Notes to Accounts of Shilp Gravures Ltd.

Mar 31, 2018

1. Corporate Information

Shilp Gravures Limited is a public limited company, incorporated in the year 1993 under the provisions of the Companies Act, 1956 having its registered office at 778/6, Pramukh Industrial Estate, Sola-Santej Road, Rakanpur, Tal. Kalol, Gandhinagar - 382 722, Gujarat, India. The Company has set up, the first gravure roller manufacturing house in India. The Company is engaged in engraving of rollers using three different engraving technologies i.e. electronic, laser and chemical etching. The engraved rollers are used in printing and packaging industries.

2. Statement of compliance and basis of preparation and presentation

2.1 Statement of compliance

The financial statements have been prepared in accordance with Ind AS notified under the Companies (Indian Accounting Standards) Rules, 2015.

Upto the year ended March 31, 2017, the Company prepared its financial statements in accordance with the requirements of previous GAAP, which includes Standards notified under the Companies (Accounting Standards) Rules, 2006. These are the Company''s first Ind AS financial statements. The date of transition to Ind AS is April 1, 2016. Refer note - 4 for details of first time adoption exemptions availed by the Company.

2.2 Basis of preparation and presentation

The financial statements have been prepared on the historical cost basis except for certain financial instruments that are measured at fair values at the end of each reporting period, as explained in the accounting policies below.

Historical cost is generally based on the fair value of the consideration given in exchange for goods and services.

Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date, regardless of whether that price is directly observable or estimated using another valuation technique. In estimating the fair value of an asset or a liability, the Company takes into account the characteristics of the asset or liability if market participants would take those characteristics into account when pricing the asset or liability at the measurement date. Fair value for measurement and/or disclosure purposes in these financial statements is determined on such a basis, except for leasing transactions that are within the scope of Ind AS 17, and measurements that have some similarities to fair value but are not fair value, such as net realisable value in Ind AS 2 or value in use in Ind AS 36.

In addition, for financial reporting purposes, fair value measurements are categorised into Level 1, 2, or 3 based on the degree to which the inputs to the fair value measurements are observable and the significance of the inputs to the fair value measurement in its entirety, which are described as follows:

- Level 1 inputs are quoted prices (unadjusted) in active markets for identical assets or liabilities that the entity can access at the measurement date;

- Level 2 inputs are inputs, other than quoted prices included within Level 1, that are observable for the asset or liability, either directly or indirectly; and

- Level 3 inputs are unobservable inputs for the asset or liability.

1. Plant and Machinery includes softwares being an integral part of plant and machinery

2. For charges created on the aforesaid assets, refer note-18.

3. Gross Block and Accumulated Depreciation as on 1st April, 2016 under previous GAAP.

Note: The Company has used a practical expedient by computing the expected credit loss allowance for trade receivable 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 receivable are due and the rates as given in the provision matrix. The provision matrix at the end of the reporting periods is as follow.

(ii) Terms/Rights attached to equity shares

The Company has only one class of equity shares having a par value of Rs. 10 per share. Each holder of equity share is entitled to one vote per share. The dividend proposed by the Board of Directors is subject to the approval of shareholders in the ensuing Annual General Meeting. During the year ended 31st March 2018, the amount of per share dividend proposed for distribution to equity shareholders was Rs.1.50 (31st March 2017: Rs.1.50).

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

Note -

1. The above capital reserve pertains to Capital subsidy received of Rs. 15.00 lacs from Government of Gujarat in 1993 towards incentive for setting up plant in backward area and such subsidy can be use for purchase of capital assets.

2. The general reserve is used from time to time to tranfer profits from retained earning for appropriation purposes. As the general reserve is created by a transfer from one component of equity to another and is not an item of oher comprehensive income, items included in the general reserve will not be reclassified subsequently to profit or loss.

3. Retained Earning represent the amount that can be distributed by the Company as dividend, bonus etc. considering the requirements of the Companies Act, 2013. On 29th September, 2017, a dividend of Rs. 1.50 per share (total dividend of Rs. 92.25 Lacs) was paid to the holders of fully paid equity shares. In respect of year ended March 31, 2018, the directors propose that dividend of Rs. 1.50 per share be paid on fully paid equity shares. This dividend is subject to approval by shareholders at the Annual General Meeting and has not been included as a liabilities in the financial statements. The total estimated equity dividend to be paid is Rs. 92.25 Lacs.

Secured

(i) Hire purchase finance from the Daimler Financial Services India Private Limited for 5 Motor Cars amounting to Rs. 106.41 Lacs (as at 31st March 2017: Rs. 138.36 Lacs and as at 1st April 2016: Rs. 166.92 Lacs), out of which Rs. 106.41 Lacs (as at 31st March 2017: Rs. 31.95 Lacs and as at 1st April 2016: Rs. 28.56 Lacs) are classified as current maturity of long term debt, are secured by hypothecation of the Cars. (Refer note - 5)

(ii) Loan from The HDFC Bank Limited amounting to Rs. 551.14 Lacs (as at 31st March 2017: Rs. NIL and as at 1st April 2016: Rs. NIL), out of which Rs. 102.41 Lacs (as at 31st March 2017: Rs. NIL and as at 1st April 2016: Rs. NIL) is classified as current maturity of long term. The loan is secured by exclusive charge over Immovable and Movable assets of the Company. Further, the loan was guaranteed by the personal guarantee of Mr. Amber Patel. (Refer note - 5)

Note : According to the requirements of Ind AS, revenue for the corresponding previous year ended 31st March 2017 were reported inclusive of excise duty. The Government of India has implemented Goods and Service Tax ("GST") from 1st July 2017 replacing Excise Duty, Service Tax and various other indirect taxes. As per Ind AS 18 "Revenue" from 1st July 2017 onward, is reported net of GST. Had the previously reported revenue shown net of excise duty, comparative revenue of the Company would been as follows:

The tax rate used for reconciliation above is the corporate tax rate of 33.063% payable by corporate entities in India on taxable profits under Indian tax law. However, deferred tax is calculated at rate which enacted/substantially enacted as at March 31, 2018 & applicable w.e.f. FY 2018-19 @ 27.82%.

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

These plans typically expose the Company to actuarial risks such as interest rate risk and salary risk.

a) Interest risk: a decrease in the bond interest rate will increase the plan liability.

b) Salary risk: the present value of the defined benefit plan liability is calculated by reference to the future salaries of plan participants. As such, a variation in the expected rate of salary increase of the plan participants will change the plan liability.

VI. Sensitivity Analysis

Significant actuarial assumptions for the determination of defined obligation are discount rate and expected salary increase. The sensitivity analysis below have been determined based on reasonably possible changes of the respective assumptions occurring at the end of the reporting period, while holding all other assumptions constant.

