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Notes to Accounts of Savita Oil Technologies Ltd.

Mar 31, 2023

Provisions and Contingent Assets / Liabilities

Provisions are recognised when the Company has a
present obligation (legal or constructive) as a result
of past events, for which it is probable that an outflow
of resources will be required to settle the obligation
and a reliable estimate of the amount can be made.

Provisions are measured at the present value of
management''s best estimate of the outflow required
to settle the present obligation at the end of the
reporting period. If the effect of the time value of
money is material, provisions are discounted using a
current pre-tax rate that reflects, when appropriate,
the risks specific to the liability. When discounting is
used, the increase in the provision due to the passage
of time is recognized as a finance cost.

Contingent liabilities are disclosed in the case of:

• a present obligation arising from the past events,
when it is not probable that an outflow of resources
will be required to settle the obligation;

• a present obligation arising from the past events,
when no reliable estimate is possible;

• a possible obligation arising from past events, unless
the probability of outflow of resources is remote.

Contingent assets are not recognised but disclosed in
the financial statements when an inflow of economic
benefits is probable.

S. Financial instruments

Financial assets and financial liabilities are
recognised when the Company becomes a party to
the contractual provisions of the instruments.

I. Financial assets

A. Initial recognition and measurement:

Financial assets are initially measured at fair
value. Transaction costs that are directly
attributable to the acquisition of the financial
asset [other than financial assets at fair value
through profit or loss (FVTPL)] are added to the
fair value of the financial assets. Purchases or
sales of financial assets that require delivery
of assets within a time frame established by
regulation or convention in the market place
(regular way trades) are recognised on the trade
date i.e., the date that the Company commits to
purchase or sell the asset. Transaction costs of
financial assets carried at FVTPL are expensed in
the Statement of Profit and Loss. However, trade
receivables that do not contain a significant
financing component are measured at
transaction price.

B. Subsequent measurement:

For purposes of subsequent measurement,
financial assets are classified in the
following categories:

(i) Debt instruments at amortised cost

A ''debt instrument'' is measured at the
amortised cost if both the following
conditions are met:

a) The asset is held within a business
model whose objective is to hold
assets for collecting contractual
cash flows, and

b) Contractual terms of the asset give
rise on specified dates to cash flows
that are solely payments of principal
and interest (SPPI) on the principal
amount outstanding.

After initial measurement, such
financial assets are subsequently
measured at amortised cost using the

effective interest rate (EIR) method.
Amortised cost is calculated by taking
into account any discount or premium
and fees or costs that are an integral
part of the EIR. The EIR amortisation
is included in finance income in
the Statement of Profit and Loss.
The losses arising from impairment are
recognised in the Statement of Profit
and Loss. This category generally
applies to trade and other receivables.

(ii) Debt instruments included within the
fair value through profit or loss (FVTPL)
category are measured at fair value with
all changes recognized in the Statement of
Profit and Loss.

(iii) Equity instruments

All equity instruments within the scope
of Ind AS 109 are measured at fair value.
Equity instruments which are classified
as held for trading are measured at
FVTPL. For all other equity instruments,
the Company decides to measure the
same either at fair value through other
comprehensive income (FVTOCI) or FVTPL
except investment in subsidiaries which is
valued at cost. The Company makes such
selection on an instrument-by-instrument
basis. The classification is made on initial
recognition and is irrevocable.

For equity instruments measured at
FVTOCI, all fair value changes on the
instrument, excluding dividends, are
recognized in other comprehensive income
(OCI). There is no recycling of the amounts
from OCI to Statement of Profit and Loss on
sale of such instruments.

iv) Equity instruments included within the
FVTPL category are measured at fair
value with all changes recognized in the
Statement of Profit and Loss.

C. De-recognition:

A financial asset (or, where applicable, a

part of a financial asset or part of a group

of similar financial assets) is primarily
derecognised (i.e. removed from the Company''s
balance sheet) when:

• the rights to receive cash flows from the asset
have expired, or

• the Company has transferred its rights to
receive cash flows from the asset or has
assumed an obligation to pay the received
cash flows in full without material delay
to a third party under a ''pass-through''
arrangement; and either:

(i) the Company has transferred substantially
all the risks and rewards of the asset, or

(ii) the Company has neither transferred nor
retained substantially all the risks and
rewards of the asset, but has transferred
control of the asset.

D. Impairment of financial assets:

In accordance with Ind AS 109, the Company
applies Expected Credit Loss (ECL) model for
measurement and recognition of impairment
loss on trade receivables and other advances.
The Company follows ''simplified approach'' for
recognition of impairment loss on these financial
assets. The application of simplified approach
does not require the Company to track changes
in credit risk. Rather, it recognises impairment
loss allowance based on lifetime ECLs at each
reporting date, right from its initial recognition.

II. Financial liabilities

A. Initial recognition and measurement:

Financial liabilities are classified at initial
recognition as:

(i) financial liabilities at fair value through
profit or loss,

(ii) loans and borrowings, payables, net of
directly attributable transaction costs or

(iii) derivatives designated as hedging
instruments in an effective hedge,
as appropriate.

The Company''s financial liabilities include trade
and other payables, loans and borrowings
including derivative financial instruments.

B. Subsequent measurement

The measurement of financial liabilities depends

on their classification, as described below:

(i) Borrowings

Borrowings are initially recognised at fair
value, net of transaction costs incurred.
Borrowings are subsequently measured at
amortised cost. Any difference between
the proceeds (net of transaction costs)
and the redemption amount is recognised
in the Statement of Profit and Loss over
the period of the borrowings using the
effective interest method. Fees paid on
the establishment of loan facilities are
recognised as transaction costs of the loan
to the extent that it is probable that some
or all of the facility will be drawn down.
In this case, the fee is deferred until the
draw down occurs.

Borrowings are removed from the Balance
Sheet when the obligation specified in the
contract is discharged, cancelled or expired.
The difference between the carrying
amount of a financial liability that has been
extinguished and the consideration paid is
recognised in the Statement of Profit and
Loss as other gains / (losses).

Borrowings are classified as current
liabilities unless the Company has an
unconditional right to defer settlement
of the liability for at least twelve months
after the reporting period. Where there is a
breach of a material provision of a long-term
loan arrangement on or before the end of
the reporting period with the effect that
the liability becomes payable on demand
on the reporting date, the entity does not
classify the liability as current, if the lender
has agreed, after the reporting period
and before the approval of the financial
statements for issue, not to demand
payment as a consequence of the breach.

(ii) Trade and other payables

These amounts represent liabilities for
goods and services provided to the Company
prior to the end of financial period which

are unpaid. The amounts are unsecured
and are usually paid within twelve months
of recognition. Trade and other payables
are presented as current liabilities unless
payment is not due within twelve months
after the reporting period. They are
recognised initially at their fair value and
subsequently measured at amortised cost
using the effective interest method.

(iii) Derivative financial instruments

The Company uses derivative financial
instruments, such as foreign exchange
forward contracts, currency options and
interest rate swaps to hedge its foreign
currency risks. Such derivative financial
instruments are initially recognised at fair
value on the date on which a derivative
contract isentered into and are subsequently
re-measured at fair value at the end of each
reporting period. Derivatives are carried
as financial assets when the fair value is
positive and as financial liabilities when the
fair value is negative.

Hedge accounting:

The Company designates certain hedging
instruments which include derivatives,
embedded derivatives and non-derivatives
in respect of foreign currency risk, as
either fair value hedges, cash flow hedges
or hedges of net investments in foreign
operations. At the inception of the hedge
relationship, the Company documents
the relationship between the hedging
instruments and the hedged item, along
with its risk management objectives and
its strategy for undertaking various hedge
transactions. Furthermore, at the inception
of the hedge and on an ongoing basis, the
Company documents whether the hedging
instrument is highly effective in offsetting
changes in fair values or cash flows of the
hedged item attributable to the hedged risk.

C. De-recognition

A financial liability is derecognised when the

obligation under the liability is discharged or

cancelled or expires. When an existing financial

liability is replaced by another, from the same

lender, on substantially different terms, or the
terms of an existing liability are substantially
modified, such an exchange or modification
is treated as the derecognition of the original
liability and the recognition of a new liability.
The difference in the respective carrying
amounts is recognised in the Statement of
Profit and Loss.

III. Offsetting of financial instruments

Financial assets and financial liabilities are offset,
and the net amount is reported in the balance sheet
if there is a currently enforceable legal right to offset
the recognised amounts and there is an intention to
settle on a net basis, to realise the assets and settle
the liabilities simultaneously.

Significant accounting judgements, estimates and
assumptions

The preparation of the Company''s financial
statements requires management to make
judgements, estimates and assumptions that affect
the reported amounts of revenues, expenses, assets
and liabilities, and the accompanying disclosures,
and the disclosure of contingent liabilities.
Uncertainty about these assumptions and estimates
could result in outcomes that require a material
adjustment to the carrying amount of assets or
liabilities affected in future periods.

Judgements

In the process of applying the Company''s accounting
policies, management has made the following

judgements, which have the most significant effect on
the amounts recognised in the financial statements:

(a) Operating lease commitments - Company
as lessor;

(b) Assessment of functional currency;

(c) Evaluation of recoverability of deferred tax assets

Estimates and assumptions

The following are the key assumptions concerning
the future, and other key sources of estimation
uncertainty at the end of the reporting period that
may have a significant risk of causing a material
adjustment to the carrying amounts of assets and
liabilities within the next financial year:

a) Useful lives of property, plant and equipment,
investment property and intangible assets;

b) Fair value measurements of financial
instruments ;

c) Impairment of non-financial assets;

d) Taxes;

e) Defined benefit plans (gratuity benefits);

f) Provisions;

g) Revenue recognition - Khazana Coupon
scheme, etc.

h) Valuation of inventories;

i) Contingencies


Mar 31, 2018

1 CORPORATE INFORMATION

Savita Oil Technologies Limited (“the Company”) is a Public Limited Company incorporated under the Companies Act, 1956 and domiciled in India. Its equity shares are listed on the Bombay Stock Exchange (BSE) and National Stock Exchange (NSE).

