ltd. and in India namely Kridhan Infrasolutions Pvt. Ltd. The company has made long term investment in the equity of these companies.

Note 14

Fixed Assets, Stocks and Cash balance were physically verified by the management. The Certification of the same given by the managment has been relied upon by the auditors.

Note 15

The current assets, loans and advances have the values at least equal to the amount at which they are stated in the Balance sheet on their realisation in ordinary course of business. Provisions for all known liabilities are adequate and not in excess of the amount reasonably necessary.

Note 16

Balances of Current Assets and Current Liabilities are subject to confirmation and consequential adjustment, if any. During the year, the managemet has done assignment of some of its receivables / payables as per mutual discussions with the respective parties. The necessary documentation in respect of the same are under execution.

Note 17

In absence of the parties registered as micro and small as defined under the Micro Small & Medium Enterprise Development (MSMED) Act 2006, the relevant information has been considered as NIL. Hence, the required disclosure under the MSMED Act are not given.

Note 18 Segment Reporting

The company operates in only one segment. Hence, there are no other reportable segment as per AS - 17 issued by ICAI. Note 48 First-time adoption of lnd AS

These financial statements, for the year ended March 31, 2018 and March 31, 2017 are prepared in accordance with Ind AS. For periods up to and including the year ended March 31, 2017, the Company prepared its financial statements in accordance with accounting standards notified under section 133 of the Companies Act 2013, read together with paragraph 7 of the Companies (Accounts) Rules, 2014 (Indian GAAP).

Accordingly, the Company has prepared financial statements which comply with Ind AS applicable for the year ending on March 31, 2018, together with the comparative period data as at and for the year ending on March 31, 2017, as described in the summary of significant accounting policies. In preparing these financial statements, the Company’s opening balance sheet was prepared as at April 1, 2016, the Company’s date of transition to Ind AS. This note explains the principal adjustments made by the Company in restating its Indian GAAP financial statements, including the balance sheet as at April 1, 2016 and the financial statements as at and for the year ended March 31, 2018 and year ended March 31, 2017.

Since, there is no change in the functional currency, the company has elected to continue with the carrying value for all of its Property, Plant and Equipment (PPE) as recognised in its previous GAAP financial as deemed cost at the transition date except in respect of land which has been carried at fair value as on the transition date.

Note 19 Events after reporting period

No subsequent events that would have a material impact on the financials were observed after the reporting period.

Note 20 Gratuity as Defined contribution benefits Scheme

Defined Benefit Plan

Under the said Act, employee who has completed 5 years of service is entitled to specific benefit. The level of benefits provided depends upon the strength of service of the employees and the salary at the retirement age.

Following table summarises the components of net benefit expenses recognised in the statement of Profit and Loss and amounts recognised in the balance sheet for the gratuity plan:

The company has carried out an Actuarial Valuation for the first time during the year to evaluate the likely liability on account of terminal benefits of its employees. Till the previous year ended March 31, 2017, the company has estimated the amount of liability and hence the previous period figures are not strictly comparable.

Note 21

The Financial statements were authorised for issue in accordance with a resolution of the Directors dated May 29, 2018.

Note 22

Previous years’ figures have been regrouped / reclassified wherever necessary to confirm to current classification.

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Mar 31, 2016

a) Security Details

i) The Term Loan facility from Banks along with interest are secured (incl additional security) by EM of Factory, Land and Building of the plant of the company at Khopoli.

ii) Further secured by Personal Guarantee of Anil Agrawal.

b) Repayment Schedule

The term loans are repayable in 72 EMI commencing from April 2009

1. Fixed Assets, Stocks and Cash balance were physically verified by the management. The Certification of the same given by the management has been relied upon by the auditors.

2. The current assets, loans and advances have the values at least equal to the amount at which they are stated in the Balance sheet on their realization in ordinary course of business. Provisions for all known liabilities are adequate and not in excess of the amount reasonably necessary.

3. Balances of Current Assets and Current Liabilities are subject to confirmation and consequential adjustment, if any. During the year, the management has done assignment of some of its receivables / payables as per mutual discussions with the respective parties. The necessary documentation in respect of the same are under execution.

