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Notes to Accounts of Minda Corporation Ltd.

Mar 31, 2023

Impairment testing of goodwill

For the purposes of impairment testing, goodwill is allocated to the Cash Generating Unit (CGU) which represents the lowest level at which the goodwill is monitored for internal management reporting purposes.

The recoverable amount of the cash generating unit was based on its value in use. The value in use of this unit was determined to be higher than the carrying amount and an analysis of the calculation''s sensitivity towards change in key assumptions did not identify any probable scenarios where the CGU recoverable amount would fall below their carry amount. Value in use was determined by discounting the future cash flows generated from the continuing use of the CGU. The calculation as at March 31,2023 and March 31,2022 was based on the following key assumptions:

i. The anticipated annual revenue growth and margin included in the cash flow projections are based on past experience, actual operating results and the 5-year business plan in all periods presented.

ii. The terminal growth rate ranges from 4% to 5% (Previous year: 4% to 5%) representing management view on the future long-term growth rate.

iii. Discount rate ranging from 13% to 15% (Previous year: 13% to 15%) for all periods presented was applied in determining the recoverable amount of the CGU. The discount rate was estimated based on past experience and companies weighted average cost of capital.

The values assigned to the key assumptions represent the management''s assessment of future trends in the industry and based on both internal and external sources.

Pursuant to the approval of the shareholders on March 23, 2014, the Company had allotted Bonus shares in the ratio of 1:1 and the nominal value of shares of the Company has been sub-divided from H 10 (Rupees Ten) per share to H 2 (Rupees Two) per share. Consequent to the same, the number of the equity shares of the Company has increased from 20,931,164 equity shares of H 10 each to 209,311,640 shares (including shares held by Minda Corporation limited - Employee Stock Option Scheme trust) of H 2 each.

2.17.4 Rights, preferences and restrictions attached to each class of shares

a) Equity shares of J 2 each (March 31, 2022: J 2 each) fully paid up

The Company has one class of equity shares having a par value of H 2 per share (March 31, 2022 : H 2 per share). Each shareholder is eligible for one vote per share held. The dividend proposed by the Board of Directors is subject to the approval of the shareholders in the ensuing Annual General Meeting, except in case of interim dividend. In the event of liquidation, the equity shareholders are eligible to receive the remaining assets of the Company after distribution of all preferential amounts, in proportion to their shareholding.

b) 0.001% cumulative redeemable preference shares of J 800 each fully paid up

The Company had 240,000 cumulative redeemable preference shares of H 800 each. The shares carry right of fixed preferential dividend at a rate of 0.001%. The holders of these shares do not have the right to vote and are compulsorily redeemable at par on or before the expiry of 20 years from the date of allotment. The dividend on the shares shall be cumulative and any unpaid dividend shall be added to the amount payable as dividend in the following year and no dividend can be paid on equity shares until the entire backlog of unpaid dividends on these shares is cleared. In the event of liquidation, these share holders are entitled to get their capital after satisfaction of dues for secured creditors, but they get preference over equity share capital. The shares have been redeemed during the year ended March 31,2018.

2.17.7 Issue of shares to Minda Corporation Limited Employees'' Stock Option Scheme

Pursuant to the Board of Director''s approval in Board meeting held on September 29, 2011, the Company has constituted a trust under the name ''''Minda Corporation Limited Employee Stock Option Scheme Trust'''' (MCL ESOS Trust), with the objective of acquiring and holding of shares, warrants or other securities of the Company for the purpose of implementing the Company''s ESOP Scheme. The Company has contributed a sum of H0.1 million towards initial trust fund and later on advanced a sum of H134 million to fund the purchase of Company''s equity shares by Minda Corporation limited - Employee stock option scheme trust. The Company had issued and allotted, 267,092 equity shares of the Face Value H 10 each at the premium of H 490 per equity share to the Minda Corporation limited - Employee stock option scheme trust, as approved in the Extra ordinary general meeting dated October 24, 2011. Further, the Company had issued bonus shares in proportion of one equity share for one share held on March 29, 2012, as decided in Extra ordinary general meeting held on March 16, 2012. During the financial year ended March 31,2017, the members of the Company had approved ''Employee Stock Option Scheme, 2017'' through Postal Ballot on February 10, 2017. The plan envisaged grant of stock options to eligible employees at an exercise price equal to the latest available closing price discounted by 50% or such other percentage as may be decided by the Nomination and Remuneration Committee. Refer note 2.41.

2.17.8 Qualified Institutional Placement (QIP) of equity shares

During the year ended March 31, 2019, the Company had raised funds amounting to H 3,056 million (net of expenses of H 50 million) by way of Qualified Institutional Placement (QIP) of equity shares for the objects of working capital requirement, repayment of outstanding loan, investment in subsidiaries and joint ventures, to fund growth and expansion and towards

During the previous year ended March 31, 2021, the Company had raised additional capital aggregating to H 824 million (net of expenses of H 6 million) by way of preferential allotment of equity shares. The Company had issued 11,857,143 shares at a price of H70/- per share whereby equity share capital has increased by H 24 million and securities premium account is increased by H 800 million (net of expenses of H 6 million).

â¢ Securities premium

Securities premium is used to record the premium on issue of shares. The reserve can be utilised only for limited purposes such as issuance of bonus shares in accordance with the provisions of the Companies Act, 2013.

â¢ Capital redemption reserve

This represents the unutilised accumulated amount set aside at the time of redemption of preference share. This reserve is utilised in accordance with the provisions of the Companies Act, 2013.

â¢ General reserve

Under the erstwhile Companies Act 1956, general reserve was created through an annual transfer of net income at a specified percentage in accordance with applicable regulations. The purpose of these transfers was to ensure that if a dividend distribution in a given year is more than 10% of the paid-up capital of the Company for that year, then the total dividend distribution is less than the total distributable results for that year. Consequent to introduction of Companies Act 2013, the requirement to mandatorily transfer a specified percentage of the net profit to general reserve has been withdrawn. However, the amount previously transferred to the general reserve can be utilised only in accordance with the specific requirements of Companies Act, 2013.

â¢ Employee stock compensation option outstanding

The fair value of the equity settled share based payment transactions with employees is recognised in Statement of Profit and Loss with corresponding credit to ESOP outstanding. Further, equity settled share based payment transaction with employees of subsidiary is recognised in investment of subsidiaries with corresponding credit to ESOP outstanding. Corresponding balance of a ESOP outstanding is transferred to general reserve upon expiry of grants or upon exercise of stock options by an employee, as the Company is operating the Employee Stock Option scheme (refer note 2.41).

â¢ Remeasurements of defined benefit obligation, net

Remeasurements of defined benefit obligation comprises actuarial gains and losses and return on plan assets.

â¢ Equity component of compound financial instrument - Cumulative redeemable preference share

The Company had issued compulsory redeemable preference shares @0.001% (below market rate). The same were recorded at cost under previous GAAP. The Company has redeemed such preference shares during the current year. Under Ind AS, the preference shares is treated as compound financial instruments and accordingly, classified as financial liability and equity. The same is recognised at amortized cost and is discounted using market rate. The differential between Fair Value and Book Value is considered as equity portion of compound financial instrument.

â¢ Capital Reserve on amalgamation

Accumulated capital surplus not available for distribution of dividend.

â¢ Retained Earnings

Represents surplus/(deficit) in statement of Profit and Loss during the year, including retained earnings of Transferor Companies/Demerged Company on account of merger.

â¢ Equity instruments through Other Comprehensive Income

The Company has elected to recognise changes in the fair value of certain investments in equity securities in other comprehensive income. These changes are accumulated within the Equity instruments through Other Comprehensive Income within equity. The Company transfers amounts from this reserve to retained earnings when the relevant equity securities are derecognised.

b) Defined benefit plans - Gratuity

In accordance with the Payment of Gratuity Act, 1972, the Company provides for gratuity as a defined benefit plan. The gratuity plan provides for a lump sum payment to the employees at the time of separation from the service on completion of vested period of employment i.e. five years or part thereof in excess of six months. The liability of gratuity plan is provided based on actuarial valuation as at the end of each financial year based on which the Company contributes the ascertained liability to Life Insurance Corporation of India by whom the plan assets are maintained.

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

The discount rate is estimated based on the prevailing market yields of Indian Government securities as at the balance sheet date for the estimated term of the obligation.

The weighted average duration of the defined benefit obligation is years 10.25 years (March 31, 2022: 10.32 years). The Company expects to make a contribution of H87 million (March 31, 2022: H 74 million) to the defined benefit plans during the next financial year.

c) Other benefit - Compensated absences

The Company operates compensated absences plan, where in every employee is entitled to the benefit as per the policy of the Company in this regard. The salary for calculation of earned leave is last drawn salary. The same is payable during the service, early retirement, withdrawal of scheme, resignation by employee and upon death of employee.

The other long- term benefit of compensated absence in respect of employees of the Company as at March 31, 2023 amounts to H163 million (March 31, 2022: H 150 million) and the expense recognised in the statement of profit and loss during the year for the same amounts to H 57 million (March 31,2022: H 63 million) [Gross payment of H 42 million (March 31,2022: H34 million)].

2.38 Capital and other commitments

Capital Commitments: Estimated amount of contracts remaining to be executed on capital account and not provided for (net of advances): H445 million (March 31,2022: H255 million)

2.39A (1) Contingent liabilities
Particulars	As at March 31, 2023	As at March 31, 2022
Claims against the Company not acknowledged as debts*
a) Income-tax ^A {Amount paid under protest H 10 million (previous year: H 10 million)}	244	244
b) Sales tax/ VAT {Amount paid under protest H 3 million (previous year: H 3 million)}	59	50
c) Excise duty / Service tax / Custom duty {Amount paid under protest H 2 million (previous year: H 2 million)}	2	6

including claims in respect of transferor companies merged into Minda Corporation Limited, pursuant to scheme of merger, though the litigations may be continuing in the name of transferor companies, however any liability arising in future relating to these disputes will be borne by the Company.

Further on account of merger of Companies as mentioned in Corporate information under Note 1 to the financial statement, Minda Corporation Limited had filed one single return for Assessment year 2019-2020 relevant to financial year 2018-19 onwards and the prepaid/ advance taxes which were seen in Merged Companies have been considered by the Company in Income Tax Return. At the time of processing of income tax return by the authorities, income tax payable had been assessed without giving the credit of prepaid/ advance taxes paid by those merged entities and accordingly demand amounting to H 381 million had been raised. In a similar manner for Assessment Year 2020-21 demand of H 42 million had been raised by the authorities. With respect to both the assessment years the Company had filed rectification to Assessing Officer to allow the credit of prepaid/ advances taxes by the merged companies to the companies and management is hopeful for such adjustments and accordingly the same has not been disclosed under this note

In relation to income tax matters disclosed in (a) above, majorly includes

1. With respect to assessment year 2012-2013 till assessment year 2018-2019, the income tax authorities have increased the taxable income of the Company by H 479 million (March 31, 2022: H 479 million) on account of transfer pricing adjustments pertaining to disallowance of deduction claimed under section 80IC of Income Tax Act, 1961 and other adjustments. Tax impact of the same is H209 million (March 31, 2022: H 209 million) against which Company had deposit amounting to H 10 million (March 31, 2022: H 10 million. The Company has preferred an appeal with Commissioner of Income Tax (Appeals) and based on the discussion with the legal counsel is confident of favourable outcome. Further, during the current year, the department has also adjusted refund amounting to H 149 million (including interest) pertaining to assessment year 2020-2021 against the outstanding demand.

In relation to Sales tax/ VAT /GST disclosed in (b) above, majorly includes

1. In the previous year, matter pending with Deputy Commissioner of State Tax, Pune pertaining to financial year

2016- 2017 for disallowance of input tax credit. The tax amount involved H 3 million against which Company had deposit amounting to H 1 million. During the current year, the Company has filed an application under Maharashtra Amnesty Scheme, 2022 for resolution of the matter and has accepted and paid demand raised by the department. Accordingly, the amount of demand involved in the case for the current year is H Nil (March 31, 2022: H 3 million) and the case has been closed.

2. In the previous year, matter pending with Deputy Commissioner of State Tax, Pune pertaining to financial year

2017- 2018 for disallowance of input tax credit. The tax amount involved H 1 million. During the current year, the Company has filed an application under Maharashtra Amnesty Scheme, 2022 for resolution of the matter and has accepted and paid demand raised by the department. Accordingly, the amount of demand involved in the case for the current year is H Nil (March 31,2022: H 1 million) and the case has been closed.

3. In the previous year, matter pending with Joint Commissioner of State Tax, Pune pertaining to financial year 2017-2018 demand raised for non -submission of Statutory Form C. During the current year, an Order-in-Appeal has been passed by Joint Commissioner of State Tax whereby the whole demand has been disposed off by the Commissioner. Accordingly, the amount of demand involved in the case for the current year is Nil (March 31, 2022: H 18 million) and the case has been closed.

4. Matter pending with Joint Excise & Taxation Commissioner (Appeals) pertaining to financial year 2017-2018 for disallowance of input tax credit. The Company has done an analysis and is of the opinion that it has a fair chance of favourable decision. The tax amount involved H 14 million (March 31,2022: H 14 million).

5. Matter pending with Deputy Commissioner of State Tax, Bhiwandi pertaining to financial year 2017-2018 for GST Demand on account of difference in GST3B and GSTR1 and disallowance of Input Tax Credit. The Company has done an analysis and is of the opinion that it has a fair chance of favourable decision. The tax amount involved H 10 million (March 31,2022: H 10 million).

6. Matter pending with Deputy Commissioner of State Tax, Bhiwandi pertaining to financial year 2018-2019 for GST Demand on account of disallowance of excess Input Tax Credit availed. The Company has done an analysis and is of the opinion that it has a fair chance of favourable decision. The tax amount involved H 32 million (March 31,2022: Nil).

In relation to Excise Duty/Service Tax/ Custom duty disclosed in (c) above, majorly includes

1. Demand created on account of Show Cause Notice which was issued by the Directorate General of GST Intelligence (DGGI) under Central Excise Act, 1944 (CEA) on MCL and MSL for the period 2013-14 to 2017-18 (till June). Allegations made in the SCN is that assessee is engaged in manufacturing of equipment for principal manufacturer, which is, Maruti Suzuki India Limited (MSIL). To get the manufacturing done as per its specification, MSIL also provided drawing/designs to MCL and MSL, free of cost. While computing the value of excisable goods manufactured by MCL and MSL, the Company did not factor the cost of drawing/designs. Hence, allegations have been made that value of drawing/designs should have been added while determining taxable value for computing Excise Duty payable. During the current year, the adjudicating authority has held that the demand pertaining to the period April 2013 to February 2024 is time barred and accordingly the demand has been reduced to H 0.02 million (March 31, 2022: H 4 million). For the balance demand, the Company is in the process of filing an appeal before the relevant authority and believes that its position will likely be upheld and accordingly, no provision is necessary at this stage.

2.39A (2) Pursuant to judgement by the Hon''ble Supreme Court dated February 28, 2019, it was held that basic wages for the purpose of provident fund, to include special allowances which are common for all employees. However there is uncertainty with respect to the applicable of the judgement and period from which the same applies and accordingly, the Company has not estimated the impact of the same till March 2019.

Owing to the aforesaid uncertainty and pending clarification from the authority in this regard, the Company has not recognised any provision till March 2019. Further management also believes that the impact of the same on the Company will not be material.

2.39B During the earlier years, one party raised a damage claim against the Company by filing a request with International Chamber of Commerce in Paris. The claim is based on Letter of Comfort ("LOC") signed between party and the Company. At the time of entering into the above mentioned LOC, the Company also obtained indemnity letter from ultimate parent of party, indemnifying the Company against any loss arising from the LOC. Based on legal opinion and the indemnification from ultimate parent of party, the management is of the view that there is no financial implication on the Company in respect of this damage claim. Subsequently, the parties have entered into settlement agreement, pursuant to which, a Consent Award has been passed by International Chamber of Commerce, vide which the Company is required to pay H 492 million {(March 31, 2022 H 463 million) (Euro 5.5 million)}. As per Ind AS 37, the Company has accounted for payable against settlement amount under ""other financial liabilities"" and correspondingly recognised receivable under ""other financial assets".

During the current year, in order to discharge its obligation under the said agreement, the Company requested requisite documents for making the foreign remittance which were awaited from the party.

Subsequent to the year end, the party has filed petition before the Hon''ble High Court of Delhi for the payment of settlement amount which is sub-judice at the moment. However management is of the view that no adjustments are required in the financial statements at the moment and loss if any, has already been provided for in the books of accounts.

2.41 Employee Share-Based Payment Plans

The members of the Company had approved ''Employee Stock Option Scheme, 2017'' through Postal Ballot on February 10, 2017. The plan envisaged grant of stock options to eligible employees at an exercise price equal to the latest available closing price discounted by 50% or such other percentage as may be decided by the Nomination and Remuneration Committee.

Under the Plan, upto 5,341,840 stock options can be issued to eligible employees of the Company and its subsidiaries, whether working in India or out of India, including any Director of the Company and its subsidiaries, whether whole time or otherwise excluding the Independent Directors. Under the Plan, each option, upon vesting, shall entitle the holder to acquire one equity share of H 2 each. The options granted will vest gradually over a period not earlier than one year and not later than five years from the date of Grant of such Options. Vesting of Options is a function of achievement of performance criteria or any other criteria, as specified by the Committee and communicated in the grant letter.

The options outstanding as at March 31, 2023 have a weighted average remaining contractual life of 2.40 years (March 31, 2022: 2.84 years).