The Company is principally engaged in two segments, namely, manufacturing of petroleum speciality products and generation of electricity through wind power plants.

Authorization of financial statements

The standalone financial statements were authorized for issue in accordance with a resolution of the Board of Directors passed on 11th May, 2018.

Notes:

a) Buildings include cost of shares amounting to Rs.0.01 lacs [Previous year Rs.0.01 lacs).

b) Certain investment properties have been mortgaged for borrowing facilities availed by the Company (Refer Note 31).

The Company has no restrictions on the realisability of its investment properties or remittance of income and proceeds of disposal. Further, there are no contractual obligations to purchase, construct or develop investment properties or for repairs, maintenance and enhancements.

2.1 Fair value of the Company’s investment properties

The fair value of the Company’s investment properties as at 31st March, 2017 was arrived at on the basis of a valuation carried out by independent registered valuers not related to the Company. The Company has adopted policy of revaluing investment property generally every three years unless there are any significant changes in the circumstances requiring earlier revaluation. Accordingly, the Company has continued with the same valuation for the year ended 31st March, 2018.

c) Description of valuation techniques used and key inputs to valuation on investment properties

The investment properties have been valued at Fair Market Value. It is the value of the property at which it can be sold in open market at a particular time free from forced value or sentimental value. Prevailing market value is a result of demand / supply, merits / demerits of properties and various locational, social, economical, political factors and circumstances. Prevailing market value can be estimated through market survey, through dependable data / sale instances, local estate developers / brokers, real estate portal enquiries and verbal enquiries in neighbourhood area.

The entity has used a practical and expedient model for computing the expected credit loss allowance in respect of trade receivables based on a provision matrix. The provision matrix takes into account historical credit loss experience and is adjusted for forward-looking information. The expected credit loss allowance is based on the ageing of the days the receivables are due and the rates as given in the provision matrix. The provision matrix at the end of the reporting period is as follows :

b) Rights, preferences and restrictions attached to equity shares (except forfeited shares)

The Company has only one class of equity shares having par value of Rs.10 each. Each holder of equity shares is entitled to one vote per share. There are no restrictions on the distribution of dividend or repayment of capital. The Company declares dividend in Indian Rupees. 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.

As per the records of the Company, including its register of shareholders / members.

* Includes 93,18,408 [As at 31st March, 2017: 94,38,825) equity shares held as member of Association of Persons and HUFs, wherein Mr. Gautam N. Mehra is one of the beneficiaries, and as a trustee of family trusts, d) Buy-back of equity shares

During the year ended 31st March 2018, the Company purchased its own 2,80,000 equity shares of Rs.10 each at Rs.1,605 each resulting in cash outflow of Rs.4,494 lacs. The buy-back of these equity shares was completed by utilising its Security Premium Account and General Reserve to the extent of Rs.1,723.60 lacs and Rs.2,742.40 lacs respectively. The Company has transferred Rs.28 lacs, equal to the nominal value of such shares, to Capital Redemption Reserve account. Consequent to the buy-back of shares, the Paid-up Equity share capital of the Company stands reduced by Rs.28 lacs to Rs.1,432.21 lacs.

Notes:

Capital Reserve - Others : This reserve represents compensation received for breach of contract during the year 199495.

Securities Premium : Premium collected on issue of securities is accumulated as part of securities premium.

Utilisation of such premium is restricted by the Companies Act, 2013. During the current year, entire amount in Securities Premium account has been utilised for buy-back of equity shares.

Capital Redemption Reserve : This reserve is created u/s 69 of the Companies Act, 2013 by transferring an amount equal to the nominal value of shares bought back by the Company. The same is permitted to be used for issuing fully paid bonus shares.

General Reserve : General reserve forms part of the retained earnings and is permitted to be distributed to shareholders as dividend.

Retained Earning : This represents profits remaining after all appropriations. This is free reserve and can be used for distribution as dividend.

For details of carrying amounts of assets pledged / hypothecated for borrowing facilities, refer Note 31.

Details of Deferred Payment Liability

Deferred Payment Liabilities (without considering the present value) amounting to Rs.444.90 lacs (Previous year Rs.661.67 lacs] are interest free sales tax deferments repayable in 5 equal installments after 10 years from the respective year of availment.

3 The Company has spent Rs.22.02 lacs [Previous year Rs.46.10 lacs) towards Corporate Social Responsibility expenditure [including capital expenditure Rs. Nil, Previous year Rs. Nil] and debited the same to the Statement of Profit and Loss as against Rs.111.16 lacs (Previous year Rs.113.58 lacs) computed as per the provisions of section 135(5) of the Companies Act, 2013.

4 The Company’s application for waiver of excess remuneration of Rs.30.12 lacs paid to the Chairman and Managing Director for the year ended 31st March, E015 was rejected by Ministry of Corporate Affairs stating that the Company had failed to submit required information / documents. The Company has replied to the Ministry with evidence that all the information / documents requisitioned was / were furnished to the Ministry from time to time. Further response from the Ministry in this regard is awaited.

5 Disclosure of dues to Micro and Small Enterprises as defined under the Micro, Small and Medium Enterprises Development (MSMED) Act, 2006 (as available with the Company) (Refer Note 11.3)

6 COMMITMENTS

a) Estimated amount of contracts remaining to be executed on capital account and not provided for (net of advances) Rs.376.90 lacs (Previous year Rs.71.16 lacs).

b) The Company has set up wind power projects in the states of Maharashtra, Karnataka and Tamilnadu. The Company, in case of specific projects, has entered into agreements for sale of power exclusively to the state utility companies in the respective states, for periods varying from 13 to 20 years.

7 LEASES

The Company has entered into agreements for operating leases in respect of residential and office premises, plant and machinery and land taken / given on lease. All these leases are cancellable.

a) The lease expenditure I income recognised in the Statement of Profit and Loss :

Expenditure Rs.1,107.44 lacs (Previous year Rs.1,240.91 lacs)

Income Rs.153.66 lacs (Previous year Rs.168.75 lacs)

b) Under these agreements, refundable interest free deposits are given / taken except in case of land.

c) All these agreements have restriction on further leasing.

d) Agreements for office, factory premises and land provide for revision in the rent.

8 EMPLOYEE BENEFITS: (REFER NOTES 12 AND 21)

i] Defined Contribution Plan:

Company’s contribution to Provident Fund Rs.207.52 lacs (Previous year Rs.192.14 lacs).

The company also contributes to the following:

- National Pension Scheme (NPS) : Rs.29.58 lacs (Previous year Rs.17.69 lacs)

- Labour Welfare Fund : Rs.0.04 lacs (Previous year Rs.0.04 lacs)

ii) Defined Benefit Plan: The following table sets out the funded status of the Gratuity Plan and the amounts recognised in the Company’s financial statements:

9 DETAILS OF SEGMENT REPORTING:

A. Factors used to identify the entity’s reportable segments, including the basis of organisation

For management purposes, the Company is organised into segments based on the nature of products / services and has two reportable segments, as follows:

a] manufacturing of petroleum speciality products including transformer oils, white oils, mineral oils, liquid paraffins and lubricating oils;

b) electricity generation through wind power plants.

The Chairman and Managing Director (CMD) evaluates the Company’s performance and allocates resources based on an analysis of various performance indicators by operating segments. The CMD reviews revenue and gross profit as the performance indicator for all of the operating segments. However, the Company’s finance [including finance cost and finance income] and income taxes are managed on a company as a whole basis and are not allocated to any segment.

B. Information about reportable segments

10 FINANCIAL INSTRUMENTS : ACCOUNTING CLASSIFICATIONS AND FAIR VALUE MEASUREMENTS

(i) Accounting classifications

The fair values of the financial assets and liabilities are determined 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.

The following methods and assumptions were used to estimate the fair values:

The carrying amounts of trade receivables, cash and cash equivalents, bank balances, short term deposits, trade payables, payables for acquisition of property, plant and equipment, short term loans from banks, financial institutions and other current financial assets and liabilities are considered to be the same as their fair values, due to their short-term nature.

(ii) Fair value measurements

The Company uses the following hierarchy for determining and disclosing the fair value of financial instruments by valuation technique:

Level 1 — Quoted (unadjusted) market prices in active markets for identical assets or liabilities.

Level 2 — Valuation techniques for which the lowest level input that is significant to the fair value measurement is directly or indirectly observable.

Level 3 — Valuation techniques for which the lowest level input that is significant to the fair value measurement is unobservable. The following table presents carrying value and fair value of financial instruments by categories and also fair value hierarchy of assets and liabilities measured at fair value :

During the reporting period ending 31st March, 2018 and 31st March, 2017, there were no transfers between Level 1 and Level 2 fair value measurements and no transfer into and out of Level 3 fair value measurements.

(iii) Description of significant observable inputs to valuation:

The following table shows the valuation techniques used to determine fair value :

Type Valuation technique

Investments in equity shares (unquoted) Based on book value

Investment in mutual fund Based on NAV

Loan to employees Based on prevailing market interest rate

Loans from foreign banks Fair value based on prevailing exchange rate at each closing date

Discounted cash flows. The valuation model considers the present value of Interest-free sales tax deferral loans expected payments discounted using appropriate discounting rates.

Derivative instruments Based on quotes from banks and financial institutions

11 FINANCIAL RISK MANAGEMENT

Risk management framework

The Company has put in place Risk Management Policy, objectives of which are to optimize business performance, to promote confidence amongst the Company’s stakeholders in the effectiveness of its business management process and its ability to plan and meet its strategic objectives. The Company has a Risk Management Committee (RMC) comprising senior executives which is responsible for the review of risk management processes within the Company, and for overseeing the implementation of the requirements of this policy. The RMC provides updates to the Board on a regular basis on key risks faced by the Company, and the relevant mitigant actions. At an operational level, the respective functional managers are responsible for identifying and assessing risks within their area of responsibility; implementing agreed actions to treat such risks; and for reporting any event or circumstance that may result in new risks. The Company’s risk management system is fully aligned with the corporate and operational objectives.

The Board of Directors of the Company and the Audit Committee of Directors periodically review the Risk Management Policy of the Company so that the management controls the risks through properly defined network.