4. In absence of the parties registered as micro, small or medium as defined under the Micro Small & Medium Enterprise Development (MSMED) Act 2002, the relevant information has been considered as NIL. Hence, the required discloses under the MSMED Act are not given.

5. In view of the nature of the business of the company being as per the specification of the customers, the quantitative details are given to the extent available and are not of comparable items.

6 The company has accounted for liability on account of Employee retirement benefits on accrual basis but the same is not on actuarial basis as the amount of the same is not material. However, the actuarial valuation for the same shall be done in the coming year.

7 The company has one subsidiary each in Singapore namely Readymade Steel Singapore Pte Ltd. and in India namely Kridhan Infrasolutions Pvt. Ltd. The company has made long term investment in the equity of these companies.

The company has received notices of demand from Office of Income Tax for '' 68.76 lacs for which it has filed / represented at appropriate forums and are pending at these forums. Based on the progress made and as per the best estimates made by the company, based on legal opinion obtained, the company will not be required to pay any material amount in respect of the same.

8. During the year, the company has converted its share warrants into capital, in tranches, for which full amount of the consideration had been received. In respect of some share warrants, the amount payable had not been received and accordingly, after due approval and in compliance with required formalities, these warrants had been forfeited. The amount already received, being in the nature of capital receipt has been credited to Capital Reserve.

9. Previous year’s figures have been regrouped, rearranged and reclassified wherever necessary to conform to current year’s presentation.

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Mar 31, 2015

1. Fixed Assets, Stocks and Cash balance were physically verified by the management. The Certification of the same given by the management has been relied upon by the auditors.

The current assets, loans and advances have the values at least equal to the amount at which they are stated in the Balance sheet on their realization in ordinary course of business. Provisions for all known liabilities are adequate and not in excess of the amount reasonably necessary.

2. Balances of Current assets and current liabilities are subject to confirmation and consequential adjustment, if any. During the year, the management has done assignment of some of its receivables/payables as per mutual discussions with the respective parties. The necessary documentation in respect of the same are under execution.

3. In absence of the parties registered as micro, small or medium as defined under the Micro Small & Medium Enterprise Development Act 2002, the relevant information has been considered as NIL. Hence, the required disclosure under the MSMED Act are not provided.

4. In view of the nature of the business of the company being as per the specification of the customers, the quantitative details are given to the extent available and are not of comparable items.

The company has two subsidiaries Readymade Steel Singapore Pte Ltd. and Kridhan Infra Solution Private Limited. The company has made long term investment in the equity of these companies.

5. Contingent liabilities not provided for: Amount in Rs. Lacs Corporate Guarantees issued to parties 17.43 (17.43] Income tax and VAT liabilities in respect of pending/ ongoing assessments Not Ascertainable

6. During the year the company, pursuant to necessary approval, the company has split its share of face value of Rs. 10 each to face value of Rs. 2. each

7. The company has during the year converted share warrants aggregating to Rs. 124.50 Lacs. As at the reporting date the company carries the balance amount of share warrant money which shall be converted after necessary approval / formalities in this regard.

8. Previous year figures have been regrouped, rearranged and reclassified wherever necessary to conform to current years presentation.

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Mar 31, 2014

A) Rights and Preference attached

The company has only one class of equity shares having par value of `10 per share.Each share holder of equity shares is entitled to one vote per share. In the event of liquidation of the company, the holders of the equity shares will be entitled to receive remaining assets of the company, after distribution of preferential amounts. The distribution will be in proportion to the number of equity shares held by the shareholder.

1.1 : LONG TERM BORROWINGS

a) Security Details

i) The Term Loan facility from Banks are along with interest are secured (incl additional security) by EM of Factory, Land and Building of the plant of the company at Khopoli

ii) Further secured by Personal Guarantee of Anil Agarwal

b) Repayment Schedule

The term loans are repayable in 72 EMI commencing from April 2009

1.2 : TRADE PAYABLES

There is no supplier covered under the Micro, Small and Medium Enterprises Development Act, 2006 (the Act). This information and the information given above has been determined based on the details regarding the status of the suppliers obtained by the Company. This has been relied upon by the auditors.

1.3 Fixed Assets, Stocks and Cash balance were physically verified by the management. The Certification of the same given by the managment has been relied upon by the auditors.