The amount recognised as an expense in statement of profit and loss account for employee services received amounting to H28 million (March 31, 2022 H21 million) and ESOP expense recoverable from one of the subsidiary of H 3 million. Further, there were no cancellations or modifications to the scheme in year ending March 31,2023 or March 31,2022.

2.43 Leases

Company as a Lessee

The Company recorded the lease liability at the present value of the remaining lease payments discounted at the incremental borrowing rate and has measured right-of-use asset at an amount equal to lease liability.

Most of the leases entered by the Company are long term in nature and the underlying leased properties are being used as manufacturing plants. The Company doesn''t foresee any major changes in lease terms or the leases in the foreseeable future as per current business projections after considering the impact of COVID-19.

2.44 The Company has established a comprehensive system of maintenance of information and documents as required by the transfer pricing legislation under section 92-92F of the Income Tax Act, 1961. Since the law requires existence of such information and documentation to be contemporaneous in nature, the Company is in the process of updating the documentation for the transactions entered into with the associated enterprises during the financial year and expects such records to be in existence latest by due date as required under the law. The management is of the opinion that its transactions with the associated enterprises are at arm''s length so that the aforesaid legislation will not have any impact on the financial statements, particularly on the amount of tax expense and that of provision for taxation.

2.45 As per Ind-AS 108, Operating segments have been defined based on the regular review by the Company''s Chief Operating Decision Maker to assess the performance of each segment and to make decision about allocation of resources. The Company''s business activities fall within single primary business segment, viz, manufacturing of Automobile Components and Parts thereof. Accordingly, disclosures under Ind AS 108, Operating Segments are not required to be made.

2.46 The Company has a process whereby periodically all long term contracts are assessed for material foreseeable losses. At the year end, the Company has reviewed and noted that there are no long term contracts. Accordingly, no provision is required to be created in the books of account under any law / accounting standards.

2.47 The Company, in earlier years, had made impairment provision amounting to H 2,622 million (regarding Investment, Loan and other recoverable) in the books of accounts, with respect to its exposure related to recovery of said balances in erstwhile wholly owned subsidiary Minda KTSN Plastic Solutions Gmbh & Co. KG, Germany (KTSN, Germany). The Company was unsure of the statutory provisions regarding write off under various rules and Act. The Company has re-assessed the applicability of write off and has written off the same in view of recent updated FEMA Guidelines in the current financial year. The said write off is based on the progress report of insolvency proceedings and communication received from the insolvency administrator of KTSN, Germany as there is no probability of Company receiving any claim out of the insolvency proceedings.

Further, the Company based on its own assessment, and opinions obtained from independent experts has considered that such write off shall be admissible as a tax allowance and shall be claimed in its return of income for the year ended March 31, 2023. Accordingly, the Company has considered tax impact of above write off and accordingly income tax provision amounting to H 487 million has been reversed in the current year

2.48 (a) During the year ended March 31, 2023, the Company, after due approval of Board, had purchased 191,40,340

equity shares of Pricol representing 15.7% of the total paid up equity share capital (as at December 31, 2022) of Pricol Ltd. aggregating amounting to H 4,057 million from the open market. The investment is in nature of financial investment, and the Company has not acquired any special rights in Pricol Limited. As per IND AS-109 "Financial Instruments", any gains or losses arising on subsequent recognition at the time of reporting period end will be accounted directly through Other Comprehensive Income (OCI) and accordingly loss amounting to H 90 million has been recognised in the financial statements.

(b) In case of an associate company "Furukawa Minda Electric Private Limited", since it has incurred consistent losses in past years due to which the net worth has been fully eroded as at March 31,2023. However, in view of initiatives by the management of the associate company to improve its operations, profitability and continued support from Parent Company of the associate company, its financial statements for the year ended March 31, 2023 have been prepared on going concern basis. Further, the Company has done impairment testing as at March 31,2023 on the basis of Discounted cash flows. Based on the above assessment by the management, an impairment loss amounting to H 250 million has been provided in the books and shown the same as exceptional items.

The management assessed that the fair values of the quoted invesments are based on price quotations at the reporting date. The fair values of current financial assets and liabilities significantly approximate their carrying amounts largely due to the current maturities of these instruments. Accordingly, management has not disclosed fair values for financial instruments such as trade receivables, trade payables, cash and cash equivalents, other current assets, interest accrued on fixed deposits, other current liabilities etc.

The fair value of non-current financial assets and financial liabilities are determined by discounting future cash flows using current rates of instruments with similar terms and credit risk. The current rates used do not reflect significant changes from the discount rates used initially. Therefore, the carrying value of these instruments measured at amortised cost approximate their fair value.

There have been no transfers between Level 1, Level 2 and Level 3 for the years ended March 31, 2023 and March 31,2022.

Valuation technique used to determine fair value

Specific valuation techniques used to value non current financial assets and liabilities for whom the fair values have been determined based on present values and the appropriate discount rates of the Company at each balance sheet date. The discount rate is based on the weighted average cost of borrowings of the Company at each balance sheet date.

Valuation processes

The Company has an established control framework with respect to the measurements of the fair values. This includes a valuation team that has overall responsibility for overseeing all significant fair value measurements and reports to Senior Management. The valuation team regularly reviews significant unobservable inputs and valuation adjustments.

b. Financial risk management

The Company has exposure to the following risks arising from financial instruments:

- Credit risk ;

- Liquidity risk ; and

- Market risk - Foreign exchange

- Market risk - Interest rate Risk management framework

The Company''s board of directors has overall responsibility for the establishment and oversight of the Company''s risk management framework. The board of directors have authorised senior management to establish the processes, who ensures that executive management controls risks through the mechanism of properly defined framework.

The Company''s risk management policies are established to identify and analyse the risks faced by the Company, to set appropriate risks limits and controls, to monitor risks and adherence to limits. Risk management policies are reviewed regularly to reflect changes in market conditions and the Company''s activities. The Company, through its training and management standards and procedures, aims to maintain a disciplined and constructive control environment in which all employees understand their roles and obligations.

The Company uses derivative financial instruments exclusively for hedging financial risks that arise from its foreign exchange related exposures.

The Company manages its credit risk through credit approvals, establishing credit limits and continuously monitoring credit worthiness of customers to which the Company grants credit terms in the normal course of business.

(iii) Valuation technique used to determine fair value

The Company has used discounted cash flow method (income approach) for equity instrument and compulsorily convertible debentures.

Credit risk is the risk of financial loss to the Company if a customer or counterparty to a financial instrument fails to meet its contractual obligations, and arises principally from the Company''s receivables from customers, loans.

Credit risk on cash and cash equivalents is limited as the Company generally invests in deposits with banks with high credit ratings assigned by domestic credit rating agencies. Credit risk on investments is limited as the Company generally invests in entities after reviewing the liquidity position of the entities.

As per Ind AS 109, the Company uses expected credit loss (ECL) model to assess the impairment loss or gain. The Company uses a provision matrix to compute the expected credit loss allowance for trade receivables and unbilled revenues. The provision matrix takes into account available external and internal credit risk factors such as Company''s historical experience for customers.

Liquidity risk is the risk that the Company will encounter difficulty in meeting the obligations associated with its financial liabilities that are settled by delivering cash or another financial asset. The Company''s approach to managing liquidity is to ensure, as far as possible, that it will have sufficient liquidity to meet its liabilities when they are fallen due, under both normal and stressed conditions, without incurring unacceptable losses or risking damage to the Company''s reputation.

The Company believes that its liquidity position, including total cash and cash equivalent and bank balances other than cash and cash equivalent of H2,164 million as at March 31, 2023 (March 31, 2022 H2,164 million), anticipated future internally generated funds from operations, and its fully available, revolving undrawn credit facility will enable it to meet its future known obligations in the ordinary course of business. However, if a liquidity needs were to arise, the Company believes it has access to financing arrangements, value of unencumbered assets, which should enable it to meet its ongoing capital, operating, and other liquidity requirements. The Company will continue to consider various borrowing or leasing options to maximize liquidity and supplement cash requirements as necessary.

The Company''s liquidity management process as monitored by management, includes the following:

- Day to day funding, managed by monitoring future cash flows to ensure that requirements can be met.

- Maintaining rolling forecasts of the Company''s liquidity position on the basis of expected cash flows.

- Maintaining diversified credit lines.

I. Financing arrangements

The Company had access to the following undrawn borrowing facilities at the end of the reporting period:

Market risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market prices. Market risk comprises two types of risk: currency risk and interest rate risk. The objective of market risk management is to manage and control market risk exposures within acceptable parameters, while optimising the return.

Currency risk

Currency risk is the risk that the future cash flows of a financial instrument will fluctuate because of changes in foreign exchange rates. The Company is exposed to the effects of fluctuation in the prevailing foreign currency exchange rates on its financial position and cash flows. Exposure arises primarily due to exchange rate fluctuations between the functional currency and other currencies from the Company''s operating, investing and financing activities.

Sensitivity analysis

A reasonably possible strengthening (weakening) of the Indian Rupee against below currencies at March 31, 2023 (previous year ended as on March 31, 2022) would have affected the measurement of financial instruments denominated in foreign currency and affected equity and profit or loss by the amounts shown below. This analysis is performed on foreign currency denominated monetary financial assets and financial liabilities outstanding as at the year end. This analysis assumes that all other variables, in particular interest rates, remain constant and ignores any impact of forecast sales and purchases.

Interest rate risk

Interest rate risk is the risk that the future cash flows of a financial instrument will fluctuate because of changes in market interest rates. The Company''s main interest rate risk arises from long-term borrowings with variable rates, which expose the Company to cash flow interest rate risk.

2.50 Capital management

For the purpose of the Company''s capital management, capital includes issued equity share capital, share premium and all other equity reserves attributable to the equity holders of the parent. The primary objective of the management of the Company''s capital structure is to maintain an efficient mix of debt and equity in order to achieve a low cost of capital, while taking into account the desirability of retaining financial flexibility to pursue business opportunities and adequate access to liquidity to mitigate the effect of unforeseen events on cash flows.

The Company manages its capital structure and makes adjustments to it in light of changes in economic conditions. To maintain or adjust the capital structure, the Company may return capital to shareholders, raise new debt or issue new shares.

The Company monitors capital on the basis of the debt to capital ratio, which is calculated as interest-bearing debts divided by total capital (equity attributable to owners of the parent plus interest-bearing debts).

2.52 Other statutory information

1. The Company do not have any Benami property, where any proceeding has been initiated or pending against the Company for holding any Benami property.

2. The Company do not have any charges or satisfaction which is yet to be registered with ROC beyond the statutory period,

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

4. The Company has not advanced or loaned or invested funds to any other person(s) or entity(ies), including foreign entities (Intermediaries) with the understanding that the Intermediary shall:

(a) directly or indirectly lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the company (Ultimate Beneficiaries) or

(b) provide any guarantee, security or the like to or on behalf of the Ultimate Beneficiaries

5. The Company has not received any fund from any person(s) or entity(ies), including foreign entities (Funding Party) with the understanding (whether recorded in writing or otherwise) that the Company shall:

(a) directly or indirectly lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the Funding Party (Ultimate Beneficiaries) or

(b) provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries,

6. The Company does not have any such transaction which is not recorded in the books of accounts that has been surrendered or disclosed as income during the year in the tax assessments under the Income Tax Act, 1961 (such as, search or survey or any other relevant provisions of the Income Tax Act, 1961

7. The Company has done transactions with companies struck off under section 248 of the Companies Act, 2013 or section 560 of Companies Act, 1956, and the outstanding balances as on the balance sheet date is as below:-

2.53 Quarterly returns submitted with the bank

The quarterly returns or statements filed by the Company for working capital limits with banks and financial institutions are not in agreement with the books of account of the Company and details of the difference were noted between the amount as per books for respective quarters and amount as reported in the quarterly statements is as follows:

The differences were in case of Debtors amounting to H (71) million (amount reported H 5,186 million vs amount per books of account H 5,257 million), H (4) million (amount reported H 5,483 million vs amount per books of account H 5,487 million), H (36) million (amount reported H 4,921 million vs amount per books of account H 4,957 million) for the quarter ended June 30, 2022, September 30, 2022 and December 31, 2022 respectively.

In the previous year the differences were in case of Debtors amounting to H 917 million (amount reported H 4,424 million vs amount per books of account H 3507 million), H 472 million (amount reported H 4245 million vs amount per books of account H 3774 million), H 250 million (amount reported H 4131 million vs amount per books of account H 3881 million), 577 million (amount reported H 5083 million vs amount per books of account H 4506 million) for the quarter ended June 30, 2021, September 30, 2021, December 31,2021 and March 31,2022 respectively.

Further, Creditors had a difference of H 17 million (amount reported H 700 million vs amount per books of account H 718 million), H (71) million (amount reported H 672 million vs amount per books of account H 601 million), H 125 million (amount reported H 846 million vs amount per books of account H 971 million) for the quarter ended June 30, 2022, September 30, 2022 and December 31,2022; and

In the previous year, Creditors had a difference of H 1317 million (amount reported H 2714 million vs amount per books of account H 4031 million), H 1440 million (amount reported H 2964 million vs amount per books of account H 4405 million), H 1279 million (amount reported H 2768 million vs amount per books of account H 4047 million), 1745 million (amount reported H 2659 million vs amount per books of account H 4404 million) for the quarter ended June 30, 2021, September 30, 2021, December 31,2021 and March 31,2022 respectively.; and

Further, Inventory had no difference in amount reported and amount as per books of account, In Inventory, no difference (amount reported H 3960 million vs amount per books of account H 3960 million), no difference (amount reported H 4221 million vs amount per books of account H 4221 million), no difference (amount reported H 4116 million vs amount per books of account H 4116 million) for the quarter ended June 30, 2022, September 30, 2022 and December 31, 2022; and

In previous year, Inventory had a difference of H 217 million (amount reported H 4124 million vs amount per books of account H 3908 million), H 243 million (amount reported H 3996 million vs amount per books of account H 3753 million), H 175 million (amount reported H 4156 million vs amount per books of account H 3981 million) 98 million (amount reported H 3849 million vs amount per books of account H 3751 million) for the quarter ended June 30, 2021, September 30, 2021, December 31,2021 and March 31,2022 respectively.

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

2.55 The Company evaluates events and transactions that occur subsequent to the Balance sheet date but prior to the approval of the financial statements to determine the necessity for recognition and/or reporting of any of these events and transactions in financial statements. There were no subsequent events to be recognised or reported that are not already disclosed elsewhere in these financial statements.

2.56 Figures for the corresponding previous year have been regrouped/ reclassified, wherever considered necessary including requirements of the amended Schedule III to the Companies Act 2013, to make them comparable with current year classification.

Mar 31, 2022

2.16.4 Rights, preferences and restrictions attached to each class of shares

a) Equity shares of Rs. 2 each (31 March 2021: Rs. 2 each) fully paid up

The Company has one class of equity shares having a par value of Rs. 2 per share (31 March 2021 : Rs. 2 per share). Each shareholder is eligible for one vote per share held. The dividend proposed by the Board of Directors is subject to the approval of the shareholders in the ensuing Annual General Meeting, except in case of interim dividend. In the event of liquidation, the equity shareholders are eligible to receive the remaining assets of the Company after distribution of all preferential amounts, in proportion to their shareholding.

b) 0.001% cumulative redeemable preference shares of Rs. 800 each fully paid up

The Company had 240,000 cumulative redeemable preference shares of Rs. 800 each. The shares carry right of fixed preferential dividend at a rate of 0.001%. The holders of these shares do not have the right to vote and are compulsorily redeemable at par on or before the expiry of 20 years from the date of allotment. The dividend on the shares shall be cumulative and any unpaid dividend shall be added to the amount payable as dividend in the following year and no dividend can be paid on equity shares until the entire backlog of unpaid dividends on these shares is cleared. In the event of liquidation, these share holders are entitled to get their capital after satisfaction of dues for secured creditors, but they get preference over equity share capital. The shares have been redeemed during the year ended 31 March 2018.

2.16.5 Details of shareholders holding more than 5% shares as at year end

2.16.7 Issue of shares to Minda Corporation Limited Employees'' Stock Option Scheme

Pursuant to the Board of Director''s approval in Board meeting held on 29 September 2011, the Company has constituted a trust under the name ''''Minda Corporation Limited Employee Stock Option Scheme Trust'''' (MCL ESOS Trust), with the objective of acquiring and holding of shares, warrants or other securities of the Company for the purpose of implementing the Company''s ESOP Scheme. The Company has contributed a sum of Rs.0.1 million towards initial trust fund and later on advanced a sum of Rs.134 million to fund the purchase of Company''s equity shares by Minda Corporation limited - Employee stock option scheme trust. The Company had issued and allotted, 267,092 equity shares of the Face Value Rs. 10 each at the premium of Rs. 490 per equity share to the Minda Corporation limited - Employee stock option scheme trust, as approved in the Extra ordinary general meeting dated 24 October 2011. Further, the Company had issued bonus shares in proportion of one equity share for one share held on 29 March 2012, as decided in Extra ordinary general meeting held on 16 March 2012. During the financial year ended 31 March 2017, the members of the Company had approved ''Employee Stock Option Scheme, 2017'' through Postal Ballot on 10 February 2017. The plan envisaged grant of stock options to eligible employees at an exercise price equal to the latest available closing price discounted by 50% or such other percentage as may be decided by the Nomination and Remuneration Committee. Refer note 2.41.

