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Notes to Accounts of Sree Rayalaseema Hi-Strength Hypo Ltd.

Mar 31, 2015

1. Rights, preferences and restrictions

The company has only one class of share capital being Equity Shares having a face value of Rs. 10/- per share. Each share holder is entitled to one vote per share. The company declares and pays dividend in indian rupees. The dividend payable on equity shares is subjected to recommendations of Board of Directors and share holders in Annual General Meeting, except in the case of interim dividend. In the event of liquidation, the equity shareholders are eligible to receive the remaining assets of the company in proportionate to their share holdings.

2. The Company has no Subsidaries or Holding Company or associate companies holding shares in the company as on the date of Balance sheet

3. Of the above 1,47,16,689 issued shares, 24,86,028 Equity shares of Rs. 10/- each fully paid were issued for consideration for constructions with out payment received in cash as per terms of amalgamation.

4. Additional information on borrowings

1. Security

(a) The term loan and vehicle loans from banks are secured by exclusive charge on specific fixed assets.

(b)The loan repayable on demand from banks are cash credits, bills purchases, discountings, letter of credits limitsand bank guarantees are secured by Hypothecation of Raw-material, Stock in process, Finished goods, consumable Spares, Book debts and receivables.

(c) The working capital and Term loans from banks are also secured by first and second charge on some of the fixed assets of the company.

(d) The working capital and Term loans from banks arefurther secured by guarantee from Managing Director and a promoter in their individual capacities.

2. Defaults

There are no defaults/continuing defaults as on 31st Mar, 2015 in payment of interest and repayment of loans.

5. Contingent liabilities and Commitments

Contingent liabilities: (to the extent not provided for )

a) Claims against company not acknowledged as debts 3,57,04,682 10,20,24,054

b) Corporate Guarantees outstanding 97,40,000 2,30,20,816

c) Other money for which company is contingently liable - -

Commitments :

a) Estimated amount ofcontracts remainingtobeexecuted - 3,61,43,574

on capital account and not provided for

b) Uncalled liability on shares and other investments partly paid 500 500

c) Other commitments

1) Incometax appeal pending against ITOAO 3,04,714 3,04,714

2) Consumers cheques / bills discounted with Banks 14,39,81,914 16,88,48,875

3) Unexpired Bank Guarantees provided on behalfofthe Company. 3,38,11,382 1,06,01,216

4) Unexpired Letters of Credit established on behalfofthe Company. 27,29,42,422 27,14,50,919



d) Dividends remitted in Foreign Currency NIL

i) Total number of shares held by non-residents -

ii) Amount of dividend -

iii) No. of non resident share holders -

iv) Year to which the dividend is related -

6. Notes forming part of financial statements:

7. Corporate Information

Sree Rayalaseema Hi-Strength Hypo Limited is a public company domiciled in India and is Incorporated under the provisions of the companies Act, 1956. The company's principal business is manufacturing and sale of industrial chemicals and generation and distribution of power. The company caters to both domestic and Indian markets.

8. Basis of preparation

i) The accounts are maintained under Historical cost Convention and are prepared on accrual basis (except income and expenditure below Rs.5000/ per transaction and impairment or revaluation if any) as a 'going concern' by complying with generally accepted accounting principles and applicable Accounting Standards.

ii) The Accounting policies have been consistently followed and financial statements are prepared to comply in all material aspects in respect with Accounting Standards notified by the Companies Accounting Standards Rules, 2006 and relevant provisions of the Companies Act, 1956.

9. Use of estimates

The preparation of financial statements is in conformity with generally accepted accounting principles requires management to make estimates and assumptions that effect the reported amounts of such assets and liabilities and disclosure of contingent liabilities at the date of the financial statements and the result of operations during the end of reporting period. Although these estimates are based upon management's best knowledge of current events and actions, actual results could differ from estimates.

10. Presentation and disclosure in Financial Statements:

For the year ended 31st Mar, 2015, the newly enacted Companies Act, 2013 is applicable w.e.f. 01st April, 2014 to the company for presentation and disclosure in financial statements. The company's financial statements are in accordance with Schedule-III of the companies act 2013 and rules made there under and reclassifies the previous years figure accordingly.