1.4 The current assets, loans and advances have the values at least equal to the amount at which they are stated in the Balance sheet on their realisation in ordinary course of business. Provisions for all known liabilities are adequate and not in excess of the amount reasonably necessary.

1.5 Balances of Current assets and current liabilities are subject to confirmation and consequential adjustment, if any. During the year, the managemet has done assignment of some of its receivables / payables as per mutual discussions with the respective parties. The necessary documentation in respect of the same are under execution.

1.6 In absence of the parties registered as micro, small or medium as defined under the Micro Small & Medium Enterprise Development Act 2002, the relevant information has been considered as NIL. Hence, the required discloses under the MSMED Act are not given.

1.7 In view of the nature of the business of the company being as per the specification of the customers, the quanititaive details are given to the extent available and are not of comparable items.

1.8 Segment Reporting

The company operates in only one segment. Hence, there are no other reportable segment as per AS - 17 issued by ICAI.

1.9 The company has two subsidiaries Readymade Steel Singapore Pte Ltd. and Readymade Steel Hongkong Ltd. The company has made long term investment in the equity of these companies. There are no material transaction in Readymade Steel Hongkong Ltd. however, there has been considerable business in Readymade Steel Singapore Pte Ltd. which has acquired KH Foges Pte Ltd., a leading foundation engineering company in Singapore. The company has invested significant amount in Readymade Steel Singapore Pte Ltd. as long term equity investments for these activities. During the year the company has also acquired the business of Kridhan Infra solutions (P) Ltd. for availing the benefits of operational synergy.

1.10 Contingent liabilities not provided for:

Amount in Rs. Lacs Corporate Guarantees issued to parties 17.43 (35.57) Income Tax Demand Recd 17.09 (amount deposited under protest Rs. 8.55 Lacs)

Income tax and VAT liabilities in respect of pending / ongoing assessments Not Ascertainable

1.11 Previous year figures have been regrouped, rearranged and reclassified wherever necessary to conform to current years presentation.

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Mar 31, 2013

1.1 Fixed Assets, Stocks and Cash balance were physically verifed by the management. The Certifcation of the same given by the managment has been relied upon by the auditors.

1.2 The current assets, loans and advances have the values at least equal to the amount at which they are stated in the Balance sheet on their realisation in ordinary course of business. Provisions for all known liabilities are adequate and not in excess of the amount reasonably necessary.

1.3 Balances of Current assets and current liabilities are subject to confrmation and consequential adjustment, if any.

1.4 In absence of none of the parties are registered as micro, small or medium as defned under the Micro Small & Medium Enterprise Development Act 2002, the relevant information has been considered as NIL. Hence, the required discloses under the MSMED Act are not given.

1.5 In view of the nature of the business of the company being as per the specifcation of the customers, the quanititaive details are given to the etxent available and are not of comparable items.

1.6 Segment Reporting

The company operates in only one segment. Hence, there are no other reportable segment as per AS - 17 issued by ICAI.

1.7 The company has accounted for liability on account of Employee retirement benefts on accrual basis but the same is not on actuarial basis as the amount of the same is not material. However, the actuarial valuation for the same shall be done in the coming year.

1.8 The company has two subsidiaries Readymade Steel Singapore Pte Ltd. and Readymade Steel Hongkong Ltd. The company has made long term investment in the equity of these companies. There are no material transaction in Readymade Steel Hongkong Ltd. however, there has been considerable business in Readymade Steel Singapore Pte Ltd. which has acquired KH Foges Pte Ltd., a leading foundation engineering company in Singapore. The company has invested signifcant amount in Readymade Steel Singapore Pte Ltd. as long term equity investments for these activities.

1.9 Contingent liabilities not provided for: Amount in Rs. Lacs

Corporate Guarantees issued to parties 35.57 (69.92)

Income tax and VAT liabilities in respect of pending / ongoing assessments Not Ascertainable

1.10 Long term borrowings include the instalments due and payable within one year amounting to Rs. 420 Lacs

1.11 Previous year fgures have been regrouped, rearranged and reclassifed wherever necessary to conform to current years presentation.