The sensitivity analysis presented above may not be representative of the actual change in the defined benefit obligation as it is unlikely that the change in assumption would occur in isolation of one another as some of the assumptions may be correlated. Furthermore, in presenting the above sensitivity analysis, the present value of the defined benefit obligation has been calculated using the projected unit credit method at the end of the reporting period, which is the same as that applied in calculating the defined benefit obligation liability recognized in the balance sheet.

There was no change in the methods and assumptions used in preparing the sensitivity analysis from prior years.

VII. Asset Liability Matching Strategies

The Company has purchased insurance policy, which is basically a year-on year cash accumulation plan in which the interest rate is declared on yearly basis and is guaranteed for a period of one year. The Insurance Company, as part of the policy rules, makes payment of all gratuity out goes happening during the year (subject to sufficiency of funds under the policy). The policy thus mitigates the liquidity risk. However, being a cash accumulation plan, the duration of assets is shorter compared to the duration of liabilities. Thus, the Company is exposed to movement in interest rate (in particular, the significant fall in interest rates, which should result in a increase in liability without corresponding increase in the asset).

VIII. Effect of Plan on Entity''s Future Cash Flows

(i) Funding arrangements and Funding Policy

The Company has purchased an insurance policy to provide for payment of gratuity to the employees. Every year, the insurance company carries out a funding valuation based on the latest employee data provided by the Company. Any deficit in the assets arising as a result of such valuation is funded by the Company.

(ii) Expected contribution during the next annual reporting period

The Company''s best estimate of Contribution during the next year is Rs. 21.89 Lacs.

3. FINANCIAL INSTRUMENTS

(i) Capital management

The Company manages its capital structure with a view to ensure that it will be able to continue as a going concern while maximizing the return to stakeholders through the optimization of the debt and equity balance.

The Company''s management reviews the capital structure of the Company on an annual basis. As part of this review, the management considers the cost of Capital and the risks associated with each class of capital.

(iii) Financial risk management objective

The Company''s financial liabilities comprise mainly of borrowing, trade payables and other payables. The Company''s financial assets comprise mainly of investments in mutual funds, cash and cash equivelant, other balance with banks, loans, trade receivable and other receivable. These risks include market risk (including currency risk, interest rate risk and other price risk), credit risk and liquidity risk.

(iv) Market Risk

Market risk is the risk that the fair value of future cash flows of a financial instrument will fluctuate because of changes in market prices. Market risk comprises of three types of risks: interest rate risk, currency risk and other risk. Financial instruments affected by market risk includes borrowings, investments, trade payable, trade receivable, loans and advances.

a) Interest Rate Risk

Interest rate risk is the risk that the fair value of future cash flows of a financial instrument will fluctuate because of changes in market interest rates. The Company''s exposure to the risk of changes in market interest rates relates primarily to the Company''s long tem debt obligations with floating interest rates.

The sensitivity analysis has been carried out based on the exposure to interest rates on long term borrowings. The said analysis has been carried on the amount of floating rate long term liabilities outstanding at the end of the reporting period. A 50 basis point increase or decrease represents management''s assessment of the reasonably possible change in interest rates.

b) Foreign Currency Risk

Foreign Currency risk is the risk that the fair value of future cash flows of an exposure will fluctuate due to changes in foreign exchange rates. The Company does not enter into any derivative instruments for trading or speculative purposes.

Foreign Currency sensitivity analysis

The Company is exposed to foreign exchange risk arising from various currency exposures, primarily with respect to US Dollar, CHF and Euro.

The following table details the Company''s sensitivity to a 10% increase and decrease in the Rupees against the relevant foreign currencies. 10% is the sensitivity rate used when reporting foreign currency risk internally to key management personnel and represents management''s assessment of the reasonably possible change in foreign exchange rates. The sensitivity analysis includes receivables and payable in currency other than the functional currency of the Company.

A 10% strengthening of the INR against key currencies to which the Company is exposed (net of hedge) would have led to additional gain in the Statement of Profit and Loss with a corresponding increase in total equity at the end of the reporting period. A 10% weakening of the INR against these currencies would have led to an equal but opposite effect.

c) Other Price Risk

Other price risk is the risk that the fair value of a financial instrument will fluctuate due to changes in market traded price. Other price risk arises from financial assets such as investments in equity instruments and mutual funds. The Company does not have investment in equity instruments as on 31st March 2018. The Company is exposed to price risk arising mainly from investment in equity and liquid based mutual fund. The carring value of such mutual funds recognised at FVTPL amount to Rs. 1617.79 Lacs as at 31st March, 2018 (Rs. 1229.20 Lacs as at 31st March, 2017 and Rs. 162.02 Lacs as at 1st April 2016). The details of such instruments are given in Note 11.

If the NAV has been higher/lower by 10% from the market NAV existing as at 31st March, 2018, the income from other source for the year ended 31st March 2018 would increase/decrease by Rs. 161.78 Lacs (for 2016-17 Rs. 122.74 Lacs, 2015-16 Rs. 16.02 Lacs) with a corresponding increase/decrease in total equity of the Company as at 31st March, 2018. 10% represents management''s assessment of reasonably possible changes in NAV of mutual funds.

V Credit Risk

Credit risk refers to risk that a counterparty will default on its contractual obligations resulting in financial loss to the Company. Credit risk arises primarily from financial assets such as trade receivables, investment in mutual funds, derivative financial instruments, other balances with banks, loans and other receivables.

(a) Trade receivables management

The Company has used a practical expedient by computing the expected credit loss allowance for trade receivable 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 receivable are due and the rates as given in the provision matrix.

b) Other financial assets

Credit risk arising from investment in mutual funds, derivative financial instruments and other balances with banks is limited and there is no collateral held against these because the counterparties are banks and recognized financial institutions with high credit ratings assigned by the various credit rating agencies and investment in mutual funds are equity and liquid fund.

4. SEGMENT REPORTING

The Chief Operating Decision maker monitors the operating results of its business segments seperately for the purpose of making decision about resource allocation and performance assessment. Segment performance is evaluated based on the profit or loss and its measured consistently with profit or loss in the financial statements. Operating segment have been identified on the basis of products / services and have been identified as per the quantative criteria specified in the Ind AS 108.

The Company has identified three reportable segments viz (i) manufacture of engraved copper rollers and (ii) energy generation through wind mill and (iii) Others

5. DISCLOSURES UNDER THE MSMED ACT, 2006

In the absence of any information from vendors regarding the status of their registration under the "Micro Small and Medium Enterprise Development Act 2006" the company is unable to comply with the disclosures required to be made under the said Act.