11. Micro, Small and Medium Enterprises

The Company identified Micro, Small and Medium Enterprises on the basis of information made available to the company by the suppliers. The Company is regular in making payments to Micro, Small and Medium Enterprises. The principal amounts outstanding as on 31-03-2015 and remaining unpaid to any Micro, Small and Medium Enterprises is Rs. 2,50,10,056/- and the said amounts are due for less than 45 days as on 31-03-2015. Hence, excepting above, there is no reportable information under Sec 22 (i) to (v) of Micro, Small and Medium Enterprises Act, 2006 read with part I of Schedule VI to the Companies Act, 1956.

12. Disclosure pursuant to clause 32 of the listing agreement (As applicable to the company)

1) Cash flow statement according to AS3, Cash flow and related party disclosure as per AS18 are furnished as part of these financial statements.

2) Loans and Advances

Loans and Advances to associates are Rs.0/- outstanding as on 31.03.2015.

13. Disclosure under AS-15 Employee benefits

A. Defined contribution plan:

Contributions to defined contribution plan recognized as expenditure in profit and loss account are as under:

2014-15 2013-14 (Rs.) (Rs.)

Employers contribution to Provident fund 29.91 29.47

The provident fund contributions are remitted to Regional Provident fund Commissioner, Kadapa.

B. Defined benefit plan:

The company has employees group gratuity fund through a policy with LIC and contributes to the fund through annual renewal premium determined based on actuarial valuation using projected unit credit method as at 31-03-2015.The company has funded current service cost obligations and contributions made are recognized as expenses. The unfunded past service cost is provided as per actuarial valuation as on 31-03-2015.The disclosures in respected of funded and unfunded defined benefit obligations as required by AS 15 are as below.

14. Disclosure under AS-17 Segment reporting

The Company has disclosed Business segment as the primary segment with geographical segment being secondary segment based on geographical location of customers. Segment have been identified taking into account the nature of the products differing risks and returns, The organization structure and internal reporting system.

The Company operations predominantly relate to manufacture of chemicals. Other business segments reported are Wind energy generation.

Segment revenue, Segment Results, Segment Assets and Segment liabilities include the respective amounts identifiable to each of the segments as also amounts allocated on a reasonable basis.

The expenses, which are not directly attributed to the business segment, are shown as un-allocable corporate cost.

15. Disclosure under AS-18, Related Party Disclosure.

The Company has the following related parties on account of shareholdings by Key Management Personnel and their relatives.

(B) Enterprises on which Key Management Person has Significant Influence

a) TGV Securities Pvt. Ltd No

b) Vibhu Cement Pvt. Ltd No

c) Sree Arya Lakshmi Steels Pvt.Ltd., No

(C) Key Management Personnel :

Name of the Related Party Nature of Relationship

a) Mr. T G Bharath Chairman & Managing Yes Director

(D) Relatives of Key Relationship to Key Management person Management person

a) Sri T G Venkatesh Father

b) Smt.T G Rajyalakshmi Mother

c) Smt.T G Shilpha Bharath Wife

(i) Assets taken on Lease: Factory Buildings, Office Buildings and Hydrogen Cylinders

(ii) Leased out Assets: Chlorine Cylinders.

(iii) Future lease rentals are determined on the basis of agreed terms.

(iv) At the expiry of the lease term, the Company has an option either to return the asset or extended the term by giving notice in writing.

16. Disclosure under AS-22 Taxes on income.

Deferred tax liability:

The company has accounted for Deferred tax in accordance with Accounting Standard 22 " Accounting for Taxes on Income" issued by the Institute of Chartered Accountant of India and has charged the net profit and loss account with the deferred tax liability relating to the year net of Rs.164,21,693/-

17. Confirmation of balances.

Confirmation of balances from certain parties for amounts due to them or due from them is yet to be received.

Confirmation letters were received from some of the parties. No material discrepancies are observed.

18. Regrouped/ Rearranged/ Reclassified.

Previous year figures have been regrouped/rearranged wherever necessary to make them comparable with current year's disclosures and figures.

19. Rounding off.

Figures shown in the Financial Statements have been rounded off to the nearest rupee.


Mar 31, 2014

1.1 Rights, preferences and restrictions

The company has only one class of share capital being Equity Shares having a face value of Rs. 10/- per share. Each share holder is entitled to one vote per share. The company declares and pays dividend in indian rupees. The dividend payable on equity shares is subjected to recommendations of Board of Directors and share holders in Annual General Meeting, except in the case of interim dividend. In the event of liquidation, the equity shareholders are eligible to receive the remaining assets of the company in proportionate to their share holdings

1.2 The Company has no Subsidiries or Holding Company as on date of Balance sheet

1.3 During the year 4,92,506 Equity shares of Rs. 10/- each were issued pursuant to convertion of warrants under preferential allotment for cash at a premium of Rs. 44.62 per share as fully paid up.