2.16.8 Qualified Institutional Placement (QIP) of equity shares

During the year ended 31 March 2019, the Company has raised funds amounting to Rs. 3,056 million (net of expenses of Rs. 50 million) by way of Qualified Institutional Placement (QIP) of equity shares for the objects of working capital requirement, repayment of outstanding loan, investment in subsidiaries and joint ventures, to fund growth and expansion and towards corporate general purpose. The Company has issued 17,910,645 shares at a price of Rs. 173.47 per share whereby equity share capital has increased by Rs. 36 million and securities premium is increased by Rs. 3,020 million (net of expenses).

2.16.9 Preferential allotment of equity shares

During the previous year ended 31 March 2021, the Company has raised additional capital aggregating to Rs. 824 million (net of expenses of Rs. 6 million) by way of preferential allotment of equity shares. The Company has issued 11,857,143 shares at a price of Rs.70/- per share whereby equity share capital has increased by Rs. 24 million and securities premium account is increased by Rs. 800 million (net of expenses of Rs. 6 million).

2.17.9 Nature and purpose of other equity

â¢ Securities premium

â¢ Capital redemption reserve

This represents the unutilised accumulated amount set aside at the time of redemption of preference share. This reserve is utilised in accordance with the provisions of the Companies Act, 2013.

â¢ General reserve

â¢ Employee stock compensation option outstanding

â¢ Remeasurements of defined benefit obligation, net

Remeasurements of defined benefit obligation comprises actuarial gains and losses and return on plan assets.

â¢ Equity component of compound financial instrument - Cumulative redeemable preference share

â¢ Capital Reserve on amalgamation

Accumulated capital surplus not available for distribution of dividend.

â¢ Retained Earnings

Represents surplus/(deficit) in statement of Profit and Loss during the year, including retained earnings of Transferor Companies/ Demerged Company on account of merger.

The discount rate is estimated based on the prevailing market yields of Indian Government securities as at the balance sheet date for the estimated term of the obligation.

The weighted average duration of the defined benefit obligation is years 10.32 years (previous year: 10.33 years). The Company expects to make a contribution of Rs.74 million (previous year: Rs. 64 million) to the defined benefit plans during the next financial year.

c) Other benefit - Compensated absences

The other long- term benefit of compensated absence in respect of employees of the Company as at 31 March 2022 amounts to Rs.150 million (previous year Rs. 120 million) and the expense recognised in the statement of profit and loss during the year for the same amounts to Rs. 63 million (31 March 2021: Rs. 20 million) [Gross payment of Rs. 34 million (31 March 2021: Rs..22 million)].

Contract assets relates to revenue earned by the Company on account of rate difference agreed with the customer. Amount billed during the year Rs. 144 million (31 March 2021: Nil) and the closing balance represents amount to be billed at the year end.

Contract liabilities relates to amount received from customers as an advance against future sale. Performance obligation satisfied from the amount included in contract liabilities during the current year Rs. 165 million (31 March 2021: Rs. 99 million). Advance amount received during the year is Rs. 96 million (31 March 2021: 165 million) is outstanding at the year end.

âIncluding claims in respect of transferor companies merged into Minda Corporation Limited, pursuant to scheme of merger, though the litigations may be continuing in the name of transferor companies, however any liability arising in future relating to these disputes will be borne by the Company.

Further on account of merger of Companies as mentioned in Corporate information under Note 1 to the financial statement, Minda Corporation Limited has filed one single return for Assessment year 2019-2020 relevant to financial year 2018-19 onwards and the prepaid/ advance taxes which were seen in Merged Companies have been considered by the Company in Income Tax Return. At the time of processing of income tax return by the authorities, income tax payable has been assessed without giving the credit of prepaid/ advance taxes paid by those merged entities and accordingly demand amounting to Rs. 381 million has been raised. In a similar manner for Assessment Year 2020-21 demand of Rs. 42 million has been raised by the authorities. With respect to both the assessment years the Company had filed rectification to Assessing Officer to allow the credit of prepaid/ advances taxes by the merged companies to the companies and management is hopeful for such adjustments and accordingly the same has not been disclosed under this note.

In relation to income tax matters disclosed in (a) above, majorly includes

1. With respect to assessment year 2012-2013 till assessment year 2018-2019, the income tax authorities have increased the taxable income of the Company by Rs 479 million (31 March 2021: Rs Nil) on account of transfer pricing adjustments pertaining to disallowance of deduction claimed under section 80IC of Income Tax Act, 1961 and other adjustments. Tax impact of the same is Rs 209 million (31 March 2021: Rs Nil) against which Company had deposit amounting to Rs 10 million (31 March 2021: Rs Nil). The Company has preferred an appeal with Commissioner of Income Tax( Appeals) and based on the discussion with the legal counsel is confident of favourable outcome.

In relation to Sales tax/ VAT /GST disclosed in (b) above, majorly includes

1. Matter pending with Deputy Commissioner of State Tax, Pune pertaining to financial year 2016-2017 for disallowance of input tax credit. The Company has done an analysis and is of the opinion that it has a fair chance of favourable decision. The tax amount involved Rs 3 million (31 March 2021: Rs 9 million) against which Company had deposit amounting to Rs 1 million (31 March 2021: Rs 1 million).

2. Matter pending with Deputy Commissioner of State Tax, Pune pertaining to financial year 2017-2018 for disallowance of input tax credit. The Company has done an analysis and is of the opinion that it has a fair chance of favourable decision. The tax amount involved Rs 1 million (31 March 2021: Rs 6 million) against which Company had deposit amounting to Rs Nil (31 March 2021: Nil).

3. Matter pending with Joint Commissioner of State Tax , Pune pertaining to financial year 2017-2018 demand raised for non -submission of Statutory Form C. The Company has done an analysis and is of the opinion that it has a fair chance of favourable decision. The tax amount involved Rs 18 million (31 March 2021: Rs 31 million) against which Company had deposit amounting to Rs Nil (31 March 2021: Rs Nil).

4. Matter pending with Joint Excise & Taxation Commissioned Appeals) pertaining to financial year 2017-2018 for disallowance of input tax credit. The Company has done an analysis and is of the opinion that it has a fair chance of favourable decision. The tax amount involved Rs 14 million (31 March 2021: Rs 14 million)

In relation to Excise Duty/Service Tax/ Custom duty disclosed in (c) above, majorly includes

1. Demand created on account of Show Cause Notice which was issued by the Directorate General of GST Intelligence (DGGI) under Central Excise Act, 1944 (CEA) on MCL and MSL for the period 2013-14 to 2017-18 (till June). Allegations made in the SCN is that assessee is engaged in manufacturing of equipment for principal manufacturer, which is, Maruti Suzuki India Limited (MSIL). To get the manufacturing done as per its specification, MSIL also provided drawing/designs to MCL and MSL, free of cost. While computing the value of excisable goods manufactured by MCL and MSL, company did not factor the cost of drawing/designs. Hence, allegations have been made that value of drawing/designs should have been added while determining taxable value for computing Excise Duty payable. The Company has done an analysis and is of the opinion that it has a fair chance of favourable decision. The tax amount involved Rs 4 million (31 March 2021: Rs.4 million)

2.39 A (2)

Pursuant to judgement by the Hon''ble Supreme Court dated 28 February 2019, it was held that basic wages for the purpose of provident fund, to include special allowances which are common for all employees. However there is uncertainty with respect to the applicable of the judgement and period from which the same applies and accordingly, the Company has not estimated the impact of the same till March 2019. Owing to the aforesaid uncertainty and pending clarification from the authority in this regard, the Company has not recognised any provision till March 2019. Further management also believes that the impact of the same on the Company will not be material

2.39 B

During the year ended 31 March 2017, one party raised a damage claim against the Company by filing a request with International Chamber of Commerce in Paris. The claim is based on Letter of Comfort (âLOCâ) signed between party and the Company. At the time of entering into the above mentioned LOC, the Company also obtained indemnity letter from ultimate parent of party, indemnifying the Company against any loss arising from the LOC. Based on legal opinion and the indemnification from ultimate parent of party, the management is of the view that there is no financial implication on the Company in respect of this damage claim.

During the previous year, the Company and party have entered into settlement agreement, pursuant to which Company is required to pay Rs. 463 million {(31 March 2021 Rs. 473 million) (Euro 5.5 million)}. As per Ind AS 37, the Company has accounted for payable against settlement amount under âother financial liabilitiesâ and correspondingly recognised receivable under âother financial assetsâ.

2.41 Employee Share-Based Payment Plans

Under the Plan, upto 5,341,840 stock options can be issued to eligible employees of the Company and its subsidiaries, whether working in India or out of India, including any Director of the Company and its subsidiaries, whether whole time or otherwise excluding the Independent Directors. Under the Plan, each option, upon vesting, shall entitle the holder to acquire one equity share of Rs. 2 each. The options granted will vest gradually over a period not earlier than one year and not later than five years from the date of Grant of such Options. Vesting of Options is a function of achievement of performance criteria or any other criteria, as specified by the Committee and communicated in the grant letter.

Company as a lessor

Leases for which the Company is a lessor is classified as a finance or operating lease. Whenever the terms of the lease transfer substantially all the risks and rewards of ownership to the lessee, the contract is classified as a finance lease. All other leases are classified as operating leases. For operating leases, rental income is recognized on a straight line basis over the term of the relevant lease.

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

2.48 During the previous year, Board of Directors of the Company, in their meeting held on 09 June 2020 decided to withdraw the financial support to its material wholly owned subsidiary Minda KTSN Plastic Solutions GmbH Co. & KG, Germany (MKTSN) (including its step down subsidiaries), pursuant to which MKTSN has filed for insolvency. Accordingly, MKTSN prepared its financial statements for the year ended 31 March 2020 on the assumption that the fundamental accounting assumption of going concern is no longer appropriate. Accordingly, management has assessed the recoverability of investment, loans and other receivables given to MKTSN based on the financial statements of MKTSN and had recorded impairment loss of Rs. 2,796 million in respect of its investments, loans and other receivables from MKTSN. Further, the management had also provided for Rs. 870 million pursuant to guarantee given by the Company to banks in respect of loans taken by MKTSN. The total charge of Rs. 3,666 million was presented as exceptional items in the Statement of Profit and Loss for the year ended 31 March 2020. Break up is as follows:

The management assessed that the fair values of current financial assets and liabilities significantly approximate their carrying amounts largely due to the current maturities of these instruments. Accordingly, management has not disclosed fair values for financial instruments such as trade receivables, trade payables, cash and cash equivalents, other current assets, interest accrued on fixed deposits, other current liabilities etc.

There have been no transfers between Level 1, Level 2 and Level 3 for the years ended 31 March 2022 and 31 March 2021.

âValuation technique used to determine fair value

Valuation processes

b. Financial risk management

The Company has exposure to the following risks arising from financial instruments:

- Credit risk ;

- Liquidity risk ; and

- Market risk - Foreign exchange

- Market risk - Interest rate Risk management framework

(iii) Valuation technique used to determine fair value

The Company has used discounted cash flow method (income approach) for equity instrument and compulsorily convertible debentures.

The Company believes that its liquidity position, including total cash and cash equivalent and bank balances other than cash and cash equivalent of Rs 2,164 million as at 31 March 2022 (31 March 2021 Rs.4,621 million), anticipated future internally generated funds from operations, and its fully available, revolving undrawn credit facility will enable it to meet its future known obligations in the ordinary course of business. However, if a liquidity needs were to arise, the Company believes it has access to financing arrangements, value of unencumbered assets, which should enable it to meet its ongoing capital, operating, and other liquidity requirements. The Company will continue to consider various borrowing or leasing options to maximize liquidity and supplement cash requirements as necessary.

The Company''s liquidity management process as monitored by management, includes the following::

- Day to day funding, managed by monitoring future cash flows to ensure that requirements can be met.

- Maintaining rolling forecasts of the Company''s liquidity position on the basis of expected cash flows.

- Maintaining diversified credit lines.

Currency risk

(iii Market risk Interest rate risk

Exposure to interest rate risk

The Company''s interest rate risk arises majorly from the term loans from banks carrying floating rate of interest. These obligations exposes the Company to cash flow interest rate risk. The exposure of the Company''s borrowing to interest rate changes as reported to the management at the end of the reporting period are as follows:

2.50 Capital management

2.54 Other statutory information

1. The Company do not have any Benami property, where any proceeding has been initiated or pending against the Company for holding any Benami property.

2. The Company do not have any charges or satisfaction which is yet to be registered with ROC beyond the statutory period,

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

4. The Company has not advanced or loaned or invested funds to any other person(s) or entity(ies), including foreign entities (Intermediaries) with the understanding that the Intermediary shall:

(a) directly or indirectly lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the company (Ultimate Beneficiaries) or

(b) provide any guarantee, security or the like to or on behalf of the Ultimate Beneficiaries

5. The Company have not received any fund from any person(s) or entity(ies), including foreign entities (Funding Party) with the understanding (whether recorded in writing or otherwise) that the Company shall:

(a) directly or indirectly lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the Funding Party (Ultimate Beneficiaries) or

(b) provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries,

6. The Company does not have any such transaction which is not recorded in the books of accounts that has been surrendered or

disclosed as income during the year in the tax assessments under the Income Tax Act, 1961 (such as, search or survey or any other relevant provisions of the Income Tax Act, 1961

2.55 Quarterly returns submitted with the bank

The quarterly returns or statements filed by the Company for working capital limits with banks and financial institutions are not in agreement with the books of account of the Company, details of the differences were noted between the amount as per books of account for respective quarters and amount as reported in the quarterly statements is as follows.

The differences were in case of Debtors amounting to Rs. 917 million (amount reported Rs. 4,424 million vs amount per books of account Rs. 3507 million), Rs. 472 million (amount reported Rs. 4245 million vs amount per books of account Rs. 3774 million), Rs. 250 million (amount reported Rs. 4131 million vs amount per books of account Rs. 3881 million), for the quarter ended June 30, 2021, September 30, 2021, and December 31, 2021 respectively.

In the previous year the differences were in case of Debtors amounting to Rs. 621 million (amount reported Rs. 1946 million vs amount per books of account Rs. 1325 million), Rs. 636 million (amount reported Rs. 4055 million vs amount per books of account Rs. 3419 million), Rs. 834 million (amount reported Rs. 4271 million vs amount per books of account Rs. 3438 million) 965 million (amount reported Rs. 5240 million vs amount per books of account Rs. 4275 million) for the quarter ended June 30, 2020, September 30, 2020, December 31, 2020 and 31 March, 2021 respectively.

Further, Creditors had a difference of Rs. 1317 million (amount reported Rs. 2714 million vs amount per books of account Rs. 4031 million), Rs. 1440 million (amount reported Rs. 2964 million vs amount per books of account Rs. 4405 million), Rs. 1279 million (amount reported Rs. 2768 million vs amount per books of account Rs. 4047 million), for the quarter ended June 30, 2021, September 30, 2021 and December 31, 2021 respectively.; and

In the previous year, Creditors had a difference of Rs. 663 million (amount reported Rs. 1866 million vs amount per books of account Rs. 2528 million), Rs. 880 million (amount reported Rs. 3461 million vs amount per books of account Rs. 4341 million), Rs. 1084 million (amount reported Rs. 3981 million vs amount per books of account Rs. 5065 million) 366 million (amount reported Rs. 4349 million vs amount per books of account Rs. 4714 million) for the quarter ended June 30, 2020, September 30, 2020, December 31, 2020 and 31 March, 2021 respectively. ; and

Inventory had a difference of Rs. 217 million (amount reported Rs. 4124 million vs amount per books of account Rs. 3908 million), Rs. 243 million (amount reported Rs. 3996 million vs amount per books of account Rs. 3753 million), Rs. 175 million (amount reported Rs. 4156 million vs amount per books of account Rs. 3981 million), for the quarter ended June 30, 2021, September 30, 2021 and December 31, 2021.

In previous year, Inventory had a difference of Rs. 64 million (amount reported Rs. 3051 million vs amount per books of account Rs. 2987 million), Rs. 43 million (amount reported Rs. 2913 million vs amount per books of account Rs. 2870 million), Rs. 171 million (amount reported Rs. 3686 million vs amount per books of account Rs. 3515 million) 98 million (amount reported Rs. 3849 million vs amount per books of account Rs. 3751 million) for the quarter ended June 30, 2020, September 30, 2020, December 31, 2020 and 31 March, 2021 respectively.

Furthermore, information''s/ detailed for the quarter ended 31 March 2022 are yet to be submitted by the Company, basis their discussion with the banks the same shall be submitted post finalisation of statutory audit for the year ended 31 March 2022.

2.56 Consequent to disruptions caused due to continuation of pandemic, the Company has made assessment of impact of the pandemic on its business operations and has made assessment of its liquidity position for the next one year. The Company has assessed the recoverability and carrying value of its assets comprising property, plant and equipment, intangible assets, right-to-use assets, goodwill, investments, inventory, advances, trade receivables, other financial and non-financial assets etc. as at period end based on information available up to the date of approval of these standalone financial statements. Based on current indicators of future economic conditions, the Company does not forsee any significant impact on the operations and financial position of the Company as at 31 March 2022. Company will continue to closely observe the evolving scenario.

2.57 Previous year financials have been audited by a firm of Chartered Accountants other than S.R. Batliboi & Co. LLP. Further, figures for the corresponding previous year have been regrouped/ reclassified, wherever considered necessary including requirements of the amended Schedule III to the Companies Act 2013, to make them comparable with current year classification.

Mar 31, 2018

1.1. reporting entity

Minda Corporation Limited (the âCompanyâ) is a company domiciled in India, with its registered office situated at A-15, Phase -1 Ashok Vihar, Delhi - 110052. The Company has been incorporated under the provisions of Indian Companies Act and its equity shares are listed on BSE Limited (BSE) and National Stock Exchange of India (NSE). The Company is primarily involved in manufacturing of Automobile Components and Parts thereof.