6. CORPORATE SOCIAL RESPONSIBILITY (CSR) EXPENDITURE

As per section 135 of Companies Act, 2013, a Company, meeting the applicability threshold, need to spend at least 2% of its average net profit for the immediately preceding three financial years on corporate social responsibility (CSR) activities. These all CSR activities are eradication on hunger and malnutrition, promoting education, art and culture, healthcare, destitute care and rehabilitation, environment sustainability, disaster relief and rural development projects. A CSR committee has been formed by the Company as per the Act. The fund were primarily allocated to a corpus and utilized through the year on these activities which are specified in Schedule VII of the Companies Act, 2013.

a) Current Investment

In the financial statements prepared under previous GAAP, current investments of the Company were measured at lower of cost and fair value. Under Ind AS, these investments have been classified as FVTPL. The fair value changes are recognized in the Statement of Profit and Loss.

On the date of transition to Ind AS as at 1st April 2016, the difference between the fair value of current investments as per Ind AS and their corresponding carrying amount as per financial statements prepared under previous GAAP, has resulted in an increase in the carrying amount of these investments by Rs 7.57 Lacs with corresponding increased in the retained earnings.

As on 31st March, 2017, the fair value of current investment has been increased by 26.40 Lacs.

During the year ended 31st March 2017, net gain amounting to Rs.18.83 Lacs on such fair valuation is recognized in the Statement of Profit and Loss as other income.

b) Expected Credit Loss

Under previous GAAP, the Company used to create provision for receivables only in respect of specific amount for doubtful receivables. Under Ind AS, impairment allowance has been determined based on Expected Credit Loss model (ECL).

Consequent to this change, on the date of transition to Ind AS, allowance for ECL of Rs. 20.27 Lacs is recognized with corresponding reduction in the retained earnings by Rs. 13.57 Lacs and deferred tax liabilities by Rs. 6.70 Lacs.

The amount of allowances for ECL recognized as at 31st March 2017 is Rs. 7.88 Lacs.

c) Short Term Provisions

As per IND AS 10 "Events After Reporting Period", the proposed dividend is required to be recognized in the period in which it is declared. However, as per Indian GAAP, the same was required to be recognized in the period in which it was related. So the Company has reversed the proposed dividend of Rs. 73.80 Lacs and tax thereon of Rs. 15.02 Lacs for the Financial Year 2015-16 since the same was approved by the shareholders on 23rd September, 2016, and the same was paid on 29th September, 2016.

d) Remeasurement of defined benefit plan

In the financial statements prepared under previous GAAP, remeasurement of defined benefit plans and assets (gratuity), arising due to change in actuarial assumptions was recognized as employee benefits expense in the Statement of Profit and Loss, Under Ind AS, such remeasurement benefits relating to defined benefit plans and assets is recognized in OCI as per the requirements of Ind AS 19 -Employees benefits. Consequently, the related tax effect of the same has also been recognized in OCI.

For the year ended 31st March 2017, remeasurement of gratuity liability resulted in net benefit of Rs. 14.69 Lacs which has now been removed from employee benefits expense in the Statement of Profit and Loss and recognized separately in OCI. And recognised deferred tax assets theron by Rs. 4.86 Lacs

e ) Deferred tax

In the financial statements prepared under previous GAAP, deferred tax was accounted as per the income statement approach which required creation of deferred tax asset/ liability on timing differences between taxable profit and accounting profit. Under Ind AS, deferred tax is accounted as per the Balance Sheet approach which requires creation of deferred tax asset/ liability on temporary differences between the carrying amount of an asset / liability in the Balance Sheet and its corresponding tax base.

The transitional adjustments as described in the preceding paragraphs have led to temporary differences and creation of deferred tax thereon. This has resulted in creation of net deferred tax asset of Rs. 6.70 Lacs as at date of transition to Ind AS with a corresponding decrease in retained earnings and reduction in the amount of deferred tax asset in the Balance Sheet.

For the year ended 31st March 2017, it has resulted in decrease in deferred tax expense by Rs. 2.61 Lacs in the Statement of Profit and Loss and increase in deferred tax expense of Rs. 2.61 Lacs.

NOTE 7 - STANDARDS ISSUED BUT NOT EFFECTIVE

The Ministry of Corporate Affairs("MCA") has issued certain amendments to Ind AS through (Indian Accounting Standards) Amendment Rules, 2018. These amendments maintain convergence with IFRS by incorporating amendments issued by International Accounting Standards Board(IASB) into Ind AS and has amended the following standards:

1. Ind AS 115-Revenue from contract with customers

2. Ind AS 21-The effect of changes in foreign exchanges rates

3. Ind AS 12-Income taxes

These amendments are effective for annual periods beginning on or after April 01, 2018.

The company is identifying and evaluating the key impact of the aforesaid amendments.

NOTE 8 - APPROVAL OF FINANCIAL STATEMENTS

The financial statements were approved for issue by the board of directors on April 28, 2018.

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Mar 31, 2016

1. Terms/Rights attached to equity shares

The Company has only one class of equity shares having a par value of Rs. 10 per share. Each holder of equity share is entitled to one vote per share. The Company declares and pays dividends in Indian Rupees. The dividend proposed by the Board of Directors is subject to the approval of shareholders in the ensuing Annual General Meeting.

During the year ended 31st March 2016, the amount of per share dividend recognized as distributions to equity shareholders was Rs.1.20(31st March 2015: Rs.1.20).

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

2. Loan from The Ahmedabad Mercantile Co-operative Bank Limited amounting to Rs. NIL (P.Y. Rs. 133.76 Lacs), out of which Rs. NIL (P.Y. Rs. 103.40 Lacs) is classified as current maturity. The entire outstanding has been repaid as on 13/10/2015. The loan was secured by exclusive charge over windmills acquired out of the said loan. Further, the loan was guaranteed by the personal guarantee of some of the promoter directors.

3. Loan from The Ahmedabad Mercantile Co-operative Bank Limited amounting to Rs. NIL (P.Y. Rs. 353.65 Lacs), out of which Rs. NIL (P.Y. Rs. 105.14) is classified as current maturity. The entire outstanding loan has been repaid as on 29/02/2016. The loan was secured by exclusive charge over the new Imported Machineries acquired out of the said loan. Further, the loan was guaranteed by the personal guarantee of some of the promoter directors.

4. Loan from The Ahmedabad Mercantile Co-operative Bank Limited amounting to Rs. NIL (P.Y. Rs. 209.12 Lacs), out of which Rs. NIL (P.Y. Rs. 60.22 Lacs) is classified as current maturity. The entire outstanding loan has been repaid as on 02/02/2016. The loan was secured by exclusive charge over a windmill acquired out of the said loan. Further, the loan was guaranteed by the personal guarantee of some of the promoter directors.

(5. Hire purchase finances from The Ahmedabad Mercantile Co-operative Bank Limited for Car amounting to Rs. NIL (P.Y. Rs. 9.58 Lacs), out of which Rs. NIL (P.Y. Rs. 3.12 Lacs) is classified as current maturity, is secured by hypothecation of the Car. The entire outstanding loan amount has been paid as on 31/12/2015.