1.4 Of the above 14716689 issued shares, 24,86,028 Equity share of Rs. 10/- each fully paid were issued for consideration with out payment received in cash as per terms of amalgamation

1.5 Additional information on borrowings 1. Security

(a) The term loan from banks are secured by exclusive charge on specified fixed assets.

(b) The loan repayable on demand from banks are cash credits, bills purchases, bills discounting, letter of credits limits and bank guarantees which are secured by hypothecation of Raw-material, Stock in process, Finished goods, consumable Spares, Book debts and receivables.

(c) The working capital and Term loans from banks are also secured by first and second charge on some of the fixed assets of the company.

(d) The working capital and Term loans from banks are further secured by guarantee from Managing Director and a promoter in their individual capacities

As at As at 31st Mar, 2014 31st Mar, 2013 2 Contingent liabilities and Commitments

Contingent liabilities: (to the extent not provided for )

a) Claims against company not acknowledged as debts 102024054 128903475

b) Guarantees outstanding 23020816 37075000

c) Other money for which company is contingently liable Commitments :

1) Estimated amount of

contracts remaining to be executed on capital account and not provided for 36143574 44177391

2) Uncalled liability on shares & other investments partly paid 500 500

3) Other commitments

i) Income tax appeal pending against ITO AO 304714 304714

ii) Customers cheques / bills discounted with Banks 168848875 158034276

iii) Unexpired Bank Guarantees provided by the Company 10601216 12102768

iv) Unexpired Letters of Credit established by the Company 271450919 217701067

d) Dividends remitted in Foreign Currency during the year i) Total number of shares held by non-residents

ii) Amount of dividend

Nil iii) No. of non resident share holders

iv) Year to which the dividend is related


Mar 31, 2013

1.1) Basis of preparation

i) The accounts are maintained under Historical cost Convention and are prepared on accrual basis (except income and expenditure below Rs.5000/per transactions and impairment or revaluation if any) as a ''going concern'' by complying with generally accepted accounting principles and applicable Accounting Standards.

ii) The Accounting policies have been consistently followed and financial statements are prepared to comply in all material aspects in respect with Accounting Standards notified by the Companies Accounting Standards Rules, 2006 and relevant provisions of the Companies Act, 1956.

1.2) Use of estimates

The preparation of financial statements is in conformity with generally accepted accounting principles requires management to make estimates and assumptions that effect the reported amounts of such assets and liabilities and disclosure of contingent liabilities at the date of the financial statements and the result of operations during the end of reporting period. Although these estimates are based upon management''s best knowledge of current events and actions, actual results could differ from estimates.

1.3 Micro, Small and Medium Enterprises

The Company identified Micro, Small and Medium Enterprises on the basis of information made available to the company by the suppliers. The Company is regular in making payments to Micro, Small and Medium Enterprises. The principal amounts outstanding as on 31-03-2013 and remaining unpaid to any Micro, Small and Medium Enterprises is Rs.3,20,97,715/- and the said amounts are due for less than 45 days as on 31-03-2013. Hence,excepting above, there is no reportable information under Sec 22 (i) to (v) of Micro, Small and Medium Enterprises Act, 2006 read with part I of Schedule VI to the Companies Act, 1956.

1.4 Disclosure pursuant to clause 32 of the listing agreement (As applicable to the company)

1) Cash flow statement according to Accounting Standard - 3, Cash flow and related party disclosure as per Accounting Standard - 18 are furnished as part of this financial statements.

2) Investments in own shares of the company

The company had acquired its own equity shares as per scheme of arrangement from transferor company. The beneficiary interest is held through its directors. The shares held as on 31.03.2013 are 1025289 equity shares.

3) Loans and Advances

Loans and Advances to associates is Rs. 25,29,380/- outstanding as on 31.03.2013.

1.5 Disclosure under AS-16 Borrowing costs

During the financial year the company has two qualifying assets i.e. expansion of calcium hypo chlorite project and captive thermal project at the end of the year and these are under implementation. The Borrowing cost that are directly relate to these qualifying assets are determined, identified and capitalised during the financial year amounted to Rs 4,88,93,646/- (previous year : Rs.1,65,57,218/- )

1.6 Disclosure under AS-17, Segment Reporting

The Company has disclosed Business segment as the primary segment with geographical segment being secondary segment based on geographical location of customers. Segment have been identified taking into account the nature of the products differing risks and returns, The organization structure and internal reporting system.