The Company has identified financial risks and categorised them in three parts viz. [i] Credit Risk, [ii] Liquidity Risk and [iii] Market Risk. Details regarding sources of risk in each such category and how Company manages the risk is explained in following notes:

(i) Credit risk

Credit risk refers to the possibility of a customer or other counterparties not meeting their obligations and terms and conditions which would result into financial losses. Such risk arises mainly from trade receivables and investments. Credit risk is managed through internal credit control mechanism such as credit approvals, establishing credit limits and continuously monitoring the credit worthiness of customers to which the Company grants credit terms in the normal course of business. The Company establishes an allowance for doubtful debts and impairment that represents its estimate of incurred losses in respect of trade and other receivables and investments. The maximum exposure to credit risk in case of all the financial instruments covered below is restricted to their respective carrying amount.

Trade receivables

The Company’s exposure to credit risk is influenced mainly by the following:

Petroleum Products Segment - As per the credit policy of the Company, generally no credit are given exceeding the accepted credit norms. The Company deals with State Electricity Boards and large corporate houses after considering their credit standing. The credit policy with respect to other customers is strictly monitored by the Company at periodic intervals. Credit risk is managed through credit approvals, establishing credit limits and continuously monitoring the credit worthiness of customers. In addition, for amounts recoverable on exports, the Company has adequate insurance to mitigate overseas customer and country risk. Wind Energy Segment - Since the sale of wind energy is mostly to State Electricity Boards and reputed private big corporates mostly against performance bank guarantees, the Company is of the view that the risk is highly mitigated.

As at 31.3.2018, the Company’s most significant customer accounted forRs. 3,344.26 lacs of the trade receivables carrying amount (Previous year Rs.2,700.30 lacs).

The Company uses an allowance matrix to measure the expected credit losses of trade receivables (which are considered good). The following table provides information about the exposure to credit risk and loss allowance (including expected credit loss provision) for trade receivables:

Cash and cash equivalents

The Company held cash and cash equivalents of Rs.2,326.34 lacs at 31.3.2018 (Previous year Rs.1,049.66 lacs). The cash and cash equivalents are held with banks with good credit ratings.

Derivatives

The option contracts, forwards and interest rate swaps were entered into with banks having an investment grade rating and exposure to counterparties is closely monitored and kept within the approved limits.

Investments

The Company invests its surplus funds mainly in liquid schemes of mutual funds, which carry no / low mark to market risks for short duration and therefore, does not expose the Company to credit risk. Such investments are made after reviewing the credit worthiness and market standing of such funds and therefore, does not expose the Company to credit risk. Such investments are monitored on a regular basis.

Security Deposit

The Company has taken premises on lease and has paid security deposits. Since the Company has the ability to adjust the deposit with future lease payments, therefore, does not expose the Company to credit risk.

(ii) Liquidity risk

Liquidity risk is the risk that the Company will not be able to meet its financial obligations on due date. The Company has a strong focus on effective management of its liquidity to ensure that all business and financial commitments are met on time. This is ensured through proper financial planning with detailed annual business plans, discussed at appropriate levels within the organisation. Annual business plans are divided into quarterly plans and put up to management for detailed discussion and an analysis of the nature and quality of the assumptions, parameters etc. Daily and monthly cash flows are prepared, followed and monitored at senior levels to prevent undue loss of interest and utilise cash in an effective manner. Cash management services are availed to avoid any loss of interest on collections. In addition, the Company has adequate, duly approved borrowing limits in place with reputed banks.

a) Financing arrangements

The Company has an adequate fund and non-fund based limits lines with various banks. The Company’s diversified source of funds and strong operating cash flow enables it to maintain requisite capital structure discipline. The financing products include working capital loans, buyer’s credit loan, External Commercial Borrowings (ECB) Loans etc.

b] Maturities of financial liabilities

The amounts disclosed in the table are the contractual undiscounted cash flows

(iii) Market Risk

The risk that the fair value or future cash flows of financial instruments will fluctuate because of changes in market price. Market risk further comprises of (a) Currency risk, (b) Interest rate risk and (c) Commodity risk.

a) Currency Risk

The Company is exposed to currency risk mainly on account of its import payables, External Commercial Borrowing (ECB) and export receivables in foreign currency. The major exposures of the Company are in U.S. dollars. The Company hedges its import foreign exchange exposure partly through exports and depending upon the market situations partly through options and forward foreign currency contracts. The Company has a policy in place for hedging its foreign currency borrowings along with interest. The Company does not use derivative financial instruments for trading or speculative purposes.

Following are the derivative financial instruments to hedge the foreign exchange rate risk as of dates:

Sensitivity analysis

The table below shows sensitivity of open forex exposure to USD IINR movement. We have considered 1% [ 1 -] change in USD I INR movement, increase indicates appreciation in USD / INR whereas decrease indicates depreciation in USD / INR. The indicative 1% movement is directional and does not reflect management forecast on currency movement.

b) Interest rate risk

Interest rate risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market interest rates. The Company manages its cash flow interest rate risk by using floating-to-fixed interest rate swaps. Under these swaps, the Company agrees with other parties to exchange, at specified intervals [i.e. quarterly], the difference between fixed contract rates and floating rate interest amounts calculated by reference to the agreed notional principal amounts. The management also maintains a portfolio mix of floating and fixed rate debt. Borrowings issued at variable rates expose the Company to cash flow interest rate risk.

The Company is not exposed to significant interest rate risk during the respective reporting periods.

Following is the outstanding derivative financial instruments to hedge currency and the interest rate risk as of dates

Interest rate risk exposure:

Company’s interest rate risk arises from borrowings. The interest rate profile of the Company’s interest-bearing financial instruments as reported to the management of the Company is as follows:

Cash flow sensitivity analysis for variable-rate instruments

A reasonably possible change of 25 basis points in interest rates at the reporting date would have increased I [decreased] profit or loss by the amounts shown below. The indicative 25 basis point [0.25%] movement is directional and does not reflect management forecast on interest rate movement.

c) Commodity Risk Raw Material Risk

Petroleum Products Segment - Timely availability and also non-availability of good quality base oils from across the globe could negate the qualitative and quantitative production of various products of the Company. Volatility in prices of crude oil and base oil is another major risk for this segment. The Company procures base oils from various suppliers scattered in different parts of the world. The Company tries to enter into long term supply contracts with regular suppliers and at times buys base oils on spot basis.

Wind Energy Segment - Availability of good windy sites, delays in land acquisitions and forest land approvals, right of way issues, weak Renewal Purchase Obligation enforcement, resistance to Open Access by State Electricity Boards, lack of adequate transmission infrastructure can effect the decisions to invest and to operate this segment. The Company tries its best to carry out a thorough feasibility study before embarking on investment in this segment. The Company also explores the possibility of scattering its investments over various states and over a period of time.

Capital management

The Company’s policy is to maintain a strong capital base so as to maintain investor, creditor and market confidence and to sustain future development of the business. Management monitors the return on capital as well as the level of dividends to ordinary shareholders.

i) Debt Equity Ratio

The Company monitors capital using debt equity ratio. The Company’s debt to equity ratios are as follows:

12 Previous year’s figures have been regrouped I rearranged wherever necessary to conform to those of current year classification.


Mar 31, 2017

Significant accounting judgments, estimates and assumptions

The preparation of the Company''s financial statements requires management to make judgments, estimates and assumptions that affect the reported amounts of revenues, expenses, assets and liabilities and the accompanying disclosures, and the disclosure of contingent liabilities. Uncertainty about these assumptions and estimates could result in outcomes that require a material adjustment to the carrying amount of assets or liabilities affected in future periods.

Judgments

In the process of applying the Company''s accounting policies, management has made the following judgments, which have the most significant effect on the amounts recognized in the financial statements:

(a) Operating lease commitments - Company as less or;

(b) Assessment of functional currency;

(c) Evaluation of recoverability of deferred tax assets Estimates and assumptions

The following are the key assumptions concerning the future and other key sources of estimation uncertainty at the end of the reporting period that may have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year :

a) Useful lives of property, plant and equipment, investment property and intangible assets;

b) Fair value measurements of financial instruments ;

c) Impairment of non-financial assets;

d) Taxes;

e) Defined benefit plans (gratuity benefits);

f) Provisions;

g) Revenue recognition - Khazana Coupon scheme, etc.

h) Valuation of inventories;

i) Contingencies

Notes:

a) Buildings include cost of shares amounting to Rs, 0.01 lacs (as at 31.3.2016 Rs, 0.01 lacs and as at 1.4.2015 Rs, 0.01 lacs).

b) Certain Investment Properties have been mortgaged for borrowing facilities availed by the Company (Refer Note 31).

4.1 For investment property existing as on 1st April, 2015 i.e. date of transition to Ind AS, the Company has used Indian GAAP carrying value as deemed cost.

4.2 Information regarding income and expenditure of Investment Property

The management has determined that the investment properties consist of two classes of assets - Commercial and residential - based on the nature, characteristics and risks of each property.

The Company has no restrictions on the reliability of its investment properties and no contractual obligations to purchase, construct or develop investment properties or for repairs, maintenance and enhancements.

4.3 Fair value of the Company''s investment properties

The fair value of the Company''s investment properties as at 31st March, 2017, 31st March, 2016 and 1st April, 2015 have been arrived at on the basis of a valuation carried out by independent registered valuers not related to the Company.

4.4 a) Details of the Company''s investment properties and information about their fair value hierarchy

c) Description of valuation techniques used and key inputs to valuation on investment properties

The Investment properties have been valued at Fair Market Value. It is value of the property at which it can be sold in open market at a particular time free from forced value or sentimental value. Prevailing market value is a result of demand / supply, merits / demerits of properties and various vocational, social, economical, political factors and circumstances. Prevailing market value can be estimated through market survey, through dependable data / sale instances, local estate developers / brokers, real estate portal enquiries and verbal enquiries in neighborhoods area.

The entity has used a practical expedient by computing the expected credit loss allowance for trade receivables based on a provision matrix. The provision matrix takes into account historical credit loss experience and adjusted for forward-looking information. The expected credit loss allowance is based on the ageing of the days the receivables are due and the rates as given in the provision matrix. The provision matrix at the end of the reporting period is as follows :

b) Rights, preferences and restrictions attached to equity shares (except forfeited shares)

The Company has only one class of equity shares having par value of '' 10 each. Each holder of equity shares is entitled to one vote per share. There are no restrictions on the distribution of dividend or repayment of capital. The Company declares dividend in Indian Rupees. 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.