6. Hire purchase finance from the Daimler Financial Services India Private Limited for 5 Motor Cars amounting to Rs. 166.92 Lacs (P.Y. Rs. Nil), out of which Rs. 28.56 Lacs (P.Y. Rs. Nil) are classified as current maturity, are secured by hypothecation of the Cars.

7. EMPLOYEE BENEFITS

The Company makes Provident Fund and Superannuation Fund contributions which are defined contribution plans, for qualifying employees. Under the Schemes, the Company is required to contribute a specified percentage of the payroll costs to fund the benefits. The Company recognized Rs. 59.22 Lacs (Year ended 31 March, 2015 - Rs. 44.98 Lacs) for Provident Fund contributions, and Rs. 4.60 Lacs (Year ended 31 March, 2015 - Rs. 6.24 Lacs) for Superannuation Fund contributions in the Statement of Profit and Loss. The contributions payable to these plans by the Company are at rates specified in the rules of the schemes.

8. SEGMENT REPORTING

The Company has identified two reportable segments viz (i) manufacture of engraved copper rollers and (ii) energy generation through wind mill.

The segment revenue, results, assets and liabilities include the respective amounts identifiable to each of the segment and amount allocated on a reasonable basis by management.

9. INTEREST IN JOINT VENTURE

The Company had entered into a Joint Venture Agreement with three Companies namely, Hannecard N.V., Mitex GMBH and Unimark International Private Limited to incorporate a Joint Venture Company in the name of HMSU Rollers (India) Private Limited on 1st February, 2012. The said Joint Venture Company was engaged in the manufacturing of Rubber Rollers and Poly Urethene Rollers. The Company had commenced its commercial operations with effect from 18th April, 2013. During the year, pursuant to approval from Board of Directors, the company has sold all shares of HMSU Rollers (India) Private Limited on 30th March, 2016 and from that date HMSU Rollers (India) Private Limited ceased to be joint venture of the company.

10. Figures of previous year have been regrouped / reclassified, wherever necessary, to make them comparable with current year figures.

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Mar 31, 2015

I) Terms/Rights attached to equity shares

The Company has only one class of equity shares having a par value of Rs, 10 per share. Each holder of equity share is entitled to one vote per share. The Company declares and pays dividends in Indian Rupees. The dividend proposed by the Board of Directors is subject to the approval of shareholders in the ensuing Annual General Meeting.

During the year ended 31st March 2015, the amount of per share dividend recognised as distributions to equity shareholders was Rs, 1.20 (31st March 2014 : Rs, 1.20)

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

Secured

(i) Loan from The Ahmedabad Mercantile Co-operative Bank Limited amounting to Rs, 133.76 Lacs (P.Y. Rs, 281.76 Lacs), out of which Rs, 103.40 Lacs (P.Y. Rs, 103.40 Lacs) is classified as current maturity. The loan is repayable in 60 Monthly installments of Rs,11.50 Lacs each including interest, from March, 2012. The loan is secured by exclusive charge over windmills acquired out of the said loan. Further, the loan has been guaranteed by the personal guarantee of some of the promoter directors.

(ii) Loan from The Ahmedabad Mercantile Co-operative Bank Limited amounting to Rs, 353.65 Lacs (P.Y. Rs, 492.96 Lacs), out of which Rs, 105.14 Lacs (P.Y. Rs, 105.14) is classified as current maturity. The loan is repayable in 60 Monthly installments of Rs, 11.94 Lacs each including interest, from October, 2013. The loan is secured by exclusive charge over the new Imported Machineries acquired out of the said loan. Further, the loan has been guaranteed by the personal guarantee of some of the promoter directors.

(iii) Loan from The Ahmedabad Mercantile Co-operative Bank Limited amounting to Rs, 209.12 Lacs (P.Y. Rs, 260.95 Lacs), out of which Rs, 60.22 Lacs (P.Y. Rs, 60.22 Lacs) is classified as current maturity. The loan is repayable in 60 Monthly installments of Rs,6.75 Lacs each including interest, from May, 2013. The loan is secured by exclusive charge over a windmill acquired out of the said loan. Further, the loan has been guaranteed by the personal guarantee of some of the promoter directors.

(iv) Hire purchase finances from The Ahmedabad Mercantile Co-operative Bank Limited for Car amounting to Rs, 9.58 Lacs (P.Y. Rs, 11.64 Lacs), out of which Rs, 3.12 Lacs (P.Y. Rs, 3.12) is classified as current maturity, is secured by hypothecation of the Car.

Unsecured

(v) Unsecured loan amounting to Rs, Nil Lacs (P.Y. Rs, 145.73 Lacs) taken from Life Insurance Corporation of India. The loan was availed against Keyman Insurance policies of the key personnel of the Company.

(i) Working capital loan from The Ahmedabad Mercantile Co. Op. Bank Ltd. of Rs, 840.18 Lacs (P.Y. Rs, 653.56 Lacs). The same is secured by present and future book debts and inventories of the Company, personal guarantee of some of the promoter directors.

* There is no amount due and outstanding to be credited to Investor Education and Protection Fund

1. Figures in the brackets represent the previous year figures.

2. Plant and Machinery includes softwares being an integral part of plant and machinery

1. EMPLOYEE BENEFITS

The Company makes Provident Fund and Superannuation Fund contributions which are defined contribution plans, for qualifying employees. Under the Schemes, the Company is required to contribute a specified percentage of the payroll costs to fund the benefits. The Company recognised Rs, 44.98 Lacs (Year ended 31 March, 2014 - Rs, 36.99 Lacs) for Provident Fund contributions, and Rs, 6.24 Lacs (Year ended 31 March, 2014 - Rs, 6.24 Lacs) for Superannuation Fund contributions in the Statement of Profit and Loss. The contributions payable to these plans by the Company are at rates specified in the rules of the schemes.

As per Accounting Standard 15 "Employee Benefits", the disclosures of Employee benefits as defined in the Accounting Standard are given below:

2. SEGMENT REPORTING

The Company has identified business segments as its primary segment and geographical segments as its secondary segment. Reportable business segments are primarily

(i) manufacture of engraved copper rollers and

(ii) energy generation through wind mill. Expenses which are not directly identifiable to each reportable segment have been allocated on the basis of associated revenues of the segment and manpower efforts. All other expenses which are not attributable or allocable to segments have been disclosed as unallocable expenses. Assets and liabilities that are directly attributable or allocable to segments are disclosed under each reportable segment. All other assets and liabilities are disclosed as unallocable. Fixed assets that are used interchangeably amongst segments are not allocated to primary and secondary segments.

The segment revenue, results, assets and liabilities include the respective amounts identifiable to each of the segment and amount allocated on a reasonable basis by management.