1.2. significant accounting policies

This note provides a list of the significant accounting policies adopted in the preparation of these standalone financial statements. These policies have been consistently applied to all the years presented, unless otherwise stated.

a. Basis of preparation

(i) statement of compliance

These standalone financial statements have been prepared in accordance with Indian Accounting Standards (Ind AS) as per the Companies (Indian Accounting Standards) Rules, 2015 notified under Section 133 of the Companies Act, 2013, (the âActâ), Companies (Indian Accounting Standards) (Amendment) Rules, 2016 and other relevant provisions of the Act (âfinancial statementsâ).

For all the periods up to and including 31 March 2017, the standalone financial statements were prepared in accordance with the Accounting Standards specified under Section 133 of the Companies Act, 2013, read together with paragraph 7 of the Companies (Accounts) Rules, 2014 and other relevant provisions of the Act (âPrevious GAAPâ). The standalone financial statements for the year ended 31 March 2018 are the Companyâs first standalone financial statements prepared in accordance with Ind AS, therefore, Ind AS 101, First time adoption of Indian Accounting standards has been applied. An explanation of how the transition to Ind AS has effected the previously reported financial position, financial performance and cash flows of the Company is provided in Note 2.47.

The standalone financial statements were authorized for issue by the Companyâs Board of Directors on 28 May 2018.

(ii) Basis of measurement

The standalone financial statements have been prepared on the historical cost basis except for the following items:

(iii) Use of estimates and judgement

In preparation of these standalone financial statements, management has made judgements, estimates, and assumptions that affect the application of accounting policies and the reported amounts of assets and liabilities, income and expenses. Actual results may differ from these estimates.

Estimates and underlying assumptions are reviewed on an ongoing basis. Revision to accounting estimates are recognised prospectively.

Judgements

Information about judgements made in applying accounting policies that have the most significant effects on the amounts recognised in the consolidated financial statements is included in the following notes:

- leases: whether an arrangement contains a lease -point xii (a)

- lease classification - Note 2.27.1 and Note 2.35 Assumptions and estimation uncertainties

- Recognition and estimation of tax expense including deferred tax- Note 2.17

- Assessment of useful life of property, plant and equipment and intangible asset - Note 2.1 and Note 2.1(a)

- Estimation of obligations relating to employee benefits: key actuarial assumptions -Note 2.18.2

- Valuation of Inventories - Note 2.7

- Share based payments - Note 2.38

- Recognition and measurement of provisions and contingency: Key assumption about the likelihood and magnitude of an outflow of resources - Note 2.34

- Fair value measurement - Note 2.46

iv) Measurement of fair values

A number of accounting policies and disclosures require measurement of fair values, for both financial and non-financial assets and liabilities.

Fair values are categorised into different levels in a fair value hierarchy based on the inputs used in the valuation techniques.

Fair values are categorised into different levels in a fair value hierarchy based on the inputs used in the valuation techniques as follows:

Level 1: quoted prices (unadjusted) in active markets for identical assets or liabilities.

Level 2: inputs other than quoted prices included in Level 1 that are observable for the asset or liability, either directly (i.e. as prices) or indirectly (i.e. derived from prices).

Level 3: inputs for the asset or liability that are not based on observable market data (unobservable inputs).

When measuring the fair value of an asset or a liability, the Company uses observable market data as far as possible. If the inputs used to measure the fair value of an asset or a liability fall into different levels of the fair value hierarchy, then the fair value measurement is categorised in its entirety in the same level of the fair value hierarchy as the lowest level input that is significant to the entire measurement.

The Company recognises transfers between levels of the fair value hierarchy at the end of the reporting period during which the change has occurred. Also, fair value of financial instruments measured at amortised cost is disclosed in Note 2.46.

B. Current-non-current classification

The Company presents assets and liabilities in the standalone balance sheet based on current/ non-current classification.

Assets:

An asset is treated as current when it satisfies any of the following criteria:

(1) It is expected to be realised in, or is intended for sale or consumption in, the Companyâs normal operating cycle;

(2) It is held primarily for the purpose of being traded;

(3) It is expected to be realised within 12 months after the reporting date; or

(4) It is cash or cash equivalent unless it is restricted from being exchanged or used to settle a liability for at least 12 months after the reporting date.

The Company classifies all other assets as non-current. Liabilities:

A liability is classified as current when it satisfies any of the following criteria:

(1) I t is expected to be settled in the Companyâs normal operating cycle;

(2) It is held primarily for the purpose of being traded;

(3) It is due to be settled within 12 months after the reporting date; or

(4) The Company does not have an unconditional right to defer settlement of the liability for at least 12 months after the reporting date. Terms of a liability that could, at the option of the counterparty, result in its settlement by the issue of equity instruments do not affect its classification.

The Company classifies all other liabilities as non-current.

Deferred tax assets and liabilities are classified as noncurrent assets and liabilities respectively.

2.1.1 rights, preferences and restrictions attached to each class of shares

a) Equity shares of Rs.2 each (March 31, 2017: Rs.2 each, april 1, 2016: Rs.2 each) fully paid up

The Company has one class of equity shares having a par value of Rs.2 per share (March 31, 2017: Rs.2 each, April 1, 2016: Rs.2 each). Each shareholder is eligible for one vote per share held. The dividend proposed by the Board of Directors is subject to the approval of the shareholders in the ensuing Annual General Meeting, except in case of interim dividend. In the event of liquidation, the equity shareholders are eligible to receive the remaining assets of the Company after distribution of all preferential amounts, in proportion to their shareholding.

b) 0.001% cumulative redeemable preference shares of Rs.800 each fully paid up

The Company has 240,000 cumulative redeemable preference shares of Rs.800 each. The shares carry right of fixed preferential dividend at a rate of 0.001%. The holders of these shares do not have the right to vote and are compulsorily redeemable at par on or before the expiry of 20 years from the date of allotment. The dividend on the shares shall be cumulated and any unpaid dividend shall be added to the amount payable as dividend in the following year and no dividend can be paid on equity shares until the entire backlog of unpaid dividends on these shares is cleared. In the event of liquidation, these share holders are entitled to get their capital after satisfaction of dues for secured creditors, but they get preference over equity share capital. The shares have been redeemed during the current year.

2.1.2 Issue of shares to Minda Corporation Limited Employeesâ Stock Option Scheme

Pursuant to the Board of Directorâs approval in Board meeting held on 29 September 2011, the Company has constituted a trust under the name ââMinda Corporation Limited Employee Stock Option Scheme Trustââ (MCL ESOS Trust), with the objective of acquiring and holding of shares, warrants or other securities of the Company for the purpose of implementing the Companyâs ESOP Scheme. The Company has contributed a sum of â - million towards initial trust fund and later on advanced a sum or Rs.134 million to fund the purchase of Companyâs equity shares by MCL ESOS trust. The Company had issued and allotted, 267,092 equity shares of the Face Value Rs.10 each at the premium of Rs.490 per equity share to the MCL ESOS Trust, as approved in the Extra ordinary general meeting dated 24 October 2011. Further, the Company had issued bonus shares in proportion of one equity share for one share held on 29 March 2012, as decided in Extra ordinary general meeting held on 16 March 2012. In accordance with the guidance note on âGuidance Note on Accounting for Employee Share-based Paymentsâ issued by the ICAI, the Company has reduced the amount of share capital consideration (including share premium) received from MCL ESOS trust for presentation purposes, with a corresponding reduction in advance to MCL ESOS trust. However, in earlier years the Company had also inadvertantly adjusted the corresponding amount of bonus shares against the share premium account, which has been corrected in the previous year.

During the previous year, the members of the Company had approved âEmployee Stock Option Scheme, 2017â through Postal Ballot on February 10, 2017. The plan envisaged grant of stock options to eligible employees at an exercise price equal to the latest available closing price discounted by 50% or such other percentage as may be decided by the Nomination and Remuneration Committee. Accordingly, the Company had granted 2,700,000 options on March 07, 2017 at an exercise price of Rs.50 per option. During the current year the company has forfeited 870,000 options Refer note 2.38.

2.2.1 The Board of Directors, in their meeting held on 28 May 2018 recommended a final dividend of â0.35 per equity share (face value of Rs.2 per share), subject to the approval of shareholders at the forthcoming Annual General Meeting of the Company. The total dividend declared/ recommended on equity shares of the Company for the year 2017-18 is Rs. 0.60 per equity share of Rs.2 each.

2.2.2 Nature and purpose of other equity

- Securities premium reserve

The unutilized accumulated excess of issue price over face value on issue of shares. This reserve is utilised in accordance with the provisions of the Act.

- Capital redemption reserve

This represents the unutilised accumulated amount set aside at the time of redemption of preference shares. This reserve is utilised in accordance with the provisions of the Act.

- General reserve

This represents appropriation of profit by the Company and is available for distribution of dividend.

- employee stock compensation option outstanding

- remeasurements of defined benefit obligation

Remeasurements of defined benefit obligation comprises actuarial gains and losses and return on plan assets.

- equity component of compound financial instrument - Cumulative redeemable preference share

The Company had issued compulsory redeemable preference shares @0.001% (below market rate). The same were recorded at cost under previous GAAP. The Company has redeemed such preference shares during the current year. Under Ind As, the preference shares is treated as compound financial instruments and accordingly, classified as financial liability and equity. The same is recognised at amortized cost and is discounted using market rate. The differential between Fair Value and Book Value is considered as equity portion of compound financial instrument.

2.3.1 Employee benefits

a) Defined contribution plans

The Companyâs employee provident fund and Employeeâs state insurance schemes are defined contribution plans. The following amounts have been recognised as Wexpense for the year and shown under Employee benefits expense in note 2.30.

b) Defined benefit plans Gratuity

I n accordance with the Payment of Gratuity Act, 1972, the Company provides for gratuity as a defined benefit plan. The gratuity plan provides for a lump sum payment to the employees at the time of separation from the service on completion of vested period of employment i.e. five years. The liability of gratuity plan is provided based on actuarial valuation as at the end of each financial year based on which the Company contributes the ascertained liability to Life Insurance Corporation of India by whom the plan assets are maintained.

Note

The discount rate is estimated based on the prevailing market yields of Indian Government securities as at the balance sheet date for the estimated term of the obligation.

sensitivity analysis:

Reasonably possible changes at the reporting date to one of the relevant actuarial assumptions, holding other assumptions constant, would have affected the defined benefit obligation by the amounts shown below.

Although the analysis does not take into account of the full distribution of cash flows expected under the plan, it does not provide an approximation of the sensitivity of the assumptions shown.

Maturity profile:

The table below shows the expected cash flow profile of the benefits to be paid to the current membership of the plan based on past service of the employees as at the valuation date:

Although the analysis does not take into account of the full distribution of cash flows expected under the plan, it does not provide an approximation of the sensitivity of the assumptions shown.

c) other long term benefit - Compensated absences

An actuarial valuation of Compensated absence has been carried out by an independent actuary on the basis of the following assumptions:

The other long- term benefit of compensated absence in respect of employees of the Company as at 31 March 2018 amounts to Rs.52 million (March 31, 2017: Rs.53 million, April 1, 2016: Rs.38 million) and the expense recognised in the statement of profit and loss during the year for the same amounts to Rs.15 million (March 31, 2017: Rs.27 million, April 1, 2016: Rs.19 million) [Gross payment of Rs.15 million (March 31, 2017: Rs.12 million, April 1, 2016: Rs.14 million)] .

Sensitivity analysis:

Although the analysis does not take into account of the full distribution of cash flows expected under the plan, it does not provide an approximation of the sensitivity of the assumptions shown.

Maturity profile:

The table below shows the expected cash flow profile of the benefits to be paid to the current membership of the plan based on past service of the employees as at the valuation date:

Although the analysis does not take into account of the full distribution of cash flows expected under the plan, it does not provide an approximation of the sensitivity of the assumptions shown.

c) Risk Exposure

Through its defined benefit plans, the Company is exposed to a number of risks, the most significant of which are detailed below:

a) Asset volatility

The plan liabilities are calculated using a discount rate set with reference to bond yields; if plan assets underperform this yield, this will create a deficit. Most of the plan asset investments are in fixed income securities with high grades and in government securities. These are subject to interest rate risk and the fund manages interest rate risk with derivatives to minimize risk to an acceptable level. A portion of the funds are invested in equity securities and in alternative investments which have low correlation with equity securities. The equity securities are expected to earn a return in excess of the discount rate and contribute to the plan deficit. The Company intends to maintain the above investment mix in the continuing years.

b) Changes in discount rate

A decrease in discount rate will increase plan liabilities, although this will be partially offset by an increase in the value of the planâs bond holdings.

c) Inflation risks

In the plans, the payment are not linked to the inflation so this is a less material risk.

d) Life expectancy

The plan obligations are to provide benefits for the life of the member, so increases in life expectancy will result in an increase in the plansâ liabilities. This is particularly significant where inflationary increases result in higher sensitivity to changes in life expectancy.

âThe Company ensures that the investment positions are managed within an asset- liability matching (ALM) framework that has been developed to achieve long term investments that are in line with the obligations under the employee benefit plans. Within this framework, the Companyâs ALM objective is to match assets to the obligations by investing in long-term fixed interest securities with maturities that match the benefit payments as they fall due and in the appropriate currency.

The Company actively monitors how the duration and the expected yield of the investments are matching the expected cash outflows arising from the employee benefit obligations. The Company has not changed the processes used to manage its risks from previous periods. The Company uses derivatives to manage some of its risk. Investments are well diversified, such that the failure of any single investment would not have a material impact on the overall level of assets.

2.4 Accounting for leases

operating leases- As a lessee

The Company has taken on lease, accommodation for factory, offices and cars, with an option of renewal at the end of the lease term and escalation clause in a case. The leases are in the nature of cancellable operating leases. Lease rentals amounting to Rs.91 million (March 31, 2017: Rs.85 million April 1, 2016: Rs.77 million) in respect of such leases have been recognized in the statement of profit and loss for the year.

2.5 Employee share-based payment plans

The members of the Company had approved âEmployee Stock Option Scheme, 2017â through Postal Ballot on February 10, 2017. The plan envisaged grant of stock options to eligible employees at an exercise price equal to the latest available closing price discounted by 50% or such other percentage as may be decided by the Nomination and Remuneration Committee.

Under the Plan, upto 5,341,840 stock options can be issued to eligible employees of the Company and its subsidiaries, whether working in India or out of India, including any Director of the Company and its subsidiaries, whether whole time or otherwise excluding the Independent Directors. Options are to be granted at price equal to the latest available closing price discounted by 50% or such other percentage as may be decided by the Nomination and Remuneration Committee. Under the Plan, each option, upon vesting, shall entitle the holder to acquire one equity share of Rs.2 each. The options granted will vest gradually over a period not earlier than one year and not later than five years from the date of Grant of such Options. Vesting of Options is a function of achievement of performance criteria or any other criteria, as specified by the Committee and communicated in the grant letter.

The Company had opted for intrinsic value method of accounting for Employee Stock Options. The difference between the market price of the options and the exercise price on the date of grant was charged to the Statement of Profit and Loss. In the current year, on account of transition to IndAS, the Company had moved to fair value method of accounting for Employee Stock Options

Under the previous GAAP, the cost of Employee Stock Options were recognised using the intrinsic value method. Under Ind AS, the cost of Employee Stock Options is recognised based on the fair value of the options as at the grant date. Consequently, the profit for the year ended 31 March 2017 decreased by â - million.

Stock compensation expense in relation to stock options granted to employee of subsidiaries / step-down subsidiaries is Rs.13 million (Previous year Rs.2 million)

Stock compensation expense under the Fair Value Method has been determined based on fair value of the stock options. The fair value of stock options was determined using the Black Scholes option pricing model with the following assumptions:

2.6 During the current year, as required under section 135 of the Act, the Company has spent Rs.12 million (previous year Rs.10 million) towards the corporate social responsibility (CSR activity). Relevant disclosures for amount to be spent vis a viz amount spent during the year are as below :

2.7 The Company has established a comprehensive system of maintenance of information and documents as required by the transfer pricing legislation under section 92-92F of the Income Tax Act, 1961. Since the law requires existence of such information and documentation to be contemporaneous in nature, the Company is in the process of updating the documentation for the transactions entered into with the associated enterprises during the financial year and expects such records to be in existence latest by due date as required under the law. The management is of the opinion that its transactions with the associated enterprises are at armâs length so that the aforesaid legislation will not have any impact on the financial statements, particularly on the amount of tax expense and that of provision for taxation.

2.8 As per Ind-AS 108, Operating segments have been defined based on the regular review by the Companyâs Chief Operating Decision Maker to assess the performance of each segment and to make decision about allocation of resources. The Companyâs business activities fall within single primary business segment, viz, manufacturing of Automobile Components and Parts thereof. Accordingly, disclosures under Ind AS 108, Operating Segments are not required to be made.

2.9 The Company has a process whereby periodically all long term contracts are assessed for material foreseeable losses. At the year end, the Company has reviewed and noted that there are no foreseeable losses on long term contracts. Accordingly, no provision is required to be created in the books of account under any law / accounting standards.

2.10 During the previous year, on 4 April 2016, the Company had made an acquisition of 5,800,000 equity shares (representing 100% stake) of Minda Autoelektrik Limited (MAEL) (formerly known as Panalfa Autoelektrik Limited) at a consideration of Rs.278 million. Pursuant to the acquisition, MAEL has become a subsidiary of the Company. .