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Mar 31, 2012

A) Security Details

i) The Term Loan facility from Banks are along with interest are secured (incl additional security) by EM of Factory, Land and Building of the plant of the company at Khopoli having value of 395.00 Lacs

ii) Further secured by Personal Guarantee of Anil Agrawal and Smt. Krishna Devi Agarwal

b) Repayment Schedule

The term loans are repayable in 72 EMI commencing from April 2009

There is no supplier covered under the Micro, Small and Medium Enterprises Development Act, 2006 (the Act). This information and the information given above has been determined based on the details regarding the status of the suppliers obtained by the Company. This has been relied upon by the auditors.

1 Fixed Assets, Stocks and Cash balance were physically verified by the management. The Certification of the same given by the managment has been relied upon by the auditors.

2 The current assets, loans and advances have the values at least equal to the amount at which they are stated in the Balance sheet on their realisation in ordinary course of business. Provisions for all known liabilities are adequate and not in excess of the amount reasonably necessary.

3 Balances of Current assets and current liabilities are subject to confirmation and consequential adjustment, if any.

4 In absence of none of the parties are registered as micro, small or medium as defined under the Micro Small & Medium Enterprise Development Act 2002, the relevant information has been considered as NIL. Hence, the required discloses under the MSMED Act are not given.

5 In view of the nature of the business of the company being as per the specification of the customers, the quanititaive details are given to the etxent available and are not of comparable items.

6 The company has accounted for liability on account of Employee retirement benefits on accrual basis but the same is not on actuarial basis as the amount of the same is not material. However, the actuarial valuation for the same shall be done in the coming year.

7 During the year the revised Schedule VI of the companies Act, has become applicable. Pursuant to which the company has made the requisite discosure for the same in compliance thereof. Accordingly, the previous years figures have been regrouped for the purpose of comparison as also for compliance with the requirement of Revised Schedule VI.

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Mar 31, 2011

1) Contingent Liabilities not provided for; (Rs. In lacs)

Counter guarantees in respect of Bank Guarantees given to the parties 147.58

Corporate Guarnatees issued to parties 60.00

Income tax and sales tax liabilities in respect of pending assessments, remain unprovided. Not Ascertainable

2) Fixed Assets, Stocks and Cash balance have been physically verified by the management.

3) Current Assets, Loans and Advances have a values at least equal to the amount at which they are stated in the Balance sheet on their realisation in the ordinary course of business. Provisions for all known liabilities are adequate and not in excess of the amount reasonably necessary.

4) Balances of Current Assets and Current Liabilities are subject to confirmation and consequential adjustment, if any.

5) As of March 2011, the Company has not received any information as to the status as a Micro, Small & Medium Enterprises from any of the suppliers , with a copy of the Memorandum filed as per the Provision of section 8 of the Micro, Small & Medium Enteprises Development Act 2006.

6) The company had incurred a sum of Rs. 11,57,153 towards preliminary expenses and other legal expenses including stamp duty and fee for increase in the authorised capital, which are amortised over a period of ten years from the date the same are being incurred. The unamortised balance of Rs. 928,579 is being carried forward as on 31st March 2011. The company has incurred a sum of Rs 1,03,31,545 towards Public Issue Expenses.

7) In view of the nature of the business of the company being as per the specification of the customers, the quanititaive details are given to the etxent available and are not of comparable items.

8) SEGMENT REPORTING

The company operates in only one segment. Hence, there are no other reportable segment as per AS - 17 issued by the Institute of Chartered Accountants of India.

9) The company was accoutning for gratuity on cash basis. During the period the company has carried out an actuarial valuation and based upon the same provision for gratuity has been accounted for. The cumulative provision as on March 31, 2010 amounting to Rs. 1.20 lacs has been adjusted against the opening balance of reserves as per AS - 15 and the provision for the year ended March 31, 2011 amounting to Rs.1.13 lacs has been charged to expenses in the year.

Other Disclosures as required under AS - 15 are as under Defined Benefit Plan - Gratuity

10) During the period under audit the company has vested a scheme of Employee Stock Option under which 116000 shares are / will be offered to the employees over a period of five years at defined prices. The option is excersicable by the employee starting from the year 2011-12.

11) Figures have been rounded off to a nearest rupee. Previous year''s figures have been regrouped, reclassified and rearranged wherever necessary. Figures in the brackets are for the year ended March 31, 2010.