As per the records of the Company, including its register of shareholders / members.

* Includes 94,38,825 (As at 31st March, 2016: 94,38,825; as at 1st April, 2015: 94,37,325) equity shares held as member of Association of Persons and HUFs, wherein he is one of the beneficiaries, and as a trustee of family trusts.

During the year the board of directors have decided to cancel the 7,100 forfeited shares. Accordingly, an amount of ''0.35 lacs received against such shares has been transferred to Capital Reserve.

Notes :

Capital Reserve : This reserve represents compensation received for breach of contract during the year 1994-95.

Securities Premium : Premium collected on issue of securities are accumulated as part of securities premium. Utilization of such reserve is restricted by The Companies Act, 2013.

General Reserve : General reserve forms part of the retained earnings and is permitted to be distributed to shareholders as dividend.

Retained Earnings : This represents profits remaining after all appropriations. This is free reserve and can be used for distribution of profits.

Note:

In terms of the scheme of Government of Maharashtra, the Company was entitled to defer the payment of sales tax liability in certain years. Such deferral is without payment of interest. The grant represents the difference between the carrying amount as on the date of transition and the present value. The grant income is recognized in the statement of profit and loss on a systematic basis.

25 The Company has spent Rs, 46.10 lacs (Previous year Rs, 14.00 lacs) towards Corporate Social Responsibility expenditure (including capital expenditure Rs, Nil, Previous year Rs, Nil) and debited the same to the Statement of Profit and Loss as against Rs, 113.58 lacs computed as per the provisions of section 135(5) of the Companies Act, 2013.

26 The Company has filed an application with the Central Government seeking their approval for waiver of excess remuneration of Rs, 30.12 lacs paid to the Chairman and Managing Director for the year ended 31st March, 2015, approval for which is awaited.

27 Disclosure of dues to Micro and Small Enterprises as defined under the Micro, Small and Medium Enterprises Development (MSMED) Act, 2006 (as available with the Company) (Refer Note 11.3)

29 Commitments

a) Estimated amount of contracts remaining to be executed on capital account and not provided for (net of advances) Rs, 71.16 lacs (as at 31.3.2016 Rs, 218.38 lacs and as at 1.4.2015 Rs, 465.85 lacs).

b) The Company has set up wind power projects in the states of Maharashtra, Karnataka and Tamilnadu. The Company, in case of specific projects, has entered into agreements for sale of power exclusively to the state utility companies in the respective states, for periods varying from 13 to 20 years.

30 Leases

The Company has entered into agreements for operating leases in respect of residential and office premises, plant and machinery and land taken / given on lease. All these leases are cancellable.

a) The lease expenditure / income recognized in the Statement of Profit and Loss :

Expenditure Rs, 1,240.91 lacs (Previous year Rs, 992.23 lacs)

Income Rs, 168.75 lacs (Previous year Rs, 157.40 lacs)

b) Under these agreements, refundable interest free deposits are given / taken except in case of land.

c) All these agreements have restriction on further leasing.

d) Agreements for office, factory premises and land provide for revision in the rent.

33 Details of related party transactions in accordance with Ind AS 24 Rs,Related Party Disclosures''

Controlled by: Mr. G. N. Mehra Key Management Personnel:

Mr. G. N. Mehra Mr. C. V. Alexander Mr. S. R. Pandit

Mr. H. A. Nagpal Mr. N. B. Karpe Mrs. M. C. Dalal

Mr. S. M. Dixit Mr. U. C. Rege

Enterprises where key management personnel or relatives of key management personnel have control or significant influence:

Basant Lok Trading Co. Chemi Pharmex Pvt. Ltd D. C. Mehra Public Charitable Trust

Khatri Investments Pvt. Ltd. Kurla trading Co. Pvt. Ltd. Madhu Trust

Mansukhmal Investment Pvt. Ltd. N. K. Mehra Trust Naved Investment & Trading Co. Pvt. Ltd.

NKM Grand Children''s Trust Savita Petro-Additives Ltd. Savita Polymers Ltd.

Relatives of key management personnel and relationship

Mrs. R. G. Mehra - Wife Ms. S. G. Mehra - Daughter Mr. S. G. Mehra - Son

34 Details of Segment Reporting:

A. Factors used to identify the entity''s reportable segments, including the basis of organization

For management purposes, the Company is organized into segments based on the type of business / products and has two reportable segments, as follows:

a) manufacturing of petroleum specialty products including transformer oils, white oils, mineral oils, liquid paraffins and lubricating oils;

b) electricity generation through wind power plants.

The Chairman and Managing Director (CMD) evaluates the Company''s performance and allocates resources based on an analysis of various performance indicators by operating segments. The CMD reviews revenue and gross profit as the performance indicator for all of the operating segments. However, the Company''s finance (including finance cost and finance income) and income taxes are managed on a company as a whole basis and are not allocated to any segment.

36 Financial Instruments : Accounting classifications and fair value measurements

(i) Accounting classifications

The fair values of the financial assets and liabilities are determined 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.

The following methods and assumptions were used to estimate the fair values:

The carrying amounts of trade receivables, cash and cash equivalents, bank balances, short term deposits, trade payables, payables for acquisition of property, plant and equipment, short term loans from banks, financial institutions and other current financial assets and liabilities are considered to be the same as their fair values, due to their short-term nature.

(ii) Fair value measurements

The Company uses the following hierarchy for determining and disclosing the fair value of financial instruments by valuation technique:

Level 1 — Quoted (unadjusted) market prices in active markets for identical assets or liabilities.

Level 2 — Valuation techniques for which the lowest level input that is significant to the fair value measurement is directly or indirectly observable.

Level 3 — Valuation techniques for which the lowest level input that is significant to the fair value measurement is unobservable.

(iii) Description of significant observable inputs to valuation:

The following table shows the valuation techniques used to determine fair value :

Type Valuation technique

Investments in equity shares (unquoted) Book value

Investment in mutual fund Based on NAV

Loan to employees Based on prevailing market interest rate

Loans from foreign banks Fair valued based on prevailing exchange rate at each closing date

Discounted cash flows. The valuation model considers the present value

Interest-free sales tax deferral loans of expected payments discounted using appropriate discounting rates.

Derivative instruments Based on quotes from banks and financial institutions

37 Disclosure on Specified Bank Notes (SBNs)

During the year, the Company had specified bank notes or other denomination notes as defined in the MCA notification G.

S. R. 308(E) dated 30th March, 2017 on the details of Specified Bank Notes (SBN) held and transacted during the period from 8th November, 2016 to 30th December, 2016, the denomination wise SBNs and other notes as per notification is given below:

* For the purpose of this clause, the term Specified Bank Notes shall have the same meaning provided in the notification of the Government of India, in the Ministry of Finance, Department of Economic Affairs number S. O. 3407(E), dated 8th November, 2016.

Note: Above does not include direct deposit by customers amounting to '' 4.00 lacs in Company''s bank account.

38 Financial risk management

Risk management framework

The Company has put in place Risk Management Policy, objectives of which are to optimize business performance, to promote confidence amongst the Company''s stakeholders in the effectiveness of its business management process and its ability to plan and meet its strategic objectives. The Company has a Risk Management Committee (RMC) comprising senior executives which is responsible for the review of risk management processes within the Company, and for overseeing the implementation of the requirements of this policy. The RMC provides updates to the Board on a regular basis on key risks faced by the Company and the relevant mitigant actions. At an operational level, the respective functional managers are responsible for identifying and assessing risks within their area of responsibility, implementing agreed actions to treat such risks and for reporting any event or circumstance that may result in new risks. The Company''s risk management system is fully aligned with the corporate and operational objectives.

The Board of Directors of the Company and the Audit Committee of Directors periodically review the Risk Management Policy of the Company so that the management controls the risks through properly defined network.

The Company has identified financial risks and categorized them in three parts viz. (i) Credit Risk, (ii) Liquidity Risk and (iii) Market Risk. Details regarding sources of risk in each such category and how Company manages the risk is explained in following notes:

(i) Credit risk

Credit risk refers to the possibility of a customer and other counterparties not meeting their obligations and terms and conditions which would result into financial losses. Such risk arises mainly from trade receivables and investments. Credit risk is managed through internal credit control mechanism such as credit approvals, establishing credit limits and continuously monitoring the credit worthiness of customers to which the Company grants credit terms in the normal course of business. The Company establishes an allowance for doubtful debts and impairment that represents its estimate of incurred losses in respect of trade and other receivables and investments. The maximum exposure to credit risk in case of all the financial instruments covered below is restricted to their respective carrying amount.

Trade receivables

The Company''s exposure to credit risk is influenced mainly by the following:

Petroleum Products Segment - As per the credit policy of the Company, generally no credit are given exceeding the accepted credit norms. The Company deals with State Electricity Boards and large corporate houses after considering their credit standing. The credit policy with respect to other customers is strictly monitored by the Company at periodic intervals. Credit risk is managed through credit approvals, establishing credit limits and continuously monitoring the credit worthiness of customers. In addition, for amounts recoverable on exports, the Company has adequate insurance to mitigate overseas customer and country risk.

Wind Energy Segment - Since the sale of wind energy is mostly to State Electricity Boards and reputed private big corporate mostly against performance bank guarantees, the Company is of the view that the risk is highly mitigated.

As at 31.3.2017, the Company''s most significant customer accounted for Rs, 2,700.30 lacs of the trade receivables carrying amount (31.3.2016 :Rs, 3,086.50 lacs and 1.4.2015 : Rs, 3,274.59 lacs).

The Company uses an allowance matrix to measure the expected credt losses of trade receivables (which are considered good). The following table provides information about the exposure to credit risk and loss allowance (including expected credit loss provision) for trade receivables:

Note - Expected credit loss is worked out on the trade receivable for which no specific provision is made.