2.11 Subsequent event

Subsequent to the year ended 31 March 2018, the Company has raised funds amounting to Rs.3,107 million by way of Qualified Institutional Placement (QIP) of equity shares. According, on 21 May 2018 The Company has issued 17,910,645 shares at a price of Rs.173.47 per share whereby equity share capital has increased by Rs.36 million and share premium expense increased by Rs.3,071 million.

2.12. Financial instruments - Fair values and risk management

a. Financial instruments - by category and fair values hierarchy

The following table shows the carrying amounts and fair value of financial assets and financial liabilities, including their levels in the fair value hierarchy.

The management assessed that the fair values of short term financial assets and liabilities significantly approximate their carrying amounts largely due to the short-term maturities of these instruments. Accordingly, management has not disclosed fair values for financial instruments such as trade receivables, trade payables, cash and cash equivalents, other current assets, interest accrued on fixed deposits, other current liabilities etc.

The fair value of the financial assets and liabilities is included at the amount at which the instrument could be exchanged in a current transaction between willing parties, other than in a forced or liquidation sale

There have been no transfers between Level 1, Level 2 and Level 3 for the years ended March 31, 2018, March 31, 2017 and April 1, 2016.

Valuation technique used to determine fair value

Valuation processes

b. financial risk management

The Company has exposure to the following risks arising from financial instruments:

- Credit risk ;

- Liquidity risk ; and

- Market risk - Foreign exchange

- Market risk - Interest rate risk management framework

The Companyâs board of directors has overall responsibility for the establishment and oversight of the Companyâs risk management framework. The board of directors have authorised senior management to establish the processes, who ensures that executive management controls risks through the mechanism of properly defined framework.

The Companyâs risk management policies are established to identify and analyse the risks faced by the Company, to set appropriate risks limits and controls, to monitor risks and adherence to limits. Risk management policies are reviewed regularly to reflect changes in market conditions and the Companyâs activities. The Company, through its training and management standards and procedures, aims to maintain a disciplined and constructive control environment in which all employees understand their roles and obligations.

Credit risk on cash and cash equivalents is limited as the Company generally invests in deposits with banks with high credit ratings assigned by domestic credit rating agencies.

The maximum exposure to the credit risk at the reporting date is primarily from trade receivables. Trade receivables are unsecured and are derived from revenue earned from customers primarily located in India. The Company does monitor the economic environment in which it operates. The Company manages its credit risk through credit approvals, establishing credit limits and continuously monitoring credit worthiness of customers to which the Company grants credit terms in the normal course of business.

Credit risk has always been managed by the Company through credit approvals, establishing credit limits and continuously monitoring the creditworthiness of customers to which the Company grants credit terms in the normal course of business. On account of adoption of Ind AS 109, the Company uses expected credit loss (ECL) model to assess the impairment loss or gain. The Company uses a provision matrix to compute the expected credit loss allowance for trade receivables and unbilled revenues. The provision matrix takes into account available external and internal credit risk factors such as Companyâs historical experience for customers. The reversal for lifetime expected credit loss on customer balances for the year ended March 31, 2018 was â - million. The reversal for lifetime expected credit loss on customer balances for the year ended March 31, 2017 was â - million.

b. Financial risk management

(ii) Liquidity risk

Liquidity risk is the risk that the Company will encounter difficulty in meeting the obligations associated with its financial liabilities that are settled by delivering cash or another financial asset. The Companyâs approach to managing liquidity is to ensure, as far as possible, that it will have sufficient liquidity to meet its liabilities when they are fallen due, under both normal and stressed conditions, without incurring unacceptable losses or risking damage to the Companyâs reputation.

The Company believes that its liquidity position, including total cash and cash equivalent and bank balances other than cash and cash equivalent of Rs.25 million as at March 31, 2018 (March 31, 2017 Rs.7 million April 1, 2016 Rs.477 million), anticipated future internally generated funds from operations, and its fully available, revolving undrawn credit facility will enable it to meet its future known obligations in the ordinary course of business. However, if a liquidity needs were to arise, the Company believes it has access to financing arrangements, value of unencumbered assets, which should enable it to meet its ongoing capital, operating, and other liquidity requirements. The Company will continue to consider various borrowing or leasing options to maximize liquidity and supplement cash requirements as necessary.

The Companyâs liquidity management process as monitored by management, includes the following:

- Day to day funding, managed by monitoring future cash flows to ensure that requirements can be met.

- Maintaining rolling forecasts of the Companyâs liquidity position on the basis of expected cash flows.

- Maintaining diversified credit lines.

I. Financing arrangements

The company had access to the following undrawn borrowing facilities at the end of the reporting period:

Currency risk

Exposure to currency risk

The summary of quantitative data about the Companyâs exposure to currency risk, as expressed in Indian Rupees, as at March 31, 2018, March 31, 2017 and April 1, 2016 are as below:

Sensitivity analysis

A reasonably possible strengthening (weakening) of the Indian Rupee against below currencies at March 31, 2018 (previous year ended as on March 31, 2017) would have affected the measurement of financial instruments denominated in functional currency and affected equity and profit or loss by the amounts shown below. This analysis is performed on foreign currency denominated monetary financial assets and financial liabilities outstanding as at the year end. This analysis assumes that all other variables, in particular interest rates, remain constant and ignores any impact of forecast sales and purchases.

USD: United States Dollar, EUR: Euro, GBP: Great British Pound, CHF: Swiss Franc, JPY: Japanese Yen Interest rate risk

Interest rate risk is the risk that the future cash flows of a financial instrument will fluctuate because of changes in market interest rates. The Companyâs main interest rate risk arises from long-term borrowings with variable rates, which expose the Company to cash flow interest rate risk.

Exposure to interest rate risk

The Companyâs interest rate risk arises majorly from the term loans from banks carrying floating rate of interest. These obligations exposes the Company to cash flow interest rate risk. The exposure of the Companyâs borrowing to interest rate changes as reported to the management at the end of the reporting period are as follows:

Cash flow sensitivity analysis for variable-rate instruments

A reasonably possible change of 50 basis points (bps) in interest rates at the reporting date would have increased / (decreased) equity and profit or loss by the amounts shown below. This analysis assumes that all other variables, in particular foreign currency exchange rates, remain constant.

1. Capital management

For the purpose of the Companyâs capital management, capital includes issued equity share capital, share premium and all other equity reserves attributable to the equity holders of the parent. The primary objective of the management of the Companyâs capital structure is to maintain an efficient mix of debt and equity in order to achieve a low cost of capital, while taking into account the desirability of retaining financial flexibility to pursue business opportunities and adequate access to liquidity to mitigate the effect of unforeseen events on cash flows.

2.13. Explanation of transition to Ind AS

As mentioned in note 1 (i), these financial statements for the year ended March 31, 2018, are the first financial statements of the Company prepared in accordance with the Indian Accounting Standards (âInd ASâ) notified under the Companies (Indian Accounting Standards) Rules, 2015. For periods up to and including the year ended March 31, 2017, the Company prepared its financial statements in accordance with â previous GAAPâ, including accounting standards notified under the Companies (Accounting Standards) Rules, 2006 (as amended).

Accordingly, the Company has prepared financial statements which comply with Ind-AS applicable for periods ended on or after March 31, 2018, together with the comparative period data as at and for the year ended March 31, 2017, as described in the summary of significant accounting policies. In preparing these financial statements, the Companyâs opening balance sheet was prepared as at April 1, 2016, the Companyâs date of transition to Ind-AS.

This note explains the principal adjustments made by the Company in restating its previous 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, 2017.

According to Ind AS 101, the first Ind AS financial statements must use recognition and measurement principles that are based on standards and interpretations that are effective for the financial year ended March 31, 2018. These accounting principles and measurement principles must be applied retrospectively to the date of transition to Ind AS and for all periods presented within the first Ind AS financial statements. Any resulting differences between carrying amounts of assets and liabilities according to Ind AS 101 as of April 1, 2016 compared with those presented in the previous GAAP Balance Sheet as of March 31, 2016, were recognised in equity within the Ind AS Balance Sheet.

A. Exemptions and exceptions availed

Set out below are the applicable Ind AS 101 optional exemptions and mandatory exceptions applied in the transition from previous GAAP to Ind AS.

Transition elections

Explanation of the Ind AS 101 exceptions and exemptions to the full retrospective application of Ind AS applied by the Company.

In the Ind AS opening Balance Sheet as at April 1, 2016, the carrying amounts of assets and liabilities from the previous GAAP as at March 31, 2016 are generally recognised and measured according to Ind AS in effect for the financial year ended as on March 31, 2018. For certain individual cases, however, Ind AS 101 provides for optional exemptions to the general principles of retrospective application of Ind AS. The Company has made use of the following exemptions in preparing its Ind AS opening Balance Sheet.

a) Ind AS optional exemptions:

(i) Property, plant and equipment and intangible assets

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

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

(ii) Investment in subsidiaries/associate

I nvestment in subsidiaries/associates in standalone financial statements are carried at cost which is similar to accounting in previous GAAP. The Company also had option to account for investment in subsidiaries/associate at fair value. The company has opted to carry its investmet at subsidiary at its cost.

b) Ind AS mandatory exceptions:

(i) Estimates

An entityâs estimates in accordance with Ind ASs at the date of transition to Ind AS shall be consistent with estimates made for the same date in accordance with previous GAAP (after adjustments to reflect any difference in accounting policies), unless there is objective evidence that those estimates were in error. However, the estimates should be adjusted to reflect any difference in accounting policies.

I nd AS estimates as at April 1, 2016 are consistent with the estimates as at the same date made in conformity with previous GAAP. The Company has made estimates for following items in accordance with Ind AS at the date of transition as these were not required under previous GAAP:

a) Determination of the discounted value for financial instruments carried at amortised cost

b) Impairment of financial assets based on expected credit loss model

(ii) Classification and measurement of financial assets

Ind AS 101 requires an entity to assess classification and measurement of financial assets on the basis of the facts and circumstances that exist at the date of transition to Ind AS.Further, the standard permits measurement of financial assets accounted at amortised cost based on facts and circumstances existing at the date of transition if retrospective application is impracticable.

Accordingly, the Company has determined the classification of financial assets based on facts and circumstances that exist on the date of transition. Measurement of the financial assets accounted at amortised cost has been done retrospectively except where the same is impracticable.

B. reconciliations between previous GAAp and ind As:

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

(v) Impact of Ind AS adoption on the statements of cash flows for the year ended March 31, 2016

There were no material differences between the statement of cash flows presented under Ind AS and the Previous GAAP except due to various re-classification adjustments recorded under Ind AS and difference in the definition of cash and cash equivalents under these two GAAPs.

C. Notes to the reconciliations:

1 Interest free corporate guantees given for group companies

The Company has given corporate guarantees for certain group companies for which the Company was not charging any financial assistance fees. Under Ind AS, financial guarantee contracts are fair valued. Accordingly, financial assistance fees is recognised using prevelant market rate and accounted for by applying effective interest rate method. Consequent to this change, the amount of investment as on March 31, 2017 has increased by Rs.26 million (April 1, 2016 : Rs.23 million) with a creation of other liability (included in other non-current and current liabilities) of Rs.13 million (April 1, 2016 : Rs.17 million). The total equity increased by Rs.6 million as at April 1, 2016. The unwinding of other liability happens by recording in the same in the nature of financial assistance fees in Statement of Profit and Loss at effective interest rate. Accordingly, the profit for the year ended March 31, 2017 is increased by Rs.7 million on account of this.

2 ESOP Adjustment

a The Company had issued 1,335,460 equity shares of Rs.2 each to Minda Corporation Ltd. Employees Stock Option Scheme (âthe trustâ) at a security premium of Rs.98 per share but not allotted to employees . The Company had also given a loan of Rs.134 million to the trust for purchase of such shares. Under the previous GAAP, the Company had consolidated the trust in separate financial statements under which the share capital and share premium is shown after reducing the shared held by the trust and after eliminating the loan given to the trust. Further, the Company had received a repayment against such loan in the financial year 2016-17 of Rs.9 million which was adjusted to retained earnings. However, as per the requirement of Ind AS, the Company has now treated the trust as a separate legal entity. Consequent to this change, the total equity is increased by Rs.134 million as at 01 April 2016 (Rs.125 million as at 31 March 2017). Further, the loan given to the trust (included in non-current financial liabilities) increase by Rs.134 million as at 01 April 2016 (Rs.125 million as at 31 March 2017).

b The Company has issued employee stock options to the employees of some of the subsidiaries and jointly controlled entities. The cost for such options is calculated based on the fair value method. The grant date fair value of options granted to employees of the Company is recognized as an employee expense, and those granted to employees of subsidiaries is considered as the Companyâs equity contribution and is added to the carrying value of investment in the respective subsidiaries, with a corresponding increase in share option outstanding account, over the period that the employees become unconditionally entitled to the options. Consequently, the Investments and Equity increased by Rs.1 million as at 31 March 2017.

3 Security deposits

Under Previous Indian GAAP, interest free security deposits (that are refundable in cash on completion of the term) are recorded at their transaction value. Under Ind AS, such financial assets are recognised at amortised cost. Difference between the amortised cost and carrying value of the security deposit has been recognised as deferred rent. Consequent to this change the amount of security deposit as on March 31, 2017 has decreased by Rs.7 million (April 1, 2016 : Rs.6 million) with a creation of deferred rent (included in other non-current and current assets) of Rs.6 million(April 1, 2016 : Rs.5 million). The total equity decreased by Rs.1 million as at April 1, 2016. The unwinding of security deposit happens by recognition of a notional interest income in Statement of Profit and Loss at effective interest rate. The deferred rent gets amortised on a straight line basis over the term of the security deposits.

4 Interest free Loans to employees

Under Previous GAAP, employee loans to be settled in cash are recorded at cost. However, under Ind AS, certain assets covered under Ind AS 32 meet the definition of financial assets which include employee loans are classified at amortized cost, further these financial assets have been given at nil interest rate, therefore, these have been discounted to present value. Accordingly, loan to employees is accounted at amortized cost using prevalent market rate of interest by applying effective interest rate method.

Consequent to, this change, the amount of advance to employees as on March 31, 2017 has decreased with a creation of deferred employee benefit expense (included in other non-current and current assets). The deferred employee benefit expense gets amortised on a straight line basis over the term of the loan to employees. The profit and total equity for the year ended March 31, 2017 increased due to amortisation of employee benefit expense and increase in notional interest income recognised on loan to employees (included in other income).

5 Mark-to-market gain recognition on Derivative contracts

Recognition of unrealized mark-to-market gain on forward contracts was not permitted under previous GAAP. However, the same is allowed to be recognised in Ind As. Consequently, total equity decreased by Rs.1 million as at 31 March 2017 (â (2 million): 01 April 2016).

6 Cumulative redeemable preference share

The Company had issued cumulative redeemable preference shares @0.001% (below market rate). The same were recorded at cost under previous GAAP. The Company has redeemed such preference shares during the current year. Under Ind As, the preference shares are treated as compound financial instruments and are classified as financial liability and equity. The component of financial liability is recognised at amortized cost and is discounted using market rate. The differential between amortised cost of financial liability and carrying value of preference share is considered as equity portion of compound financial instrument. Consequent to this change, the financial liability as on March 31, 2017 has increased by Rs.146 million (April 1, 2016 : Rs.121 million). The total equity as on March 31, 2017 has increased by Rs.25 million (April 1, 2016 : Rs.71 million).

7 Borrowings

âInd AS 109 requires transaction costs incurred towards origination of borrowings to be deducted from the carrying amount of borrowings on initial recognition. These costs are recognised in the profit or loss over the tenure of the borrowing as part of the interest expense by applying the effective interest rate method.

Under previous GAAP, these transaction costs were charged to profit or loss as and when incurred. Accordingly, borrowings as at March 31, 2017 have been reduced by Rs.5 million (April 1, 2016 - Rs.2 million) with a corresponding adjustment to retained earnings. The total equity increased by an equivalent amount. The profit for the year ended March 31, 2017 reduced by â3 million as a result of the additional interest expense.â

8 Proposed dividend

Under the previous GAAP, dividends proposed by the board of directors after the balance sheet date but before the approval of the financial statements were considered as adjusting events. Accordingly, provision for proposed dividend was recognised as a liability. Under Ind AS, such dividends are recognised when the same is approved by the shareholders in the general meeting. Accordingly, the liability for proposed dividend and corporate dividend tax of â Nil as at March 31, 2017 (April 1, 2016 - Rs.76 million ) included under provisions has been reversed with corresponding adjustment to retained earnings. Consequently, the total equity increased by an equivalent amount.

9 Employee benefits: Remeasurement of post employment benefit plans

Under Ind AS, remeasurements i.e. actuarial gains and losses on the net defined benefit liability are recognised in other comprehensive income instead of statement of profit and loss. Under previous GAAP these were forming part of the statement of profit and loss for the year. As a result, loss for the year ended March 31, 2017 is increased by Rs.11 million (net of tax) and is reclassified to other comprehensive income. There is no impact on the total equity as at March 31, 2017.

10 Excise duty

Under the previous GAAP, revenue from sale of products was presented exclusive of excise duty. Under Ind AS, revenue from sale of goods is presented inclusive of excise duty. The excise duty paid is presented on the face of the statement of profit and loss as part of expenses. This change has resulted in an increase in total revenue and total expenses for the year ended 31 March 2017 by Rs.591 million. There is no impact on the total equity and profit.