Disclosures required under AS 17 – Segment Reporting are as under:

(Figures in brackets represent previous year numbers)

3. DISCLOSURES UNDER THE MSMED ACT, 2006

In the absence of any information from vendors regarding the status of their registration under the "Micro Small and Medium Enterprise Development Act 2006" the company is unable to comply with the disclosures required to be made under the said Act.

4. Effective from 1st April, 2014, the Company has charged depreciation based on remaining useful life of the assets as per the requirements of Schedule II of the Companies Act, 2013 ("the Act"). Consequent to this, depreciation charge for the year ended on 31st March, 2015 is higher by Rs,69.72 lacs. Further, in accordance with the transitional provisions provided in Note 7(b) of Schedule of the Act, an amount of Rs, 64.55 lacs (Net of deferred tax credit of Rs, 31.01 lacs) has been adjusted against the opening balance of retained earnings in respect of assets wherein remaining useful life of the assets is Nil.

5. INTEREST IN JOINT VENTURE

The Company has entered into a Joint Venture Agreement with three Companies namely, Hannecard N.V., Mitex GMBH and Unimark International Private Limited to incorporate a Joint Venture Company in the name of HMSU Rollers (India) Private Limited on 1st February, 2012. The said Joint Venture Company is engaged in the manufacturing of Rubber Rollers and Poly Urethene Rollers. The Company has commenced its commercial operations with effect from 18th April, 2013.

6. Figures of previous year have been regrouped / reclassified, wherever necessary, to make them comparable with current year figures.

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Mar 31, 2014

1. BACKGROUND OF THE COMPANY

Shilp Gravures Limited is a public limited company, incorporated in the year 1993 under the provisions of the Companies Act, 1956. Its shares are listed on the Bombay Stock Exchange since 1995. The Company has set up, the first gravure roller manufacturing house in India. The Company is engaged in engraving of rollers using three different engraving technologies i.e. electronic, laser and chemical etching. The engraved rollers are using in printing and packaging industries.

i) Terms/Rights attached to equity shares

The Company has only one class of equity shares having a par value of Rs. 10 per share. Each holder of equity share is entitled to one vote per share. The Company declares and pays dividends in Indian Rupees. The dividend proposed by the Board of Directors is subject to the approval of shareholders in the ensuing Annual General Meeting.

During the year ended 31st March 2014, the amount of per share dividend recognised as distributions to equity shareholders was Rs. 1.20 (31st March 2013 : Rs. 1.50) In the event of liquidation of the Company, the holders of equity shares will be entitled to receive remaining assets of the Company, after distribution of all prefential amounts. The distribution will be in proportion to the number of equity shares held by the shareholders.

2. LONG TERM BORROWINGS

Secured

(i) Loan from The Ahmedabad Mercantile Co-operative Bank Limited amounting to Rs. 281.76 Lacs (P.Y. Rs. 380.34 Lacs), out of which Rs. 103.40 Lacs (P.Y. Rs. 103.40 Lacs) is classified as current maturity. The loan is repayable in 60 Monthly installments of Rs. 11.50 Lacs each including interest, from March, 2012. The loan is secured by exclusive charge over the three new windmills acquired out of the said loan. Further, the loan has been guaranteed by the personal guarantee of some of the promoter directors.

(ii) Loan from The Ahmedabad Mercantile Co-operative Bank Limited amounting to Rs. Nil (P.Y. Rs. 133.41 Lacs), out of which Rs. Nil (P.Y. Rs. 29.68 Lacs) is classified as current maturity. The loan was secured by exclusive charge over the new Imported Machineries acquired out of the said loan. Further, the loan was guaranteed by the personal guarantee of some of the promoter directors.

(iii) Loan from The Ahmedabad Mercantile Co-operative Bank Limited amounting to Rs. 492.96 Lacs (P.Y. Rs. Nil), out of which Rs. 105.14 Lacs (P.Y. Rs. Nil) is classified as current maturity. The loan is repayable in 60 Monthly installments of Rs. 11.94 Lacs each including interest, from October, 2013. The loan is secured by exclusive charge over the new Imported Machineries acquired out of the said loan. Further, the loan has been guaranteed by the personal guarantee of some of the promoter directors.

(iv) Loan from The Ahmedabad Mercantile Co-operative Bank Limited amounting to Rs. 260.95 Lacs (P.Y. Rs. 263.96 Lacs), out of which Rs. 60.22 Lacs (P.Y. Rs. 52.79 Lacs) is classified as current maturity. The new loan is repayable in 60 Monthly installments of Rs. 6.75 Lacs each including interest, from May, 2013. The loan is secured by exclusive charge over the new one windmill to be acquired out of the said loan. Further, the loan has been guaranteed by the personal guarantee of some of the promoter directors.

(v) Hire purchase finances from The Ahmedabad Mercantile Co-operative Bank Limited for Car amounting to Rs. 3.84 Lacs (P.Y. Rs. Nil), out of which Rs. 1.02 Lacs (P.Y. Rs. Nil) is classified as current maturity, is secured by hypothecation of the Car.

(vi) Hire purchase finances from The Ahmedabad Mercantile Co-operative Bank Limited for Car amounting to Rs. 11.64 Lacs (P.Y. Rs. Nil), out of which Rs. 3.12 Lacs (P.Y. Rs. Nil) is classified as current maturity, is secured by hypothecation of the Car.

(vii) Hire purchase finances for Car amounting to Rs. 1.03 Lacs (P.Y. Rs. 5.02 Lacs), out of which Rs. 1.03 Lacs (P.Y. Rs. 3.98 Lacs) is classified as current maturity, is secured by hypothecation of the Car.

Unsecured

(viii) Unsecured loan amounting to Rs. 145.73 Lacs (P.Y. Rs. 172.53 Lacs) taken from Life Insurance Corporation of India. The loan is availed against Keyman Insurance policies of the key personnels of the Company. The same to be paid on or before the maturity of the respective Keyman Insurance policies i.e. 24-05-2015 Rs. 25.65 Lacs, 04-06-2015 Rs. 26.80 Lacs, 28-07-2016 Rs. 18.76 Lacs, 10-05-2018 Rs. 18.95 Lacs, 04-06-2018 Rs. 18.95 Lacs, 15-07-2018 Rs. 18.31 Lacs, 24-08-2018 Rs. 18.31 Lacs

3. EMPLOYEE BENEFITS

The present value of gratuity and leave encashment obligations is determined based on actuarial valuation by an independent expert, using the Projected Unit Credit Method, which recognizes each period of service as giving rise to additional unit of employee benefit entitlement and measures each unit separately to build up the final obligation.

4. CONTINGENT LIABILITES (Rs. in Lacs)

As at As at Particulars 31st MARCH, 2014 31st MARCH, 2013

Disputed demand of Income tax against which the Company has preferred appeal 28.44 73.19

Corporate Guarantee given* 1,190.00 -

Bills Discounted - 51.36

* The Company has provided Corporate Guarantee for an amount of Rs. 1190.00 Lacs in favour of Axis Bank Limited for the Term Loan provided to HMSU Rollers (India) Private Limited, a Joint Venture Company.