Cash and cash equivalents

The Company held cash and cash equivalents of Rs, 1,049.66 lacs at 31.3.2017 (31.3.2016: Rs, 1,444.67 lacs, 1.4.2015 : Rs, 1,606.93 lacs). The cash and cash equivalents are held with banks with good credit ratings. Also, the Company invests its surplus funds in bank fixed deposits and liquid schemes of mutual funds, which carry no / low mark to market risks for short duration and therefore, does not expose the Company to credit risk.

Derivatives

The option contracts, forwards and interest rate swaps were entered into with banks having an investment grade rating and exposure to counterparties is closely monitored and kept within the approved limits.

Investments

The Company invests its surplus funds mainly in liquid schemes of mutual funds, which carry no / low mark to market risks for short duration and therefore, does not expose the Company to credit risk. Such investments are made after reviewing the credit worthiness and market standing of such funds and therefore, does not expose the Company to credit risk. Such investments are monitored on a regular basis.

Security Deposit

The Company has taken premises on lease and has paid security deposit. Since the Company has the ability to adjust the deposit with future lease payments, therefore, does not expose the Company to credit risk.

(ii) Liquidity risk

Liquidity risk is the risk that the Company will not be able to meet its financial obligations on due date. The Company has a strong focus on effective management of its liquidity to ensure that all business and financial commitments are met on time. This is ensured through proper financial planning with detailed annual business plans, discussed at appropriate levels within the organisation. Annual business plans are divided into quarterly plans and put up to management for detailed discussion and an analysis of the nature and quality of the assumptions, parameters etc. Daily and monthly cash flows are prepared, followed and monitored at senior levels to prevent undue loss of interest and utilise cash in an effective manner. Cash management services are availed to avoid any loss of interest on collections. In addition, the Company has adequate borrowing limits with reputed banks in place duly approved.

a) Financing arrangements

The Company has an adequate fund and non-fund based limits lines with various banks. The Company''s diversified source of funds and strong operating cash flow enables it to maintain requisite capital structure discipline. The financing products include working capital loans, buyer''s credit loan, External Commercial Borrowings (ECB) Loans etc.

(iii) Market Risk

The risk that the fair value or future cash flows of financial instruments will fluctuate because of changes in market price. Market risk further comprises of (a) Currency risk , (b) Interest rate risk and (c) Commodity risk.

a) Currency Risk

The Company is exposed to currency risk mainly on account of its import payables, External Commercial Borrowing (ECB) and export receivables in foreign currency. The major exposures of the Company are in U.S. dollars. The Company hedges its import foreign exchange exposure partly through exports and depending upon the market situations partly through options and forward foreign currency covers. The Company has a policy in place for hedging its foreign currency borrowings along with interest. The Company does not use derivative financial instruments for trading or speculative purposes.

Following are the derivative financial instruments to hedge the foreign exchange rate risk as of dates:

Sensitivity analysis

The table below shows sensitivity of open forex exposure to USD / INR movement. We have considered 1% ( /-) change in USD / INR movement, increase indicates appreciation in USD / INR whereas decrease indicates depreciation in USD / INR. The indicative 1% movement is directional and does not reflect management forecast on currency movement.

b) Interest rate risk

Interest rate risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market interest rates. The Company manages its cash flow interest rate risk by using floating-to-fixed interest rate swaps. Under these swaps, the Company agrees with other parties to exchange, at specified intervals (i.e. quarterly), the difference between fixed contract rates and floating rate interest amounts calculated by reference to the agreed notional principal amounts. The management also maintains a portfolio mix of floating and fixed rate debt. Borrowings issued at variable rates expose the Company to cash flow interest rate risk.

The Company is not exposed to significant interest rate risk during the respective reporting periods.

Following is the outstanding derivative financial instruments to hedge currency and the interest rate risk as of dates

Cash flow sensitivity analysis for variable-rate instruments

A reasonably possible change of 25 basis points in interest rates at the reporting date would have increased / (decreased) profit or loss by the amounts shown below. The indicative 25 basis point (0.25%) movement is directional and does not reflect management forecast on interest rate movement.

This analysis assumes that all other variables, in particular foreign currency exchange rates, remain constant.

c) Commodity Risk Raw Material Risk

Petroleum Products Segment - Timely availability and also non-availability of good quality base oils from across the globe could negate the qualitative and quantitative production of the various products of the Company. Volatility in prices of crude oil and base oil is another major risk for this segment. The Company procures base oils from various suppliers scattered in different parts of the world. The Company tries to enter into long term supply contracts with regular suppliers and at times buys the base oils on spot basis.

Wind Energy Segment - Availability of good windy sites, delays in land acquisitions and forest land approvals, right of way issues, weak RPO enforcement, resistance to Open Access by State Electricity Boards, lack of adequate transmission infrastructure can affect the decisions to invest and to operate this segment. Company tries its best to carry out a thorough feasibility study before embarking on investment in this segment. The Company also explores the possibility of scattering its investments over various states and over a period of time.

Capital management

The Company''s policy is to maintain a strong capital base so as to maintain investor, creditor and market confidence and to sustain future development of the business. Management monitors the return on capital as well as the level of dividends to ordinary shareholders.

39 First time adoption of Ind AS

39.1 Mandatory exceptions, optional exemptions Transition to Ind AS

These are the Company''s first financial statements prepared in accordance with Ind AS. For the year ended 31st March, 2016, the Company had prepared its financial statements in accordance with Companies (Accounting Standards) Rules, 2014, notified under Section 133 of the Companies Act, 2013 and other relevant provisions of the Act (''IGAAP''). The accounting policies set out in Note 2 have been applied in preparing these Financial Statements for the year ended 31st March, 2016 and the opening Ind AS Balance Sheet on the date of transition (i.e. 1st April, 2015). In preparing its Ind AS Balance Sheet as at 1st April, 2015 and in presenting the comparative information for the year ended 31st March, 2016, the Company has adjusted amounts previously reported in the Financial Statements prepared in accordance with IGAAP. This note explains the principal adjustments made by the Company in restating its Financial Statements prepared in accordance with IGAAP, and how the transition from IGAAP to Ind AS has impacted the Company financial position, financial performance and cash flows.

Exemptions and exceptions availed

In preparing the Financial Statement, the Company has availed the below mentioned optional exemptions and mandatory exceptions.

A. Exceptions :

1 Classification and measurement of financial assets

As permitted under Ind AS 101, the Company has determined the classification of financial assets based on facts and circumstances that exist on the date of transition. In line with Ind AS 101, measurement of financial assets accounted at Amortized cost has been done retrospectively except where the same is impracticable.

2 Estimates

Ind AS estimates as at 1st April, 2015 are consistent with the estimates as at the same date made in conformity with IGAAP. Company has made estimates for following items in accordance with Ind AS at the date of transition as these were not required under IGAAP:

- investment in equity instruments carried at FVTPL;

- impairment of financial assets based on expected credit loss model;

- determination of the discounted value for financial instruments carried at Amortized cost.

3 Government Grant

The Company has elected to apply the requirements in Ind AS 109 and Ind AS 20 prospectively to government loans existing at the date of transition to Ind AS and has not recognized the corresponding benefit of the government loan at a below-market rate of interest as a government grant as on date of transition. Consequently, the Company has used its previous GAAP carrying amount of the loan at the date of transition to Ind AS as the carrying amount of the loan in the opening Ind AS Balance Sheet.

B. Optional exemptions :

Property, plant and equipment and intangible assets

The Company has availed the exemption available under Ind AS 101 to continue the carrying value for all of its property, plant and equipment and intangible assets as recognized in the Financial Statements as at the date of transition to Ind AS, measured as per the IGAAP and use that as its deemed cost as at the date of transition (1st April, 2015).

1 Property, plant and equipment: Under previous GAAP, there was no requirement to present investment property separately and the same was included under tangible fixed assets (buildings) and measured at cost less accumulated depreciation. Under Ind AS, investment property is required to be presented separately in the balance sheet and depreciation is charged on it. Accordingly, the carrying amount of investment property as at 1st April, 2015 of Rs, 1,188.63 lacs and as at 31st March, 2016 of Rs, 67.70 lacs (before considering depreciation) under previous GAAP has been reclassified to a separate line item on the face of the balance sheet. There is no impact on the statement of profit and loss.

2 Leases : As per Ind AS, a test for leases is carried out and leasehold land having carrying value of Rs, 312.23 lacs as at 1st April, 2015, is treated as operating lease. The same is reclassified under other assets as advance lease rentals. The net effect of the same on total equity as at 1st April, 2015 is NIL and a decrease in the depreciation on tangible assets of Rs, 10.01 lacs and increase in lease rental expenses of Rs, 10.01 lacs, resulting in Nil impact on profit before tax for the year ended 31st March, 2016.

3 Fair valuation of investments: Under previous GAAP, long term investments were measured at cost less diminution in the value which is other than temporary. Under Ind AS, these assets are classified as financial assets measured at fair value through profit or loss (FVTPL). On the date of transition to Ind AS, these financial assets have been measured at their fair value which is higher than the cost as per previous GAAP, resulting in an increase in the carrying amount by Rs, 90.04 lacs as at 1st April, 2015 and by Rs, 97.20 lacs as at 31st March, 2016. The corresponding deferred taxes have also been recognized as at 1st April, 2015 and as at 31st March, 2016. The result of these changes is an increase in total equity as at 1st April, 2015 Rs, 90.04 lacs, increase in profit before tax by Rs, 7.14 lacs for the year ended 31st March, 2016.

Under previous GAAP, current investments were measured at lower of cost or fair value. Under Ind AS, these assets are classified as financial assets measured at FVTPL. On the date of transition to Ind AS, these financial assets have been measured at their fair value which is higher than the cost as per previous GAAP, resulting in an increase in the carrying amount by Rs, 4.52 lacs as at 1st April, 2015 and by Rs, 4.09 lacs as at 31st March, 2016. The corresponding deferred taxes have also been recognized as at 1st April, 2015 and as at 31st March, 2016. The result of these changes is an increase in total equity as at 1st April, 2015 by Rs, 4.52 lacs, increase in profit before tax by Rs, 0.45 lacs for the year ended 31st March, 2016.