11 Deferred tax

Previous GAAP requires deferred tax accounting using the income statement approach, which focuses on differences between taxable profits and accounting profits for the period. Ind AS 12 requires entities to account for deferred taxes using the balance sheet approach, which focuses on temporary differences between the carrying amount of an asset or liability in the balance sheet and its tax base.

I n addition, the various transitional adjustments lead to temporary differences. Deferred tax adjustments are recognised in correlation to the underlying transaction either in reserve and surplus or a separate component of equity. On the date of transition (i.e April 1, 2016), the net impact on deferred tax liabilities is of â Nil (March 31, 2017: Rs.2 million). The profit and total equity for the year ended March 31, 2017 decreased by Rs.2 million due to differences in taxable profits and accounting profits.

12 other comprehensive income

Under previous GAAP, there was no requirement to disclose any item of statement of profit and loss in other comprehensive income. However as per requirement of Ind AS certain items of profit or loss are to be reclassified to other comprehensive income. Consequent to this, the Company has reclassified remeasurement of defined benefit plans from the statement of profit and loss to other comprehensive income.

Mar 31, 2017

b) 0.001% cumulative redeemable preference shares of Rs, 800 each fully paid up

The Company has 240,000 cumulative redeemable preference shares of Rs, 800 each. The shares carry right of fixed preferential dividend at a rate of 0.001%. The holders of these shares do not have the right to vote and are compulsorily redeemable at par on or before the expiry of 20 years from the date of allotment. The dividend on the shares shall be cumulated and any unpaid dividend shall be added to the amount payable as dividend in the following year and no dividend can be paid on equity shares until the entire backlog of unpaid dividends on these shares is cleared. In the event of liquidation, these share holders are entitled to get their capital after satisfaction of dues for secured creditors, but they get preference over equity share capital.

1. Issue of shares to Minda Corporation Limited Employees'' Stock Option Scheme

Pursuant to the Board of Director''s approval in Board meeting held on 29 September 2011, the Company has constituted a trust under the name ''''Minda Corporation Limited Employee Stock Option Scheme Trust'''' (MCL ESOS Trust), with the objective of acquiring and holding of shares, warrants or other securities of the Company for the purpose of implementing the Company''s ESOP Scheme. The Company has contributed a sum of Rs, 1,00,000 towards initial trust fund and later on advanced a sum or Rs, 133,546,000 to fund the purchase of Company''s equity shares by MCL ESOS trust. During a prior year, the Company had issued and allotted, 267,092 equity shares of the Face Value Rs, 10 each at the premium of Rs, 490 per equity share to the MCL ESOS Trust, as approved in the Extra ordinary general meeting dated 24 October 2011. Further, the Company had issued bonus shares in proportion of one equity share for one share held on 29 March 2012, as decided in Extra ordinary general meeting held on 16 March 2012. In accordance with the guidance note on ''Guidance Note on Accounting for Employee Share-based Payments" issued by the ICAI, the Company has reduced the amount of share capital consideration (including share premium) received from MCL ESOS trust for presentation purposes, with a corresponding reduction in advance to MCL ESOS trust. However, in earlier years the Company had also inadvertently adjusted the corresponding amount of bonus shares against the share premium account, which has been corrected in the previous year.

During the current year, the members of the Company had approved ''Employee Stock Option Scheme, 2017'' through Postal Ballot on February 10, 2017. The plan envisaged grant of stock options to eligible employees at an exercise price equal to the latest available closing price discounted by 50% or such other percentage as may be decided by the Nomination and Remuneration Committee. Accordingly, the Company has granted 2,700,000 options on March 06, 2017 at an exercise price of Rs, 50 per option. Refer note 2.31.

2. The Board of directors, in their meeting held on 13 February 2017 has declared an interim dividend of Rs, 0.20 per equity share (face value Rs, 2 per share) and has further in its meeting held on 24 May 2017 recommended a final dividend of Rs, 0.30 per equity share (face value of Rs, 2 per share) and Rs, 0.008 per share on 240,000 0.001% cumulative redeemable preference shares (face value of Rs, 800 each) subject to the approval of shareholders at the forthcoming Annual General Meeting of the Company. The total dividend declared/ recommended on equity shares of the Company, for the year 2016 -17 is Rs, 0.50 per equity share of Rs, 2 each.

b) Defined benefit plans Gratuity

In accordance with the Payment of Gratuity Act, 1972, the Company provides for gratuity as a defined benefit plan. The gratuity plan provides for a lump sum payment to the employees at the time of separation from the service on completion of vested period of employment i.e. five years. The liability of gratuity plan is provided based on actuarial valuation as at the end of each financial year based on which the Company contributes the ascertained liability to Life Insurance Corporation of India by whom the plan assets are maintained.

Note:

The discount rate is estimated based on the prevailing market yields of Indian Government securities as at the balance sheet date for the estimated term of the obligation.

c) Other long term benefit - Compensated absences

An actuarial valuation of Compensated absence has been carried out by an independent actuary on the basis of the following assumptions:

The other long- term benefit of compensated absence in respect of employees of the Company as at 31 March 2017 amounts to Rs, 52,720,720 (previous year Rs, 38,261,393) and the expense recognized in the statement of profit and loss during the year for the same amounts to Rs, 26,696,673 (previous year Rs, 18,684,190) [Gross payment of Rs, 12,237,448 (previous year 13,981,558)]

3.RELATED PARTY DISCLOSURES AS REQUIRED UNDER ACCOUNTING STANDARD (AS) - 18 "RELATED PARTY DISCLOSURE":

A) Related parties and nature of related party relationship with whom transactions have taken place during the year Description of relationship Name of the party

a) Related parties and nature of related party relationships where control exists

Subsidiary (including step down subsidiaries) Minda SAI Limited, India

Minda Europe B.V., Netherlands

Minda Management Service Limited, India

Minda KTSN Plastic Solution GMBH & Co.KG, Germany

KTSN Kunststoffechnik Sachsen Beteiligung, Germany

Minda Automotive Solution Limited, India_

Minda Stoneridge Instruments Limited, India (note 1)

P T Minda Automotive, Indonesia

Minda Vietnam Automotive Co. Ltd., Vietnam

P T Minda Automotive Trading, Indonesia

Almighty International PTE Limited, Singapore

Minda Furukawa Electric Private Limited, India

Minda Schenk Plastic Solutions S.P. Z O.O. Poland

Minda KTSN Plastic Solutions Mexico, S. de R.L. de C.V, Mexico

(note 4)

Spark Minda Foundation Minda Autoelektrik Limited, India

b) Key Managerial Personnel Mr. Ashok Minda - Chairman

Mr. Sudhir Kashyap - Executive Director and CEO Mr. Sanjay Aneja - CFO

_Mr. Ashim Vohra - CEO_

Mr. Ajay Sancheti - Company Secretary Relative of Key Managerial Personnel Mr. Akash Minda - Son of Mr. Ashok Minda

c) Enterprise in which directors of the Company Minda Capital Limited, India and their relatives are able to exercise significant influence:

Minda Industries Limited, India

Minda S.M. Technocast Limited, India

Minda Stoneridge Instruments Limited, India (note 1)

Minda Silca Engineering Private Limited, India (note 2)

Dorset Kaba Security Systems Private Limited, India Mars Industries Limited, India Minda Spectrum Advisory Limited, India Tuff Engineering Private Limited, India

d) Joint Venture Minda Vast Access Systems Private Limited (formerly known

Minda Valeo Security System Private Limited, India (note 3)

e) Associates Minda Vast Access Systems Private Limited (formerly known

Minda Valeo Security System Private Limited, India (note 3)

Note 1 During the previous year, one of the Company''s wholly owned subsidiary, Minda Sai Limited has acquired 51% stake in Minda Stone ridge Instruments Limited at a consideration of Rs, 6,493 lakhs. Pursuant to this acquisition, Minda Stone ridge Instruments Limited has become a step subsidiary of the Company w.e.f. 1 October 2015. The disclosure of transactions has been accordingly presented.

Note 2 Minda Silica Engineering Limited has become a private limited Company w.e.f. 3 June 2015.

Note 3 During the previous year, one of the Company''s subsidiary, Minda Management Services Limited has entered into a joint venture agreement with Vehicle Access System Technology LLC, USA on 30 April 2015. Pursuant to this agreement, Minda Vast Access System Private Limited (formerly known Minda Valeo Security System Private Limited) has become a joint venture of the Company through its subsidiary w.e.f. 1 May 2015. The disclosure of transactions has been accordingly presented.

Note 4 During the previous year, one of the Company''s wholly owned subsidiary, Minda KTSN Plastic Solution GMBH & Co.KG, Germany has set up a subsidiary Minda KTSN Plastic Solutions Mexico, S. de R.L. de C.V, Mexico with a capital of Euro 5 lakhs on 5 February 2016. Accordingly, Minda KTSN Plastic Solutions Mexico, S. de R.L. de C.V, Mexico has become a step subsidiary of the Company w.e.f. 5 February 2016.

4. EMPLOYEE SHARE-BASED PAYMENT PLANS

Under the Plan, up to 5,341,840 stock options can be issued to eligible employees of the Company and its subsidiaries, whether working in India or out of India, including any Director of the Company and its subsidiaries, whether whole time or otherwise excluding the Independent Directors. Options are to be granted at price equal to the latest available closing price discounted by 50% or such other percentage as may be decided by the Nomination and Remuneration Committee. Under the Plan, each option, upon vesting, shall entitle the holder to acquire one equity share of '' 2 each. The options granted will vest gradually over a period not earlier than one year and not later than five years from the date of Grant of such Options. Vesting of Options is a function of achievement of performance criteria or any other criteria, as specified by the Committee and communicated in the grant letter.

The Company has opted for intrinsic value method of accounting for Employee Stock Options. The difference between the market price of the options and the exercise price on the date of grant is charged to the Statement of Profit and Loss.

Stock compensation expense in relation to stock options granted to employee of subsidiaries / step-down subsidiaries is Rs, 1,481,578 (Previous year Rs, Nil)

If the Company had considered ''fair value" of the options on the date of grant instead of the ''intrinsic value" , the effect on earnings per share would be as under:

* Net of employee stock compensation expense in relation to stock options granted to employees of subsidiaries.

The impact of differential stock compensation expense if the ''fair value" of the options on the date of grant was considered instead of the ''intrinsic value" on earnings per share for continuing operations is not material for the year.

5. The Company has established a comprehensive system of maintenance of information and documents as required by the transfer pricing legislation under section 92-92F of the Income Tax Act, 1961. Since the law requires existence of such information and documentation to be contemporaneous in nature, the Company is in the process of updating the documentation for the transactions entered into with the associated enterprises during the financial year and expects such records to be in existence latest by due date as required under the law. The management is of the opinion that its transactions with the associated enterprises are at arm''s length so that the aforesaid legislation will not have any impact on the financial statements, particularly on the amount of tax expense and that of provision for taxation.

6.The Company operates only in one business segment i.e. manufacture of auto components / accessories from various locations in India. Further, in accordance with Accounting Standard 17 - ''Segment Reporting'', segment information has been given in the Consolidated Financial Statement of Minda Corporation Limited, and therefore, no separate disclosure on segment information is given in these financial statements.

7. The Company has a process whereby periodically all long term contracts are assessed for material foreseeable losses. At the year end, the Company has reviewed and noted that there are no foreseeable losses on long term contracts. Accordingly, no provision is required to be created in the books of account under any law / accounting standards.

8. During the current year on 04 April, 2016, the Company had made an acquisition of 5,800,000 equity shares (representing 100% stake) of Minda Autoelektrik Limited (MAEL), (Formerly known as panalfa Autoelektrik Limited) at Consideration of Rs,2783 lacs. Pursuant to the acquisition, MAEL has become a subsidiary of the Company.

Mar 31, 2016

1. Rights, preferences and restrictions attached to each class of shares

a) Equity shares of Rs. 2 each (previous year Rs. 2 each) fully paid up

The Company has one class of equity shares having a par value of Rs. 2 per share (previous year Rs. 2). Each shareholder is eligible for one vote per share held. The dividend proposed by the Board of Directors is subject to the approval of the shareholders in the ensuing Annual General Meeting, except in case of interim dividend. In the event of liquidation, the equity shareholders are eligible to receive the remaining assets of the Company after distribution of all preferential amounts, in proportion to their shareholding.

Further, certain investors ("Investors") have "Anti dilution rights" i.e. right to further subscription and price protection, ensuring that, in the event of finalisation of the terms of sale of additional shares, the Company shall (as per the procedure set out in the Articles) offer the additional shares on the finalized terms and conditions to the investors and in the event that the Company issues any additional equity shares at a price less than the Investor acquisition cost or have or permit an FPO, at such lower price, then either the Company or promoters shall transfer such number of equity shares (as per the procedures set out in the Articles) at either no additional consideration or at the lowest possible consideration permitted under applicable law that shall be necessary to ensure that in a revised investor acquisition cost per Investor that shall be equal or lower than the price at which the additional shares are proposed to be issued. Such investors also have "pre emptive rights" wherein any member of the promoter group shall, before selling, transferring or otherwise disposing of any of its shares to a bona fide independent third party purchaser, first give notice to the Investors and each investor shall have the right (but not the obligation) to serve on the transferor a pre-emption notice requiring the transferor to transfer to the purchaser (as per the procedures set out in the Articles), or to any person nominated by the purchaser, some or all of the sale shares at the sale price.

Each such investor shall also have the Tag-along right (subject to the other provisions of Articles and such rights as mentioned above) but not the obligation to require the transferor to cause the transferee in a transfer of equity shares to purchase from such investor, for the same consideration per equity share and upon the same terms and conditions as are to be paid and given to the transferor.

562,500 and 267,092 (of Rs. 10 each) equity shares allotted on preferential basis to the investors and Minda Corporation Limited Employees Stock Option Scheme Trust (MCL ESOS Trust) on 3 November 2011 and 1 November 2011 respectively were locked in for a period of one year from the date of allotment.

b) 0.001% cumulative redeemable preference shares of Rs. 800 each fully paid up

The Company has 240,000 cumulative redeemable preference shares of Rs. 800 each. The shares carry right of fixed preferential dividend at a rate of 0.001%. The holders of these shares do not have the right to vote and are compulsorily redeemable at par on or before the expiry of 20 years from the date of allotment. The dividend on the shares shall be cumulated and any unpaid dividend shall be added to the amount payable as dividend in the following year and no dividend can be paid on equity shares until the entire backlog of unpaid dividends on these shares is cleared. In the event of liquidation, these share holders are entitled to get their capital after satisfaction of dues for secured creditors, but they get preference over equity share capital.

2. Issue of shares to Minda corporation Limited Employees'' stock option scheme

Pursuant to the Board of Director''s approval in Board meeting held on 29 September 2011, the Company has constituted a trust under the name ''''Minda Corporation Limited Employee Stock Option Scheme Trust" (MCL ESOS Trust), with the objective of acquiring and holding of shares, warrants or other securities of the Company for the purpose of implementing the Company''s ESOP Scheme. The Company has contributed a sum of Rs. 1,00,000 towards initial trust fund and later on advanced a sum or Rs. 133,546,000 to fund the purchase of Company''s equity shares by MCL ESOS trust. During a prior year, the Company had issued and allotted, 267,092 equity shares of the face value Rs. 10 each at the premium of Rs. 490 per equity share to the MCL ESOS Trust, as approved in the Extra ordinary general meeting dated 24 October 2011. Further, the Company had issued bonus shares in proportion of one equity share for one share held on 29 March 2012, as decided in Extra ordinary general meeting held on 16 March 2012. In accordance with the guidance note on "Guidance Note on Accounting for Employee Share-based Payments" issued by the ICAI, the Company has reduced the amount of share capital consideration (including share premium) received from MCL ESOS trust for presentation purposes, with a corresponding reduction in advance to MCL ESOS trust. However, in earlier years the Company had also In advertantly adjusted the corresponding amount of bonus shares against the share premium account, which has been corrected in the previous year.

3. Accounting for leases

operating leases- As a lessee

The Company has taken on lease, accommodation for factory, offices and cars, with an option of renewal at the end of the lease term and escalation clause in a case. The leases are in the nature of cancellable operating leases. Lease rentals amounting to Rs. 76,932,004 (previous year Rs. 93,377,488) in respect of such leases have been recognized in the statement of profit and loss for the year.

4. CAPITAL AND OTHER COMMITMENTS

Estimated amount of contracts remaining to be executed on capital account and not provided for (net of advances) Rs. 20,444,931 (previous year Rs. 12,517,401).

5. The Company has established a comprehensive system of maintenance of information and documents as required by the transfer pricing legislation under section 92-92F of the Income Tax Act, 1961. Since the law requires existence of such information and documentation to be contemporaneous in nature, the Company is in the process of updating the documentation for the transactions entered into with the associated enterprises during the financial year and expects such records to be in existence latest by due date as required under the law. The management is of the opinion that its transactions with the associated enterprises are at arm''s length so that the aforesaid legislation will not have any impact on the financial statements, particularly on the amount of tax expense and that of provision for taxation.

6. The Company operates only in one business segment i.e. manufacture of auto components / accessories from various locations in India. Further, in accordance with Accounting Standard 17 - ''Segment Reporting'', segment information has been given in the Consolidated Financial Statement of Minda Corporation Limited, and therefore, no separate disclosure on segment information is given in these financial statements.

7. The Company has a process whereby periodically all long term contracts are assessed for material foreseeable losses. At the year end, the Company has reviewed and noted that there are no foreseeable losses on long term contracts. Accordingly, no provision is required to be created in the books of account under any law / accounting standards.