The Company operations predominantly relate to manufacture of chemicals. Other business segments reported are Wind energy generation.

Segment revenue, Segment Results, Segment Assets and Segment liabilities include the respective amounts identifiable to each of the segments as also amounts allocated on a reasonable basis.

The expenses, which are not directly attributed to the business segment, are shown as un-allocable corporate cost.

Assets and liabilities that cannot be allocated between the segments are shown as a part of un-allocable corporate assets and liabilities respectively.

1.7 Confirmation of balances.

Confirmation of balances from certain parties for amounts due to them or due from them is yet to be received.

Confirmation letters were received from some of the parties. No material discrepancies are observed.

1.8 Regrouped/ Rearranged/ Reclassified.

Previous year figures have been regrouped/rearranged/reclassified wherever necessary to make them comparable with current year''s disclosures and figures.

1.9 Rounding off the figures

Figures shown in the accounts have been rounded off to the nearest Rupee.


Mar 31, 2010

1) The Sales tax liability is being accumulated in view of sanction of deferment by the Government of Andhra Pradesh as per State Incentive Scheme and is included under unsecured loans.

2) Confirmation of balances from certain parties for amounts due to them or due from them are yet to be received. Confirmation letters were received from some of the parties. No material discrepancies are observed.

3) The Company identified Micro,Small and Medium Enterprises on the basis of information made available to the company by the suppliers. The Company is regular in making payments to Micro,Small and Medium Enterprises. The principal amounts outstanding as on 31-03-2010 and remaining unpaid to any Micro,Small and Medium Enterprises is Rs.1,30,15,961/-and the said amounts are due for less than 45 days as on 31-03-2010.Hence,excepting above, there is no

4. Related parties Disclosures :

The Company has the following related parties on account of shareholdings by Key Management Personnel and their relatives.

(A) Particulars of Associate Companies

Name of the Related Party

a) Sree Rayalaseema Alkalies and Allied Chemicals Ltd.

b) Sree Rayalaseema Dutch kassenbouw Pvt. Ltd.

c) TGV Projects & Investments Pvt. Ltd.

d) Brilliant Bio Pharma Ltd.

e) Sree Maruthi Marine Industries Ltd.

f) Gowri Gopal Hospitals Pvt. Ltd

g) Sree Rayalaseema Galaxy Projects Pvt. Ltd. h) SRHHL Industries Ltd.

i) Sree Maruthi Agro Tech Ltd.

j) T G V Pharma Pvt. Ltd.

k) Vibhu Cements Pvt. Ltd.

l) Shree Arya Lakshmi Steels Pvt. Ltd.

5. Segment Reporting

The Company has disclosed Business segment as the primary segment with geogrophical segment being secondary segment based on geographical location of customers. Segments have been identified taking into account the nature of the products differing risks and returns, the organisation structure and internal reporting system.

The Companys operations predominantly relate to manufacture of chemicals.

Other business segments reported are wind energy generation.

Segment Revenue, Segment Results, Segment Assets and Segment liabilities include the respective amounts identifiable to each of the segments as also amounts allocated on a reasonable basis.

The expenses, which are not directly attributed to the business segment, are shown as unallocable corporate cost.

Assets and liabilities that cannot be allocated between the segments are shown as a part of unallocable corporate assets and liabilities respectively.

6).Disclosure pursuant to Accounting Standard 15 (Revised 2005) Employee benefits:

A. Defined contribution plan:

Contribution to defined contribution plan recognized as expenditure in profit and loss account are as under:

2009-10 2008-09

(Rs. in lakhs) (Rs. in lakhs)

Employers contribution to

Provident fund 27.57 26.64

The provident fund contributions are remitted to Regional provident fund Commissioner,Kadapa.

B. Defined benefit plan:

The company has employees Group Gratuity Fund through a policy with LIC and contributes to the fund through annual renewal premium determined based on actuarial valuation using projected unit credit method as at 30-09-2009.The company has funded current service cost obligations and contributions made are recognized as expenses. The unfunded past service cost is provided as per actuarial valuation as on 30-09-2009.The disclosures in respected of funded and unfunded defined benefit obligations as required by Accounting Standard 15 are given below.

 
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