4 Stores and spares: Under previous GAAP, stores and spares were shown under inventories. Under Ind AS, the items which fit the criteria given under Ind AS 16 are reclassified as property, plant and equipments from inventories and depreciation is charged on the same. On the date of transition to Ind AS, stores and spares having carrying value of Rs, 6.37 lacs have been capitalized. The corresponding deferred taxes have also been recognized as at 1st April, 2015 and as at 31st March, 2016. The result of these changes is a decrease in total equity as at 1st April, 2015 by Rs, 1.15 lacs, an increase in the depreciation leading to decrease in profit before tax by Rs, 1.15 lacs.

5 Trade receivables: Under Indian GAAP, the Company has created provision for impairment of receivables only in respect of specific amount for incurred losses. Under Ind AS, impairment allowance has been determined based on Expected Credit Loss (ECL) model. Due to ECL model, the Company impaired its trade receivable by Rs, 433.69 lacs on 1st April, 2015 which has been eliminated against retained earnings. The impact of Rs, 330.42 lacs for year ended on 31st March, 2016 has been recognized in the statement of profit and loss. Moreover, all trade receivables are now classified as current financial assets as per Ind AS.

6 Derivative instruments: Under previous GAAP, foreign exchange loss on option contracts was recognized ignoring the gains and gains or losses on forward contracts were recognized. As per Ind AS, gains or losses on all option and forward contracts are recognized at fair value based on bankRs,s mark to market certificates. As a result, derivative asset of Rs, 804.01 lacs and liability of Rs, 3.21 lacs is created as at 1st April, 2015, and derivative asset of Rs, 590.73 lacs and liability of Rs, 19.82 lacs is created as 31st March, 2016 under other financial assets or liabilities.

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

8 Dividend (including dividend tax): Under previous GAAP, proposed dividends including Dividend Distribution Tax (DDT) are recognized as a liability in the period to which they relate, irrespective of when they are declared. Under Ind AS, a proposed dividend is recognized as a liability in the period in which it is declared by the company (usually when approved by shareholders in a general meeting) or paid. In the case of the company, the declaration of dividend occurs after period end. Therefore, the short term provision of Rs, 438.04 lacs (including DDT) for the year ended on 31st March, 2015 recorded for dividend has been derecognized against retained earnings on 1st April, 2015. There was no proposed dividend for the year ended 31st March, 2016 as the company had declared and paid interim dividend and the same was treated as full and final dividend.

9 Employee benefits: Both under Indian GAAP and Ind AS, the Comapny recognized costs related to its post-employment defined benefit plan on an actuarial basis. Under Indian GAAP, the entire cost, including actuarial gains and losses, are charged to profit or loss. Under Ind AS, remeasurements are to be recognized under other comprehensive income. Consequently, the tax effect of the same has also been recognized in other comprehensive income under Ind AS instead of profit or loss. On the date of transition, this change does not affect total equity. For the year ended 31st March, 2016, the employee benefit expenses are reduced by Rs, 115.74 lacs and are recognized under other comprehensive income (net of deferred tax).

10 Deferred tax: Indian 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. The application of Ind AS 12 approach has resulted in recognition of deferred tax on new temporary differences which was not required under Indian GAAP. In addition, the various transitional adjustments lead to temporary differences. According to the accounting policies, the Company has to account for such differences. Deferred tax adjustments are recognized in co-relation to the underlying transaction either in retained earnings or a separate component of equity. On the date of transition, the net impact on deferred tax assets is of Rs, 327.79 lacs with corresponding impact on retained earning. For the year ended 31st March, 2016, deferred tax expenses are reduced by Rs, 398.63 lacs.

11 Revenue: Under previous GAAP, revenue from sale of products was presented net of excise duty under revenue from operations. Whereas, under Ind AS, revenue from sale of products includes excise duty. The corresponding excise duty expense is presented on the face of the statement of profit and loss. The change does not affect total equity as at 1st April, 2015 and 31st March, 2016, profit before tax or total profit for the year ended 31st March, 2016.

12 Government Grant: Under previous GAAP, there was no specific guidance on accounting for government loan at below market rate of interest. Hence, these were recognized and carried at the amount of the proceeds received. Under Ind AS, the benefit of a government loan at a below market rate of interest is treated as a government grant, measured as the difference between proceeds received and the initial fair value. On the transition date, there is an exception to retrospective application of Ind AS 20, thus no impact. For the year ended 31st March, 2016, there is an increase in other income as grant income by Rs, 81.14 lacs with a corresponding debit to deferred grant and increase in interest expense by Rs, 81.14 lacs with a corresponding credit to sales tax deferment loan. The corresponding deferred taxes has also been recognized as at 31st March, 2016.

13 As per Ind AS, cash and cash equivalents are shown as a separate item and other bank balances are shown separately.

14 As per Ind AS, certain assets and liabilities are reclassified as financial assets or liabilities based on the recognition criteria for financial asset or financial liability.


Mar 31, 2016

1. The Company has spent Rs. 14.00 lacs (Previous year Rs.2.61 lacs) towards Corporate Social Responsibility expenditure (including capital expenditure Rs.Nil, Previous year Rs.Nil) and debited the same to the Statement of Profit and Loss as against Rs.184.76 lacs computed as per the provisions of section 135(5) of the Companies Act, 2013.

2. The Company has filed an application with the Central Government seeking their approval for waiver of excess remuneration of Rs. 30.12 lacs paid to the Chairman and Managing Director for the year ended 31st March 2015, approval for which is awaited.

3. Commitments

a) Estimated amount of contracts remaining to be executed on capital account and not provided for (net of advances) Rs. 218.38 lacs (Previous year Rs. 465.85 lacs).

b) The Company has set up wind power projects in the states of Maharashtra, Karnataka and Tamilnadu. The Company, in case of specific projects, has entered into agreements for sale of power exclusively to the state utility companies in the respective states, for periods varying from 13 to 20 years.

4. Leases

The Company has entered into agreements for operating leases in respect of residential, office, plant and machinery and land taken / given on lease. All these leases are cancellable.

a) The lease Expenditure / Income recognized in the Statement of Profit and Loss :

Expenditure Rs. 982.22 lacs (Previous year Rs. 1,107.38 lacs)

Income Rs.157.40 lacs (Previous year Rs. 131.74 lacs)

b) Under these agreements refundable interest free deposits are given / taken except in case of land.

c) All these agreements have restriction on further leasing.

d) Agreements for office, factory premises and land provide for revision in the rent.

5. Derivative instruments and unheeded foreign currency

The Company is exposed to various financial risks which relate to changes in exchange rates and interest rates. The Company hedges risks of the aforesaid nature using forward and option contracts. The outstanding position and exposure is as under:

i) As at 31st March 2016, the outstanding position in respect of the derivatives / forward contracts in US $ is Rs. 14,407.34 lacs (Previous year Rs. 8,008.81 lacs) net payable.

ii) As at 31st March 2016, unheeded foreign currency exposure in US $ is Rs. 10,708.06 lacs (Previous year Rs. 30,184.93 lacs) net payable, in Euro Rs. 264.56 lacs (Previous year Rs. 107.15 lacs) net receivable, in UAE Dirham Rs. 20.31 lacs (Previous year Rs. 19.16 lacs) net payable.

6. Previous year''s figures have been regrouped / rearranged wherever necessary to conform to those of current year classification.

1

Subject to approval of Shareholders.

Mr. Gautam N. Mehra was re-appointed as the Managing Director of the Company by the Board for a period from 1st October, 2015 upto 30th September, 2018 vide an agreement dated 1st August, 2015. The said re-appointment was approved by the Members at the 54th Annual General Meeting of the Company.

Mr. C. V. Alexander was re-appointed as the Whole Time Director of the Company by the Board for a period from 1st October, 2015 up to 30th September, 2016 vide an agreement dated 1st August, 2015. The said re-appointment was approved by the Members at the 54th Annual General Meeting of the Company.

2

The Members at the 52nd Annual General Meeting of the Company had approved payment of remuneration by way of commission, a sum not exceeding 1% per annum of net profits of the Company subject to a ceiling of ''3 lac each per annum in addition


Mar 31, 2015

1) Rights, preferences and restrictions attached to equity shares (except forfeited shares)

The Company has only one class of equity shares having par value of Rs. 10 each. Each holder of equity shares is entitled to one vote per share.There are no restrictions on the distribution of dividend or repayment of capital.The Company declares dividend in Indian Rupees. 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.

2. In November 2006, the Company had entered into Technical Collaboration Agreement with Idemitsu Lube India Pvt. Ltd. (ILI) for manufacturing and marketing of Genuine Products . During the financial year 2013-14, the said agreement was terminated by ILI and a consideration of Rs. 5,790.65 lacs was received by the Company. This consideration, being exceptional in nature, has been disclosed as Exceptional Income in the Statement of Profit and Loss during the Previous year.

3. The Company has adopted the useful life of the assets as provided in Part C of Schedule II to the Companies Act, 2013 with effect from 1st April, 2014. Due to this change, depreciation for the year ended 31st March, 2015 is higher by Rs. 147.79 lacs. In addition to this, an amount of Rs. 39.36 lacs (net of deferred tax Rs. 20.27 lacs) relating to the assets having completed their useful life as at 1st April, 2014 has been charged to retained earnings.

4. The Company has spent Rs. 2.61 lacs (Previous year Nil) towards Corporate Social Responsibility expenditure (including capital expenditure Rs. Nil, Previous year Rs. Nil) and debited the same to the Statement of Profit and Loss as against Rs. 253.72 lacs computed as per the provisions of section 135(5) of the Companies Act, 2013.

5. In view of the loss for the year, the Company is in the process of filing an application with the Central Government to seek approval for waiver of excess remuneration of Rs. 30.12 lacs paid to the Chairman and Managing Director for the year.