8. Subsequent to the year end, the Company has made an acquisition of 5,800,000 Equity Shares of Panalfa Autoelektrik Ltd, for Rs. 274,978,000 on 04th April 2016, thereby, making it a 100% subsidiary of the Company.

Mar 31, 2015

1 Rights, preferences and restrictions attached to each class of shares

a) Equity shares of Rs. 2 each (previous year Rs. 10 each) fully paid up

The Company has one class of equity shares having a par value of Rs. 2 per share (previous year Rs. 10). Each shareholder is eligible for one vote per share held. The dividend proposed by the Board of Directors is subject to the approval of the shareholders in the ensuing Annual General Meeting, except in case of interim dividend. In the event of liquidation, the equity shareholders are eligible to receive the remaining assets of the Company after distribution of all preferential amounts, in proportion to their shareholding.

Further, certain investors ("Investors") have "Anti dilution rights" i.e.right to further subscription and price protection, ensuring that, in the event of finalisation of the terms of sale of additional shares, the Company shall (as per the procedure set out in the Articles) offer the additional shares on the finalized terms and conditions to the investors and in the event that the Company issues any additional equity shares at a price less than the Investor acquisition cost or have or permit an FPO, at such lower price, then either the Company or promoters shall transfer such number of equity shares (as per the procedures set out in the Articles) at either no additional consideration or at the lowest possible consideration permitted under applicable law that shall be necessary to ensure that in a revised investor acquisition cost per Investor that shall be equal or lower than the price at which the additional shares are proposed to be issued. Such investors also have "pre emptive rights" wherein any member of the promoter group shall, before selling, transferring or otherwise disposing of any of its shares to a bona fide independent third party purchaser, first give notice to the Investors and each investor shall have the right (but not the obligation) to serve on the transferor a pre-emption notice requiring the transferor to transfer to the purchaser (as per the procedures set out in the Articles), or to any person nominated by the purchaser, some or all of the sale shares at the sale price.

Each such investor shall also have the Tag-along right (subject to the other provisions of Articles and such rights as mentioned above) but not the obligation to require the transferor to cause the transferee in a transfer of equity shares to purchase from such investor, for the same consideration per equity share and upon the same terms and conditions as are to be paid and given to the transferor.

562,500 and 267,092 (of Rs. 10 each) equity shares allotted on preferential basis to the investors and Minda Corporation Limited Employees Stock Option Scheme Trust (MCL ESOS Trust) on 3 November 2011 and 1 November 2011 respectively were locked in for a period of one year from the date of allotment.

b) 0.001% cumulative redeemable preference shares of Rs. 800 each fully paid up

The Company has 240,000 cumulative redeemable preference shares of Rs. 800 each. The shares carry right of fixed preferential dividend at a rate of 0.001%. The holders of these share do not have the right to vote and are compulsorily redeemable at par on or before the expiry of 20 years from the date of allotment. The dividend on the shares shall be cumulated and any unpaid dividend shall be added to the amount payable as dividend in the following year and no dividend can be paid on equity shares until the entire backlog of unpaid dividends on these shares is cleared. In the event of liquidation, these share holders are entitled to get their capital after satisfaction of dues for secured creditors, but they get preference over equity share capital.

2 Issue of shares to Minda Corporation Limited Employees'' Stock Option Scheme

Pursuant to the Board of Director''s approval in Board meeting held on 29 September 2011, the Company has consti- tuted a trust under the name "Minda Corporation Limited Employee Stock Option Scheme Trust" (MCL ESOS Trust), with the objective of acquiring and holding of shares, warrants or other securities of the Company for the purpose of implementing the Company''s ESOP Scheme. The Company has contributed a sum of Rs. 1,00,000 towards initial trust fund and later on advanced a sum or Rs. 133,546,000 to fund the purchase of Company''s equity shares by MCL ESOS trust. During a prior year, the Company had issued and allotted, 267,092 equity shares of the face value Rs. 10 each at the premium of Rs. 490 per equity share to the MCL ESOS Trust, as approved in the Extra ordinary general meeting dated 24 October 2011. Further, the Company had issued bonus shares in proportion of one equity share for one share held on 29 March 2012, as decided in Extra ordinary general meeting held on 16 March 2012. In accordance with the guidance note on "Guidance Note on Accounting for Employee Share-based Payments" is- sued by the ICAI, the Company has reduced the amount of share capital consideration (including share premium) received from MCL ESOS trust for presentation purposes, with a corresponding reduction in advance to MCL ESOS trust. However, in earlier years the Company had also inadvertantly adjusted the corresponding amount of bonus shares against the share premium account, which has been corrected in the current year.

3 Other long term benefit - Compensated absences

The Company operates compensated absences plan, where in every employee is entitled to the benefit as per the policy of the Company in this regard. The salary for calculation of earned leave is last drawn salary. The same is payable during the service, early retirement, withdrawal of scheme, resignation by employee and upon death of employee.

4 Operating Lease- As a lessor

The Company has leased (cancellable) some of its premises and fixed assets under a fixed lease agreement that qualifies as an operating lease. Rental income for operating leases for the years ended 31 March 2015 aggregate to Rs. 5,424,000 (previous year Rs. 3,874,000).

5 Accounting for leases

Operating leases- As a lessee

The Company has taken on lease, accommodation for factory, offices and cars, with an option of renewal at the end of the lease term and escalation clause in a case. The leases are in the nature of cancellable operating leases. Lease rentals amounting to Rs. 93,377,488 (previous year: Rs. 104,588,901) in respect of such leases have been recognized in the statement of profit and loss for the year.

6 EXCEPTIONAL ITEMS

During the previous year, the Company had disposed off certain fixed assets / other assets due to discontinuance of plating business with certain customers. The Company recorded a loss on disposal of such assets amounting to Rs. nil (previous year Rs. 22,466,379).

7 CAPITAL AND OTHER COMMITMENTS

Estimated amount of contracts remaining to be executed on capital account and not provided for (net of advances) Rs. 12,517,401 (previous year Rs. 9,703,363).

8 DISCONTINUED OPERATIONS

Pursuant to the decision of the board in their meeting held on 29 May 2014 to discontinue its non core business activity (i.e. manufacturing of plastic interior parts for four wheeler), the company has sold the fixed assets of plastic business for an aggregate consideration of Rs. 129,969,066 (WDV of Rs. 124,110,488). Out of this, the Company has sold off majority of the fixed assets to one of its subsidiary on the value arrived at on the basis of a fair valuation carried out by the Company. Also, the Company has written off assets amounting to Rs. 11,863,221 in quarter ended 30 June 2014 and Rs. 1,236,004 in quarter ended 30 September 2014. Accordingly, the related business activity of the Company has been treated as discontinued operations.

9 CONTINGENT LIABILITIES

(Amount in Rs.) As at As at

31 March 2015 31 March 2014

Claims against the Company not acknowledged as debts

a) Custom duty - 161,776,450

b) Income-tax 12,262,176 12,262,176

c) Sales tax/ VAT 1,466,749 1,466,749

d) Excise duty 11,703,725 8,692,913

While the ultimate outcome of the above mentioned appeals cannot be ascertained at this time, based on current knowledge of the applicable law, management believes that these law suits should not have a material adverse effect on the Company''s financial statements or its business operations.

Others

Corporate guarantees given by the Company

i) Minda KTSN Plastic Solutions GmbH & Co. KG, Germany 1,030,287,276 1,275,062,985

ii) Minda SAI Limited 600,000,000 600,000,000

iii) Minda Furukawa Electric Private Limited 590,990,000 -

iv) Minda Management Services Limited 30,000,000 -

v) Riddi Techauto Private Limited 11,600,000 -

Movement of guarantees given to related parties

(Amount in Rs.)

S. Balance as at Given during No. Particulars 31 March 2014 the year

i) Minda KTSN Plastic Solutions 1,275,062,985 - GmbH & Co. KG, Germany

ii) Minda SAI Limited 600,000,000 -

iii) Minda Furukawa Electric - 590,990,000 Private Limited

iv) Minda Management Services - 30,000,000 Limited

v) Riddi Techauto Private Limited - 11,600,000

S. Settled / adjusted Balance as at No. Particulars during the year 31 March 2015

i) Minda KTSN Plastic Solutions 244,775,709 1,030,287,276 GmbH & Co. KG, Germany

ii) Minda SAI Limited - 600,000,000

iii) Minda Furukawa Electric - 590,990,000 Private Limited

iv) Minda Management Services - 30,000,000 Limited

v) Riddi Techauto Private Limited - 11,600,000

S. Purpose of No. Particulars Guarantees

i) Minda KTSN Plastic Solutions Working GmbH & Co. KG, Germany capital requirement ii) Minda SAI Limited

iii) Minda Furukawa Electric Private Limited

iv) Minda Management Services Limited

v) Riddi Techauto Private Limited

10 RELATED PARTY DISCLOSURES AS REQUIRED UNDER ACCOUNTING STANDARD (AS) - 18 "RELATED PARTY DISCLOSURE":

A) Related parties and nature of related party relationship with whom transactions have taken place during the year

a) Related parties and nature of related party relationships where control exists

Description of relationship Name of the party

Subsidiary (including step down subsidiaries) Minda SAI Limited, India Minda Europe B.V, Netherlands Minda Management Services Limited, India Minda KTSN Plastic Solutions GmbH & Co.KG, Germany KTSN Kunststofftechnik Sachsen Beteiligungs, Germany Minda Automotive Solutions Limited, India P T Minda Automotive, Indonesia (note 1) Minda Vietnam Automotive Co. Ltd., Vietnam (note 1)

P T Minda Automotive Trading, Indonesia (note 1) Almighty International Pte Limited, Singapore (note 1) Minda Furukawa Electric Private Limited, India (note 2) Minda Schenk Plastic Solutions S.p. Z o.o. Poland Minda KTSN Plastic Solutions S.r.o, Czech Republic Spark Minda Foundation

b) Key Managerial Personnel Mr. Ashok Minda - Chairman Mr. Sudhir Kashyap - Executive Director and CEO

c) Enterprise Minda Capital Limited, India in which Minda Industries Limited, India directors of Minda S.M. Technocast Limited, India the Company Minda Silca Engineering Limited, India and their Minda Stoneridge Instruments Limited, India relatives are Dorset Kaba Security Systems Private Limited, India able to Mars Industries Private Limited, India exercise Minda Spectrum Advisory Limited, India significant Tuff Engineering Private Limited influence:

d) Associates Minda Vast Access Systems Private Limited (formerly known Minda Valeo Security Systems Private Limited, India (note 3) Mayank Auto Engineers Private Limited, India

11 During the previous year, one of the Company''s subsidiary, Minda SAI Limited had acquired 100% stake in Almighty International Pte Limited, Singapore w.e.f. 14 February 2014. Further, pursuant to this acquision, Almighty International Pte Limited, Singapore including its step down subsidiaries viz. Minda Vietnam Automotive Co. Limited, Vietnam, PT Minda Automotive, Indonesia and P T Minda Automotive Trading, Indonesia have become subsidiaries of the Company.

12 During the previous year, the Company had acquired 49% stake in Minda Furukawa Electric Private Limited w.e.f 1 February 2014. The Company further acquired an additional 2% shareholding of Minda Furukawa Electric Private Limited during the current year. Consequent to this acquisition, Minda Furukawa Electric Private Limited has become a subsidiary of the Company with effect from 1 October 2014. Before this date, the Company was a joint venture partner in Minda Furukawa Electric Private Limited. The disclosure of transactions have been accordingly categorised as transactions with a subsidiary.

13 During the previous year, one of the Company''s subsidiary had acquired a 50% stake in Minda Vast Access Systems Private Limited (formerly known as Minda Valeo Security Systems Private Limited, w.e.f. 18 February 2014. Pursuant to this acquisition, Minda Valeo Security Systems Private Limited had become an associate of the Company''s subsidiary.

14 The Company had acquired 49% interest in Minda Furukawa Electric Private Limited on 1 February, 2014 . Minda Furukawa Electric Private Limited is a joint venture between Minda Corporation Limited and Furukawa Electric Company Limited and Furukawa Automotive Parts Inc of Japan engaged in manufacturing of wiring hireness and components related to wiring hireness. Further during the year, the Company has acquired 2% stake in Minda Furukawa ElectricPrivateLimited.Pursuant to this acquisition, Minda Furukawa ElectricPrivateLimited has become a subsidiary of the Company with effect from 1 October 2014.

15 The Company has established a comprehensive system of maintenance of information and documents as required by the transfer pricing legislation under section 92-92F of the Income Tax Act, 1961. Since the law requires existence of such information and documentation to be contemporaneous in nature, the Company is in the process of updating the documentation for the transactions entered into with the associated enterprises during the financial year and expects such records to be in existence latest by due date as required under the law. The management is of the opinion that its transactions with the associated enterprises are at arm''s length so that the aforesaid legislation will not have any impact on the financial statements, particularly on the amount of tax expense and that of provision for taxation.

16 The Company operates only in one business segment i.e. manufacture of auto components / accessories from vari- ous locations in India. Further, in accordance with Accounting Standard 17 - ''Segment Reporting'', segment infor- mation has been given in the Consolidated Financial Statement of Minda Corporation Limited, and therefore, no separate disclosure on segment information is given in these financial statements.

17 The Company has a process whereby periodically all long term contracts are assessed for material foreseeable losses. At the year end, the Company has reviewed and ensured that adequate provision as required under any law / accounting standards for material foreseeable losses on such long term contracts has been made in the books of account.

Mar 31, 2014

1.1.1 Accounting for leases

Operating leases- As a lessee

The Company has taken on lease, accommodation for factory, godowns for storage of inventories, offices and cars, with an option of renewal at the end of the lease term and escalation clause in a few cases. The leases are in the nature of cancellable operating leases. Lease rentals amounting to Rs.104,588,901 (previous year: Rs.97,056,594) in respect of such leases have been recognized in the statement of profit and loss for the year.

1.2 During the year, the Company has entered into an agreement to sell it's fixed assets pertaining to its facility at Pune, which manufactures plastic products. This agreement is subject to approval from its Board of Directors and subject to finalisation of the consideration to be arrived at on the basis of a valuation, however, at minimum of the net book value at 30th June 2014. The advance received from the other party amounting to Rs.1,500 lakhs has been shown as "advances received for sale of fixed assets" under other current liabilites.

2.1 EXCEPTIONAL ITEMS

During the year, the Company decided to dispose off certain fixed assets / other assets due to discontinuance of plating business with certain customers. As a result, the Company has recorded a loss on disposal of such assets amounting to Rs.225 lakhs (previous year Rs.233 lakhs). The exceptional items in the previous year represented expenses incurred by the Company in earlier periods in relation to potential business acquisitions. These amounts were charged off considering the elongated period with no substantial development on such acquisitions.

2.2 CAPITAL AND OTHER COMMITMENTS

Estimated amount of contracts remaining to be executed on capital account and not provided for (net of advances) Rs.9,703,363 (previous year Rs.43,220,800).

2.3 CONTINGENT LIABILITIES

(Amount in Rs)

As at As at 31 March 2014 31 March 2013

Claims against the Company not acknowledged as debts

a) Custom duty 161,776,450 5,512,848

b) Sales tax/ VAT 1,466,749 29,865,733

c) Excise duty 8,692,913 8,692,913

Others

Corporate guarantees given by the Company 1,875,062,985 1,386,552,070

2.4 RELATED PARTY DISCLOSURES AS REQUIRED UNDER ACCOUNTING STANDARD (AS) - 18 "RELATED PARTY DISCLOSURE": Related parties and nature of related party relationship with whom transactions have taken place during the year a) Related parties and nature of related party relationships where control exists

Description of relationship

Subsidiary (including step down subsidiaries)

Name of the party

Minda SAI Limited, India

Minda Europe B.V., Netherlands

Minda Management Service Limited, India

Minda KTSN Plastic Solution GMBH & Co.KG, Germany

KTSN Kunststoffechnik Sachsen Beteiligung, Germany

Minda Automotive Solution Limited, India

P T Minda Automotive, Indonesia (note 1)

Minda Vietnam Automotive Co. Ltd., Vietnam (note 1)

P T Minda Automotive Trading, Indonesia (note 1) Almighty Internaltional PTE Limited, Singapore (note 1) Minda KTSN Plastic & Tooling Solutions Sp.Z.O.O. Poland (Formerly known as Minda Schenk Plastic Solutions SpZ.O.O. Poland)

b) Key Managerial Personnel

Mr. Ashok Minda - Chairman

Mr. Sudhir Kashyap - Executive Director and CEO

Mr. Jeevan Mahaldar - Executive Director and CEO (note 5)

c) Enterprise in which directors of the Company and

their relatives are able to exercise significant influence:

Minda Capital Limited, India

Minda Industries Limited, India

Minda International Limited, India

Minda S.M. Technocast Limited, India

Minda Silca Engineering Limited, India

Minda Stoneridge Instruments Limited, India

Dorset Kaba Security Systems Private Limited, India

Mars Industries Limited, India

Jeevan Mahaldar HUF (note 5)

Minda Spectrum Advisory Limited, India

d) Joint venture

Minda Furukawa Electric Private Limited, India (note 2)

e) Associates

Minda Valeo Security System Private Limited, India (note 3 Mayank Auto Engineers Private Limited, India (note 4) Minda Schenk Plastic Solutions GmbH (LLP), Germany (note 4)

Minda Schenk Plastic Solutions S.R.O. Czech Republic (note 4)

f) Relatives of key managerial personnel

Mrs Renu Mahaldar (note 5)

Note 1 During the current year, one of the Company's subsidiary, Minda SAI Limited has acquired 100% stake in Almighty International PTE Limited, Singapore w.e.f. 14 February 2014. Further, pursuant to this acquisition, Almighty International PTE Limited, Singapore including its step down subsidiaries viz. Minda Vietnam Automotive Co. Limited, Vietnam, PT Minda Automotive, Indonesia and P T Minda Automotive Trading, Indonesia have become subsidiaries of the Company.