The Partners of Joint Venture Agreement have entered into an interse Memorandum of Understanding that though the Corporate Guarantee is being provided for 100% amount of Loan faciltiies availed by Joint Venture company, but in case of invocation of the guarantee by the lender, the risk will be borne by all partners in their share holding ratios only. Hence, the liability of the Company, if any, will be restricted to Rs. 238.00 Lacs (being 20% of total amount of Loan facilities).

5. SEGMENT REPORTING

The Company has identified two reportable segments viz (i) manufacture of engraved copper rollers and (ii) energy generation through wind mill.

The segment revenue, results, assets and liabilities include the respective amounts identifiable to each of the segment and amount allocated on a reasonable basis by management.

6. DISCLOSURES UNDER THE MSMED ACT, 2006

In the absence of any information from vendors regarding the status of their registration under the "Micro Small and Medium Enterprise Development Act 2006" the company is unable to comply with the disclosures required to be made under the said Act.

7. INTEREST IN JOINT VENTURE

The Company has entered into a Joint Venture Agreement with three Companies namely, Hannecard N.V., Mitex GMBH and Unimark International Private Limited to incorporate a Joint Venture Company in the name of HMSU Rollers (India) Private Limited on 1st February, 2012. The said Joint Venture Company is engaged in the manufacturing of Rubber Rollers and Poly Urethene Rollers. The Company has commenced its commercial operations with efffect from 18th April, 2013.

8. Figures of previous year have been regrouped / reclassified, wherever necessary, to make them comparable with current year figures.

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Mar 31, 2013

1. BACKGROUND OF THE COMPANY

Shilp Gravures Limited is a public limited company, incorporated in 1993 under the provisions of the Companies Act, 1956. Its shares are listed on the Bombay Stock Exchange since 1995. The Company has set up, first gravure roller manufacturing house in India. The Company is engaged in engraving of rollers through three difference engraving technologies i.e. electronic, laser and chemical etching. The engraved rollers are using for printing and packaging industries.

2 CONTINGENT LIABILITES (Rs. in Lacs)

As at As at

Particulars 31st MARCH, 2013 31st MARCH, 2012

Disputed demand of Income tax against which the Company has preferred appeal 73.19 18.25

Bills Discounted 51.36 72.69

The Board of Directors have in their meeting held on 05th November, 2012 passed a resolution for providing Corporate Guarantee for an amount of Rs. 1190.00 Lacs in favour of Axis Bank Limited for the Term Loan provided to HMSU Rollers (India) Private Limited, a Joint Venture Company. However, an application is being made to Ministry of Corporate Affairs for sorting their prior approval before executing the said Corporate Guarantee. The application is still under process at Ministry.

The Partners of Joint Venture Agreement have entered into an interse Memorandum of Understanding that though the Corporate Guarantee is being provided for 100% amount of Loan faciltiies availed by Joint Venture company, but in case of any wrong event, the risk will be borne by all partners in their share holding ratios only. Hence, the liability of the company, if any, will be restricted to Rs. 238.00 Lacs (being 20% of total amount of Loan facilities).

3 SEGMENT REPORTING

The Company has identified two reportable segments viz (i) manufacture of engraved copper rollers and (ii) energy generation through wind mill.

The segment revenue, results, assets and liabilities include the respective amounts identifiable to each of the segment and amount allocated on a reasonable basis by management.

4 DISCLOSURES UNDER THE MSMED ACT, 2006

In the absence of any information from vendors regarding the status of their registration under the "Micro Small and Medium Enterprise Development Act 2006" the company is unable to comply with the disclosures required to be made under the said Act.

5 Balance of Receivables , Payables, and loans and advances to parties are subject to their confirmation. These balances therefore, subject to adjustment, if any , as may be required on settlement of these balances with the parties

6 Figures of previous year have been regrouped / reclassified, wherever necessary, to make them comparable with current year figures.

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Mar 31, 2012

1. BACKGROUND OF THE COMPANY

Shilp Gravures Limited is a public limited company, incorporated in 1993 under the provisions of the Companies Act, 1956. Its shares are listed on the Bombay Stock Exchange since 1995. The Company has set up, first gravure roller manufacturing house in India. The Company is engaged in engraving of rollers through three difference engraving technologies i.e. electronic, laser and chemical etching. The engraved rollers are using for printing and packaging industries.

i) Terms/Rights attached to equity shares

The Company has only one class of equity shares having a par value of Rs. 10 per share. Each holder of equity share is entitled to one vote per share. The Company declares and pays dividends in indian (Rs. in Lacs). The dividend proposed by the Boad of Directors is subject to the approval of shareholders in the ensuing Annual General Meeting.

During the year ended 31st March 2012, the amount of per share dividend recognised as distributions to equity shareholders was Rs.1.50 (31st March 2011 : Rs.1.25)

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

Secured

(i) Indian Rupee loan from The Ahmedabad Mercantile Co-operative Bank Limited amounting to Rs. 391.65 Lacs (P.Y. Rs. NIL). The loan is repayable in 60 Monthly installments of Rs.11.50 Lacs each including interest, from March, 2012. The loan is secured by exclusive charge over the new three windmills acquired out of the said loan. Further, the loan has been guaranteed by the personal guarantee of some of the promoter directors.

(ii) Hire purchase finances for Car amounting to Rs. 5.02 Lacs (P.Y. Rs. Nil) is secured by hypothecation of the Car.

Unsecured

(iii) Unsecured loan amounting to Rs. 172.53 Lacs (P.Y. Rs. 169.38 Lacs) taken from Life Insurance Corporation of India. The loan is availed against Keyman Insurance Policies of the key employees of the Company. The same to be paid on or before the maturity of the respective Keyman Insurance Policy.

(i) Working capital loan from The Ahmedabad Mercantile Co. Op. Bank Ltd. of Rs. 715.32 Lacs (P.Y. Rs. 692.91 Lacs). The same is secured by present and future book debts and inventories of the Company, personal guarantee of some of the promoter directors and further secured by second charge over fixed assets held by The Royal Bank of Scotland.

(ii) Working capital loan from The Royal Bank of Scotland of Rs. 272.87 Lacs (P.Y. Rs. 268.54 Lacs). The same is secured by exclusive charge over entire fixed assets of the Company both present and future. Further, the loan has been guaranted by personal guarantee of all the promoter directors.

* There is no amount due and outstanding to be credited to Investor Education and Protection Fund

Secured

(a) Indian Rupee loan from CITI Bank amounting to Rs. 67.67 Lacs (P.Y. Rs. 135.33 Lacs). The loan is repayable in 12 Quarterly installments of Rs.16.92 lacs each excluding interest, from June, 2010. The loan is secured by exclusive charge over plant and machinery created out of that loan. Further, the loan has been guaranteed by the personal guarantee of some of the promoter directors.