2014-2015 2013-2014 Rs. in lacs Rs. in lacs

6. Contingent Liabilities not provided for

a) Letters of Credit 791.38 1,354.59

b) Guarantees / Bonds 2,329.89 2,145.53

c) Disputed demands

i) Excise and Customs 1,556.76 1,446.67

ii) Sales Tax 1,368.07 1,307.10

iii) Income Tax - 1,003.24

iv) Others 77.33 131.77

d) Claims not acknowledged as debt 200.00 50.00

7. Commitments

a) Estimated amount of contracts remaining to be executed on capital account and not provided for (net of advances) Rs. 465.85 lacs (Previous year Rs. 99.01 lacs).

b) The Company has set up wind power projects in the states of Maharashtra, Karnataka and Tamilnadu. The Company, in case of specific projects, has entered into agreements for sale of power exclusively to the state utility companies in the respective states, for periods varying from 13 to 20 years.

8. Leases

The Company has entered into agreements for operating leases in respect of residential, office, plant and machinery and land taken / given on lease. All these leases are cancellable.

a) The lease Expenditure/Income recognised in the Statement of Profit and Loss :

Expenditure Rs. 1107.38 lacs (Previous year Rs. 1,065.50 lacs)

Income Rs. 131.74 lacs (Previous year Rs. 81.87 lacs)

b) Under these agreements refundable interest free deposits are given / taken except in case of land.

c) All these agreements have restriction on further leasing.

d) Agreements for office, factory premises and land provide for revision in the rent.

9. Derivative instruments and unhedged foreign currency

The Company is exposed to various financial risks which relate to changes in exchange rates and interest rates.The Company hedges risks of the aforesaid nature using forward and option contracts. The outstanding position and exposure is as under:

i) As at 31st March 2015, the outstanding position in respect of the derivatives / forward contracts in US $ is Rs. 8,008.81 lacs (Previous year Rs. 18,160.42 lacs) net payable.

ii) As at 31st March 2015, unhedged foreign currency exposure in US $ is Rs. 30,184.93 lacs (Previous year Rs. 46,559.74 lacs) net payable, in Euro Rs. 107.15 lacs (Previous year Rs. 1,036.1 1 lacs) net receivable, in UAE Dirham Rs. 19.16 lacs (Previous year Rs. 18.36 lacs) net payable.

10. Employee Benefits: (Refer Notes 7 and 23)

i) Defined Contribution Plan:

Company's contribution to Provident Fund Rs. 164.42 lacs (Previous year Rs. 150.54 lacs).

ii) Defined Benefit Plan:

11. Details of related party transactions in accordance with the Accounting Standard AS-18 'Related Party Disclosures' Controlled by / Key Management Personnel: Mr. G.N.Mehra

Enterprises where key management personnel or relatives of key management personnel have control or significant influence:

Basant Lok Trading Co. Chemi Pharmex Pvt. Ltd. D.C.Mehra Public Charitable Trust

Khatri Investments Kurla Investment & Madhu Trust Pvt. Ltd. Trading Co. Pvt. Ltd.

Mansukhmal Investment N. K. Mehra Trust Naved Investment & Pvt. Ltd. Trading Co.Pvt. Ltd.

NKM Grand Children's Savita Petro-Additives Savita Polymers Trust Ltd. Ltd.

12. Previous year's figures have been regrouped / rearranged wherever necessary to conform to those of current year classification.


Mar 31, 2013

1 In November 2006, the Company had entered into a Technical Collaboration Agreement for manufacturing and marketing of Idemitsu Products (Agreement) with Idemitsu Lube India Pvt. Ltd. (ILI). The said Agreement was valid for a period of 10 years, i.e. up to 31st October, 2016. During the fnancial year 2011-2012, ILI served 180 days advance notice to terminate the Agreement and remitted consideration amounting toRs. 3,273.06 lacs. As at 31st March, 2012, pending completion of the notice period and termination process, the advance consideration received was disclosed as "Consideration received in advance" under Other Current Liabilities (Refer Note 9) . During the year, the Company received the balance consideration amounting to Rs. 2,377.22 lacs and the termination process was completed. Consideration on such termination being exceptional in nature, the Company has disclosed total consideration determined amounting to Rs. 5,650.28 lacs as Éxceptional Income in the Statement of Proft and Loss.

2 Contingent Liabilities not provided for

a) Letters of Credit 2,429.08 2,269.47

b) Guarantees/Bonds 2,242.95 1,951.87

c) Corporate guarantee * - 4,800.00

d) Disputed demands

i) Excise and Customs 1,921.24 2,506.88

ii) Sales Tax 1,364.06 1,032.09

iii) Income Tax 784.02 741.18

iv) Others 149.14 115.65

* Represents corporate guarantee given to banks for credit facilities of Savita Polymers Limited

3 Commitments

a) Estimated amount of contracts remaining to be executed on capital account and not provided for (net of advances) Rs. 831.87 lacs (Previous year Rs. 1,292.21 lacs).

b) The Company has set up wind power projects in the states of Maharashtra, Karnataka and Tamilnadu. The Company has entered into agreements for sale of power exclusively to the state utility companies in the respective states, for periods varying from 13 to 20 years.

4 Leases

The Company has entered into agreements for operating leases in respect of residential, offce, plant and machinery and land taken/given on lease. All these leases are cancellable.

a) The lease Expenditure/Income recognised in the Statement of Proft and Loss :

Expenditure Rs. 900.11 lacs (Previous year Rs. 804.12 lacs) Income Rs. 27.25 lacs (Previous year Rs. 27.36 lacs)

b) Under these agreements refundable interest free deposits are given/taken except in case of land.

c) All these agreements have restriction on further leasing.

d) Agreements for offce, factory premises and land provide for revision in the rent.

e) Cost, written down value and depreciation in respect of assets given on lease, being not material, have not been disclosed separately.

5 Derivative instruments and unhedged foreign currency

The Company is exposed to various fnancial risks which relate to changes in exchange rates and interest rates. The Company hedges risks of the aforesaid nature using forward and option contracts. The outstanding position and exposure is as under:

i) As at 31st March, 2013, the outstanding position in respect of the derivatives / forward contracts in US $ is Rs. 18,150.90 lacs (Previous year Rs. 18,257.54 lacs) net payable.

ii) As at 31st March, 2013, unhedged foreign currency exposure in US $ is Rs. 17,641.07 lacs (Previous year Rs. 32,036.72 lacs) net payable, in Euro Rs. 323.38 lacs net receivable (Previous year Rs. 11.72 lacs net payable), in UAE Dirham Rs. 16.64 lacs (Previous year Rs. 15.59 lacs) net payable.

6 Employee Benefts: (Refer Notes 7 and 23)

i) Defned Contribution Plan:

Company''s contribution to Provident Fund Rs. 129.72 lacs (Previous year Rs. 116.22 lacs).

ii) Defned Beneft Plan:

The following table sets out the funded status of the Gratuity Plan and the amounts recognised in the Company''s fnancial statements as at 31st March, 2013.

7 Previous year''s fgures have been regrouped / rearranged wherever necessary to conform to those of current year classifcation.

8 Figures in bracket indicate those for previous year.


Mar 31, 2012

1. In November 2006, the Company had entered into a Technical Collaboration Agreement for manufacturing and marketing of Idemitsu Products (Agreement) with Idemitsu Lube India Pvt. Ltd. (ILI). The said Agreement was valid for a period of 10 years, i.e., up to 31st October, 2016. In October 2011, ILI served 180 days advance notice to terminate the Agreement and suo-moto computed and remitted consideration amounting to ' 3,273.06 lacs. As at the Balance Sheet date, pending completion of the notice period and termination process, the advance consideration received has been disclosed as "Consideration received in advance" under Other Current Liabilities (Refer Note 9).

2. Contingent Liabilities not provided for

a) Letters of Credit 2,269.47 6,264.56

b) Guarantees/Bonds 1,951.87 1,792.97

c) Corporate guarantee * 4,800.00 2,400.00

d) Disputed demands

i) Excise and Customs 2,506.88 1,592.54

ii) Sales Tax 1,032.09 600.41

iii) Income Tax 741.18 637.11

iv) Others 115.65 51.94

* Represents corporate guarantee given to banks for credit facilities of Savita Polymers Limited

3. Commitments

a) Estimated amount of contracts remaining to be executed on capital account and not provided for (net of advances) Rs. 1,292.21 lacs (Previous year Rs. 1,397.73 lacs).

b) The Company has set up wind power projects in the states of Maharashtra, Karnataka and Tamilnadu. The Company has entered into agreements for sale of power exclusively to the state utility companies in the respective states, for periods varying from 13 to 20 years.

4. Leases

The Company has entered into agreements for operating leases in respect of residential, office, plant and machinery and land taken/given on lease. All these leases are cancellable.

a) The lease Expenditure/Income recognised in the Statement of Profit and Loss :

Expenditure Rs. 804.12 lacs (Previous year Rs. 791.51 lacs) (Refer Note 24)

Income Rs. 27.36 lacs (Previous year Rs. 26.01 lacs) (Refer Note 19)

b) Under these agreements refundable interest free deposits are given/taken except in case of land.

c) All these agreements have restriction on further leasing.

d) Agreements for office, factory premises and land provide for revision in the rent.

e) Cost, written down value and depreciation in respect of assets given on lease, being not material, have not been disclosed separately.

5. Derivative instruments and unhedged foreign currency

The Company is exposed to various financial risks which relate to changes in exchange rates and interest rates.

The Company hedges risks of the aforesaid nature using forward contracts. The outstanding position and exposure is as under:

i) As at 31st March 2012, the outstanding position in respect of the derivatives/forward contracts in US $ is Rs. 18,257.54 lacs (Previous year Rs. 13,215.11 lacs) net payable.

ii) As at 31st March 2012, unhedged foreign currency exposure in US $ is Rs. 32,036.72 lacs (Previous year Rs. 22,200.88 lacs) net payable, in Euro Rs. 11.72 lacs net payable (Previous year Rs. 94.02 lacs net receivable), in UAE Dirham Rs. 15.59 lacs (Previous year Rs. 10.58 lacs) net payable.

6. Details of related party transactions in accordance with the Accounting Standard AS-18 'Related Party Disclosures'

Controlled by / Key Management Personnel:

Mr. G.N.Mehra

Enterprises where key management personnel or relatives of key management personnel have control or significant influence:

Basant Lok Trading Co.

Khatri Investments Pvt. Ltd.

Mansukhmal Investment Pvt. Ltd.

NKM Grand Children's Trust Savita Polymers Ltd.