Note 2 The Company has acquired 49% stake in Minda Furukawa Electric Private Limited w.e.f 1 February 2014. Further, pursuant to this acquisition, the Company has become a joint venture partner in Minda Furukawa Electric Private Limited. Before this date, Minda Furukawa Electric Priave Limited was an enterprise in which directors of the Company and their relatives are able to exercise significant influence. For the sake of convenience this entity has been shown under Joint venture, whereas till 31.03.2013 it was shown under enterprises in which directors of the Company and their relatives are able to exercise significant influence.

Note 3 During the current year, one of the Company's subsidiary has acquired a 50% stake in Minda Valeo Security Systems Private Limited, w.e.f. 18 February 2014. Pursuant to this acquisition, Minda Valeo Security Systems Private Limited has become an associate of the Company's subsidiary. Before this date Minda Valeo Security Systems Private Limited was an enterprise in which directors of the Company and their relatives are able to exercise significant influence. For the sake of convenience this entity had been shown under Associates, whereas till 31.03.2013 it was shown under enterprises in which directors of the Company and their relatives are able to exercise significant influence.

Note 4 During the year, two of the Company's subsidiaries disposed of their investment in the Company's step down subsidiary. Pursuant to this Mayank Auto Engineers Private Limited along with its subsidiaries Minda Schenk Plastic Solutions Gmbh (LLP), Germany and Minda Schenk Plastic Solutions S.R.O. Czech Republic has become enterprise in which directors of the Company and their relatives are able to exercise significant influence w.e.f 1 April 2013. The same were appearing under "Subsidiaries" untill 31 March 2013. For the sake of convenience this entity had been shown under associates, whereas till 31.03.2013 it was shown under Subsidiaries.

Note 5 Mr Jeevan Mahaldar (executive director and CEO) has resigned w.e.f. 01.04.2013. Pursuant to this, he is no more Key Managerial Personnel in the Company and Jeevan Mahaldar (HUF) is no more an enterprise in which directors of the Company and their relatives are able to exercise significant influence and Mrs Renu Mahaldar is no more a relative of key mangerial personnel.

2.5 The Company has established a comprehensive system of maintenance of information and documents as required by the transfer pricing legislation under section 92-92F of the Income Tax Act, 1961. Since the law requires existence of such information and documentation to be contemporaneous in nature, the Company is in the process of updating the documentation for the transactions entered into with the associated enterprises during the financial year and expects such records to be in existence latest by due date as required under the law. The management is of the opinion that its transactions with the associated enterprises are at arm's length so that the aforesaid legislation will not have any impact on the financial statements, particularly on the amount of tax expense and that of provision for taxation.

2.6 The Company operates only in one business segment i.e. manufacture of auto components / accessories from various locations in India. Further, in accordance with Accounting Standard 17 - 'Segment Reporting', segment information has been given in the Consolidated Financial Statement of Minda Corporation Limited, and therefore, no separate disclosure on segment information is given in these financial statements.

Mar 31, 2013

1.1 EXCEPTIONAL ITEMS

In the previous periods, the Company had incurred expenditure amounting to Rs.233 lakhs (including Rs.158 lakhs jointly with other party) in respect of potential business acquisitions and pending recovery/ capitalisation along with cost of investments. However, considering the elongated period with no substantial development on such potential respective acquisitions, the management considered it prudent to charge off these expenses in this year.

1.2 CAPITAL AND OTHER COMMITMENTS

Estimated amount of contracts remaining to be executed on capital account and not provided for (net of advances) Rs.43,220,800 (previous year Rs.104,937,927).

1.3 CONTINGENT LIABILITIES

(Amount in Rs.)

Particulars As at As at 31 March 2013 31 March 2012

Claims against the Company not acknowledged as debts

a) Custom duty 5,512,848 32,048,441

b) Sales tax/ VAT 29,865,733 7,688,185

c) Excise duty 8,692,913 8,692,913

Others

a) Corporate guarantees given by the Company 1,386,552,070 569,455,526

b) Bills of exchange discounted under irrevocable letters of credit 68,237,716

1.4 UNHEDGED FOREIGN CURRENCY EXPOSURE

a) Derivative outstanding as at balance sheet date

Forward contracts in respect of foreign currency outstanding as at 31 March 2013 is Nil (Previous year US $ 600,000 equivalent to Rs.30,522,000) to hedge the foreign currency exposure for amount receivable against the export sales proceeds.

b) Particulars of unhedged foreign currency exposure as at the reporting date

The year end foreign currency exposures that have not been hedged by a derivative instrument or otherwise is as follows:

1.5 The Company operates only in one business segment i.e. manufacture of auto components/accessories from various locations in India. Further, in accordance with Accounting Standard 17 - ''Segment Reporting'', segment information has been given in the Consolidated Financial Statement of Minda Corporation Limited, and therefore, no separate disclosure on segment information is given in these financial statement.

Mar 31, 2012

1.1.1 Rights, preferences and restrictions attached to each class of shares

a) Equity shares of Rs.10/- each fully paid up

The Company has one class of equity shares having a par value of Rs.10/- per share. Each shareholder is eligible for one vote per share held. The dividend proposed by the Board of Directors is subject to the approval of the shareholders in the ensuing Annual General Meeting, except in case of interim dividend. In the event of liquidation, the equity shareholders are eligible to receive the remaining assets of the Company after distribution of all preferential amounts, in proportion to their shareholding.

Further, certain investors ("Investors") have "Anti dilution rights" i.e. right to further subscription and price protection, ensuring that, in the event of finalisation of the terms of sale of additional shares, the Company shall (as per the procedure set out in the Articles) offer the additional shares on the finalized terms and conditions to the investors and in the event that the Company issues any additional equity shares at a price less than the Investor acquisition cost or have or permit an FPO, at such lower price, then either the Company or promoters shall transfer such number of equity shares (as per the procedures set out in the Articles) at either no additional consideration or at the lowest possible consideration permitted under applicable law that shall be necessary to ensure that in a revised investor acquisition cost per Investor that shall be equal or lower than the price at which the additional shares are proposed to be issued. Such investors also have "pre emptive rights" wherein any member of the promoter group shall, before selling, transferring or otherwise disposing of any of its shares to a bona fide independent third party purchaser, first give notice to the Investors and each investor shall have the right (but not the obligation) to serve on the transferor a pre-emption notice requiring the transferor to transfer to the purchaser (as per the procedures set out in the articles), or to any person nominated by the purchaser, some or all of the sale shares at the sale price.

Each such investor shall also have the Tag-along right (subject to the other provisions of Articles and such rights as mentioned above) but not the obligation to require the transferor to cause the transferee in a transfer of equity shares to purchase from such investor, for the same consideration per equity share and upon the same terms and conditions as are to be paid and given to the transferor.

562,500 and 267,092 equity shares allotted on preferential basis to the investors and Minda Corporation Limited Employees Stock Option Scheme Trust (MCL ESOS Trust) on 3 November 2011 and 1 November 2011 respectively are locked in for a period of one year from the date of allotment.

b) 0.001% cumulative redeemable preference shares of Rs.800/- each fully paid up

The Company has 240,000 cumulative redeemable preference shares of Rs.800/- each. The shares carry right of fixed preferential dividend at a rate of 0.001%. The holders of these share do not have the right to vote and are compulsorily redeemable at par on or before the expiry of 20 years from the date of allotment. The dividend on the shares shall be cumulated and any unpaid dividend shall be added to the amount payable as dividend in the following year and no dividend can be paid on equity shares until the entire backlog of unpaid dividends on these shares is cleared. In the event of liquidation, these share holders are entitled to get their capital after satisfaction of dues for secured creditors, but they get preference over equity share capital.

1.1.2 Issue of shares to Minda Corporation Limited Employees' Stock Option Scheme

Pursuant to the Board of Director's approval in Board meeting held on 29 September 2011, the Company has constituted a trust under the name ''Minda Corporation Limited Employee Stock Option Scheme Trust'' (MCL ESOS Trust), with the objective of acquiring and holding of shares, warrants or other securities of the Company for the purpose of implementing the Company's ESOP Scheme. The Company has contributed a sum of Rs.1,00,000/- towards initial trust fund and later on advanced a sum or Rs.133,546,000/- to fund the purchase of Company's equity shares by MCL ESOS trust. Later in the year, the Company had issued and allotted, 267,092 equity shares of the face value Rs.10/- each at the premium of Rs.490/- per equity share to the MCL ESOS Trust, as approved in the Extra ordinary general meeting dated 24 October 2011. Further, the Company has issued bonus shares in proportion of one equity share for one share held on 29 March 2012, as decided in Extra ordinary general meeting held on 16 March 2012. In accordance with the guidance note on "Accounting for Employee Share-based Payments" issued by the ICAI, the Company has reduced the amount of share capital consideration (including share premium) received from MCL ESOS trust for presentation purposes, with a corresponding reduction in advance to MCL ESOS trust.

1.2.1 Finance Lease- As a lessee

The Company has taken an ERP software and certain plant and equipment under the finance lease arrangement. The lease term of these assets are 3 and 5 years respectively. The lease term is renewable for a further period of 3 and 5 years respectively, at the option of lessee.

1.2.2 Employee Benefits

a) Defined contribution plans

The Company's employee provident fund and Employee's state insurance schemes are defined contribution plans. The following amounts have been recognised as expense for the year and shown under Employee benefits expense in note 2.24.

b) Defined benefit plans-Gratuity

In accordance with the Payment of Gratuity Act, 1972, the Company provides for gratuity as a defined benefit plan. The gratuity plan provides for a lump sum payment to the employees at the time of separation from the service on completion of vested period of employment i.e. five years. The liability of gratuity plan is provided based on actuarial valuation as at the end of each financial year based on which the Company contributes the ascertained liability to Life Insurance Corporation of India by whom the plan assets are maintained.

c) Defined Benefit Plans-Compensated absence

The Company operates compensated absences plan, where in every employee is entitled to the benefit as per the policy of the Company in this regard. The salary for calculation of earned leave is last drawn salary. The same is payable during the service, early retirement, withdrawal of scheme, resignation by employee and upon death of employee.

An actuarial valuation of Compensated absence has been carried out by an independent actuary on the basis of the following assumptions.

1.3.1 Operating Lease- As a lessor

The Company has leased (cancellable) some of its premises and fixed assets to a third party under a fixed lease agreement that qualifies as an operating lease. Rental income for operating leases for the years ended 31 March 2012 and 31 March 2011 aggregate to Rs.1,824,000 and Rs.1,824,000 respectively.

1.3.2 A ccountin g for Leases

Operating leases- As a lessee

The Company has taken on lease accommodation for factory, godowns for storage of inventories, offices and cars, with an option of renewal at the end of the lease term and escalation clause in a few cases. The leases are in the nature of both cancellable and non cancellable operating leases. Lease rentals amounting to Rs.95,904,667/- (previous year: Rs.100,364,661/-) in respect of such leases have been recognized in the statement of profit and loss for the year.

1.4 CAPITAL AND OTHER COMMITMENTS

Estimated amount of contracts remaining to be executed on capital account and not provided for (net of advances) Rs.104,937,927/- (Previous year Rs.33,875,661/-).

1.5 CONTINGENT LIABILITIES

(Amount in Rs.)

Particulars As at As at 31 March 2012 31 March 2011

Claims against the Company not acknowledged as debts

a) Custom duty 32,048,441 25,963,702

b) Corporate guarantees given by the Company 569,455,526 274,751,252

c) Bills of exchange discounted under irrevocable letters of credit 68,237,716 160,256,603

d) Sales tax/ VAT 7,688,185 1,541,015

e) Excise duty 8,692,913 8,692,913

1.6 UNHEDGED FOREIGN CURRENCY EXPOSURE

a) Derivative outstanding as at balance sheet date

Forward contracts in respect of foreign currency outstanding as at 31 March 2012 is US $ 6,00,000 equivalent to Rs.30,522,000/- (Previous year Nil) to hedge the foreign currency exposure for amount receivable against the export sales proceeds.

The above does not include any foreign currency exposures from investment in body corporate outside india, which as treated as non- intergal in nature.

1.7 The Company operates only in one business segment i.e. manufacture of auto components/accessories from various locations in India. Accordingly, the disclosures for primary segment and secondary segment as specified under Accounting Standard 17 - 'Segment Reporting' prescribed by the Companies (Accounting Standards) Rules, 2006 are not applicable to the Company.

1.8 The financial statements for the year ended 31 March 2012 have been prepared considering changes pursuant to revised schedule VI to the Companies Act, 1956. Accordingly, the previous years figures have also been reclassified to conform to the current year's classification.

1.9 The previous year figures have been audited by another firm of chartered accountants.

Mar 31, 2011

1. Commitments and Contingencies

a) Estimated amount of contracts remaining to be executed on capital account and not provided for (net of advances) Rs.338.76 Lacs (Previous year Rs.138.65 Lacs).

b) (i) No forward contracts in respect of foreign currency is outstanding as at March 31, 2011 (Previous year US $ 10,00,000 equivalent to Rs.4,57,10,000) to hedge the foreign currency exposure for payments to be made against working capital loans.

(ii) The year end foreign currency exposures that have not been hedged by a derivative instrument or otherwise is as follows:

c) Export obligations to be undertaken by the Company under EPCG scheme in the subsequent years to the extent unexecuted is Rs.1,112.73 Lacs (Previous year Rs.1,232.18 Lacs).

d) Guarantees provided by the company aggregate to Rs.2,747.54 Lacs (Previous year Rs.504.96 Lacs).

e) Bills of exchange discounted under irrevocable letters of credit aggregate to Rs.1602.55 Lacs (Previous year Rs.1,383.41 lacs)

f) Letters of credit outstanding aggregate to Rs.34.40 Lacs (Previous year Rs.118.39 Lacs).

g) Demand for income tax aggregating to Rs.138.81 Lacs for the assessment year 2003-04, 2007-08, 2008-09 is disputed by the company against which the company has preferred an appeal. Out of the above, the company has deposited Rs.124.17 Lacs.

h) Demand for sales tax aggregating to Rs.15.41 Lacsfor the financial year 1998-99, 2001-02, 2005-06 is disputed by the company against which the company has preferred an appeal. Out of the above, the company has deposited Rs.9.46 Lacs.

i) Penalty and Interest demand for excise duty aggregating to Rs.86.93 Lacs (Previous year Rs.87.93 Lacs) for the financial years 2006-07 is disputed by the company against which the company has preferred an appeal. Out of the above, the company has deposited Rs.Nil (Previous Year Rs.Nil).

j) Warranties

TThe company warrants that its products will perform in all material respects in accordance with the company's standard specifications for the warranty period. Accordingly based on specific warranties, claims and claim history the company provides for warranty claims. The activity in the provision for warranty costs is as follows:

2. Leases

The company has not executed any non-cancelable operating leases.

The company is a lessee under various operating leases. Rental expense for operating leases for the years ended March 31, 2011 and 2010 was Rs.10,03,64,661 and Rs.6,49,94,277 respectively.

The company has leased some of its premises and some of its fixed assets to a third party under a fixed lease agreement that qualifies as an operating lease. Rental income for operating leases for the years ended March 31, 2011 and March 31, 2010 aggregate to Rs.18,24,000 and Rs.18,24,000 respectively.

3. Managerial Remuneration

Managerial remuneration under section 198 of the Companies Act, 1956 paid to the managing directors of the company is as follows:

The above remuneration does not include the accrued amount of leave encashment and gratuity as at year end as the company determines this amount through actuarial valuation and separate amount to directors is not ascertainable.

4. Related Party Transactions

In the normal course of business, the Company enters into transactions with affiliated companies and its parent and key managem personnel. The names of related parties of the Company as required to be disclosed under Accounting Standard 18 is as follow

a) Subsidiaries : Minda Europe B.V., Netherland.

Minda KTSN Plastic Solutions GmbH & Co KG, Germany

Minda SAI Ltd.

Mayank Auto Enginees Pvt. Ltd.

b) Key Managerial Personnel : Mr. Ashok Minda-Chairman

Mr. Jeevan Mahaldar - Managing Director

c) Enterprise in which directors of : Minda Valeo Security Systems Pvt. Ltd. the Company and their relatives Minda Stoneridge Instruments Ltd. exercises significant influence Mindarika Pvt. Ltd.

Mayank Auto Enginees Pvt. Ltd.

Minda S.M. Technocast Ltd.

Minda Silca Engineering Ltd.

Minda Industries Ltd.

Minda Furukawa Electric Pvt. Ltd.

Minda International Ltd.

Minda Capital Ltd.

Minda Management Services Ltd.

Minda Autocare Ltd.

5. Earnings per Share

The following is a computation of earnings per share and a reconciliation of the equity shares used in the computation of basic and diluted earnings per equity share.

6. Income Taxes

IIn accordance with Accounting Standard 22 on accounting for taxes on income the deferred tax liability of Rs.126.64 Lacs for the current year has been recognised in the profit and loss account. The tax effect of significant timing differences as of March 31, 2011 that reverses in one or more subsequent years gave rise to the following net deferred tax liabilities as at March 31, 2011:

* In view of various types of components as per specification of customers and being below ten percent of total value of consumption, it is not possible to provide quantitative details of each type of component.

** The total value of each item is below ten percent of total value of consumption; hence no separate quantitative detail is being given.

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