(b) Indian Rupee loan from The Ahmedabad Mercantile Co-operative Bank Limited amounting to Rs. 19.65 Lacs (P.Y. Rs. 50.56 Lacs). The loan is repayable in 24 Monthly installments of Rs.3.26 Lacs each including interest. The loan is secured by exclusive charge over entire movable plant and machinery acquired out of the said loan. Further, the loan has been guaranteed by the personal guarantee of some of the promoter directors.

(c) For nature of security of the loans from The Ahmedabad Mercantile Co-operative Bank Limited amounting to Rs. 103.40 Lacs (P.Y. Rs. Nil) and from financial institutions amounting to Rs. 3.75 Lacs (P.Y. Rs. 0.19 Lacs), refer note 5 (i) and (ii).

2 EMPLOYEE BENEFITS

The present value of gratuity and leave encashment obligations is determined based on actuarial valuation using the Projected Unit Credit Method, which recognizes each period of service as giving rise to additional unit of employee benefit entitlement and measures each unit separately to build up the final obligation.

The contribution expected to be made by the Company during the financial year 2012-13 has not been ascertained.

3 CONTINGENT LIABILITES (Rs.in Lacs)

As at As at Particulars 31st MARCH, 2012 31st MARCH, 2011

Disputed demand not acknowledged as debt against which the Company has 18.25 3.47 preferred appeal

Bills Discounted 72.69 50.17

4 SEGMENT REPORTING

The Company has identified two reportable segments viz (i) manufacture of engraved copper rollers and (ii) energy generation through wind mill.

The segment revenue, results, assets and liabilities include the respective amounts identifiable to each of the segment and amount allocated on a reasonable basis by management.

5 DISCLOSURES UNDER THE MSMED ACT, 2006

In the absence of any information from vendors regarding the status of their registration under the "Micro Small and Medium Enterprise Development Act 2006" the company is unable to comply with the disclosures required to be made under the said Act.

6 INTEREST IN JOINT VENTURE

The Company has entered into a Joint Venture Agreement with three Companies namely, Hannecard, Mitex Gummifabrik and Unimark International Private Limited to incorporate a Joint Venture Company in the name of HMSU Rollers (India) Private Limited on 1st February, 2012. The said Joint Venture Company will be engaged in the manufacturing of Rubber Rollers and Poly Urethene Rollers. The newly formed Company has yet not commenced its commercial operations. The Company has interests in the following jointly controlled entity:

7 ACQUISITION MADE DURING THE YEAR

In April 2011, the Company has entered into Joint Venture Agreement with Re S.p.A. Controlli Industriali, an Italy based Company to form a subsidiary named ReShilp Equipments (India) Private Limited with the main object to manufacture all types of Web Control & Reel Management systems and other related plants and machineries. The Company has acquired 51% stake in the said subsidiary Company. The subsidiary Company has commenced its commercial operations from 1st August, 2011.

8 PREVIOUS YEAR'S FIGURES

The company prepares and presents its finanical statment as per Schedule VI to the companies Act, 1956, as per applicable from time to time. In view of revision to the Schedule VI as per a notification issued during the year by the central Government, the financial statements for the financial year ended 31st March, 2012 have been prepared as per the requirements of the Revised Schedule VI to the Companies Act, 1956. The previous year figures have been accordingly regrouped / reclassified to confirm to the current year's classification.

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Mar 31, 2011

1. Contingent liability towards income tax for the Assessment Year 2008-09 aggregating to Rs.3.47 lacs (P.Y. Nil) in respect of disallowance of depreciation, for which Company's appeal is pending.

2. Estimated amount of contracts remaining to be executed on capital accounts not provided for (Net of Advance) Rs.109.81 Lacs (P.Y. Rs.34.76 Lacs).

3. Term loans amounting to Rs.186.09 Lacs (P.Y. ? 535.59 Lacs) and working capital loans of Rs.268.54 Lacs (P.Y. Rs.184.42 Lacs) from The Royal Bank of Scotland are secured by exclusive charge over fixed assets created / to be created out of the said loan and further secured by mortgage of immovable properties situated at the registered office of the Company and personal guarantee of all the promoter directors.

During the year all the Credit facilities (Term Loans and Working Capital facilities) provided by Kalupur Commercial Co. Operative Bank Limited ("K.C.C.B") have been shifted to The Ahmedabad Mercantile Co. Operative Bank Limited. The term loan from The Ahmedabad Mercantile Co-operative Bank limited amounting to ? 50.56 Lacs (P.Y. Rs.100.29 Lacs from K.C.C.B) is secured by exclusive charge over entire movable plant and machinery acquired out of the said Loan and further secured by personal guarantee of some of the promoter directors.

Working capital loan from The Ahmedabad Mercantile Co. Op. Bank Ltd of Rs.692.91 Lacs (P.Y. Rs.447.51 Lacs from K.C.C.B) is secured by present and future book debts and inventories of the Company, personal guarantee of some of the promoter directors and further secured by second charge over fixed assets held by The Royal Bank of Scotland.

Working Capital Loan from the Standard Chartered Bank of Rs.150.00 Lacs (P.Y. Rs.375.00 Lacs) is secured by hypothecation of stock and book debts and personal guarantee of some of promoter directors.

Term loan from Citi Bank amounting to Rs.135.33 Lacs (P.Y. Rs.203.00 Lacs) is secured by exclusive charge over plant and machinery created out of that loan. Hire purchase finances are secured by hypothecation of respective assets.

Unsecured loan from financial institution amounting to Rs.169.37 lacs (P.Y. Rs.166.87 lacs) includes loan from Life Insurance Corporation of India which is availed against Keyman Insurance Policies of the key employees of the Company.

4. Employee Benefits

The present value of gratuity and leave encashment obligations is determined based on actuarial valuation using the Projected Unit Credit Method, which recognizes each period of service as giving rise to additional unit of employee benefit entitlement and measures each unit separately to build up the final obligation.

5. In the absence of any information from vender's regarding the status of their registration under the "Micro Small and Medium Enterprise Development Act 2006" the company is unable to comply with the disclosures required to be made under the said Act.

6. Balances of receivables, payables and loans and advances to parties are subject to their confirmations. These balances are therefore, subject to adjustments, if any, as may be required on settlement of these balances with the parties.