Relatives of key management personnel and relationship

Chemi Pharmex Pvt. Ltd.

Kurla Investment & Trading Co. Pvt. Ltd. Mehra Syndicate

Naved Investment & Trading Co.Pvt. Ltd.

D.C.Mehra Public Charitable Trust Madhu Trust N.K.Mehra Trust Savita Petro-Additives Ltd.

Mrs. S.N.Mehra - Mother Mrs. R.G.Mehra - Wife Mr. S.G.Mehra - Son Ms . S.G.Mehra - Daughter Details of transactions during the year: 2011-2012 Rs. in lacs 2010-2011 Rs. in lacs Enterprises: Sale of goods - Savita Polymers Ltd. 396.04 819.64 Sale of fixed assets - Savita Polymers Ltd. 0.94 4.29 Purchase of goods - Savita Polymers Ltd. 493.14 150.78 Purchase of fixed assets - Savita Polymers Ltd. 0.05 0.03 Dividend received - Savita Polymers Ltd. 1.00 1.00 Savita Petro-Additives Ltd. 0.01 0.01 Dividend paid - Basant Lok Trading Co. 1.23 0.93 Chemi Pharmex Pvt. Ltd. 0.20 0.15 Khatri Investments Pvt. Ltd. 85.52 64.14 Kurla Investment & Trading Co. Pvt. Ltd. 2.73 2.05 Mansukhmal Investment Pvt. Ltd. 82.00 61.50 Mehra Syndicate 1,840.67 1,379.39 Naved Investment & Trading Co. Pvt. Ltd. 1.70 1.28 NKM Grand Children's Trust - 0.17 Rent - Chemi Pharmex Pvt. Ltd. 45.13 45.13 Madhu Trust 23.82 23.82 Savita Polymers Ltd. - 58.72 Others - Basant Lok Trading Co. - Car parking charges 0.15 0.15 Chemi Pharmex Pvt. Ltd.- Car parking charges 0.30 0.15 Donations - D.C.Mehra Public Charitable Trust - 50.00 N.K.Mehra Trust 30.00 - Corporate Guarantee - Savita Polymers Ltd. 4,800.00 2,400.00 Security Deposit received back - Savita Polymers Ltd. - 14.25 Key management personnel: Dividend 33.76 25.32 Remuneration 160.86 219.95 Relatives of key management personnel: Dividend paid - Mrs. S.N.Mehra 33.60 25.02 Mrs. R.G.Mehra 6.68 5.01 Mr. S.G.Mehra 0.12 0.09 Accounts

7. The financial statements for the year ended 31st March 2012 have been prepared as per the revised Schedule VI to the Companies Act,1956. Accordingly,previous year's figures have been regrouped / rearranged wherever necessary to conform to those of current year classification.

8. Figures in bracket indicate those for previous year.


Mar 31, 2011

1. Contingent Liabilities not provided for :

As at As at 31.3.2011 31.3.2010 in lacs in lacs

a) Letters of Credit 6,264.56 2,611.92

b) Guarantees/Bonds 1,792.97 1,486.04

c) Corporate guarantee 2,400.00 2,400.00

d) Disputed demands

i) Excise and Customs 1,592.54 1,270.41

ii) Sales Tax 600.41 606.93

iii) Income Tax 637.11 24.35

iv) Others 51.94 51.94

2. Estimated amount of contracts remaining to be executed on capital account and not provided for (net of advances) Rs. 1,397.73 lacs (Previous Year Rs. 1,220.70 lacs).

3. Gross Sales are net of exchange fluctuation loss of Rs. 54.27 lacs (Previous Year Rs. 294.63 lacs) and Consumption is net of exchange fluctuation gain of Rs. 576.22 lacs (Previous Year Rs. 2,521.51 lacs).

4. Employee benefits:

i) Defined Contribution Plan:

Company's contribution to Provident Fund Rs. 104.72 lacs (Previous Year Rs. 86.12 lacs)

5. Details of related party transactions in accordance with the Accounting Standard AS-18 'Related Party Disclosures':

Enterprises where key management personnel or relatives of key management personnel have control or significant influence:

Basant Lok Trading Co.

Gautam & Co.

Madhu Trust

Naved Investment & Trading Co.Pvt. Ltd.

Savita Finance Corporation Ltd.

Siddharth Investments

Chemi Pharmex Pvt. Ltd. Khatri Investments Pvt. Ltd. Mansukhmal Investment Pvt. Ltd. NKM Grand Children's Trust Savita Petro-Additives Ltd.

D.C.Mehra Public Charitable Trust Kurla Investment & Trading Co. Pvt. Ltd. Mehra Syndicate N.K.Mehra Trust Savita Polymers Ltd.

Subsidiary:

Solaris International FZE (Sharjah, UAE) (in previous year) Key Management Personnel:

Mr. G.N.Mehra Relatives of key management personnel and relationship with Mr. G.N.Mehra Mrs. S.N.Mehra - Mother Mrs. R.G.Mehra - Wife Mr. S.G.Mehra - Son Ms. S.G.Mehra - Daughter

6. The Company has entered into agreements for operating leases in respect of residential, office, factory premises, plant and machinery and land taken/given on lease. All these leases are cancellable.

a) The lease Expenditure/Income recognised in the Profit and Loss Account: Expenditure Rs. 791.51 lacs (Previous Year Rs. 658.56 lacs) Income Rs. 26.01 lacs (Previous Year Rs. 24.77 lacs)

b) Under these agreements refundable interest free deposits are given/taken except in case of land.

c) All these agreements have restriction on further leasing.

d) Agreements for office, factory premises and land provide for revision in the rent.

7. The Company is exposed to various financial risks which relate to changes in exchange rates and interest rates.

The Company hedges risks of the aforesaid nature using forward contracts. The outstanding position and exposure is as under:

i) As at 31st March 2011, the outstanding position in respect of the derivatives / forward contracts in US $ is Rs. 13,215.11 lacs (Previous Year Rs. 11,086.25 lacs) net payable.

ii) As at 31st March 2011, un-hedged foreign currency exposure in US $ is Rs. 22,200.88 lacs (Previous Year Rs.15,733 lacs) net payable, in Euro Rs. 94.02 lacs net receivable (Previous Year Rs. 51.34 lacs net payable), in UAE Dirham Rs. 10.58 lacs (Previous Year Rs. Nil ) net payable.

8. Previous year's figures have been regrouped / rearranged wherever necessary to conform to those of current year.

9. Figures in bracket indicate those for previous year.


Mar 31, 2010

1. Contingent Liabilities not provided for:

As at As at 31.3.2010 31.3.2009 Rupees Rupees in lacs in lacs

a) Letters of Credit 2,611.92 773.54

b) Guarantees/Bonds 1,486.04 1,261.26

c) Corporate guarantee 2,400.00 2,400.00

d) Bills discounted with bank - 62.50

e) Disputed demands

i) Excise and Customs 1,270.41 1,302.16

ii) Sales Tax 606.93 610.85

iii) Income Tax 24.35 --

iv) Others 51.94 --

2. Estimated amount of contracts remaining to be executed on capital account and not provided for (net of advances) Rs.1,220.70 lacs (Previous Year Rs. 861.42 lacs).

3. Interest includes interest on fixed period loans Rs. 232.16 lacs (Previous Year Rs. 150.24 lacs) and to the Managing Director on fixed deposit Rs. Nil (Previous Year Rs. 1.56 lacs)

4. Gross Sales include exchange fluctuation net gain / (loss) (Rs.294.63) lacs (Previous Year Rs.344.08 lacs) and Purchases include exchange fluctuation net gain / (loss) Rs. 2,521.51 lacs (Previous Year (Rs.7,178.07 lacs)).

5. Details of related party transactions in accordance with the Accounting Standard AS-18 Related Party Disclosures:

Enterprises where key management personnel or relatives of key management personnel have control or significant influence:

Basant Lok Trading Co. Chemi Pharmex Pvt. Ltd. D.C.Mehra Public Charitable Trust

Devichand & Co Proprietor NKM Grand Gautam & Co. Khatri Investments Pvt. Ltd.

Childrens Trust

Kurla Investment & Trading Co. Pvt. Ltd. Madhu Trust Mansukhmal Investment Pvt. Ltd.

Mehra Syndicate Naved Investment & Trading N.K.Mehra Trust

Co.Pvt. Ltd.

Savita Finance Corporation Ltd. Savita Petro-Additives Ltd. Savita Polymers Ltd.

Siddharth Investments

Subsidiary:

Solaris International FZE (Sharjah, UAE) Key Management Personnel:

Mr. G.N.Mehra Relatives of key management personnel and relationship with Mr. G.N.Mehra

Mrs. S.N.Mehra - Mother Mrs. R.G.Mehra - Wife Mr. S.G.Mehra - Son Ms. S.G.Mehra - Daughter

6. Operating leases are agreements for residential, office, factory premises, plant and machinery and land taken/given on lease. All these leases are cancellable.

a) The lease Expenditure/Income recognised in the Profit and Loss Account:

Expenditure Rs. 658.56 lacs (Previous Year Rs. 428.55 lacs)

Income Rs. 24.77 lacs (Previous Year Rs. 23.59 lacs)

b) Under these agreements refundable interest free deposits are given/taken except in case of land.

c) Agreements for residential, office premises and land have restriction on further leasing.

d) Agreements for office, factory premises and land provide for revision in the rent.

7. The Company is exposed to various financial risks which relate to changes in exchange rates and interest rates. The Company hedges risks of the aforesaid nature using forward contracts. The outstanding position and exposure is as under:

i) As at 31 st March 2010, the outstanding position in respect of the derivatives / forward contracts in US $ is Rs.11,086.25 lacs. (Previous Year Rs. 8,730.43 lacs)

ii) As at 31st March 2010, un-hedged foreign currency exposure in US $ is Rs.15,733.00 lacs (Previous Year Rs.19,938.31 lacs), in Euro Rs.51.34 lacs (Previous Year Rs. 3.95 lacs), net payable.

8. Previous years figures have been regrouped / rearranged wherever necessary to confirm to those of current year.

9. Figures in bracket indicate those for previous year.

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