7. Related Party Disclosures:

a) Related parties and their relationship

Name of the related party Relationship

Mr. Ambar J. Patel Key Management Personnel

Mr. Roshan Shah Key Management Personnel

Mr. G.V. Bhavsar Key Management Personnel

Mr. Narendra Patil Individuals exercising significant influence over the enterprise Mr. Atul Vinchhi Individuals exercising significant influence over the enterprise

Dr. B. V. Patel Individuals exercising significant influence over the enterprise

Mr.Vitthaldas H. Patel Individuals exercising significant influence over the enterprise

Mr.Vishnu V. Patel Individuals exercising significant influence over the enterprise

Shilp Ultra-tech Pvt Ltd. Entity controlled by Key Management Personnel

Stylus Infrastructure Entity controlled by Key Pvt Ltd Management Personnel

Carol Enterprise Entity controlled by Key Management Personnel

Carol Entity controlled by Key Management Personnel

Mr. Deval A. Patel Relative of Key Management Personnel

8. Previous year's figures have been regrouped / rearranged wherever necessary.

9. Pursuant to the resolution passed by the Board of Directors in their meeting held on 3rd November, 2010, the Company has entered into Joint Venture Agreement on 18th April, 2011 with Re S.p.A. Controlli Industriali, an Italy based Company and incorporated a Joint Venture Company in the name of "ReShilp Equipments (India) Private Limited" with the main object to manufacture all types of Web Control & Reel Management systems and other related plants and machineries. The Company holds 51% of stake in the newly incorporated Joint Venture Company.

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Mar 31, 2010

1. Estimated amount of contracts remaining to be executed on capital accounts not provided for (Net of Advances) Rs. 34.76 Lacs (P.Y. Rs 49.00 Lacs).

2. The Company was a partner and held 51 % share in the profits/loss of M/s Shilp Gravures, a partnership firm engaged in the business of manufacturing chemical etched gravure rollers.

On April 16,2009 a deed of retirement / dissolution of partnership was entered into by the partners of the said partnership firm pursuant to which the partnership was dissolved w.e.f April 15, 2009. In accordance with the dissolution deed, the Company has taken over the business of the partnership firm as a going concern along with all the assets (including intangible assets) and liabilities as appearing in the books of account of the firm. All partners of the partnership firm other than the Company shall be paid amounts standing to the credit of their accounts as at April 15,2009 towards full and final settlement of their dues as partners upon the dissolution of the partnership firm. The partners are entitled to recover interest at the rate of 9% p.a. on the unpaid amount till April 15,2010 and thereafter the unpaid amount if any, shall carry interest at the rate of 11% p.a. Accordingly, the following assets and liabilities have been acquired by the Company

3. Term loans amounting to Rs 535.59 Lacs(P.Y. Rs. 709.60 Lacs) and working capital loans of Rs. 184.42 Lacs (P.Y. Rs. 69.82 Lacs) from ABN AMRO Bank are secured by exclusive charge over fixed assets created / to be created out of the said loan and further secured by mortgage of immovable properties situated at the registered office of the Company and further secured by personal guarantee of all the promoter directors.

Term loan from Kalupur Commercial Co-operative Bank Limited amounting to Rs. 100.29 Lacs (P.Y. Rs. 176.68 Lacs) is secured by exclusive charge over entire movable plant and machinery, both present and future lying at the factory premises of the Company at Baroda and further secured by personal guarantee of some of the promoter directors.

Working capital loan from Kalupur Commercial Co-operative Bank Ltd of Rs. 447.51 Lacs (P.Y. Rs. 417.49 Lacs) and from Standard Chartered Bank of Rs.375.00 Lacs (P.Y. Rs. 250.00 Lacs) are secured by present and future book debts and inventories of the Company and further secured by personal guarantee of some of the promoter directors.

Term loan from Citi Bank amounting to Rs. 203.00 Lacs (P.Y. Nil) is secured by exclusive charge over plant and machinery created out of that loan.

Hire purchase finances are secured by hypothecation of respective assets.

Unsecured loan from financial institution amounting to Rs. 166.87 lacs includes loan from Life Insurance Corporation of India which is availed against Keyman Insurance Policies of the key employees of the Company.

4. Employee Benefits

The present value of gratuity and leave encashment obligations is determined based on actuarial valuation using the Projected Unit Credit Method, which recognizes each period of service as giving rise to additional unit of employee benefit entitlement and measures each unit separately to build up the final obligation.

5. In the absence of any information from venders regarding the status of their registration under the "Micro Small and Medium Enterprise Development Act 2006" the company is unable to comply with the disclosures required to be made under the said Act.

6. Balances of receivables, payables and loans and advances parties are subject to their confirmations. These balances are therefore, subject to adjustments, if any, as may be required on settlement of these balances with the parties.

7. Disclosures in respect of assets acquired under lease and hire purchase arrangements:

The Company has taken vehicles on hire purchase financing and hire purchase installments amounting to Rs. 3.03 Lacs (P.Y. Rs.4.93 Lacs) have been charged to the profit and loss account. The future minimum hire purchase installments are as under:

8. During the year, a fire took place in the Companys factory premises at Rakanpur, resulting in partial destruction of stock, consumables, plant and machinery and building. The Company has lodged a claim with the insurance company and the surveyors report assessing the loss is awaited. Pending the settlement of the claim, the Company has accounted for loss of Rs 39.81 lacs pertaining to the partial destruction of stores, consumables and other materials. Necessary accounting entries in respect of the insurance claim and for the loss of plant and machinery and building will be passed in the year of settlement of claim with the insurance company.

9. Related Party Disclosures:

a) Related parties and their relationship Name of the related party [ Relationship

M/s.Shilp Gravures Associate Concern (taken over w.e.f 16th April, 2009

Mr. Ambar J. Patel Key Management Personnel

Mr. Roshan Shah Key Management Personnel

Mr. G.V. Bhavsar Key Management Personnel

Mr. Narendra Patil Individual exercising significant influence over the enterprise

Mr. Atul Vinchhi Individual exercising significant influence over the enterprise

10. Segment Reporting

The Company has identified two reportable segments viz (i) manufacture of engraved copper rollers and (ii) energy generation through wind mill. The segment revenue, results, assets and liabilities include the respective amounts identifiable to each of the segment and amount allocated on a reasonable basis by management. Disclosures required under AS 17 - Segment Reporting are as under: (figures in brackets represent previous year numbers)

11. Comparative figures of the previous year do not include the figures of M/s Shilp Gravures - a partnership firm which was acquired during the year. Consequently, to that extent the previous year figures are not comparable with the figures for the year ended on March 31,2010.

12. Previous year figures have been regrouped / rearranged wherever necessary.

13. Additional information pursuant to the provisions of Clause 3,4C and 4D of Part II of Schedule VI of the Companies Act, 1956.

The Ministry of Company Affairs, Government of India, vide its Order No. 46/1/2007-CL- III dated 8th February 2007 issued under Section 211(4) of the Companies Act, 1956 has exempted the Company from disclosures of quantitative details in the Profit and Loss Account under paras 3(i) (a), 3(ii)(a) and 3(ii)(b) of Part II, Schedule VI to the Companies Act, 1956.